- Adjusted EBITDA Growth Rose to $3.9B in Q2 2025 vs. $3.8B in Q2 2024.
- Capital Expenditure $5B allocated for 2025 organic growth projects with mid-teen returns.
- Desert Southwest Pipeline $5.3B project to deliver 1.5 Bcf/day, 6x EBITDA multiple, operational by Q4 2029.
- Lake Charles LNG Progress 15 MTPA capacity target secured via SPAs and HOA with MidOcean Energy.
- EBITDA Guidance Lowered To lower end of range due to Bakken weakness and dry gas area recovery delays.
Growth Investments and Strategic Projects
ET remains committed to its organic growth strategy, planning to invest approximately $5 billion in capital projects this year. This includes several key projects like the Desert Southwest Pipeline, Hugh Brinson Pipeline, and the Flexport NGL Export Expansion Project. The company emphasizes the attractive returns anticipated from these projects, with the Desert Southwest Pipeline projected to yield a 6x EBITDA multiple and mid-teen returns.
Lake Charles LNG and Future Outlook
The Lake Charles LNG project continues to progress, with a HOA signed with MidOcean Energy and 20-year SPAs secured with Kyushu Electric Power Company and Chevron USA. ET is nearing its target of 15 million metric tonnes per annum of capacity. Despite these positive developments, the company lowered its adjusted EBITDA guidance for 2025, citing challenges in the Bakken, slower recovery in dry gas areas, and a lack of normal volatility in the gas optimization business.
Addressing Headwinds and Opportunities
ET acknowledges the headwinds impacting its Bakken operations, including pipeline capacity constraints, production curtailments in Canada, and wildfires impacting transportation. However, the company remains optimistic about future Bakken volumes, driven by increasing Canadian egress needs and a new open season with Enbridge to enhance capacity. ET is proactively managing potential NGL pipeline capacity constraints in the Permian by expanding Lone Star and securing new contracts with processing plants.
Strategic Initiatives and Growth Drivers
ET is pursuing bidirectional capability for the Hugh Brinson Pipeline to meet evolving customer needs, including gas wheeling at various points along the route. The company is also actively exploring opportunities in AI-powered data centers, recognizing the potential for significant EBITDA contribution from this sector.