Rice Midstream Partners Announces 2016 Capital Budget and Guidance

24 Feb, 2016, 17:03 ET from Rice Midstream Partners LP

CANONSBURG, Pa., Feb. 24, 2016 /PRNewswire/ -- Rice Midstream Partners LP (NYSE: RMP) ("RMP") today announced its 2016 capital budget and guidance. Estimated capital investments and financial guidance include:

  • Capital budget of $150 million, a 12% reduction from 2015 investments
  • Average gathering throughput of 800 MDth/d, a 24% increase over 2015 throughput
  • Adjusted EBITDA(1) of $110$120 million
  • Distributable cash flow ("DCF")(1) of $90 - $100 million
  • Average DCF coverage ratio of 1.3x to 1.5x during 2016
  • Forecasted 2016 annual distribution growth of 20%
  • Exit leverage of approximately 2.5x (net debt/LQA Adjusted EBITDA)

Commenting on the 2016 RMP capital budget and guidance, Daniel J. Rice IV, Chief Executive Officer, said, "The quality of our assets and strength of our balance sheet positions us for continued success, despite today's challenging commodity price environment. Our sponsor and third party customers have some of the lowest breakeven prices in the country protected by hedging and firm transportation portfolios, which drives RMP's continued growth. RMP's cash flow is protected by 100% fixed fee contracts, and we are confident in RMP's ability to continue generating strong throughput and distribution growth."

2016 Capital Budget ($ in millions)

Gas Gathering and Compression

$

140

Water Services

$

10

Total Capital Expenditures

$

150

Estimated Maintenance Capital

$

11

 

We expect to invest $150 million in capital expenditures during 2016. We will spend $140 million building high pressure gas gathering pipelines and adding compression capacity in Pennsylvania. We expect the compression capacity to be placed into service mid-2016 and compress substantially all of our throughput volumes adding significant revenue. We will spend $10 million expanding our water services business in Pennsylvania and Ohio. Rice Energy announced its 2016 capital budget this morning in a separate news release, which is available on www.riceenergy.com.

1.

Please see "Supplemental Non-GAAP Financial Measures" for a description of Adjusted EBITDA and Distributable Cash Flow.

2016 Financial Guidance

We anticipate 2016 Adjusted EBITDA of $110$120 million and DCF of $90$100 million. We expect to increase our annual distribution by 20% while maintaining an average DCF coverage ratio of 1.3x to 1.5x over the course of the year.

2016 Guidance

Cash G&A ($ in millions)

$

15

-

$

18

Adjusted EBITDA ($ in millions)

Gas Gathering and Compression

$

85

-

$

90

Water Services

$

25

-

$

30

Total Adjusted EBITDA

$

110

-

$

120

% Third Party

20%

-

25%

Distributable Cash Flow ($ in millions)

$

90

-

$

100

Average DCF Coverage Ratio

1.3x

-

1.5x

% Distribution Growth

20%

 

About Rice Midstream Partners

Rice Midstream Partners LP is a fee-based, growth-oriented limited partnership formed by Rice Energy Inc. (NYSE: RICE) to own, operate, develop and acquire midstream assets in the Appalachian basin. RMP provides midstream services to Rice Energy and third-party companies through its natural gas gathering, compression and water assets in the dry gas cores of the Marcellus and Utica Shales.

For more information, please visit www.ricemidstream.com.

Forward Looking Statements

This release includes forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. All statements, other than historical facts included in this release, that address activities, events or developments that we expect or anticipate will or may occur in the future, including such things as, forecasted gathering volumes, revenues, Adjusted EBITDA, distribution growth, and distributable cash flow, the timing of completion of midstream projects, future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strengths, goals, expansion and growth of our business and operations, plans, market conditions, references to future success, references to intentions as to future matters and other such matters are forward-looking statements. All forward-looking statements speak only as of the date of this release. Although we believe that the plans, intentions and expectations reflected in or suggested by the forward-looking statements are reasonable, there is no assurance that these plans, intentions or expectations will be achieved. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements.

We caution you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to the exploration for and development, production, gathering and sale of natural gas and oil. These risks include, but are not limited to: commodity price volatility; inflation; lack of availability of drilling and production equipment and services; environmental risks; drilling and other operating risks; regulatory changes; the uncertainty inherent in estimating natural gas reserves and in projecting future rates of production, cash flow and access to capital; and the timing of development expenditures. Information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our Forms 10-K, 10-Q and 8-K. Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements and there can be no assurances that the actual results or developments anticipated by us will be realized, or even if realized, that they will have the expected consequences to or effects on us, our business or operations. We have no intention, and disclaim any obligation, to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.

Supplemental Non-GAAP Financial Measures (Unaudited)

Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our consolidated financial statements, such as securities analysts, investors and lenders. We define Adjusted EBITDA as net income (loss) before interest expense, income tax benefit, depreciation and amortization, stock compensation expense and incentive unit expense. Adjusted EBITDA is not a measure of net income as determined by GAAP.

Distributable cash flow is a supplemental non-GAAP financial measure that is used by management and external users of our consolidated financial statements, such as securities analysts, investors and lenders. We define distributable cash flow as Adjusted EBITDA, plus interest income, less cash interest expense, estimated maintenance capital expenditures and income taxes. Distributable cash flow does not reflect changes in working capital balances and is not a presentation made in accordance with GAAP.

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SOURCE Rice Midstream Partners LP



RELATED LINKS

http://www.ricemidstream.com