Which Segment Could Drive Williams Partners’ Q2 2018 Performance

Atlantic Gulf segment

In Q2 2018, Williams Partners’ (WPZ) Atlantic Gulf segment is expected to benefit from its Transco expansion projects being placed into service, natural gas demand, and its processing margins. During the quarter, average crude oil prices rose YoY (year-over-year) to $67.90 per barrel from $48.10 per barrel. The above positives might be partially offset by lower contribution from its Discovery joint venture and higher operating and maintenance expenses resulting from projects being placed into service.

Which Segment Could Drive Williams Partners’ Q2 2018 Performance

Williams Partners placed five major Transco expansion projects into service in 2017: Virginia Southside II, Gulf Trace, Hillabee Phase 1, the New York Bay expansion, and the Dalton expansion.

West segment

Williams Partners’ West segment, which is involved in natural gas gathering, natural gas transportation, and NGL (natural gas liquid) fractionation and marketing, posted a 4.4% YoY adjusted EBITDA increase in Q1 2018. The segment’s performance is expected to improve in the second quarter of 2018, driven by strong drilling activity in the Haynesville region and wider commodity margins.

Northeast gathering and processing segment

The Northeast G&P (gathering and processing) segment saw its EBITDA fall 9.0% during the first quarter of 2018. The segment’s sluggishness continued in the second quarter due to lower throughput volumes from the Utica region, which are expected to be partially offset by the acquisition of interest in two Marcellus gathering systems. In the next article, we’ll look at producer activity in the regions where Williams has strong exposure.