EnLink Midstream Partners' (ENLK) CEO Mike Garberding on 2018 Guidance Conference Call (Transcript)

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About: EnLink Midstream Partners, LP (ENLK)
by: SA Transcripts

EnLink Midstream Partners, LP (NYSE:ENLK) 2018 Guidance Conference Call February 7, 2018 12:00 PM ET

Executives

Kate Walsh - Vice President of Investor Relations

Barry Davis - Chairman

Mike Garberding - President and Chief Executive Officer

Eric Batchelder - Executive Vice President and Chief Financial Officer

Benjamin Lamb - Executive Vice President, Corporate Development

McMillan Hummel - EVP, President, Natural Gas Liquids and Condensate Business

Analysts

Jeremy Tonet - JPMorgan

Darren Horowitz - Raymond James

Christine Cho - Barclays

Mirek Zak - Citi Group

Barrett Blaschke - MUFG Securities

Craig Shere - Tuohy Brothers

Operator

Good day and welcome to the EnLink Midstream's 2018 Guidance Conference Call. All participants will be in a listen only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this call is being recorded.

I would now like to turn the conference over to Kate Walsh, Vice President of Investor Relations and Tax. Please go ahead.

Kate Walsh

Thank you and good morning, everyone. Thank you for joining us today to discuss EnLink Midstream 2018 Guidance outlook. Participating on the call today are Barry Davis, Executive Chairman; Mike Garberding, President and Chief Executive Officer; Eric Batchelder, Executive Vice President and Chief Financial Officer; Mac Hummel, President of the Natural Gas Liquids Crude and Condensate Business; and Ben Lamb, Executive Vice President of Corporate Development.

To accompany today's call, we have posted our 2018 guidance release and presentation to the Investor Relations portion of our website. Shortly after today's call, we will also make available a webcast replay of this call in our website.

I will remind you that statements during this conference call made about the future, including our expectations or predictions, should be considered forward-looking statements within the meaning of the Federal Securities laws. Actual results may differ materially from what is described in these forward-looking statements. Forward-looking statements speaks only as of the date of this call and we undertake no obligation to update or advise any forward-looking statements.

Additional information on factors that could cause actual results to differ from what is subscribed in the forward-looking statement is available in our guidance press release and the presentation accompanying this call located at www.enlink.com and in our SEC filings.

This call also include certain non-GAAP financial measures. Definitions of these measures as well as reconciliations of these non-GAAP measures to comparable GAAP measures are available in our guidance press release and presentation on enlink.com. We encourage you to review the cautionary statements and other disclosures made in our guidance press release and our SEC filings, including those under the heading Risk Factors.

The structure of the call, we could start with prepared remarks by Barry Davis, and Mike Garberding and Eric Batchelder and then leave the majority of the call open for a question-and-answer period.

With that, I would now like to turn the call over to Barry Davis.

Barry Davis

Thank you Kate, and good morning, everyone. Thank you all for joining us today. 2018 is off to a solid and active start for EnLink. A few weeks ago, we announced the resumption of distribution growth at ENLC and today, we are pleased to share our 2018 outlook with you.

Set the stage for our 2018 guidance discussion, I'll first give an update that we exited 2017 on a very strong note with ENLK achieving fourth quarter adjusted EBITDA at the high end and really just over the high end of our annualized run rate guidance range of $925 million to $950 million or $238 million on a quarterly basis.

We look forward to providing more details on February 21st with respect to our fourth quarter and full year 2017 results. The key takeaway today is that we were expecting our volume ramp to materialize in the second half of 2017 and that is exactly what happened. And that volume ramp translated directly into strong financial performance as we exited 2017. 2018 is shaping up to continue that trend of momentum and strong growth. The 2018 guidance outlook we announced yesterday reflects our expectation for adjusted EBITDA to increase around 15% as compared to our 2017 guidance midpoint of $860 million.

We are set up well for continued success in 2018. Growing adjusted EBITDA by 15% means we're adding $125 million to our results this year and are on pace to generate around $1 billion in adjusted EBITDA for full year 2018. Reaching the $1 billion adjusted EBITDA milestone will be an exciting accomplishment for EnLink.

EnLink's 2018 strategic plan is driven by strong business fundamentals, a clear path forward with our seven growth strategies and the right team in place to continue to execute with excellence each and every day.

With that, I'll turn the call over to Mike.

Mike Garberding

Thanks Barry, and good morning, everyone. As Barry highlighted, EnLink delivered a strong finish to 2017 coming in slightly above the high end of our fourth quarter guidance. This momentum sets the stage for continued growth and value creation this year, primarily driven by executing on our seven growth strategies. One of our key growth drivers for 2018 centers around our strategy to maximize our strategic position in Oklahoma.

We're seeing key producer customers accelerate activity in the stack with the first production from Devon's 24 well multi-zone developments Showboat expected during the first half of 2018. Producers are moving into full field development in 2018 and the rig activity during the second half of 2017 is driving our 2018 growth today.

Our systems will benefit tremendously from the activity underway. During 2018, we are expecting an increase of between 30% and 40% in Oklahoma segment profit and volumes when compared to our third quarter 2017 annualized results. And given our increasingly interconnected system focusing on our commodities, growth in Oklahoma translates directly to growth in our NGL Gulf Coast business as well as growth on our Black Coyote crude oil system.

Today, we are preferentially shipping NGLs from Oklahoma footprint to our Gulf Coast platform and we're projecting that our NGL pipeline Cajun-Sibon will be operating at full capacity for most of 2018. With capacity nearing full utilization, we are actively evaluating our next stage of expansion related to Gulf Coast NGL infrastructure and expects to communicate an update later this year.

We're also continuing to see solid growth in the Permian with increasing utilization of our Midland Basin assets and building scale in the Delaware Basin.

Proactively participate in the Barnett Shale redevelopment is also something we continue to focus on. As you all know, our minimum buy commitments with Devon in the Barnett expire at the beginning of 2019. In Lincoln, our sponsor Devon have been proactive on a number of fronts to reinvigorate volumes in this mature basin. We'll have more specifics around our ongoing Barnett initiatives during in 2017 earnings call on February 21st.

And with that, I'll turn over to Eric.

Eric Batchelder

Thank you Mike, and good morning, everyone. As Barry highlighted, we're forecasting solid adjusted EBITDA growth for ENLK this year and are projecting our midpoint to be $985 million. As we continue to grow our business and add $125 million to adjusted EBITDA will also be further building out our asset footprint across our key growth regions including Oklahoma, the Permian and the Gulf Coast. Stability remains a consistent theme as we look ahead to 2018 as we expect approximately 90% of the ENLK's gross operating margin to come from fee based activities which is consistent with our results over the last few years.

We forecast full year distribution coverage of between 1 and 1.1 times at ENLK, assuming an unchanged distribution throughout the year. At ENLC, we expect to further grow cash flows and our 2018 guidance forecasts cash available for distribution of between $230 million and $240 million. Distribution coverage remains attractive at ENLC and we expect full year coverage of between 1.16 and 1.22 times after giving effect to the previously announced 5% growth in 2018 declared distributions over 2017 declared distributions.

We expect our 2018 capital program to be similar to our 2017 capital program with growth capital expenditures net to ENLK of around $650 million. We plan to invest virtually all of our anticipated 2018 growth capital in our four key growth areas with roughly half directed to Central Oklahoma. The capital that we are putting to work this year is highly efficient capital which we define as having a short cycle time between dollars spend and projects becoming cash generating and driving accretion to our financial performance and value to our unit holders.

Key projects that we plan to place into service this year include the Black Coyote crude oil gathering system in the stack. Our Lobo III gas processing plant in the Delaware and a handful of bolt on projects across our network in Louisiana. 2018 is about continuing to execute on the right plan that was developed throughout 2017. And with this execution, comes an unchanged commitment to and focus on our financial tenets, which include increasing our adjusted EBITDA, enhancing our investment grade balance sheet, maintaining long term leverage in the 3.5 to 4 times range and building distribution coverage while returning capital to unit holders.

And with that, I'll turn it back to Mike.

Mike Garberding

Thanks, Eric. Before we open up to discussion for Q&A, I'll say this. 2018 is the year we've been looking forward to. We've been through three years of a downturn and the moves that we may have positioned us for growth. When the right places with the right partners and we're executing the right plan. All of which will drive strong results for 2018.

With that, you may open up the call up for questions.

Question-and-Answer Session

Operator

[Operator Instructions] And our first question will come from Jeremy Tonet of JPMorgan.

Jeremy Tonet

Good Morning. For the guidance for the year, I was just curious if you might be able to provide a little bit more color on kind of the cadence of the ramp if it's linear or if there's lumpy or kind of anymore color you could provide with regard to exit rate for 2018?

Mike Garberding

Hey, Jeremy. This is Mike. Let me start by giving some thoughts around guidance and then I'll turn over to Ben to give some further color on that question. But our goal with coming out with guidance today was to get company level guidance in your hands earlier than our earnings release which right now is on the 21, that's a little later than usual and we do it in conjunction with Devon. So we put out company level guidance for, okay, you now see, but we don't have all segment level guidance. So we're going to have that out. We're going to have 17 actually out of the 21. So we'll probably push some questions to that just where we have some numbers we can point toward, but will walk through and give you good color on everything that we can in this call. So I'll turn it over to Ben to walk through your question.

Benjamin Lamb

Hello, Jeremy. Certainly in Oklahoma, we are not going to see a linear ramp by any means. And that just reflects the fact that all of our big producers you think about the large cap independence that we serve Devon, Newfield, Marathon, each of them is transitioning into full field development mode. And the way that looks today, each of those three companies has multiple rigs running on a single location that will turn into a fairly lumpy volume increase for us at some point later in the year. And we see that continuing as we go forward. We're going to have fewer and fewer wanting to well pads and more and more large scale developments not only by those guys but even by some of the smaller companies and some of the private companies that we serve. So there certainly will be some lumpiness to the volume growth. And I would say 2018 will be more of a back end weighted volume story the same way that 2017 was. The same thing we told you this time last year about 2017 well out of 2018.

Jeremy Tonet

Okay. Great. Thanks for that. And then maybe just Oklahoma, if I could dig in a little bit there, looks like a volume in segment profit guidance was 30% to 40% above 3Q, 2017 annualized, was wondering if you could walk us through a little bit more on the drivers or maybe confidence level on heading those numbers.

Mike Garberding

Yeah, sure. I mean in terms of drivers, we've seen a sustained high level of activity on the assets in Oklahoma over the last three quarters or so, the last three quarters of 2017. And as you know there's a cycle time from the time that the producer picks the rig up, the well gets drilled, the well gets completed, the well flows, it takes some time for that to happen. And so what we are realizing in early 2018 is the benefit of that activity that we saw in the back after 2017. And the good news is, we see activity levels in 2018 that are continuing to push that momentum forward. So what we see in the first half of 2018 will drive 2Q, 3Q, 4Q, 2018 results. And I feel very good about 30% to 40% growth off of the 3Q, 2017 annualized numbers which are the last numbers that we've reported.

Jeremy Tonet

Gotcha. So both profit for the full year 2018 will be up over 3Q annualize?

Mike Garberding

Yeah. If you look at the 3Q segment profit for Oklahoma, I believe the number was $79.1 million. So multiply that by four and add 30% to 40% and you get a range of something like 1.15 - I'm sorry $410 million and $440 million. On the gather volumes 3Q annualized was something like 890,000 million MMBtus a day, so add 30% to 40% of that you get 1.15 to 1.25-ish I guess that be billion 9MMbtus a day. And we're going to be in that range when we come out on the 21st and show you segment level information.

Jeremy Tonet

Very helpful. Thank you very much for that. One last one if I could just with regards to your latest thoughts on simplification, it seems like with EnLink, the IR burden is in the same situation as it is for some the others where we see simplification recently, but it still seems like the market has a just a growing preference for that overall simplifying the story. Just wondering if you had any updated thoughts on that topic that you could share with us at this time?

Mike Garberding

Yeah Jeremy. This is Mike. We give that question a lot and how we think about that is that our goal is to position the business long term in the right structure. So like you mentioned, we don't have any current issue that's forcing our hand in the sense to have to make a decision. Our idea, our burden is very small, we don't have any tax issues et cetera. So we think the right thing to do is continue to evaluate what we think that right long term business structure is and that's how we need to position it. It's been a little difficult to look at maybe peers are comparable in the last two years and how they traded and how investors are thought about that because of a lot of the other influences where there was commodity market or business influences. So we spend a lot of time on it and study it, but right now, we believe we're in the structure we need to in our focus is on our seven growth strategies.

Jeremy Tonet

Great. That's it for me. Thank you.

Operator

And the next question will come from Darren Horowitz of Raymond James.

Darren Horowitz

Good morning, guys. Couple of quick ones. The first, of the $650 million growth CapEx net ENLK, if we dig a little deeper and when we look at the $340 million to $420 million just for Oklahoma, can you give us a little bit more color on how much of that is as you mentioned is short cycle or maybe what the turnaround time difference is on those projects between cash deployed and EBITDA generated versus maybe what's in the rest of the backlog?

Benjamin Lamb

Yeah, hi, Darren. It's Ben. So of that $340 to $420 million this going to be in Oklahoma, the biggest piece - single piece is the Thunderbird processing plant which is going to be $100 million to $120 million of that number. That is relatively long cycle, it takes about a year to build the plant and a little bit of time for the plant to come online, it's short cycle on the grand scheme but long cycle in the context of a G&P business. Most of the rest of the capital really is for well connects and compression.

And one of the benefits of the producers going into full field development mode is it takes them sometime between the time to make a decision to develop a given unit and the time that unit comes online. That means we have the luxury of the time to plan accordingly. So when their plans accelerate, we have some flexibility to accelerate. If their plans work at decelerate, I think we would know that and in time that we would be able to decelerate as well. So we're able to better match the timing of the capital with the timing of the cash flow.

To sum it up, I would say it's about a six month lag from the time that you begin spending on a system expansion capacity expansion from the time you begin to see volumes, certainly that will vary situate situationally, but I'd say that's the good blow up.

Mike Garberding

Hey, Darren, it's, Mike. And the remainder capital, it's pretty consistent because use Texas for example, the big driver theirs is Lobo III and that's very consistent with what Ben said about that. But the rest of the really the Permian capital is that gathering compression. And so I would say that the majority of our capital is really more of that quick cash capital is building up our core system.

Darren Horowitz

Okay. That makes sense. Just shifting a little bit to the Tall Oak. I think last time we spoke when we were discussing the conversion and distributions from Tall Oak, it was a few months ago maybe just south of $200 million and everything was tracking according to your plan. I'm just I'm wondering with regard to the remaining dropdown of those assets, certainly the uptick in EBITDA and cash flow in the way the security service bonded, how are you still thinking about the composition of consideration for that drop?

Mike Garberding

Hey, Darren. This is Mike. So like we mentioned in the third quarter call, we have the capability to look at it consider dropping because we've crystallized the tax benefits to the ENLC. We still believe right now the right thing to do is to have that up there. There's capital that ENLC is paying for to grow the Central Oklahoma system. And so we don't have any plans today to do anything with regard to the dropdown from ENLC to ENLK of that 16%, but we have the capability to do that.

To your point, you are correct. I would say what you pointed out was that if you look at the guidance for 2018 specifically in the ENLC, you'll see that really we're hitting the numbers we laid out three years ago with regard to this acquisition. And that's a big deal because that was during two of the three years of a pretty big downturn. And so I would say we're right on track on where we wanted to be from Central Oklahoma.

Darren Horowitz

Okay. And then just if I could Mike one quick follow-up on that. With regard to the kind of the balance at ENLC between retain cash not just from a coverage perspective, but also to self on what is necessary on CapEx versus how that distribution growth unfolds. If we think about building off of 2018 to 2019, is it still fair to assume that provided that remaining 16% remains at ENLC that ENLC will still want to fund 75% of its upcoming growth CapEx with excess cash such that any excess beyond that is going to be a balance between how much you grow that distribution year-over-year versus maybe just how much you want to retain for debt service?

Mike Garberding

That is fair in general, because I would say that with any developing area, we will see or expect to see capital decreasing overtime as that area is built out. As long as the 16% is up at ENLC, we will be prudent with regard to what kind of coverage ratio we have up there just to manage that asset. But we do believe the right thing ultimately to do is to have cash to manage the assets and ultimately distribute to the unit holders any excess cash of that.

Darren Horowitz

Sure. Okay. That's all I guess. I appreciate it. Thank you.

Operator

And the next question comes from Christine Cho of Barclays.

Christine Cho

Hi, everyone. I was curious to know how you guys came up with the $60 price tag for the WTI, I know your exposure to Devon is not as what just it used to be as you guys diversified into that area, but curious as to the rationale for using a price tag that's different from Devon?

Mike Garberding

This is Mike. And so how we think about the price tag is the drivers to the business. And if you think about how the business is model and thought about is that we use producer forecasts at each area to drive ultimately volume forecasts and so that $60 is more in relation about how we thing about opportunities around our business, which are very small right we're 90% fee based. And so I think that when you think of the 60, it's pretty small if book implications of the overall business, but we're using each producer's own price deck and their thoughts about development in drilling to drive ultimately the financial results we're seeing.

Christine Cho

Okay. Yeah, I understand, because it's mostly fee based, the actual price is not going to impact you guys as much. But I guess my question is, to the extent that number ends up moving, would the volumes really impact 2018 or would it actually be more of a 2019 event?

Mike Garberding

Yeah, Christine. I would say from the G&P business perspective, my expectation it would be more than 19 event. I think that producer plans are fairly well locked in for this year not to say that they don't have some flexibility around the back half, certainly they do. That everything that we're seeing right now would tell us that 2018 is fairly well understood in terms of producer plans.

Christine Cho

Okay. And then I don't know how much you can say about, this but should we think that the drop of the remaining Tall Oak asset is a little bit on hold on to until you figure out what you want your structure to be at longer term. I guess where I'm going with this is, is there a reason to drop it if there's a chance that you actually might roll up ENLK later on?

Mike Garberding

Yeah. This is Mike, again. It's just one of the considerations, Cho, will you be thinking about but is it as I mentioned earlier on Darren's question is that we think the right answer right now is where we're today, we'll keep it evaluating, but you ultimately got to get to what is that right long term structure. So I would say today is really business as usual.

Christine Cho

Okay. And then last one for me. Maintenance CapEx for the year is higher than is historically has been, can you walk us through what's driving that?

Eric Batchelder

Sure. Thanks, Christine. It's Eric Batchelder. I would say you look at some of the assets and you have certain of these assets that require overhauls that aren't necessarily on an annual basis and this happens to be a year where we have a number of those rolling in which is driving the increase in maintenance CapEx. I think on a consistent basis we think about it is sort of a $40 million to $50 million run rate and it's a little bit higher than that for 2018 because of the cycle of some of these overhauls.

Christine Cho

Which assets are that are they exactly and you said it happens once every several years, so is it like once every four or five years sort of thing?

Benjamin Lamb

A lot of it - Hey, Christine, it's Ben. A lot of it is compression. So you track the hours on the compressors and when you hit a certain number of hours, they need a different level of overhaul and we have a heavy maintenance year this year. We have more compressors that we think are going to be at the point where they need a significant overhaul.

Christine Cho

Okay.

McMillan Hummel

And then this is Mac. I would just add on that's consistent with the liquids business too. We've got a number of pumps and number of compressors disperse throughout the liquids business unit that really fall into the same timing issue.

Christine Cho

Very helpful, thank you.

Operator

And next we have a question from Mirek Zak of Citi Group.

Mirek Zak

Hi, good morning, everyone. Can you guys give us a better idea of what all goes into your guidance range whether it's just simply timing or activity levels and if there's an implied commodity price range in there?

Mike Garberding

Yeah, Mirek. This is Mike. So when we think about the range, we think more about the question Christine brought up which is about around price activity on our business and recent opportunities not necessarily based drilling. So when you look at the range up range down that would more be related to price movement up and down related to our price exposure business, from an activity level, is pretty consistent with what Ben said, we have a pretty good idea of how to think about the activity level. And that activity level is driven more by the producer price forecast not ours.

Mirek Zak

Okay. And regarding our leverage change for 2018, at the 4.2 times level, is this something that you'd expect to remain only temporary and to decline fairly quickly not triggering any actions by the rating agencies or would you need to address this with some form of equity?

Eric Batchelder

Yeah I think that - Mirek, it's Eric. Thanks for that question. I think I'd say that the range that we gave we agree that's a wide range and really it's a function of the math of the guidance assuming no equity issue that would drive you to that 4.2 times. I think we continue to be very focused on maintaining our investment grade leverage, metrics and balance sheet and also maintaining that 3.5 to 4 times range. And I think we've done a great job of that through a really tough cycle in the last few years, so we would be continue to focus on doing that. So that that higher end is certainly something that's driven by math but we expect to live within a 3.5 to 4 times range and maintain the investment grade balance sheet.

Mirek Zak

Okay. And just lastly, can you give us an idea as to what assets you're now considering for us at sales and what's definitely not on the table and how that kind of balances with what you're expecting that issue on the ATM in 2018?

Mike Garberding

Yeah, Mirek. This is Mike. I would say it would look consistent as prior years. The example we always give is we did sell the North Texas pipeline about a little over a year ago for $85 million. It wasn't an asset that a lot of people focused on and it was an asset that made financial sense more to another party. That's the type of things we're talking about are probably things you're not primarily what you are saying. But we believe we have a balance of that and/or ATM really for that $190 million for the year. The big thing is that we've done a lot of the fund raising for this year with the preferred we did earlier.

Mirek Zak

Okay. Great. Thank you. Thanks for the time.

Operator

And the next question comes from Barrett Blaschke of MUFG Securities.

Barrett Blaschke

Hey, guys. With Cajun Sibon running full for 2018 and sort of probably having a long term outlook to being full, when do you sort of target a solution to continue to be able to build that business and give more liquids into the Louisiana market and I guess what do you think the ultimate size of that market is for you guys?

McMillan Hummel

Yeah. This is Mac. At this point, we probably don't have a lot of color to add beyond what Mike's remarks were earlier. We continue to look at what our options are to handle the increasing NGLs only from Oklahoma but from our Permian business. And the great news is we've got a lot of options and we continue to give each of those options the amount of due that we think that they are wanted given the level of attractiveness to us.

You mentioned in your question about handling those in Louisiana. I just mentioned that that is one of the options, but it's certainly not the only option. And so we'll continue to work through those and as Mike mentioned earlier, probably some sort of later year, midyear twenty 2018 decision timing.

Barrett Blaschke

Okay. Thank you.

Operator

And the next question comes from Craig Shere of Tuohy Brothers.

Craig Shere

Good afternoon. Christine's wider questioning the upper and lower EBITDA ranges, was there a bookmark you could provide at the upper and lower ends for what kind of commodity dips you're thinking about?

Mike Garberding

Yeah, you're in the range of sort of a plus or minus $5 to $10 when you think about it as far as the changes, gas price has as a lot smaller impact on us, it's really crude price and then ultimately the associated NGLs on that, but it is a pretty tight range on that.

Craig Shere

Okay. Great. And back on the question of potential drop of ENLCs Tall Oak and trust. On top of the other considerations already has them fall, how do you think that is trying to return the NLP to distribution growth?

Mike Garberding

Craig, this is Mike. We've been working at that long and hard and we think we're doing a lot of things that are pointing toward that namely you see the continued increase year-over-year of EBITDA I think over the last year somewhere between 15% to 20% per year. We restarted distributions at ENLC in the fourth quarter earlier and a lot of people thought and that was driven mainly by the conviction in the underlying business we're seeing. We're continuing to grow coverage ratio this year which we think is the right thing to do. And we said the past that we can start considering distribution increases when you get that coverage ratio north of 1.1 times. And so for us, what we think we're doing all those things to give us that opportunity to restart those distributions and feel good about that.

Craig Shere

Would you see a potential dropdown in terms of funding actually slowing that down or because it could be handled in units maybe not having much effect?

Mike Garberding

And so, that's a good question. So we think the right thing to do is to do something that makes economic sense for both and we know we have used units in cash in the past when dropdowns ultimately from even ENLC, ENLK and we'll evaluate that. But I think the main thing to take away is we're in a good position day with where we're at, we'll evaluate the drops even make sense as part of a longer sort of view of what we want from this business structurally but otherwise we're in a good position today with where we're at. I mean our focus is again growing the business of the seven strategies.

Craig Shere

Understood. And last question. Do you anticipate a sensation of the need to continue tapping the ATM before you would consider distribution growth?

Mike Garberding

This is Mike again. I think that will always be smart in raising capital, it's hard to say that that there's a black real hard test on that because it depends upon all the projects we're looking and opportunities we're looking at. So I don't think there's a hard line test on that. I think the way we've done it is to truly minimize equity as best we can. So for example, 2017 will have issued, we had an original goal of issuing 200 and the actual equity issued will be much less than that.

Craig Shere

Okay. Thank you very much.

Operator

And this concludes our question-and-answer session. I would like to turn the conference back over to Mike Garberding for any closing remarks.

Mike Garberding

Thank you, Laura for facilitating our call this morning and for everyone on the call today. Thank you for your participation and for your support. We'll be in touch in two weeks with our fourth quarter 2017 and full year 2017 results.

Operator

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.