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    ET
    Earnings call· Sep 2025(Q3 FY25)

    Energy Transfer LP ET

    Nov 5, 2025 Source

    Executive summary

    Energy Transfer Q3 FY25 — Strong Demand-Pull Growth and Strategic Project Advancements

    Energy Transfer delivered solid Q3 FY25 results, driven by record volumes across several segments and significant progress on strategic growth projects. The company is capitalizing on surging demand for natural gas from power plants and data centers, securing substantial long-term contracts and advancing major pipeline and storage expansions. While facing some segment-specific headwinds, management remains focused on capital discipline and high-return projects, positioning for continued earnings growth over the next decade.

    Highlights

    5

    • Adjusted EBITDA for Q3 FY25 was $3.84 billion, flat year-over-year excluding nonrecurring items, with year-to-date adjusted EBITDA up to $11.8 billion.

    • Achieved several volume records, including midstream gathering, NGL transportation, NGL/refined products terminal, and NGL export volumes.

    • Secured over 6 Bcf per day of new pipeline capacity contracts with demand-pull customers, generating over $25 billion in firm transportation fees over a weighted average life of 18+ years.

    • Fully contracted the 1.5 Bcf per day Desert Southwest pipeline under 25-year commitments and evaluating a 0.5-1 Bcf per day capacity increase.

    • Approved Mustang Draw II processing plant (250 MMcf/day, $260 million) and Price River Terminal expansion ($75 million) to support Permian growth.

    Concerns

    5

    • Adjusted EBITDA for Q3 FY25 was $3.84 billion, slightly below Q3 FY24's $3.96 billion (before non-recurring item adjustment).

    • Midstream adjusted EBITDA decreased to $751 million from $816 million YoY, primarily due to a non-recurring business interruption claim in Q3 2024.

    • Interstate natural gas adjusted EBITDA decreased to $431 million from $460 million YoY, excluding a $43 million tax accrual resolution.

    • Intrastate natural gas adjusted EBITDA decreased to $230 million from $329 million YoY, due to reduced pipeline optimization from a shift to long-term contracts.

    • Full-year 2025 adjusted EBITDA is expected to be slightly below the lower end of the $16.1 billion to $16.5 billion guidance range.

    Guidance & targets

    10
    CategoryTargetConfidence
    Organic growth capital projects
    $4.6 billion
    high materiality
    High
    Organic growth capital projects
    approximately $5 billion
    high materiality
    High
    Adjusted EBITDA
    slightly below the lower end of the guidance range
    high materiality
    High
    Desert Southwest pipeline capacity increase
    0.5 Bcf to 1 Bcf
    medium materiality
    Medium
    Lake Charles LNG Final Investment Decision (FID)
    Contingent on securing 80% equity partners and converting HOAs to SPAs
    high materiality
    Low
    Dakota Access Canadian crude project FID
    by mid-2026
    medium materiality
    High
    Mustang Draw II processing plant in-service
    Fourth quarter of 2026
    medium materiality
    High
    Price River Terminal expansion in-service
    fourth quarter of 2026
    medium materiality
    High
    Bethel natural gas storage cavern in-service
    late 2028
    medium materiality
    High
    Oracle data centers first flow
    by the end of the year
    medium materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    NGL and refined products
    Adjusted EBITDA was $1.1 billion compared to $1 billion for the third quarter of last year, driven by higher throughput across Gulf Coast and Mariner East pipeline operations, as well as terminals.
    		———$1.1 billion
    Midstream
    Adjusted EBITDA was $751 million compared to $816 million for Q3 2024. Excluding a $70 million non-recurring business interruption claim in Q3 2024, results would have been up due to higher Permian Basin volumes (up 17%) from processing plant upgrades, new plants, and WTG assets, partially offset by lower dry gas gathering.
    Permian Basin volumes: up 17%
    		———$751 million
    Crude oil
    Adjusted EBITDA was $746 million compared to $768 million for Q3 2024. Growth across several crude pipeline systems, including the Permian joint venture with SUN, was offset by lower transportation revenues on the Bakken pipeline and Bayou Bridge due to refinery turnarounds.
    		———$746 million
    Interstate natural gas
    Adjusted EBITDA was $431 million compared to $460 million for Q3 2024. Excluding a $43 million increase related to a prior period ad valorem tax obligation resolution, results would have been up due to higher demand on several interstate pipeline systems.
    		———$431 million
    Intrastate natural gas
    Adjusted EBITDA was $230 million compared to $329 million in Q3 2024. Increased volumes across the Texas intrastate pipeline system due to third-party growth were offset by reduced pipeline optimization from a continued shift to more long-term third-party contracts.
    		———$230 million

    Operational metrics

    18
    Adjusted EBITDA
    $3.84 billionflat year-over-year (excluding nonrecurring items)
    Q3 FY25

    Compared to $3.96 billion for Q3 FY24.

    Adjusted EBITDA
    $11.8 billionup from $11.6 billion
    YTD FY25

    Compared to $11.6 billion for the same period in 2024.

    Distributable cash flow attributable to partners (as adjusted)
    approximately $1.9 billion
    Q3 FY25

    Non-GAAP financial measure.

    Organic growth capital spent
    approximately $3.1 billion
    first 9 months of 2025

    Primarily in NGL and refined products, midstream, and intrastate segments, excluding SUN and USA Compression CapEx.

    Permian Basin processed volumes growth
    17%YoY
    Q3 FY25

    Due to processing plant upgrades and new plants placed into service, as well as the addition of WTG assets in July 2024.

    Texas cross haul capacity sold
    over 90%
    Q3 FY25

    Includes Hugh Brinson and other pipeline flows from the Permian Basin to markets in the East, with majority extending through the remainder of the decade.

    Natural gas supply to Oracle data centers
    approximately 900,000 Mcf per day
    future

    Under multiple long-term agreements, supply sourced from intrastate pipeline network.

    Initial gas supply to Fermi America
    approximately 300,000 MMBtus per day
    future

    Subject to Fermi's election, includes pipeline interconnection and exclusivity.

    Firm transportation service to Entergy Louisiana
    250,000 MMBtus per day
    future

    Subject to limited conditions precedent, includes option for Entergy to expand capacity.

    Pipeline capacity contracted (demand-pull customers)
    over 6 Bcf per day
    within the last year

    Includes volumes from end users, data centers, and utilities off of Desert Southwest, Hugh Brinson, and other natural gas directed projects.

    Mustang Draw II processing plant capacity
    250 million cubic foot per day
    future

    Expected to be in service in Q4 2026.

    Price River Terminal heated storage capacity
    approximately 120,000 barrels
    future

    Part of the terminal expansion project, expected in service Q4 2026.

    Southern Illinois Connector Project capacity
    100,000 barrels per day
    future

    Contracts for transportation of Canadian crude oil to Nederland from Flanagan and Hardisty; FID taken.

    Dakota Access Canadian crude capacity
    approximately 250,000 barrels per day
    future

    Project with Enbridge, FID expected by mid-2026.

    Bethel working gas storage capacity
    over 12 Bcfdoubles
    future

    Result of new storage cavern construction, with ability to develop at least 15 Bcf of additional storage capacity.

    Hugh Brinson pipeline capacity
    2.2 Bcf per day
    future

    Bidirectional system, with 1 Bcf per day from East to West.

    Desert Southwest pipeline capacity
    1.5 Bcf per day
    future

    Fully contracted, evaluating options for a potential increase in capacity by 0.5-1 Bcf/day.

    LPG export capacity contracted
    over 95%
    through end of decade

    Flexport NGL Export Expansion Project previously placed into ethane and propane service, now ready for ethylene export service.

    Industry KPIs

    5
    MetricValueDetails
    Pipeline throughput storage1.5 Bcf/dayBcf/day
    Sanctioned expansion backlog$260 millionUSD
    Basin level production volume17%%
    Take or pay contract structureover 18 yearsyears
    Distributable cash flow per unit shareapproximately $1.9 billionUSD

    Orderbook & backlog

    2
    Pipeline capacity contracts (demand-pull)>6 Bcf per dayQ3 FY25

    Expected to generate >$25 billion revenue from firm transportation fees over a weighted average life of >18 years.

    Lake Charles LNG contracted volumes15 million to 15.5 million tonsQ3 FY25

    Very close to target, but some are still Heads of Agreement (HOAs) that need to be converted to binding Sales and Purchase Agreements (SPAs) by year-end.

    Deals & partnerships

    6
    OracleNatural gas supply agreements for data centerslong-term

    Multiple agreements to supply natural gas to 3 U.S. data centers, 2 of which are in Texas. First flow expected by year-end, final completion mid-2026.

    Fermi AmericaPipeline interconnection and gas supply for hypergrid campus10-year agreement

    Agreement to exclusively provide initial gas supply to Fermi's hypergrid campus located outside of Amarillo, Texas, subject to Fermi's election.

    Entergy LouisianaFirm transportation service for power facilities20-year binding agreement

    Agreement to fuel facilities in Richland Parish, Louisiana, subject to limited conditions precedent. Agreement would begin in December 2028 and includes an option for capacity expansion.

    MidOcean EnergyEquity ownership in Lake Charles LNG

    Energy Transfer is in advanced discussions for MidOcean Energy's participation, with a target to reduce Energy Transfer's equity interest to 20% by selling remaining equity to other parties.

    EnbridgeSouthern Illinois Connector Project for Canadian crude transportation

    Completed a successful open season for the project, connecting Enbridge's pipeline near Wood River to Energy Transfer's assets in Patoka, Illinois, to support delivery of Canadian crude oil to U.S. refineries. FID has been taken.

    EnbridgeCanadian crude oil transportation through Dakota Access pipeline15-year agreements

    Working with Enbridge to provide much needed capacity for oil out of Canada, aiming for 15-year agreements with Canadian producers to keep Dakota Access full for a long time.

    Capital programs

    8
    Desert Southwest pipeline projectunderway

    Benefit: 1.5 Bcf/day (evaluating increase to 2-2.5 Bcf/day)

    Strategic expansion of Transwestern Pipeline, fully contracted under long-term commitments, evaluating capacity increase due to significant interest.

    Hugh Brinson Pipeline Phase 1underway
    Spent to date: 100% of right of way acquired, >85% of pipe delivered

    Construction is underway on all 5 spreads of Phase 1.

    Hugh Brinson Pipeline Phase 2approved

    Benefit: 2.2 Bcf/day West to East, 1 Bcf/day East to West

    Includes additional compression, will be bidirectional, providing significant optionality.

    Bethel natural gas storage cavernapproved

    Benefit: doubles working gas storage to >12 Bcf

    Expansion will increase equity gas storage capabilities to serve growing demand and strengthen reliability.

    Mustang Draw II processing plantapproved$260 million

    Benefit: 250 MMcf/day

    Supported by continued growth from existing customers, includes spend related to additional gathering and downstream pipeline infrastructure.

    Price River Terminal expansionunderway$75 million

    Benefit: doubles export capacity, 120,000 barrels heated storage

    Backed by an agreement with FourPoint Resources, includes new railcar loading facilities and additional storage unit tracks.

    Southern Illinois Connector ProjectFID taken

    Benefit: 100,000 bbl/day

    Joint project with Enbridge, connecting Enbridge's pipeline near Wood River to Energy Transfer's assets in Patoka, Illinois, to support Canadian crude oil delivery.

    Dakota Access Canadian crude projectproposed

    Benefit: 250,000 bbl/day

    Project with Enbridge to provide capacity for Canadian crude oil through the Dakota Access pipeline.

    Risks & headwinds

    6
    Midstream segment adjusted EBITDA impact from prior year non-recurring itemQ3 FY25 (comparison to Q3 FY24)

    $70 million

    Mitigation: Midstream results would have been up compared to Q3 FY24 due to higher Permian volumes, absent this claim.

    Crude oil transportation revenue declineQ3 FY25

    Lower transportation revenues

    Mitigation: Refinery turnarounds on Bayou Bridge have since been completed, and volumes have returned to normal levels.

    Intrastate natural gas pipeline optimization reductionQ3 FY25

    Reduced pipeline optimization

    Mitigation: Shift to more long-term third-party contracts, which are expected to provide more stable revenues at good rates over the next 10-plus years.

    Lake Charles LNG Final Investment Decision (FID) uncertaintyby year-end

    Contingent on securing 80% equity partners and converting HOAs to SPAs

    Mitigation: Management is actively working to secure equity partners and convert agreements, emphasizing capital discipline and risk/return criteria. Acknowledges potential need to renew EPC contract.

    NGL pipeline economics and competitionend of this decade

    Fees get more and more tight and more competitive

    Mitigation: Evaluating converting one of the Permian NGL pipelines to natural gas service, which could potentially double revenue.

    Full-year 2025 Adjusted EBITDA slightly below guidanceFY25

    Slightly below the lower end of $16.1 billion to $16.5 billion

    Mitigation: Organic growth capital projects for FY25 reduced to $4.6 billion from $5 billion due to project forecast reductions and spending deferrals into 2026.

    What to watch in Q4 FY25

    5

    Lake Charles LNG FID progress

    by year-end
    CurrentAdvanced discussions with MidOcean Energy (30% equity), target 20% ET equity, HOAs to SPAs conversion ongoing.
    TargetFID taken with 80% equity partners secured and binding offtake agreements.

    Why it matters

    Successful FID on Lake Charles LNG is a major growth catalyst and demonstrates capital discipline in large-scale projects.

    we will not proceed with LNG until we have secured 80% of equity partners similar to ourselves. And we've got some work to do that... we're not going to get to FID until we have the required amount of equity partners that we need.

    Q&A highlights

    6

    Does the updated FY25 adjusted EBITDA guidance (slightly below the lower end of $16.1B-$16.5B) include SUN's acquisition of Parkland?

    The guidance does not include Parkland; it refers to the company's performance without that acquisition.

    “For the guidance, we have not included Parkland in there. So we're saying without Parkland, we expect to be slightly below the initial [ guide ].”

    asked by Keith Stanley · answered by Dylan Bramhall

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Focus on Natural Gas Demand

    Energy Transfer is actively leveraging its extensive natural gas pipeline network to meet growing demand from gas-fired power plants and data centers. The company has secured over 6 Bcf per day of new pipeline capacity contracts with demand-pull customers, representing over $25 billion in firm transportation fees over 18+ years. This includes significant agreements with Oracle for 900,000 Mcf per day and Fermi America for 300,000 MMBtu per day, highlighting the strategic importance of projects like Hugh Brinson and Desert Southwest.

    02

    Pipeline Expansion and Optimization

    The Desert Southwest pipeline, now fully contracted for 1.5 Bcf per day under 25-year terms, is evaluating a potential capacity increase of 0.5-1 Bcf per day. Phase 1 of the Hugh Brinson Pipeline is on track for Q4 2026 in-service, with Phase 2 adding compression for bidirectional flow (2.2 Bcf/day W-E, 1 Bcf/day E-W). The company is also considering converting one of its NGL pipelines from the Permian to natural gas service, anticipating potentially double the revenue compared to NGL transportation due to increasing demand.

    03

    Storage Capacity Enhancement

    To further strengthen system reliability and capitalize on pricing volatility, Energy Transfer is expanding its Bethel natural gas storage facility. A new cavern, expected in service in late 2028, will double working gas storage capacity to over 12 Bcf, with potential for an additional 15 Bcf. This expansion is critical for providing reliable gas supply to data centers and other demand sources, especially during periods of high demand or supply interruptions.

    04

    Permian Basin Growth and Downstream Integration

    The company continues to expand its Permian processing capabilities, with Lenorah II running at full capacity and Badger ramping up. Mustang Draw II, a new 250 MMcf per day processing plant, was approved for Q4 2026 in-service, costing approximately $260 million. These expansions are designed to feed the downstream pipeline network, including NGL lines and fractionators, supporting overall volume growth.

    05

    Crude Oil Segment Developments

    In the crude oil segment, an expansion at the Price River Terminal in Utah, costing $75 million and expected in service Q4 2026, will double its export capacity. Energy Transfer also took FID on the Southern Illinois Connector Project with Enbridge, securing 100,000 bbl per day of Canadian crude transportation. Discussions are ongoing for another project with Enbridge to transport 250,000 bbl per day of Canadian crude via the Dakota Access pipeline, with FID expected by mid-2026, aiming to keep the pipeline full for many years.

    06

    Lake Charles LNG Update

    The Lake Charles LNG project is in advanced discussions with MidOcean Energy for a 30% equity stake, with a target to reduce Energy Transfer's equity interest to 20%. Final Investment Decision (FID) is contingent on securing the remaining equity partners and converting non-binding heads of agreement into binding offtake agreements, reflecting the company's strong focus on capital discipline and risk/return criteria.

    AI-generated summary of the company’s earnings call. Not investment advice.