EQT Midstream Partners, LP (NYSE: EQM), an EQT Corporation company, today announced its 2013 financial and capital expenditure forecast. Adjusted EBITDA is expected to be $80 - $83 million and distributable cash flow is expected to be $61 - $64 million. Operating revenues are seasonal, based on utility customer contracts, and will be approximately $2 million per quarter higher in the first and fourth quarters, than in the second and third quarters.
For 2013, EQT Midstream Partners, LP (the Partnership) forecasts total capital expenditures to be approximately $73 million, and intends to increase Equitrans transmission capacity by 450 MMcf per day. The Partnership expects maintenance and regulatory capital expenditures to vary quarter-to-quarter, primarily based on more activity when weather is favorable. The forecast does not include acquisition capital or financial impacts of potential acquisitions.
The Partnership forecasts expansion capital expenditures of $38 million for 2013. Approximately $25 million will be for the Low Pressure East Pipeline project, which will upgrade nearly 26 miles of existing pipeline in Greene, Washington and Allegheny counties of Pennsylvania. The project will add 150 MMcf per day of transmission capacity. The remaining expansion capital expenditures will fund new interconnects and dehydration upgrades, adding 300 MMcf per day of transmission capacity.
The Partnership forecasts ongoing maintenance capital expenditures of $17.2 million for 2013. Ongoing maintenance capital expenditures are cash expenditures made to maintain, over the long term, the Partnership’s operating capacity or operating income. Ongoing maintenance capital expenditures exclude funded regulatory compliance capital expenditures and reimbursable maintenance capital expenditures.
Funded Regulatory Compliance
The Partnership forecasts funded regulatory compliance capital expenditures of $12 million for 2013. Funded regulatory compliance capital expenditures relate to discrete expenditures necessary to comply with two specific regulatory compliance initiatives; system segmentation and isolation, and valve pit remediation. In order to fund these two initiatives, the Partnership retained $32 million from the initial public offering (IPO). Funded regulatory compliance capital expenditures do not impact the calculation of distributable cash flow.