Summit Midstream Lifts EBITDA 12% on Rockies Growth, Raises Capex Outlook
The pipeline operator posted $60.7 million in adjusted EBITDA for the second quarter, up 12% from the prior period, as Rockies segment earnings surged 20% year-over-year.
Summit Midstream Partners (SMC) reported second-quarter adjusted EBITDA of $60.7 million, a 12% increase from the first quarter, though the figure slipped marginally from $61.1 million a year earlier. The natural-gas and liquids-gathering partnership swung to net income of $4.6 million from a $4.2 million loss in the year-ago period, while total revenue rose 10.6% to $155.0 million.
The sequential gain was driven largely by the Rockies segment, where adjusted EBITDA climbed to $30.4 million, up $4.0 million from the first quarter and 20% higher than the $25.2 million posted in the second quarter of 2024. Higher liquids throughput, up 6.3% sequentially, and improved realized crude-oil and NGL prices powered the increase, even as natural-gas volumes in the segment declined 3%. The Mid-Con segment also contributed, with natural-gas throughput rising 9.9% sequentially to 523 MMcf/d and segment EBITDA gaining $2.0 million to $21.4 million, aided by 17 new Barnett and three new Arkoma well connections.
Not every basin moved in the same direction. Piceance segment EBITDA fell $0.9 million sequentially to $8.7 million as volume throughput dropped 5.7%, reflecting temporary shut-ins, natural production declines, and no new well connections during the quarter. Year-over-year, Piceance volumes were down 19% and EBITDA declined 17%. All shut-in production had resumed flowing by the end of July. Across the system, aggregate natural-gas throughput slipped 1.4% year-over-year to 899 MMcf/d and liquids throughput fell 12.8% to 68,000 barrels a day.
The Permian segment offered a bright spot within that mixed picture. Double E pipeline volumes rose 6.7% sequentially to 859 MMcf/d, a 26% increase from 682 MMcf/d a year ago, pushing segment EBITDA up $0.6 million to $9.4 million. Summit extended an open season on the Double E system through the end of August, reporting 250 MMcf/d of new open-season commitments and total contracted capacity of roughly 1.9 Bcf/d.
Summit tightened its full-year 2024 adjusted EBITDA guidance to a range of $235 million to $255 million and raised total capital-expenditure guidance to between $100 million and $120 million, up from a prior range of $85 million to $105 million. The higher spending reflects 30 additional Williston Basin well connections beyond the original plan and incremental Double E capital. Eight rigs are currently operating across the Rockies — six in the Williston and two in the DJ Basin — with roughly 75 drilled-but-uncompleted wells, which is the most active Williston drilling program in several years. The incremental wells are expected to connect primarily in the fourth quarter.
Distributable cash flow rose 13.6% year-over-year to $36.8 million. Summit established an inaugural $35 million stock-repurchase program during the quarter, buying back roughly 34,600 shares for about $1.0 million and leaving $34.0 million in remaining capacity. The company ended June with $21.0 million of cash, more than double the $9.3 million on hand at year-end 2023, and a total leverage ratio of 4.1 times, with interest coverage of 2.7 times against a 2.0-times covenant minimum.
One headwind looms for the Piceance segment: minimum-volume-commitment shortfall payments that contributed $4.2 million to second-quarter EBITDA expire at the end of the third quarter. Separately, cost of natural gas and NGLs climbed 36.7% year-over-year to $49.1 million, outpacing the 10.6% revenue increase and compressing margins across the system.