Midstream - Pipelines

Targa's Grand Prix In Full Service

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Targa Provided an update on its projects.

Growth Projects Update

Since the end of the first quarter 2019, the Company has completed and commenced operations on a number of its major growth projects, aggregating to approximately $3 billion of growth capital projects placed in-service, including:

• 250 million cubic feet per day (“MMcf/d”) Hopson Plant in Permian-Midland;
• 100 thousand barrels per day (“MBbl/d”) Train 6 fractionator in Mont Belvieu;
• 20-inch NGL pipeline from Mont Belvieu to the Company’s Galena Park Marine Terminal;
• 200 MMcf/d Little Missouri 4 Plant in Badlands;
• Grand Prix NGL pipeline (“Grand Prix”) with service into Mont Belvieu; and
• 250 MMcf/d Pembrook Plant in Permian-Midland (in start-up).

Grand Prix recently commenced full operations, consistently flowing between 150 to 170 thousand barrels per day to Mont Belvieu. Our expectation is for volumes to increase to approximately 200 thousand barrels per day in September, then further increase over the balance of 2019 as short-term third party transportation arrangements continue to roll off and additional gathering and processing facilities come online. Grand Prix will provide some partial margin contribution in the third quarter, and as volumes continue to increase, the fourth quarter will be the first full quarter of margin contribution.

As a result of longer than anticipated time related to permitting, coupled with weather related construction delays during critical periods, Grand Prix came online about two months delayed and costs were approximately 10 percent higher than our initial estimates provided over two years ago. Additionally, over the past year we have experienced higher labor costs that have increased the cost of recently completed gas processing plant expansions and those underway.