Western Gas Partners LP intends to further develop its Delaware Basin and DJ Basin assets in 2018, according to a Dec. 5 news release outlining the next year's guidance.
The partnership plans to spend $1.0 billion to $1.1 billion in CapEx in the coming year, mainly focusing on further development of its infrastructure in the Delaware Basin and capacity expansion in the DJ Basin. The partnership also expects to put aside between $80 million and $90 million for maintenance capital expenditures.
Western Gas expects to use about 53% of its 2018 CapEx in the Delaware Basin, with 40% going to the DJ Basin. When broken down into segments, 57% of the CapEx would go to the partnership's gathering segment, 30% to its processing segment, 8% to maintenance, with the remaining 5% to equity investments and others.
Western Gas forecasts adjusted EBITDA of between $1.15 billion and $1.25 billion with its 2018 investments.
The partnership looks to provide a full-year distribution coverage ratio above 1.1x. Distribution growth of 1.5 cents per quarter through 2019 is also expected.
The 2018 outlook assumes that the Mentone train I will start up in the late third quarter of 2018, with train II following in the fourth quarter. It also assumes the DJ Basin extension and MGR fixed-price agreements with its sponsor company Anadarko Petroleum Corp. continue through 2018.
Anadarko also recently announced plans to spend the majority of its 2018 capital budget for operations at the Delaware and DJ basins, completing two regional oil treating facilities. Anadarko's midstream assets are expected to generate more than $300 million of adjusted EBITDA in 2018.
Western Gas Equity Partners LP also expects a distribution growth rate of about 12% based on Western Gas' expected distribution growth rate and assuming no equity issuances, according to the same release.
