Good morning, and welcome to the 2025 Third Quarter Conference Call for Genesis Energy. Genesis Energy has 3 business segments. The Offshore Pipeline Transportation segment is engaged in providing the critical infrastructure to move oil produced from the long-lived low-cost reservoirs in deepwater Gulf of America to onshore refining centers. The Marine Transportation segment is engaged in the maritime transportation of primarily refined petroleum products. The Onshore Transportation and Services segment is engaged in the transportation, handling, blending, storage and supply of energy products, including crude oil and refined products, primarily around refining centers as well as the processing of sour gas streams to remove sulfur at refining operations. Genesis's operations are primarily located in the Gulf Coast states and the Gulf of America. During this conference call, management may be making forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. The law provides safe harbor protection to encourage companies to provide forward-looking information. Genesis intends to avail itself of those safe harbor provisions and directs you to its most recently filed and future filings with the Securities and Exchange Commission. We also encourage you to visit our website at genesisenergy.com, where a copy of the press release we issued this morning is located. The press release also presents a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures. At this time, I would like to introduce Grant Sims, CEO of Genesis Energy, L.P. Mr. Sims will be joined by Kristen Jesulaitis, Chief Financial Officer and Chief Legal Officer; Ryan Sims, President and Chief Commercial Officer; and Louie Nicol, Chief Accounting Officer. And with that, I'll now turn the call over to Grant.
Thanks, Dwayne. Good morning to everyone, and thanks for listening to the call. As noted in our earnings release this morning, our third quarter results were broadly in line with our expectations in spite of a few pluses and minuses across our businesses. On the positive side, our Offshore Pipeline Transportation segment started to really shine as it benefited from several factors, including the absence of any weather-related disruptions, the resolution of a number of the producer mechanical issues we have experienced over the past 12 to 18 months and the recognition of the minimum volume commitments to SYNC and CHOPS associated with the new Shenandoah Floating Production Unit, or FPU. On the other hand, our Marine Transportation segment faced some temporary challenges in July and the first part of August due to some short-term market conditions that affected both day rates and utilization levels. That said, we believe these headwinds are largely subsided as financial results in both September and October returned to levels consistent with the first half of the year. This improvement positions us for a more in-line fourth quarter and some momentum heading into next year from our Marine group. With a sequential 16% improvement, the third quarter offered a glimpse of what's ahead for our Offshore Pipeline Transportation segment. First, in late July, we received first oil from the new Shenandoah floating production unit. Then at the end of September, the operator of Salamanca announced it commenced production from the first of 3 predrilled wells with plans to relatively quickly ramp production to a total level of some 40,000 barrels a day, with expectations to drill another well and further increase production to the original design capacity of 50 kbd in the first half of next year. The financial results reported today only reflect the minimum volume commitments from Shenandoah and essentially, no contribution from Salamanca. Of note, in early October, the operator of Shenandoah announced the successful completion of the ramp-up of its 4 Phase 1 development wells to their cumulative target rate of 100,000 barrels per day, which is well above the minimum volume commitment level, just 75 days after initial start-up. We remain extremely encouraged by the successful start-up and ramp of both the Shenandoah and Salamanca new FPUs, which are now delivering oil to our 100% owned and operated SYNC and SEKCO laterals, respectively. These laterals deliver these volumes to our 64% owned and operated CHOPS and/or Poseidon crude oil pipelines for further transportation to onshore delivery points. There is no doubt these two developments will contribute to a significant increase in the future financial performance of our Offshore Pipeline Transportation segment. When combined with minimal future growth capital expenditures and the expected steady, if not marginally growing performance from our other businesses, we remain well positioned to generate increasing amounts of free cash flow in excess of the cash cost of running our businesses. In fact, I can report we generated excess cash in the third quarter from which we were able to further reduce outstanding borrowings under our senior secured revolving credit facility, and we fully expect to continue to do so in the fourth quarter. Looking forward, the combination of growing total segment margin and lower absolute debt should produce a clear trajectory of significant and rapid improvement in our leverage ratio throughout 2026 and provide us with the foundation and financial flexibility to deliver meaningful long-term value for all of our stakeholders in future periods. With that, I'll go into a little more detail on each of our business segments. As mentioned, our Offshore Pipeline Transportation segment again saw a sequential improvement in both volumes and segment margin. Several of the previously impacted offshore wells that have been down due to producer mechanical issues were brought back online and are now flowing again on our pipelines. While one relatively high-margin field continues to have some lingering challenges impacting some 10 to 15 kbd of production, we are confident the operator is focused on restoring the impact of production as quickly as is feasible. If the existing wells cannot be fully remediated, we believe we could possibly see an acceleration of the development of at least one other subsea discovery, which will be tied back to the subject FPU with all of its production flowing through our pipelines in 2026 in any event. We saw a steady ramp in volumes from the Shenandoah FPU during the quarter, which in early October reached its targeted production rate of 100 kbd from its 4 Phase 1 wells. Given additional wells that have already been sanctioned at Shenandoah, Monument and Shenandoah South, we would reasonably expect total throughput to grow to as much as 120 kbd and possibly 10 to 20 kbd higher by the end of 2026 or early in 2027. As mentioned earlier, the operator commenced production off the Salamanca FPU at the end of September, and is working to establish production from its first 3 wells. The operator is in the process of cleaning up these 3 wells and lining out the production facilities on the new FPU, which, as a reminder, was our previously deployed Independence Hub deepwater platform we sold to them in May of 2022. The repurposed platform not only accelerated the date of first oil and reduced the total development cost, but it also reduced the environmental footprint of the Salamanca development relative to the option of constructing a new deepwater production facility. We expect volumes from these initial 3 wells to continue to ramp and approach approximately 40,000 barrels a day in the near future. The fourth well is planned to be drilled and completed in the second quarter of 2026, at which point Salamanca production levels are anticipated to approach the original design capacity of 50 kbd. The operator now believes that the Salamanca FPU can likely handle as much as 60,000 barrels a day of oil. As such, there is a developing scenario that a fifth well could be drilled, completed and turned to production in late 2026 or early 2027, at which point total production could be as much as 20% higher than what was originally anticipated at the time of making the decision to sanction the Salamanca project. The addition of new volumes from both Shenandoah and Salamanca has meaningfully increased the total throughput we transport to shore on our CHOPS and Poseidon pipelines. Total throughput on these two main pipeline systems has exceeded 700,000 barrels a day in recent days, and we reasonably expect volumes to regularly surpass this level as both projects reach their full potential and additional developments are tied back and brought online. Let me try to put this in perspective, at least in the context of current and future activity in the Central Gulf of America. At 750,000 barrels a day of average daily throughput on Poseidon and CHOPS, which we expect once Shenandoah and Salamanca are fully ramped, we will move approximately 275 million barrels of oil over a 1-year period. At a conservative average economic ultimate recovery of 25 million barrels of oil per deepwater well, we need to have the producing community drill, complete and tie back to FPUs currently connected to our infrastructure, only 11 or so wells per year to, in essence, fully replace the reserves produced and transported through our pipelines in any one year. This, in turn, simply extends or annuitizes our ability to produce these anticipated 2026 type run rate financial results from our offshore segment for many years, if not decades in the future without having to spend any money. As we sit here today, we are aware of 10 wells that have either already been drilled or are in the process of being drilled and which are scheduled to be turned to production from dedicated leases in 2026. Currently, almost half of the entire fleet of deepwater rigs working in the Gulf are drilling on dedicated leases. We are confident that more than 10 currently identified wells will be drilled as we go through 2026, further adding to the backlog, so to speak, of future throughput and financial contribution from our offshore segment. We are very encouraged with the early results from Shenandoah and Salamanca. The success at Shenandoah as well as other recent industry commentary about other high-pressure, high-temperature opportunities in the Gulf of America is extremely exciting. We believe there is a positive read-through for additional significant discoveries and opportunities, specifically around our existing pipeline infrastructure in the Central Gulf of America. In fact, it is very likely we are in the early innings of a multi-decade opportunity set in which we are in an enviable position with strategically located, installed, paid for and available pipeline capacity to shore. In that regard, it's important to note that the current nameplate capacity of the Shenandoah FPU represents only about 50% of SYNC's capacity and roughly half of the incremental capacity we and our partner have added on to the CHOPS pipeline. We continue to engage in robust commercial discussions with producers across the Central Gulf of America, and we believe Genesis is uniquely positioned as the only truly independent third-party provider of crude oil pipeline logistics in the region, setting the stage for continued growth in decades and decades of opportunities out of this world-class basin. Our Marine Transportation segment performed slightly below our expectations, primarily due to temporary market conditions. Demand for our inland or brown-water fleet was modestly impacted during the first half of the third quarter as Gulf Coast refiners maximize runs of light crude oil, which temporarily reduces supply of intermediate black oil needed to be transported. The shift in refinery feedstock was largely driven by the narrowing discount of heavier crude grades relative to light crude, prompting refiners to favor lighter barrels. Public filings from several independent refiners confirm this trend, showing a notable decline in medium and heavy feedstock volumes, consistent with what we observed in the market. As noted last quarter, we have been closely monitoring when Gulf Coast refiners might return to heavier crude slates, including Venezuelan barrels. Early third-quarter earnings commentaries from refiners such as Valero have been encouraging. To quote directly from Valero's recent call on medium sours, we had seen discounts as narrow as 2.5%, that's widened out closer to an 8% discount. So discounts have certainly moved to the point where we are seeing an economic benefit in our system to running medium and heavy sour crudes. Our expectation is you'll continue to see those widen. Then as medium sour discounts widen, you'll see heavy sours react to remain competitive with medium sours. So we anticipate that to continue to happen as we move through the fourth quarter. We also have Venezuelan barrels back in the mix, which is helping. I think you'll see in the fourth quarter a heavier crude diet than what we had in the third quarter, filling out a lot of our conversion capacity. Based on this commentary, we are confident that Gulf Coast refiners are responding to wider heavy crude discounts and shifting back towards heavier crude slates. This transition should generate more refinery bottoms along the Gulf Coast, increasing demand for our inland heater barges through year-end and on into 2026. Meanwhile, conditions in our blue water fleet were a little softer in the first part of the quarter. Operators continued relocating equipment from the West Coast to the Gulf Coast and Mid-Atlantic trade lanes, in part based upon the coming closure of approximately 17% of California's refining capacity, specifically Phillips 66 Los Angeles area refinery by late 2025 and Valero's Northern California refinery by early 2026. These relocations temporarily increase the available supply of larger vessels in our operating markets, temporarily pressuring both utilization and day rates. However, we think all such relocated vessels have now found a home, and we do not expect these shifts to cause any lasting structural change in the blue water market. 8 of our 9 blue water vessels are contracted through year-end with several extending well into 2026, helping to mitigate any near-term volatility as the market continues to absorb this tonnage. Overall, we remain confident in the long-term fundamentals of the marine transportation sector. With effectively zero net new supply of our classes of Jones Act vessels and the high cost and long lead times required to construct new equipment, the market remains structurally tight. As demand continues to improve across both our brown and blue water fleets, we expect our Marine Transportation segment to recover in the fourth quarter and deliver stable to modestly growing contributions in the years ahead. Our Onshore Transportation and Services segment performed as expected during the quarter. We are seeing increasing volumes through our Texas and Raceland terminals and pipelines. We expect this trend to continue as volumes from both Shenandoah and Salamanca access our onshore pipeline systems for further distributions to refineries and downstream markets in both Texas and Louisiana, which we serve both directly and indirectly. Our legacy refinery business performed in line with expectations. As we have emphasized over the last several years, 2025 has always been about reaching the inflection point we have all been anticipating. I can confidently say as our financial performance continues to grow and we generate increasing amounts of free cash flow in coming years. We remain firmly focused on creating long-term value for all our stakeholders. Our approach to capital allocation will be measured and deliberate with a priority of absolute debt reduction, opportunistic redemption of our high-cost corporate preferred securities and a thoughtful evaluation of future increases in our quarterly distributions to common unitholders. As we begin returning capital, we will continue to act with patience, discipline, and balance, ensuring we maintain the financial flexibility as well as liquidity needed to evaluate and pursue any accretive opportunities as they may arise. Finally, I'd like to say that the management team and the Board of Directors remain steadfast in our commitment to building long-term value for all our stakeholders regardless of where you are in the capital structure. We believe the decisions we are making reflect this commitment and our confidence in Genesis moving forward. I'd once again like to recognize our entire workforce for their individual efforts and unwavering commitment to safe and responsible operations. I'm extremely proud to be associated with each and every one of you. With that, I'll turn it back to the moderator for questions.
