Now turning to Slide 7. As we have said, one of the main value drivers behind this transaction are the incremental minimum well commitments from CNX and HG. This chart and slide walks you through those in detail. The table on the top shows all the committed activity through CNX Midstream over the next 6 years or so. But I'd like to call out the incremental wells in the green boxes. CNX has agreed to commit a total of 40 additional wells. That would be 15 more by the end of 2020 and 25 on top of that by 2023. And HG has committed to 12 wells by year-end 2021. This stacked bar chart on the right of this slide shows the cumulative revenue that would come from the commitments, assuming only the penalties are paid alongside of our PDP revenue as well. And it is important to note, when those wells are actually developed, instead of the penalty payment, the potential revenue is much higher than what is shown here. Another item of note is that the cumulative total is around $1.4 billion in revenue by year-end 2023. And if you were to run this chart out over 30 years, it is somewhere around $3 billion of committed revenues, as we stand here today, including the PDP forecast.
The bottom of Slide 7 also shows some enhancements to the GGAs that we made. First, beyond the well commitments, we made some enhancements to what was already solid GGAs for DevCo I. In the new GGAs, delivery points are fixed where infrastructure is already built out, allowing us to generate extremely high returns and also CNX now has a lot more control over how to utilize its systems. And second, the release of the HG acres in DevCo's II and III ensures that CNX CNXM can focus its capital on the higher return Southwest PA areas of DevCo I.
Now looking at Slide 9. Just to reference the inventory that our sponsor got in this transaction, our sponsor got 70 new Marcellus locations, primarily in the wet gas window of DevCo I, with, obviously, Utica acreage on top of that. I just want to highlight this because it is critical point not just for the sponsor, but also for the MLP, as it means further potential upside to activity in the highest margin DevCo I area over the near term. A wet Marcellus well in DevCo I utilizing existing infrastructure creates substantial returns and distributable cash flow for our unitholders.
On Slide 10, we have the remaining roster of dropped candidates. Note that every asset on this list is now fully controlled by CNX. Like I mentioned earlier, this transaction increases the speed, magnitude and organic ability to get these drops done. It is also important to note that going forward, you can expect third-party opportunities to be primarily done inside of the MLP 100% versus the 95%, 5% structures of the DevCos.
To close out, on slide 11 we are reaffirming our 5-year financial guidance that we issued at our March Analyst Day. With that said, this deal did just closed yesterday. And we will continue to work with our sponsors on any revisions going forward.
With that, I will hand it back to Tyler. Oh, I'll hand it to Tim.
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Timothy C. Dugan, CNX Midstream Partners LP - COO & Director [5]
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Thanks, Don and good morning, everyone.
As Nick highlighted, in the first quarter of 2018, we saw a number of improvements and the partnership turned in line 12 wells in DevCo I compared to 10 wells in the same quarter of 2017. Most notably in Q1, CNXM continued to see cost reductions in what is typically a higher-than-average cost quarter. In fact, when you go back and look at how the team has performed this quarter and compare results to prior years, what you see is a sequential cost reduction, not just unit cost reduction, as you would expect, but total dollar cost reduction. We're really proud of the work that's been done over the past several months and we would like to congratulate the entire team on a job well done.
So let's talk about some of the ways the team was able to accomplish these cost reductions. First, as we've discussed in the past, our team has moved away from working-by-routine and have been shifting to a work-by-exception protocol. We've also expanded our control rooms' remote control capabilities. Our efforts to centralize data coming in from the field allows us to more quickly identify and address recurring problems. These combined efforts have allowed us to reduce our footprint in total man-hours, driving significant labor and facility cost savings.
Secondly, we're using 100% of our compression capacity. This increases compression efficiency substantially, as we don't need to idle unused compression equipment as a reaction to slower activity. Also, the series of debottlenecking projects have lowered line pressures, which reduces the need for costly maintenance and chemical treatments. And then finally, we've aligned our operation teams' incentive compensation with our EBITDA goals, incentivizing the entire group to continue to focus on cost and throughput. This has led to other modest changes and accumulatively have made a significant difference. All of these actions, though critical to mitigating seasonal first quarter cost increases, have actually helped to permanently shift the cost structure of the business. These are the efforts that are helping to drive EBITDA and cash distribution growth.
And with that, I will turn it over to Tyler.
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Donald Rush, [6]
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Great. Thanks, Tim. Danielle, if you can open the line up for Q&A at this time, please.
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Questions and Answers
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Operator [1]
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(Operator Instructions) The first question comes from Jeremy Tonet with JPMorgan.
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Rahul Krotthapalli, JP Morgan Chase & Co, Research Division - Analyst [2]
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This is Rahul on for Jeremy. Starting off with the guidance reaffirmation, I mean, I've seen that the guidance hasn't changed for 2018 and also for the longer term here. I mean, is this like expect -- is the asset swap expected to be a largely EBITDA or DCF-neutral transaction? Just curious on like what would move the estimates between the low to high end of the range here?
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [3]
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So if you look at 2018, this transaction basically will have de minimis impact at all. If you look at the kind of stacked bar charts that we talked to and the additional potential upside that we're looking at here, part of the process over the next few months is really working with our sponsors, CNX, to determine any changes in different development plans that might occur. So at this moment, we have reaffirmed, but there's definitely potential for upside, as we look towards optimizing the new locations.
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Rahul Krotthapalli, JP Morgan Chase & Co, Research Division - Analyst [4]
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Got you. That's helpful. And then, just coming back to comments made in the PR about how the new amendment to the GGAs could create additional flexibility [or] control for CNXM in driving the DevCo I growth strategies. Can you provide some more color on what or how that could shape up going forward? And then, I'd also some -- some more commentary on the improved (inaudible) on shipper terms following the amendment.
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [5]
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Yes. So as we talked to whenever we had the GP acquisition back on January 3, there were certain changes and revisions made to the CNX kind of gas gathering agreement, which was sort of publicly filed. So in general, summarizing it is -- it allows full ability to put third-party volumes onto the systems and it ensures that the gas -- the new gas volumes is going to utilize existing infrastructure and systems that the MLP already has in place. So it just really enhances the assurances that the MLP can operate kind of independently standalone, while servicing its 2 largest customers, CNX and HG.
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Rahul Krotthapalli, JP Morgan Chase & Co, Research Division - Analyst [6]
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Got you. And then again, like the growth CapEx like on a net basis, like would there be any kind of deviations outside the range from the guided numbers, given the equity is now more focused on DevCo I, where you're 100% there on CNXM? Just want to confirm that.
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [7]
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Yes. So whenever we talk to our -- and put our guidance together at the Analyst Day, we assumed no incremental HG activity. So there wasn't any capital spend associated with anything in those areas on the CNX side and the development potentials there. Those are the pieces that we're still working together. But like I said that, the DevCo I locations, which are the 100% net to the MLP areas, really utilize existing infrastructure. So any capital required to connect locations there are just well connects, very small capital spends.
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Operator [8]
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The next question comes from Ethan Bellamy of Baird.
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Ethan Heyward Bellamy, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [9]
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Couple questions on drop-downs. What's going to drive the future timing and sequencing? And is CNX amenable to taking equity if the public markets remain poor?
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Timothy C. Dugan, CNX Midstream Partners LP - COO & Director [10]
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I think, the timing is going to be dictated really by what would be looked as the most accretive path for the CNX Midstream unitholders when you look at these candidates of drops. The only other factor I would put in there for some of those dropped candidates, timing of how the asset itself that it represents develops out; water is a good example of that one. But the others, in the case of something like Cardinal States or some of these other candidates, they're already up and running, of course, and generating cash flows. So we've got the ability here just because of the scope of the drop roster and the nature of those assets individually from going into development, partially developed and then fully developed, to pick and choose our spots. Our plans, when you go back and look at what projections are and assumptions are from the sponsor side, do not assume any drops moving forward. So it's not something that's front and center with respect to what the sponsor is trying to achieve. That puts CNX Midstream in a position to really work with the sponsor and pick and choose the timing. As to consideration and what that looks like, we're completely open from both the midstream perspective as well as the upstream sponsor to do whatever makes the most sense when you're looking at NAV per unit from a midstream perspective. So it's a lot of flexibility there. We've got a wide roster of dropped candidates moving forward. And we've got the ability to pick and choose our points to make the best decisions optimally over the long haul.
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Ethan Heyward Bellamy, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [11]
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And a lot of liquidity. That's a good answer. So if we look at Page 10 in the deck, I know you don't want to give specific numbers on what some of these might mean, but can you give us an aggregate rough drop-down value that we should be considering?
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Donald Rush, [12]
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Yes, I don't have that old Analyst Day deck in front of me, but we showcased $200 million of potential drop [into] EBITDA in the next couple years. So it would kind of build to that sort of consistent and like to the earlier question, there wasn't really HG-type asset EBITDA in that $200 million. So that $200 million still exists.
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [13]
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Yes. And Ethan, that's $200 million of EBITDA -- 2020 EBITDA, which was highlighted at the Analyst and Investor Meeting in March. It's in the CNX [retooling] deck.
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Ethan Heyward Bellamy, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [14]
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Okay. And then, bigger picture question on just sort of overall business environment and risk. I mean, there's a reasonable fair case on Northeastern gas, given the magnitude of overall U.S. gas production and limited takeaway capacity potentially out of the basin and continued potential realization issues longer term. Is there a gas price number that is sort of a worry number we should keep in mind, where you'd expect CNXM and HG to curtail development plans?
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [15]
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Just -- I'll give you a couple of maybe big picture views and Don can weigh in on some specifics. With respect to the HG side, the projections that we assume for CNX Midstream, beyond the well commitments, are no activity. So for that type estimates, [it would be]. The CNX-sponsored side of things, this is all about -- really, we think -- especially with MLPs, you create as much value by mitigating risk as you do as well as driving or creating upside. And we've been looking and spending a lot of time through these recent actions to derisk that 15% distribution growth story over what was 5 to now 6 years. And that's through the MWCs and the MWCs. So those types of commitments were put in place for the very type of situation that you're describing, where we can assure from a midstream side that the capital that we're going to deploy to hit that 15% distribution plan over the next 6 years is covered and protected by MWCs and MVCs. And the last thing I'll throw in there from the sponsor side, the sponsor, of course, recognizes that and it's another example of why things like the programmatic hedging, including basis hedging, that the sponsor engages in along with the balance sheet that it's built on the sponsor side have been working in concert together to make sure that it's cash flows are protected -- it's rate of returns on its capital deployments are protected in a way where the activity set continues on in an efficient manner.
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Donald Rush, [16]
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Yes. And just to sort of to add to that, we stated for a while that new takeaway capacity coming in, which we think there's realistically 10 to 12 BCF per day kind of to that increases is going to be in play throughout '19. So that will provide some kind of headroom running space with this. Second, a lot of the forward strips in basin pricing is already kind of in the low 2s and we've used that in our Analyst Day materials and our decision making here. So it's not a very current good gas price in the outer years currently anyways, and that works for us very well for a reference point to execute our plans and get our returns. And third, the biggest protection outside of ensuring that you keep a strong hedge book and liquidity position is to have a low cost and be in the best location in the basin. If you look at our Southwest PA, both from CNX' perspective or CNX Midstream's perspective, it is the best place you want to be in Appalachian basin. So that kind of couples together to have us a pretty good foundation of strength going forward.
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Ethan Heyward Bellamy, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [17]
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Okay. Just a follow-up here. So did -- on the MVCs, did you start with the 15% growth and work backward to cover that on the volumes?
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Donald Rush, [18]
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So this kind of get built in a couple different tranches. We did triangulate whenever we did the first GP acquisition with the new enhanced GGA for our dry system. It was a fairly extensive capital buildout. Those MVCs, 140 wells, kind of built underneath that. The Shirley Penns drop was a volume commitment and that was built off of just the right blend on its growth profile to get that dropped -- done this year to get the balance sheet in place that we wanted to fund the organic growth that we needed for the GGA and the big DevCo I dry gas expansion. This last round of commitments was sort of part solving and ensuring that we had a clean, clear runway going forward. The CapEx spends for this are very de minimis. So the importance was really driven off of ensuring that we're able to really lock down and derisk our 5-year, 15% distribution growth plan.
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Ethan Heyward Bellamy, Robert W. Baird & Co. Incorporated, Research Division - Senior Research Analyst [19]
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Okay. That's helpful. And then, last question, with respect to volumes, EBITDA or DCF, can you give us a CNX versus HG mix for either '18, '19 or '20?
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Donald Rush, [20]
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So we laid this out in the Analyst Day a bit. I want to say in '18, it'll be about 60-40, 60% CNX and about 40% HG. As CNX' volumes continue to grow in DevCo I, that'll obviously get diluted out over time every quarter as CNX wells get turned in line.
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Operator [21]
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(Operator Instructions) The next question comes from Tim Howard of Stifel.
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Timothy D. Howard, Stifel, Nicolaus & Company, Incorporated, Research Division - Associate [22]
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Shifting back to the HG transaction, could you just provide some background of how it came to fruition? Did they come to you guys? Did CNX go to them? When you originally acquired the GP -- the 100% of the GP, did you kind of think this transaction was possible? And then finally, just interested in how you ascribed value to the 235,000 dedicated acres. There is a number of moving parts and I just kind of want to understand as you look into the next decade -- later in the next decade, why this is the right value for that acreage dedication?
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Nicholas J. DeIuliis, CNX Midstream Partners LP - Chairman of the Board & CEO [23]
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The genesis of this deal that we announced yesterday really started months ago when HG and Quantum basically acquired (inaudible) our prior JV partner Noble's upstream interest. And it's taken a number of twists and turns over those months. But in the end, it really started and concluded with the same large drivers, which is: a, they're a very important customer of CNX Midstream. So when they have issues and opportunities and thoughts, we're going to jump to those immediately, just because that's what good midstream providers will do and understanding where they're -- your customers are coming from is critical. But b, their philosophies and their focus on how they think about their asset base in their companies in the Appalachian basin is very similar that, that's employed at CNX Midstream, which goes back to efficient capital allocation, making sure that we're good capital allocators and looking at things over a horizon and seeing how that compares to what you're trying to achieve with long-term objectives. So the more and more we got to develop that relationship, it basically bloomed into a partnership. And looking at what each party and entity was trying to achieve, we looked at a situation where, from a CNX Midstream perspective, a -- clearly our path forward, our unit accretion route is going to be steeped when it comes to these very high rate of returns areas in the Marcellus and then stack pay coming on top of it, sort of the DevCo I anchor system area. And anything that we can do that would increase our focus in doubling down our attention and concentration in that area was going to bode very well for unitholders. And it just so happened, we were able to strike this arrangement where, not only we were able to do that, but with all the other positive aspects of that we listed through, we were able to basically develop that stacked bar chart of distributable cash flow growth now over 5-plus years, it looks very attractive. And basically, on the acres that were undedicated, when you compare those to what the opportunity set is with the rate of return filter on our core anchor system opportunities, there's a significant gap between those 2. So it's not to say that they're uneconomic, it's not to say that there won't be success there, but when you just list and dispatch where the best bang for the buck is with CNX Midstream, it's clearly in the anchor DevCo I areas with Marcellus and stack pays coming down the pike and these roster drop candidate that we talked about.
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Operator [24]
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This concludes our question-and-answer session. I would now like to turn the conference back over to Mr. Lewis for closing remarks.
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Tyler Lewis, [25]
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Great, thank you. Thanks everyone for joining us. We look forward to speaking with you next quarter. Thank you.
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Operator [26]
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The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.