Williams Partners LP WPZ
Q4 2013 Earnings Call Transcript
Transcript Call Date 02/20/2014

Operator: Please stand by, we're about to begin. Good day everyone, and welcome to The Williams and Williams Partners Fourth Quarter Earnings Conference Call. Today's conference is being recorded.

At this time for opening remarks and introductions, I would like to turn the call over to Mr. John Porter, Head of Investor Relations. Please go ahead.

John Porter - IR: Thank you, Dana. Good morning and welcome. As always, we thank you for your interest in Williams and Williams Partners. Yesterday afternoon, we released our financial results and posted several important items on our websites, williams.com and williamslp.com. These items include yesterday's press releases with related schedules and the accompanying analyst packages, the slide deck that our President and CEO, Alan Armstrong, will speak to momentarily, and an update to our data books, which contain detailed information regarding various aspects of our business.

In addition to Alan, we also have the four leaders of our operating areas with us; Jim Scheel leads our Northeastern G&P operating area; Allison Bridges leads our Western area; Rory Miller leads the Atlantic Gulf area; and John Dearborn is here from our NGL and Petchem Services operating area. Additionally, our CFO, Don Chappel is available to respond to any questions.

In yesterday's presentation and also in our data books you will find an important disclaimer related to forward-looking statements. This disclaimer is important and integral to all of our remarks and you should review it. Also included in our presentation materials are various non-GAAP measures that we've reconciled to generally accepted accounting principles. Those reconciliation schedules appear at the back of the presentation materials.

So with that, I'll turn it over to Alan Armstrong.

Alan S. Armstrong - President and CEO: Great. Thank you, John, and good morning. Let me welcome all of you who're joining us today for our fourth quarter results. We'll also talk about our major developments and our outlook today. We do have a lot to cover today concerning items like Geismar, Gulfstar, Bluegrass, our Northeast volume growth, and now our big exciting project, Atlantic Sunrise. But before I turn to our fourth quarter results and our full year, let me provide a brief update on where we are with Corvex and Sorban. As you know, in December Corvex and Sorban disclosed their interest in each having representation on the Williams Board. Since that time, we've been engaged in discussions with both Corvex and Sorban, related to the Company's strategic plan to drive continued value creation and, of course, we look forward to continuing those discussions with those parties.

We do have a long track record here at Williams and in fact, in recent years have been a leader in taking advantage of transformational and structural opportunities to create value for our shareholders and we continue to welcome input towards our goal of enhancing shareholder value for this great Company. So, with that, let's turn to our fourth quarter results.

Before we get into the details of the fourth quarter performance for WPZ, I'd like to remind you of our strategic focus to grow our exposure to fee-based revenues. We are accomplishing this by continuing to develop large scale infrastructure that will be critical to connecting the fastest growing supply to the fastest growing markets for natural gas and natural gas derivatives.

In fact, this train is just gaining steam as we saw an 8% increase year-over-year in fee-based revenues at WPZ and we expect even faster growth into 2014 and '15. In the fourth quarter, WPZ enjoyed this growth trend despite harsh winter weather conditions in the Rockies and in fact we had another record for DCF growth in the fourth quarter of $509 million, up 26% over the previous fourth quarter. This strong performance exceeded our internal expectations in spite of about $43 million lower in NGL margins. One of the drivers for the better performance was lower cost and maintenance capital expenses.

About a year ago we reorganized the company to enable a flatter management structure and better cost efficiencies by deploying our very best knowledge of things like asset integrity and determine across our entire operations. As you can see by analyzing our numbers we've been able to drive the combination of our O&M and G&A expenses lower despite managing tremendous growth in our business.

I want to be very clear that our lower maintenance cost in our maintenance CapEx area has been driven by better efficiencies and fewer required repairs, not lower standards of care across our facilities.

WMB also – moving on to WMB, we also enjoyed an 8% increase year-over-year in segment profit plus DD&A for the quarter with Williams Partners caring much of that increase, one disappointment for the fourth quarter was financial performance for our WMB NGL and Petchem Services segments primarily driven by Canada where third-party outages dramatically impacted supplies available for our Fort McMurray facility. But that project is up and running very well now and is now exceeding our expectations for both recoveries and volumes as we really have that business up and running very smoothly now with the ethane recovery portion that we added to that business in the third and fourth quarter of last year.

So we look forward to that project becoming the driver for WPZs results with the drop down and we expect that to be completed very soon here actually at the end of this month.

So of course we appreciate the great work the team at ACMP is doing to grow their business in a steady and predictable manner and of course it has helped us outperform the year for the fourth quarter.

Moving on to the DCF growth and our expectations for growth looking into '14 and '15, we do continue to expect strong DCF growth, in fact, greater than 50% from 2013 to 2015. This extraordinary growth rate is on the back of large capital investments that we've been making over the last couple of years, most of which – a lot of which has been financed by equity, and our organization is very focused right now on executing this large capital program that is essential to this growth.

We updated our commodity prices and our latest assumptions on all of our key projects for 2014. With the degree of volatility we've seen recently in commodity prices, there are a lot different impacts on our guidance. But in summary, our guidance range is unchanged from the third quarter.

We have great visibility around the projects that we expect will drive this growth. We continue to hit key execution milestones that serve to substantially derisk these major projects, and I'll talk a little bit about that in some more detail on a few of our projects.

Where we did update our guidance is for growth CapEx, where we have added some noteworthy changes, and we'll see that here on the next slide. So, you can see for the WPZ increase in CapEx, we've got initial spending on some new projects; so projects like Atlantic Sunrise and Dalton. And this higher spending reaffirms our belief and growth potential to our business, both within and well beyond our guidance period.

Two of the new projects we've listed here; Atlantic Sunrise and Dalton are on our Transco system, where we continue to see strong demand for our services. And really, I think, in a very positive way here, not just coming from the supply side but from the market and the demand side as well.

I expect you saw our news release this morning with some additional detail on Atlantic Sunrise, and we'll hit that topic here in a few minutes. Gunflint, which is mentioned here is a deepwater tieback to our new Gulfstar One facility and our team on Gulfstar have done a terrific job of making some modifications onto the top sides there at Gulfstar to be able to accommodate the easy tieback of Gunflint. So, real excited about the way our team continues to execute on Gulfstar One; and WPZ will be adding CapEx for the new Redwater project. So, these are expansions at Redwater that will accommodate themes like the CNRL Horizon volumes that will be coming in and so with added capital in there for that as well. We're also incorporating $175 million higher capital spend for the Geismar expansion on higher costs that resolve in part from the delay in the restart.

For WMB specifically, you'll see that we have lowered our growth CapEx to reflect a shift in timing to mid-to-late 2016 on the joint venture Bluegrass Pipeline project to better match the need of the market. We remain very excited about the Bluegrass Pipeline project and I continue to believe that it's the best solution available in the market and what I can tell you in terms of where we are is that the activity that we continue to see and the input and discussions that we're having, there are a number of parties out there who share our view of the market and the attractiveness of the solution and we are working to reach definitive agreements with all interested parties as we push that project forward.

Moving on to next slide here on Atlantic Sunrise, just a little bit of update, and just some brief information, we did issue a news release earlier today on the milestone that Transco executed firm contracts with nine shippers or 100% of the 1.7 million dekatherms per day of firm transportation capacity and so we are very excited to announce that very important project for Transco and that it not only serves as a great investment, but it really opens up a lot of supply availability for expanding markets as well.

The project includes 15 year shipper commitments and the shippers are both producers local distribution companies and power generators. The project represents vital energy infrastructure designed to connect surging new supplies of natural gas in the Marcellus producing region and really come in mostly from the Northeastern Pennsylvania area with growing demand centers along the Atlantic seaboard.

We expect to bring the Atlantic Sunrise into service in the second half of 2017 and of course this assumes all necessary regulatory approvals are received in a timely manner.

Moving on to our milestones and key accomplishments and developments here. On Slide 9 we did have a number of recent milestones in fourth quarter and even into this year.

We brought the Canadian ethane recovery project online as I mentioned earlier. The volumes in the fourth quarter for that were disappointing for a number of reasons, but primarily impacted by some third-party outages both upstream and some difficulties delivering the product downstream those have all been worked out now and we're enjoying as I mentioned earlier, great volume growth now.

We are reaching important milestones on our Keathley Canyon and Gulfstar projects. We also are rapidly growing our Northeast business. We saw 63% increase in our gathering volumes from the fourth quarter of '13, fourth quarter of '12 and that compares very favorably if you really look at the whole Marcellus volumes which grew about 40% last year. So, really, we're growing – that says we're growing at a 50% higher rate than the broader Marcellus base is growing, so we're very excited about that.

We did see our volumes reach an average of about 1.9 Bcf per day for the full year and, of course, our actual volumes are well above that now.

We touched on the impressive financial growth that we expect to see between '13 and '14. I would certainly say that's not without risk, and we've highlighted the largest of the growth drivers here for 2014 as we continue to push forward on these projects.

Looking at 2015 and beyond, we're really starting to see the development of our growth as some of our projects experience a full year of earnings and we bring these new projects online. So, '15 is both the combination of a lot of the full year benefit of projects like Gulfstar and Keathley Canyon, which come on in the last half of the year going into '15 as well as some exciting new growth projects for '15 as well.

Beyond the guidance period, we really began to see the effect of these major projects. They provide visibility to our continued WPZ DCF growth and support for Williams' continued strong dividend growth. Because we do have the luxury of so many projects that leverage off of our competitive advantages, we can be selective in pursuing only the best risk-adjusted return projects. So, we're in a very envious position to be allocating capital to really the very best projects.

Moving on to Slide 10 here, the picture of the different services we're providing for the Northeast. And here's our large-scale strategy really comes together and plays out in this key growth area where we have operations, investments and opportunities across our various lines of our business.

We're strategically positioned in one of the fastest growing production areas. The biggest challenges in the Marcellus and the Utica are exactly the kinds of problems that our large scale infrastructure strategy is designed to solve. This is a great resource basin that needs great market access and what stands in our way, well, you know as we've been pushing through these major projects, certainly one of the key issues is the customer's ability to make major commitments up against very complex regulatory structures and the risks in their business and certainly, the regulatory complexity that it's taking to get this large-scale infrastructure installed as well are barriers to growth. That's both an impediment, but it's also a great opportunity for a company like Williams that's very skilled at taking on these very large, complex projects.

Atlantic Sunrise and Bluegrass are really big infrastructure solutions that we've been working on. In the case of Atlantic Sunrise, it took some chronic, very visible infrastructure constraints in the market to bring adequate shipper support and firm-transportation contracts with long 15-year terms to the project. Consider that in this example with Atlantic Sunrise, it takes more than $400 million in annual revenue, each and every year over those 15 years along with very strong credit support behind those to underwrite a project of this size. That's a very big commitment to make in the face of these regulatory mazes, but as was mentioned earlier, the market has really recognized that it's going to have to investment and support these kind of projects and so Atlantic Sunrise is one of the first major investments that's coming, that connects increasing markets with these increasing supplies in the Marcellus area.

Of course, it's on the backs of three smaller projects that we've been doing out of the area, but this is really a very large scale project that we are bringing forward. We certainly believe that the Bluegrass Pipeline project will be the next chapter in how this story plays out. But in the NGL segment of the market as the constraint and the supply sources become more evident and people work harder for really the right out of the basin and our discussions with our customers certainly indicate that's where we are headed.

We expect to bring the Geismar plant back into service. I'm moving to Slide 11 here. We expect the Geismar plant to back in service in June this year. The delay in returning the plant to service and completing the expansion resulted from a variety of factors including, the extended loss of utilities so that’s primarily things like steam, our electrical system. Those were all damaged severely in the incident and as a result, getting the project back up and running without those systems has proved to be very difficult and very complex.

Based on the current commodity price assumptions we continue to expect that we're mostly covered on the financial effect of the incident, with the exception of the 60-day period before the business interruption insurance kicked in during 2013 and the $13 million in cash deductibles that were primarily associated with property damage.

Moving on to Slide 12 here talking about some exciting milestones here in our deepwater projects and of course that’s included in our Atlantic Gulf segment.

On Gulfstar One we've now achieved an important milestone with the mooring process. So Gulfstar has now reached storm safe status, and the contingencies to cover risk related to weather and powerful eddy currents can be dramatically reduced. So one of the key issues is getting a spar like this set. When we set Devils Tower originally we were faced with some pretty bad Eddy currents in this area, and getting that facility more is a major milestone for our team, and things have been going very smoothly and accelerating the schedule on Gulfstar. So, very excited about the team's performance out there on Gulfstar.

So, we do expect our facilities to be in place for an on-time start-up of production. Keep in mind that a portion of our cash flows will be dependent on the start-up of the production and, of course, we will be doing everything we can to help the producer bring production on as soon as possible.

I'll remind you that on Gulfstar that Hess and Chevron's Tubular Bells prospect initially, and then as I mentioned earlier, later outside of the guidance period, (indiscernible) would be tied back. We do expect production to commence in the third quarter of this year.

On the Keathley Canyon project, the customers are Anadarko and Exxon, and we expect this work to be done well ahead of the production commencing in the fourth quarter of this year. And in fact, our deepwater line is now more than 80% laid.

Moving to the summary Slide here on 13, we'd just tell you, we're very committed to the strategy with an intense focus for the long-term on the natural gas supercycle. We are convinced more than ever that we're really in the sweet spot. We've positioned ourselves very well to create value in this environment. We are now getting some tailwinds from a lift in both NGL prices and gas prices, and these are exactly the kind of signals that the producing community needs to see right now to continue to develop the resources that are out in front of us.

We're rapidly converting our business to a volume fee-based business that is enduring and we're putting in the kind of infrastructure that is difficult to replicate in the long-term. We are very focused on this critical infrastructure and very well contracted business that's going to be here for the long-haul due to its competitive advantages in the market. That's hard work. It's a lot of risk and it's a lot of grip on the part of our team to push through all of that, but that's exactly what we're going to stay focused on and it's the stuff that, in the long-term the market is going to have to for a sustainable growth in natural gas and natural gas derivatives markets here in the U.S. I truly believe that there is no other company in this sector that enjoys the degree of visibility to growth that we enjoy, both now and over the long period.

So, with that, I thank you very much for joining us and we'll turn it over to questions.

Transcript Call Date 02/20/2014

Operator: Brad Olsen, Tudor Pickering.

Brad Olsen - Tudor Pickering: First, a quick question about weather. Obviously, the price impact of this winter has been very good for gas and NGL markets. What impact, if any do you expect to see as we move into Q1 in terms of freeze offs or other operational issues as a result of weather either in the West or in the Northeast and have we seen some of the build out in the Northeast or some of the drilling activity slow as a result of some of the cold weather?

Alan S. Armstrong - President and CEO: First of all, I'd like to commend our Western team and our Northeast team for some great operations despite some difficult environments out West in the fourth quarter. Moving into the first quarter where your question was targeted. I would say that west continues to do pretty well up against, we normally do have quite a bit of freeze off. But to tell they continue to perform very well up against the norms for the Rockies in the western area, San Juan basin has actually had one of the better periods during this than we normally see. We normally see quite a bit of reduction in production there. In the Northeast I'm very thankful for the work our teams done out there is reliability up on our system I will tell you there has certainly been some freeze offs upstream on some of the producers equipment and some of the volumes upstream of our facilities. But our facilities have remained very reliable and really excited to see our team having push through some very challenging times of getting these facilities up to reliable standards. So we've had some freeze offs out there in the wet Marcellus area, but again it's not been on our systems, it's been upstream and producers have been working very quickly to overcome that.

Brad Olsen - Tudor Pickering: Another question about a little bit more of the long term outlook in the Northeast on your OVM system specifically. There have been some really impressive dry gas well results just across the river in Ohio and it appears that there is some potential prospectivity in Marshall and Wetzel for those very productive dry gas horizons. Is that kind of emerging play something that you've discussed with your OVM customers? Would that dry gas production, if it does emerge, would that dryer gas maybe alleviate some of the operational issues that you've seen with some of the – especially super-rich gas that you've had on the OVM system just by diluting some of the liquid content and providing you with maybe more of a dry gas blend stock for some of the ethane-rich gas you produce?

Alan S. Armstrong - President and CEO: Yes. Well, first of all, we'll tell you, there are several of our key producers that do have plans this year to test and to – both the Utica, dry and the Upper Devonian; and while the Upper Devonian doesn't provide any relief, I hate – as a processing company, I hate to think about getting – moving to dry gas as a relief. But to your point, some of the big volumes that we've been seeing from Utica test in the dry area, which certainly help provide some sweeping volumes and a more reasonable gas-to-liquids phase in our pipeline. So, we're excited about that and we certainly are working with producers. I will tell you, included in our capital is some expansions of our systems to bail – to accommodate some of those higher volumes on the dry gas side.

Brad Olsen - Tudor Pickering: Just one last one on Constitution and Atlantic Sunrise. Constitution kind of stood out as the only Northeast pipe project involve a significant laying of newbuild pipe, and the Atlantic Sunrise, at least from the map you've provided, it appears as though that project would also involve some significant new pipe from kind of the Leidy Line down towards Station 190. And I guess is there anything from the Constitution process that's maybe something that could be applied to the Atlantic Sunrise process, or is something where as long as you're laying significant newbuild pipe, there will be some regulatory risk of delays and what have you?

Alan S. Armstrong - President and CEO: I will tell you that on Constitution, the real issue we're facing right now, from a regulatory issue, really relates to the New York DEC, not to the FERC and so, the nice thing about Sunrise is it does not go through the New York area, so we're not faced with that same regulatory issue. On the FERC side, I would just tell you, they're continuing to push through, you saw the Constitution Draft EIS, so we're very thankful for the FERC continuing to try to do their part to accelerate these projects and we continue to work well with them and we certainly have some – a lot of discussions, communications we need to do in New York to find the right answers and right solutions there as well.

Operator: Stephen Maresca, Morgan Stanley.

Stephen Maresca - Morgan Stanley: A couple of quick questions on Geismar. So, you say, you expect to be out of service until June, how firm is that date and then how much extra out of pocket costs are there for each month you miss that? It seems like you only had, if I'm reading this right, 10 million of additional uninsured losses from delaying this two to three months from April to June? Is that right?

Alan S. Armstrong - President and CEO: Yeah, it's for two months. That's correct. Just a little over two months of delay. That's correct. So, to answer your question, right now the mechanical completion is expected in the first part of May and I would tell you there's obviously a lot of things to go right, but I am very proud of the work that our team has done and really dig in some great detail to understand what the drivers of that are in the productivity labor and I think we've got a very studied perspective on that issue. Having said that I would tell you that window is probably from the last week in May through the end of June as the expected window right now for that startup, in terms of that cost of course if we were delayed beyond that, it's very dependent on ethane to ethylene spreads and but you know in a range that’s probably around $1.5 million to maybe up to $2 million a day of expected revenues we'd lose from it.

Stephen Maresca - Morgan Stanley: Then one more, the $175 million of more CapEx on hard cost for Geismar, is that just relating to repairs or are you getting a return on that increased capital spend?

Alan S. Armstrong - President and CEO: No, unfortunately this isn’t one that get any return on. I would just tell you it's been driven by a lot of the complexities associated with the damage to the plant so we've had as I mentioned earlier. We've had to go in and wait on utilities being ready the complexity of working in both the damage repair area as well as the getting expansion, just put a very crowded and complex stage there. So I would tell you that, that is one of the major drivers for, but there certainly isn’t unfortunately any incremental return from that investment.

Stephen Maresca - Morgan Stanley: Then moving to Bluegrass Alan you pushed it out, but you are still talking quite favorably on the project and is your sense of producers eventually going to be willing to sign up but this is just the timing issue and I guess what is causing them to hold off on signing right now and still giving you confidence that they will in the future?

Alan S. Armstrong - President and CEO: Yeah, Steve, great question. I'll just tell you, if you look at what it cost for a producer, the kind of commitment that somebody has got 30,000 to 70,000 barrels a day of commitment and you look at what that looks like on a roughly $0.30 a gallon by the time you pay for transport, frac and go through an export facility, that $0.30 of gallon, you put that times 30,000 to 50,000 barrels a day and pilot up for 15 years, that's a very, very large commitment for many of the producers we're dealing with. It's just taken time for them to get all their approvals and work through all of the issues and concerns that they have with that, because that is a very, very large commitment if you do the math on that. So, I really think that's the practical issue we're dealing with. We have some very engaged customers. I think, as I mentioned, a lot of our customers see this opportunity just like we do, that it is essential and its essential piece of infrastructure. I think some folks would just like to see somebody else get it build and hopefully be on the coattails of that. But frankly, we're going to have to see an adequate amount of financial support before we push through with additional investment.

Stephen Maresca - Morgan Stanley: I appreciate moving away from Bluegrass in your comment about discussions with Sorban, Corvex. Wondering if you could just talk about any discussions you've had with respect to the Access 50% GP interest held by GIP. Is it something that you would ultimately like to own at WMB and is it something you're working towards ultimately?

Alan S. Armstrong - President and CEO: Well, I would just tell you, we think the ACMP business is a great business. We think it'd be great complement to Williams in a lot of ways, both from a management team standpoint as well as the business structure and the contracts and the focus on natural gas. So, it's very much in line with our strategy, but of course – I think fundamentally the answer to your question is, yes, we would like to look towards bringing in the synergies of combining those businesses, but there's another party involved and that means there's a value trade to be had and we'd have to make sure that that value trade really makes sense for our shareholders and because we do have so many great investment opportunities in front of us right now. We have to keep that in balance as well. So, to answer your question, yes, we'd love to do it, but at the right price and at the right timing as well, because the bigger hurry we get in, the more expenses that likely becomes.

Stephen Maresca - Morgan Stanley: One quick follow-up, I mean, are there active – would you describe as active discussions in that for this or not right now?

Alan S. Armstrong - President and CEO: No, I would describe there as being any active discussions, I would say. We continue to study the opportunity from our own perspective, but I wouldn't suggest that there's any active discussions with GIP on that.

Stephen Maresca - Morgan Stanley: Final very quick one from me. Do you expect to have IDR waivers in 2014? I saw that you didn't have them in the fourth quarter.

Alan S. Armstrong - President and CEO: No, we do not intend to have IDR waivers.

Operator: Abhi Rajendran, Credit Suisse.

Abhi Rajendran - Credit Suisse: A couple of quick questions, you increased a lot of your assumptions on your commodity deck, but your outlook was largely unchanged. I guess, is this just a function of most of the commodity movements largely netting themselves out or are there some volume offsets if you could provide some color on some of the puts and takes that would be helpful.

Alan S. Armstrong - President and CEO: Sure. Yeah, really it is very much an offset, so you'll see of course, some higher NGL prices just to reflect the current market and you'll see the slightly lower ethylene prices and of course all that is up against a higher natural gas price, and so as I mentioned in my comments, really, all of those worked to offset each other primarily. So really, fairly little movement in the overall business on…

Abhi Rajendran - Credit Suisse: And on the topic of ethylene, ethane prices, I mean, could you talk a little bit about your thoughts on margins for Geismar over the long run, obviously after it's up and running. Ethane has spiked recently, but there's still plenty of supply coming online and on the pricing side. Ethylene is largely driven by crude, international crude. So, just some of the puts and takes there and your thoughts on how margins will shape up over time.

Alan S. Armstrong - President and CEO: I'm going to ask John Dearborn to take that question for us.

John R. Dearborn - SVP, NGL and Petchem Services: Starting with the – let's start with the short term look at ethylene. As we look back over our shoulder coming out of last year in anticipation of the second quarter turnarounds that are in front of, I think there are three crackers that are about to turnaround in the second quarter. The industry if you look at the AFPM inventory data, built inventory and our estimate is they build somewhere 700 million and 800 million pounds through the end of the year. That’s roughly how much ethylene will be needed in the second quarter. I think on the back of that we saw the weakening prices in the first quarter. It's our expectation they'll warm up again into the second quarter and thus and back to what we would consider normal for the year in the later part of the year. So I think that's the way we see this year playing out if we look at ethane. I think in the short term ethane is facing some operational difficulties in the Gulf Coast mainly related to brine. As all the new fractionators who built there in the Gulf Coast I think folks just challenged in moving the inventories around as necessary because of some brine difficulties. We think that’s going to clear out over the short period of time and as a result coupled with, as a result I think we are going to see the ethane prices drop back to what would be a more normal level in the $0.30 per gallon range, I think is what we've got in our guidance. So I think that takes care of this year's view. So now, as we look forward, the next significant tranches of ethylene are coming in 2017-2018 timeframe. So our expectation is on the back of oil staying high and naphtha being relatively related to oil that our ethylene margins through that period and still we see new significant supplies of ethylene come on in the latter part of this decade. I think our ethylene margins are expected to remain pretty strong.

Abhi Rajendran - Credit Suisse: Then one last quick one if I may. Could you maybe talk a little bit about recontracting on the Northwest and Transco pipelines in terms of what's out for renewal, how we should think about changes in transportation rates? Obviously, Transco is running pretty close to full. Northwest is not quite there, but any color there would be very helpful.

Alan S. Armstrong - President and CEO: I'll ask – we're in very good shape on that as well as Gulfstream. I'll ask Rory Miller to take Transco and then Allison Bridges can give you a response on Northwest. So, Rory, if you'll take that Transco question?

Rory L. Miller - Senior Vice President, Atlantic – Gulf Operating Area: Yeah, that's a good question. Just thinking about Transco a little bit, we've got, what I would call, some pretty fresh market signals around pricing with our new Atlantic Sunrise project. And although we're not really disclosing on the information on it right now, the rates are above – significantly above where our system rate is. I think we've got an average of six years or so on contract length there. But we believe that with the change of the system, supply coming in both ends, and the kind of growth that we have from the market side, it's truly a supply-push, market-pull kind of scenario. We believe as those contracts were aloft that re-upping those contracts is going to be very attractive for our end users. We don't think anybody in the marketplace will be able to touch the opportunity that the LDCs have to just re-up those contracts and in fact that's what we've seen as contracts roll off, we've not seen any pressure at all in terms of getting those re-contracted. So, it's kind of a – it's a very healthy situation and I think, due in large part just to the quality of the service and the positioning of the asset.

Alan S. Armstrong - President and CEO: Thank you and Allison, if you'll take the North question on Northwest.

Allison G. Bridges - SVP, West: Yes, on Northwest we are fully subscribed, even though we don't run at 100% load factor day in and day out, we do – our contracts are fully subscribed and I believe, on average we have a remaining term of over nine years, and we've continued to be able to extend terms with customers. Additionally, we're really starting to see, I think, some exciting new market growth opportunities come to the Northwest through potential new fertilizer plants, potential new methanol plants for export. So, I think that not only will that continue to bode well for our existing capacity, I think, longer term, it will also result in some expansion opportunities.

Operator: Christina Chiow, Barclays.

Christina Chiow - Barclays Capital: In the Northeast, processing volumes look a bit stronger than I would have expected. How much if any of that was due to benefiting from a third party outage?

Alan S. Armstrong - President and CEO: There was some in the month – mostly in the month of December. There Christine it came from the natrium plant being down and I think it was around varied but up to about 50 million a day during the month of December.

Christina Chiow - Barclays Capital: Then if I look at your NGL production it looks like you guys may have hit your fractionation capacity maybe at the end of 4Q or sometime this quarter. Is that the case, and is your new fracing online today?

Alan S. Armstrong - President and CEO: Yes, we are up against the limits on the base frac and the second frac. We are – we'll be commissioning here towards the end of the first quarter.

Christina Chiow - Barclays Capital: So was there a buildup in NGL volumes that couldn’t get fraced or no?

Alan S. Armstrong - President and CEO: No.

Christina Chiow - Barclays Capital: Going to Bluegrass was there may be more acreage dedication than you would have liked and not enough minimum volume and or ship or pay commitments, is the delay in the pipeline more about reducing your volume risk and that’s only going to happen when producers feel more pain in net backs. Also have the smaller projects that have been announced since your original announcement of the project played a part in pushing back your timing?

Alan S. Armstrong - President and CEO: Well first of all on the acreage dedication, there is not enough volume we certainly appreciate both of those as contributions but clearly we want to have a baseload of revenues that we can count on initially and so that certainly is major part of the issue. Secondly as to the smaller projects, I think those are great projects I think they are needed, but they don’t provide the kind of long term underground storage opportunities that you get with the Gulf Coast, nor the diversity of the markets for both the growing Petchem business and as well as the export opportunities that are very large-scale in nature and in well-protected ports. So, I would just tell you that I think we're excited those other projects exist because we think the growth in volume certainly is dictating those kind of solutions, but we really haven't seen that as a big deterrent for producers committing to Bluegrass.

Christina Chiow - Barclays Capital: Then, last one for me, can you provide an update on the PDH facilities? Last, we heard you narrowed it down to two international players – or two players, I guess, who are interested in building derivative plant alongside your facilities. But, would like to know if there's been any progress there?

Alan S. Armstrong - President and CEO: Yeah, I'm going to ask John Dearborn to take that as well.

John R. Dearborn - SVP, NGL and Petchem Services: Yes, we made some good progress there. We actually narrowed it down to one person and we're entering into definitive agreements on that. Give us a couple of months, and probably by Analyst Day we'll be able to bring you a good update on where that project is at that stage, but progressing as expected at the moment.

Operator: Jeremy Tonet, JPMorgan.

Jeremy Tonet - JPMorgan: I was hoping just to possibly drill down a little bit more on the Northeast G&P. Would it be possibly to quantify how much weather impacted the quarter dollar-wise?

Alan S. Armstrong - President and CEO: I would tell you, it wasn't very large actually. I'd say, some of the more significant issues were line breaks and a number of one-time operational expenses and some write-downs and so forth, but not too big of a volume impact from weather. One impact though that we did suffer was the ethane limitations going into the TETCO system and so without the ethane systems being up and running yet, there were constraints that TETCO imposed on points like the Fort Beeler connection that required curtailments there and so that did have some impact on our volumes in the fourth quarter.

Jeremy Tonet - JPMorgan: Then, as we look forward into 2014, I was just wondering if you could provide any color on how you see this segment ramping up over the year. Do you expect the first quarter to be similar to fourth quarter or a steady ramp across the year or any step change in any given quarter?

Alan S. Armstrong - President and CEO: Well, some of the big projects that we have coming on of course is the Gulfstar project, which would come on in the third quarter and the Keathley Canyon project, which comes on at the beginning of fourth quarter and then the Rockaway Lateral project. Additionally, though the projects in the Northeast, many of which will come on, either at the very end of the first quarter or the second quarter, really are some big drivers, not necessarily just to volume but to the rate that we achieve for those services and so, even though people have become accustomed to looking at volume there, a lot of that will just be an increase in rate. So, those are really some of the big projects I would say on the Caiman system – sorry on the system in Susquehanna Supply Hub area with Cabot, those volumes continue to growth throughout the year and we're really excited about the continued growth up there and we're working very hard to keep the infrastructure out in front of that growth up there. But that’s pretty well steady, that growth to be pretty well steady throughout the year.

Jeremy Tonet - JPMorgan: So specific to the northeast GNP sounds like going into the second quarter that could be a bit of a step change there?

Alan S. Armstrong - President and CEO: Correct.

Operator: Harry Mateer, Barclays Capital.

Harry Mateer - Barclays Capital: Two for me, first can you just talk about whether your thoughts on the need to have investment-grade ratings that WMB have evolved and whether that financial policy might be part of your discussions when you consider taking advantage of structural and transformational opportunities that you mentioned at the start of the call.

Donald R. Chappel - SVP and CFO: Certainly our – I'll call it policy and desires have been to maintain investment-grade ratings at Williams. We think that it provides a lot of flexibility and ability to be opportunistic particularly during very challenging times when the high yield market is locked up. Having said that we are certainly open-minded to other paths that create more value, but it would have to be something compelling. That would cause us to deviate from the path that we're on. So again we continue to be open-minded, but we think it would take a compelling value creation situation in order for us to deviate from our current path.

Harry Mateer - Barclays Capital: Then just a follow-up on Transco and Northwest earlier I appreciate the commentary and rolling contracts. But you said there has been no issue in getting contracts renewed and extended. But I am just wondering has pricing been stable as well or do you feel like you are giving up some pricing to get tenure?

Rory L. Miller - Senior Vice President, Atlantic – Gulf Operating Area: Harry, we really haven’t seen price pressure on those re-upped contracts. If you look at where our system rates are, they're probably the lowest cost opportunity that people have in the marketplace. So, the other thing is so many of our – the LDCs that we serve, it's not like we're just dropping off large volumes of gas at one point. And some of our bigger customers, we've got over 40 delivery points. So, when you think about the way that we're distributing that gas into 60 or 70-year old distribution system and the low rates that we have that they can re-up at, it's just really hard – it's virtually impossible to replace those with gas from a new competitor.

Alan S. Armstrong - President and CEO: To be clear on that, we haven't discounted any of that firm. It's a 100% contracted and the rates are getting set by those rate cases, but to those long-haul 100% firms, there's not any discount. There may be discount in the production area for IT and so forth, but not on the long-haul firm.

Operator: Ted Durbin, Goldman Sachs.

Ted Durbin - Goldman Sachs: I guess first question for you at the WMB level. You've obviously reduced the CapEx here with Bluegrass getting pushed out, I'm wondering if you can just talk about capital allocation (felt on) the dividend; I don't know, with share buyback, keeping dry powder for acquisitions, what do you do with the extra cash now that you'll have here for a little while?

Alan S. Armstrong - President and CEO: Don, you take that.

Donald R. Chappel - SVP and CFO: Ted, this is Don. I would say that the extra cash flow now is still going into some of our growth projects like CNRL, and we'll see where Bluegrass goes. But for the near-term, that extra cash is being reinvested in that Canadian business. Longer-term, I think we have a lot of options and we'll have to see how things play out here in terms of investment as well as all the other options that we continue to evaluate. I think as Alan mentioned early on, we continue to evaluate kind of all the options and we're very open to possibilities that will create additional value.

Ted Durbin - Goldman Sachs: Then we've sort of talked around it a little bit but can you just give us a sense on Atlantic Sunrise, the returns we ought to be modeling in there, it sounds like it's higher than your current system rates, I think there's a mention of $400 million of revenue, just give a sense of what kind of returns on the $2.1 billion of capital we should expect?

Donald R. Chappel - SVP and CFO: That looks like about – without providing specific returns there, it does look like about a seven multiple on that project. Of course that's a little better than you normally would see on a pipeline project and some of that is driven by the fact that we did have the competitive advantage of having a lot of that service being provided by the existing system, and so that allows for some higher returns than normal.

Ted Durbin - Goldman Sachs: Then, last one for me is you sounded now, a little more bullish on the Gulf, any thoughts on potentially a second Gulfstar here as you're getting close to completion of the first one. What does the opportunity set look like right now?

Alan S. Armstrong - President and CEO: First of all, I'll tell you, one thing we are very excited about is the tiebacks that we're seeing to both Gulfstar One and to, the original Devils Tower Spar and I'll remind you those two facilities are fairly close together and so there's a pretty nice area there that we can serve from those two spars and we are seeing some nice tiebacks and certainly the Gunflint tieback is a big boost to our expected economics for Gulfstar and came on much earlier in our assumptions, in our projects like that we assume some tiebacks for the future but this one came on much earlier than we had expected originally for that project. So that’s very positive and of course we've got a couple of tiebacks to Devils Tower as well. On the new spar front, we have many projects that we're out there working as you look out into the further reaches I would tell you we are pretty excited about some of the opportunities that we see to serve PEMEX with some of their big deepwater finds which I'll remind you are just south of our Perdido Fold Belt and our pipeline go out serve Shell's projects at Perdido Norte. So anyway we are very excited seen a lot of interest in the product. But we don’t have any capital and guidance right now. We don’t have enough confidence in those projects at this point to have any capital embedded in our guidance right now.

Operator: Carl Kirst, BMO Capital Markets.

Carl Kirst - BMO Capital Markets: Just maybe a few cleanup questions if I could. Alan maybe going back to Bluegrass, if we get abandonment, FERC abandonment in March, do you see that playing any type of catalyst, did anyone have any concerns over that as they may have with other, alternative projects. Two could you help us with any color, maybe you saw from the international petchem community as far as going through Moss Lake and perhaps getting capacity on Bluegrass from that end?

Alan S. Armstrong - President and CEO: Well, those are both really astute questions first of all on the abandonment issue on Texas Gas, certainly Boardwalk's in control of that issue, and I would defer that question to them. It's certainly – at some point, the timing of that abandonment would certainly play into the decisions on Bluegrass and a catalyst for a decision, I would just say we're not certain of the timing on that. I think we certainly work closely with Boardwalk, but they've been working to manage that issue. But at some point that would likely become an issue as abandonment were to come out and a decision would have to be made in terms of which direction to take there. On the question around the international players, lots of interest; a lot of big interest, I would tell you, from a lot of international players. And I think there's some great strategic match-up there in terms of what we're trying to accomplish in the markets that we're trying to present for our producers in the Northeast. But I also would tell you, the challenge to that is, is a very slow process in terms of working through all the approvals, not within – not regulatory or anything like that, but within the governance within those very large multinational corporations. So, we're excited about it in strategy, but it's a long, arduous process to gain approval on that. And so, we're not waiting around. I would just put it that way, we're not waiting around for those approvals, we're moving on. But we do have a lot of exciting talks there and we remain very excited about that strategically, but we've got to execute in the near-term sometimes and those parties can move to.

Carl Kirst - BMO Capital Markets: Two last questions, if I could, in understanding with the Canadian PDH, we haven't seen the first one yet, so I don't want to necessarily put the cart in front of the horse but, to the extent that, my understanding was at the end of last year, we were looking at perhaps, in two different companies and that led into the potential even assessing a twin of the project, is that something that is still progressing or is it more at this point, let's get the first one locked up under construction and then we'll perhaps assess its winning at that point?

Alan S. Armstrong - President and CEO: I'm going to ask John Dearborn to take that.

John R. Dearborn - SVP, NGL and Petchem Services: The second PDH is certainly still a bright spot in our future that we want to keep our eye on, but I think you've got it exactly right that we need to have success with the first one, before we're ready to really take the big step into the second. The marketplace though is continuing to express great interest. In fact, the partner that we're talking with is interested in the second one as well. So, just that person is interested and then we've got an arm's length long list of folks that have come and approached us about number two. So, I guess, I'll just say stay tuned. It's more future growth opportunity for us up in the Canadian franchise.

Carl Kirst - BMO Capital Markets: Then final question if I could, maybe one for Don and understanding that this is sort of one of the risks that were outlined, insurance recoveries for Geismar and at the risk of perhaps oversimplification, is there any additional color to share that, say for instance of the $125 million second payment that should be coming this quarter, can you express that in any terms of did good versus ask of what you had requested from the insurance companies versus what they were comfortable at this point paying out.

Alan S. Armstrong - President and CEO: The insurers paid 100% of our claims to-date. So I think to-date they've paid the claim as filed. I think we are pretty well paid up through the end of the year now, in fact obviously the business interruption loss amounts every month. So we'll continue to update the claims process and make requests for additional payments and we'll see where that takes us. The actual claim is based on actual losses. So we can't expect to get paid for February until sometime after February ends or March until after March ends and we know what the real price is. We're in the market and therefore the basis of our claim. So those will kind of kick off periodically.

Operator: Craig Shere, Touhy Brothers.

Craig Shere - Touhy Brothers: Couple of questions here, Alan and Don on this call you've both commented a couple of times about being open-minded to transformational opportunities. But Don kind of emphasized bar was set high for giving up that investment-grade credit rating and also noted that WMB level free cash flow is already spoken for a bit in the near term. My first question is do you kind of see these ongoing internal discussions and discussions with investors being ongoing long term issue to keep in mind or something that’s more of a 2014 catalyst.

Alan S. Armstrong - President and CEO: Well I would just say it's great question, Craig, but we've always have got our eyes open to any arbitrage that’s available in the market and any additional value we can add to our shareholders through either transformation or structural changes, and as I mentioned earlier, I don't think anybody can accuse us of not having been aggressive, and in fact, we've certainly been a leader in many of the structural changes over the last several years. So, we'll continue to look for those, and I think the drivers will be what the market is valuing and how our businesses are being best valued in the market, and we'll continue to look for those opportunities as time goes by. So, I don't – unless there became a roadblock between a really good idea and what we're willing to do, that would be a catalyst that might limit to '14. I just don't see that. I think we're very well aligned with both Corvex and Sorban in terms of looking for the great value. I think their perspective is that we're well undervalued relative to marking to our peers, and that we've got the best growth story in the business and we ought to be getting valued better than our peers; not just at par with our peers. So, I think they see a huge value gap there, and I'll have to say, I share their perspective and then very well aligned and we'll continue to work with them or anybody else that has good ideas on how we could achieve that value.

Craig Shere - Touhy Brothers: I appreciate that. A couple more. With Gulfstar, one pending completion; do you see this completions successful, on-time completion being a catalyst for other significant deepwater projects?

Alan S. Armstrong - President and CEO: I would just tell, I think our producers – I think Hess and Chevron, and particularly Hess, just because there's more visibility to them, are going to wind up looking really smart on this project both in terms of the time that they brought their production to market and the capital that they have tied up or the lack of capital they have tied up. So, I think it's going to look like a really good project for them. It's going to look like a good project for us, because we're bringing in third party volumes and we're marketing the project for that. So, I think when people sit back and analyze that, they're going to look pretty smart and, I think Hess would want to do more business, Chevron would want to do more business like that and I think their peers will get pressured to do that kind of business as well. So, I think this is a smart solution out there and certainly it gives – will continue to gain confidence in our ability to execute on these kind of projects as well as the producing community.

Craig Shere - Touhy Brothers: Last two small ones. Can you provide some more color around that $20 million Petchem Services pipeline project write-off and as a follow-up to Abhi's question about long-term commodity price outlook, and I know this is going out a bit, but if we were thinking maybe nat gas and even ethane pricing, especially could be a headwind towards the end of the decade, would you consider leading up to that, balancing out your short positions by expanding Midstream Processing POP exposures through development or acquisition of new processing?

Alan S. Armstrong - President and CEO: First question on the write-off in the Petchem Services, that was related to an NGL extension up in the Northeast, a line extension that threw some potential partnering arrangements we don't think we need any longer and so, down to better solution and investment that we had made in a write away and so forth developing that project. So, that's the first one. Then secondly, on the commodity price outlook, certainly the natural gas pricing is one that is kind of bittersweet for us in the short-term it put pressure on our NGL margins and therefore ultimately on the ethylene spread as well. As ethane prices rise as you mentioned. But the good news is and I think this is very positive news is that, just as we've stated we're really trying to move towards being a volume driven company and with this short in the arm for the producers. The gas and the NGL prices, we think are going to spur additional drilling and additional volumes into our system and so frankly I think it's long term very healthy for our business. In terms of contract restructuring I think you'll see that we continue to restructure into away from the business and if you look at how rapidly our fee based business is growing over the period it's tending to push out the importance of those NGL margins. So we'll -- we are always looking to try to reduce the risk in exposure but it has to be done with an eye towards really the expected net present value versus the commodity risk and so. We are always looking to do that and we see great value and more predictable cash flows and so we are always working towards them.

Craig Shere - Touhy Brothers: I guess my question there was a little more focused on an appetite even if the individual investment is not as high return in balancing out your commodity exposures longer term. So you have a little less volatility. So in other words would you be willing to go into fresh midstream commodity exposed operations that would balance out your existing risks?

Alan S. Armstrong - President and CEO: Well I would say that I don’t see adding POP contracts as reducing risk all that much frankly. So I would say you'd see us investing more fee-based investments. I think POP is a different kind of risk, but I really don't see it balancing out all that much. Chris, we do have some contract that do reduce risk like our Laurel Mountain contract with Chevron that's a percent of gas, and that does, but that's not just limited to the processing business; that's on the gathering business as well. So, we certainly will look to those kind of opportunities that reduce our exposure to natural gas, but not necessarily adding length and exposure to NGLs.

Operator: Sharon Lui, Wells Fargo.

Sharon Lui - Wells Fargo: Just a couple of follow-ups. For the Atlantic Sunrise project, do you anticipate that seven times multiple at the start, or is there a stair step in the commitments to get to the full capacity?

Alan S. Armstrong - President and CEO: No, that is both initial and end-of-term revenue, so that's fully contracted from day one.

Sharon Lui - Wells Fargo: Then also for planned Canadian dropdown, any change in the target multiple? I think you previously mentioned around seven times?

Alan S. Armstrong - President and CEO: Sharon, we said less than seven times, and I think we're still in that same zip code.

Sharon Lui - Wells Fargo: I guess, given the recent news on Boardwalk, do you anticipate that this could have an impact or bearing on shippers' decision to commit to Bluegrass, or maybe on the way you would like to structure the JV, if the project goes forward?

Alan S. Armstrong - President and CEO: No, just to remind you, and I'm certainly going to be careful I'll not speak for Boardwalk here. But I'll tell you that Boardwalk's been very clear with us from the inception and certainly, recently reiterated that that Loews really stands behind the bulk of their capital commitment. So, we need to worry – the recent reduction in their distribution and the impact that's had on the Company. So, we're very excited to have them as a partner. They've been a great partner to work with and we really don't see any issues there, because they've got such strong backing from lows on the project.

Operator: Timm Schneider, ISI Group.

Timm Schneider - ISI Group: I was wondering if you guys can maybe discuss what you're seeing in terms of operating cost creep across some of your different service areas. So, if you look at Northeast for example, volumes and revenues were up pretty nicely, I think 18% sequentially, but that didn't really push through to the bottom line, were those kind of just one-time issues or is there something else going on?

Alan S. Armstrong - President and CEO: It really has been a lot of one-time issues. We also have allocated quite a bit of cost the way we are cleaning up what's been a pretty fast paced period up there, and I would tell you as we move forward, Jim Scheel and his team are going to be very focused on operational excellence and really fine tuning our cost structure up there. So, I'm very confident in our team's ability to do that. If you look at our overall cost structure across the entire Company, you'll actually see that, that actually between our O&M and G&A actually reduced a little bit from '12 to '13 which is pretty impressive considering the amount of growth that we've been managing. So I'm very confident about our team's ability to get after cost and get those in line. We've certainly been trying to make sure we got some of the reliability problems behind us and for the benefit of our customers and because we saw that as kind of job one. I think we've done that and reliability's been very, very impressive over the last six to seven months. It's come at some expense to get it there and I think that’s a lot of what you are seeing right now.

Timm Schneider - ISI Group: Then as a follow-up can you guys discuss maybe your preliminary funding plans for Atlantic access are you kind of happy with $2.1 billion I guess CapEx outlay at this point or would you consider selling some of that balance sheet to another party?

Alan S. Armstrong - President and CEO: No, I don’t think we would be planning on selling that down, it's part of the Transco system and as a result of that it's not an individual project. The way like a Constitution project is, so Constitution is not part of the Transco system and it allows for that, but being part of Transco makes that a little more difficult.

Donald R. Chappel - SVP and CFO: We like the risk return profile there and again most of that capital is in 2017, the amount of capital part of 2017 is pretty modest. So it puts it out in the period where we'll have a lot of capacity be looking to make big investments.

Timm Schneider - ISI Group: Lastly for me on Constitution is guess what are some of the big moving parts around the in-service state whether it's going to be kind of end of '15 or early '16 and how are some of the conversations going with producers in that part of the woods?

Alan S. Armstrong - President and CEO: Well you know that there is a Constitution system that’s fully contracted as you know and so the discussions are really more around what all we can do jointly to accelerate the permitting process. Really, the permitting is the issues I mentioned earlier. The FERC has certainly been constructive and they are pushing things along, but there are some permitting requirements in the State of New York that for various reasons can be a bit of a barrier. And frankly, I think we just got to work towards the right solutions that meets everybody's needs on that, and I still remain confident that we can do that. I think it's very clear politically that the infrastructure is desperately needed to serve the New England markets, and I think that bringing that to light clearly and firmly will help bring some reason to getting past some of the permit issues that we're facing right now.

Timm Schneider - ISI Group: So, was that more at the state level or was it actually landowners challenging rights-of-ways?

Alan S. Armstrong - President and CEO: No, it's state permitting issues.

Operator: Faisel Khan, Citi.

Faisel Khan - Citigroup: It's Faisel from Citi. I hate to beat a dead horse, but if I could just back to sort of the response that you guys have to the activism in the market and your stock, is there going to be like a formal response from all you guys to the activist shareholders sort of demands, or is there going to be any change in the Board over the next several months? I know that there were some requests by the activists to take Board seats too. So, just wondering is there a timeline when you have to respond to them or put out a formal sort of response and discuss sort of whether the strategic options whether you should adopt and the strategic options that they're recommending?

Alan S. Armstrong - President and CEO: Yeah. Well, really the only thing that really ask-for at this point is the Board seats and so, that's where the discussions have centered frankly and as you noted, I'm sure we put out an 8-K announcing that we had expanded or extended the window for nomination post this call in our 10-K release and that really was to eliminate any disclosure kind of risk and really allow the parties to have a more thorough discussion post that information being out there. So, I think you should see that as very accommodating on the Company's part and very interesting and continuing those discussions.

Faisel Khan - Citigroup: Is there a sort of a timeline when sort of these discussions end and you guys all present your sort of findings to the market or is it sort of just ongoing?

Alan S. Armstrong - President and CEO: I would say it's ongoing and certainly wouldn't try to speak for Corvex and Sorban, but I think from a Williams standpoint, we certainly are interested to re-engage in the discussions and again, just given the timing that we're up against with the window closing ahead of the 10-K in our earnings release, we just wanted to make sure that we didn't – that the compliance issues were first and foremost in the attendance of the various issues we need to deal with there.

Faisel Khan - Citigroup: Going back to the funding on Atlantic Sunrise. Do you guys envision sort of issuing sort of pick units in the future to fund the equity in this project or do you think that the cost of equity will be low enough at WPZ to sort of move forward with a common equity offering?

Donald R. Chappel - SVP and CFO: Faisel, one is that, the significant funding is a long way out, as I mentioned, the bulk of it is in 2017, so when we would expect the WPZ cost to capital to improve significantly, particularly as we, as Alan cited here we've got lot of projects that are expected to go in service here in '14 and '15 which will really boost WPZ cash flow and coverage and as we do that and a coverage comes back to I'll call it a more attractive level. We expect WPZ will trade in line with fundamentals. So I'd say we're optimistic WPZ will come back in line here over the next year or so.

Operator: Christopher Sighinolfi, Jefferies.

Christopher Sighinolfi - Jefferies: I guess first Don if you could talk about maintenance CapEx I realize in the prepared remarks you talked about some synergies that were realized in 4Q that led to the improved spend versus what you guided in the third quarter. But just wondering a bit more about that given that we didn’t see any change in '14 or '15 guidance is that more of just one time synergy and if so what sort of additional color around it?

Alan S. Armstrong - President and CEO: I think first of all the couple of drivers to that. We had a lot of maintenance capital items that had been driving a lot of the cost in '11 and '12 so they were Clean Air Act issues, there was a lot of required inspections on the pipeline to be done by a certain period smart inspections and so we got a lot of that out of the way. We also if you think about reducing risk on your systems and your asset integrity issues. You always want to hit the systems that have the most risk on them first and I would just tell you that our costs have been based just assuming that we would continue to find the same number of anomalies on our systems as we complete those smart pigging and some of the hydro testing. And in fact, as we've gotten further down to the profile and the lower risk assets, we've had less and less dig-outs, we've had less and less repairs required, and so that has driven some of that out. In terms of – so, if you're the team that's responsible for that asset integrity work when you do your forecasting for that, you go in assuming you're going to have a certain amount of digs, a certain amount of anomalies to clear, and if you don't find them then those costs don't show up. Certainly, the big cost is in the repairs of that. So, that's one item. Certainly, because we had such rough winter out West in particular towards – into the November and December timeframe, it slow down some of the work that we would have done in that period and would have expected to get done in the fourth quarter. So, a little bit of that will get pushed into '14, but it's not like you miraculously have a bunch of new capacity to get the work completed, so that tends to get pushed out into '15 as well. So, I would just tell you that we haven't backed off at all in terms of maintaining the integrity of our systems and spending the right money; we've just been very fortunate that a lot of the early work that we did was on some of our pipelines that needed the most reconditioning, and as we move into the less or the newer parts of our system and the areas that we've had less issues, our costs are coming down as we do that pipeline inspection and asset integrity work.

Christopher Sighinolfi - Jefferies: As you think about the '14 and '15 programs then, just as a quick follow-up, and what you have planned for asset integrity, might there be upside opportunities like what you mentioned where you find less there than what you think given where you're moving to or is it kind of an entirely different aspect of the system?

Alan S. Armstrong - President and CEO: No, I think we're having a hard time really believing we're going to get that fortunate on a repeated basis and so, I would just tell you our assumptions haven't baked that in at this point, but certainly that possibility exists, but we just haven't baked that in at this point. Secondly, I would tell you an area that may be an impact on that would be around well connect capital. Again, this is built in, because we've seen gas prices and NGL prices move up so nicely, we may see more drilling coming on, which might increase our well connect capital towards the last half of the year. Of course, we love spending that money to the degree that it's producing revenues for the future, but nevertheless, given the way we account for maintenance capital, we would include that well connect capital as maintenance capital.

Christopher Sighinolfi - Jefferies: I think that actually dovetails rather nicely out to questions I have on the West segment Alan, we saw the ethane equity volumes come down again in a big way in 4Q, obviously recognized rejections been something we've grappled with all year, but I was curious, two questions out there, one if there was something in particular that drove the change in 4Q that can be sort of isolated and highlighted and then two, as we think about '14 and '15 with commodity construct we're seeing today, if you've had any sort of revised views around what the volume could be out there. I did see WPX had numbers out last week calling some increased number out of their Piceance program for example, sort of how that might translate into what you guys are expecting at West?

Alan S. Armstrong - President and CEO: We have Allison Bridges to take that for us.

Allison G. Bridges - SVP, West: Yes, we did have some, a little bit of anomalies I think in the fourth quarter in that, we were third parties were actually continuing to recover and so we were actually giving them some of our equity ethane which was a positive thing from a financial standpoint. And additionally we did have a contract that terminated at the end of third quarter. So those two things caused a rather large drop in the fourth quarter. We have been seeing some declines in volume as you said we are starting to see some good signs with increased gas prices as well as WPX announcing that they were adding rigs. So we do believe that a little bit out in the guidance period we're going to start to see arresting some of those declines.

Christopher Sighinolfi - Jefferies: One final follow-up for me just to dovetail off of what Tim had asked earlier about cost. Alan, we did see a very strong beat relative to your guidance and obviously some costs continue in the northeast. You had mentioned as you have in earlier quarters about sort of this recalibration or reallocation of cost more towards northeast activity was any of that present in the fourth quarter or is that sort of heavy reach run rates we should expect from here.

Alan S. Armstrong - President and CEO: Just so as you know I think if you are just focused on the northeast segment you'll see movement; if you're looking at the total cost structure, you won't see that much movement as it relates to that allocation, because it's basically just pulling cost out of area where there is less activity and less growth and it's being applied. Again, that's done on a modified mass basis, which basically takes in as the primary allocation is the capital invested and the revenues, and so as both the capital invested and the revenues grow there, it'll shift more cost there. That doesn't necessarily mean that the cost of that business directly is going up, but it just is the way the method that we allocate cost across the business. And of course, we need to do that because we have regulated assets in our business as well, and so we need to make sure that we keep proper tallies on how we allocate those costs and we keep constant method going on how we do that. So, the answer to your question is, you'll probably continue to see some allocated costs even though, I would tell, in terms of the lack of operating profit performance in the Northeast for the fourth quarter, very little of that was driven because we were already expecting that cost allocation, a lot of the drivers; really a bunch of one-time issues that we had in the fourth quarter, as I mentioned earlier.

Operator: Becca Followill, U.S. Capital Advisors.

Becca Followill - USCA Securities LLC: On Atlantic Sunrise, are these – this 1.7 Bcf a day capacity incremental to the current throughput on that system that's really running from South to North?

Alan S. Armstrong - President and CEO: Yes.

Becca Followill - USCA Securities LLC: So, it doesn't reverse flow on any of the system to cannibalize the existing system, or is it all incremental?

Alan S. Armstrong - President and CEO: Well, I think if you just looked at our initial flows after the project is done, those two numbers are additive.

Becca Followill - USCA Securities LLC: So, it won't displace any of the existing, roughly 60% of contracts that you have rolling off by 2016?

Alan S. Armstrong - President and CEO: No, where the projects are going in deliveries for will be incremental and so, I think you could – really if you think about it, it's the amount of gas going off the system that you would see and so while you may see the benefit of physical displacement allow increase our capacity, so in other words, we don't have to build as much capital as you normally would think to get incremental volumes, because you've got gas coming from both directions. The volumes leaving the system will increase by that amount.

Becca Followill - USCA Securities LLC: Then on Bluegrass, when should we expect a go or no go decision?

Alan S. Armstrong - President and CEO: As we mentioned earlier, we're still in those discussions and I don't really think we should pin that down, but because – frankly, it took some really big commitments and we think it's the right project and it's taken some time to get people to make those huge long-term commitments but I really am not willing to put a specific timeline on that at this point.

Operator: With no further questions in the queue. I'd like to turn the call back over to Alan Armstrong for any additional or closing remarks.

Alan S. Armstrong - President and CEO: Great. Thank you, Dana. Well, thanks everybody for joining us. We remain very excited about the tremendous growth that we've got ahead of us and a lot of big capital investments as I mentioned really on the backs of lot of equity are really starting to come in to '14. We're pleased with the performance we saw for the fourth quarter and particularly pleased with some of the operational reliability improvements that we've seen across the systems and so we look forward to talking to you in the future and continue to talk about the great growth story that we have here at Williams.

Operator: Again that does conclude today's presentation. We thank you for your participation.