DT Midstream Inc

NYSE:DTM

Q3-2025 Earnings Call

[Operator]

Welcome to the DT Midstream Third Quarter 2025 Earnings Call. As a reminder, today's call is being recorded. I will now turn it over to our speaker today, Todd Lohrmann, Director of Investor Relations. Please go ahead.

[Todd Lohrmann, executive]

Good morning, and welcome, everyone. Before we get started, I would like to remind you to read the safe harbor statement on Page 2 of the presentation. including the reference to forward-looking statements. Our presentation also includes references to non-GAAP financial measures. Please refer to the reconciliations to GAAP contained in the appendix. .

Joining me this morning are David Slater, President and CEO; and Jeff Jewell, Executive Vice President and CFO. So with that, I'll go ahead and turn the call over to David.

[David Slater, executive]

Thanks, Todd, and good morning, everyone, and thank you for joining. During today's call, I'll touch on our financial results, share details on the latest commercial activity and provide a status update on our key growth initiatives. I'll then close with some commentary on the current market fundamentals before turning it over to Jeff to review our financial performance and outlook.

So with that, we had another strong quarter financially. Our year-to-date performance is enabling us to increase the midpoint of our 2025 adjusted EBITDA guidance range to $1.13 billion, an 18% increase from the prior year adjusted EBITDA guidance. We are also reaffirming our 2026 adjusted EBITDA early outlook range. The third quarter was another active quarter for us commercially and the team continues to advance incremental organic opportunities that support our future growth.

We are announcing today that we've reached FID on a larger G3+ expansion on Guardian pipeline. The subsize expansion increases the total capacity of Guardian by approximately 537 million cubic feet per day, which is a 40% increase in the total capacity of the pipeline and the overall project is anchored by 5 investment-grade utilities under 20-year negotiated rate contracts.

This investment is supported by strong fundamentals, as there is robust gas and power demand growth throughout the region. We are also advancing potential upstream network opportunities, given the connectivity to DTM's broader portfolio, including pathways from vector and Midwestern pipelines as well as supply options from our natural gas storage facility and NEXUS. In order to offer our customers greater flexibility and reliability to meet their growing demand.

Turning to our construction activity. Our LEAP Phase 4 expansion facilities were placed into service early and on budget, increasing the capacity from 1.9 to 2.1 Bcf per day and providing reliable, timely access to rapidly growing Gulf Coast LNG markets. This expansion is underpinned by long-term demand-based contracts that will start in the first quarter of 2026. and I'd like to take a moment to recognize and thank our construction team for delivering another project early and on budget.

During the quarter, we also placed our Clean Fuels gathering project into service. and initial volumes are ramping as planned. I'd also like to address our Louisiana CCS project that remains pre-FID, as we've disclosed in prior quarters, we have progressed this project to be shovel ready while minimizing capital investment. The Louisiana department responsible for reviewing permit applications has recently reorganized and a moratorium has been announced on accepting new applications.

Our project remains under formal technical review and is not subject to the moratorium. But at this point, the permit time line is too uncertain to provide an updated date when we expect to reach FID. It remains an attractive project economically and strategically, leveraging our existing Haynesville assets and expertise. We will keep you updated as our application advances through the review process.

Finally, I'd like to take a moment to address the current natural gas market fundamentals and why I feel DTM is so well positioned. We have seen a positive shift in the Haynesville over the last few quarters and the record high throughput on our Haynesville system this quarter demonstrates the ability of producers to respond quickly to LNG demand signals.

With the recent commercial announcements of multiple LNG terminals, we certainly see opportunity for future expansions of our Haynesville network, including LEAP, which is in a strong competitive position given our connectivity to both basin supply and downstream demand markets. In addition to the growing momentum in the LNG market, we continue to have a very constructive view on gas and power demand growth in the country, fueled by increasing power generation needs from AI computing and data centers, along with industrial demand growth from onshore and manufacturing.

Moving to the regulatory framework. The recent Senate confirmation of 2 new FERC members was an encouraging sign and continued government agency initiatives that streamline approval processes while maintaining high-quality reviews give us increased confidence in a constructive permitting process for our key interstate growth projects.

I'll now pass over to Jeff to walk you through our quarterly financials and outlook.

[Jeffrey Jewell, executive]

Thanks, David, and good morning, everyone. In the third quarter, we delivered adjusted EBITDA of $288 million, representing an $11 million increase from the prior quarter. Our Pipeline segment results were in line with the second quarter. Gathering segment results were $10 million higher than the second quarter, driven by higher volumes on our Haynesville system, where production ramped faster than expected. Operationally, total gathering volumes for the Haynesville averaged 2.04 Bcf per day, setting an all-time record throughput for a quarter and a 35% increase over the third quarter 2024.

In the Northeast, volumes averaged 1.09 Bcf per day, driven by the timing of maintenance and producer activity, primarily on our Appalachia gathering system. As expected, we are seeing Northeast volumes ramp higher into the fourth quarter, with September averaging 1.17 Bcf per day, driven by incremental production on our Tioga system. And we continue to expect average fourth quarter volumes to be in line with the first quarter.

As David stated in his opening remarks, following our strong year-to-date performance and considering our expectations for the fourth quarter, we are raising our 2025 adjusted EBITDA guidance midpoint billion to $1.13 billion confirming our 2026 adjusted EBITDA [indiscernible] million. We are reducing our [Audio Gap] presents a $30 million reduction to the midpoint of our range. With the improvements in our distributable cash flow and capital expenditures, we expect lower year-end leverage of approximately 3.1x for on balance sheet and approximately 3.8x for proportionally consolidated.

For 2026, we are increasing our committed capital to $280 million, which reflects the upsized Guardian G3 expansion reaching FID. For our upsized Guardian expansion project, we expect to invest a total of $850 million to $930 million at a 5 to 6x build multiple with the project expected to be in service in the fourth quarter of 2028.

So overall, our committed capital has increased for the '25 to '29 time period to $1.6 billion, which reflects 70% of our $2.3 billion backlog, advancing to execution within just 9 months. We will provide an updated look at our overall backlog on our year-end call.

Finally, today, we also announced that our Board of Directors approved our third quarter dividend of $0.82 per share, unchanged from the prior quarter and we remain committed to grow the dividend 5% to 7% per year, in line with our long-term adjusted EBITDA growth.

I'll now pass it back over to David for closing remarks.

[David Slater, executive]

Thanks, Jeff. So in summary, we are very pleased with how the year is continuing to progress and are confident in our increased guidance for 2025, early [indiscernible] range for 2026 and long-term organic growth target of 5% to 7%. We are excited about the future opportunities ahead for the company as we remain focused on execution of our pure-play natural gas pipeline strategy and are well positioned with a strong balance sheet to fund incremental investments in this favorable market environment.

And with that, we can now open up the line for questions.

[Operator]

[Operator Instructions] We'll go first to Jeremy Tonet at JPMorgan.

[Jeremy Tonet, analyst]

I wanted to kind of maybe dive into the details a little bit more if we could. Louisiana has been a hotbed for data center activity. And just wanted to know if you could expand a bit, I guess, on the potential for your network to support some of this demand as it comes together for gas fired gen in the upcoming years?

[David Slater, executive]

Yes. Thanks for the question, Jeremy. There's a lot of demand materializing in Louisiana right now. I think the data center is one piece. The LNG demand is manifesting and lots of announcements this past quarter with incremental LNG demand. So we just see a robust market in that region. And we're aggressively pursuing that right now.

[Jeremy Tonet, analyst]

Got it. That's helpful. And I was just wondering if you could provide maybe a little bit more color on Haynesville and growth trajectory there, the volume jump. Just do you expect that to continue? What could that mean for LEAP expansions and particularly, I guess, West Haynesville potential?

[David Slater, executive]

Yes. There's lots of development happening there. We're really excited to see some of our customers getting excited about Western Haynesville. So that's an emerging play that's going to add our view, it will add significant runway to the Haynesville basin, which I think is strategically important for long-term LNG sourcing, supply sourcing. So we're excited about that.

It's very new, Jeremy. So I think that's going to be an area of focus over the next 12 to 18 months as we start to get a better sense of how those producers plan to develop that acreage and how the existing infrastructure fits into that plan. So more to come on that.

In terms of our volume ramp, I think we had been foreshadowing to our investors that we were expecting volume ramps in the second half of the year. To be honest with you, I was expecting it to come maybe a month or two later than it came, but I think it's a good example of the producer's nimbleness to respond to physical market realities on the ground. And we certainly saw that response in the third quarter.

I expect the fourth quarter to have a similar volume as the third quarter. But, yes, the nimbleness and quickness of the response, I think it's just a reflection of the new era that we're in and how producers have readjusted their business to be very responsive to demand signals.

[Jeremy Tonet, analyst]

Got it. That's very helpful. And one last one, if I could. As you speak to upstream Chicago opportunities, are you -- is this more of a vector or NEXUS or Midwestern? Just wondering, I guess, if you could provide a bit more color on what that would look like and what type of time line scope this would be? And just lastly, Gas Storage, if you can expand more on what that looks like is that Gulf Coast or Ohio?

[David Slater, executive]

Yes. So there's just lots of positive fundamentals unfolding in the upper Midwest right now. I'll just start there. Certainly, the upsized Guardian expansion has moved a significant amount of demand into that Chicago hub region. And I think that's going to draw incremental supply to that location. So we're obviously looking at Midwestern Vector and NEXUS, like I said in my opening remarks, as potential freeways to bring in incremental supply to that market.

As you may know, Vector is actively communicating an expansion of 400 million a day expansion westerly to Chicago out of the, what I'll call, the Greater Michigan area. So that's been shared with the shippers. That is under active discussions with potential shippers. The vector program, we expect that will go to open season probably measured in weeks, sometime probably in the next month. So that's just probably the most advanced.

We are on those 3 different pathways, but we're clearly looking at what can Midwestern do to bring more volumes into Chicago. And then how does our storage business fold into that demand, and in addition to that, looking at NEXUS as well. So we can offer our customers here kind of a wellhead to market solution, and that's really what I'll call the next phase of that growing demand in the upper Wisconsin region.

So very excited about it. But I don't want, Jeremy, to think that there isn't a whole plethora of other opportunities outside of what I'll call Wisconsin that are also percolating around the assets. There were some announcements this morning that I think are favorable. So there's just a lot going on right now. We're extremely vocal [indiscernible] execution here. The market is offering sort of a generational opportunity for expansion. And we [indiscernible].

[Unknown Analyst]

You want to pick up on some of those comments. Just around Wisconsin, David. It seems like there could be some more opportunities there just with some utility announcements. And so Curious if you're thinking about Guardian's ability maybe you can push further north in into Wisconsin. And are you sort of separately seeing any sort of increased interest to connect Guardian with [indiscernible]

[David Slater, executive]

[indiscernible] positive that we have right now is that Guardian is very expandable. So there's incremental ability for us to continue to expand Guardian. So again, this is just that a very positive demand fundamentals that we're observing [indiscernible] disciplined and looking to expand these pipelines beyond where we've announced again in a very disciplined fashion. So.

[Unknown Analyst]

Great. I appreciate that. Curious [indiscernible] on is that mostly pipeline gathering mix in between. So curious to get some color on what's left me thinking here.

[David Slater, executive]

Yes. Good question. I'll start with the highest-level message, which is we're incredibly [indiscernible] fortunate that backlog is in the pipeline segment, the FERC pipeline segment, which as we all know, is the most valued backlog. We won't get into all the unannounced projects. But the fact that we're this deep into FID-ing that backlog this quicker, than expected. And again, I'll just -- I'll [indiscernible] and the fundamentals.

[Operator]

[Audio Gap]

[Michael Blum, analyst]

I wanted to ask about the change in CapEx for the year, I think both on growth and maintenance, we should be assuming a lower run rate going forward because the pattern every year seems to be that you put a number out in guidance that [indiscernible] at the bottom of that range or even below in this case. So I just wanted to understand what's going on there.

[David Slater, executive]

Yes, I'll start and Jeff can chime in as well. But at the highest level, generally speaking, across all of our projects including our maintenance projects, the team has had an exemplary performance this year. and [indiscernible] in early, right, and [indiscernible] some of that we thought was going to come through in Q1 of next year. So both timing and timing usually also [Audio Gap]

For Millennium and Pro is going to be a heavier bigger lift and will involve what I'll call the regulatory complexities of New York and New England and we talked about that in the past, so I won't repeat all that on the call here. But yes, it's still moving, but it will move at a very patient pace. And again, when I talk about disciplined execution, this is a good example of we have to have all the boxes checked and all your ducks in a row here before we would be comfortable FID-ing these projects given the history with New York. So stay tuned and be patient and we'll keep the investors apprised as we hit significant milestones here. .

[Operator]

Our next question comes from Theresa Chen at Barclays.

[Theresa Chen, analyst]

David, going back to your comments on the extremely robust demand growth is generational opportunity, especially related to the gas to power them as a tailwind for your Northeast and Upper Midwest pipeline assets. Across these regions, your customers do have other transmission options. For the incremental expansion opportunities under development across your regions right now, how do you think your assets and projects compare versus your competitors' assets? What will it take to win these projects? Is it the well-headed market solution? And how do you plan to sustain the strong returns and keep the new multiple low? How much economically efficient expansion opportunities are there within your assets?

[David Slater, executive]

Theresa, that's a big question. I'll try to unpack it and answer it. So let's just start with, yes, there is competition in this region. There's many other pipes. But again, I think the opportunity set is significant, and there'll be plenty to go around, I'll say it that way. In terms of our competitive posture for these markets, a lot of it is geographical. A lot of it is going to be a function of the proximity that our assets have to the demand. And that, in some cases, will favor us, in some cases, may favor some of our competition. But again, I think the market opportunity set is so robust, there'll be plenty to go around. .

So when I look at all the opportunities we're pursuing, it's a really strong, robust, deep opportunity set. In terms of returns, again, these are all FERC-regulated assets. Let's just remind ourselves of that. The returns have to be at a level that it attracts the capital and competes with other opportunities in the portfolio. So I think the markets understand that. We've been very happy with the return profile of what we've announced to date and maybe I'll just leave it at that because, again, this is a competitive market situation that we're in right now.

So we're obviously going to be looking to find the right projects with the right return profiles and contract structure profiles that hit with our strategy. And I think you understand that we are very particular about that and very disciplined around that. So that's not going to change going forward. And I think I'm going to stop there. I think I answered most of that question, but if I didn't give me a follow-up. So...

[Theresa Chen, analyst]

Understood. Maybe pivoting to Nexus specifically on the heels of some of the recent developments out of Northwest Ohio, for example, what is your appetite and outlook for additional DTM opportunities off of NEXUS?

[David Slater, executive]

Yes. NEXUS is in a great spot for that Northwestern Ohio corridor. There's lots of activity there. There may have been some announcements recently that may have just come out. But yes, I feel really confident that NEXUS is going to pick up some market share on the data center power demand side and it's concentrated in that area of the state, and we're very well positioned in that area of the state. Just reminding everybody, it's a new pipeline, it's a high-pressure pipeline. All these power demand facilities want high-pressure gas and they want a corridor back into the basin, which, obviously, NEXUS provides. So I think NEXUS is in a really strong position to compete for that business. .

[Operator]

We'll go next to Manav Gupta at UBS.

[Manav Gupta, analyst]

My question here is that you -- in your prepared comments that you're looking to raise the dividend somewhere in that 5% to 7%. And I'm just trying to understand what could be the blue sky scenario where that number comes in closer to 7% than 5%?If you could talk about it, what could drive the dividend growth closer to 7% for the next couple of years?

[David Slater, executive]

Well, I'll start, and Jeff, you can chime in if I miss some of the details here, but -- so maybe we'll start by looking in the rearview mirror. So when we did the acquisition, we bumped up that dividend, right? So when we went through a period of growth year-over-year that was significantly in excess of our long-term targeted growth rate of 5% to 7%, we adjusted the dividend accordingly.

So when you ask the question, what would take us to the high end of that range. I think what would take us to the high end of that range is if we had a year where we had really strong growth and busted through the top end of that range. I think it would be reasonable to expect that we would -- that, that would reflect in the dividend growth rate. And Jeff, I think you would agree with that.

[Jeffrey Jewell, executive]

Yes. David, you're spot on, right? Our guidance has been we're going to grow the dividend in line with our cash flows, EBITDA growth. The other statement we've made is that we want to make sure that we maintain a very strong coverage above the 2x which we are. So I think that's the guidance is really look at our EBITDA growth and what we've communicated there the 5% to 7% long term, that's how we'll drive the dividend.

[David Slater, executive]

And last year, we had really exceptional growth, right, between the combination of the acquisition and the organic growth. I mean delivering that 18% growth that was a big year for us. So stay tuned, and we'll see what the future holds. But we obviously hunt for the high end of our range and beyond, as we've demonstrated in the past.

[Manav Gupta, analyst]

My quick follow-up here is you have been involved with data center providers for both front of the meter and behind the meter. I think at points of time, you indicated given the quality of the customer to a slight reference for front of the meter solutions. But we're seeing this massive explosive growth from behind the meter solutions now in fuel cells coming in. And I'm just trying to understand for the right customer and the right guarantees, would you be more open to behind the meter solutions also. And I'll turn it over.

[David Slater, executive]

Yes. The short answer is yes. And the art of that transaction is and how it's structured and the quality of the counterparty and having the right commercial structure. And yes, we are open to both in front of and behind the meter opportunities. And I am sure that we are going to bring home some behind-the-meter opportunities in addition to what we've done to date, which is predominantly in front of the meter.

[Operator]

Our next question comes from Keith Stanley at Wolfe Research.

[Keith Stanley, analyst]

Wanted to ask on Vector, David, I think you alluded to discussing a 400 million cubic feet a day expansion opportunity with customers. Would that primarily go to serve Guardian? Or how much of that might be needed to serve Indiana power demand? And then separately, how much could you ultimately increase capacity by on Vector?

[David Slater, executive]

Yes. Thanks for the question, Keith. So yes, that Vector has revealed that project to its customer base in the last couple of weeks. it's generic. I'm going to use the word generic, it can serve a number of egress options in the greater Chicago area. So yes, it can serve directly to Guardian. It can directly serve Midwestern and it can directly touch all the big utility loads in that greater Chicago area and it can touch some of our competitor interstate pipelines in the Chicago area that can project that supply across the state for your question. .

So we're testing the entire market in the greater Chicago area. Keith would be the best way to say it. There's obviously customers that are interested in this capacity. And I think the team will progress through what I'll call a standard process here where they communicate the project to customers. There'll obviously be discussions about rates and terms and tenure and all that good stuff. And the goal will be fairly quickly to get out with a binding open season.

[Keith Stanley, analyst]

Okay. Great. Second one, just a quick one with Haynesville volumes up so much in the quarter. Is it fair to say at this point, we're now past the MVC levels completely. And so incremental volume growth on your Haynesville system should boost EBITDA on a one-for-one basis.

[David Slater, executive]

Yes, Keith, we don't disclose the MVC levels anywhere in our Gathering business. But I think if you look back over the last 4 or 5 quarters, we tell you the volumes and you can see the Gathering segment EBITDA, you can probably answer that question closely just by doing the math.

[Operator]

We'll take our next question from Jean Ann Salisbury of Bank of America. .

[Jean Ann Salisbury, analyst]

I wanted to zoom in on Midwestern pipeline. You mentioned, obviously, that it could be 1 option for a feeder to Guardian going northbound. I believe you've also mentioned before that it could theoretically support a southbound expansion of a third-party Appalachia pipeline. Can you just talk about if those opportunities could potentially both happen, which would obviously be amazing or if they would be mutually exclusive, I guess, based on how much gas you could source..

[David Slater, executive]

Gene, that's a good question. So Midwestern is somewhat of a bidirectional pipe depending on the time of the year and where the demand manifests on the system that can move northernly or southernly and we've announced already that we're building a lateral to a new power plant often in Western. There's lots of power plant activity occurring right now on and around Midwestern.

So it's in a very unique situation where it can -- we can expand that northernly into Chicago and potentially to be expanding it southernly down towards the Nashville neighborhood where a lot of this power load is manifesting. So the short answer to your question is both, it can go in both directions. So like I said in my opening remarks, there's just lots of market presenting across the footprint right now. So we're pursuing all of these. And, yes, I think we're really excited about the opportunity set. It's our -- we have to go commercialize it now.

[Jean Ann Salisbury, analyst]

That's great. And then I guess, sorry, one more just about the Haynesville volumes. I wanted to follow up on your comment earlier that Haynesville volume in the 4Q would probably be similar to 3Q. I guess was the massive outpacing of your Haynesville volumes versus the basin over the last year, like mainly leg pull through, but that would kind of -- like that's happened now and you wouldn't expect to outpace the basin unless you built more leg, I guess.

[David Slater, executive]

I think the outpacing of the basin is really a reflection of our underlying customers and the quality of the resource that were attached to. That's probably the way I would describe it. That's probably -- yes, so we kind of -- we outpaced the basin and it's just a function of the resource was some of the best resource in the basin. So it was the first resource to be drilled. And we had this combination of private and public companies. And I think like I've said earlier, that the privates moved fairly quickly in the year and then the public pivoted on a dime quickly between the second and third quarter, as you see in our numbers, so just -- it's that new behavior that I alluded to earlier that all the producers are much more disciplined monitoring physical demand much more closely and are building capability to be very nimble. And I think that's reflecting in our numbers.

[Operator]

We'll take our next question from John Mackay at Goldman Sachs.

[John Mackay, analyst]

I want to spend some more time talking about some of the projects up in the Upper Midwest. One of them you guys have been kind of alluding to a little bit as a broader answer, maybe via NEXUS, a couple of other pipes to get gas down to the Gulf Coast. It looked like a Wave 3 LNG project or a couple of projects have needed to be kind of the anchors on something like that. I'd love to hear any color from you on if you're seeing that kind of shipper engaging with you in that market right now.

[David Slater, executive]

Yes, that's a good question. That's kind of what I'll call the over-the-horizon question, where in 5 years, where is that incremental 15 to 20 Bcf coming from and getting down to the coast. So there's a couple of people that have put their ore in the water to try to run up the flag pull some big projects. I'm not sensing at the moment, John, that they're getting traction.

The one thing that I think is changing kind of in the moment is this demand manifesting itself in the Midwest proper. And that demand is going to want to grab incremental Appalachian gas first. It's going to be cheaper, I think, to build and serve that demand than it is to try to pull that Appalachian gas all the way to the Gulf at least in the near term.

So I do expect we will continue to be testing the market on this longer-term Gulf demand that is going to need to be served I just don't think the market is ready yet, John. That's just my opinion at the moment, but it is being actively discussed. As you'd expect, we're part of those discussions. But it feels like it's a ways off yet before people get really serious about that.

[John Mackay, analyst]

That's clear. That makes sense. My second one is just a quick follow-up. I think it was to Mohan's second question. When you guys are talking about getting involved in the behind the meter side makes sense, it's in line with what you guys have talked about before. Are you exploring any potential projects where you'd be providing the power there as well? Or is your line still is we want to provide the gas and the pipe to get it there?

[David Slater, executive]

Yes, John, we're not going to change our strategic focus, right? I think we're really focused on our core business right now, and we have this generational opportunity in our core business, and I want to be 100% focused on that right now. And I want the entire organization focused on it, and I don't want to distract the organization with a similar but different line of business that we would embark into. My whole organization is very familiar with that business, John, given that we spun out of DTE. As you know, DTE, we built lots of generation, utility and behind-the-fence generation. .

So we're resisting the temptation to go there because we have such a robust opportunity set in our core business. And we're going to stay focused on that right now. So yes, we will go to a behind-the-meter opportunity, but our role will be expanding the freeway to that location or building the pipeline lateral from our big freeway pipes to the site. But we won't go behind the meter into the power generation component of that.

[Operator]

Next, we'll go to Gabe Moreen at Mizuho

[Unknown Analyst]

I just had a quick question on the next potential LEAP expansion here. And to the extent that you view the recent egress project completion, including LEAP 4 is maybe satisfying this next round of LNG projects that are basically going into service or do you think there's still more that needs to be gas and needs to be down south? And then also strategically speaking, there's been some consolidation, I guess, with gathering systems. Do you think there may be need to be some inorganic growth to drive volumes in order for another expansion to occur?

[David Slater, executive]

Dave, yes, there's more egress required to go down to the Gulf than exist in the network today. So even with [indiscernible] LNG 3 coming into service, and they're ramping as we speak. Once those systems are full, and I expect they're going to be full very quickly here, more capacity is required down there. And that's part of the reason why we're proactively expanding our connectivity to the future loads. So if you thumb through the deck, you'll see what I'm referring to here, expanding into the Woodside header system and additional expansion to Cameron for their additional expansions.

So we're just repositioning ourselves to be the preferred freeway down into these load centers. And again, there'll be some competitive tension in the process of chasing the new load, but like I've said in the past, and I think we've demonstrated, we'll win our fair share. I think we've disproportionately won our fair share to date. And we'll continue to win. And I'm sure some of our colleagues around us will win some incremental demand as well, but it's such a large growth area that there's -- it's just a really strong opportunity set right now.

So like most things, it's just a matter of timing and when those facilities feel comfortable making those commitments and then the Domino's kind of fall back up into the basin and people line up capacity.

[Unknown Analyst]

Great. And then maybe if I could just follow up with a small one on the MVP expansion, which itself just got upsized. I was wondering if there's any implications for your Stonewall expansion.

[David Slater, executive]

Yes. We view that very -- as a very positive fundamental event for the Stonewall expansion. And that's -- we view that as a strategic independent supply source into Mountain Valley for all the shippers. And we're in flight right now under construction on that project. So we view that as a very positive outlet and what we view will be a valuable outlet for the long term for all those Mountain Valley shippers. .

[Operator]

Our next question comes from Zackery Van Everen at TPH.

[Zackery Van Everen, analyst]

Maybe shifting over to the Tioga flows. Maybe a quick reminder. That system after the expansion is 210 MMcf a day, correct? And then is the expansion connecting to a new gathering system/customer, and that's where these volumes are coming from?

[David Slater, executive]

Zach. So we'll level set here with Tioga. Tioga is anchored by Seneca. Seneca is the customer of ours and this ramp was really Seneca getting in and drilling in the third quarter. So in terms of who their customers are, I don't know the answer to that, Zach. That would be a good question maybe for them. But they're our customer, our gathering customer. And yes, we're really happy with the expansion. And I'm not sure you had the right number there on the expansion and that may be something that you may want to follow up with Todd after the call on.

[Zackery Van Everen, analyst]

Okay. Sounds good. Appreciate the color there. And then maybe a quick one. I know we talked a little bit about the AI demand in Louisiana, but we've also seen a few upstream names as well as midstream talk about the industrial demand that's showing up there. Do you guys have connectivity? Or is that an opportunity you guys would also pursue if industrial demand was able to connect into your system?

[David Slater, executive]

Yes. The industrial demand doesn't get talked about a lot, Zach. So I'm glad that you're bringing it up on the call. There's significant domestic industrial demand in that corridor, that Louisiana corridor that is now sort of competing or battling for the molecules with the LNG terminals. So that's also become a pretty attractive market.

I think one of our customers may have talked about that on their recent call. So yes, the short answer to your question is yes, we are very aware of that. One of our previous expansions was sending gas to the system that predominantly serves those industrial markets. So yes, doesn't get talked about. I'm glad you're bringing it up. That's a good load for LEAP. And I'm glad you've asked the question.

I'd say the other thing, and I'm going to maybe deviate from your question and add in a little more color here is that some of those markets are interested in, what I'll call, lower carbon molecules. So whether it's our clean fuels project that is ramping up or whether it's our Louisiana carbon capture project, sort of the strategic rationale for those investments is fundamentally driven by this emerging market here domestically and internationally. Customers desiring a lower carbon footprint molecule. And those are long-term strategic fundamental value plays. I'll say it that way. And that's another benefit of our network with the carbon capture module that will eventually turn on once we get through the process with the state of Louisiana.

It's going to position LEAP, as we, I think, discussed years ago. We want to position LEAP to be -- have a low-carbon pathway wellhead to water, so I'll stop there, but the same holds true for industrials. There's industrials in the country that are beginning to become more sensitive to that topic and are expressing a desire for that lower carbon molecule as well.

[Operator]

Our final question comes from Julian DeMillanSmith at Jefferies.

[Unknown Analyst]

This is Rob Moskow on for Julian. Just 1 for me, maybe revisiting the Haynesville outlook in terms of your market share and serving that downstream LNG demand in the Louisiana corridor. Can you maybe talk through how you see that market share trending over time given the pipelines that are coming online and some of the new announcements in Louisiana and East Texas. And this connectivity into Carthage allow you to maybe maintain or even grow that market share. It just seems like even maintaining with the amount of growth that allow you to reach the upper bound of that expansion potential on LEAP.

[David Slater, executive]

Yes. Rob, and thanks for the question. And I think you might be batting cleanup right now. So it's always an enviable position to be in on the call. I think our market share I think I've been really pleased with the commercial team's ability to compete. And if you kind of look at how things have evolved over the last 2 or 3 years, we've gotten more than our fair share of the market.

So our market share is actually, I think, grown from, if you roll the clock back 2 or 3 years ago to where we are today. So that's encouraging. I expect, at a minimum, maintain that market share going forward. So I think that's the math that you were alluding to is that if the market grows by x, our goal is to hold the same percentage of that incremental that we currently hold today.

So that's going to require some work and confident that the team is positioned and you alluded to Carthage, and that's why those moves we made a year ago to create that connectivity to Carthage, I think was so important strategically for where we think this market is going in the next 2-5 years as we wanted to have really strong connectivity across the basin and likewise, have really strong connections across the markets on the southern end of the network so that we can compete effectively for that incremental growth. But I'll stop there.

[Operator]

And that concludes our Q&A session. I will now turn the conference back over to David for closing remarks.

[David Slater, executive]

Well, thanks, everybody. We certainly appreciate all the questions today. I appreciate your interest in the company and look forward to seeing everybody at the next conference. Take care.

[Operator]

And this concludes today's conference call. Thank you for your participation. You may now disconnect.