DT Midstream (DTM) saw a slight decrease in volumes on its network in third-quarter 2024. But the gas-focused midstream company isn’t too trouble, with forecasts showing growing demand for natural gas in 2025.

The company announced a final investment decision on its LEAP Gathering System Phase 4 Expansion project, which will increase capacity by 200 MMcf/d to 2.1 Bcf/d. The system is located on the Louisiana side of the Haynesville Shale. Completion is slated for the first half of 2026.

“I'd say some of the items we announced today feel encouraging—in terms of signaling that in 2025, at least in the Haynesville—our renewed interest in growing volumes again,” said David Slater, DT Midstream president and CEO, during the company’s Oct. 29 third-quarter earnings call. “The market clearly is seeing incremental demand coming.”

DT Midstream’s third-quarter net income of $91 million translated into a profit of $0.90 per share, $0.05 below market expectations.

In the latter half of 2024, natural gas prices have remained depressed and production has remained flat. Gas-focused DTM’s operations are based in the Appalachian Basin and the Haynesville Shale in Louisiana and Texas.

Over the quarter, traffic on DTM’s Appalachian network decreased, while volumes in the Haynesville increased slightly, said Jeff Jewell, executive vice president and CFO. Overall volumes averaged 2.88 Bcf/d, compared to 2.97 Bcf/d in the prior quarter and 2.99 Bcf/d in third-quarter 2023. The company expects volumes to increase in the coming winter months.

DTM’s 2024 net income is $19 million more than it posted during the same time last year. The company also raised its 2024 adjusted guidance EBITDA by 1% at the midpoint. DTM’s upped its EBITDA estimates to $965 million at the midpoint, up $10 million from its previous outlook of $955 million.

“The portfolio has been incredibly durable this year as we've gone through the commodity cycle,” Slater said. “We're very happy with how the year's played out, and it's allowed us to increase the guidance as we were navigating into Q4.”

The Detroit-based company’s board approved an approximately $0.74 per share dividend on its common stock. Fitch Ratings upgraded the company with an investment-grade rating over the quarter, raising its rate to ‘BBB-’ from ‘BB+’.

Slater said the company is currently in talks to supply natural gas to power data centers, but the projects were not ready to be announced.

The company is also adjusting to a major move in the natural gas E&P sector in 2024—Chesapeake and Southwestern’s merger to become Expand Energy. Expand Energy, now the largest natural gas producer in the U.S., is a major customer of DT Midstream, both in the Appalachian Basin and Haynesville Shale.

“We're patiently waiting for them to get through what I'll call the post-close activity, so we can sit down and have those conversations,” Slater said. “I'm highly confident that the acreage that we gather for them is premium acreage in their portfolio in the Haynesville.”

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