Question-and-Answer Session
Operator
(Operator Instructions). And your first question comes from Carl Kirst with BMO Capital. Please proceed.
[Michael Mazar - BMO Capital]
Hey, guys. This is actually [Michael]. Sorry about that, I was on mute. Had a question on the SouthStar deal. Can you tell us if there is any long-term debt sitting on SouthStar?
John Somerhalder
No, there is not.
Michael Mazar - BMO Capital
There is none? Okay. And then also, I know there is the $75 million facility that was fully drawn in at the end of 2008. Is that just normal for working capital purposes?
Andrew Evans
Yes, this is generally consistent with inventory build. We don’t have any outstanding under that facility today, because SouthStar is part of our money pool. So, any inventory built for them would be reflected in short-term balances at corporate, but, we haven’t had any need too, because of declining gas prices.
Michael Mazar - BMO Capital
I guess the next want to be on Sequent. Recognizing there is kind of a lot of noise going on there. Generally speaking, when we look at the business, we say after you normalize for all of the mark-to-market impact. It’s a business that’s going to run around $45 million on a core EBIT basis each year and with summer normally being around breakeven. So, we were looking at this most recent quarter and you back into and we normalize, and it looks like there might be a little bit of a hole. Is there anything else going on there, that we should be aware of?
Doug Schantz
Michael, this is Doug Schantz. Basically, the quarter, I mean, second quarter is shoulder month for us. Weather was weak. April was mild, June was mild, and so obviously, we feed on weather and volatility around our utilization of transport storage assets. So, that’s what you have to monitor going forth.
Michael Mazar - BMO Capital
Okay.
John Somerhalder
And this is John Somerhalder. I think you could see as far as commercial activity an ability to capture those types of spreads in the second quarter. So, there was a small hole. However, we did see an opportunity because of very solid storage spreads. We did see an opportunity there.
So, what we saw was that the negative on the one front was made up for by the positive related to storage and the inventory rollout schedule. So net, net we did not see a hole from our view.
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