Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Xin Liu – JPMorgan.
Xin Liu – JPMorgan
Good morning guys. Questions on your Midstream NGL margins for your guidance, it seems like year-to-date your average realized margin is $0.27 and it seems like you took down the lower end of the NGL margin. Can you give us your outlook on the NGL market?
Alan Armstrong
First of all of course we saw a large improvement from first quarter to second quarter. We saw very nice increase in margins, mostly on the backs of ethylene margins which has improved dramatically. Recalling the first quarter we were in rejection in many locations. Here in the second quarter and into the current period we were into very improved margins on ethane.
That is largely driven by the large spread between crude oil and gas prices, and ethane right now is the only component that is in the money for ethylene crackers right now for in a cash margin basis. So we are seeing a lot of pull on ethane right now which is driving those ethane margins up and giving us some confidence about where they stand for the balance of the year at this point.
Xin Liu – JPMorgan
Another question for Ruby, how much do you have spent so far and factoring the equity contribution from your partner, how much you need to put out for financing the project during construction and what capital structure are to take after the completion?
Alan Armstrong
I am sorry let me clarify, we are not a financial partner in the Ruby project. My comment about Ruby earlier was simply the fact that El Paso now has a financial partner. There seems to be greater likelihood that the pipeline will be build creating more take away capacity out of the Rockies which is a good thing for Williams, since we have a lot of our production in the Rockies.
Xin Liu – JPMorgan
I’m sorry. I messed up with you said El Paso. Can you comment on your outlook on the Rockies basis?
Ralph Hill
This is Ralph Hill, the basis is done what we have thought would happens since May, we think with the severe decline in drilling in the Rockies and also the extra transportation capacity that has been built already, and we will be build with Bison, the Bison project and with the Ruby project.
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