Pembina Pipeline Corp (PBA) (Q2 2026) Earnings Call Highlights: Record EBITDA and Strategic ...

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Adjusted EBITDA: $1.064 billion in Q2 2026, a 5% increase year-over-year. Earnings: $512 million in Q2 2026, a 23% increase from the prior year. Adjusted Earnings: $415 million in Q2 2026, a 10% increase year-over-year. Total Volumes: 3.7 million barrels of oil equivalent per day in Q2 2026, up 3% from the same period last year. 2026 Adjusted EBITDA Guidance: Reaffirmed at $4.35 billion to $4.55 billion, trending toward the midpoint. Pipelines Division: Higher contracted volumes on the Nipisi pipeline and higher revenue on the Cochin pipeline due to tariff adjustments, partially offset by a lower contribution from the Alliance pipeline. Facilities Division: Benefited from RFS IV fractionator entering service in May and the Wapiti expansion in PGI entering service at the end of March. Marketing and New Ventures: Results reflected wider WCSB and U.S. NGL frac spreads, benefits from West Coast exports, and higher crude oil prices and sales volumes. Corporate Segment: Lower results due to higher long-term incentive costs driven by an increase in Pembina's share price.

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Release Date: July 31, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Adjusted EBITDA of $1.064 billion in Q2 2026, a 5% increase year-over-year, driven by strong operational performance and new assets like RFS IV and Wapiti expansion. RFS IV fractionator and Wapiti expansion entered service on time and under budget, enhancing NGL and PGI capabilities. Sanctioned Heartland Extraction Plant and expanded ethane supply agreement with Dow by 15%, strengthening the integrated NGL platform. Positive FID on Greenlight Electricity Center, a 932-MW gas-fired facility for Meta, creating a new growth platform with stable cash flows and incremental natural gas demand. Cedar LNG project on track for late 2028 first exports, with key milestones achieved including pipeline mechanical completion and vessel hull transfer. Participation in the proposed West Coast oil pipeline positions Pembina to benefit from expanded market access and condensate demand, with disciplined capital allocation. Reaffirmed 2026 adjusted EBITDA guidance of $4.35-$4.55 billion, trending toward midpoint, with confidence in 5%-7% fee-based adjusted EBITDA per share growth through 2030.

Negative Points

Lower contribution from Alliance Pipeline due to new toll structure and revenue sharing mechanism, partially offsetting gains. Higher long-term incentive costs in Q2 due to share price increase, negatively impacting corporate segment results. Third quarter 2026 expected to be seasonally weaker, with lower NGL frac spread contribution and higher integrity and maintenance spend. Cochin Pipeline expected to have lower contribution in H2 2026 due to advanced take-or-pay commitments and price correlation. Hedged only 40% of Q4 NGL frac spread exposure, leaving potential volatility in marketing results. West Coast oil pipeline remains pre-FID with regulatory, cost, and volume uncertainties, requiring 18 months of development. Greenlight Phase 2 and other gas-to-power opportunities are still in early stages, with no clear timeline or size guidance.

Story Continues

Q & A Highlights

Q: There's a lot of talk in the industry with regards to incremental WCSB oil egress, Pembina, one of the projects being proposed. But I was just wondering if you could help me think a bit about the picture as a whole and how it impacts Pembina as it relates to condensate. It seems if there's sizable egress that's going to come on, that means there's sizable condensate needs. And I was just wondering how that gets solved? Is this Cochin expandable in any sense? Is in-basin production going to really tick up? Is it going to be a combination? I mean if it seems like in-basin is going to be part of the solution, that's a lot of volumes, a lot of growth to hit Pembina's system. Am I thinking about that the right way?A: J. Scott Burrows (President and CEO): That's one of our key fundamental tenets from our April strategy session. We talk about the flywheel, and we always start with oil sands growth. If the West Coast oil pipeline goes ahead 1 million barrels a day, that's going to require somewhere in the neighborhood of 300,000 barrels a day of incremental condensate. We have a firm view that the vast majority of that condensate needs to come from the WCSB, which is some of the reason we were getting ahead of some of our expansions in Northeast BC. Of course, you don't drill for condensate alone; you drill for natural gas that condensate comes along with. So we are going to need to find incremental home for natural gas, whether that's LNG Canada Phase 2, potential pushing incremental throughput through Cedar, as well as incremental data center demand. Cameron Goldade (CFO): When we acquired Cochin, that asset was running at about 85,000 to 90,000 barrels a day. Through some great operational work, we've managed to increase the capacity of that system to about 120,000 barrels a day, and it's running very firmly. That said, the opportunity for more imported condensate is also a potential solution.

Q: I wanted to revisit the 2030 growth outlook. I guess since you've provided that update, you've now sanctioned another $3 billion of projects, which I believe underwrites about 6% of that 5% CAGR range. So first, am I sort of thinking about that right? And as you think about that sort of remaining $2 billion bucket still up to sanction, how do you think about the ability to grow that opportunity set beyond $2 billion, but still be within that 2030 time frame that could maybe even take you above that 7% high end?A: Cameron Goldade (CFO): We would look at it similarly to you, meaning that we've crystallized or derisked a material portion of what was in that growth outlook from 2026 through 2030. As a reminder, that was somewhere between $1.50 to $2.15 of fee-based adjusted EBITDA per share growth between 2026 and 2030. What remains in that is a combination of some core volume growth within our business and some core capital investment opportunities. The biggest near-term lever for us on that 5% to 7% within the time frame is overall industry activity. The level of organic volume growth that was really embedded in our 5% to 7% was more historical looking, in the sort of 2% to 3% range for liquids. Some of our large customers are talking about multiyear volume growth in excess of that number through 2030, which would be very capital efficient for us. What we're really getting excited about, whether it's future phases of Greenlight or the West Coast pipeline opportunity, is the ability to extend that growth that we've signaled through 2030 into the next decade.

Q: Following up on the Greenlight side of things. With Phase 1 underway and as you have already consolidated the contiguous lands and in the process of commercializing Phase 2 and maybe beyond, would you expect the time line for further phases to be a little quicker? And anything to say on size and scope at this point?A: Chris Scherman (Chief Marketing & Strategy Officer): I don't think we can get into timing a lot. There's a few things happening in the market that you can look to for a little bit of guidance, the AESO's Phase 2 large load allocation that's underway and the continuation of the bring your own power strategy is a bit of a guide to think about timing. We've got a relatively proven model on how to progress these projects. We're really focused now on getting those front-end strategic sort of first-mover components in place, and we're working with customers to derisk them much like we did on Phase 1. I can't really give a guide on exact timing, but I can tell you we're moving quickly and with pace, but very much in a similar vein to how we've done on the last round.

Q: Maybe just staying on Greenlight here. I guess just broadly speaking, I know it's still early, but when you think about Phase 2 and when you think about another potential site, should we expect the economics and commercial structure and risk profile broadly to look like Phase 1 now that you've got that out there? Is that kind of like the blueprint or the rough template for how you're pursuing some of these other projects? Or do you think they're all kind of a little bit different?A: Chris Scherman (Chief Marketing & Strategy Officer): We really feel like we've proved out our thesis on gas-to-power as a midstream business in Alberta. Part of that is certainly the commercial construct and how we've thought about the risk profile and the fit of the project with how we think about our broader business. Future phases, we're targeting to structure them in a similar way to Phase 1. They're going to be long term. They're going to be fixed fee, low-risk arrangements that align with Pembina's business model. As you get out into expansions, not necessarily everything always looks the same out in time, but we've been really effective across all of our businesses of keeping that risk profile and keeping that structure in line with our business model, and this will be no different.

Q: So maybe just going back to the potential for incremental gas tier opportunities. I acknowledge kind of your comments, Terry, on the commercial structure there. But how should we think about the ownership structure if Greenlight is expanded, would that be with Connecticut or if you are looking for other opportunities, could you be a lead developer and 100% owner of those opportunities?A: Chris Scherman (Chief Marketing & Strategy Officer): We're really happy

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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