NuStar Energy (NS) Q1 2019 Earnings Call Transcript

NuStar Energy (NS -0.70%)
Q1 2019 Earnings Call
May. 10, 2019, 10:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day, ladies and gentlemen, and welcome to the first-quarter 2019 NuStar Energy L.P. earnings conference call. [Operator instructions] As a reminder, this call may be recorded. I would now like to introduce your host for today's conference, Ms.

Pam Schmidt, vice president of investor relations. Ma'am, you may begin.

Pam Schmidt -- Vice President of Investor Relations

Good morning, and welcome to today's call. On the call today are Brad Barron, NuStar Energy L.P. president and CEO; and Tom Shoaf, executive vice president and CFO, along with other members of our management team. Before we get started, we'd like to remind you that during the course of this call, NuStar's management will make statements about our current views concerning the future performance of NuStar that are forward-looking statements.

These statements are subject to the various risks, uncertainties and assumptions described in our filings with the Securities and Exchange Commission. Actual results may differ materially from those described in the forward-looking statements. During the course of this call, we will also make reference to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered as alternatives to GAAP measures.

Reconciliations of certain of these non-GAAP financial measures to U.S. GAAP may be found in our earnings press release with additional reconciliations located on the Financials page of the Investors sections of our websites at nustarenergy.com. With that I will turn the call over to Brad.

Brad Barron -- President and Chief Executive Officer

Good morning. Thank you all for joining us today. In a few minutes, Tom will provide the details on our first-quarter results and confirm that we're on track with the annual guidance we gave last quarter. Before we get to the specifics of our results and our outlook, I'd like to provide a little color on our business as a whole, how well we're positioned day and what we're planning for the future.

Since the beginning of this year, macroeconomic factors, most notably oil prices, have improved, which is driving increasingly positive environment for our producer customers. And we're currently executing on a number of great high return projects with low multiples that build on our diverse asset platform across U.S. to provide strong earnings going forward. NuStar's project teams are executing with best-in-class safety performance, diligent spending oversight and smart project management on more projects in more places than ever before in our history.

I've mentioned on past calls, we also have more potential projects than ever before. We're actively developing projects to anticipate where our customers will need next, so that we can grow along with them. Large proportion of those projects, but the projects we have in progress and the projects we have in development are opportunities that are either inside the Midland Basin, we acquired our core Permian Crude System or outside the Midland Basin in Texas and even further afield with the ripple effects from the basin's tidal wave of WTI volume continues to generate high return projects that benefit NuStar. But it's not all about the Permian.

We've also identified great projects across our legacy assets that increase our market share and capitalize on regional supply/demand trends. A favorite example of our success with innovative customer focused project development is our series of relatively small spend, high return projects across our West Coast storage assets that are creating a biofuel specific storage network for customers, which include the largest biofuel distributors in the world to meet the region strict low carbon fuel standard requirements. But that's just one of many examples. It's amazing how much has changed for NuStar since our call around this time last year.

Since spring 2018, we've simplified our structure and eliminated the IDRs, minimized our need to access the equity capital markets, maintain strong coverage, divested our European assets at an attractive multiple and improved our debt metrics. On our call a year ago, we talked about the impressive growth of our Permian system in the then one-year anniversary of this acquisition, as well as our expectations for its growth trajectory. We're now celebrating the second anniversary of our acquisition of the Permian system and the system's performance continues to significantly surpass the basin as a whole. We're happy to report that we've continued to consistently grow our volumes quarter over quarter, year over year from the low 130s at the time of acquisition to over 380,000 barrels per day at the end of April.

And even with some historically inclement weather, not to mention much stored long-haul capacity constraint, over the past year we've grown our system throughput by 194%, far outpacing overall Permian Basin throughput growth of 78%. Our throughput has grown. We've also increased the capacity of our system to keep pace with that growth, from 412,000 barrels per day at the time of acquisition to 560,000 barrels per day today, which is a 36% increase in capacity since our acquisition of the system. On April 2018 call, we also previewed projects to take advantage of the burgeoning Permian driven Gulf Coast export growth at our world-class Corpus Christi export and storage terminal.

As we look back at what we're anticipating for our Permian system a year ago, for the basin as a whole and for us potential benefit for Corpus, we feel pretty good, because we definitely got it right. The Permian is indeed the place to be and it's also the genesis of a lot of the dislocations that midstream companies need to solve in order to continue to grow. What we didn't predict a year ago, and frankly, I don't think many experts, if any, anticipated, was the full breadth and depth of the positive impact that the Permian Basin and North American shale overall would have on growth in midstream opportunities. One year later, the critical role the Corpus Christi will play in the Gulf Coast export story has become even more clear.

By early 2020, approximately 2.1 million additional barrels of long-haul crude capacity from the Permian to Corpus Christi will be placed in the service, which will bring the total capacity of Permian crude to the Port of Corpus Christi up to about 2.6 million barrels, and make the port the No. 1 crude export outlet in the United States. Since this time last year, we announced we had signed a four-year commitment with Trafigura to support projects to initially connect our South Texas system with the Cactus II Pipeline near Oakville to transport WTI barrels on our existing 16-inch pipeline to our Corpus Christi, North Beach export terminal. And then to construct a new eight-mile, 30-inch pipeline from a new connection in Taft, Texas to our Corpus Christi terminal, as well as 600,000 barrels of additional storage.

Those projects are under way and on schedule. And we expect to begin providing service to Trafigura as soon as this summer, which will make new NuStar's dock facility the first facility from Port of Corpus Christi to export WTI volumes that were transported to South Texas on one of the three new major Permian to Corpus long-haul projects. Beyond this project with Trafigura, we have a number of other projects that are in development, undergoing vetting and in advance stages of negotiation to build upon our Corpus, Taft, South Texas advantages. And aside from the Corpus Christi export growth, we've also seen substantial benefits of Permian growth on our South Texas Crude System in the Eagle Ford, which is again benefiting from WTI volumes arriving by truck.

We're currently seeing volume receipts of around 160,000 barrels per day, significant above our minimum volume commitments of 116,000 barrels per day for that system. Recently, we also completed expansion of our r Wichita Falls crude oil pipeline, about 300 miles to the northeast of Midland, to transport Permian barrels to local refiners from the Sunrise Pipeline expansion. In addition, we have completed a related expansion project on the same system into Hewitt, and we will begin delivering barrels to Plains to move into the Longview market, which we expect to produce a healthy return for a relatively small capital outlay. The ripple effects from increased production of Permian Basin barrels, as well as from demand for volumes from other shale plays has given us the opportunity to restart our unit train off-loading facilities at our St.

James, Louisiana terminal for customer commitments of at least 10 trains per month bringing WTI, Bakken and WCS barrels to the Gulf Coast. Beyond the unit train opportunities that we are seeing in the near term, our St. James facility is positioned to benefit in the longer term from the impact of large scale shifts in crude flows from North American shale plays. As some of you likely know, pres-shale play revolution, St.

James became a critical hub for importing crude oil despite refineries in the region and further inland across the Mid-Continental United States. With the inbound capacity of 3 million barrels per day, regional storage capacity in excess of that of Cushing, Oklahoma, 3 million barrels an outbound pipeline capacity and 2.6 million barrels of regional refining capacity, St. James is truly the heart of the complex circulatory system of U.S. energy infrastructure.

As the U.S. is shifting from a net importer to a net exporter of crude, so too is St. James' role shifting. With the completion of Bayou Bridge, which is bringing volumes of both Bakken and Permian crude to St.

James, marks an important first stage in that shift. And in March, we began receiving volumes from Bayou Bridge into our facility through our recently completed connection to that line. Those Bayou Bridge volumes are destined for regional refineries, but also for export out of St. James.

And we see another critical step in St. James' transformation into an export facility on the horizon, the anticipated reversal of cap line could bring significant volumes of Bakken, WTI and eventually WCS to St. James for use in regional refineries, as well as for export. Moving on from shale plays to refined products, on our call last spring, we announced the first of our two projects to facilitate the export of refined products in Northern Mexico.

The Nuevo Laredo project for Valero is scheduled for early service this summer and our second project, the Valley pipeline project will be in service later in the year. We're excited to be able to redeploy underutilized asset assets in South Texas to play an integral role in helping to meet Mexico's growing need for refined products. In addition to our Mexico projects, one year ago, we talked about the synergies we expected from a small bolt-on acquisition from CHS or the Council Bluffs assets which we acquired to expand our market share on our Central East System. Thanks to that strategy, we have successfully increased our capacity, enhanced our market research and expanded our platform for butane blending on that legacy system.

Looking back to what we told you last spring, I am proud of the progress we've made. The mark to improve our balance sheet and our financial metrics, we have continue to plant seeds for future growth through our projects in the Permian and our projects to build on our legacy assets. And as we expect to begin to reap the benefits of our growth programs starting later this year and the associated EBITDA to continue to ramp up as we complete projects in 2020. While I talked about a lot of things we have planned and executed as well as things that we did anticipate, there is one thing that we did not know year ago.

On the call last spring, we expressed cautious optimism about the improved activity about PDVSA at our St. Eustatius facility in early 2018. Circumstances have changed significantly since that time. The deterioration of Venezuela's economy has accelerated and then in January, U.S.

issued additional PDVSA specific sanctions, which required us to wind down our contracts of PDVSA by the end of February. Over time, it's become increasingly clear that St. Eustatius facility requires a new business model to ensure its long-term success and that NuStar's best path forward is to sell the facility to a buyer that is well-positioned to take advantage of the changing global crude trade flow patterns. We are pleased to announce that we have signed a definitive stock purchase agreement to sell the facility to Prostar Capital for approximately $250 million subject to adjustments.

The sale will allow us to redeploy the sale proceeds to improve our financial metrics and to fund our growth projects for our core business here in North America. We are very gratified to be able to hand over the reins to purchasers with a business model that ensures a bright future of facility and our employees there. We expect to close this transaction by the end of the second quarter, and we look forward to focusing all our resources on strengthening our financial metrics to generate stable consistent growth for our unit holders. Now I will turn it over to Tom.

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Thanks Brad, and good morning, everyone. Before I get into the details about our quarterly results, I would like to first provide a little more context around the financial impact of our decision to sell our St. Eustatius facility. In connection with the agreement to sell our St.

Eustatius operations to Prostar, our first-quarter results include non-cash impairment charges totaling $328 million related to our St. Eustatius operations. It is important to note that the aggregate amount of the impairment charges is not included in either adjusted EBITDA or DCF. As Brad mentioned earlier, we achieved strong consistent results for the first quarter of 2019 and we are maintaining our adjusted EBITDA guidance for the full year at $665 million to $715 million.

However, before I turn to our results, segment performance and the projections, I will first touch on a few items of note in each of the first quarter of 2019 and the comparable period in 2018. In order to aid in the quarter-over-quarter comparison, we have adjusted our reported results for these items to ensure that we are looking at things apples-to-apples. First, our first-quarter 2019 EBITDA net income and EPU include the $328 million non-cash impairment charges related to St. Eustatius, as I just described.

Second, you may recall, that our first-quarter 2018 EBITDA, net income and EPU, included a gain of $79 million from receipt of hurricane related insurance proceeds related to the damage sustained at that terminal. In the earnings press release, we included a table showing first-quarter 2019 and 2018 EBITDA, net income and EPU as adjusted to eliminate both the impairment charges and the insurance gain, so that quarter-to-quarter results are comparable. Today, I will be referring to those adjusted numbers. In first-quarter 2019, we generated adjusted EBITDA of $171 million consistent with the first quarter of 2018 adjusted EBITDA.

Adjusted net income for the first quarter of 2019 was $51 million, up $4 million over adjusted net income of $47 million in the first-quarter 2018. First-quarter 2019 adjusted earnings per unit was $0.14, compared to adjusted EPU of $0.33 for the first quarter of 2018, mainly due to additional outstanding units, including 13.4 million units issued in connection with our simplification transaction that merged NuStar GP Holdings and NuStar Energy in the third quarter of 2018, as well as increased preferred unit distributions. First-quarter 2019 DCF available to common limited partners was $95 million, up $3 million from the first quarter of 2018 and our distribution coverage ratio for the common limited partners was approximately 1.47 times. First-quarter 2019 EBITDA in our Pipeline segment was $108 million, up $14 million or 15% from the first quarter of 2018 due to continued throughput volume ramp on our Permian Crud System, increased quarterly volume receipts of 168,000 barrels per day on our South Texas crude Oil Pipeline System and increase volumes on our East Pipeline System driven by our CHS, Council Bluffs, Iowa acquisition in the second quarter of last year.

These were partially offset by lower throughputs on our McKee System due to operational issues at one of our customer's refineries. First-quarter 2019 adjusted EBITDA in our Storage segment was $82 million, down $8 million, compared to the first quarter of 2018 EBITDA of $90 million, due mainly to the sale of our European assets in the fourth quarter of last year and the impact of decreased storage rates at certain East Coast and Gulf Coast locations due to recontracting in the midst of last year's backwardated market conditions. Offsetting these quarter-over-quarter declines were increased storage and dock fees at our Corpus Christi North Beach terminal, as a result of the increase volumes we experienced on our South Texas Crude Oil Pipeline System. Additionally, first-quarter 2019 storage revenues include the acceleration of approximately $16 million related to nonrefundable settlement proceeds received last year as part of our contract restructuring with PDVSA.

We intended to recognize those proceeds month-by-month to offset storage charges owed by PDVSA through mid-September. However, because of the U.S. sanctions imposed on PDVSA, required us to wind down our contracts by the end of February. We were also required to recognize the remaining balance of PDVSA settlement payment at that time.

First-quarter 2019 adjusted EBITDA in our Fuels Marketing segment was $6 million consistent with our first-quarter 2018 EBITDA. On March 31, debit balance was $3.3 billion, our debt to EBITDA ratio was 4.1 times, significantly below our credit agreement covenant threshold of five times. Now let me spend a few minutes talking about our projections for full-year 2019. The following 2019 projections do not include the pending sale of our St.

Eustatius operations. However, as we've said, we expect the pending sale to positively impact our key financial metrics, including adjusted EBITDA, reliability capital, DCF, coverage ratio and debt to EBITDA. As I said earlier, we expect NuStar's 2019 adjusted EBITDA, which includes the effect of the non-cash impairment charges to be in the range of $665 million to $715 million. With regard to 2019 capital spending estimates, we continue to expect $500 million to $550 million of spending for strategic and other capital in 2019 with spending of approximately $185 million on Permian Crude System, $150 million for the Northern Mexico refined product supply projects and about $100 million for Corpus Christi North Beach terminal export project.

Regarding our reliability capital spending for 2019, we continue to expect to spend $70 million to $90 million, which includes about $30 million of hurricane repairs that will be paid with insurance proceeds and $11 million to complete work on our ammonia system replacement project. Based on these projections we continue to expect our common unit distribution coverage ratio in 2019 to be in the range of 1.2 times to 1.3 times. And with that I will turn the call back over to Brad for his closing remarks.

Brad Barron -- President and Chief Executive Officer

Thank you, Tom. We've come a long way since last spring, and we are excited about continuing to execute on our projects and our plan to achieved long-term stable growth for our unit holders. And while no midstream company likes to sell assets, decision we've made on our St. Eustatius facility will allow NuStar to deploy our capital in North America will generate the strongest returns for our investors and continue to lower our leverage and strengthen our balance sheet.

We are excited about the abundance of higher return, organic gross projects that we have in development and in progress. And I am already looking forward to our call in next spring -- spring of next year, and I am confident we will reporting once again on our successful execution of the opportunities we talked about today, as well as the opportunities we hope to be able to announce in the near future as those come to fruition. Thanks for listening in today and I will open up the call for Q&A.

Questions & Answers:

Operator

[Operator instructions] And our first question comes from Theresa Chen from Barclays. Your line is open.

Theresa Chen -- Barclays -- Analyst

Good morning. Thank you for taking my questions. First, I wanted to ask about the economics related to the St. Eustatius sale.

Do you have an idea of what the current EBITDA annualized run rate is, and what it would be on a normalized long-term basis looking through the cycles?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, as far as EBITDA goes, I mean, we had already adjusted out the effects of having to wind down the PDVSA contract and those type of things, the acceleration of those revenues into the first quarter. And so, what we've been saying on this so far is that, look, we've put the guidance out there. We've reiterated the EBITDA guidance. We don't expect this sale to be outside the range that we put out there for our EBITDA.

Theresa Chen -- Barclays -- Analyst

OK. Maybe I can ask it a different way. What was or is the expected multiple on the sale?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, it's -- I can tell you it's a very attractive multiple for us. We're very -- we're pleased with the multiple.

Theresa Chen -- Barclays -- Analyst

OK. In relation to the acceleration of revenues of -- for the PDVSA wind down, Tom, how much was that exactly that impacted Q1?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

It was approximately $16 million that we accelerated into the first quarter.

Theresa Chen -- Barclays -- Analyst

OK. Got it. And then turning to your Permian system, I understand that volumes exceeded at 380,000 in April. What was the average throughput in first quarter?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

349,000 -- right at 350,000. Yeah.

Theresa Chen -- Barclays -- Analyst

OK. Great. And what's your expectation for exit for this year?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

450,000.

Theresa Chen -- Barclays -- Analyst

Perfect. Thank you very much.

Operator

Thank you. Our next question comes from Shneur Gershuni from UBS. Your line is open.

Shneur Gershuni -- UBS -- Analyst

Hi. Good morning, guys. You say it was a very attractive multiple on sale. I mean, there's a big announcement earlier today, which I'm sure you saw.

When you think about it on a 2020 basis, do you feel that you sold the asset in line with other transactions that were out there?

Brad Barron -- President and Chief Executive Officer

What I can tell you is, it's an attractive -- we believe it's an attractive multiple. It's in line with what we were expecting to get from the asset. So the benefits of the transaction are many. This allows us to continue to delever and continue to reinvest in some really great high-return, low-multiple projects in the Permian and elsewhere in North America.

Shneur Gershuni -- UBS -- Analyst

OK. Fair enough. And just following up actually on those comments. Does this address the credit rating issues with the agencies? Do you get upgraded to a stable outlook? And are you able to do the refinancings that you've been talking about in the past?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, based on our conversations with the rating agencies, I think, they've already -- at least our conversations with them, they've already taken whatever action they expect to take probably through 2019. And so I wouldn't expect any movements by the agencies this year. But, certainly, we've been working very closely with them over the last year. They have viewed everything we have done and our projections very positively.

That was what they told us. And so, they're looking forward to 2020 and beyond when Permian ramps up, these projects come on, and all that. So we'll just have to wait and see what ends up happening with each one of them. But we have gotten positive responses from them.

Shneur Gershuni -- UBS -- Analyst

In terms of any refinancings, does this clear the deck for you to be able to move forward?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Yeah, it does. I mean, I think that, we've talked about a pending bond issue that we'd like to get done this year. And I think we still have plans to do that. And we plan to term up some of our revolver with the bond issuance.

And -- so yeah, I think that paves the way.

Shneur Gershuni -- UBS -- Analyst

All right. Fair enough. Thank you very much.

Operator

Thank you. Our next question comes from Jeremy Tonet from J.P. Morgan. Your line is open.

Jeremy Tonet -- J.P. Morgan -- Analyst

Hi. Good morning. Just want to follow up with St. Eustatius sale bit here.

Was curious how the process went here? Was this an open auction? Or was this just they approached you? Any color on that.And then also, was just curious how much this reduces your opex or your fixed costs by just kind of thinking about the business going forward?

Brad Barron -- President and Chief Executive Officer

So in terms of the sale process, it wasn't an open auction. It's -- we've had discussions with Prostar for quite a while, and we were able to come to terms just recently. And so we -- and like I said, it was an attractive multiple for NuStar. So -- and what was the second part of your question?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Financial impact on opex and those type of things. And like we said, I think, this is absolutely -- it's going to be positive for us in terms of all of our key metrics, and including opex and everything. I mean, we will pull that out. It's EBITDA -- adjusted EBITDA positive, its DCF positive, key metrics positive.

So this is kind of one of the things we've -- it's been part of our strategy to look at less core assets in our portfolio and have asset sales to help us delever. So this helps us move toward that goal.

Jeremy Tonet -- J.P. Morgan -- Analyst

That's helpful. Thanks. And just noted the language that you said there it was subject to adjustment, I think, it's said in the PR. Is there anything outstanding with Venezuela? Or is that just kind of a customary language there? Just trying to see if those payments everything --

Brad Barron -- President and Chief Executive Officer

Customary language.

Jeremy Tonet -- J.P. Morgan -- Analyst

OK. That's helpful. Thanks. And then IMO 2020, just wondering if you guys could provide any color on -- is this starting to seep into customer conversations? Are you seeing any incremental demand on that side?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

No, we're not seeing anything yet. There's still no compelling contango in the market out there that we see. Nobody's coming inquiring for additional storage yet. We're well suited to benefit from that, if and when that does occur.

Jeremy Tonet -- J.P. Morgan -- Analyst

And just as far as portfolio optimization, should we expect any other asset sales here? Are you guys kind of happy with where the things stand?

Brad Barron -- President and Chief Executive Officer

We're happy with where things stand.

Jeremy Tonet -- J.P. Morgan -- Analyst

Gotcha. OK. I think that's it for me. Thanks for taking my questions.

Brad Barron -- President and Chief Executive Officer

Thanks.

Operator

Thank you. Our next question comes from Ryan Levine from Citi. Your line is open.

Ryan Levine -- Citi -- Analyst

Good morning. I just want to follow up on the -- your comment that this transaction is EBITDA positive. Is that to -- should we be assuming that pro forma for the pull forward of the PDVSA impact to Q1, that EBITDA expectations in your guidance for St. Eustatius was negative for the remaining portion of the year?

Brad Barron -- President and Chief Executive Officer

Yeah, you can assume that.

Ryan Levine -- Citi -- Analyst

OK. And then the other question is, could you speak to if there's any tax leakage or any benefits associated with this transaction given the jurisdiction?

Brad Barron -- President and Chief Executive Officer

No, there's no significant tax leakage or anything like that.

Ryan Levine -- Citi -- Analyst

OK. Thank you.

Operator

Thank you. Our next question comes from Dennis Coleman from Bank of America Merrill Lynch. Your line is open.

Dennis Coleman -- Bank of America Merrill Lynch -- Analyst

Good morning, everyone. Thanks for taking my question. Sorry to keep beating on this EBITDA issue, but we had some sort of tailing impact -- positive impact from the PDVSA payments into the middle of this year, or I guess, into the third quarter and so you've accelerated that. So in some way that would be -- it would seem to be a negative impact on EBITDA.

And so, I just want to make sure I'm understanding exactly what you're signaling here. You're reiterating your guidance, there won't be any adjusted guidance for the impact of the sale, if I'm hearing it right. But should we think then about EBITDA coming in toward the high end of the range, because of this positive impact that you're talking about?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

I think that'd be a little aggressive at this point. We're not -- like I said, we're just reiterating the range that we have out there. We think the EBITDA range is good. And that's kind of where we're at.

So whether or not we come in at the midpoint or higher or lower, we're not really ready to -- it's kind of early in the year to kind of predict all that right now. But I can tell you that we feel very comfortable with the range right now as it is.

Dennis Coleman -- Bank of America Merrill Lynch -- Analyst

OK. So we shouldn't expect any sort of adjustment to the range to pro forma for this set?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Not at this time.

Dennis Coleman -- Bank of America Merrill Lynch -- Analyst

OK. Maybe just one operational. With regard to the St. James opportunity, maybe just a little more detail.

I think in the past it was sort of five to 10 unit trains. Now I think you're saying firm 10 unit train. You're talking about taking volumes off of Bayou Bridge. Maybe if you can be -- is there upside to the unit train count? Is there -- how much volume are you getting off Bayou Bridge? Is there the possibility of expanding facilities there to take more? Just trying to scope what the upside is here.

Danny Oliver -- Senior Vice President, Marketing and Business Development

Yeah. So this is Danny Oliver. So we are receiving steady volumes off Bayou Bridge. We have no minimum volume commitments on that, but we do expect to continue to receive a steady diet from Bayou Bridge.

That certainly strengthens the storage market there and we have room to expand at St. James if the demand dictates. As far as the unit trains go, we did take out the five to 10 and put in 10, because it's now that the full 10 is covered by minimum commitments. But there is upside to that number -- significant upside to that number.

Dennis Coleman -- Bank of America Merrill Lynch -- Analyst

OK. That's it for me. Thanks.

Operator

Thank you. [Operator instructions] And our next question comes from Sunil Sibal from Seaport Global Securities. Your line is open.

Sunil Sibal -- Seaport Global Securities -- Analyst

Yeah. Hi. Good morning, guys. A couple of questions from me.

I think your leverage at the end of the quarter. You mentioned that could -- I just missed that. Could you repeat that? And also, what's the leverage pro forma for this sale?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

I think we said it was 4.1 at the end of the quarter. I haven't -- I think we're just reiterating the guidance we gave before for the debt leverage at this time. Upon closing of the transaction, we'll take another look at that and see if we can adjust that.

Sunil Sibal -- Seaport Global Securities -- Analyst

OK. Got it. And I think you mentioned on the proceeds of $250 million adjusted for -- with some adjustments. Any major kind of adjustments we should think about between now and closing of the transaction? Or what could go in that bucket, I'm just trying to understand that.

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, I mean, it's an -- it's a sale of an asset. I mean, what we're talking about is what adjustments that are customary for that type of a disposition. So that's probably most of it. And I don't know if there's anything major that we want to point out in that.

It's just --

Brad Barron -- President and Chief Executive Officer

They were all customary.

Sunil Sibal -- Seaport Global Securities -- Analyst

OK. Got it. And then just moving on to your St. James position, could you remind us how much acre of land you have there and what's the kind of opportunity set for you in terms of even expanding your storage there?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

I couldn't tell you exactly how many acres it is, but we have significant room for expansion.

Sunil Sibal -- Seaport Global Securities -- Analyst

And where are you in terms of the current storage there and how many million barrels?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

About 11 million barrels. It's fully leased out.

Sunil Sibal -- Seaport Global Securities -- Analyst

OK. Got it. And what are the terms on those lease in terms of expiry?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, there's a bunch of different contracts, but most of them are in the kind of one- to three-year range. I did -- just get handed some information. We have 900 acres there at St. James, so there's a lot of room for expansion.

Sunil Sibal -- Seaport Global Securities -- Analyst

OK. Got it. That's all I had. Thanks, guys.

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Thank you.

Operator

Our next question comes from Selman Akyol from Stifel. Your line is open.

Selman Akyol -- Stifel Financial Corp. -- Analyst

Thank you. I just wanted to clarify, on your growth capital you said that was $500 million to $550 million. Did I get that correctly?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

That's right.

Selman Akyol -- Stifel Financial Corp. -- Analyst

OK. And I guess on the -- your listing there of projects kind of takes you to $435 million, if I had that correctly between the three? So can you just talk about what maybe in the remaining $65 million to $115 million?

Danny Oliver -- Senior Vice President, Marketing and Business Development

There's probably 20 other projects. We have just kind of a steady diet of small projects around our legacy system. Some of those are on the West Coast. Brad talked about those.

There's a handful of projects there that are relatively small, but --

Brad Barron -- President and Chief Executive Officer

Yeah. We were trying to hit the big items. I mean, we've got about $24 million of West Coast spend that we didn't list. But other than -- like Danny said, other than that, it's just smaller items.

Selman Akyol -- Stifel Financial Corp. -- Analyst

I appreciate that. And then when I think about this, should I be thinking about these smaller projects as being higher multiples compared to your average?

Danny Oliver -- Senior Vice President, Marketing and Business Development

They tend to be, but we've got some pretty low multiples on some of the big projects that we've mentioned as well.

Selman Akyol -- Stifel Financial Corp. -- Analyst

Fair enough. And then as we think about St. Eustatius, I mean, I think, we could all agree that was a challenged asset and so the outlook. Was there anything in the capex now that could be -- you're thinking of repurposing assets there that sort of capital avoidance we should be thinking about?

Tom Shoaf -- Executive Vice President and Chief Financial Officer

No, as we said, we're using the proceeds to pay down debt and to help fund our capital program that we -- that already exists. So it's just going to help our metrics is what the key component there.

Selman Akyol -- Stifel Financial Corp. -- Analyst

All right. Thanks so much.

Operator

Thank you. Our next question comes from Michael Blum from Wells Fargo. Your line is open.

Michael Blum -- Wells Fargo Securities -- Analyst

Hey, good morning. Just, I guess, two questions on St. Eustatius. One is, excluding the PDVSA, can you talk about what the utilization of the facility has been? That's No.

1. And then No. 2, I guess related to that, can you talk about maybe what peak EBITDA has been historically for that asset?

Danny Oliver -- Senior Vice President, Marketing and Business Development

Well, let me discuss the utilization first. So the outside of the PDVSA tanks that we got back, the terminal is fully leased. So at their peak, they leased out about two-thirds of the terminal. The other third was and is full.

And I'll let Tom take the other part of that question.

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Well, I don't know if we'd really want to comment on what peak performance was with the terminal. It's been out of peak for some time now and given all the challenges that we've experienced over the last few years. So --

Brad Barron -- President and Chief Executive Officer

What I would add to that is, it seems there's a lot of questions about multiples and this happened when we sold Europe. There's a bunch of different ways to look at multiples. You're probably trying to dial into, OK, what was peak EBITDA multiple? What's the forward look? What's the current look? What's last year? What I want to reiterate is that we're very pleased with multiple from the sale. And what this allows us to do is to delever, like we said that we would, and it allows us to reinvest in some of our really high return projects here in North America.

So that's the takeaway from this.

Michael Blum -- Wells Fargo Securities -- Analyst

Great. Thank you.

Operator

Thank you. And I am showing no further questions from our phone lines. I'd now like to turn the conference back over to Pam Schmidt for any closing remarks.

Pam Schmidt -- Vice President of Investor Relations

Thank you, Crystal. We would once again like to thank everyone for joining us on the call today. If anyone has any additional questions, please feel free to contact NuStar Investor Relations. Thanks again and have a great day.

Operator

[Operator signoff] 

Duration: 39 minutes

Call participants:

Pam Schmidt -- Vice President of Investor Relations

Brad Barron -- President and Chief Executive Officer

Tom Shoaf -- Executive Vice President and Chief Financial Officer

Theresa Chen -- Barclays -- Analyst

Shneur Gershuni -- UBS -- Analyst

Jeremy Tonet -- J.P. Morgan -- Analyst

Ryan Levine -- Citi -- Analyst

Dennis Coleman -- Bank of America Merrill Lynch -- Analyst

Danny Oliver -- Senior Vice President, Marketing and Business Development

Sunil Sibal -- Seaport Global Securities -- Analyst

Selman Akyol -- Stifel Financial Corp. -- Analyst

Michael Blum -- Wells Fargo Securities -- Analyst

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