Thanks to rising gas and NGL prices, and a boost from its Bakken assets, Targa Resources reported solid first-quarter earnings, despite a confusing political environment and some hostile winter weather.
“We have spent the last many years positioning Targa to be successful across changing environments and to be a beneficiary of market volatility and are proud of our execution across the first four months of the year,” said Matt Meloy, Targa CEO, during the company’s May 5 first-quarter earnings call.
The company reported a record EBITDA of $1.2 billion for the quarter, 22% higher than first-quarter 2024, and adjusted free cash flow from operations of $970 million, 31% higher than last year.
Meloy said several winter events curbed the volume Targa was able to ship over its network. However, the company recorded overall volume increases in crude, natural gas and NGL through capacity expansions over the last year.
Targa saw a higher operating margin in the Permian Basin, where natural gas volumes into the company’s processing plants increased. Targa has opened three gas processing plants in the region since 2025 and has five more plants set to open across the basin by third-quarter 2026.
Up north, Targa made a purchase in the Bakken that also added to the company’s bottom line. In February, Targa bought back the $1.8 billion in equity in Targa Badlands from funds managed by Blackstone, taking full control of the North Dakota assets after selling in 2019.
Targa’s Badlands operations include 500 miles of crude and 300 miles of natural gas gathering pipelines. Crude sales from the region were up 13% from 2024 to 107,100 bbl/d.
For the rest of the year, the company has kept its projected EBITDA in the range of $4.65 billion to $4.85 billion, despite potential cost increases and demand threats brought on by the current tariff situation.
“We see a low-single-digit percentage potential impact to budgeted project costs across our announced projects underway, which would fit well within our contingency for our projects,” said Jen Kneale, Targa president.
The company also believes it can continue to leverage earnings out of its “wellhead-to-water” NGL system out of the Permian, as the basin continues to increase the volumes of produced gas.
Kneale said Targa, along with most energy companies, are keeping a close eye on the tariff situation.
“We’re, of course, in the midst of a lot of conversations with our producers as we consistently are,” she said. “What we’re hearing so far is that we’ve got producers with multi-year drilling programs in place, and we expect there to be significant resiliency.”