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Targa Resources surpasses profit expectations on record gas volume and boosts share purchase program

Targa Resources, a pipeline operator, beat its second-quarter adjusted core profits estimates due to record volumes of natural gases and natural gas liquids transported by its system.

In addition to the $1 billion previously announced, the company has also announced a $1.0 billion new share repurchase plan.

In premarket trading, shares were up 2.6% to $167.32.

The demand for natural gas is on the rise, fueled by data centers that are energy hungry and an increase in domestic consumption. This has helped firms such as Targa who transport natural gas.

The U.S. Energy Information Administration announced in April that the U.S. electricity consumption would reach new records between 2025 and 26 due to the rise of cryptocurrency and AI-focused data centers.

The company's quarterly Permian gas inlet volume rose by about 11%, to a new record of 6.28 billion cubic foot per day, compared to the previous year. Meanwhile, NGL pipeline transport volumes also increased by about 23%, to a new record of 961,200 barges per day.

According to LSEG, the Houston-based company saw its core adjusted profit rise 18% from a year ago to $1.16 Billion for the quarter ending June 30. This was higher than analysts' estimates of $1.14 Billion.

The total revenue increased by 20%, to $4.26 Billion, mainly due to higher NGL volumes, natural gas prices and lower NGL prices.

Targa provides natural gas and NGLs through its network across the Permian basin, Eagle Ford Shale, Bakken Shale, and other major U.S. Oil and Gas regions.

The company transports and fractionates NGLs to produce products such as ethane and propane. (Reporting and editing by Vijay Kishore; Khusbu Jena)

(source: Reuters)