Tourists strolling the magnolia-shaded historic district of Fort Smith, Ark., spend a lot of time looking up at the neighborhood’s stunning Victorian mansions. Built around the turn of the previous century, the grand old houses reflect the city’s golden age of trade and industrialization as the 1800s became the 1900s.

Few visitors probably ever look down. But if they do, they’ll note a name stamped in the district’s worn but very serviceable concrete sidewalks at street corners: “Williams.”

Those sidewalks, laid 109 years ago, were the first step of a business journey that has taken The Williams Cos. Inc. to membership in the Standard & Poor’s 500 index and the Fortune 500. One of the biggest and oldest firms in the midstream sector, it ranks No. 6 in the current Midstream Business Midstream 50.

The company has crossed a lot of peaks and valleys in nearly 11 decades. Recent years have been especially challenging, given a called-off merger with Energy Transfer Equity LP, ranked No. 2 on the Midstream 50; differences between senior management, certain members of the board of directors and some investors; and an ambitious growth plan that has required many hours in Federal Energy Regulatory Commission (FERC) hearings and local town halls, answering environmentalists and an often incredulous public.

You might say Williams stumbled.

Williams' Willow Creek plant provides 500 million cubic feet of natural gas capacity to Piceance Basin producers in western Colorado. (Source: The Williams Cos.) Now, Williams has re-emerged as a leader in natural gas transmission with assets that span the nation, plus significant gathering and processing operations. It chose to bet big and develop major operations in the rapidly growing Appalachian Basin—emerging as a significant gas supply source—and in the Northeast—a promising gas demand market. A major sale earlier this year of its Geismar, La., petrochemical operations sharpened its focus on the long-term potential in gas gathering, processing and transmission.

Williams CEO Alan Armstrong believes the firm’s future, more than a hundred years out, is as bright as it has ever been. He took time to visit with Midstream Business in his office atop the firm’s towering Tulsa, Okla., headquarters to lay out his vision for what lies ahead.

MIDSTREAM You joined Williams in 1986, which was not a particularly good time to get in the energy business. But Williams has thrived through ups and downs since then. How does that background prepare the company for its future?

ARMSTRONG I started in January of 1986 and took a few days off to get married right after that. Then, six months later, the company was having a 10%, across-the-board layoff. So I thought for sure I would be looking for a new job. I would say that was my first introduction to the cycles in the energy space.

Yes, the company has been through a lot of ups and downs, but I would say what I have learned from that is the importance of maintaining a culture that treats employees with respect and dignity. There may be things you have to tell the employees they don’t like, but being honest and being genuine keeps people really wanting to do the right thing.

And I would say this: Last year, where we went through a really difficult time, where the board chose to approve a merger that went wrong, the employees really hung in there and continued to perform very well. In fact, we out-performed our peers last year from an EBITDA-growth standpoint.

This is a good example of when you treat people well, when you treat them fairly, they’ll hang in there for you. I would say I feel the same way about the company personally. I feel it’s always been fair to me and always been a place that has good values and is honest. That makes it easy to be passionate about your work.

MIDSTREAM You first visited with Midstream Business in early 2011 just after you were named CEO. What have you learned about the job in the six-plus years since then?

ARMSTRONG I would say it’s been a huge learning cycle on the things

I could have controlled better. One of the things we did is we made a big entrance into the Northeast and we had a lot of big, complicated projects going on in terms of trying to expand in multiple areas of the Northeast. And, at the same time, we were building out some big deepwater infrastructure in the Gulf of Mexico.

Probably my ambitions then were a little bit ahead of our organization’s capabilities when it came to building out big projects. But I would say that we were blessed during that period of time with some great opportunities for expansion on the backs of high margins and high oil prices.

But we probably needed to pay more attention to bringing our organizational capabilities up to speed and not out-running our headlights, so to speak. I would say that was one lesson I learned.

And, as well, I remember during that same time frame we were spinning off our E&P business [now WPX Energy Inc.], so we had a lot of big, complicated things going on across the organization. We had a lot on our plate.

And sometimes in the CEO seat it’s easy to have aspirations, but you have to follow those up with the organizational capabilities. But, having said that, we have an exceptional employee base and I am extremely confident in their abilities.

MIDSTREAM The Energy Transfer situation seems to be history at this point. How did Williams change as a result?

ARMSTRONG It was certainly painful for the organization, [mostly because] I think while the company and management talks about culture and the value of culture a lot, that the alignment of cultures should be a key consideration in these types of discussions.

I would say that company culture is a foundation that employees probably rely on. They probably were looking at in terms of being very focused on operational details, and he is a real champion of continuous improvement and operational excellence. And that is something that, given all the distractions we’ve had at the top of the house, didn’t get the kind of focus we needed. We didn’t make the kind of progress I would have liked to have seen us make during the merger and with the efforts to establish the great board of directors we have today.

He’s really in a great position to constantly work on continuous improvement. You can’t just kind of start and stop repeatedly. He has a full-time job and is really focused on continuous improvement of the company. He has a super passion for it. In addition to that, he’s had a lot of experience on major projects and has done very well in his career with them, so he’s got a lot of good ideas he’s bringing to the table for us on executing major projects.

MIDSTREAM Williams’ strategic focus is on natural gas, a product with multiple and growing markets. Where at the cultural change that was out in front of us and wondering how it might work. Depending on the perspective one brings to a discussion, that can impact the importance some people might place on culture.

MIDSTREAM Micheal Dunn, who was president of Questar Pipeline LLC and executive vice president of Questar Corp., recently joined your executive suite as COO. What will be his role in directing the company?

ARMSTRONG It’s really exciting to have Micheal up here. Of course, he already had 14 years with the company, since he started with Williams early in his career. When we sold off Kern River Gas Transmission to Berkshire Hathaway he went with them, then went on to Berkshire Hathaway’s PacifiCorp Energy when they asked him to take the head job there. From there, he went to Questar.

I’ve known Micheal, really, throughout his career. I’ve always been very impressed with him as an executive.

ARMSTRONG Certainly, the demand side right now is building out pretty rapidly, and we’re blessed to have a pipeline like Transco so well positioned, and Northwest Pipeline is an emerging opportunity as well. We just happen to be in all the right spots for the demand side.

On the supply side, you know, we started poking around in the Marcellus and Utica back in 2009 and 2010 when our E&P company at the time, now WPX, was doing some exploration

up there.

And we really liked what we saw. We thought, “Wow! This could be a huge driver for Transco.”

The challenge we had on Transco—a lot of people don’t remember now—was we had plenty of growing markets but we didn’t have a way of getting all that gas up there inexpensively. So, lo and behold, the Marcellus and Utica came in, and now we had two sources of sup-ply coming onto this big header from both the north and the south. In effect, it gave us a huge boost in our ability to build capacity for all of the Transco sys-tem. That’s where we sit today.

I think you’re going to continue to see us building out the demand side and connecting it to the low-cost sup-ply. It’s a pretty interesting dilemma right now that the natural-gas space has. Because, on the one side you have all these people saying, “Gosh, we’re never going be able to get to a decent price on natural gas” as though that’s a bad thing. Because I would tell you, continuing to have a predictable, low-cost fuel is just going to continue to develop demand for that fuel.

The worst thing that could happen right now, I think for us, would be

to have a spike in gas prices because

it would shake the confidence that is developing in all of these big markets—whether it’s LNG, or power generation, methanol production, urea production, you name it.

Natural gas here in the U.S., being so low-cost, is one of our greatest promises right now. And from a Williams perspective, we are thrilled to see the moderate and low volatility that we have right now in natural gas because we think it’s going to continue to build demand.

MIDSTREAM Williams has emerged as the largest gas gatherer in the Marcellus and Utica. Could you discuss additional growth opportunities you see there?

ARMSTRONG You know, right now the big growth is going to come on the heels of pipeline takeaway capacity. That’s really all we’re missing up there. So our business is positioned very well to take advantage of the pipeline takeaway capacity, no matter whose it is. We’ve really got our big footprint already established. So for us, we’ve got a lot of growth that’s just going to come on the backs of new pipeline takeaway capacity.

Said another way, we have all the big trunk lines, established from the gathering system. We have the big footprints or our plants and our compression stations, and those are expensive.

And in the Northeast, because the terrain is so difficult up there and land is relatively precious compared to places like Wyoming, Texas or Oklahoma, getting that footprint established is a big deal. Now, as the pipeline capacity comes on, our systems are going to naturally grow.

There may not be a lot of new step-out because frankly, we’ve already got our footprint pretty well established.

MIDSTREAM What will bring

a breakthrough in adding pipeline capacity to the Northeast?

ARMSTRONG Certainly, I would say there are areas right now that are poised for that. One is in Ohio and the Utica—the dry gas Utica. That is going to be driven by Rover [Pipeline] coming on. Then, in the Northeast, Pennsylvania: That is going to be driven by Transco’s Atlantic Sunrise project coming on.

And I think working with both the federal government and the state governments to streamline permitting processes will continue to enable the infrastructure to get built. That’s one of the focuses we have now, to try to work with the new administration on pipeline permitting and dealing with its complexity.

MIDSTREAM Outside Appalachia, Williams has a significant presence in the Gulf of Mexico and Western U.S. What opportunities do you target in those markets?

ARMSTRONG First of all, along the Gulf, there are a lot of big LNG projects. The U.S. has six projects that have gone past investment decisions on the LNG front right now. We have major, firm-supply agreements with four of those plants.

I feel pretty good about that. Part of this is because Transco runs along the coast—one. And, two, it has connecions to gas supplies in the Northeast. If you’re an LNG supplier or buyer of LNG, you want to have connections back to those resources. That’s a pretty big driver.

We also have a pretty significant fertilizer plant that’s being looked at in St. James Parish [La.] as well. So we’ve got both industrial load and LNG load on the Gulf Coast that is picking up.

MIDSTREAM Your Transco sys-tem has received a significant share of Williams’ recent capex. What work has been done and what remains to be done?

ARMSTRONG In 2010, our firm contract capacity on Transco was 8.9 billion cubic feet per day [Bcf/d] and now—already on the books, this isn’t speculating on growth—we have 17.7 Bcf/d contracted through 2018. We have almost doubled the capacity on Transco in terms of full contracting capacity.

Again, that is not speculation on our part. We are continuing to see growth. We have over $5 billion of investment capital right now that we’re executing on Transco and we’ve got about another 20 projects that are in the development stage on Transco beyond that. So the hits just keep com-ing on Transco. It’s everything from taking out fuel oil as a heating source in the Northeast, to power generation in the mid-Atlantic and the South, to LNG on the Gulf Coast.

MIDSTREAM Adding new pipeline capacity in the Northeast has been a challenge for all of the sector, yet

Williams has had some successes in the region, such as your line added last year serving Long Island. What are you doing differently to build public support?

ARMSTRONG We are really trying to not operate with an iron fist. We really are trying to listen to community issues and not only seem responsive, but be responsive.

Williams is a long-term story and is going to continue to be.

So, for instance, in terms of get-ting that Long Island installation at Rockaway Beach, we crossed a national park [Gateway National Recreation Area]. And, in order to get that permit, we agreed to replace and update the hangars there at the old, historic Floyd Bennett Air Field.

One thing I’m really proud of here is, just recently, we had a big landowner on Atlantic Sunrise named Geraldine Nesbitt. If you look in the filings you’ll see [the land] referred to as the Nesbitt tract. She initially had been supportive of the project. But some opposition teams came in and started finding rea-sons why she didn’t want the pipeline on her property. And the route around hat property has about 40 different landowners that we needed—so work with one landowner vs. 40 landowners.

There were some concerns about tribal artifacts on the property. We felt like we had done the proper studies and were very comfortable that we weren’t impacting them. We had hired third-party tribal consultants to come in and study the issue. Anyway, opposition was clearly raising new concerns.

So, rather than spending our time beating our head against the wall, the team very quickly went and found a reroute with landowners who were willing to have the right-of-way on their property. So we rerouted around the Nesbitt tract.

As a result of that, there was a hearing process concluded at FERC recently and … many different interveners … filed including Ms. Nesbitt, including the tribes that thought they were going to be impacted. All filed in support of the reroute and of the company.

Rather than fighting the path that we had taken, we actually gained their sup-port for the reroute, so that was positive.

Just another item: I think I presented at the Scotia Howard Weil energy conference earlier this year about the situation in Georgia where we went in and found a way to work with the U.S. and state fish and wildlife services to actually find a more impactful way to help out the endangered bat species in the area that we were going impact. I think we are trying to do the right things, not with an iron fist and not in the kind of way energy companies sometimes are perceived.

We really are trying to look for creative solutions and build allies in the process that support us. That comes off very differently.

MIDSTREAM Your new Gulf Trace system serves Cheniere’s LNG plant that has projected increasing export business as it brings on new liquefaction trains. Do you see Cheniere and other LNG exporters as a growing market for Williams?

ARMSTRONG Yes, we definitely view LNG exports as the fastest and largest demand growth element in North America. Transco is uniquely positioned to be a supplier to many of these terminals that are currently being built.

We also have 22 Bcf/d worth of inter-connects that third parties have paid for on our system. In other words, those are people coming to us either wanting a connection into or out of our pipeline.

I think what that tells you is that Transco has really become the market if you’re a buyer of gas. You want to be connected if you’re in LNG.

These are just paid-for interconnects that people come and pay us for, but they don’t want firm capacity; they didn’t come for that. Transco has really become kind of the marketplace if you want to move natural gas all the way from Corpus Christi [Texas] to New York. It’s a point of high liquidity and a place you want to be if you’ve got either a need for incremental gas in the future or if you have gas supplies that you want to make sure you have a good market for.

MIDSTREAM Williams had a strong first quarter, although it narrowly missed some analysts’ projections. Where do you feel you stand on your 2017 plan at midyear?

ARMSTRONG Just to clarify, we did just barely beat the numbers. But, you know, there are a lot of different consensus numbers you see out there. We did beat the recognized consensus number, literally by, I think, $3 million or $4 million. So it was a pretty tight margin.

There were not a lot of big catalysts, just a lot of continued growth in the business and a really solid underpinning. That was great. It’s nice to have an investor base that’s more focused on the long-term fundamentals and not so many short-term investors just looking for catalysts here and there. Williams is a long-term story and is going to continue to be.

We feel really good right now for 2017. We have five major [expansion] projects coming on this year; one of those is Gulf Trace. The other ones are Dalton and Hillabee Phase I—there are two phases. Also, Transco’s New York Bay and Virginia Southside II.

We’re certainly going all-in gas. Not necessarily any particular basin, but we certainly are highly focused on natural gas.

Those projects are all on schedule and doing well despite some pretty stiff opposition on New York Bay and also on Garden State [expansion], which has commenced construction and will be in service next year, so the team has done a great job getting those moving ahead.

Of course, we did very well on our sale of Geismar. I think Wall Street was expecting between $1.5 billion and $1.7 billion. When closed, we will raise $2.1 billion on that sale. Overall, things are going very well this year.

MIDSTREAM Please discuss your recent Permian-for-Marcellus asset deal. How will that impact future growth plans?

ARMSTRONG We traded out of a Delaware Basin joint venture. Western Gas [Partners LP] was the operator.

They had other assets in the area that were 100% owned that wound up being competitive with our joint venture. We really didn’t like the way our interest was positioned there, where you had the operating partner owning 100% of the midstream and they also had their own E&P operations. [Anadarko Petroleum Corp. is Western’s parent.]

Then, they had our assets that they owned half of—and we’ve seen that movie before. In addition to that, the asset wasn’t going to generate free cash flow for probably over five years because there was so much capital investment to put into it.

On the Marcellus, Bradford County [Pa.], side—the largest single gathering system that we own and, I suspect, in terms of volumes right now is the largest independent gathering system—we are gathering about 2.7 Bcf/d. Most of the capital has already been spent on that system and so it really is in a mode of generating high levels of free cash flow.

So the deal fit us in terms of our financial needs of continued deleveraging by increasing EBITDA for this year and benefited Anadarko, given [its] positions. What we were trading off was potential free cash flow growth in the Permian five to 10 years down the road.

MIDSTREAM Do you see additional asset sales or acquisitions in your immediate future? Do you look to acquire or to grow internally?

ARMSTRONG I think today, because we have so many investment opportunities right within our fair-way of opportunity, that you’ll see us sticking more to internally generated opportunities. There will be some bolt-ons like there always are. There will be some things that are a refinement of our portfolio, like Bradford County—like the Marcellus-for-Permian trade that we did.

Overall, it’s pretty hard for us to beat internal development right now, just because we’re making such high returns on the Transco expansion opportunities.

MIDSTREAM You noted in recent analyst meetings that the sale of the Geismar plant further lessened Williams’ exposure to commodity prices. But underlying the fee-based revenue model, your customers retain commodity price exposure that can result in lower volumes. How do you manage that risk?

ARMSTRONG That’s a great question. First of all, if you think about how we’ve positioned ourselves today, where we’re handling a little over 30% of the nation’s natural gas volumes, the volumes in the natural gas space are going to flow one way or the other.

So, said another way, it is unlike oil. Oil is going be dependent on how prices are around the world, whether OPEC cuts or doesn’t cut production. On the other hand, natural gas s a pure market here in the U.S. that is driven by how low prices are.

The lower the price is for natural gas, the more long-term volume there will be. It’s not like the demand is not going to be met by U.S. production as we sit here today. The U.S. is the low-cost provider for natural gas among the established industrial countries.

And because our systems are so spread out across so many of the different basins, there are not very many places that gas is going to get developed that we don’t enjoy an upside.

It might come in the Utica instead of the Marcellus or it might come in the Haynesville instead of the Utica. But, at the end of the day, we have such a large position in what we think are the key natural gas basins that it’s pretty hard to make a case that we’re not going enjoy it.

The question is where we’re going to enjoy, not if we’re going to enjoy, a volume upside.

Again, we’re actually a fan of fairly moderate gas prices. And we’re very confident in the independent producers continuing to be able to lower the price of getting gas out of the market opportunity.

MIDSTREAM What do you see as Williams’ greatest advantage?

ARMSTRONG You know, I would say, while a lot of people look at us and say, “Gosh, you guys have great assets,” we didn’t just accidentally get them. We’ve got great assets because we’ve had a strategy that we’ve stuck with for a long period of time.

And so I would say, from my vantage point, our ability to focus on the long term and especially with the new board of directors that we have, I think we’re blessed with a long-term and fundamental vantage point at the board level now that allows us to really take advantage of the strategy that we have.

And I think, certainly, the employee base I mentioned earlier is an asset. We have a very loyal and dedicated employee base here that really strives to make the company better every day.

MIDSTREAM In your opinion, where will the midstream be in five years?

ARMSTRONG I think that people are distinguishing their bets. There are some people that are going all-in Permian. We’re certainly going all-in gas. Not necessarily any particular basin, but we certainly are highly focused on natural gas. And I think the people who have positioned themselves for the long term based on fundamentals, not just chasing the latest fad, will be the ones who will be successful over this time horizon.

I think, if you are considering mid-stream companies either as a career or as an investor, you really have to think about the companies’ long-term prospects. I think Williams is as strong as we have ever been in terms of capabilities right now. I’m really excited about developing our capabilities further. We are really making strides. I’m really excited about Micheal Dunn helping us out.

We have emerged from the merger termination, where people had a lot

of gloom and doom from some in the investor base, to today, where recently we’ve led the pack over the trailing 12 months’ stock-price gain including Energy Transfer.

I’ll just say I’m glad to see Williams back on its feet.