NAPTP Presentation
Barry Davis,
President & CEO
May 21, 2014
1
Strong. Innovative. Growing.
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of the federal securit...
Non-GAAP Financial Information
This presentation contains non-generally accepted accounting principle financial measures t...
EnLink Midstream Partners, LP
Master Limited Partnership
NYSE: ENLK
(BBB / Baa3)
EnLink Midstream, LLC
General Partner
NYS...
Gathering System
Processing Plant
Fractionation Facility
North Texas Systems
Louisiana Gas System
Louisiana NGL System
Caj...
The Vehicle for Sustainable Growth:
Diverse, Fee-Based Cash Flows
 Devon is EnLink Midstream’s largest customer
(>50% of ...
7
Each of EnLink Midstream’s segments benefits from the stability provided by long-term, fee-based contracts
Segment / Key...
Management Team Experience
Barry Davis
President & CEO
Barry Davis is President and Chief Executive Officer of EnLink Mids...
The Four Avenues for
Growth
9
 Near-term focus on
platform expansion
opportunities
 Longer-term focus on
pursuing scale
positions in new
basins, espec...
Avenue 1: Future Dropdowns
Devon Sponsorship Creates Dropdown Opportunities
11
2014 2015 2016 2017
Devon Sponsorship Provi...
Note: Capital spend figures exclude capitalized G&A and interest, midstream and other corporate capital. For 2014, this re...
Avenue 3: Organic Growth
Significant Organic Growth Projects
Already Underway
13
South Louisiana
Platform Expansion
• Focu...
Organic Growth Project
Cajun-Sibon Expansion
 258 miles of NGL pipeline from Mont Belvieu area to NGL fractionation asset...
Organic Growth Project
Bearkat Processing & Gathering System
 Builds on success of Deadwood joint
venture with Apache, wh...
Avenue 4: Mergers & Acquisitions
 Near-term focus on platform expansion opportunities
 Longer-term focus on pursuing sca...
EnLink Midstream Today & Tomorrow
EnLink Midstream
Today
EnLink Midstream
Potential Future in 2017
17
South Louisiana
Grow...
Financial Outlook
18
Sustainable
Growth
Substantial
Scale &
Scope
Diverse,
Fee-Based
Cash Flow
Strong B/S
Credit Profile
19
• Investment grade ...
Appendix:
Detailed Asset
Overview
20
North Texas Assets
Positioned for Long-Term Performance
Gathering
 3,640 miles of pipeline
 2,600 MMcf/d capacity
Proces...
Permian Assets:
A Platform in a Prolific Basin
Gathering
 65 miles of pipeline under
construction
 65 miles of fuel and ...
Oklahoma Assets:
Solid Platform for Bolt-On Projects
Cana
 Gathering
• 410 miles of pipeline
• 530 MMcf/d capacity
 Proc...
Louisiana Assets:
Growing Gulf Coast Capabilities
Crude Handling
 2 terminals
 ~18 MBbl/d capacity
Natural Gas
Transport...
Ohio River Valley Assets:
Established History of Service
Crude/Condensate Transportation
 200 miles of crude pipeline, 17...
Howard Energy Investment:
Strategic South Texas Asset Footprint
26
 Howard Energy Partners (“HEP”) is a high growth midst...
of 26

Naptp presentation final

Published on: Mar 3, 2016
Published in: Investor Relations      Business      
Source: www.slideshare.net


Transcripts - Naptp presentation final

  • 1. NAPTP Presentation Barry Davis, President & CEO May 21, 2014 1 Strong. Innovative. Growing.
  • 2. Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. The future results of EnLink Midstream, LLC, EnLink Midstream Partners, LP and their respective affiliates (collectively known as “EnLink Midstream”) may differ materially from those expressed in the forward-looking statements contained throughout this presentation and in documents filed with the Securities and Exchange Commission (“SEC”). Many of the factors that will determine these results are beyond EnLink Midstream’s ability to control or predict. These statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, drilling levels; the dependence on Devon Energy Corporation for a substantial portion of the natural gas that EnLink Midstream gathers, processes and transports; the risk that EnLink Midstream will not be integrated successfully or that such integration will take longer than anticipated; the possibility that expected synergies will not be realized, or will not be realized within the expected timeframe; EnLink Midstream’s lack of asset diversification; EnLink Midstream’s vulnerability to having a significant portion of its operations concentrated in the Barnett Shale; the amount of hydrocarbons transported in EnLink Midstream’s gathering and transmission lines and the level of its processing and fractionation operations; fluctuations in oil, natural gas and natural gas liquids (NGL) prices; construction risks in its major development projects; its ability to consummate future acquisitions, successfully integrate any acquired businesses, realize any cost savings and other synergies from any acquisition; changes in the availability and cost of capital; competitive conditions in EnLink Midstream’s industry and their impact on its ability to connect hydrocarbon supplies to its assets; operating hazards, natural disasters, weather-related delays, casualty losses and other matters beyond its control; and the effects of existing and future laws and governmental regulations, including environmental and climate change requirements and other uncertainties and other factors discussed in EnLink Midstream’s Annual Reports on Form 10-K for the year ended December 31, 2013, and in EnLink Midstream’s other filings with the SEC. You are cautioned not to put undue reliance on any forward-looking statement. EnLink Midstream has no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 2
  • 3. Non-GAAP Financial Information This presentation contains non-generally accepted accounting principle financial measures that EnLink Midstream refers to as adjusted EBITDA, gross operating margin and segment cash flows. Adjusted EBITDA is defined as net income plus interest expense, provision for income taxes, depreciation and amortization expense, stock-based compensation, (gain) loss on noncash derivatives, transaction costs, distribution of equity investment and non-controlling interest; and income (loss) on equity investment. Gross operating margin is defined as revenue less the cost of purchased gas, NGLs, condensate and crude oil. Segment cash flows is defined as revenue less the cost of purchased gas, NGLs, condensate, crude oil and operating and maintenance expenditures. The amounts included in the calculation of these measures are computed in accordance with generally accepted accounting principles (GAAP) with the exception of maintenance capital expenditures. EnLink Midstream believes these measures are useful to investors because they may provide users of this financial information with meaningful comparisons between current results and prior-reported results and a meaningful measure of EnLink Midstream’s cash flow after it has satisfied the capital and related requirements of its operations. Adjusted EBITDA, segment cash flows and gross operating margin, as defined above, are not measures of financial performance or liquidity under GAAP. They should not be considered in isolation or as an indicator of EnLink Midstream’s performance. Furthermore, they should not be seen as measures of liquidity or a substitute for metrics prepared in accordance with GAAP. 3
  • 4. EnLink Midstream Partners, LP Master Limited Partnership NYSE: ENLK (BBB / Baa3) EnLink Midstream, LLC General Partner NYSE: ENLC Public Unitholders ~70% ~30% ~1% GP ~7% LP EnLink Midstream Holdings (formerly Devon Midstream Holdings) ~52% LP ~40% LP 50% LP Devon Energy Corp. NYSE: DVN (BBB+ / Baa1) GP + 50% LP The Vehicle for Sustainable Growth: MLP Structure with a Premier Sponsor 4 Dist./Q Split Level < $0.2500 2% / 98% < $0.3125 15% / 85% < $0.3750 25% / 75% > $0.3750 50% / 50% Current Position ENLC owns 100% of IDRs ~50% LP
  • 5. Gathering System Processing Plant Fractionation Facility North Texas Systems Louisiana Gas System Louisiana NGL System Cajun-Sibon Expansion Howard Energy Ohio River Valley Pipeline Storage Crude & Brine Truck Station Brine Disposal Well Barge Terminal Rail Terminal Condensate Stabilizers (1) Increasing to 7 facilities with 252,000 Bbl/d of total net capacity upon completion of the Cajun-Sibon phase II expansion expected in the second half of 2014. AUSTIN CHALK EAGLE FORD PERMIAN BASIN CANA-WOODFORD ARKOMA- WOODFORD BARNETT SHALE HAYNESVILLE & COTTON VALLEY UTICA MARCELLUS LA TX OK OH WV PA The Vehicle for Sustainable Growth: Strategically Located and Complementary Assets Gas Gathering and Transportation  ~7,300 miles of gathering and transmission lines Gas Processing  12 plants with 3.3 Bcf/d of total net inlet capacity  1 plant with 60 MMcf/d of net inlet capacity under construction NGL Transportation, Fractionation and Storage  ~570 miles of liquids transport line  6 fractionation facilities with 180,000 Bbl/d of total net capacity(1)  3 MMBbl of underground NGL storage Crude, Condensate and Brine Handling  200 miles of crude oil pipeline  Barge and rail terminals  500,000 Bbl of above ground storage  100 vehicle trucking fleet  8 Brine disposal wells 5
  • 6. The Vehicle for Sustainable Growth: Diverse, Fee-Based Cash Flows  Devon is EnLink Midstream’s largest customer (>50% of consolidated 2014E adjusted EBITDA*)  EnLink Midstream’s growth projects focused on crude/NGL services and rich gas processing  Strong emphasis on fee-based contracts 2014E EnLink Midstream Consolidated Gross Operating Margin* 95% 5% By Contract Type Texas 57% 19% Ohio 5% Okla. 19% By Region 56% Devon 44% Other By Customer Fee-Based Commodity Sensitive * Gross operating margin and adjusted EBITDA percentage estimates are provided for illustrative purposes and reflect period following transaction closing (2Q-4Q 2014). Note: Adjusted EBITDA and gross operating margin are non-GAAP financial measures and are explained on page 3. Louisiana 6
  • 7. 7 Each of EnLink Midstream’s segments benefits from the stability provided by long-term, fee-based contracts Segment / Key Contract % of Q4 2014 Segment Cash Flow Texas New Devon Bridgeport Contract - 10 years with 5 year MVC 85% New Devon East Johnson County Contract - 10 years with 5 year MVC Existing FT Transmission & Gathering - Volume Commitments with remaining terms of 2-10 years Apache Deadwood Plant - Dedicated interest with 8.5 years remaining on 10 year term Bearkat Plant - Volume Commitment with 10 year term from initial flow Oklahoma New Devon Cana Contract - 10 years with 5 year MVC 100% New Devon Northridge Contract - 10 years with 5 year MVC Louisiana North LIG Firm Transport - Reservation fee with avg remaining life of 4 years 70% Firm Treating & Processing - Remaining term minimum 2 years Cajun-Sibon Phases I & II - 5 & 10 year agreements for supply and sale of key products ORV E2 Compression / Stabilization Contract - 7 years ~30% % of Total Segment Cash Flow in Q4 2014 ~80% Note: Segment cash flow is a non-GAAP financial measure and is explained in greater detail on page 3. The Vehicle for Sustainable Growth: Stable & Diversified Cash Flows
  • 8. Management Team Experience Barry Davis President & CEO Barry Davis is President and Chief Executive Officer of EnLink Midstream. Mr. Davis led the founding of Crosstex Energy in 1996 prior to the initial public offerings of Crosstex Energy, L.P. in 2002 and Crosstex Energy, Inc. in 2004. Under his leadership, Crosstex evolved into a significant service provider in the energy industry’s midstream business sector. Joe Davis EVP & General Counsel Joe Davis is Executive Vice President and General Counsel of EnLink Midstream. Mr. Davis joined Crosstex Energy in 2005 after serving as a partner at Hunton & Williams, an international law firm, where he also was a member of the executive committee. Mr. Davis began his legal career at Worsham Forsythe, which merged with Hunton & Williams in 2001. Michael Garberding EVP & CFO Michael Garberding is Executive Vice President and Chief Financial Officer of EnLink Midstream. Previously, Mr. Garberding held various positions at Crosstex Energy, including Executive Vice President and Chief Financial Officer, and Senior Vice President of Business Development and Finance. Prior to joining Crosstex in 2008, Mr. Garberding was assistant treasurer at TXU Corp. where he focused on structured transactions such as project financing for coal plant development and the sale of TXU Gas Company. Steve Hoppe EVP & President of Gas Gathering, Processing and Transportation Steve Hoppe is Executive Vice President and President of the Gathering, Processing and Transportation Business of EnLink Midstream. Mr. Hoppe previously served as Vice President of Midstream Operations for Devon, which he joined in 2007. Prior to joining Devon, Mr. Hoppe spent eight years at Thunder Creek Gas Services, most recently serving as president. EnLink Midstream management team is comprised of former Crosstex and Devon senior management and other experienced midstream leaders McMillan (Mac) Hummel EVP & President of NGL and Crude Oil Mac Hummel is Executive Vice President and President of the Natural Gas Liquids and Crude Business of EnLink Midstream. Mr. Hummel previously served as Vice President of Commodity Services at Williams Companies Inc. since 2013, and prior to that he served as Vice President, NGLs & Olefins at Williams from 2010 to 2012. Mr. Hummel worked at Williams for 29 years. The Leadership: Experienced Management Team with a Proven Track Record 8
  • 9. The Four Avenues for Growth 9
  • 10.  Near-term focus on platform expansion opportunities  Longer-term focus on pursuing scale positions in new basins, especially in areas where Devon is active  South Louisiana Liquids Expansions – Cajun-Sibon  West Texas Gas Expansions – Bearkat  Other focused areas for growth  Potential Areas where Devon Needs Infrastructure ̶ Eagle Ford ̶ Permian Basin ̶ Oklahoma ̶ New Basins Destination 2017: The Four Avenues for Growth 10  E2 dropdown  Dropdown of legacy Devon midstream assets at ENLC  Potential Access Pipeline dropdown  Potential Eagle Ford Victoria Express Pipeline dropdown Dropdown Opportunities Growing With Devon Organic Growth Projects Mergers & Acquisitions AVENUE 1 AVENUE 2 AVENUE 3 AVENUE 4
  • 11. Avenue 1: Future Dropdowns Devon Sponsorship Creates Dropdown Opportunities 11 2014 2015 2016 2017 Devon Sponsorship Provides Potential for ~$375 MM of Cash Flow from Dropdowns Other Potential Devon Dropdowns E2 Legacy Devon Midstream Assets Access Pipeline Victoria Express Pipeline Cautionary Note: The information on this slide is for illustrative purposes only. No agreements or understandings exist regarding the terms of these potential dropdowns, and Devon is not obligated to sell or contribute any of these assets to EnLink. The completion of any future dropdown will be subject to a number of conditions. The capital and acquisition cost information on this slide is based on management’s current estimates and current market information and is subject to change. Estimated Capital Cost: $80 MM Estimated Cash Flow: ~$12 MM Estimated Capital Cost: $1.0 B Estimated Cash Flow: ~$150 MM Acquisition Cost: $2.4 B Estimated Cash Flow: ~$200 MM Estimated Capital Cost: $70 MM Estimated Cash Flow: ~$12 MM
  • 12. Note: Capital spend figures exclude capitalized G&A and interest, midstream and other corporate capital. For 2014, this represents approximately $1.4 billion. Devon 2014 E&P Capital Budget $5.0 - 5.4 Billion Avenue 2: Growing With Devon Serving Devon’s Needs is a Priority  Devon has significant financial incentive to contract midstream development with EnLink ̶ 70% ownership of ENLC, 52% ownership of ENLK ̶ Once EnLink enters the 50% level of the splits, approximately $0.60 of each incremental $1.00 distributed by EnLink goes to Devon  Devon has historically spent $350-$700 MM annually on midstream capital expenditures 28% 21%21% 7% 5% 11% 2% 5% Permian Basin Eagle Ford Heavy Oil Anadarko Basin Barnett Shale Emerging Oil Other Non-Core Assets $0 $100 $200 $300 $400 $500 $600 $700 $800 2011 2012 2013 2014E Devon Historical Midstream Capital Expenditures ($MM) 12
  • 13. Avenue 3: Organic Growth Significant Organic Growth Projects Already Underway 13 South Louisiana Platform Expansion • Focused on bolt-on expansions around premier South Louisiana liquids position • Cajun-Sibon expansion expected to be operational in 2014 • Increasing utilization of existing NGL asset base West Texas Platform Expansion 3rd Party Growth Around Legacy Devon Midstream Assets • Significant bolt-on expansion opportunities around Cana-Woodford and Barnett Shale assets • Commercial teams currently in discussions with various potential producers Develop Canadian Oil Sands Presence • Access Pipeline creates platform for significant growth in Alberta Canada • Will have commercial teams looking at additional expansions and services • Focused on providing associated gas processing and high pressure gathering services • Bearkat plant and high pressure gathering pipelines expected to be complete in 2014 • Excess pipeline capacity opportunity for continued growth
  • 14. Organic Growth Project Cajun-Sibon Expansion  258 miles of NGL pipeline from Mont Belvieu area to NGL fractionation assets in south Louisiana (195 miles new, 63 miles re-purposed)  140 MBbl/d south Louisiana fractionation expansion  Phase I completed fourth quarter 2013; Phase II projected completion in fourth quarter 2014  Expected run-rate adjusted EBITDA of Phase I and Phase II ~$115 MM 14 Note: Adjusted EBITDA is a non-GAAP financial measure and is explained in greater detail on page 3.
  • 15. Organic Growth Project Bearkat Processing & Gathering System  Builds on success of Deadwood joint venture with Apache, which was on-time, on-budget and is near full capacity  ~ 60 MMcf/d processing plant  ~65-mi., 12” gathering system with combined capacity of 200,000 Mscf/d  ~65-mi., 6” lean gas fuel line – providing producer fuel and gas lift  Supported by long-term, fee-based contracts with multiple producers  Completion expected in second half of 2014 15
  • 16. Avenue 4: Mergers & Acquisitions  Near-term focus on platform expansion opportunities  Longer-term focus on pursuing scale positions in new basins, especially in areas where Devon is active  Superior financing capabilities already in place at ENLK ̶ Low cost of capital with investment grade balance sheet (BBB / Baa3) ̶ Significant flexibility with approximately $1.0 billion of liquidity  Potential to pursue strategic acquisitions jointly with Devon 16
  • 17. EnLink Midstream Today & Tomorrow EnLink Midstream Today EnLink Midstream Potential Future in 2017 17 South Louisiana Growth: Cajun-Sibon West Texas Growth: Bearkat Victoria Express Dropdown Complete E2 Dropdown Complete Other Potential Step Changes Other Growth Factors • Growth from Serving Devon • Mergers & Acquisitions Potential for $375 MM of Additional Cash Flows from dropdowns Heavy Oil Access Pipeline Dropdown Complete CANADIAN OIL SANDS Significant Organic Growth Projects Underway Midstream Holdings Dropdown Complete
  • 18. Financial Outlook 18
  • 19. Sustainable Growth Substantial Scale & Scope Diverse, Fee-Based Cash Flow Strong B/S Credit Profile 19 • Investment grade balance sheet at ENLK (BBB, Baa3) • Debt/EBITDA of ~3.5x • ~$1.0 billion in liquidity at ENLK • ~ 95% fee-based margin • Projects focused on crude/NGL services and rich gas processing • Balanced cash flow (Devon ~50%) • Total consolidated enterprise value of ~$14 billion • Projected 2014 Adjusted EBITDA: $675 million • Geographically diverse assets with presence in major US shale plays • Stable base cash flow supported by long-term contracts • Organic growth opportunities through Devon’s upstream portfolio • Potential additional cash flow from dropdowns: ~$375 million Louisiana ORV Long Term Vision: EnLink’s Key Financial Attributes Note: Adjusted EBITDA is a non-GAAP financial measure and is explained in greater detail on page 3.
  • 20. Appendix: Detailed Asset Overview 20
  • 21. North Texas Assets Positioned for Long-Term Performance Gathering  3,640 miles of pipeline  2,600 MMcf/d capacity Processing  4 plants 1,100 MMcf/d capacity  1 Stabilizer 5 MBbl/d  Truck and rail loading Fractionation  1 plant, 15 MBbl/d capacity Transportation  Gas Pipelines ̶ 260 miles of pipeline ̶ 1,300 MMcf/d capacity  NGL Pipelines ̶ 30 Miles ̶ 20 MBbl/d capacity 21
  • 22. Permian Assets: A Platform in a Prolific Basin Gathering  65 miles of pipeline under construction  65 miles of fuel and gas lift pipeline under construction  200 MMcf/d capacity under construction Processing  1 plant, 58 MMcf/d capacity (50% interest with Apache)  1 plant under construction, 60 MMcf/d capacity  Truck and rail loading Fractionation  1 plant, 15 MBbl/d capacity 22
  • 23. Oklahoma Assets: Solid Platform for Bolt-On Projects Cana  Gathering • 410 miles of pipeline • 530 MMcf/d capacity  Processing • 1 plant • 350 MMcf/d capacity Northridge  Gathering • 140 miles of pipeline • 75 MMcf/d capacity  Processing • 1 plant • 200 MMcf/d capacity $114 $126 Scoop Stack Arkoma Woodford 23
  • 24. Louisiana Assets: Growing Gulf Coast Capabilities Crude Handling  2 terminals  ~18 MBbl/d capacity Natural Gas Transportation  2,000 miles of intra- state pipelines  2.0 Bcf/d of capacity Natural Gas Processing  6 plants  2.5 Bcf/d of capacity NGL Transportation  120 MBbl/d capacity post-Cajun-Sibon  789 miles of NGL pipeline in service  119 miles of NGL pipeline under construction NGL Fractionation  4 plants, ~150 MBbl/d capacity  1 plant under construction, 100 MBbl/d capacity NGL Storage  3.2 MMBbl of underground NGL storage capacity 24 * * The Gulf Coast Fractionator is located in Mont Belvieu Texas and is 38.75% owned by Devon. ENLK owns a contractual right to the economics of Devon’s interest in the Gulf Coast Fractionator. The facility has a capacity of ~145 MBbl/d.
  • 25. Ohio River Valley Assets: Established History of Service Crude/Condensate Transportation  200 miles of crude pipeline, 17 MBbl/d capacity  2,500 miles of unused right-of-way  Truck fleet capacity of 25 MBbl/d  Barge terminal on Ohio River  Rail terminal on Ohio Central Railroad Crude/Condensate Storage  ~600 MBbl of above ground storage Brine disposal wells  8 total wells – 6 owned, 2 jointly-owned in a 50/50 joint venture E2 Compression & Condensate Stabilization  E2 is ~93% owned by ENLC and ~7% owned by E2 management  Capacity of 320 MMcf/d and 16,000 Bbl/d  Two facilities completed, one under construction 25
  • 26. Howard Energy Investment: Strategic South Texas Asset Footprint 26  Howard Energy Partners (“HEP”) is a high growth midstream company with a strategically located asset base in the western Eagle Ford in South Texas  HEP is 31% owned by ENLK, 59% owned by Alinda Capital Partners and 10% owned by HEP management  ~70% of cash flow underwritten by firm contracts with minimum volume commitments Natural Gas  Gathering • ~550 miles of pipeline  Processing • 1 plant • 200 MMcf/d capacity Liquids Logistics  Storage • 225,000 Bbl capacity  Stabilization facility • 10,000 Bbl/d capacity  Rail park with access to Union Pacific Railroad from San Antonio to Corpus Christi

Related Documents