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IPAA OGIS NEW YORK – MDU Resources Group Inc.

MDU Resources Group Inc. · Apr 11, 2011 · 44 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 1
    Investor Relations April 2011 Building A Strong America Terry D. Hildestad President and CEO 1
  2. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 2
    Diversified Natural Resources Diversified Company Asset-Based Solid operators 31.5 26.4 Fiscally responsible track record Strong balance sheet Access to capital Exceptional E ti l workforce kf Construction Regulated…
  3. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 3
    Our Business Utilities Pipeline & Energy Regulated Services 43% Exploration Construction 22% & Production 35% Construction Materials & Contracting Regulated and Construction Non-regulated Note: Based on 2010 consolidated…
  4. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 4
    Proven Strategy Apply our expertise in energy and transportation infrastructure industries to increase market share share, increase profitability and enhance shareholder value. Growth Capital Allocation Opportunistic approach to…
  5. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 5
    Regulated Electric i & Natural Gas Utilities ii i Distributes natural gas and electricity to 964,000 customers, and generates and transmits electricity. Pipeline & Energy Services Engaged in natural gas transportation,…
  6. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 6
    Electric & Natural Gas Utilities Electric WA 125,000 customers ID MT ND 3,000 miles of transmission lines MN OR 4,600 miles of distribution lines SD WY Generation: Owned: - 395 MW Coal Fired - 103 MW Gas Turbines - 55 MW…
  7. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 7
    Rate Case Recovery Electric & Natural Gas Utilities Wyoming Wyoming PSC approved electric rate increase of 2.7 million annually effective May 1, 2010 Primarily related to costs of Wygen III North Dakota Electric rate case request…
  8. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 8
    Future Generation Growth Electric & Natural Gas Utilities Pursuing opportunities associated with potential development of high-voltage transmission lines and system enhancements to deliver renewable energy Regional Transmission Build…
  9. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 9
    Growing Rate Base Electric & Natural Gas Utilities 5-Year 5 Year CAGR 21% 1,101 1,154 1,200 1,084 1,030 973 1,000 745 800 (Millions) 600 362 400 200 2006 2007 2008 2009 2010 2011 2012 MDU Resources…
  10. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 10
    Outlook Electric & Natural Gas Utilities Rate base growth g Cost containment Capitalize on employee expertise through integration Customer Growth Western North Dakota oil activityy Load Growth Agriculture and industrial use of…
  11. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 11
    Pipeline & Energy Services Regulated operations Engaged in gathering, storage, transportation, and energy service related activities. 3,700 miles of pipeline 3,700+ 750 MMcf/d system capability 11 interconnecting points WA 3…
  12. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 12
    Baker Enhancement Pipeline & Energy Services Storage open season February 2010 Ultimate expansion will add MT 125 MMcf/d firm deliverability ND Open season results - Approx. 30% of storage deliverability expansioni SD Subject…
  13. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 13
    More Growth Projects Pipeline & Energy Services Bakken Opportunities Pursuing expansion of natural gas pipeline Currently have 11 receipt points Solicited customer interest for 27 MMcf/d expansion Obtained sufficient interest to…
  14. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 14
    Natural Gas & Oil Production Returns driven Added more than 175 oil drilling locations based on 640-acre spacing last year 646 Bcfe of proved natural gas and oil reserves at year-end 2010 69% Natural Gas 31% Oil Operated Areas…
  15. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 15
    Bakken Saskatchewan Manitoba Bakken Mountrail MT Mountrail County ND County SD Mountrail County, y, ND Natural Gas & Oil Production Our largest oil property Good success Increased production 41% in 2010 over 2009…
  16. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 16
    Bakken Mountrail County Natural Gas & Oil Production Own 16,000 net acres Held by production Drilled 8 wells in 2010 - 37 operated wells in total Average production approx. 3,700 net barrels per day Operated future drilling…
  17. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 17
    Bakken Stark County Saskatchewan Manitoba Bakken on Natural Gass & Oil Productio MT ND Test well 1 Test well 3 Stark County SD Test well 2 MDU Resources Group, Inc. E&P Building A Strong America 18
  18. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 18
    Bakken Stark County Natural Gas & Oil Production Approx. 50,000 net exploratory acres Primary target Three Forks formation First test well, Kostelecky 31-6H - 24-hour IP rate of 1,343 BOE - 94.5% working interest Drilled two…
  19. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 19
    Niobrara Oil DJ BASIN Niobrara Oil Play Activity Samson O&G Play Chesapeake FEPC EOG PLATTE Oil Production FEPC Emerging oil play GOSHEN LARAMIE Early results of other producers appear OUNTAINS Silo…
  20. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 20
    Niobrara Oil Play Natural Gas & Oil Production Hold H ld approx. 65 65,000 000 nett exploratory l t acres - Goshen and Laramie counties, Wyoming De-risked investment with sale of 25% working interest in December Utilize…
  21. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 21
    Heath Shale Play Natural Gas & Oil Production Oil play Hold approx. 80,000 net exploratory acres Plan to drill test well this year MDU Resources Group, Inc. E&P Building A Strong America 22
  22. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 22
    Other Properties Natural Gas & Oil Production Texas South/Central Texas Multi-zone potential (Stacked pays) 2011 projected capital expenditures approx. 47 million 20 wells to be drilled in 2011 Big Horn Basin 2011 projected…
  23. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 23
    Prices & Hedge Positions Natural Gas & Oil Production Assumed 2011 Prices (Feb.-Dec.) Natural Gas: Oil: NYMEX - 4.25 - 4.75 NYMEX - 85 - 90 Ventura - 4.00 - 4.50 CIG - 3.75 - 4.25 Hedges g 2011 2012 Natural Gas 45% - 50% 15% -…
  24. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 24
    Addition to E&P Team Natural Gas & Oil Production Proven leader Extensive experience in oil and natural gas industry Expertise in the Rockies and Texas areas Previously senior executive for BP Kent Wells Named President &…
  25. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 25
    Outlook Natural Gas & Oil Production Capital Expenditures totaling approx. 306 million in 2011 - Includes further exploitation of existing properties, exploratory drilling and 50 million for leasehold acquisitions Projecting 5% to…
  26. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 26
    Construction Construction Materials & Contracting Diverse portfolio of products, services and geography Increasingly valuable aggregate reserves totaling 1.1 billion tons in strategic locations Construction Services Inside…
  27. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 27
    Construction Materials & Contracting States KRC performs work Perform work in 17 states Areas with physical operations 5,000 employees at peak Top 10 U.S. producer 6th Sand and gravel 9th Aggregate 9th Ready-mixed concrete…
  28. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 28
    Vertical Integration Complete Advantage MT ND Asphalt oil Asphalt production SD WY Aggregate Construction based Cement sales Ready-mix/Prestress/ Precast MDU Resources Group, Inc. Construction Building A Strong…
  29. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 29
    Changing Market Construction Materials & Contracting 2006 Backlog Mix 2010 Backlog Mix Public Public 60% 94% Private Private 40% 6% MDU Resources Group, Inc. Construction Building A Strong America 30
  30. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 30
    Demonstrating Adaptability Construction Materials & Contracting Percentage Change 2010 vs. 2009 0% 4.60% 3.40% 3.10% 20% 13.90% 23.30% 40% 30.40% 37.10% 60% 80% 100% 120% 140% 160% 161.90% 180% Revenue Gross Profit SG&A…
  31. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 31
    Outlook Construction Materials & Contracting Low cost structure - SG&A expenses down 38%, compared to 2006 annual expenses, the peak earnings year Dec. 31 backlog 420 million - Includes several highway paving projects, airports,…
  32. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 32
    Construction Services Authorized states of operations Construction services offices Inside Outside Industrial Equipment & Materials - Electrical - Transmission & - Power Plants - Manufacture - Mechanical Distribution -…
  33. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 33
    Adaptability Construction Services SG&A expenses down 31%, compared to 2008 annual expenses, the peak earnings year Inside - Focus on maintenance and service work - Expertise in solar Outside - Large demand for upgrading and…
  34. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 34
    Outlook Construction Services Low cost structure D Dec. 31 bbacklog kl att 373 million, illi which hi h iis 56 million illi hihigher h than Sept. 30 backlog - Includes variety of projects such as substation and line…
  35. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 35
    Consolidated Results (Millions) 2009* 2010** Earnings excluding one-time items 260 260.44 242 242.77 After tax charge (384.4) (16.5) Gain on sale --- 13.8 Earnings/Loss (124.0) 240.0 Earnings per Share 1.40 1.29 Fortune 500…
  36. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 36
    History of Earnings Growth Diversified CAGR 2000-2008: 2000 2008: 16.6% earnings mix 400 350 300 250 (Miillions) 200 00 150 100 50 0 2000 2001 2002 2003A 2004 2005 2006 2007 B 2008 C 2009 D 2010 E Regulated E&P…
  37. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 37
    Cap Ex Growth Increase Cap Ex 27% 3 5B 3.5B in the next 5 years 2.7B 20062010 20112015 Regulated E&P Construction * Excludes acquisitions. MDU Resources Group, Inc. Building A Strong America 38
  38. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 38
    Strong Financial Position 2010 64% Equity 4,500 39% 4,000 36% 37% 34% 3,500 37% 3,000 Millions) 2 500 2,500 Debt/Equity (M 2,000 1,500 1,000 63% 66% 61% 63% 64% 500 0 12/31/2006 12/31/2007 12/31/2008…
  39. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 39
    Credit & Liquidity At December 31, 2010 (Millions) Capacity Outstanding Available Commercial Paper Programs 525 20 * 479 Master Shelves 125 88 38 Revolving Credit Agreements 115 20 * 93 Total 765 128 610 *Outstanding…
  40. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 40
    Indicated Annualized Consecutive quarterly dividend Dividend payments for 5-YEAR CAGR 5% 73 years 0.65 0.54 2006 2007 2008 2009 2010 Dividend increased November 2010, marking 20 consecutive years of increases Committed to…
  41. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 41
    A Base to Grow From Diversified, vertically g integrated with solid Diversified portfolio of businesses Assets Vertically Integrated Asset-based Strong expertise In industries leveraged to economic recovery 35% Solid balance…
  42. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 42
    Construction Its Time to GrOw Regulated E&P Investing substantially in exploration of emerging oil shale plays Bakken oil play position of approx. 66,000 net acres 65,000 net acres in the emerging Niobrara oil play…
  43. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 43
    Our Vision With integrity, create superior shareholder value by expanding upon our expertise to be the supplier of choice h i in i allll off our markets k t while hil bbeing i a safe and great place to work. Construction…
  44. IPAA OGIS NEW YORK – MDU Resources Group Inc. – slide 44
    Building A Strong America 45

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