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Q1 2012 EARNINGS CALL – Targa Resources Corp.

Targa Resources Corp. · May 3, 2012 · 32 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. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 1
    Targa Resources Investor Presentation First Quarter 2012 May 3, 2012
  2. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 2
    Targa Resources - Overview 3
  3. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 3
    Position in the Midstream Natural Gas Industry The Partnership is one of the few midstream companies with leadership positions in both gathering and processing and NGL logistics Natural Gas Gathering and Processing Logisticsand…
  4. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 4
    The Targa Story Execution and Increasing Growth Industry Dynamics Favor Targas Integrated Midstream Platform Advances in E&P technology and strong oil and NGL prices drive drilling activity and volumes in gathering and processing…
  5. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 5
    Targa Corporate Structure Management & Public Warburg Pincus LLC Directors(1) Shareholders 11.2% interest(1) 20.5% interest(2) 68.3% interest (42,440,793 Common Shares) Targa Resources Corp. 100% Indirect Ownership (NYSE:…
  6. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 6
    Industry Dynamics Favor Targas Platform Advances in E&P technology and strong oil and NGL pricing drive producer activity E&P activity, largely in oil or liquids- rich resource plays, benefits Targa G&P volumes Oilier portion of…
  7. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 7
    Partnership Growth Drivers Strong fundamentals and positive industry dynamics create attractive growth opportunities Organic growth projects and acquisitions contribute to increased scale and diversity Additional growth opportunities…
  8. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 8
    Strong Distribution Growth and Coverage Ratio NGLS Annualized Distribution Per LP Unit Q1 2012 Adjusted EBITDA increased 35% over Q1 2011 3.00 Expected 10% to 15% distribution growth 2.75 Annualized Distributions per LP Unit…
  9. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 9
    Fee-based Contract Mix Increasing 80.00 100% Petroleum Logistics CBF Train 4 70.00 60 Propane Exports 60.00 55 75%Longhorn Project 47 49 50.00 45 40%-50%+ 40.00 37 37 50% 30 31% 31% 32% 30.00 28% 30% 30% 23 25% 20.00…
  10. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 10
    Disciplined Hedging Program NGL and Condensate Hedge Arrangements as of 3/31/2012 14,000 2.50 12,000 Weighted average price 2.00 Volume (Bbls/d) 10,000 1.50 (/gallon) 8,000 6,000 1.00 4,000 0.50 2,000 0 0.00…
  11. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 11
    Solid Financial Profile Positions the Partnership for Growth Committed to maintaining relatively NGLS Leverage Ratio and Unit Price Since IPO conservative capital structure to 6.0x 45 underpin access to capital Target leverage…
  12. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 12
    TRP Quarterly Update 160 Q1 2010 Q1 2011 Q1 2012 145 FY 2010 FY 2011 LTM Q1 2012 140 600 500 491 519 120 106 107 98 396 in milions 100 400 in millions 368 76 337 80 70 72 300 277 55 232 246 60 200 179 39 40 100…
  13. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 13
    Targa Resources Two Public Companies Targa Resources Partners LP Targa Resources Corp. (NYSE: NGLS) (NYSE: TRGP) IPO February 2007 IPO December 2010 MLP C-Corp Owner/Operator of all assets General Partner of NGLS Market Cap: 4.0…
  14. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 14
    Business Division and Segment Review 15
  15. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 15
    Targas Integrated Midstream Platform LTM as of 3/31/2012 Segment Operating Margin Marketing and Distribution 15% Field G&P Logistics 38% Assets 21% Coastal G&P 26% 16
  16. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 16
    Gathering and Processing Division Gathering and Processing Highlights 20 natural gas processing plants 12,485 miles of natural gas pipeline 28 MBbl/d per day fractionation capacity at North Texas and LOU Leading position across…
  17. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 17
    Field Gathering and Processing Segment LTM as of 3/31/2012 Segment Operating Margin 2012 inlet volume expected to be approximately Marketing and 10% higher than 2011 Distribution 15% Field G&P Total of 9 plants with 847 MMcf/d of…
  18. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 18
    North Texas and SAOU Overview North Texas North Texas Operating Statistics 225 204 4,200 miles of gathering pipeline, two processing plants 180 with gross capacity of 278 MMcf/d and fractionation 163 174 162 25 capacity of 15…
  19. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 19
    Permian Business and Versado Overview Permian Operating Statistics Permian Business (primarily Sand Hills) 146 134 1,400 miles of pipeline and one processing plant with 129 120 118 17 gross capacity of 150 MMcf/d 112 15 16…
  20. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 20
    Coastal Gathering and Processing Segment LTM 3/31/2012 Segment Operating Margin Marketing and Distribution 15% Field G&P 38% Logistics Assets 21% Coastal G&P 26% LOU (Louisiana Operating Unit) Onshore gathering and…
  21. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 21
    Logistics and Marketing Division Logistics Assets Highlights The Partnership is the second largest operator of fractionation capacity in Mont Belvieu and Louisiana combined CBF, GCF and Mont Belvieu terminaling and fractionation…
  22. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 22
    Logistics Assets LTM 3/31/2012 Segment Operating Margin Logistics Assets Highlights Marketing and Distribution Second largest operator of fractionation capacity 15% in Mont Belvieu and Louisiana Field G&P 38% Targa Logistics…
  23. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 23
    Logistics Assets - Performance Trends CBF Y-grade Volumes MBbl/d 275 Y-grade fractionation at Mont Belvieu reached full capacity in 2009 250 Mont Belvieu 225 Targas fractionation expansions Fractionation 200 78 MBbl/d CBF Train 3…
  24. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 24
    Environment Favors U.S. Propane/ Butane Export Growth US Propane Favorably priced U.S. Gulf Coast propane and 45 0.80 butane exported predominantly to the Americas, 40 0.70 with spot opportunities to the Far East 35 0.60 30 0.50…
  25. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 25
    Petroleum Logistics Majority of revenue generated through fixed-fee contracts based on volume capacity with take-or-pay features Favorable global supply-demand dynamics and increased need for terminal services Portfolio of…
  26. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 26
    Marketing and Distribution Segment LTM 3/31/2012 Segment Operating Margin Marketing NGL Marketing and Distribution Manage physical distribution of mixed NGLs 15% Field G&P and specification products using owned and 38% third party…
  27. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 27
    Partnership Investment Highlights Advancements in geophysical, drilling and completion techniques drive drilling activity in oil and Favorable liquids rich gas plays Industry Activity and strong oil and NGL prices help drive volumes…
  28. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 28
    Appendix 29
  29. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 29
    Pro Forma Credit Metrics and Liquidity Pricing / Actual Q1 Actual Cash and Debt Maturity Coupon 12/31/11 Adjustments 3/31/12 Cash and cash equivalents 55.6 30.7 86.3 Senior Secured Debt Jul-15 L + 225 bps - (498.0) (498.0) Total…
  30. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 30
    Non-GAAP Measures Reconciliation The following table presents a reconciliation of Adjusted EBITDA and operating margin to net income (loss) for the periods shown for TRP: Three Months Ended March 31, 2011 2010 ( in millions)…
  31. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 31
    Non-GAAP Measures Reconciliation Millions The following table presents a reconciliation of reported distributable cash flow to net income (loss) for the periods shown for TRP: Three Months Ended 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar…
  32. Q1 2012 EARNINGS CALL – Targa Resources Corp. – slide 32
    Non-GAAP Measures Reconciliation The following table presents a reconciliation of operating margin to net income (loss) for the periods shown for TRP: Three Months Ended 3/31/2010 6/30/2010 9/30/2010 12/31/2010 3/31/2011 6/30/2011…

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