Targa Resources Investor Presentation Third Quarter 2011
Targa Resources - Overview 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…
The Targa Story Execution and Growth Industry Dynamics Favor Targas Platform Advances in E&P technology being applied to oil plays and combo oil-gas plays Strong oil and NGL prices drive drilling activity and volumes in gathering and…
Targa Corporate Structure Management & Public Warburg Pincus LLC TRGP Directors Shareholders 2% GP interest 23.1% interest 100% of IDRs 11.6 MM LP units of NGLS (42,400,818 Common Shares) Market Cap: 1.3 billion Enterprise…
Industry Dynamics Impacting Platform Advances in petrophysical, drilling and completion techniques Strong oil and NGL prices Enhance producer economics and support throughput both in G&P and Downstream Frac spread drives…
Partnership Growth Drivers Strong fundamentals and positive industry dynamics create attractive growth opportunities Over 1.2 billion in announced projects and acquisitions Additional growth opportunities across all of Targas…
TRP Quarterly Update LTM as of Q3 2011 vs Full Year 2010 3Q 2011 vs 3Q 2010 Financial Metrics Financial Metrics 120 107 100 500 459 91 396 80 400 59 56 65 300 278 310 60 46 225 200 179 40 20 100 0 0 Distributions…
Solid Financial Profile Positions the Partnership for Growth Committed to maintaining relatively NGLS Leverage Ratio and Unit Price Since IPO 6.0x 40 conservative capital structure to 5.5x underpin access to capital Denotes equity…
TRP Credit Metrics and Liquidity ( in millions) Pricing / Actual Actual Current Capitalization Maturity Coupon 6/30/11 Changes 9/30/11 Cash and cash equivalents 73.1 (4.2) 68.9 Revolving Credit Facility (1,100) Jul-15 L + 225 bps…
Business Division and Segment Review 12
The Partnerships Business Unit Overview Division: Gas Gathering and Processing Logistics and Marketing Marketing & Segment: Field Coastal Logistics Assets Distribution Fractionation NGL Distribution & North Texas System Coastal…
The Partnerships Business and Contract Mix LTM 9/30/11 Segment Operating Margin Contract Discussion Points Marketing and Distribution Field Gathering and Processing contracts 18% are almost entirely POP (percent-of- Field G&P…
The Partnerships Operations Gathering and Processing Gathering and Processing Highlights 21 natural gas processing plants 12,485 miles of natural gas pipeline Leading position across Permian Basin benefitting from oil…
Field Gathering and Processing Segment Outlook Volume Growth Discussion Increasing volume growth North Texas and SAOU inlet volume growth of 15% and 11% over 3Q 2010 Q3 2011 average inlet volume of 628 MMcf/d for the segment is 8%…
Coastal Gathering and Processing Segment Outlook Description Coastal Straddles (including VESCO) Positioned on mainline gas pipelines and process volumes of gas collected from multiple offshore producing areas Gross processing…
Gathering and Processing Contract Mix Q3 YTD 2011 Plant Inlet Volumes Q3 YTD 2011 Operating Margin Fee 3.6% POP 29.4% Coastal G&P Segment Hybrid 40% 36.8% Field G&P Segment 60% POL 10.1% KW/WHP 20.2% Contract Mix…
Disciplined and Consistent Hedging Program NGL and Condensate Hedge Arrangements as of 9/30/2011 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…
Targas Operations Logistics, Marketing & Distribution Key Assets 800 miles of NGL pipeline 385 MBbl/d net fractionation and treating capacity 2.6 MMBbl above ground storage capacity 65 MMBbl salt dome storage capacity…
Logistics Assets - Performance Trends CBF Y-grade Volumes MBbl/d Y-grade fractionation at Mont Belvieu 250 reached full capacity in 2009 225 Average Targas fractionation expansions Mont Belvieu Capacity 78 MBbl/d CBF Train 3 200…
Mont Belvieu Fractionation and NGL Pipeline Expansions 2,500 2213 New fractionation capacity to accommodate increasing y-grade from Rocky Mountains, Mid- 2,000 MB Frac Capacity NGL PL Capacity Continent, Permian Basin and South…
Petchem Feedstock Demand Ethylene Production & Feedstock Flexibility Once feedstock supply is proved, ethylene manufacturing will increase capacity due to globally competitive cost position Ethane markets have been elastic and are…
Price Environment Favors US Export Growth US Propane * Shale production has filled US fractionation 45 0.25 capacity and encouraged investment in 40 0.20 35 expansions 0.15 per gallon 30 0.10 The result was a price that…
Petroleum Logistics Targa Channelview Terminal - Houston Ship Channel Storage and terminaling facility with truck and barge transport capability 544 MBbl above ground storage: crude oil, blend stock, asphalt, marine diesel oil, used…
Marketing and Distribution Segment Fee-based transportation services to refineries and petrochemical companies throughout the US Approximately 760 railcars leased and managed, 70 owned and leased transport tractors, 100 Transportation…
Partnership Investment Highlights Favorable Current industry dynamics across broader upstream and downstream energy value chain are Industry favorably impacting the Partnerships integrated G&P and Logistics and Marketing businesses…
Appendix 29
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 Nine Months Ended September 30, September…
Non-GAAP Measures Reconciliation Millions The following table presents a reconciliation of reported distributable cash flow to net income (loss) for the period shown for TRP: Three Months Ended 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar…
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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