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AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc.

MDU Resources Group Inc. · May 7, 2012 · 43 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. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 1
    Regulated MDU Resources Group, Inc. E&P Terry D. Hildestad President and CEO Building A Strong America Construction 1
  2. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 2
    Diversified Natural Resources Company Diversified Di ifi d Asset-Based Solid operators Fiscally responsible Strong balance sheet Access to capital Exceptional workforce M D U 3
  3. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 3
    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. Building A…
  4. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 4
    Strength Through Diversification 2011 Earnings Contribution Utilities Pipeline & Energy Regulated Services 40% C Construction i Exploration 24% & Production 36% Note: Earnings before discontinued operations.…
  5. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 5
    Superior Shareholder Returns Total Annualized Shareholder Returns 10Year YTD 5% 8% 8% 3 Year 15% 8% 10 Year 4% 20 Year 12% 0% 5% 10% 15% MDU S&P 500 S&P 400 Note: At March 31, 2012 M D U 6
  6. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 6
    Roadmap to Success E&P Regulated Strong portfolio of properties Electric & Natural Gas Utilities Oil economics are robust Increasing value Projecting substantially higher oil Specifically identified organic growth production this…
  7. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 7
    Exploration & Production Headquartered in Denver, CO Two T producing d i regions: i Rocky Mountain Region 76% of proved reserves* Mid-Continent/Gulf States 24% of proved reserves* Q1 2012 production 29 MBOE/d 36% Oil 72%…
  8. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 8
    Accelerating Oil Growth Exploration & Production 50%+ Oil % of Total Production Target Plan to invest a minimum of 400 million illi iin 2012 32% Solid set of assets to grow from 100 200 MMBO potential Targeting 50%+ oil 2006…
  9. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 9
    Key Operating Areas Exploration & Production Bakken Areas Net et Acres: c es 124,000 ,000 MT ND Heath Shale Net Acres: 90,000 Cedar Creek Anticline Net profits interest WY Niobrara UT Net Acres: 65,000 CO Growing Areas…
  10. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 10
    Bakken Acreage Exploration & Production 160 million in spending expected in Bakken in 2012 Approx. 40% of our E&P budget Bakken Approx. 124,000 net acres Production Mountrail County, Approx. 16,000 Currently our largest oil…
  11. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 11
    Bakken Mountrail County Exploration & Production Key development area - 16,000 16 000 net acres New field production record 5,000 net BOPD operated and non-operated Strong recent well results Over 50 future gross locations C…
  12. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 12
    Bakken Stark County Key growth area Primary target Exploration & Production Three Forks formation Approx. 51,000 net acres Plan to drill 7 operated wells in 2012 Saskatchewan Manitoba Approx. 140 gross Bakken potential…
  13. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 13
    Bakken Richland County Exploration & Production Recently established core 57,000 net acre block adjacent to prolific Elm Coulee Field Acquisition of 27,000 net acres closed 1Q 2012 Targeting Three Forks formation Approx. 100…
  14. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 14
    Paradox Basin Paradox WY UT CO Grand County Hold approx. 75,000 Cane Creek Unit nett acres San Juan County Exploration & Production AZ Approx. 70 potential gross well sites with Gross EUR 250 1,000 MBO/well…
  15. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 15
    Niobrara Exploration & Production Approx. 65,000 net acres Successful transaction with non- op JV partner Drilled 4 appraisal wells Marginal results in middle block Southern block still being appraised Results expected to be…
  16. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 16
    Texas Texas Exploration & Production Multi-zone M lti potential t ti l (stacked ( t k d pays)) Price uplift from high liquids yield Plans to drill approx. 20 wells this year Approx. 50 potential gross drilling locations Gross…
  17. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 17
    Heath Shale Play Hold approx. 90,000 net acres Exploration & Production Data from recent appraisal wells expected 2Q EUR potential 165 - 220 MBO/well M D U E&P Building A Strong America 18
  18. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 18
    Outlook Exploration & Production 20% to 30% increase in oil production Hedge Position as of April 30, 2012 over 2011 levels Led by growth in Bakken 2013 2012 12% to 20% decrease in natural gas Natural Gas Natural Gas production…
  19. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 19
    Construction Materials & Services Materials Top 10 U.S. producer 5th Sand and gravel 9th Aggregate 9th Ready-mixed concrete Increasingly valuable aggregate reserves totaling 1.1 billion tons in strategic locations Services…
  20. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 20
    Signs of Stability Materials & Services Construction Earnings (Millions) 47.6 48.0 Positioned to grow Peak earnings 120.8 million in 2007 Significantly lower cost structure now 2010 2011 MDU Resources Group, Inc. Building A…
  21. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 21
    Materials Vertically Integrated MT ND Asphalt oil Asphalt production Aggregate Construction based Cement sales Ready-mix/Prestress/ Precast M D U Construction Building A Strong America 22
  22. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 22
    Services Specialized & Highly Skilled Inside - Focus on maintenance and service work - Expertise in solar Outside - Large demand for upgrading and constructing transmission and distribution systems Aging transmission network…
  23. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 23
    Growing Bakken Demand Materials & Services Aggregate, asphalt and ready-mix provider Road construction Subdivision site work Utility underground and hook ups Electric power lines Substation construction Commercial and industrial…
  24. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 24
    Substantial Opportunities Materials & Services Ports of Southern California Strong Markets Long Beach - 25M contract for Phase I North Dakota saw record quarter Los Angeles - 1.2 million tons of aggregate, Ohio casinos, industrial…
  25. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 25
    Outlook Materials & Services Reorganization g and combination of construction businesses March 31 combined backlog of 865 million - Highway paving projects, airports, bridge work, reclamation, harbor expansion, substation and line…
  26. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 26
    Regulated Businesses Electric & Natural Gas Utilities Di Distributes t ib t natural t l gas andd electricity l t i it tot 974,000 customers Generates and transmits electricity Pipeline & Energy Services Engaged in natural gas…
  27. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 27
    Electric & Natural Gas Utilities Electric WA 127,000 customers MT ND 3,000 miles of transmission lines OR ID MN 4,600 miles of distribution lines SD Generation: WY Owned: - 395 MW Coal Fired - 114 MW Gas Turbines - 55 MW…
  28. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 28
    Rate Base & Earnings Growth Electric & Natural Gas Utilities Rate Base Earnings (Millions) 1,200 80 1,000 60 800 600 40 400 20 200 0 0 2006 2007 2008 2009 2010 2011 Rate base growth has driven earnings growth…
  29. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 29
    Growing Rate Base Electric & Natural Gas Utilities C E CapEx D Depreciation i ti (Millions) 1,000 6% CAGR projected for rate base for 2012 2016 800 Capital expenditures greater than 600 depreciation equals growing rate…
  30. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 30
    Bakken Opportunities Electric & Natural Gas Utilities More than 50 million capital expenditures targeted for Bakken area in 2012 Customer growth 6% electric in Bakken compared to a year ago Higher growth expected in 2012 Water depot…
  31. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 31
    Outlook Electric & Natural Gas Utilities Rate base growth Plan to invest approx. pp 915 million duringg next 5 yyears Generating approx. 370 million additional rate base 85 million 88-MW simple cycle natural gas turbine in Mandan,…
  32. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 32
    Regulated MDU Resources Group, Inc. E&P Doran N. Schwartz Vice President and CFO Building A Strong America Construction 33
  33. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 33
    Pipeline & Energy Services Engaged in gathering, storage, transportation, Regulated operations and energy service related activities. 3,700 miles of pipeline 860 MMcf/d system capability WA 12 interconnecting points MT ND 3…
  34. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 34
    North Dakota Daily Production (MMcf/d) As of February 29, 2012 (MBopd) 1,200 1,200 Historical Forecast Pipeline & Energy Services 1,000 1,000 800 800 Current Prod Oil 558 MBopd 600 Gas 601 MMcf/d 600 400 400 200 200…
  35. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 35
    Bakken Diesel Plant Opportunity Pipeline & Energy Services Studying feasibility of joint venture Process underway to build and operate topping plant Site selection Experienced partner Permitting Calumet Refining, LLC Crude oil…
  36. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 36
    Outlook Pipeline & Energy Services Pursuingg opportunities pp to pprovide oil and natural ggas ggatheringg and pprocessingg services in oil plays Bakken diesel topping plant would process 20,000 bpd of crude Nearly 50% refined…
  37. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 37
    Consolidated Results First Quarter Consolidated Results (Millions) 42.8* 35.6 Performed att the th upper range of guidance 2011* 2012 2011* 2012 EPS 0.23 0 23 0.19 0 19 * Includes the effect of an approximate 4…
  38. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 38
    Capital Expenditures Growth 3 7B 3.7B 2.7B Increase Cap Ex 37% next 5 years 20072011 20122016 Regulated E&P Construction Note: Excludes acquisitions. Building A Strong America M D U 39
  39. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 39
    Strong Financial Position 4,500 4,000 39% 36% 34% 3,500 37% 34% 3,000 2011 Millions) 2,500 66% Equity E it Debt/Equity (M 2,000 1,500 1,000 66% 61% 63% 64% 66% 500 0 12/31/2007 12/31/2008 12/31/2009…
  40. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 40
    Credit & Liquidity At December 31, 2011 (Millions) Capacity Outstanding Available Commercial Paper Programs 500 --- 478 * 40% Revolving Credit Agreements 115 8 105 * Construction Total Exploration 615 8 583 24% & Production…
  41. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 41
    Dividend Growth 0.67 Consecutive 0.43 quarterly dividend payments for 74 years Dividend increased November 2011, marking 21 consecutive years of increases Committed to paying a competitive dividend M D U Building A…
  42. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 42
    Roadmap to Success In excellent position to take advantage of growth opportunities Approx. 600 million in available liquidity in addition to 163 million in cash on hand at year-end Significant investment in our company Intend to…
  43. AMERICAN GAS ASSOCIATION'S FINANCIAL FORUM – MDU Resources Group Inc. – slide 43
    Regulated MDU Resources Group, Inc. E&P Building A Strong America Construction 44

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