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MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc.

MDU Resources Group Inc. · Mar 10, 2014 · 39 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. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 1
    MDU Investor Relations RESOURCES March 2014 Group, Inc.
  2. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 2
    Diversified Natural Resources Company Earnings Contribution Utilities Pipeline & Energy Services Regulated 30% Construction Exploration 36% & Production 34% Note: 2013 on adjusted basis. Building A Strong America 3
  3. MARCH 2014 INVESTOR PRESENTATION – 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 in all of our markets while being a safe and great place to work. 4 RESOURCES Building A Strong America
  4. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 4
    Shareholder Returns Total Annualized Shareholder Returns MDU Year-to-Date 1 Year 48% 48% 3 Year 18% 32% 33% 10 Year 10% 25% 20 Year 12% MDU S&P 500 S&P 400 Peer Avg. Note: At December 31, 2013 RESOURCES Building A…
  5. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 5
    Execution Leads to Growth Projecting 9% annual rate base growth at Utility next 5 years Approx. 700 million additional rate base Considers organic growth opportunities only Enhancing midstream presence at the Pipeline Construction…
  6. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 6
    Vertically Integrated Advantage Ability to leverage our expertise across business units Diesel topping plant in Bakken region engaging all business segments Strong balance sheet Improved financing options Scale for lower rates…
  7. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 7
    Regulated Businesses Electric & Natural Gas Utilities Distributes natural gas and electricity to 1 million customers Generates and transmits electricity Pipeline & Energy Services Provides natural gas transportation, underground…
  8. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 8
    Electric & Natural Gas Utilities Electric WA 135,000 customers 3,100 miles of transmission lines MT ND MN 4,700 miles of distribution lines OR ID SD Generation: Owned: WY - 392 MW Coal Fired 56% - 98 MW Gas Turbines 14% -…
  9. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 9
    Rate Base & Earnings Growth Electric & Natural Gas Utilities More than tripled rate base Projecting 9% CAGR in and earnings since 2006 rate base next 5 years 1,400 80 1,400 1,200 1,200 1,000 60 1,000 800 800 40 600 600…
  10. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 10
    Substantial Growth Opportunities Electric & Natural Gas Utilities Record 300 million capital expenditures planned for 2014 70 million targeting Bakken to accommodate electric and natural gas load growth 77 million 88-MW gas…
  11. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 11
    Outlook Plan to invest approx. 1.3 billion during next 5 years Expect to grow rate base by approx. 9% compounded annually over next 5 years Large growth projects Rate cases, manage regulated returns Potential projects for…
  12. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 12
    Pipeline & Energy Services Regulated operations 3,800 miles of pipeline Engaged in transportation, gathering, storage, and energy service related activities. Over 1 Bcf/d system capacity 13 interconnecting points 3 storage fields…
  13. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 13
    Bakken Opportunities Through Growing Production Bakken Oil Bakken Natural Gas (MBO/d) (MMcf/d) 2,750 3,900 Historical Forecast Historical Forecast 3,600 2,500 3,300 2,250 3,000 2,000 2,700 1,750 2,400 1,500 2,100 1,250…
  14. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 14
    Dakota Prairie Refinery Process Bakken crude 20,000 barrels/day Process 20,000 barrels/day Projected to be on line late 2014 Bakken crude Year 1 EBITDA Output dieselprojection of 70 fuel, naphtha and - 90 million atmospheric…
  15. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 15
    Proposed Dakota Pipeline 375-mile 24-inch pipe would transport Bakken natural gas from western ND to northwestern MN Expect interconnections with Great Lakes Gas Transmission, Viking Gas Transmission and potentially TransCanada and…
  16. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 16
    Proposed Dakota Pipeline Route Regulated 17 Building A Strong America
  17. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 17
    Outlook Filed rate case on Oct. 31 with FERC requesting 28.9 million annually, expect May 1 implementation of rates Liquid based midstream opportunities Joint venture to build and operate 20,000 BOPD Dakota Prairie Refinery…
  18. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 18
    Construction Materials & Services Materials Top 10 U.S. producer 6th Sand and gravel 9th Aggregate Increasingly valuable aggregate reserves totaling 1.1 billion tons in strategic locations Services Inside, Outside, Industrial…
  19. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 19
    Operational Capabilities Materials Services Products Inside Aggregate, asphalt, ready-mix Commercial concrete, liquid asphalt Mechanical Cement sales Fire suppression Prestress/precast concrete Outside Building materials Power…
  20. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 20
    Building Momentum Construction Earnings Combined Backlog (Millions) (Millions) 140 915 121 950 120 900 103 100 850 80 800 80 73 71 731 750 60 48 48 700 40 650 600 20 550 0 500 2007 2008 2009 2010 2011 2012 2013 12/31/2012…
  21. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 21
    Growing Demand Strength in North Dakota - Combined backlog of approx. 97 million at Dec. 31, compared to 46 million a year ago - Greenfielding materials locations in key growth markets - Services expertise in transmission and…
  22. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 22
    Outlook Substantially higher backlog totaling 915 million Strengthening markets in key areas Strong national indicators for business Public work expanding Expanded operations in North Dakota Highly-skilled specialized workforce 1.1…
  23. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 23
    Exploration & Production Significantly grow earnings and NAV by: Targeting oil to maximize profitability Expanding key existing positions and exploring emerging opportunities Leveraging our horizontal drilling and Two producing…
  24. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 24
    Returns Based Investing Exploration & Production Production Mix 2008 2013 Natural Gas Natural Gas 80% 45% Oil - 16% Oil - 47% NGL 8% NGL 4% E&P Deploying capital toward higher returns for oil 25 Building A…
  25. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 25
    Oil Growth Net Oil Production (MBbls) Increased oil production 5,000 by 30% in 2013 to 4.8 4,500 million barrels 4,000 2013 Oil reserve 3,500 replacement 277% 3,000 2,500 2,000 1,500 1,000 500 0 2009 2010 2011 2012…
  26. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 26
    Bakken Mountrail County Exploration & Production Targeting middle Bakken with potential upside with Three Forks formation and downspacing Approx. 16,000 net acres 1 rig deployed New completion technique with cemented liners and…
  27. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 27
    Bakken Saskatchewan Manitoba Bakken Stark County Exploration & Production MT ND Stark County Primary target Three SD Forks formation Approx. 51,000 net acres 1 rig deployed New completion technique with cemented liners…
  28. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 28
    Paradox WY Paradox Basin UT CO Grand County Exploration & Production Moab Cane Creek Unit Approx. 130,000 net acres, AZ San Juan County plus 20,000 acres under option Recently acquired 35,000 net acres Added 2nd…
  29. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 29
    Paradox Basin Exploration & Production 4Q net production approx. 2,850 BOPD, up 89% from 4Q 2012 CCU 12-1 amongst best onshore oil wells drilled in U.S. in 2012 Flowed for 9 months at constant 1,500 BOPD Still flowing at 1,000 BOPD…
  30. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 30
    Paradox Basin Clastics Upside Stratigraphic Cross Section NW SE Ismay Salt 1 Clastic 1 Clastic 2 Clastic 4 Clastic 5 Clastic 7 Clastic 8 Clastic 9 Clastic 10 Clastic 12 Clastic 14 Clastic 18 Cane Crk. Base Salt…
  31. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 31
    Paradox Basin: Uphole Clastics Overview: Oil-bearing reservoirs above prolific Cane Creek Shale Vast majority of Fidelity acreage expected to be productive Moderate risk, high reward oil play Anticipated per well EUR: 150 400 MBO…
  32. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 32
    2014 Outlook Exploration & Production Returns Based Investment Philosophy Hedged to Support Oil Growth Accelerating oil growth 2014 10% to 20% increase in oil production Oil Led by growth in Bakken and Paradox Amount hedged (BOPD) 5%…
  33. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 33
    Consolidated Results Adjusted Earnings Adjusted EPS (millions) 289.9 1.53 218.9 1.16 2012 2013 2012 2013 Reconciliation 2012 2013 GAAP earnings (loss) (1.4) 278.2 Discontinued operations (13.6) .3 Unrealized commodity…
  34. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 34
    Capital Expenditures Growth 4.4B 3.2B Increase Cap Ex Construction E&P 39% Regulated next 5 years 2009-2013 2014-2018 Note: Excludes recently announced pending Powder River Basin acquisition, unidentified acquisitions and…
  35. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 35
    Strong Financial Position 2013 60.5% Equity / 39.5% Debt 5,000 4,500 4,000 3,500 Debt/Equity (Millions) 3,000 2,500 2,000 1,500 1,000 61% 64% 66% 60% 63% 500 0 12/31/2009 12/31/2010 12/31/2011 12/31/2012 12/31/2013…
  36. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 36
    Credit & Liquidity At December 31, 2013 (Millions) Capacity Outstanding Available Commercial Paper Programs 625 154 471 40% Revolving Credit Agreements 115 15 98 * Construction Total Exploration 740 169 569 24% & Production…
  37. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 37
    Dividend Growth 76 76 consecutive years of Years 0.71 quarterly dividend payments Dividend increase announced November 0.48 2013, marking 23 consecutive years of increases Committed to paying a 2004 2005 2006 2007 2008 2009…
  38. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 38
    Outlook Strong performance in 2013 positioned for growth Utility record 300 million capital program in 2014 driven by customer and load growth particularly in North Dakota Pipeline expanding its liquids-based midstream assets through…
  39. MARCH 2014 INVESTOR PRESENTATION – MDU Resources Group Inc. – slide 39
    MDU Building A Strong America RESOURCES Group, Inc.

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