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MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P.

Rose Rock Midstream, L.P. · Mar 8, 2012 · 45 slides

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Slides

  1. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 1
    SemGroup Corporation & Rose Rock Midstream Morgan Stanley MLP and Diversified Natural Gas Corporate Access Event March 8, 2012
  2. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 2
    Non-GAAP Financial Measures SemGroup Adjusted EBITDA is presented in this presentation for certain periods. Adjusted EBITDA is not a generally accepted accounting principles (GAAP) measure and is not intended to be used in lieu of a GAAP…
  3. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 3
    Non-GAAP Financial Measures Rose Rock Midstream This presentation includes the non-GAAP financial measures of adjusted gross margin and adjusted EBITDA, which may be used periodically by management when discussing our financial results…
  4. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 4
    Ownership Structure Rose Rock NYSE: SEMG Midstream GP, LLC Incentive Distribution Rights Public 41.5 mm Public Shares 7.0 mm Outstanding Common Units 40.9% LP Interest SemMaterials White Cliffs SemStream SemCAMS SemGas…
  5. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 5
    SemGroups Fee-based Business Model Gross Margin Contribution 5% Business Unit Fixed Fee Variable Fee Marketing 10% SemGas 6% 94% SemCAMS 100% SemLogistics 100% SemMaterials Mexico 100% 85% White Cliffs Pipeline 100% Rose Rock…
  6. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 6
    Strategically Positioned in Key Growth Areas Montney/ Duvernay Bakken/ Williston Basin DJ Basin/ Niobrara Mississippi Zone Cushing, OK Crude Oil Granite Storage Hub Wash 3/8/2012 7
  7. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 7
    SemGroup Full Year 2011 Results As Reported (dollars in millions, excluding EPS, unaudited) Full Year 2011 Full Year 2010 Operating income/(loss) 45.6 (50.3) Net income (loss) attributable to SemGroup 2.4 (132.3) Net income (loss) per…
  8. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 8
    SemGroup Segment Results Normalized Full Year Full Year Segment Adjusted EBITDA (dollars in millions, unaudited)(1) 4Q 2011 4Q 2010(2) 2011 2010(3) Crude(4) 16.8 18.9 62.2 71.6 SemStream (0.2) 9.9 (10.1) 26.0 SemGas 3.3 4.1 15.1 13.2…
  9. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 9
    SemGroup Capitalization & Liquidity December 31, December 31, Capitalization (dollars in millions) 2011 2010 Total Debt 109.3 348.4 Owners Equity 978.7 855.1 Total Book Capitalization 1,088.0 1,203.5 Credit Metrics…
  10. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 10
    2012 Capex Guidance (Includes SemGroup and Rose Rock Midstream Capex Projects) 2012 Capital Expenditures - 180 million 4 5 5 2% 3% 3% 21 27 11% Growth 15% Corporate Crude Maintenance 83 46% 55 Gas Refurbishment 31% Products…
  11. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 11
    SemGroup 2012 Adjusted EBITDA Guidance (dollars in millions, unaudited) Low High Net income (loss) attributable to SemGroup 47.1 56.9 Add: Net income attributable to noncontrolling Interests 7.9 7.9 Add: Interest expense 10.0 9.7…
  12. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 12
    Crude Oil
  13. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 13
    Crude Business Overview Rose Rock Midstream DJ Basin/Niobrara Crude storage (fee-based) Location: Kansas, Colorado, Nebraska and Wyoming 5.05 million barrels in Cushing, OK - 12/31/11 Acreage: 60,000+ square miles Production: 95,000…
  14. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 14
    Rose Rock Midstream Results As Reported (dollars in millions, excluding EPS, unaudited) Full Year 2011 Full Year 2010 Operating income 24.9 23.0 EBITDA(1) 36.4 34.4 Selected items impacting comparability(2) (1.6) 4.2 Adjusted EBITDA(1)…
  15. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 15
    Cushing Storage Cushing Storage Contracts(1) 2010 2011 7 million barrels of capacity Crude Storage (millions) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 8 Cushing Capacity 4.2 4.2 4.2 4.7 4.7 4.7 5.05 5.05 6 Leased % 98% 98% 94% 95% 95% 95% 95% 95%…
  16. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 16
    Rose Rock Midstream Capitalization & Liquidity December 31, Capitalization (dollars in millions) 2011 Total Debt 0.1 Owners Equity 304.9 Total Book Capitalization 305.0 Credit Metrics Debt/Capitalization N/M Debt/Adjusted…
  17. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 17
    Rose Rock Midstream 2012 Capex 2012 Capital Expenditures - 37 million 2 2 5% 6% Growth Maintenance Environmental 33 89% Estimated Normalized (USD Millions) Completion 2012 2013 Annual EBITDA Description Date Capex Capex…
  18. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 18
    Rose Rock Midstream 2012 Adjusted EBITDA Guidance (dollars in millions, unaudited) Low High Net income 17.8 19.8 Add: Interest expense 2.8 2.8 Add: Depreciation and amortization 12.4 12.5 Adjusted EBITDA 33.0 35.0 Consistent…
  19. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 19
    White Cliffs Pipeline White Cliffs Pipeline DJ Basin/Niobrara Location: Kansas, Colorado, Nebraska and Wyoming 51% ownership and operator Acreage: Production: 60,000+ square miles 95,000 bpd oil/condensate Active Players:Noble…
  20. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 20
    White Cliffs Pipeline, L.L.C. Summarized Income Statement Information (100% White Cliffs - not adjusted for net ownership interest) Three Months Ended Year Ended December 31, December 31, (dollars in thousands, unaudited) 2011 2010…
  21. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 21
    Natural Gas & Natural Gas Liquids
  22. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 22
    SemGas Business Overview Mississippi Zone Play Location: Northern Oklahoma and southern Kansas Natural gas gathering and Key Producers: Eagle Energy Approximately 75,000 acres leased processing services Sandridge 20 rigs, 209…
  23. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 23
    SemGas Northern Oklahoma Gas Processing Northern Oklahoma Capacity up 77% versus 4Q 2010 Processing Capacity New cryo 35 mmcf/day unit at Hopeton Plant 160 140 135 Debottlenecking of Nash plant resulting in five 120 mmcf/d…
  24. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 24
    SemGas Liquids Upgrade Gas & Liquids Value 6.15/mcf Gas & Liquids Value Liquids Stream Breakdown 5.84/mcf 2% Liquids Upgrade(2) 1.89 10% Liquids Upgrade(1) 1.83 15% 42% 1 mcf Gas 1 mcf Gas Wellhead Btu content 1,220,000…
  25. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 25
    SemGas Contracts SemGas Contract Breakdown Contract Comparison 9% 120% 9% 100% 98% 80% 80% 69% 60% 48% 52% 40% 31% 82% 20% 20% 2% 0% Northern Sherman Kansas Eufaula Oklahoma POP POI Gathering/Fee Long-Term Evergreen…
  26. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 26
    SemCAMS Business Overview Montney - Emerging liquids-rich gas play Location: Wapiti and Kaybob region, Alberta, Canada Two sour and two sweet natural gas processing plants Key Producers: Sinopec Daylight, NuVista, Encana, Celtic,…
  27. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 27
    Equity Interest in NGL Energy Partners LP Completed NGL Energy Partners LP transaction on November 1, 2011 8.93 million common units in NGL Energy Partners 1.40 current annual distribution Forbearance on 3.93 million units first…
  28. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 28
    Products
  29. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 29
    SemLogistics Business Overview Largest independent petroleum products storage facility in U.K. 8.7 million barrels of above ground storage Approval to build nine new tanks; 1.5 million barrels of storage (on hold) Two deep water…
  30. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 30
    SemLogistics Storage Market Update Continued high prompt prices and 22.00 BRENT Forward Spread Curve backwardated market curves are 19.00 16.00 Contango 13.00 keeping customers on sidelines 10.00 7.00 4.00…
  31. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 31
    SemMaterials Mxico Business Overview Provide asphalt products and services 14 in-country terminals Importing product to diversify suppliers Short Tons Sold (Thousands) 120.0 103.9 97.8 100.0 87.9 92.9 93.6 80.0 75.3 57.1…
  32. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 32
    Delivered As Promised Built a foundation for growth Migrated to fee-based business model SemStream asset contribution to NGL Energy Partners Strengthened balance sheet Refinancing Rose Rock Midstream Initial Public Offering…
  33. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 33
    Appendix
  34. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 34
    SemGroup Non-GAAP Financial Data Reconciliations Net income (loss) to earnings before interest, taxes, depreciation and amortization (EBITDA) and excluding selected items impacting comparability (Adjusted EBITDA) reconciliations…
  35. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 35
    SemGroup Selected Items Impacting Comparability (dollars in thousands, unaudited) Three Months Ended Year Ended December 31, December 31, 2011 2010 2011 2010 Loss (gain) on disposal or impairment of long-lived assets 9,634 8,469…
  36. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 36
    Rose Rock Midstream Non-GAAP Financial Data Reconciliations (dollars in thousands, unaudited) Three Months Ended Year Ended December 31, December 31, 2011 2010 2011 2010 Net income 6,828 10,284 23,235 23,477 Add: Interest expense 418…
  37. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 37
    Rose Rock Midstream Distributable Cash Flow (dollars in thousands, unaudited) Three Months Ended December 31 2011 Net income 6,828 Add: Interest expense 418 Add: Depreciation and amortization expense 2,874 EBITDA 10,120 Add: Loss…
  38. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 38
    Crude Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation 12,950 29,449 38,806 13,761 Add:…
  39. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 39
    SemGas Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation 1,136 6,620 6,308 5,087 Add:…
  40. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 40
    SemCAMS Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation (1,111) 2,064 2,868 (5,480) Add:…
  41. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 41
    SemLogistics Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation (44,363) 3,514 (41,440)…
  42. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 42
    SemMaterials Mxico Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation 2,000 (6,585) 2,430…
  43. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 43
    SemStream Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation 39,634 2,762 16,752 (10,501)…
  44. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 44
    SemGroup Corporate & Other Adjusted EBITDA Calculation (dollars in thousands, unaudited) Three Months Ended Year Ended December 31 December 31 2011 2010 2011 2010 Net income (loss) attributable to SemGroup Corporation (9,941)…
  45. MORGAN STANLEY MLP AND DIVERSIFIED NATURAL GAS CORPORATE ACCESS EVENT – Rose Rock Midstream, L.P. – slide 45
    Rose Rock Midstream Non-GAAP Financial Data Reconciliations (dollars in thousands, unaudited) Three Months Ended Year Ended December 31, December 31, 2011 2010 2011 2010 Reconciliation of operating income to adjusted gross margin:…

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