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Citi MLP Midstream Infrastructure Conference – MPLX Lp

MPLX Lp · Aug 21, 2013 · 62 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. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 1
    Citi 2013 MLP/Midstream Infrastructure Conference August 21-22, 2013
  2. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 2
    MPLX LP Highlights MPLX is a traditional, fee-based MLP No direct commodity price risk Multiple, long-term transportation and storage agreements Marathon Petroleum Corporation (MPC) is an investment grade sponsor, with a large…
  3. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 3
    MPC has Created an Industry-Leading MLP 45 Focus on Fee-Based Businesses Unit Price 40 Pursue Organic Growth Opportunities 35 30 Grow Through Acquisitions and Drop-downs 25 Maintain Safe and Reliable 20 Operations…
  4. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 4
    MLP Equity Market Overview Price Performance since MPLX IPO 80% 70% 60% 61.8% MPLX Percent Change from 10/25/2012 Price 50% 40% 30% 20% 10% 7.3% AMZ 0% -10% MPLX AMZ Source: Bloomberg market data as of…
  5. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 5
    Financial Performance Adjusted EBITDA* Distribution / Unit* in millions / unit 26.7 0.2850 25.1 4.5% Growth 18.2 0.2725 3.8% Growth 0.2625** 4Q'12 1Q'13 2Q'13 4Q'12 1Q'13 2Q'13 Distribution Coverage 1.25x 1.37x 1.27x…
  6. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 6
    MPLX Strong Financial Flexibility to Manage and Grow Asset Base MPLXs undrawn 500 million revolver provides significant liquidity to grow its business As of (MM except ratio data) 6/30/13 Cash and cash equivalents 115.3 Total…
  7. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 7
    MPLX Distribution Growth Annual distribution growth is targeted at 15% to 20% Organic for at least the next several Growth years Acquisitions MPLX could enter the 50% high IDR tier in 2015 Drop- Downs 2014-2016 700 million to…
  8. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 8
    MPC Relationship Provides Robust Growth Opportunities for MPLX Logistics infrastructure is extremely important to MPC's success. MPC intends to use MPLX as the primary growth vehicle for its midstream logistics business. MPLX can…
  9. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 9
    Other MPC Projects MPC's option to purchase a 25% equity interest in Enbridge's Southern Access Extension pipeline project Additional crude oil truck unloading capacity at Canton, Ohio, refinery Truck-to-barge terminal loading…
  10. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 10
    Strategically Located Assets Edmonton Trans Hardisty Burnaby Mountain Anacortes Regina Assets are primarily located Cromer throughout the Midwest and U.S. Clearbrook Montreal Superior Gulf Coast Portland Sarnia In 2011, these…
  11. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 11
    Southern Access Extension - Enbridge Initial capacity 300,000 BPD Target completion 2Q 2015 Flanagan, IL to Patoka, IL Length: 165 miles Anticipated Cost: U.S. 0.8 billion Expenditures to date (3/31/2013) of approximately U.S. 0.1…
  12. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 12
    Strategically Located Assets (Continued) MPLXs assets and a large number Bakken of MPC's retained assets are in the Williston Basin heart of the Midwest Appalachian infrastructure build-out Basin Michigan Antrim Basin…
  13. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 13
    MPC Well Positioned for Utica Shale Options Truck, Barge, Pipeline Multiple Transportation Options Local Demand for Utica Condensate 25 MBPCD between Canton and Canton Catlettsburg presently Wellsville Condensate Splitters at…
  14. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 14
    MPLXs Assets are Integral to MPC Marathon Pipe Line LLC (MPL) and Ohio River Pipe Line LLC (ORPL) comprise one of the largest networks of pipeline systems in the U.S. based on total volume delivered 1,004 miles of common carrier…
  15. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 15
    Ideal Assets for an MLP Historical crude and product volumes have been extremely stable with low variability despite material changes in the broader commodity price environment. Butane cavern and storage facilities generate stable and…
  16. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 16
    Stable and Predictable Cash Flows Revenue Customer Mix1 MPLXs assets consist of fee-based pipeline 11% systems and storage assets 55 MM MPC has historically accounted for over 85% 16% of the volumes shipped on MPLXs pipelines 81…
  17. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 17
    MPC is a Strong Strategic Sponsor MPC is a leading independent R&M company Enterprise value of 23.0 billion1 and LTM EBITDA generation of 6.3 billion 2012 revenue of 82.2 billion, Fortune 50 company Large integrated refining,…
  18. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 18
    High-Quality, Well-Maintained Asset Base MPLX continually invests in the maintenance and integrity of its assets Uses a patented integrity management program to enhance pipeline safety and reliability Top-tier reputation and active…
  19. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 19
    Pipeline Operations Deliver Top-tier Safety Performance Patented integrity management program fully compliant with DOT regulations State-of-the-art in-line assessment practices Leading control room management practices Industry…
  20. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 20
    Key Success Factors Stable and Predictable Cash Flows MPLX is expected to generate stable and predictable cash flows supported by a combination of long- term transportation agreements (linked to FERCbased tariff rates) and storage…
  21. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 21
    Appendix
  22. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 22
    2Q 2013 Earnings Call Highlights Achieved adjusted EBITDA of 26.7 million for the second quarter Generated 27.2 million of distributable cash flow Acquired an additional 5% interest in MPLX Pipe Line Holdings LP from MPC for 100…
  23. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 23
    Net Income 2Q 2013 vs. 2Q 2013 Estimated per S-1 Variance Analysis 45 4.0 (5.7) 40 38.6 1.5 (0.6) (3.0) 34.8 (16.2) 35 30 25 Millions 20 18.6 15 10 5 0 2Q 2013 Tariffs Volumes Other Revenue Cost of Other 2Q 2013 MPC…
  24. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 24
    MPLX Adjusted EBITDA and Distributable Cash Flow Estimated (MM) 2Q 2013 2Q 2013* Adjusted EBITDA 47.4 49.7 Less: Adjusted EBITDA attributable to MPC-retained interest 20.7 23.2 Adjusted EBITDA attributable to MPLX LP 26.7 26.5 Less:…
  25. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 25
    MPLX LP Adjusted EBITDA and Distributable Cash Flow Reconciliation to Net Income (MM) 2Q 2013 1Q 2013 4Q 2012* Net income 34.8 35.3 26.3 Less: Net income attributable to MPC-retained interest 16.2 17.7 13.2 Net income attributable to MPLX…
  26. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 26
    EBITDA Reconciliation to Net Income (Loss) Attributable to MPC 2011 2012 2013 (MM) 4Q 1Q 2Q 3Q 4Q 1Q 2Q Net Income (Loss) attributable to MPC (75) 596 814 1,224 755 725 593 Less: Net interest and other financial income (costs)…
  27. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 27
    Significant Capital Expenditures Major expansion projects Patoka to Catlettsburg Patoka tank farm modifications SCADA project 2013 Capex Budget 1,2 Maintenance Capex 16.75% of 2013 forecasted Adjusted EBITDA* Maintenance 33…
  28. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 28
    MPLX Deficiency Payment Effect Example to be used for illustration purposes only (MM) 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 Quarterly Deficiency payment 2.0 5.0 3.0 - - - - Use or expiration of credit (on or…
  29. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 29
    MPLX Pipeline Throughput Agreements Initial MPC Min. 2011 MPC Est. 12 Mo. Ended 12/31/132 Term Diameter Commitment3 Throughput4 Weighted Average MPC Min. Asset (Years) (Inches) (MBPD) (MBPD) Tariff ( / BBL) Revenue (MM) Crude Systems…
  30. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 30
    Crude Oil Pipeline Systems Overview 31
  31. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 31
    Crude Oil Pipeline Systems Overview MPC Min. Diameter Length Capacity Initial Term Commitment Crude Oil Pipeline System (Inches) (miles) (MBPD)1 (Years) (MBPD)1 Patoka to Lima 20 / 22 302 290 10 40 Catlettsburg and Robinson 20 / 24…
  32. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 32
    Patoka to Lima Crude System 76 miles of 20-inch pipeline extending from Patoka, IL to Martinsville, IL 226 miles of 22-inch pipeline extending from Martinsville to Lima, OH Includes related breakout tankage at Martinsville From…
  33. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 33
    Catlettsburg and Robinson Crude System Primary pipelines supplying crude oil for MPC's Catlettsburg, KY and Robinson, IL refineries Patoka to Catlettsburg System 140 miles of 20-inch pipeline from Patoka to Owensboro, KY 266 miles…
  34. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 34
    Detroit Crude System Samaria to Detroit 44 miles of 16-inch pipeline extending from Samaria, MI to MPC's Detroit refinery System includes a tank farm and crude oil truck offloading facility located in Samaria Current capacity of 140…
  35. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 35
    Wood River to Patoka Crude System Wood River to Patoka System 57 miles of 22-inch pipeline extending from Wood River, IL to Patoka Current capacity of 223 MBPD Roxanna to Patoka System 58 miles of 12-inch pipeline extending from…
  36. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 36
    Midwest Product Pipelines Overview 37
  37. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 37
    Gulf Coast Product Pipelines Overview 38
  38. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 38
    Product Pipeline Systems Overview MPC Min. Diameter Length Capacity Initial Term Commitment Product Pipeline System (Inches) (Miles) (MBPD) (Years) (MBPD) Garyville to Zachary 20 70 389 10 300 Zachary Connect 36 2 -NA- 1 10 80 Texas…
  39. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 39
    Garyville Products System Primary pathway for the distribution of refined products from the Garyville, LA refinery Garyville to Zachary 70 miles of 20-inch pipeline extending from MPC's Garyville refinery to either the Plantation…
  40. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 40
    Texas City Products System Primary pathway for the distribution of refined products from MPC's Texas City refinery Texas City to Pasadena 39 miles of 16-inch pipeline extending from refineries owned by MPC and Valero in Texas City,…
  41. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 41
    Ohio River Pipe Line (ORPL) Products Systems System of single and bi-directional pipelines that connect MPC's Canton and Catlettsburg refineries with MPC and third-party terminals Current combined capacity of 242 MBPD Combined…
  42. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 42
    Robinson Products System 1,173 miles of owned / leased pipelines connecting MPC's Robinson and third-party refineries and terminals in IL, KY and IN Current combined capacity of 545 MBPD Initial MPC minimum throughput commitment…
  43. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 43
    Product Pipelines Detailed Overview Products Pipelines Associated Marathon Diameter Length Capacity Petroleum Throughput Associated Marathon System Name (inches) (miles) (MBPD) Agreement (Yes/No) Petroleum Refinery Garyville products…
  44. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 44
    Other Major MPLX Assets MPC's commitments account for total annual revenue of 34 MM from these Other major assets Neal, W.Va., Butane Storage Cavern Capacity of 1 MMBBL with an initial 10-year term Connected to MPCs Catlettsburg, KY…
  45. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 45
    Legal, Environmental and Regulatory Summary All pipelines are common carrier pipelines regulated by FERC. Regulatory: No pending rate cases. MPLX assets are subject to extensive and frequently-changing federal, state and local laws,…
  46. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 46
    Focused and Integrated Network Refineries Marketing Area Refineries Terminals Pipelines Connecting Pipelines Light Product Terminals Asphalt Terminals Inland Water Terminals Coastal Water Terminals Inland Water…
  47. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 47
    Marathon Petroleum Statistics at a Glance Fortune 50 company Established in 1887 4th largest U.S. refiner Largest in Midwest 2012 Revenues and other income: 82.5 billion 2012 Net income attributable to MPC: 3.39 billion…
  48. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 48
    MPC Strategic Vision Achieve top-tier safety/environmental performance Grow enterprise value Expand platform for MPLX growth Deliver top-quartile refining performance Increase Speedway and Marathon brand assured sales volumes…
  49. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 49
    MPC Corporate Priorities Achieve excellence in safety, environmental performance Balance and operations Maintain investment grade credit profile Customers Increase earnings and and cash flow Discipline Flexibility Shareholders…
  50. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 50
    Responsible Care The Foundation for ALL that we do Health and Safety Profitability Investors Environmental Stewardship Honesty and Integrity Diversity Logistics Refining Stakeholder Engagement Marketing 51
  51. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 51
    Impressive Safety and Environmental Record Safety OSHA Recordable Incident Rate Days Away Rate (Employee and Contractor History) (Employee and Contractor History) 2.00 1.00 0.90 1.00 0.73 0.80 0.50 0.50 0.45 0.61 0.45 0.24 0.31…
  52. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 52
    MPC Strong Credit Profile and Liquidity Historical Financial Summary Financial Policies MM Year Ended 6 Mo. Ended June 30 Committed to Investment Grade profile 2012 2011 2010 2009 2013 2012 Rating Current Total Revenues and Other…
  53. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 53
    Fully Integrated Downstream System Refining and Marketing Seven-plant refining network with 1.7 MMBPCD capacity One of the largest wholesale suppliers in our market area One of the largest producers of asphalt in the U.S. 5,000…
  54. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 54
    MPC Relative Refining Position (MBCD) U.S. Crude Refining Capacity (1) () of U.S. Refineries (1) 3,000 15 2,097 12 11 1,950 2,000 1,808 1,699 10 7 7 7 6 981 958 955 5 5 5 1,000 755 665 5 443 3 0 0 Shell HFC BP…
  55. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 55
    MPC Key Strengths Balanced Operations Crude Oil Refining Capacity Crude Slate 62% PADD II Sour Crude 53% PADD III 47% Sweet Crude 38% As of Feb. 1, 2013 As of June 30, 2013 Assured Sales of Gasoline Production (Speedway +…
  56. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 56
    MPC Galveston Bay Asset Acquisition Highlights Supports MPC strategy to grow in existing and contiguous markets and expand integrated model One of the largest and most complex refineries in the U.S. Well connected to crude and…
  57. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 57
    Galveston Bay Complements MPCs Integrated System Refinery 451,000 BPCD (475,000 BPSD) refinery Nelson Complexity Index: 15.3 Significant recent investments Excellent crude optionality Substantial products logistics opportunities…
  58. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 58
    MPC: Galveston Bay Marketing Assets and Integration Integrated acquisition includes Assignment of branded-jobber contracts representing 1,200 BP retail sites 61 MBPD of gasoline sales Locations primarily in FL, MS, TN and AL BP…
  59. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 59
    Incentive Distribution Rights Marginal Percentage Total Quarterly Distribution Interest in Distributions Per Unit Target Amount Unitholders General Partner Minimum Quarterly Distribution 0.2625 98.0% 2.0% First Target Distribution…
  60. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 60
    MPLX and MPC are Aligned MPLX Organizational Structure Marathon Petroleum MPC views MPLX as integral to Corporation and Affiliates (NYSE: MPC) its operations and is aligned with its success and 100.0% 71.6% incentivized to grow…
  61. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 61
    MPLX Offering Summary Issuer MPLX LP Sponsor Marathon Petroleum Corporation Exchange / Ticker NYSE / MPLX Estimated Distribution Coverage 1.10x Expected Tax Shield 80% for the period from the IPO until December 31, 2015 203…
  62. Citi MLP Midstream Infrastructure Conference – MPLX Lp – slide 62
    Experienced MPLX Management Team Management team includes MPC executive officers with an average 25 years of experience with MPLX's assets Years Experience Position at MPC Position at MPLX Industry With MPC Gary R. Heminger President…

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