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NAPTP MLP Conference – Tesoro Logistics Lp

Tesoro Logistics Lp · May 20, 2015 · 33 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. NAPTP MLP Conference – Tesoro Logistics Lp – slide 1
    Driving Distinctive Growth NAPTP 2015 MLP Conference May 2015
  2. NAPTP MLP Conference – Tesoro Logistics Lp – slide 2
    Key Investment Highlights Leading provider of upstream and downstream logistics services in western United States Growth driven by integrated value chain from wellhead to end users Capturing opportunities from asset optimization,…
  3. NAPTP MLP Conference – Tesoro Logistics Lp – slide 3
    Well Positioned Assets 4
  4. NAPTP MLP Conference – Tesoro Logistics Lp – slide 4
    Strategic Initiatives Focus on Focused fee-based business with long-term minimum commitments Stable, Fee- Maintain minimal commodity risk Based Business Provide full-service logistics offering Optimize Improve operational efficiency and…
  5. NAPTP MLP Conference – Tesoro Logistics Lp – slide 5
    Strong Sponsor Support Feedstock Inbound Logistics Refining Outbound Logistics Product Sales Acquisition Integration with Tesoros value chain provides competitive advantage and strategic support Tesoro provides anchor demand to…
  6. NAPTP MLP Conference – Tesoro Logistics Lp – slide 6
    Track Record of Delivering Value EBITDA Growth Distributions Per LP Unit in millions annualized 2.78 680 1.35 151 319 87 39 42 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14…
  7. NAPTP MLP Conference – Tesoro Logistics Lp – slide 7
    Committed and Diversified Business Model 1Q 2015 Revenue Covered By 2015E Business Mix Minimum Volume Commitments by EBITDA or Acreage Dedications Crude Oil Above Gathering MVCs or Acreage 15% Dedications 30% Terminalling &…
  8. NAPTP MLP Conference – Tesoro Logistics Lp – slide 8
    Crude Oil Gathering Asset Overview 700 miles of crude oil gathering and trunk line pipeline High Plains Pipeline throughput capacity of 190MBD BASH storage capacity of 780MBD Strategy Support Tesoros demand for advantaged Bakken…
  9. NAPTP MLP Conference – Tesoro Logistics Lp – slide 9
    North Dakota Production Outlook North Dakota Pipeline Authority Williston Basin Production Outlook January 2015 2250 MMBD 2000 1750 1500 1250 1000 750 500 37% slowdown in well completions 50% slowdown in well…
  10. NAPTP MLP Conference – Tesoro Logistics Lp – slide 10
    High Plains Pipeline Well Positioned Bakken Breakeven Prices within High Plains Pipeline Footprint /barrel Tier 3 50+ Tier 2 40 - 50 Bakken Core 30 - 40 High Plains Pipeline well positioned within Bakkens core…
  11. NAPTP MLP Conference – Tesoro Logistics Lp – slide 11
    Crude Oil Gathering Growth May 2015 North Dakota Rigs Investing approximately 260 by county million in crude oil gathering opportunities in 2015 Expand Bakken Area Storage Hub to over 1 million barrels Focused expansions to…
  12. NAPTP MLP Conference – Tesoro Logistics Lp – slide 12
    Crude Oil Gathering Committed Customers 1Q 2015 Revenue Covered Under 1Q 2015 Revenue by Minimum Volume Commitments Customer Credit Rating Investment High Yield Grade Above Minimum 20% 15% Volume Commitments 30% Covered…
  13. NAPTP MLP Conference – Tesoro Logistics Lp – slide 13
    Rockies Natural Gas Business Asset Overview Approximately 2,000 miles of natural gas gathering pipeline Natural gas gathering capacity of over 2,900 MMcf/d Four natural gas processing complexes and one fractionation facility Over…
  14. NAPTP MLP Conference – Tesoro Logistics Lp – slide 14
    Rockies Basins Well Positioned Natural Gas Prices Required for 10% Single Well IRR Basins in which TLLP operates Marcellus WV Tier 2 5.67 San Juan CBM 5.37 Eagle Ford- Dry Gas 5.24 Natural Buttes - Mesaverde 5.03 Bernett Core…
  15. NAPTP MLP Conference – Tesoro Logistics Lp – slide 15
    Rockies Natural Gas Growth Investing approximately 90 million in natural gas gathering opportunities in 2015 400 to 500 million in additional opportunities currently under evaluation Focused on increasing utilization and expanding…
  16. NAPTP MLP Conference – Tesoro Logistics Lp – slide 16
    Natural Gas Committed Customers 1Q 2015 Revenue Covered Under Credit Rating by Acreage Dedications and MVCs Number of Customers Above Acreage Dedications and MVCs 10% High Yield 20% Covered Under Acreage Dedications Covered…
  17. NAPTP MLP Conference – Tesoro Logistics Lp – slide 17
    Terminalling & Transportation Asset Overview 24 refined product and storage terminals with over 955MBD throughput capacity Four marine terminals with 795MBD throughput capacity 760 mile Northwest Products System pipeline Over 100…
  18. NAPTP MLP Conference – Tesoro Logistics Lp – slide 18
    Refined Products Market Outlook PADD5 Operable Utilization (%) PADD5 Gasoline Demand (MBD) 95 1,800 90 1,700 85 1,600 80 1,500 75 70 1,400 5 Yr Range 2015 2014 5 Yr Avg. 5 Yr Range 2015 2014 5 Yr Avg. 65 1,300 Jan…
  19. NAPTP MLP Conference – Tesoro Logistics Lp – slide 19
    Terminalling & Transportation Growth Investing approximately 40 million in 2015 New Anacortes, WA products truck-loading terminal Adding additional Tesoro volumes in Southern California through new pipeline interconnects Increasing…
  20. NAPTP MLP Conference – Tesoro Logistics Lp – slide 20
    Terminalling & Transportation Committed Customers 1Q 2015 Revenue By 1Q 2015 Revenue by Minimum Volume Commitments Customer Credit Rating Investment Grade Above Minimum 10% Volume Commitments 30% Covered Under Minimum Volume…
  21. NAPTP MLP Conference – Tesoro Logistics Lp – slide 21
    Capital Plan Overview in millions Consolidated Capital Spend Organic Investment and Optimization Drives Net Maintenance Capital Gross Growth Capital EBITDA Growth 225 390 370 350 200 150 200 70 37 40 50 50 2014 2015E…
  22. NAPTP MLP Conference – Tesoro Logistics Lp – slide 22
    Tesoro Driven Logistics Opportunities Feedstock Inbound Logistics Refining Outbound Logistics Product Sales Acquisition Marine Refinery tank Refined products Wholesale terminals terminals distribution distribution terminals system…
  23. NAPTP MLP Conference – Tesoro Logistics Lp – slide 23
    Distinctive Growth Strategy in millions 2014 2015E 2016E 2017E Gathering (Incl. natural gas) 71 265-285 310-340 335-395 Processing 8 120-140 140-160 150-180 Terminalling and Transportation 260 285-315 300-330 310-340 Drop Downs…
  24. NAPTP MLP Conference – Tesoro Logistics Lp – slide 24
    Financial Discipline Conservative 900 million revolver, expandable to 1.5 billion leverage and ample Expect leverage ratio to return to target range by end of 2015 liquidity Leverage target of 3x to 4x EBITDA Pursue balanced Maximize…
  25. NAPTP MLP Conference – Tesoro Logistics Lp – slide 25
    Value Proposition to Unitholders Distributions Per LP Unit Distributable Cash Flow annualized in millions 113 106% 2.78 Target coverage ratio Since IPO in 2Q 2011 2.57 2.67 1.1x 561 51 53 51 2.46 2.36 36 39 2.26 25 26 2.18…
  26. NAPTP MLP Conference – Tesoro Logistics Lp – slide 26
    Continuing to Drive Unitholder Value Stable Cash Flow Well-Positioned Strong Sponsorship Assets Attractive, Visible Experienced Growth Opportunities Management Team 27
  27. NAPTP MLP Conference – Tesoro Logistics Lp – slide 27
    Appendix
  28. NAPTP MLP Conference – Tesoro Logistics Lp – slide 28
    Non-GAAP Financial Measures RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP (In millions) 2011 2012 2013 2014 2015 Tesoro Logistics LP 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q Reconciliation of EBITDA…
  29. NAPTP MLP Conference – Tesoro Logistics Lp – slide 29
    Non-GAAP Financial Measures (a) We define EBITDA as net income attributable to partners before depreciation and amortization expenses, net interest and financing costs and interest income. We define adjusted EBITDA as EBITDA plus or…
  30. NAPTP MLP Conference – Tesoro Logistics Lp – slide 30
    Non-GAAP Financial Measures Tesoro Logistics LP Distinctive Growth Strategy Annual (In millions) EBITDA 2014A Terminalling and Gathering(1) Processing(1) Transportation(1) Net earnings 49 4 196 Add depreciation and amortization…
  31. NAPTP MLP Conference – Tesoro Logistics Lp – slide 31
    Non-GAAP Financial Measures (In millions) Gathering: Reconciliation of Forecasted EBITDA to Forecasted Net Income Tesoro Logistics LP Gathering Segment Forecasted EBITDA 2015E 2016E 2017E Forecasted Net Income 158 - 178 195 - 225…
  32. NAPTP MLP Conference – Tesoro Logistics Lp – slide 32
    Non-GAAP Financial Measures (In millions) Reconciliation of Forecasted annual EBITDA to Forecasted Net Income: Annual EBITDA Contributions from Drop Downs from Tesoro 2015E 2016E 2017E Forecasted Net Income 28 - 53 56 - 106 84 -…
  33. NAPTP MLP Conference – Tesoro Logistics Lp – slide 33
    Commercial Agreements With Tesoro Termination Provisions Fixed Minimum Initation Volume Tarrif/Fee Force Date Term Renewals Commitment Escalators Refinery Shutdown Majeure Transportation Agreement (High Plains System) Apr-11 10…

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