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Credit Suisse 2010 Energy Summit – Tesoro Corporation

Tesoro Corporation · Feb 10, 2010 · 31 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. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 1
    Credit Suisse Energy Summit February 2010
  2. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 2
    Agenda 4Q 2009 Results 2009 Accomplishments Current Supply/Demand Fundamentals 2010 & 3-Year Plan 3
  3. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 3
    Financial Summary in millions, unless noted 4Q 2009 4Q 2008 Throughput (mbpd) 530 555 Gross Margin (/shr) 5.37 12.47 Net Earnings (/shr) (0.99)* 0.70 Cash & Cash Equivalents 413 20 Debt / Capitalization 37% 33% Revolver…
  4. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 4
    Agenda 4Q 2009 Results 2009 Accomplishments 5
  5. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 5
    2009, Another Year of Volatility West Coast 3-2-1 (/bbl) 30 Tesoro EPS 0.37/shr (0.33)/shr 0.24/shr (0.99)/shr* 25 20 15 10 5 0 1Q09 2Q09 3Q09 4Q09 1Q10 Source: Platts * 4Q 2009 results excludes 43 million…
  6. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 6
    Maintain Capital Discipline 2009 Capital Spending ( in millions) 2009 Inventories (mmbbls) 600 25.8…
  7. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 7
    Margin Capture Initiatives 2009 Incremental EBITDA Over 2008 ( in million) Non-Capital Improvements YE 2008 Est. Actual Crude and Feedstocks 110 170 Product Realizations / Optimization 40 100 Transportation Savings 60 30 Production…
  8. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 8
    Lower Breakeven Costs As Presented at 2008 Analyst Day (/bbl) 10.50 1.60 0.65 0.20 0.10 7.95 2008 Breakeven Margin Capture Reduced Capital Energy Maintenance Breakeven After Estimate Program Improvements Improvements…
  9. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 9
    Agenda 4Q 2009 Results 2009 Accomplishments Current Supply/Demand Fundamentals 10
  10. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 10
    Guessing At US Demand US Total Clean Product Supplied (mbpd) 16,000 15,000 14,000 We lost 5-6yrs worth of demand growth 13,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: DOE 11
  11. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 11
    Refining Supply Is Adjusting US Refinery Utilization (%) Recent Refinery Rationalization 100 Region Capacity (mbpd) 90 East Coast US , Canada, Caribbean 735 80 Northwest Europe 340 78% 70 Utilization Japan 265 Hurricane…
  12. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 12
    The West Coast Supply Picture West Coast Utilization (%) West Coast Gasoline Inventories (mmbbls) 100 40,000 90 35,000 80 30,000 70 25,000 60 20,000 2007 2008 2009 2010 2007 2008 2009 2010 Tesoro and Valero represent…
  13. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 13
    Mixed West Coast Economic Indicators Near-Term Long-Term Heavy TARs in Mar-Apr West Coast import structure Recent low crude imports has not changed Positive Indicators Historical Jan-Mar trends: No mass transit systems Demand…
  14. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 14
    Agenda 4Q 2009 Results 2009 Accomplishments Current Supply/Demand Fundamentals 2010 & 3-Year Plan 15
  15. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 15
    2010 Capital Program November 2009 Analyst Day ( in millions) February 2010 Update ( in millions) Change 1Qe 250 -46% 135 2Qe 200 -3% 195 3Qe 125 +32% 165 4Qe 100 +5% 105 Revised 2010 capital program from 675 million to 600…
  16. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 16
    2010 Improvements Change from 2009 (/bbl) 9.65 1.20 0.05 0.20 8.20 2009 Breakeven Plan Improvements Energy Efficiency Throughput 2010 Breakeven Estimate See appendix for assumptions 17
  17. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 17
    2011-2013 Energy and Maintenance Improvements Energy Expense Versus 2008 ( in millions) Maintenance Expense Versus 2008 ( in millions) 20 10 10 0 (10) (20) (20) (30) (40) (35) (40) (50) (45) (45) (50) (50) (60) (55) (55)…
  18. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 18
    Quick Hit Capital Projects: 300 million in 3 years Quick Execution, High Return Focused on High Probability, Return Areas 300 Projects Under Evaluation 50% of projects under 500,000 Only 10% over 5 million Designed to become…
  19. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 19
    Building On Our Base, TSO 2013 Change from 2009 (/bbl) 9.65 1.45 2013 Tesoro Index 1.00 9.00/bbl - - 7.20 2009 Breakeven 2010 2011-2013 Opex 2011-2013 Inc. 2013 Impact 2013 Breakeven Estimate Improvements Capital…
  20. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 20
    Building on our Base, TSO 2013 Our corporate strategy hasnt changed, but weve adapted to a shifting market We continue to execute on our non-capital margin capture initiatives Quick hit income improvement capital drives significant…
  21. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 21
    Appendix
  22. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 22
    Assumptions 2010 Commodity Forecast: Tesoro Index: 9.20/bbl Henry Hub Natural Gas Forward Strip: 5.76/Mmbtu* Cash Breakeven, Quick Hit Capital: All values during 2010-2013 assume constant throughput, energy prices Energy and…
  23. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 23
    Supplemental Financial and Operational Info California Region 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Throughput (mbpd) Heavy Crude 71 119 168 174 133 157 144 188 166 164 164 173 147 Light Crude 37 82 83 82 72…
  24. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 24
    Supplemental Financial and Operational Info Pacific Northwest Region 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Throughput (mbpd) Heavy Crude 11 8 11 14 11 12 13 1 - 7 - - - Light Crude 148 177 169 160 163 143 153…
  25. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 25
    Supplemental Financial and Operational Info Mid-Pacific 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Throughput (mbpd) Heavy Crude 17 13 13 15 15 7 27 32 20 21 17 13 15 Light Crude 66 74 68 59 66 60 44 40 46 48 56 53…
  26. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 26
    Supplemental Financial and Operational Info Mid-Continent 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Throughput (mbpd) Heavy Crude 97 108 111 107 106 104 109 110 97 105 98 104 102 Light Crude 3 5 5 4 4 3 5 5 3 4 3 5…
  27. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 27
    Supplemental Financial and Operational Info Total Refining 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Throughput (mbpd) Heavy Crude 99 140 192 203 159 176 184 221 186 192 181 186 162 Light Crude 348 441 431 408 407…
  28. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 28
    Supplemental Financial and Operational Info Refined Product Sales 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Refined Product Sales (mpbd) Gasoline & Blendstocks 252 326 347 349 319 330 334 327 313 326 307 317 309…
  29. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 29
    Supplemental Financial and Operational Info 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Number of Branded Stations Tesoro Operated 194 453 449 449 449 444 437 391 389 389 389 388 387 Jobber/Dealer 270 438 453 462…
  30. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 30
    Supplemental Financial and Operational Info 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Average Fuel Sales Per Month Per Station (thousands of gallons) Tesoro - Operated 98 176 230 223 197 215 205 208 219 212 214 226…
  31. Credit Suisse 2010 Energy Summit – Tesoro Corporation – slide 31
    Supplemental Financial and Operational Info 2007 2008 2009 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Capital Expenditures Refining California 89 131 148 173 541 132 86 71 102 391 44 60 57 Pacific Northwest 30 26 16 24 96 14 11…

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