WELCOME TO HI-CRUSH AUGUSTA: BAML FRAC SAND MINE TOUR AUGUST 26, 2014
Welcome to Hi-Crush YOU ARE HERE 12/31/2013 Third Party Reserve Assessment Tons (MM) Measured Proven Implied Reserve Resources Resource Tons Life (Years) (1) (12/31/2013) (12/31/2013) Wyeville 109.8 62.6 39 Augusta 73.7…
Augusta: Partnerships Growth Vehicle Augusta Overview Newly built facility completed in July 2012 on 1,187 acres Purpose built for processing high-quality Northern White frac sand 46.8MM tons of proven recoverable reserves…
Wyeville: Our Foundation Asset Wyeville Overview 651 acres High-quality Northern White sand Majority of deposit is coarse in nature, primarily comprised of 20/70 mesh size Few impurities such as clay or other contaminants 62.6MM…
Whitehall: Clear Visibility for Growth Whitehall Overview Owned by Sponsor Construction complete and operating First shipment to occur in September 2014 Wet plant building inventory for winter supply 84.3MM tons of proven…
Where We Came From Major Oilfield Service Companies
The Hi-Crush Difference High Quality, Low Cost Key criteria: High-quality reserves with coarse-grade Northern White frac sand Large contiguous acreage Located directly on rail No trucking leads to lower production costs, better…
Low Cost Structure Essential Hi-Crush Partners Production Costs per Ton Produced and Delivered 25.00 1,200,000 1,000,000 20.00 800,000 15.00 600,000 10.00 400,000 5.00 200,000 0.00 1Q 2013 2Q 2013 3Q 2013 4Q…
Proven Track Record of Execution & Efficiency Strong relationships with plant equipment suppliers and construction contractors that precedes Hi-Crush Each plant is designed with intentional redundancies and interchangeable parts…
Investing in Our People and Our Community Personnel mix of experienced and new local hires for newly built facilities All employees at the mines and terminals must adhere to the following programs and policies: Site hazard…
Effective Policies Translate into Operational Success Extensive training, testing, and inspecting reinforces the emphasis on employee safety All employees undergo 24 hours of training mandated by the Mine Safety and Health…
An Overview of What Youll See Today Hi-Crush Production Video 13
Things to Note While on the Tour Things youll see today: Dry plant 250 tons/hour processing capacity (adding 150 TPH with expansion) Wet plant 500 tons/hour current processing capacity (typically running 600+ TPH) Conveyor system…
Lunch Break Welcome Back We hope you enjoyed seeing and discussing our Augusta frac sand plant Please join us for a lunch break before we continue Returns and Value Acceleration 15
Tying it All Together: A Portfolio of Opportunity Wisconsin 4.2 million tons of annual 20/70 capacity* Over 30 years of reserves Marcellus & Utica Exclusive rail access Largest distribution network Niche position in strongest…
Distribution Terminals: Connecting Mine to Market Hi-Crush Distribution Video 17
Our Business Model Q2 2014 Operating Results Tons produced and delivered 953,361 Tons sold(1) 1,024,052 Production cost/ton 14.20 Hi-Crush plants Sold FOB plant direct to customer (67%) Sold at the Sand delivered terminal…
Tons Sold FOB Mine During the Quarter Q2 2014 FOB Mine Sales (3) Permian / Eagle Ford (1) (2) 11% 33% 67% Marcellus / Utica Volume FOB Mine Sold at Volume 7% Oklahoma 66% Terminals Colorado 6% Louisiana 7% Other…
Hi-Crush Terminals Addressing Customer Needs 1 2 Q2 2014 Sand transported by Sand sourced from rail to destination mine terminal Ability to source from Hi-Crush On-site rail access is significant mines, the Sponsors Whitehall…
Financial Performance
Committed to Growing Distribution Long-Term Pattern of raising distribution with quarterly increases Long-term double-digit annual distribution growth Guidance 2.30 2.50 2.30 2.10 2.04 1.96 1.90 * Q3 '13 Q4 '13…
Operator Activity Driving Frac Sand Demand Growth E&P operators are using fracture stimulation techniques, such as increased proppant per stage and increased frac stages per well, to drive well performance These activities are driving…
Rail Access Provides Direct Link from Mine to Basin Class-1 rail lines provide efficient and cost effective access to drilling activity Majority of sand sold into leading areas of activity 2014 Projected Capex by Play (1) ( in…
Capacity Increases Driven by Customer Demand 4.2 Year Average 4.5 Year Life Average Life 2.8 Year Average Life 2.5 Year Average Life 1.2 MM 2.4 MM 3.7 MM 5.6 MM Tons Tons Tons Tons Under Under Under Under Contract…
Proven Production Execution 7.5 MM tons/yr Nameplate capacity of 20/70 sand 6.8 MM 100 mesh tons/yr 4.6 MM tons/yr 3.6 MM tons/yr 4.2 MM tons/yr 3.2 MM tons/yr Wyeville + Wyeville Augusta + + 1.6 MM Augusta Augusta…
Strong Coverage Provides Flexibility for Growth Strong coverage ratio averaging above target coverage of 1.20x Coverage supports step-change in distribution growth and organic expansion 35 1.80x (2) 1.54x 1.60x 30 1.38x (1)…
Levers for Further Performance 28
Appendix
Second Quarter 2014 Summary Three Months Three Months Ended Ended June 30, 2014 June 30, 2013 Recasted Revenues 82,724 37,560 Cost of goods sold (including depreciation, depletion, and amort.) 43,859 17,824 Gross profit 38,865…
Second Quarter 2014 Summary Three Months Three Months Ended Ended June 30, 2014 June 30, 2013 Recasted Reconciliation of distributable cash flow to net income: Net income 29,805 14,437 Depreciation and depletion 2,428 1,505…
Production Costs per Ton Produced and Sold Hi-Crush Partners LP (Wyeville & Augusta)(1) Production Cost per Ton Fiscal Quarter 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 Tons produced and delivered 382,607 557,457 597,659…
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