USA Compression Partners, LP Jefferies Global Energy Conference 2013 November 13, 2013
USA Compression Partners Value Proposition Growth Vehicle: Positioned for Growth Established History & Beyond Current Visible Future Operations Attractive Direct Exposure to Current Distribution Areas of Strong Activity…
Overview of USA Compression USAC is a Pure-play Compression MLP Backed by Experienced Energy Investors Ownership Structure Market Data Unit Price (as of 11/08/13) 24.69 Units O/S (mm) 37.1 Riverstone LP Equity Value 916.7 Holdings…
Unit Performance, Yield and Distributions Since IPO 27.25 Announces Q2 Announces S&R Closing of S&R Distribution of Acquisition and Acquisition 26.25 0.44 per Unit Q2 Earnings 25.25 24.25 Announces Q1 23.25 Distribution of 22.25 0.435…
USAC History 15-year History of Growth and Differentiated Business Model 1998: USAC 1998 2010: USAC Dec 2010: Jan 2013: Aug 2013: USAC founded by CEO grows through organic Riverstone USAC completes 182mm Eric Long with development…
USAC Business Overview Not All Compression is Created Equal Large HP Midstream Applications Crude Oil Well Applications Large HP units (Avg: 860 HP) installed in Smaller HP units (Avg: 140 HP) used in gas midstream applications…
USAC Fleet Overview USAC Assets are Infrastructure-Oriented Natural Crude (Gas-Lift) Combined Gas Assets Assets Fleet Total Units 1,247 1,085 2,332 Horsepower 1,009K 154K 1,162K Average Age of Fleet 5.8 years 2.2 years 5.3 years…
Geographical Presence Presence in Key Geographical Regions Primary Key Customer Profile Oil Majors Independent E&Ps Large Midstreams & Processors Regional Gathering Systems Marcellus / Utica Shale Anadarko and Hugoton Basins…
The Need for Compression Critical Infrastructure for Producing & Transporting Hydrocarbons Compression is required to transport natural gas throughout the pipeline system Critical Part of Once installed, becomes part of midstream…
Strategic Focus on Infrastructure Applications Midstream and Crude-Oriented Gas Lift Compression Offer Cash Flow Stability Crude Oil Wells Midstream Applications Rate-Base Applications Regional Gathering Interstate Pipeline Gas Lift…
Domestic Hydrocarbon Production Growing Production Requires Increased Infrastructure Build-Out Natural Gas Production and Gas Rig Count Crude Oil Production Bcf/d Gas Rig Count Mbpd 80 1,800 8,000 70 1,600 7,500 60 1,400 7,000 50 1,200…
Gas Production and Rig Count Drilling Efficiency Enhancing Natural Gas Economics Following a steady climb of gas-directed rig utilization, the last several years have shown a marked decrease in the number of gas-directed rigs…
The Shale Gas Revolution Historical and Projected Natural Gas Production 33 Tcfe 35 Overall natural gas production expected to increase from 63 Bcf/d in 2011 to 91 Bcf/d 30 through 2040, an increase of 44% Substantially all of the…
Shale Compression Needs Shale Production Drives Increasing Compression Requirements (1)(2) (HP) Shale gas is typically produced at lower wellhead pressures (0-50 PSIG) in contrast to conventional 350,000 gas wells (100-300 PSIG)…
Crude Oil Gas Lift Overview of Crude Oil Gas Lift Gas Lift is an artificial method of raising crude oil to the surface when the well lacks sufficient reservoir pressure Producers utilize compression to inject natural gas into the…
Crude Oil Gas Lift Strategic Rationale Infrastructure Assets Leveraged to Crude Oil Economics Necessary part of the production process in unconventional plays using horizontal Infrastructure- drilling Oriented Assets Assets tend to…
USAC Investment Highlights USACs Business Prospects Driven By Positive Macro Drivers in the Midstream Industry Continued focus on infrastructure-oriented compression applications; compression is critical to Critical transporting…
Q&A
Appendix
Non-GAAP Reconciliations Predecessor Successor Year Ended December 31, Year Ended December 31, Nine Months Ended September 30, ( in thousands) 2006 2007 2008 2009 2010 2011 2012 2012 2013 Net income 9,829 7,122 20,911 21,228 10,479 69…
Non-GAAP Reconciliations (contd) Three Months Ended ( in thousands) September 30, 2013 Net income 1,712 Plus: Non-cash interest expense 472 Plus: Depreciation and amortization 13,377 Plus: Share-based compensation 337 Less:…
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