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Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp

Antero Midstream Partners Lp · Aug 19, 2015 · 45 slides

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Slides

  1. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 1
    Citigroup MLP / Midstream Infrastructure Conference August 19 20, 2015
  2. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 2
    ANTERO ADVANCED WASTEWATER TREATMENT COMPLEX Advanced Wastewater Treatment Complex Water Asset System Map Veolia Water Technologies, Inc. will design and build the largest advanced wastewater treatment complex in Appalachia to…
  3. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 3
    ANTERO INTEGRATED WATER BUSINESS Advanced Wastewater Treatment Illustrative Produced & Flowback Water Volumes Anteros advanced wastewater treatment facility will (Bbl/d) 80,000 Antero Advanced Wastewater Treatment Capacity (Bbl/d)…
  4. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 4
    LEADING UNCONVENTIONAL MIDSTREAM BUSINESS MODEL High Growth Sponsor Largest Dedicated Core Drives AM Throughput Liquids-Rich Acreage and Distribution Growth Position in Appalachia 2 3 Growth Liquids- Premier E&P Operator…
  5. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 5
    SPONSOR STRENGTH LEADERSHIP IN APPALACHIAN BASIN Antero has the largest proved reserve base, the largest core liquids-rich acreage position and is one of the largest producers in the Appalachian Basin Top Producers in Appalachia (Net…
  6. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 6
    SPONSOR STRENGTH MOST ACTIVE OPERATOR IN APPALACHIA COMBINED TOTAL 12/31/14 RESERVES Assumes Ethane Rejection Net Proved Reserves 12.7 Tcfe Net 3P Reserves 40.7 Tcfe Pre-Tax 3P PV-10 22.8 Bn 1H 2015 Avg SW Marcellus & Utica(2)…
  7. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 7
    GROWTH HIGHEST GROWTH LARGE CAP E&P Anteros 40%+ production growth guidance for 2015 leads the U.S. large cap E&P industry(1) and drives AM growth 45% 40%+ 35% 27.4% 26.2% 25.9% 24.1% 25% 19.7% 14.4% 15% 11.7% 11.5%…
  8. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 8
    GROWTH HIGH GROWTH MIDSTREAM THROUGHPUT Low Pressure Gathering (MMcf/d) High Pressure Gathering (MMcf/d) 1,200 Utica Marcellus Utica Marcellus 1,197 1,200 1,134 935 965 1,000 1,000 908 738 800 800 600 531 600 531 386 400 331…
  9. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 9
    LIQUIDS-RICH LARGEST CORE POSITION Antero has over 3,000 undeveloped rich gas locations with an average lateral length of 6,800 in its 3P reserves Antero has the largest core liquids- rich position in Appalachia with 385,000 net…
  10. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 10
    SUSTAINABLE BUSINESS MODEL AR MULTI-YEAR DRILLING INVENTORY SUPPORTS LOW RISK, HIGH RETURN GROWTH PROFILE Antero has reduced average well costs for a 9,000 lateral by 16% in the Marcellus and 18% in the Utica as compared to 2014 well…
  11. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 11
    SUSTAINABLE BUSINESS MODEL LOW BREAK-EVEN PRICE ECONOMICS Marcellus and Utica undeveloped 3P rich-gas locations have the lowest break-even prices for both oil and natural gas compared to other U.S. shale plays North American…
  12. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 12
    HIGH VISIBILITY PROJECTED MARCELLUS MIDSTREAM BUILDOUT 2014 2015 2016 2017 2018+ 12
  13. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 13
    HIGH VISIBILITY PROJECTED UTICA MIDSTREAM BUILDOUT 2014 2015 2016 2017 2018+ 13
  14. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 14
    MITIGATED COMMODITY RISK 100% FIXED FEE RICH TO DRY (1) Contract Mix Commodity Commodity Based Commodity Based Based Commodity Fixed Fixed Fixed Based Fee Fee Fee 100% 100% 100% Fixed Fixed Fixed Fee Fee Fee 94% 97%…
  15. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 15
    MITIGATED COMMODITY RISK FIRM TRANSPORTATION & SALES PORTFOLIO Antero Resources Transportation Portfolio Antero Resources has built the largest firm transportation portfolio with 4.85 BBtu/d by year end 2018 BBtu/d 5.0 AR Gross Gas…
  16. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 16
    MITIGATED COMMODITY RISK INTEGRAL TO BUSINESS MODEL Hedging is a key component of Anteros business model which includes development of a large, repeatable drilling inventory Antero has realized 1.3 billion of gains on commodity hedges…
  17. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 17
    VALUE CHAIN OPPORTUNITY FULL MIDSTREAM VALUE CHAIN Well Pad Condensate Gathering End Stabilization Users (Miles) YE 2014 YE 2015 Compression (Miles) YE 2014 YE 2015 Utica 16 20 Marcellus 62 81 Low Pressure Gathering Utica 35…
  18. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 18
    STRONG FINANCIAL POSITION SIGNIFICANT FINANCIAL FLEXIBILITY AM Liquidity (6/30/2015) Financial Flexibility Undrawn 1 billion revolver in place to fund future growth ( in millions) capital (5x Debt/EBITDA Cap) Revolver Capacity…
  19. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 19
    TOP TIER DISTRIBUTION GROWTH & HEALTHY COVERAGE 3Year Expected Distribution Growth Rate and DCF Coverage(1) 40% 1.80x 1.63x 35% 1.44x 1.50x 1.60x 1.46x 1.40x 30% 1.25x 1.25x 1.17x 1.20x 1.21x 1.18x 1.15x 1.10x 1.20x 25%…
  20. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 20
    ATTRACTIVE VALUE PROPOSITION Attractive appreciation potential on a relative basis 8.00% R-squared = .73 7.00% CNNX MWE 6.00% AM - Current WES Yield: 3.37% 5.00% Price: 22.52/unit TEP Yield (%) 4.00% MPLX AM - Implied…
  21. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 21
    Antero Midstream (NYSE: AM) Asset Overview 21
  22. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 22
    ANTERO MIDSTREAM ASSET OVERVIEW Midstream Assets Utica Gathering and compression assets in core of rapidly Shale growing Marcellus and Utica Shale plays Acreage dedication of 428,000 net leasehold acres for gathering and…
  23. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 23
    ANTERO MIDSTREAM ASSETS RICH GAS MARCELLUS Marcellus Gathering & Compression Provides Marcellus gathering and compression services Liquids-Rich gas is delivered to MWEs 1.2 Bcf/d Sherwood processing complex Significant growth…
  24. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 24
    ANTERO MIDSTREAM ASSETS RICH & DRY GAS UTICA Utica Gathering & Compression Provides Utica natural gas and condensate gathering services Liquids-Rich gas delivered into MWEs 800 MMcf/d Seneca processing complex Condensate delivered…
  25. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 25
    ORGANIC GROWTH STRATEGY: BUILD VS. BUY Organic growth strategy provides attractive Organic EBITDA Multiple vs. Precedent Drop Down Multiples returns and project economics, while 11.9x avoiding the competitive acquisition market…
  26. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 26
    ESTIMATED PROJECT ECONOMICS BY SEGMENT AM Option Opportunities Project Economics by Segment(1) 40% 40% 35% 35% Internal Rate of Return 30% 30% 25% 25% Wtd. Avg. 23% IRR 25% 25% 20% 20% 20% 15% 15% 15% 10% 10% 0% LP HP…
  27. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 27
    AM UPSIDE OPPORTUNITY SET ACTIVITY CURRENTLY DEDICATED TO AM Option to acquire at fair market value 100% of ARs water Integrated Water Business business dedicating 559,000 net acres, including ROFO on future services; private letter…
  28. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 28
    AM OPTION INTEGRATED WATER BUSINESS Currently owned by AR who recently received a Private Letter Ruling (PLR) from the IRS regarding qualifying income AM holds option to purchase 100% of water business at fair market value Antero has…
  29. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 29
    REGIONAL PIPELINE PROJECT Regional Gathering Pipeline Option to Acquire Up To 15% Non-Op Equity Interest Throughput Capacity: 1.4 Bcf/d Pipeline 50 miles of 36 inch pipeline Specifications: Project Capital: 400 Million In-Service…
  30. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 30
    PROCESSING VALUE CHAIN POTENTIAL FOR UNDEDICATED ACREAGE Antero Resources has 11.6 Tcf of processable gross 3P gas reserves and 616 Million Bbls of gross 3P NGL reserves across 128,500 gross processable Marcellus acres that are…
  31. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 31
    LARGE UTICA SHALE DRY GAS POSITION Antero spud its first dry gas Utica well in 3Q 2015 Utica Shale Dry Gas Acreage in OH/WV/PA(1) Antero has 224,000 net acres of exposure to Utica dry gas play Rice Hess Chesapeake Bigfoot 9H…
  32. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 32
    CATALYSTS 1 AM Sponsor is the most active operator in Appalachia; 40%+ production Sponsor Production growth targeted for 2015 supported by 1.8 billion capital budget, firm Growth Profile processing and takeaway, long-term natural gas…
  33. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 33
    TOP TIER DISTRIBUTION GROWTH Antero Midstream is targeting 28% to 30% annual distribution growth through 2017 Distribution Per Unit(1) 0.50 0.45 0.40 0.35 0.30 0.25 0.20 0.19 0.18 0.17 0.15 0.10 0.05 0.00…
  34. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 34
    APPENDIX 34
  35. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 35
    LARGEST FIRM TRANSPORTATION AND PROCESSING PORTFOLIO IN APPALACHIA Antero Long Term Firm Processing & Takeaway Position (2018) Accessing Favorable Markets Chicago(1) Mariner East II (0.04) / 62 MBbl/d Commitment (0.06) Marcus Hook…
  36. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 36
    CURRENT NGL MARKETING GEOGRAPHICALLY DIVERSE MarkWest currently processes all of Anteros rich gas and markets all NGLs Mariner East II 61,500 Bbl/d AR Commitment(1) 4Q 2016 In-Service (2) 2015 NGL Marketing by Region…
  37. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 37
    NGL EXPORTS AND NETBACKS STEP-UP BY 4Q 2016 Upon in-service of Mariner East II, Antero will have the ability to market its propane and n-butane to international buyers, providing uplifts of 0.14/Gal and 0.12/Gal, respectively, to the…
  38. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 38
    WORLD CLASS MARCELLUS SHALE DEVELOPMENT PROJECT 100% operated RJ SMITH PAD Operating 7 drilling rigs including BEE LEWIS PAD 30-Day Rate 2 intermediate rigs 30-Day Rate 4-well combined 4-well combined 30-Day Rate of 410,000 net…
  39. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 39
    MARCELLUS ROR% AND GAS PRICE SENSITIVITY Large portfolio of Highly-Rich Gas/Condensate to Dry Gas locations Focused on drilling highly economic rich gas locations rig symbols represent current rig location by Btu regime Assumes…
  40. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 40
    WORLD CLASS OHIO UTICA SHALE DEVELOPMENT PROJECT 100% operated Cadiz Operating 4 drilling rigs Processing Plant 149,000 net acres in the core rich gas/ condensate window (71% includes processable rich gas assuming an 1100 Btu…
  41. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 41
    UTICA OHIO ROR% AND GAS PRICE SENSITIVITY Large portfolio of Condensate to Dry Gas locations Focused on drilling highly economic rich gas locations rig symbols represent current rig location by Btu regime Assumes 12/31/2014 WTI strip…
  42. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 42
    AR COMPLETION DEFERRALS 2016 VOLUME IMPACT Plan to defer 50 Marcellus well completions into 2016 to achieve higher gas price realizations, approximately half of which are located on AM areas of dedication Regional gathering pipeline…
  43. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 43
    ANTERO MIDSTREAM 2015 GUIDANCE Key Operating & Financial Assumptions(1) Key Variable 2015 Guidance Adjusted EBITDA (MM) 150 - 160 Distributable Cash Flow (MM) 135 - 145 Year-over-Year Distribution Growth(2) 28% - 30% Low Pressure…
  44. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 44
    ANTERO RESOURCES UPDATED 2015 GUIDANCE Key Operating & Financial Assumptions Key Variable 2015 Guidance Net Daily Production (MMcfe/d) 1,400 Net Residue Natural Gas Production (MMcf/d) 1,175 Net Liquids Production (Bbl/d) 33,000 Net…
  45. Citigroup MLP and Midstream Infrastructure Conference – Antero Midstream Partners Lp – slide 45
    MAINTENANCE CAPITAL METHODOLOGY Maintenance Capital Calculation Methodology Estimate the number of new well connections needed during the forecast period in order to offset the natural production decline and maintain the average…

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