GROWTH HIGH GROWTH MIDSTREAM THROUGHPUT Antero Midstream is targeting 28% to 30% annual distribution growth through 2017 AM has delivered on those targets to-date with DCF coverage of 1.60x in the latest quarter Distribution Per Unit…
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…
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 Appalachian Producers by Proved…
SPONSOR STRENGTH MOST ACTIVE OPERATOR IN APPALACHIA COMBINED TOTAL 12/31/15 RESERVES Assumes Ethane Rejection Net Proved Reserves 13.2 Tcfe Net 3P Reserves 37.1 Tcfe Strip Pre-Tax 3P PV-10(1) 11.2 Bn Net 3P Reserves & Resource 50…
GROWTH HIGHEST GROWTH LARGE CAP E&P Anteros 40%+ production growth guidance for 2015 leads the U.S. large cap E&P industry and drives AM growth(1) 45% 40%+ 35% 27.4% 26.3% 26.2% 25% 22.8% 19.7% 15.2% 15% 12.5% 11.7%…
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 as of 12/31/2014 Antero controls an estimated 37% of the NGLs in the liquids-rich…
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…
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%…
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 MMBtu/d AR Gross Gas…
HEDGING INTEGRAL TO BUSINESS MODEL Hedging is a key component of Anteros business model which includes development of a large, repeatable drilling inventory Locks in higher returns in a low commodity price environment and reduces well…
VALUE CHAIN OPPORTUNITY FULL MIDSTREAM VALUE CHAIN Well Pad Condensate Gathering End Stabilization Users (Miles) YE 2014 YE 2015E Compression (Miles) YE 2014 YE 2015E Utica 16 19 Marcellus 62 76 Low Pressure Gathering Utica 35…
STRONG FINANCIAL POSITION STRONG BALANCE SHEET AND FLEXIBILITY Antero Resources (NYSE:AR) Antero Midstream (NYSE:AM) 9/30/2015 Debt Liquid Non-E&P Assets 9/30/2015 Debt Liquid Assets Debt Type MM Asset Type MM Debt Type MM Asset Type…
STRONG FINANCIAL POSITION SIGNIFICANT FINANCIAL FLEXIBILITY AM Liquidity (9/30/2015) Financial Flexibility 1.5 billion revolver in place to fund future growth capital ( in millions) (5x Debt/EBITDA Cap) Revolver Capacity 1,500…
TOP TIER DISTRIBUTION GROWTH & HEALTHY COVERAGE 3Year Expected Distribution Growth Rate and DCF Coverage(1) 30% 2.00x 1.8x 1.80x 25% 1.6x 1.5x 1.6x 1.60x 1.3x 1.2x 1.40x 1.2x 20% 1.2x 1.2x 1.3x 1.20x 1.0x 15% 1.00x…
ATTRACTIVE VALUE PROPOSITION Attractive appreciation potential on a relative basis 10% 9% CNNX R-squared = .83 8% MWE 7% 6% AM - Current Yield: 3.18% Yield (%) WES Price: 23.87 5% TEP 4% MPLX AM - Implied Yield:…
Antero Midstream (NYSE: AM) Asset Overview 21
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 434,000 net leasehold acres for gathering and…
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…
ANTERO MIDSTREAM ASSETS RICH & DRY GAS UTICA Utica Gathering & Compression Provides Utica gathering and compression services Liquids-rich gas delivered into MWEs 800 MMcf/d Seneca processing complex Condensate delivered to…
ANTERO INTEGRATED WATER BUSINESS AM acquired ARs integrated water business for 1.05 billion plus earn out payments of 125 million at year-end in each of 2019 and 2020 The acquired business includes Anteros Marcellus and Utica…
ADVANCED WASTEWATER TREATMENT Antero has contracted with Veolia to integrate an advanced wastewater treatment complex into its water business Advanced Wastewater Treatment Illustrative Produced & Flowback Water Volumes Veolia will…
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…
AM UPSIDE OPPORTUNITY SET ACTIVITY CURRENTLY DEDICATED TO AM Option to participate for up to 15% in regional gathering pipeline project in West Virginia expected to go in-service Regional Pipeline Project in 4Q 2015 Additive to full…
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…
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…
LARGE UTICA SHALE DRY GAS POSITION Utica Shale Dry Gas Acreage in OH/WV/PA(1) Antero has completed its first dry gas Utica well a 6,620 Chesapeake Rice Hess lateral in Tyler County, WV Bigfoot 9H Porterfield 1H-17 Hubbard BRK 3H…
CATALYSTS 1 AM Sponsor is the most active operator in Appalachia; 40%+ production High Growth Sponsor growth targeted for 2015 supported by 1.8 billion capital budget, firm Production Profile processing and takeaway, long-term natural…
APPENDIX 34
WATER DROP DOWN COMPLETED Transaction Specifics Anteros Marcellus and Utica freshwater delivery business, the fully contracted future ASSETS: advanced wastewater treatment complex and 20-year agreement to cover all fluid handling and…
MVCS SUPPORT AND EARN OUTS DRIVE RETURNS Minimum volume commitments (MVCs) on fresh water delivery volumes, at 3.68 and 3.63 per barrel for the Marcellus and Utica, respectively (with CPI adjustments), support revenues and rates of…
IMPACT OF DROP DOWN TRANSACTION ON ANTERO FINANCIAL STATEMENTS Pre-Drop Down Pro Forma Drop Down Antero Resources Antero Resources Antero Midstream Metrics (Consolidated) (Consolidated) Partners N/A - Eliminated Upon N/A - Eliminated…
LARGEST FIRM TRANSPORTATION AND PROCESSING PORTFOLIO IN APPALACHIA Anteros natural gas firm transportation (FT) portfolio builds to 4.85 Bcf/d by YE 2018 with 87% serving favorable markets, with an average demand fee of 0.40/MMBtu and…
NORTHEAST NGLS ARE TRANSPORTATION CHALLENGED Not so much a supply problem but more of a logistics problem for NGLs in the northeast today The majority of northeast NGL production is being transported by expensive rail and trucking NGLs…
NORTHEAST NGL GROWTH IS SUPPORTED BY INCREASING TAKEAWAY OPTIONS NGL transportation rates are expected to decline 0.12 to 0.15 per gallon by 2017 as pipeline options to domestic markets and export terminals go in-service (Mariner East…
U.S. EXPORTS ARE SUPPORTED BY EXCESS DOCK CAPACITY AND FLEET GROWTH LPG transportation rates from northeast fractionation to Europe and Asia should improve by 0.05 to 0.15 per gallon by YE 2016, driven both by pipelines replacing rail…
2015 GLOBAL LPG DEMAND Global LPG demand is 8.5 MMBbl/d and growing 42
POSITIVE OUTLOOK FOR LONG-TERM NGL MARKETS Forecast global LPG demand growth of 800 MBbl/d to 1 MMBbl/d by 2020 to be driven by petrochem projects in Asia and Middle East as well as residential/commercial, alkylate and power generation…
GLOBAL LPG DEMAND DRIVEN BY PETCHEM AND RES/COMM Largest end-use sectors for LPG are residential/commercial, which tends to grow with population and improvement in living standards in the emerging markets PIRA forecasting 1.0 MMBbl/d…
GLOBAL LPG TRADE DRIVEN BY U.S. SHALE The U.S. is the largest single driver of the rapid expansion in LPG trade accounting for over 90% in trade growth MMBbl/d 5.2 4.6 3.9 3.3 2.6 2.0 United States 1.3 0.7 1.…
U.S. SHALE NGL EURS SUPPORT LPG TRADE GROWTH U.S. shale play NGL reserves are 50.8 billion barrels (1) Eagle Ford, Marcellus, Utica, Bakken and Permian are the work horses of U.S. shale production growth Marcellus/Utica NGL resource…
POSITIVE OUTLOOK FOR LONG-TERM ETHANE MARKETS AS WELL U.S. ethane demand is projected to increase at an annual 3.5% CAGR through 2020, primarily based on an 8% CAGR for U.S. petrochem demand and a 30% growth in exports primarily to…
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…
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…
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…
ANTERO RESOURCES EBITDAX RECONCILIATION EBITDAX Reconciliation ( in millions) Quarter Ended LTM Ended 9/30/2015 9/30/2015 EBITDAX: Net income (loss) including noncontrolling interest 544.7 1,413.4 Commodity derivative fair value…
ANTERO MIDSTREAM EBITDA RECONCILIATION EBITDA Reconciliation Three months ended September 30, 2014 2015 Reconciliation of Net Income to Adjusted EBITDA and Distributable Cash Flow: Net income 34,290 42,648 Add: Interest expense 2,455…
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