CONE Midstream Partners LP Credit Suisse MLP and Energy Logistics Conference June 21, 2016
CNNX offers an attractive investment proposition Strategic Largest dedicated acreage position in core of lowest cost gas play Location Upstream development plan drives organic growth on existing system Visible Growth Large…
CNNX Overview
CONE Midstream Partners LP Brief History & Overview CONE Gathering LLC a 50/50 midstream joint venture Between CONSOL Energy (CNX) and Noble Energy (NBL) (the Sponsors) Formed in 2011 to service their natural gas production in the…
Structured for Significant Organic and Drop-down Growth Potential CONE Midstream Partners LP 75% 5% 5% interest interest interest Organic Growth Drop-down Growth Anchor Systems Growth Systems Additional Systems Established…
Gathering Systems Overview Gathering System Information Pipeline Capacity Compression System (Miles) (Bbtu/d) (HP) Anchor 166 1,329 72,780 Growth 31 860 8,040 Additional 47 545 9,480 Total 244 2,734 90,300 (1) Data as…
Sponsors Hold Strategically Advantaged Position in Marcellus Core Sponsors Hold Approximately 700,000 Net Acres in the Cost-advantaged and Prolific Area of the Marcellus Sponsors 50/50 upstream joint venture in the Marcellus covers…
Marcellus and Utica Are the Most Attractive Economic Gas Plays in North America IRRs by Basin CNNX Focus Areas *Price Deck Used by Credit Suisse for IRR by Basin Calculation Source: Credit Suisse US Energy Logistics / Master…
Operating & Financial Results
Outperformed IPO Projections and On-track to Achieve 2016 Guidance 6 quarters of very strong operating and financial results since IPO o Adj. Net EBITDA Increase of 71% compared to 1Q2015 CNNX Has 2015- raised guidance twice and beat…
1Q2016 Highlights Continued Strong Performance Continued strong growth with increases over prior year (1Q 2015) Revenue (gross) up 44% Net CNNX Volumes up 55% Net Income to CNNX up 74% Adjusted EBITDA (gross) up 75% Adjusted…
North Nineveh Debottlenecking Project has Added Significant Capacity Line looping and new interconnection project located in Washington and Greene Counties System was undersized original design did not accommodate activity growth…
Decline in Unit Operating Expense Has Yielded Significant Cost Savings 0.160 0.140 0.120 Per Mcfe 0.100 0.080 0.060 Continued focus on cost optimization and operating efficiencies 0.040 Unit operating expense net of power…
Distributable Cash Flow Track Record of Steady Growth and Robust Coverage Millions 30 24.6 25 22.4 20 19.5 1.69x Coverage 14.1 14.9 15 10 13.1 13.6 14.1 14.6 12.6 5 0 Q1-2015 Q2-2015 Q3-2015 Q4-2015 Q1-2016…
Strong Distribution Coverage and Leverage are Positive Differentiators for CNNX 2016 Estimates as published by Wells Fargo Equities Research Department 1/29/2016. CNNX data: run-rate 1Q2016 actual to net debt 17
Sustainability: Capacity to Fully Fund 2016 Capital Internally Amounts in millions Year Ending Actual Projected (1 ) Dec 31, 2015 Dec 31, 2016 Distributable Cash Flow (2) 70.9 84.0 Total Cash Distributions (assuming 15% growth in…
Outlook
Strong 2016 Outlook Positions CNNX for Future Growth Guidance ahead of IPO model Strong 2016 Volumes driven by TILs, strong well performance and continued Outlook system optimization High current coverage ratio of 1.69x Large…
2016 Guidance: Robust DCF Growth from Modest Capital Expenditures(1) Daily Throughput Total CNNX Capex Bbtu/d Millions 900 CAGR: 41% 140 800 2012-2015 120 700 100 600 500 80 400 60 119.2 300 629 96.9 40 76.9 30-35 200 452…
Projected 2016-2017 throughput volumes are driven by TILs from DUC inventory Inventory of Wells Drilled But Not Connected Anchor Growth Additional Total Wet Dry Inventory 12/31/15 60 0 62 122 68 54 2016 Well Connections Q1 TIL…
Potential Upside Factors to 2016 Guidance and 2017 Outlook Better Well Performance Additional Debottlenecking Opportunities Incremental Cost Containment and Asset Optimization Asset Dropdowns Third Party Business or…
Systematic analysis of leaseholds identifies potential third-party opportunities CNNX McQuay/Majorsville Area Overlaid on E&P Leaseholds and Permitted Wells 24
Stacked Pay Potential Offers Significant Development and Gathering Efficiencies Stacked Laterals Provide Economies of Scale to Access up to 4 Pays From 1 Pad 25
CNNX is Well Positioned to Service CONSOLs Stacked Utica Position CONSOL has approximately 197,000 net prospective Utica Shale acres in PA and WV. PA/WV Dry Utica well EURs are estimated at 3.0 Bcfe / 1000 feet of lateral Source:…
CNNX: Engineered for Long-term Growth CONE Midstream Has Ample Business Growth Drivers Even in Lower Commodity Price Environment Co-ownership of Development Companies Provides Opportunities for Drop-downs of Sponsors Retained…
Conclusion: CNNX offers an attractive investment proposition Strategic Largest dedicated acreage position in core of lowest cost gas play Location Upstream development plan drives organic growth on existing system Visible Growth…
Appendix
Non-GAAP Financial Measures EBITDA and Adjusted EBITDA We define EBITDA as net income (loss) before net interest expense, depreciation and amortization, and Adjusted EBITDA as EBITDA adjusted for non-cash items which should not be…
CNNX Benefits From its Development Company Structure Provides CNNX with a critical mass of established gathering assets within Anchor Systems Shields CNNX from a substantial portion of the capital requirements, which will…
Third-Party Opportunity Expected from High Concentration of Wells in Close Proximity Wells Permitted & Drilled per County 32
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