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2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P.

Sunoco Logistics Partners L.P. · Aug 18, 2016 · 72 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 1
    Sunoco Logistics Partners L.P. NYSE Citi MLP/Midstream SXL Infrastructure Conference August 17-18, 2016
  2. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 2
    Sunoco Logistics Assets Note: Bakken Pipeline is expected to start up in 2016. 3
  3. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 3
    Sunoco Logistics and Energy Transfer Assets Note: Bakken Pipeline is expected to start up in 2016. 4
  4. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 4
    Energy Transfer Family of Companies LP Interest, GP Interest, IDRs ENERGY TRANSFER EQUITY, L.P. GP Interest, IDRs (NYSE: ETE) LP Interest, Class H Units(1) GP Interest, IDRs LP Interest, GP ENERGY TRANSFER ENERGY TRANSFER SUNOCO…
  5. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 5
    Highlights Strong First Half Performance in Difficult Macro Environment: 594MM Adjusted EBITDA and 456MM Distributable Cash Flow As expected, substantially all of the 60MM favorable LIFO crude accounting reported in 1Q16 earnings…
  6. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 6
    Highlights Capital Projects: Revised 2016 Capital Guidance to 1.4B (Reduced from 2.5B) Commenced operations on the Delaware Basin Extension & Permian Longview and Louisiana Extension crude oil pipeline projects Announced the sale of…
  7. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 7
    LIFO Crude Accounting Simplified Conceptual Example Quarter A Quarter B Quarter C Quarter D Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Sale 1 Sale 7 Purchase Purchase 1 7 Sale 2 Sale 6 Purchase…
  8. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 8
    LIFO Inventory Accounting Crude, NGL & RP (amounts in millions) YoY 2016 2015 Variance First Quarter 52 (25) 77 Second Quarter (57) 25 (82) Year to Date - June (5) - (5) Timing of LIFO inventory accounting resulted in…
  9. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 9
    EBITDA by Segment (MM) 2011 2012 2013 2014 2015 Crude Oil 431 612 701 669 656 Natural Gas Liquids 42 81 73 203 333 Refined Products 100 117 97 99 164 Total EBITDA 573 810 871 971 1,153 More diversified portfolio driven by committed,…
  10. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 10
    Adjusted EBITDA: Ratable and Market Related 1,400 Maximize asset base by 1,200 1,153 taking advantage of 971 market opportunities 1,000 Adjusted EBITDA (MM) 871 810 800 Distributions based on 600 573 ratable cash…
  11. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 11
    16 Successful Major Projects Major Organic and Joint Venture Projects: 3 West Texas Crude expansion projects (crude oil) Permian Express 1 (crude oil) Permian Express 2 (crude oil) Eaglebine Express (crude oil) Granite Wash…
  12. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 12
    Scheduled Project Start-up 13
  13. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 13
    Crude Market Summary
  14. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 14
    Dated Brent Daily Price 2008 Present 15
  15. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 15
    World Oil Supply and Demand (2014 Versus 2013) Source: PIRA 16
  16. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 16
    World Oil Supply and Demand (2015 Versus 2014) UPDATE Source: PIRA 17
  17. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 17
    World Oil Supply and Demand (2016 Versus 2015) Source: PIRA 18
  18. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 18
    World Oil Supply and Demand (2017 Versus 2016) Source: PIRA 19
  19. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 19
    Oil Demand and Supply
  20. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 20
    Annual GDP Growth by Key Area, % Source: PIRA 21
  21. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 21
    World Oil Demand Growth (2013 - 2017) Source: PIRA 22
  22. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 22
    Non-OPEC Supply Growth (2013 - 2017) U.S. drives supply growth to a decline in 2016 and freeze in 2017 Source: PIRA 23
  23. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 23
    Latest EIA Weekly U.S. Crude Oil Production Data Source: Energy Information Administration 24
  24. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 24
    U.S. Production Permian, Bakken, & Eagle Ford Source: Energy Information Administration 25
  25. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 25
    OPEC Crude Production (MMB/D) 2015 2016 2017 Saudi Arabia 10.1 10.2 10.2 Kuwait/UAE 5.6 5.9 6.0 Iraq 4.0 4.3 4.5 Iran 2.9 3.4 3.6 Libya 0.4 0.4 0.4 Other OPEC 9.4 8.8 8.9 Total 32.4 33.1 33.7 Source: PIRA 26
  26. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 26
    OPEC Spare Capacity at Historic Lows Source: PIRA 27
  27. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 27
    Overall Crude Market Summary Low Prices caused a supply response as expected The US Shale decline is happening right now Other non OPEC could have larger, longer lasting impacts OPEC market share needs to grow Highest OPEC…
  28. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 28
    Permian Basin
  29. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 29
    United States Midcontinent Crude Production Growth (MBPD) 2013 2014 2015 2016 2017 2018 2019 2020 North Dakota (Bakken) 195 225 95 -150 -95 30 45 50 Eagle Ford 405 385 125 -265 -80 370 255 180 Permian Basin 160 285 245 55 60 275 275…
  30. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 30
    Permian Production By Year (MB/D) Actual Projected 3,200 2,820 2,800 2,555 2,400 2,280 Production 2,005 2,000 1,945 1,890 1,645 1,600 1,360 1,200 1,200 1,050 800 400 11 12 13 14 15 16 17 18 19 20 Year…
  31. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 31
    Nederland Terminal / Crude Projects
  32. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 32
    Nederland Terminal 25 MMB Crude and NGL terminal Pipeline connected to most major crude pipelines and Mt Belvieu NGL Export Capability Crude Export Capability Connected to SPR 33
  33. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 33
    Crude Projects: 9 Successful Open Seasons 3 West Texas Crude Expansions Granite Wash Extension Permian Crude to multiple markets Granite Wash Crude to multiple markets 2012 - 2014 4Q 2014 Permian Express 1 Permian Crude to…
  34. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 34
    Crude Projects: 11 Successful Major Projects Bakken Pipeline Joint Venture End of 2016* ** Bayou Bridge Joint Venture 2Q 2016 *Expected Start-up Committed Fee-based Income **On August 2, 2016 the Partnership…
  35. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 35
    NGL Market Outlook
  36. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 36
    NGLs: U.S. as Big as Next 4 Largest Countries Combined Source: PIRA 37
  37. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 37
    US Ethane Penetrating the European Market First movers (Mariner East) Ineos crackers in Rafnes, Norway and Grangemouth, Scotland Borealis cracker in Stenungsund, Sweden Recent Development Announced in November 2015 Shell / Exxon…
  38. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 38
    Global Steam Cracker Feeds There is currently 5 MMBPD of Naphtha feeding steam crackers Source: PIRA 39
  39. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 39
    Ethylene Cracking Capacity (January 2016) MM Tons % of Market U.S./Canada 33.5 20.5% Europe 25.2 15.4% Latin America 7.2 4.4% Africa/Middle East 32.3 19.8% China 22.5 13.8% SE Asia 24.3 14.9% Other Asia 13.6 8.3% FSU 4.7…
  40. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 40
    NGL Projects
  41. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 41
    Mariner Franchise: 4 Successful Open Seasons Mariner East 1 Ethane / Propane from Houston to Marcus Hook 4Q 2014** Mariner West Ethane from Houston to Sarnia 4Q 2013 Mariner South Mariner East 2 Propane / Butane from Mont…
  42. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 42
    Mariner East Capacity 70 MB/D for ME 1 Initial Capacity 275 MB/D for ME 2 Connecting to 4 Fractionator Upside Capacity 800 MB/D for Mariner East Origin Locations in the Basin World-Class NGL Facility at Marcus Hook Industrial…
  43. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 43
    Mariner East Service Update ME 1 started up propane End of 2014 (30 MBPD, 7 months early) ME 1 ethane Shipments to Marcus Hook commenced 1Q 2016 ME 2 scheduled for 2Q 2017 ME 2X is in open season soliciting interest Marcus…
  44. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 44
    Marcellus / Utica NGL Forecast Source: Bentek 45
  45. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 45
    Marcus Hook Industrial Complex Mariner Infrastructure 46
  46. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 46
    Marcus Hook Terminal Build-Out 47
  47. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 47
    Northeast Platform 48
  48. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 48
    PDH at Marcus Hook In Development
  49. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 49
    Global Propylene Supply and Demand - Global Propylene market is expected to grow by 33MM Metric Tons by 2020 - Lighter feed to crackers - PDH is a preferred choice 50
  50. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 50
    Propylene Supply and Demand 51
  51. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 51
    Balance Sheet and Revolver
  52. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 52
    Capitalization (MM) As of 06/30/16 Debt Senior Notes, net 4,800 fixed 2.5 B SXL Revolver (matures March 2020)(2) 1,263 floating Cash Debt 6,063 Unamortized fair value adjustments (1) 87 Unamortized Bond Discount (38) Total…
  53. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 53
    Debt Maturity Schedule at 07/31/2016 (MM) Note: Excludes borrowings under the revolver. 54
  54. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 54
    2.5 Billion Revolving Credit Facility (MM) (1) Citibank is the administrative agent for the 2.5 billion revolver 55
  55. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 55
    Summary
  56. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 56
    Key SXL Takeaways Recent History Strategic Focus on Crude and Natural Gas Liquids First Mover First West Texas crude projects on line since the shale boom First Marcellus propane project offering local, regional & international…
  57. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 57
    Key SXL Goals / Takeaways Going Forward Commitment to Growth New phase of growth in processing at Marcus Hook Opportunities within the Energy Transfer family M&A - Actively looking for right, strategic opportunities…
  58. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 58
    Key SXL Goals / Takeaways Investment Grade Commitment Investment Grade Credit Ratings S&P: BBB / A-2 Moodys: Baa3 / P-3 Fitch: BBB / F-2 Commitment to Investment Grade credit rating Excellent balance sheet for future growth…
  59. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 59
    Appendix
  60. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 60
    Joint Venture Ownership Consolidated JV's: Mid-Valley Inland Price River Terminal SXL 91.0% SXL 83.8% SXL 55.0% Chevron 9.0% Citgo 16.2% Non-Controlling Interest 45.0% Equity Interest JV's: Explorer* Wolverine** Yellowstone West…
  61. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 61
    Crude Oil Map * *On August 2, 2016 the Partnership announced an agreement to sell 49% of its equity interest in the Bakken Pipeline Project. Upon closing, which is expected to occur in the third quarter of 2016, SXL will own…
  62. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 62
    Crude Oil Segment Highlights 57% of total EBITDA for the twelve months ended December 31, 2015 Approximately 5,900 miles of crude oil trunk and gathering lines located in the Southwest and Midwest U.S. Controlling interest in…
  63. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 63
    Natural Gas Liquids Map Note: Mariner East 2 Pipeline is not currently operational 64
  64. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 64
    Natural Gas Liquids Segment Highlights 29% of total EBITDA for the twelve months ended December 31, 2015 Approximately 900 miles of NGLs pipelines, primarily related to our Mariner systems in the Northeast and Southwest U.S. Marcus…
  65. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 65
    Refined Products Map 66
  66. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 66
    Refined Products Segment Highlights 14% of total EBITDA for the twelve months ended December 31, 2015 Approximately 1,800 miles of refined products pipelines, located in the Northeast, Midwest and Southwest U.S. Controlling Interest…
  67. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 67
    Organic Expansion Capital 68
  68. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 68
    Acquisitions Note: SXL does not comment on future acquisitions 69
  69. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 69
    SXL Non-GAAP Financial Measures (MM) 2011 2012 2013 2014 2015 Net Income 322 531 474 300 397 Interest expense, net 89 79 77 67 134 Depreciation and amortization expense 86 139 265 296 382 Impairment charge 31 9 - - - Non-cash…
  70. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 70
    Historical Financial Results (MM) 2011 2012 2013 2014 2015 Crude Oil 431 612 701 669 656 Natural Gas Liquids 42 81 73 203 333 Refined Products 100 117 97 99 164 Total Adjusted EBITDA 573 810 871 971 1,153 Interest expense, net…
  71. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 71
    SXL Key Financial and Operating Statistics 2012 2013 2014 2015 2016 Total Total 1st 2nd 3rd 4th Total 1st 2nd 3rd 4th Total 1st 2nd Total Financial highlights (in millions) Sales and other operating revenue Crude Oil 12,526 15,953…
  72. 2016 Citi MLP Midstream Infrastructure Conference – Sunoco Logistics Partners L.P. – slide 72
    SXL Key Financial and Operating Statistics 2012 2013 2014 2015 2016 Total Total 1st 2nd 3rd 4th Total 1st 2nd 3rd 4th Total 1st 2nd Total Reconciliation of Segment Operating Income to Net Income Attributable to Sunoco Logistics…

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