LAKE CHARLES LNG Analyst Day Presentation November 18th, 2014
LAKE CHARLES LNG Liquefaction transforms Lake Charles LNG, LLC (LC LNG) into a bi-directional facility capable of exporting and importing LNG Liquefaction will operate as Lake Charles LNG Export Company, LLC (LCL) LCL would add three…
UNDERLYING PROJECT RATIONALE US Gas: The U.S. is an attractive source of gas to BG as Tolling Customer because it provides: Large existing natural gas production base with high visibility of future supply Access to an LNG cost…
ADVANTAGED PROJECT SITE Brownfield site offers development advantages Liquefaction opportunity at a fraction of a greenfield site cost The liquefaction and regasification facilities will be operated as a single integrated facility…
ADVANTAGED PROJECT SITE Pipeline Access The Project site is located in a pipeline alley, close to Henry Hub, with access to many of the largest natural gas production areas in the United States The Existing Terminal is connected to the…
TGC PIPELINE MODIFICATIONS Transport BG Natural Gas 2.6 Bcf/d to LCL Managed by TGC, wholly owned by ETP Uses existing pipelines + upgrades 11.6 miles 42-inch NG pipeline 6.5 miles 24-inch NG pipeline loop Additional Compression…
DOE EXPORT PERMIT The export of LNG produced by the Project from the United States will be undertaken by BG under long-term export authorizations issued by the U.S. Department of Energy (DOE) to Lake Charles Exports, LLC Lake Charles…
GENERAL REGULATORY STATUS FERC March 25, 2014 Application submitted to the FERC to authorize the construction and operation of the Project Approval requested by April 1, 2015 Notice of Schedule of Environmental Review expected to be…
EPC TIMELINE 2013 2014 2015 Bid Contract EPC Contractor Bid Preparation Evaluation Negotiation FEED Engineer Selected Class III Estimate EPC Contractor Preferred EPC Contract Full (Technip) Completed Bids Received EPC Contractor…
LAKE CHARLES LNG ON TRACK FOR FINAL INVESTMENT DECISION IN MID-2015 Train 1 Regulatory Path FID In-Service mid- DOE FTA & non-FTA Approvals EPC Finalization 2019 FERC Pre-Filing & Application Commercial Agreements Finalized Q4 14…
ROBUST COMMERCIAL STRUCTURE 25 year tolling arrangement under which LCL will provide liquefaction services to BG Technology Technology Reservation fee payments from BG commence License Licensor upon achieving commercial operation…
FINANCING ASSUMPTIONS Project costs of 9.6 billion unlevered (actual expected cost), resulting in 11.85 billion in total funded cost Project expected to be financed 70% / 30% debt/equity 1.0 billion of cash equity contribution 3rd…
SOURCES AND USES ( in millions) Sources of funds Amount Percent Uses of funds Amount Percent Cash Equity Contribution 1,000 7.6% Project Costs 9,600 73.3% Cash Flows From Trains 1 and 2 1,478 11.3% Debt service reserve funding 332…
FINANCING ASSUMPTION COMPARISON Analyst Day 2013 Analyst Day 2014 Unlevered Project Cost 9.2 Bn 9.6 Bn Cash Equity Contribution 1.6 Bn 1.0 Bn Debt 8.4 Bn 9.38 Bn Debt Amortization 35 yrs (10yrs post base contract term) 25 years…
LC LNG REGAS CASH FLOW SUMMARY THROUGH 2020: TAKE OR PAY CONTRACTS WITH BG RSA/IEP EBITDA ( in millions) 193 195 186 185 171 2012 2013 2014 2015 2016-2020 No debt at LC LNG: Balance sheet is unlevered Improved cash…
KEY CREDIT STRENGTHS LNG based on Henry Hub gas prices is competitive with oil-linked contracts (particularly for supply Compelling Industry Fundamentals to Asia) Favourable location for gas supply Low cost development due to…
ET LNG
CURRENT LAKE CHARLES STRUCTURE ETE 100% 60% ETP ET LNG 40% LCL1 LC LNG 2 1 This entity is pursuing the Lake Charles liquefaction project 2 This entity owns and operates the existing Lake Charles regasification…
LCL CONTRIBUTION TO ET LNG (a) (b) Exchange Exchange ETE and ETP Contribute Class A Units of ET ET LNG issues Class 3rd Party LCL to ET LNG LNG issued to ETE B Units to 3rd Party Investor(s) and ETP Investor(s) Contribute Cash Equity…
EXPECTED POST FID LNG OWNERSHIP STRUCTURE Public ETE Public BG to own 1% interest in LC LNG and LCL Common, ET LNG Subordinated Public GP & A Units ETP BG to contribute capital for 3rd Party its 1% interest Investors GP…
POSSIBLE DISTRIBUTABLE CASH FLOW IMPROVEMENTS Less Cash Equity Required Strong DSCR Conservative capitalization structure Lower 3rd Party Equity Investor Returns Benefit from Regas Cash Flow / Common Facility fees Enhanced…
COST COMPETITIVE NATURE OF LAKE CHARLES
GLOBAL LNG PROJECT COST COMPARISON Downstream (liquefaction) costs (/t) by project by year Current BG Off-take Current BG Off-take (US) LCL US LNG Plants Freeport Cove Point Cameron LCL Lake Charles will be a…
LNG AND GAS PRICES **Australian LNG Projects Breakeven 13-14 *Estimated LCL Landed Cost to Asia *LC estimated range from ET based on Platts and Wood Mackenzie data 26 **Australian LNG Project breakeven prices from…
LNG TRADE OUTLOOK TO 2025 27
ENERGY TRANSFER EQUITY, L.P. 2014 Analyst Day November 18th, 2014
ENERGY TRANSFER FAMILY ENERGY TRANSFER EQUITY, L.P. (NYSE: ETE) Parent Company 8.7% LP Interest, 23.1% LP Interest, 50.16 million 1.0% GP Interest LP, GP and IDR 0.7% GP Interest, Class H Units (1) & IDRs interests & IDRs 30.4%…
SIGNIFICANT FINANCIAL SCALE AND DIVERSIFICATION ACROSS THE FAMILY Enterprise Value of Approximately 100 billion Relative Unit Price Performance since Jan 1, 2013 Energy Transfer Equity, L.P. (NYSE: ETE) ETE ETP SXL RGP SUN ETE:…
BUSINESS OVERVIEW Energy Transfer Equity (ETE), a pure-play general partner (GP), is an MLP that receives all of its cash flow from limited partner interests, GP interests and incentive distribution rights (IDRs) in Energy Transfer…
A TRULY UNIQUE FRANCHISE Natural NGLs Crude Gas Oil 3rd largest G&P 2nd largest 3rd largest MLP 4th largest NGL 2nd largest planned Leading non-refining player and transporter of transporter of business LNG Export gasoline…
SHALE BASIN PRODUCTION GROWTH ALIGNED WITH OUR OPERATING ASSETS Operating Assets Combined Sunoco Retail Platform (1) Company Operated ETP Assets SXL Assets RGP Assets , Dealer / Distributor Operated Crude Production (Mbpd)…
EXPOSURE TO MANY OF THE MOST PROFITABLE SHALE PLAYS IN THE U.S. Internal Rate of Return (IRR%) Current Strip(1) NYMEX Breakeven Price (/MMbtu 15% ATAX IRR)(2) Utica - Wet Gas Haynesville/Bossier Shale - NE TX Marcellus Shale - Super…
EXCEPTIONALLY WELL POSITIONED TO CAPITALIZE ON U.S. ENERGY EXPORTS Asset base well-positioned to capture the changing supply and demand dynamics for condensates, natural gas, NGLs and LNG Canada Europe NGLs LNG Natural Gas…
TRANSFORMATION AND CONTINUED GROWTH ETP Adjusted Propane Midstream Intrastate Interstate NGL Retail Crude All other EBITDA by Operating 7% 12% Segment 15% 18% 21% 11% ( in millions) 14% 2009 LTM 53% 1,477 12% 25% 4,533 12% SXL…
STRONG, DIVERSIFIED OPERATING BUSINESSES ARE THE KEY ETE currently receives significant cash flow from Lake Charles LNG and through its LP, GP and IDR interests in ETP, RGP and SXL Lake Charles ( in millions) Class H SXL GP + IDRs…
A BALANCE OF ORGANIC DEVELOPMENT AND ACQUISITIONS HAVE DRIVEN OUR GROWTH ACROSS THE FAMILY RGP SXL ETP 1.20 38
THE NEW FRONTIER FOR GROWTH IS HERE Board Approved Organic Growth Projects Next Chapter Further Growth 12 M&A Billion Lake Charles 20 Capital Billion RGP SXL ETP 39
ILLUSTRATIVE ETE CASH FLOW SNAPSHOT ( millions) 2015E (1) ETP Interests LP 129 2.67 / unit based on 353 million ETP GP + IDR 941 units Distributions from ETP Interest 1,070 (2) RGP Interests LP 123 0.20 / unit based on 404…
INVESTMENT HIGHLIGHTS Facilitate Growth at Underlying MLPs Unique Level of Insider Ownership Continued Preserve Financial Flexibility + Cost of Capital Strong Performance Well Positioned for 2015 and Beyond Lake…
APPENDIX
ETE CREDIT PROFILE No maturities in the next 3 years Weighted average interest rate is 5.0% Capital Structure Maturity Profile ( millions) ( millions) 09/30/14 Cash 9 Senior Notes Term Loan Revolving Credit Facility Revolver…
NET IDR RELINQUISHMENTS TO ETP FROM ETE ( millions) 2014 2015 2016 2017 2018 2019 Total (1) Net IDR Relinquishments (124) (86) (107) (85) (80) (70) (552) Management Fees (95) (95) (5) (195) Total (219) (181) (112) (85) (80)…
LAKE CHARLES LNG COMPANY, LLC NON-GAAP RECONCILIATIONS Three Months Ended Nine Months Ended (MM) September 30, 2014 September 30, 2014 Revenues 55 162 Operating expenses (5) (13) Selling, general and administrative expenses (1)…
ENERGY TRANSFER PARTNERS, L.P. NON-GAAP RECONCILIATIONS Twelve Months Ended December 31, (MM) 2009 2010 2011 2012 2013 3Q14 (1) LTM (1) Net income 791 617 697 1,648 768 447 1,046 Interest expense, net of interest capitalized 395…
ENERGY TRANSFER EQUITY, L.P. NON-GAAP RECONCILIATIONS (MM) Twelve Months Ended December 31, 2010 2011 2012 2013 3Q14 LTM (1) ETP GP distributions 396 441 459 522 139 466 ETP LP distributions 191 180 180 268 30 133 ETP distributions…
SUNOCO LOGISTICS PARTNERS L.P. NON-GAAP RECONCILIATIONS Twelve Months Ended December 31, (MM) 2009 2010 2011 2012 2013 3Q14 LTM Net Income 250 348 322 531 474 157 530 Interest expense, net 45 73 89 79 77 14 70 Depreciation and…
REGENCY ENERGY PARTNERS LP NON-GAAP RECONCILIATIONS Three Months Ended September 30, 2014 2013 ( in millions) Net income 107 42 Add (deduct): Interest expense, net 86 41 Depreciation, depletion and amortization 122 74 Income tax…
SUN NON-GAAP PRO FORMA RECONCILIATION (1) (M) 2Q14 Net income 28,602 Interest expense, net of interest capitalized 4,745 Income tax expense (benefit) from continuing operations 1,401 Depreciation and amortization 15,179…
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