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August 2016 Company Update – Kinder Morgan, Inc.

Kinder Morgan, Inc. · Aug 30, 2016 · 36 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. August 2016 Company Update – Kinder Morgan, Inc. – slide 1
    Run for Shareholders, By Shareholders Steve Kean Chief Executive Officer August 30-31, 2016
  2. August 2016 Company Update – Kinder Morgan, Inc. – slide 2
    Unparalleled Asset Footprint Largest Energy Infrastructure Company in North America World class asset footprint: Largest natural gas pipeline network in North America Own an interest in / operate over 69,000 miles of natural gas…
  3. August 2016 Company Update – Kinder Morgan, Inc. – slide 3
    KMI Overview Management Aligned with Investors; 14% Stake in KMI Simple Public Structure Management / Public Original S/H(a) Float Simple Structure: 318MM (14%) 1,921MM (86%) One equity base Kinder Morgan, Inc. One dividend…
  4. August 2016 Company Update – Kinder Morgan, Inc. – slide 4
    Our Strategy Focus on stable fee-based assets that are core to North American energy infrastructure Market leader in each of our business segments Maintaining a strong balance sheet is paramount Our primary investing entity has been…
  5. August 2016 Company Update – Kinder Morgan, Inc. – slide 5
    Capital Invested 54 Billion of Asset Investment & Acquisitions Since Inception(a,c) ( in billions) Total Invested by Type(a,c) Total Invested by Year(b,c) 30 28.8 25.0 11 25 Expansion 20 10 9.8 Acquisition 15 9 10 8 5 - 7…
  6. August 2016 Company Update – Kinder Morgan, Inc. – slide 6
    Returns on Invested Capital Consistent Returns Demonstrate Asset Performance, Management Discipline Segment ROI(a): 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Natural Gas Pipes 13.3% 15.5% 12.9%…
  7. August 2016 Company Update – Kinder Morgan, Inc. – slide 7
    19 Years of Stable Growth Strategy Has Led to Consistent, Growing Results KMP Annual LP DCF per Unit(a) KMI Annual DCF per Common Share 6 5.61 2.50 5.39 5.07 2.14 2.10 4.68 2.00 5 4.43 2.00 4.154.25 1.65 4 3.65 1.46…
  8. August 2016 Company Update – Kinder Morgan, Inc. – slide 8
    2016 Budget Guidance(a) Supported by Diversified, Fee-based Cash Flow 2016 Published Budget DCF of 4.7 billion(b) 2016 declared dividend of 0.50 per share 3.6 billion of cash in excess of dividend Growth capex of 3.3 billion in…
  9. August 2016 Company Update – Kinder Morgan, Inc. – slide 9
    Segment Overview Natural Gas Pipelines 2016 Budgeted Segment 72% interstate pipelines EBDA = 8.0 billion(a) 20% gathering, processing & treating 87% fixed-fee(b) 13% other CO2 S&T KM Canada 8% intrastate pipelines & storage CO2…
  10. August 2016 Company Update – Kinder Morgan, Inc. – slide 10
    KMIs High Quality Cash Flow Not all fee-based cash flow is created equal 2016 Budgeted Segment Composition of 91% EBDA = 8.0 billion(a) Fee-based Cash Flow 3% Commodity- CO2 S&T based 0.3 / Other 6% Hedged 0.5…
  11. August 2016 Company Update – Kinder Morgan, Inc. – slide 11
    Natural Gas Transportation & Storage 57% of KMI 2016 Budgeted Segment EBDA(a) Natural gas transport & storage is KMIs largest business U.S. Natural Gas Supply & Demand(a) (Bcf/d) U.S. natural gas demand expected to rise 35% through…
  12. August 2016 Company Update – Kinder Morgan, Inc. – slide 12
    Liquids Transportation, Storage & Handling 33% of KMI 2016 Budgeted Segment EBDA(a) Strong Fundamentals & Demand Drivers Highlighting Asset Utilization Stable refined products demand: vital pipeline network connecting refinery / port…
  13. August 2016 Company Update – Kinder Morgan, Inc. – slide 13
    Market Update Natural Gas(a) NGLs(b) U.S. natural gas-fired power generation Significant NGL supply growth driving In 2016, SNG recorded its five highest power gen infrastructure development days ever NGL exports projected to be 1.3…
  14. August 2016 Company Update – Kinder Morgan, Inc. – slide 14
    Market Update (Contd) Refined Products(a) Crude Oil Continued steady, modest volume growth Oil price decrease leading to curtailed U.S. production(b) Inflation-based tariff adjustment mechanism U.S. Monthly Oil Production (MMBbl/d)…
  15. August 2016 Company Update – Kinder Morgan, Inc. – slide 15
    KMI Counterparty Exposure Strong Customer Credit Profiles Limit KMIs Risk(a) High-Quality, Diversified Customer Base Estimate approximately 2/3 of revenue(b) generated by end-users (utilities, LDCs, refineries, chemical, large…
  16. August 2016 Company Update – Kinder Morgan, Inc. – slide 16
    5-year Growth Capex Program(a) 13.5B of Attractive, Fee-based Projects World class asset footprint has helped secure growth projects with attractive returns, and secured by long-term, fee-based contracts with creditworthy…
  17. August 2016 Company Update – Kinder Morgan, Inc. – slide 17
    Business Risks Regulatory Products Pipeline FERC rate cases Natural Gas FERC rate cases Legislative and regulatory changes CO2 crude oil production volumes Throughput on our volume-based assets Counterparty credit Commodity…
  18. August 2016 Company Update – Kinder Morgan, Inc. – slide 18
    KMI: Attractive Value Proposition Unparalleled asset footprint Stable, fee-based cash flows Strong and improving investment grade balance sheet 13.5 billion of capital committed to attractive growth projects No need to access…
  19. August 2016 Company Update – Kinder Morgan, Inc. – slide 19
    Appendix
  20. August 2016 Company Update – Kinder Morgan, Inc. – slide 20
    Energy Toll Road Security of Cash Natural Gas Products Kinder Morgan Terminals CO2 Pipelines Pipelines Canada Interstate & LNG: take or pay Liquids & Jones Act: Refined products: S&T: primarily Intrastate: 73% take or pay(a,b)…
  21. August 2016 Company Update – Kinder Morgan, Inc. – slide 21
    Incidents & Releases Liquids Pipeline Right-of-way Liquids Pipelines Liquids Pipelines Incidents per 1,000 Miles(a) Release Rate(a) 1.0 50 Barrels per billion barrel miles 0.8 40 Incidents per 1,000 Miles 0.6 0.57 30…
  22. August 2016 Company Update – Kinder Morgan, Inc. – slide 22
    Incidents & Releases Natural Gas Pipeline Right-of-way Natural Gas Pipelines Natural Gas Pipelines Incidents Rate All Reportable Incidents(a) Incidents Rate Onshore Ruptures-only(c) 1.0 0.5 0.8 0.4 Incidents per 1,000 Miles…
  23. August 2016 Company Update – Kinder Morgan, Inc. – slide 23
    Employee Safety Statistics(a) KM Lost-time Incident Rate (DART) OSHA Recordable Incident Rate 4 3.7 7 Lost-time injuries per 200k hours 6.4 OSHA Recordable Incidents per 6 6.1 200k Hours Worked 3 5 4 worked…
  24. August 2016 Company Update – Kinder Morgan, Inc. – slide 24
    Natural Gas Pipelines Segment Outlook Well-positioned connecting key natural gas resources with major demand centers Long-term Growth Drivers: Shale-driven expansions / extensions LNG exports Liquefaction facilities Pipeline…
  25. August 2016 Company Update – Kinder Morgan, Inc. – slide 25
    Natural Gas Pipelines Contracted Capacity and Term by Region Contracted Avg. Term Region Service Capacity Remaining Storage 356 Bcf 3 yrs., 7 mos. North Transport 19.1 Bcf/d 5 yrs., 7 mos. Storage 52 Bcf 1 yrs., 10 mos.…
  26. August 2016 Company Update – Kinder Morgan, Inc. – slide 26
    Products Pipelines Segment Outlook Stable refined product demand; opportunities for growth from increased liquids production Long-term Growth Drivers: Miles of Pipe: 9,900 Transmix: 5 facilities with process capability of…
  27. August 2016 Company Update – Kinder Morgan, Inc. – slide 27
    Products Pipelines Historical Demand and 2016 EIA Outlook(a) U.S. Refined Product Consumption U.S. Refined Product Demand Outlook 2014 2015 2016E (MMBbl/d) 10 Mogas 0.9% 2.6% 1.1% 9 Distillate 5.5% -1.9% 2.1% 8 Jet Fuel 2.5%…
  28. August 2016 Company Update – Kinder Morgan, Inc. – slide 28
    Terminals Segment Outlook Well-located in refinery / port hubs and inland waterways Long-term Growth Drivers: KM Terminal Facilities* Refined product supply and demand growth Bulk 59 Terminals Gulf Coast liquids exports Liquids…
  29. August 2016 Company Update – Kinder Morgan, Inc. – slide 29
    Terminals Terminals Segment 76% of Terminals 2016 Budgeted Segment EBDA is Liquids-based(a) Terminals 2016 Budgeted Segment EBDA(a) Liquids Revenue(b) 79% of liquids revenues secured by 100% take-or-pay contracts Other Fixed…
  30. August 2016 Company Update – Kinder Morgan, Inc. – slide 30
    Terminals Houston Ship Channel Market: Worlds largest integrated refined product terminaling system Infrastructure: 43 million barrels of capacity connected to 10 refineries Customers: Refiners, integrated majors, international…
  31. August 2016 Company Update – Kinder Morgan, Inc. – slide 31
    CO2 Segment Outlook(a) Own and operate best source of CO2 for EOR Long-term Growth Drivers: Demand for scarce supply of CO2 drives volume and price Expect to maintain current CO2 production levels with minimal incremental…
  32. August 2016 Company Update – Kinder Morgan, Inc. – slide 32
    Kinder Morgan Canada Segment Outlook Sole oil pipeline from Oilsands to West Coast / export markets Long-term Growth Drivers: Expand Oilsands export capacity to West Coast and Asia Following successful open season, major…
  33. August 2016 Company Update – Kinder Morgan, Inc. – slide 33
    2016 Budgeted Growth Capital (millions) 2016 2015 (a) Growth capital Forecast Actual Natural Gas Pipelines 1,289 1,528 CO2 - S&T 1 163 CO2 - EOR 227 449 Products Pipelines 235 431 Terminals 925 854 Kinder Morgan Canada 122…
  34. August 2016 Company Update – Kinder Morgan, Inc. – slide 34
    Credit Ratios and Liquidity(a) ( in millions) 2016 Leverage metrics 2012 2013 2014 2015 Budget (b) Net debt to Adjusted EBITDA 5.4x 5.0x 5.5x 5.6x 5.5x Adjusted EBITDA to interest 4.0x 3.9x 4.1x 3.5x 3.6x (c) (d,e) Revolver…
  35. August 2016 Company Update – Kinder Morgan, Inc. – slide 35
    GAAP Reconciliation ( in millions) 2015 2015 Reconciliation of DCF Actual Reconciliation of Adjusted EBITDA Actual Net income 208 Net income 208 Certain items 1,441 Certain items 1,441 Net income before certain items 1,649 Net…
  36. August 2016 Company Update – Kinder Morgan, Inc. – slide 36

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