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May 2017 Stakeholder Meeting – Kinder Morgan, Inc.

Kinder Morgan, Inc. · May 9, 2017 · 50 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. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 1
    Run for Shareholders, By Shareholders David Michels Vice President Finance & IR May 9, 2017
  2. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 2
    Unparalleled Asset Footprint One of the Largest Energy Infrastructure Companies in North America Largest natural gas network in North America Own or operate 70,000 miles of natural gas pipeline Connected to every important natural…
  3. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 3
    KMI Overview Management Aligned with Investors; 14% Stake in KMI Simple Public Structure Management & Public Directors(a) Float 319MM (14%) 1,920MM (86%) Kinder Morgan, Inc. Simple Structure: (C-corp, NYSE: KMI) One equity…
  4. May 2017 Stakeholder Meeting – 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 Fees largely independent of underlying commodity prices and substantially secured by…
  5. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 5
    Capital Invested 59 Billion of Asset Investment & Acquisitions Since Inception(a,c) ( in billions) Total Invested by Type(a,c) Total Invested by Year(b,c) 35 11 30 Expansion 10.1 25 10 Acquisition 20 9 15 31.4 8.4 27.3 10 8…
  6. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 6
    Returns on Invested Capital Segment ROI(a): 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Natural Gas Pipes 13.3% 15.5% 12.9% 13.5% 14.0% 15.5% 16.7% 17.5% 16.9% 14.0% 11.9% 11.9% 11.9% 10.9%(b)…
  7. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 7
    2017 Guidance Supported by Diversified, Fee-based Cash Flow 2017 Published Budget DCF of 4.46 billion(a) 2017 DCF per share of 1.99 2017 declared dividend of 0.50 per share 3.3 billion of DCF generated in excess of dividend…
  8. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 8
    Segment Overview 93% Pipelines & Terminals Natural Gas Pipelines 73% interstate pipelines 2017 Budgeted Segment 9% intrastate pipelines & storage EBDA = 7.7 billion(a) 18% gathering, processing & treating 88% fixed-fee (27% of which…
  9. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 9
    KMI Overview by Product Served(a) Natural Gas is our Largest Market Stability of Cash Flows Natural gas: 80% take-or-pay cash flow Refined products: competitively advantaged connection NGLs Other between refineries and end markets…
  10. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 10
    KMIs High Quality Cash Flow Not all fee-based cash flow is created equal 2017 Budgeted Segment Composition of 91% EBDA = 7.7 billion(a) Fee-based Cash Flow CO2 S&T 0.2 3% Commodity- /Other 6% Hedged…
  11. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 11
    5-year Growth Project Backlog(a) 12 Billion of Attractive, Fee-based Projects World class asset footprint has driven attractive growth opportunities, secured by long-term, fee-based contracts with creditworthy counterparties 88% of…
  12. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 12
    Market Update Strong Demand Natural Gas Refined Products Continued steady, modest volume growth Multiple trends driving increased demand for U.S. natural gas Inflation-based tariff adjustment mechanism 2014 2015 2016E 2017E 2018E…
  13. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 13
    Natural Gas Transportation & Storage 55% of 2017 Budgeted Segment EBDA before Certain Items(a) Natural gas transport & storage is KMIs largest business U.S. natural gas demand(b) expected to rise by 35% through 2026(c) U.S.…
  14. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 14
    Business Risks Regulatory FERC rate cases (Products pipelines and Natural Gas pipelines) Legislative and regulatory changes CO2 crude oil production volumes Throughput on our volume-based assets Commodity prices 2017 budget price…
  15. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 15
    The Best is Yet to Come Positioned to Succeed for the Long-Term World class set of midstream assets Secure and growing fee-based cash flows Disciplined allocator of capital; high bar for new investment opportunities Investment…
  16. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 16
    Appendix
  17. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 17
    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: 77% take-or-pay(a,b)…
  18. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 18
    Asset Integrity and Safety are Top Priorities Consistent, Better-than-industry Performance Across our Businesses Safe operation of our assets is mission critical to our long-term success Continuous reduction in risk to the public,…
  19. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 19
    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…
  20. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 20
    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…
  21. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 21
    Employee Safety Statistics(a) KM Lost-time Incident Rate (DART) OSHA Recordable Incident Rate 4 7 Lost-time injuries per 200k hours 6.4 OSHA Recordable Incidents per 3.6 6 6.0 200k Hours Worked 3 5 worked 4…
  22. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 22
    Natural Gas Pipelines Segment Outlook Well-positioned connecting key natural gas resources with major demand centers Long-term Growth Drivers: LNG exports Liquefaction facilities Pipeline infrastructure Exports to Mexico Gas…
  23. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 23
    Natural Gas Pipelines New Firm Transport Capacity Significant Contracting of Existing & New Capacity __________________________ (a) As of 1/1/2017. 24
  24. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 24
    Natural Gas Pipelines Drivers of Future Growth LNG Exports LNG Export Opportunity(a) Contracted KM Project/Transportation Capacity In-Service KM Capital 18.5 Bcf/d of FERC approved projects KM Asset (Terminal) (MDth/d) Date (MM)…
  25. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 25
    Natural Gas Pipelines Liquefaction at Elba Island Elba Liquefaction Company (ELC) / SLNG Capacity: LNG output capacity equivalent to 350 MMcf/d Capital (100%): ELC: 1,436.4 MM SLNG: 433.8 MM Phased In-service: Mid 2018 through…
  26. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 26
    Natural Gas Pipelines Drivers of Future Growth Kinder Morgan Delivers 76% of U.S. Exports to Mexico Exports to Mexico are forecasted to increase by 2.0 Bcf/d Contracted KM to 5.6 Bcf/d by 2021(a) KM Project / Transportation Capacity…
  27. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 27
    Natural Gas Pipelines Drivers of Future Growth Other Power generation Continued trend of generators procuring firm transportation and storage services to ensure their performance in ISO capacity reliability programs Increasing…
  28. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 28
    Natural Gas Pipelines Contracted Capacity and Term by Region Contracted Average Term Region Capacity Remaining Storage 355 Bcf 3 yr, 1 mo North Transport 19.7 Bcf/d 6 yr, 2 mo Storage 52 Bcf 1 yr, 8 mo Interstate South…
  29. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 29
    Products Pipelines Segment Outlook Stable, Strategic Assets Long-term Growth Drivers: Miles of Pipe: 9,760 Transmix: 5 facilities Increased demand for refined products Terminals: 67 Condensate Processing: volumes Tank Capacity:…
  30. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 30
    Products Pipelines Stability and Growth(a) Refined Products(b): U.S. Refined Product Consumption(c) 2016: Refined products volumes 1,651 MBbl/d, up 0.3% vs. 2015 10 Motor Gasoline Distillate Fuel Oil Jet Fuel Gasoline up 1.2%,…
  31. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 31
    Products Pipelines Utopia Pipeline Project Project Scope 50/50 JV with Riverstone Holdings closed on June 28, 2016 215 mile new build and existing 67 mile 12 pipeline Will transport ethane and ethane-propane mix from points in…
  32. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 32
    Terminals Segment Outlook Diversified terminaling system in key refinery / market hubs KM Terminal Facilities Long-term Growth Drivers Bulk(b) 37 Terminals Refined product supply and demand Liquids 51 Terminals growth Total KMT…
  33. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 33
    Terminals Stable Fee-Based Business 2/3 of KMTs 2017 budgeted EBDA is supported by take-or-pay contracts 100% 90% Liquids Other Fee- 73% Take-or-pay based - fixed monthly lease 80% 27% payments (MWC) - minimum throughput…
  34. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 34
    Terminals Diversified Revenues Diversified revenues across liquids and bulk KMT Product Revenues millions 2017 Budget(a) ( millions) (percent) 0 100 200 300 400 500 600 Liquids 1,426 74% Gasoline Crude Bulk 500 26% Diesel…
  35. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 35
    Terminals KMT Presence in Liquids Hubs North 40 Edmonton South Alberta Crude Terminal Rail Edmonton South Rail Terminal KMT Liquids 90 million Bbls of capacity Van Wharves Edmonton 1.0 billion Bbls throughput Alberta 97.5%…
  36. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 36
    Terminals High Demand Liquids Hubs Critical infrastructure to industry and our customers, 100% contracted Houston Ship Channel largest integrated refined product terminaling system in the world New York Harbor global refined…
  37. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 37
    Terminals Tankers APT Jones Act Fleet All of APTs available vessels are sailing under time-charter with limited 2017 exposure Average term contract length of 2.8 0 12 KM 24 Fleet Charter 36 Status 48 60 72 years across…
  38. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 38
    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…
  39. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 39
    CO2 KM CO2 Current Outlook 4.7 Billion Cumulative Free Cash Flow Generated Since Inception(a) Development Plans 2017-2026 SACROC Total Business IRR (2000-2026): 28.2% Continue platform development/redevelopment Net BOE(b) KM…
  40. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 40
    CO2 2017 Projects Price Sensitivity AT IRR % vs Oil Price 50 53 60 Forward /Bbl flat flat flat Curve(a) SACROC-Bypass (Long Lateral) 27% 32% 44% 37% SACROC-Bypass (Sidetrack Lateral) 41% 47% 61% 50% SACROC Hawaii 14% 19% 30%…
  41. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 41
    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 regulatory process, major…
  42. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 42
    KM Canada Trans Mountain Expansion Project (TMEP) Only Oilsands Pipeline Serving the West Coast Expansion to 890 MBbl/d from 300 MBbl/d today Western Canada Supply vs Takeaway Capacity (MMBbl/d)(a) 615 miles new pipe; 12 new pump…
  43. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 43
    Two Decades of Stable Growth Strategy Has Led to Consistent, Growing Results KMP Annual LP DCF per Unit(a) KMI Annual DCF per Common Share 6 2.50 5.39 5.61 5.07 5 4.68 4.43 2.00 2.14 4.15 4.25 2.02 2.00 1.99 4 3.65 3.38 3.29…
  44. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 44
    KMI Counterparty Exposure Strong Customer Credit, Valuable Services Limit KMIs Risk(a) High-Quality, Diversified Customer Base Top 25 Customers(b) KMIs 2016 DCF was impacted by less than 10 million due to oil & gas bankruptcies A-…
  45. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 45
    2017 Growth Capital Forecast (millions) 2017 budgeted growth capital fully funded by internally generated cash flow, with no requirement to access capital markets 2017 2016 (a) Growth capital Forecast Actual Natural Gas…
  46. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 46
    Credit Ratios and Liquidity(a) ( in millions) 2017 Leverage metrics 2013 2014 2015 2016 Forecast (b) Net debt to Adjusted EBITDA 5.0x 5.5x 5.6x 5.3x 5.4x Adjusted EBITDA to Interest, net 3.9x 4.1x 3.5x 3.6x 3.8x (c) (d)…
  47. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 47
    GAAP Reconciliation ( in millions) Yr. Ended Yr. Ended Reconciliation of DCF 12/31/16 Reconciliation of Adjusted EBITDA 12/31/16 Net Income 721 Net Income 721 Certain Items 933 Certain Items 933 Net Income before Certain Items…
  48. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 48
    Notes 50
  49. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 49
    Notes 51
  50. May 2017 Stakeholder Meeting – Kinder Morgan, Inc. – slide 50

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