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2016 Fourth Quarter Investor Presentation – Targa Resources Corp.

Targa Resources Corp. · Feb 15, 2017 · 45 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 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 1
    Targa Resources Investor Presentation Fourth Quarter 2016 February 15, 2017
  2. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 2
    Targas Corporate Structure TRC Public Shareholders (193,949,450 Shares)(1) Targa Resources Corp. TRC Closed in March 2016 Term Loan B (NYSE: TRGP) Preferred 1 billion Series A Preferred Stock Revolving Credit Facility (S&P:…
  3. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 3
    Strong Asset Base Poised for Growth A Strong Footprint in And a Leading Position at Drive Targas Active Basins Mont Belvieu Long-Term Growth Premier Permian Basin footprint Premier fractionation ownership Disciplined balance sheet…
  4. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 4
    Attractive Asset Footprint Targas assets are positioned in some of the best basins in the US, with exposure to the Permian, STACK, SCOOP, Bakken and Eagle Ford Diversified customer base across all businesses U.S. Land Rig…
  5. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 5
    Producer Activity Drives NGL Flows to Mont Belvieu Growing field NGL production Rockies increases NGL flows to Mont Belvieu Increased NGL production will support Targas expanding Mont Belvieu and Galena Park presence…
  6. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 6
    Business Mix, Diversity and Fee Based Margin Business Mix Field G&P Diversity FY 2016 Operating Margin FY 2016 Natural Gas Inlet Volumes 2% 9% 16% 25% 47% 53% 17% 5% 11% 7% 8% SAOU * WestTX * Sand Hills* Downstream G&P…
  7. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 7
    Positioning and Strategy Looking Forward G&P growth driven by producers with assets in some of the most economic basins in the world Focus on continuing to grow in Permian (Midland Basin, Delaware Basin), STACK, SCOOP and Bakken…
  8. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 8
    Leverage and Financial Position (1) Protecting and improving the balance sheet has 2,000 Senior Note Maturities remained a focus 76% of our senior notes are set to mature in Senior Note Maturities ( in MM) 1,600 2022 and…
  9. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 9
    Diversity and Scale Help Mitigate Commodity Price Changes Adjusted EBITDA vs. Commodity Prices Growth has been driven primarily by investing in Adjusted EBITDA - Actual WTI Crude Oil Prices - Quarter Realized the business, not by…
  10. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 10
    2017E Net Growth Capex Targa expects to spend at least 700 million of 2017E growth capex (net) Four major projects are underway, including three additional natural gas processing plants Joyce WestTX Plant in the Midland Basin, Raptor…
  11. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 11
    Operational and Financial Guidance LPG Approximately two-thirds of our current estimated export capacity of 7 million barrels per month Contracts is contracted each year at attractive rates through 2022 at Some years are slightly…
  12. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 12
    Targas Attractive Asset Footprint
  13. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 13
    Extensive Field Gathering and Processing Position Summary Footprint Over 26,000 miles of pipeline across attractive positions 4.3 Bcf/d of gross processing capacity(1)(2) Announced the acquisition of Delaware and Midland Basin…
  14. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 14
    Recently Announced Permian Acquisition Adds to Targas Premier Permian Position(1) Expect to connect 65% of active Permian acquired Midland rigs are on or within 10 assets to WestTX miles of pro forma system Targa assets Pro forma…
  15. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 15
    Pro Forma Targa Delaware Basin Assets Highlights Over 5,000 miles of pipeline across Sand Hills, Versado and newly acquired assets(1) Expect to connect acquired Delaware assets to Sand Hills system Acquired Delaware assets, Sand…
  16. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 16
    Pro Forma Targa Midland Basin Assets Highlights Over 5,500 miles of pipeline across WestTX, SAOU and newly acquired Midland assets(1) Expect to connect newly acquired Midland assets to existing WestTX system at Buffalo Plant…
  17. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 17
    Permian (SAOU) Summary Summary Asset Map and Rig Activity(1) Footprint includes approximately 370 MMcf/d of processing capacity and 1,760 miles of pipeline in the Midland Basin Three active cryogenic processing plant locations and…
  18. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 18
    Permian (WestTX) Summary Summary Asset Map and Rig Activity(1) Current footprint includes approximately 855 MMcf/d of gross processing capacity and 4,440 miles of pipeline in the Midland Basin Joint venture between Targa (72.8%…
  19. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 19
    Permian (Sand Hills) Summary Summary Asset Map and Rig Activity(1) Footprint includes approximately 165 MMcf/d of processing capacity and 1,610 miles of pipeline in the Central Basin Platform/Delaware Basin Connected to WestTX and…
  20. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 20
    Permian (Versado) Summary Summary Asset Map and Rig Activity(1) Footprint includes approximately 250 MMcf/d of processing capacity and 3,615 miles of pipeline in the northern Delaware Basin Three active cryogenic processing plant…
  21. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 21
    Strategic Position in the Core of the Williston Basin Summary Asset Map and Rig Activity(1) Core position in McKenzie, Dunn and Mountrail counties 410 miles of crude gathering pipelines 200 miles of natural gas gathering…
  22. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 22
    Leading Oklahoma, North Texas and South Texas Positions Summary Footprint Four footprints including approximately 14,000 miles of pipeline Over 2.1 Bcf/d of gross processing capacity(2) JV with Sanchez Production Partners (NYSE:SPP)…
  23. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 23
    SouthTX Sanchez Energy Corp. JV Driving Growth Summary Asset Map and Rig Activity(1) JV agreements with Sanchez Energy Corp. (NYSE:SN) executed in October 2015 Gathering JV interest subsequently acquired by Sanchez Production…
  24. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 24
    North Texas Exposed to Barnett Shale and Marble Falls Summary Asset Map and Rig Activity(1) 478 MMcf/d of gross processing capacity Primarily Barnett Shale and Marble Falls Customers are a combination of larger independent…
  25. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 25
    SouthOK Exposure to Increasing SCOOP Activity Summary Asset Map and Rig Activity(1) 580 MMcf/d of gross processing capacity Velma system well positioned to benefit from increasing SCOOP activity Primary growth driver will be…
  26. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 26
    WestOK Positioned for STACK Growth Summary Asset Map and Rig Activity(1) 460 MMcf/d of gross processing capacity Declining Mississippi Lime activity has impacted volumes Majority of WestOK contracts are hybrid POPs plus fees…
  27. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 27
    Downstream Capabilities Overview Downstream Businesses Assets include: NGL Fractionation / Storage Attractive fractionation footprint at Mont Belvieu and Lake Leading Mont Belvieu (and Lake Charles) footprint with Charles underground…
  28. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 28
    Logistics Assets Extensive Gulf Coast Footprint Fractionators Gross Net Capacity Capacity (MBbl/d) (MBbl/d)(1) CBF - Mont Belvieu Trains 1-3 253 223 Backend Capacity 40 35 Train 4 100 88 Train 5 100 88 GCF - Mont Belvieu 125 49…
  29. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 29
    Targas Fractionation Assets Targa Fractionation Footprint Domestic Rig Count and NGL Supply 2,000 5,000 400.0 350 343 1,800 4,500 350.0 309 1,600 4,000 299 Liquids Production (MBbl/d) 288 Throughput (MBbls/d) 300.0 268…
  30. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 30
    Targas LPG Export Business LPG Exports by Destination(1) Propane and Butane Exports(1) 15% 30% 50% 85% 20% Latin America/South America Caribbean Rest of the World Propane Butanes Galena Park LPG Export Volumes Fee…
  31. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 31
    Additional Information Concerning - Permian Acquisition Announced January 23, 2017
  32. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 32
    Transaction Overview Targa Resources Corp. (NYSE: TRGP) (Targa or the Company) has executed definitive agreements for its subsidiary, Targa Resources Partners LP, to acquire 100% of the membership interests of Outrigger Delaware…
  33. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 33
    Strategic Rationale Assets, Operations and Contracts Highly Complementary to Connected systems allow for operational and capital efficiencies Existing Targa Expect to immediately connect Outrigger Delaware assets to Sand Hills and…
  34. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 34
    Strategic Rationale Structure and Financial Impact Initial 565 million of initial consideration represents an 9x 2017E EBITDA multiple Consideration Expect to fund through capital markets activities and borrowings from the TRP…
  35. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 35
    Summary Earn-Out Structure Potential earn-out payments are based on realized gross margin(1) on existing contracts as of the estimated close for the Outrigger Delaware and Outrigger Midland assets 565 million of Initial…
  36. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 36
    Additional Information
  37. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 37
    Noble Crude and Condensate Splitter Project Events and Non-GAAP Accounting Treatment Summary Announced an agreement with Noble Americas Corp., a subsidiary of Noble Group Ltd. March 31, 2014 (Noble), to construct a 35 Mbbl/d…
  38. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 38
    TRC Update Operating Margin 350 1,400 329 329 1,281 1,214 300 289 1,200 1,137 250 1,000 in milions in milions 200 191 800 167 179 695 682 163 150 599 640 150 600 574 442 98 400 100 50 200 0 0 (1) G&P…
  39. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 39
    Pro Forma Consolidated Capitalization ( in millions) Actual Actual Cash and Debt Maturity Coupon 9/30/2016 Adjustments 12/31/2016 Cash and Cash Equivalents 141.1 (67.6) 73.5 TRP Accounts Receivable Securitization Dec-16 225.0 50.0…
  40. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 40
    Coastal Gulf Coast Footprint Summary Footprint Asset position represents a competitively advantaged straddle option on Gulf of Mexico activity over time LOU (Louisiana Operating Unit) 440 MMcf/d of gas processing (180 MMcf/d Gillis…
  41. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 41
    Dynamics of the LPG Market VLGC Freight Rates(1) Increasing VLGC Fleet(2) 1.80 0.35 300 +7 1.60 +5 0.30 +22 283 271 276 1.40 250 +50 Baltic Shipping Rate (/gal) MB Propane Price (/gal) 0.25 +32 249 1.20 Number of…
  42. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 42
    Reconciliations
  43. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 43
    Non-GAAP Reconciliations Q4 and FY 2016 EBITDA and DCF The following table presents a reconciliation of Adjusted EBITDA and Distributable Cash Flow for the periods shown for TRC: Three Months Ended Twelve Months Ended December 31,…
  44. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 44
    Non-GAAP Reconciliations Q4 and FY 2016 Gross Margin The following table presents a reconciliation of gross margin and operating margin to net income (loss) for the periods shown for TRC: Three Months Ended Twelve Months Ended…
  45. 2016 Fourth Quarter Investor Presentation – Targa Resources Corp. – slide 45
    1000 Louisiana Suite 4300 Houston, TX 77002 Phone: (713) 584-1000 Email: InvestorRelationstargaresources.com Website: www.targaresources.com 49

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