DECEMBER 2017 Investor Presentation The smart move for terminalling and transportation (NASDAQ: BKEP & BKEPP) Private and Confidential
Who We Are Established in 2007; headquartered in Oklahoma City, OK General Partner owned by an affiliate of Ergon, Inc., since October 2016 Diversified, strategically located assets in 26 states Blueknight Energy make us a…
Common and Preferred Units Common Units Preferred Units Market NASDAQ NASDAQ Symbol BKEP BKEPP Outstanding 40,140,405 35,125,202 Yield at 12/01/17 10.9% 9.4% 0.14500/unit for quarter ended 0.17875/unit for quarter ended…
Ownership Chart Ergon, Inc. 27.5% Limited Ergon Asphalt & Emulsions, Inc. Partner Interest Ergon Asphalt Holdings, LLC 100.0% Ownership Interest Blueknight GP Holding, LLC (DE) 100.0% Ownership Interest Blueknight…
Our Sponsor Private, family-owned company Formed in 1954; based in Jackson, MS Presence in 12 countries worldwide; employs over 2,500 workers globally One of the largest asphalt emulsion marketers in the U.S. Has been a BKEP…
Ergon Overview (NASDAQ: BKEP & BKEPP) Private and Confidential 8
Operations Map BKEP Stand-Alone Operations Blueknight and Ergon Operations (NASDAQ: BKEP & BKEPP) Private and Confidential 9
Business Description (NASDAQ: BKEP & BKEPP) Private and Confidential 10
Product Terminalling Services Storage Blending Loading and unloading (including truck, rail, barge Composed of two segments: and ship) Asphalt terminalling services Commodities Crude oil terminalling Served services Liquid…
BKEP Earnings Performance vs. WTI Price ( in millions for EBITDA and Distributable Cash Flow; WTI is price per barrel) (NASDAQ: BKEP & BKEPP) Private and Confidential 13
Asphalt Terminalling Services Largest independently owned Multiple loading/unloading options: asphalt terminal network Truck 9.8 million barrels of asphalt Marine and residual fuel oil storage Rail 55 terminals across 26 states…
Asphalt Terminalling Services Characteristics of Contracts Base fee/month plus incremental revenue if Rate Structure customer exceeds minimum take or pay volumes Term 510 years Annual CPI adjustment Yes Customer/Facility…
State Highway and Infrastructure Funding Trends States that have Successfully Raised Revenue Since 2012 Source: Transportation for America http://t4america.org/maps-tools/state-transportation-funding/ (NASDAQ: BKEP & BKEPP)…
U.S. Asphalt Storage and Supply Trends Source: U.S. Energy Information Administration (NASDAQ: BKEP & BKEPP) Private and Confidential 17
Crude Oil Terminalling Services Cushing Interchange 34 tanks with 6.6 million barrels of storage Connectivity and access to all Cushing terminals Capable of receiving and/or delivering 350,000 bpd Third- Third-Party Terminal…
Crude Oil Crude Oil Pipeline Transportation Services Services Total Length: 670 miles Two primary Oklahoma transportation pipelines and one smaller West Texas gathering system Composed of two segments: Crude Oil Trucking and…
Oklahoma Crude Oil Pipelines Oklahoma Pipelines Long-term minimum take- or-pay contract with XTO Capable of transporting approximately 50,000 bpd Light crude pipeline expected to be in service in the second quarter of 2018 STACK…
U.S. Unconventional Shale Plays Oil Break- Break-Even Economics Oil break- break-evens assuming 30% BTAX IRRs 53.25 54.05 51.91 44.41 45.93 46.40 MIDLAND SCOOP/STACK DELAWARE EAGLE FORD DJ BASIN BAKKEN Oil sub- sub-play…
Strategy and Growth Opportunities Recent Activity Completed approximately 182.5 million of acquisitions since May 2015 October 2017 May 2015 February 2016 Asphalt product Asphalt product Asphalt product terminals in terminal in…
Strategy and Growth Opportunities Product Terminalling On October 31, 2017, announced the acquisition of two asphalt terminalling facilities located in Bainbridge, GA (closed on December 1, 2017) and Muskogee, OK Currently evaluating…
Strategy and Growth Opportunities Crude Oil Transportation Completion of Oklahoma SCOOP Light Crude pipeline expected by second quarter 2018 Recapture volume along our Mid-Continent pipeline and increase the overall efficiency and…
Financial Overview (NASDAQ: BKEP & BKEPP) Private and Confidential 27
Consistent Cash Flow Generation How our highly-contracted, fee-based business drives high-growth potential Over 79.3% of operating margin, excluding depreciation and amortization, is contracted Asphalt terminalling segment provides…
Consistent Financial Performance Consolidated Operating Margin Adjusted EBITDA (excluding depreciation and amortization) ( in millions) ( in millions) Distributable Cash Flows Leverage Ratio ( in millions) (NASDAQ: BKEP &…
Financial Targets Target Leverage Decrease leverage to under 4.0x Target 3.5x over long-term Distribution Policy Maintain 1.0x to 1.1x distribution coverage over long-term Keep conservative approach to distributions Maintain…
Investment Considerations (NASDAQ: BKEP & BKEPP) Private and Confidential 31
Investment Considerations Financial Profile General Partner Growth Recent acquisition of three third- Consistent profitability and party asphalt terminals and Strong alignment with Ergon earnings nine-terminal contribution from…
Unit Performance Chart (NASDAQ: BKEP & BKEPP) Private and Confidential 33
Appendix (NASDAQ: BKEP & BKEPP) Private and Confidential 34
Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Income (NASDAQ: BKEP & BKEPP) Private and Confidential 35
Operating Margin and Reconciliation to Operating Income (NASDAQ: BKEP & BKEPP) Private and Confidential 36
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