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June 2018 Investor Presentation – Targa Resources Corp.

Targa Resources Corp. · Jun 15, 2018 · 54 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. June 2018 Investor Presentation – Targa Resources Corp. – slide 1
    Targa Resources Corp. Investor Presentation June 2018
  2. June 2018 Investor Presentation – Targa Resources Corp. – slide 2
    Investment Highlights Positioned for Premier Asset Visible Financial Long-Term Position Growth Discipline Success Integrated Capital investments Strong balance Investments align midstream asset underway support sheet and liquidity…
  3. June 2018 Investor Presentation – Targa Resources Corp. – slide 3
    Premier Integrated and Diverse Asset Footprint Integrated Midstream Platform Connects Lowest Cost Supply Growth to Key Demand Markets Substantial gas processing in top-tier basins 10.5 Bcf/d gross processing capacity and…
  4. June 2018 Investor Presentation – Targa Resources Corp. – slide 4
    Strategic Outlook Investing in projects that leverage existing Targa infrastructure and further strengthen competitive advantage 75% of announced growth capital program focused on the Permian Basin (1) Increasing producer…
  5. June 2018 Investor Presentation – Targa Resources Corp. – slide 5
    Permian Leads Domestic Production Growth Lower 48 Onshore Tight Oil Production Targa Asset Position 2,500 120 Permian Targa is one of the largest Use of horizontal drilling Permian Rig Count Jun 2018: gatherers and processors of…
  6. June 2018 Investor Presentation – Targa Resources Corp. – slide 6
    Supply Growth Drives Need for More Infrastructure Permian wellhead gas production forecasted to increase by 8 Bcf/d from 2017 through exit 2020 Industry-leading returns at the wellhead expected to drive production growth even in a flat…
  7. June 2018 Investor Presentation – Targa Resources Corp. – slide 7
    Targas Premier Permian Position Legend Active Rigs (4/16/18) Processing Plant Processing Plant In Multi-plant, multi- Progress Crude Terminal system Permian Existing Gathering Pipeline footprint, Grand Prix In Progress GCX…
  8. June 2018 Investor Presentation – Targa Resources Corp. – slide 8
    Permian Midland Basin Expansions to Keep Pace with Growth Asset Map and Rig Activity(2) Legend Targa Midland Basin Inlet Volume(1) Active Rigs (4/16/18) 1,400 Processing Plant Processing Plant In Progress 1,200 12 Crude…
  9. June 2018 Investor Presentation – Targa Resources Corp. – slide 9
    Permian Delaware Basin Expansions to Keep Pace with Growth Asset Map and Rig Activity(2) Legend Targa Delaware Basin Inlet Volume(1) Active Rigs (4/16/18) Processing Plant 600 Processing Plant In Progress Crude Terminal 500…
  10. June 2018 Investor Presentation – Targa Resources Corp. – slide 10
    Significant NGLs from Targa Permian Plants Gross NGL Production (MBbl/d) NGL production from Targas G&P footprint is expected to continue 250 to significantly increase Targas annual gross Permian NGL production has grown by an…
  11. June 2018 Investor Presentation – Targa Resources Corp. – slide 11
    Increasing Permian Basin NGL Production Outlook The expected growth in Permian associated gas production will result in increasing NGL production Targas Downstream business is well positioned to handle the increase in NGL production…
  12. June 2018 Investor Presentation – Targa Resources Corp. – slide 12
    Targas Growing NGL Footprint Increasing NGL production directs increasing volumes to Grand Prix and Targas Downstream complex at Mont Belvieu Availability for Targa manages significant NGLs from its Existing Plants Total Gross NGL…
  13. June 2018 Investor Presentation – Targa Resources Corp. – slide 13
    Additional Delaware Basin Processing Expansions Legend Long-term fee-based agreements to provide Active Rigs (4/16/18) integrated midstream services Processing Plant Processing Plant In Progress Crude Terminal Targa entered into…
  14. June 2018 Investor Presentation – Targa Resources Corp. – slide 14
    Targas Grand Prix NGL Pipeline Project Grand Prix connects growing supply to premier NGL hub at Mont Belvieu Targa has the largest G&P position in the Permian Basin supported by substantial acreage dedications, in addition to its…
  15. June 2018 Investor Presentation – Targa Resources Corp. – slide 15
    Grand Prix Overview Strategic Rationale Enhances Targas competitive capabilities to move volumes from Grand Prix Volumes the wellhead through the Targa value chain to key end markets Expected to Continue to Increase Increases…
  16. June 2018 Investor Presentation – Targa Resources Corp. – slide 16
    Grand Prix Extension into Southern Oklahoma Strategic Rationale Grand Prixs extension into southern Oklahoma integrates Targas G&P positions in SouthOK and North Texas with its transportation and fractionation assets Additional…
  17. June 2018 Investor Presentation – Targa Resources Corp. – slide 17
    Targas Fractionation Footprint Grand Prix further bolsters volumes to Targas Mont Belvieu fractionation complex Grand Prix will direct significant NGL volumes to Targas fractionation complex from the Permian, Southern Oklahoma and…
  18. June 2018 Investor Presentation – Targa Resources Corp. – slide 18
    Gulf Coast Express Pipeline (GCX) Delaware Basin Strategic Rationale: Midland Basin Secures reliable takeaway for increased natural gas production from the Permian Basin to premium markets along the Texas Gulf Coast Further…
  19. June 2018 Investor Presentation – Targa Resources Corp. – slide 19
    Longer-Term Financial Outlook In June 2017, Targa published a longer-term financial outlook highlighting that attractive projects and system expansions were expected to drive increasing system volumes, translating into increasing…
  20. June 2018 Investor Presentation – Targa Resources Corp. – slide 20
    Infrastructure Investments Focused in the Permian An increasing fee-based and operating margin outlook underpinned by attractive organic growth projects underway, with 75%(1) of total project capex focused on the Permian Basin…
  21. June 2018 Investor Presentation – Targa Resources Corp. – slide 21
    2018 Announced Net Growth Capex 2018E net growth capex based on announced projects after DevCo JVs estimated at 2.2 billion; 85% of total G&P capex focused on the Permian; 75%(1) of total project capex focused on the Permian Total…
  22. June 2018 Investor Presentation – Targa Resources Corp. – slide 22
    2018 Financing Overview Significant multi-faceted progress made already in 2018 to finance growth capital program underway DevCo JVs announced in February 2018 reimbursed Targa for 190 million of capital already spent, and Stonepeak to…
  23. June 2018 Investor Presentation – Targa Resources Corp. – slide 23
    Key Takeaways Right assets in the right places - integrated G&P asset platform in Strategically top-tier basins, with premier connectivity to demand markets Located Assets Premier position in the Permian Basin G&P volume growth…
  24. June 2018 Investor Presentation – Targa Resources Corp. – slide 24
    Organizational and Financial Information
  25. June 2018 Investor Presentation – Targa Resources Corp. – slide 25
    Corporate Structure TRC Public Shareholders (219.5 million shares)(1) Targa Resources Corp. TRC Revolving Credit Facility (NYSE: TRGP) Preferred (S&P: BB- Shareholders Moodys: Ba2) 100% Interest Senior Notes Targa…
  26. June 2018 Investor Presentation – Targa Resources Corp. – slide 26
    Business Mix, Diversity and Fee-Based Margin Business Mix Segment Operating Margin(1) Downstream Field Gathering & Processing Operating Margin 2018E(1) Operating Margin 2018E(1) 100% 100% 75% 75% 65% 50% 35% 50% 25% 25%…
  27. June 2018 Investor Presentation – Targa Resources Corp. – slide 27
    2018 Expectations and Long-Term Outlook Financial Expectations Long-Term ( in millions, unless otherwise noted) FY 2018E Outlook (1) Significant growth expected over time Adjusted EBITDA 1,225 - 1,325 +12% YoY increase as capital…
  28. June 2018 Investor Presentation – Targa Resources Corp. – slide 28
    Development Joint Ventures Overview & Key Terms On February 6th, Targa announced the formation of 1.1 billion(1) of DevCo JVs with Stonepeak Infrastructure Partners DevCo JV Assets Grand Prix DevCo 20% interest in Grand Prix…
  29. June 2018 Investor Presentation – Targa Resources Corp. – slide 29
    Development Joint Ventures Benefits 1.1(1) Billion of Development Joint Ventures Significantly Reduce Equity Needs For 2018 and 2019 No dilution to Targas existing shareholders and does not reduce dividend coverage during…
  30. June 2018 Investor Presentation – Targa Resources Corp. – slide 30
    Financial Position and Leverage Leverage and Liquidity Protecting the balance sheet and maintaining balance sheet flexibility Leverage Available Liquidity(1) remain key objectives 6.0x 2,800 2,700 TRP Compliance Covenant 2,600…
  31. June 2018 Investor Presentation – Targa Resources Corp. – slide 31
    Diversity and Scale Help Mitigate Commodity Price Changes Adjusted EBITDA vs. Commodity Prices Growth has been driven primarily by investing in Adjusted EBITDA - Actual Forecasted Adjusted EBITDA the business, not by changes in…
  32. June 2018 Investor Presentation – Targa Resources Corp. – slide 32
    Gathering & Processing Segment
  33. June 2018 Investor Presentation – Targa Resources Corp. – slide 33
    Extensive Field Gathering and Processing Position Summary Footprint 6.0 Bcf/d of gross processing capacity(1)(2)(3)(4) Significant acreage dedications in the Permian Basin, Bakken, SCOOP, STACK and Eagle Ford G&P capacity additions…
  34. June 2018 Investor Presentation – Targa Resources Corp. – slide 34
    Permian Midland Basin Summary Asset Map and Rig Activity(1) Legend Interconnected WestTX and SAOU systems located Active Rigs (4/16/18) across the core of the Midland Basin Processing Plant Processing Plant In JV between Targa…
  35. June 2018 Investor Presentation – Targa Resources Corp. – slide 35
    Permian Delaware Basin Summary Asset Map and Rig Activity(1) Interconnected Versado and Sand Hills capturing Legend Active Rigs (4/1618) growing production from increasingly active Delaware Processing Plant Basin (also connected to…
  36. June 2018 Investor Presentation – Targa Resources Corp. – slide 36
    Strategic Position in the Core of the Bakken Summary Asset Map and Rig Activity(1) 460 miles of crude gathering pipelines; 200 miles of natural gas gathering pipelines 90 MMcf/d of natural gas processing capacity, expanding to 290…
  37. June 2018 Investor Presentation – Targa Resources Corp. – slide 37
    Leading Oklahoma, NorthTX and SouthTX Positions Summary Footprint Four asset areas, which include 13,400 miles of pipe Over 2.3 Bcf/d of gross processing capacity(1) 16 processing plants across the liquids-rich Anadarko Basin…
  38. June 2018 Investor Presentation – Targa Resources Corp. – slide 38
    SouthOK and WestOK Summary Asset Map and Rig Activity(1) - SouthOK SouthOK consists of 710 MMcf/d of gross processing capacity well positioned to benefit from increasing SCOOP and Arkoma Woodford activity Majority fee-based…
  39. June 2018 Investor Presentation – Targa Resources Corp. – slide 39
    North Texas and SouthTX Summary Asset Map and Rig Activity(1) North Texas North Texas consists of 478 MMcf/d processing capacity in Legend the Barnett Shale and Marble Falls play Pipeline Primarily POP contracts with fee-based…
  40. June 2018 Investor Presentation – Targa Resources Corp. – slide 40
    Coastal G&P 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. June 2018 Investor Presentation – Targa Resources Corp. – slide 41
    Downstream Segment
  42. June 2018 Investor Presentation – Targa Resources Corp. – slide 42
    Downstream Assets: Linking Supply to Demand Most flexible LPG Grand Prix to connect Superior connectivity export facility along Premier fractionation growing NGL supply to growing the US Gulf Coast; ownership position in to NGL…
  43. June 2018 Investor Presentation – Targa Resources Corp. – slide 43
    G&P Volume Drives NGL Flows to Mont Belvieu Growing field NGL production increases NGL flows to Targas expanding Mont Belvieu and Galena Park presence Rockies Grand Prix will bring NGLs from the Permian Basin, southern Oklahoma…
  44. June 2018 Investor Presentation – Targa Resources Corp. – slide 44
    Downstream Capabilities Overview Downstream Businesses The Logistics and Marketing segment represents NGL Fractionation & Related Services (65% of Downstream)(1) approximately 35% of total operating margin(1) Strong fractionation…
  45. June 2018 Investor Presentation – Targa Resources Corp. – slide 45
    Logistics Assets Exceedingly Difficult to Duplicate Fractionators Gross Net Capacity Capacity (MBbl/d) (MBbl/d)(1) Mont Belvieu(1) CBF - Trains 1-3 253 223 CBF - Backend Capacity 40 35 CBF - Train 4 100 88 CBF - Train 5 100 88…
  46. June 2018 Investor Presentation – Targa Resources Corp. – slide 46
    Targas Fractionation Assets Targa Fractionation Footprint Domestic Rig Count and NGL Supply 2,000 5,000 450 1,800 4,500 383 Liquids Production (MBbl/d) 400 1,600 4,000 350 343 354 350 309 1,400 3,500 Throughput…
  47. June 2018 Investor Presentation – Targa Resources Corp. – slide 47
    Targas LPG Export Business LPG Exports by Destination(1) Propane and Butane Exports(1) 15% 30% 45% 25% 85% Latin America/South America Caribbean Rest of the World Propane Butanes Galena Park LPG Export Volumes Fee…
  48. June 2018 Investor Presentation – Targa Resources Corp. – slide 48
    Downstream US and Global LPG Exports LPG Export Forecast(1) 120 LPG Exports (MMBbl/month) 100 80 60 40 20 - 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025…
  49. June 2018 Investor Presentation – Targa Resources Corp. – slide 49
    Reconciliations
  50. June 2018 Investor Presentation – Targa Resources Corp. – slide 50
    Non-GAAP Reconciliations 2014 to 2017 Adjusted EBITDA Year Ended December 31, Reconciliation of net income (loss) attributable to TRC to 2017 2016 2015 2014 Adjusted EBITDA (in millions) Net income (loss) to Targa Resources Corp.…
  51. June 2018 Investor Presentation – Targa Resources Corp. – slide 51
    Non-GAAP Reconciliations 2007 to 2013 Adjusted EBITDA targaresources.com NYSE: TRGP 53
  52. June 2018 Investor Presentation – Targa Resources Corp. – slide 52
    Non-GAAP Reconciliations Estimated 2018 Adjusted EBITDA The following table presents a reconciliation of Adjusted EBITDA for the periods shown for TRC: Year Ended December 31, 2018 Reconciliation of net income (loss) attributable…
  53. June 2018 Investor Presentation – Targa Resources Corp. – slide 53
    Non-GAAP Reconciliations Estimated 2019 and 2021 Adjusted EBITDA(1) The following table presents a reconciliation of Adjusted EBITDA for the periods shown for TRC: Year Ended December 31, Reconciliation of net income (loss)…
  54. June 2018 Investor Presentation – Targa Resources Corp. – slide 54
    Visit us at targaresources.com Contact Information: Email: InvestorRelationstargaresources.com Phone: (713) 584-1000 811 Louisiana Street Suite 2100 Houston, TX 77002

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