CEO Highlights Key Message Committed to Efficient Capital Allocation Divested operations not generating consistent and predictable free cash flow Directing capital towards quick payback shale services and predictable and consistent…
Flexible Business Models Deliver During A Downturn During the 2015-2017 downturn period, TETRA and CSI Compressco generated Adjusted EBITDA and Free Cash Flow s in M TETRA Only CSI Compressco Adjusted EBITDA(1) 195 308 Capital…
Focused on Three Segments Completion Fluids & Products Limited number of competitors Size, scale and vertical integration provides a cost and logistics advantage Onshore, offshore and industrial markets balance cyclicality of the…
Capital Structure TETRA has improved its balance sheet, dropping TETRA-only total debt from (1) 430M plus 47M of Maritech's AROs in 2014-Q3 to 199M at 3/31/18 Given our ability to generate free cash flow through all cycles, we are…
Management Depth, Focus and Oversight Recent significant additions to the management team to deliver during this upcycle Management incentive programs focused on shareholder returns with the key metric of generating free cash…
Experienced Management Team (todays attendees) Stu Brightman Jim Funke CEO of TETRA, Chairman of the Board of CCLP; previously Dresser VP of TETRA Chemicals Industries and Cameron Liz Evans Brady Murphy VP HR of TETRA and CCLP;…
Board of Directors With Relevant Industry Experience William Sullivan (1), (3) Paul Coombs (1), (3) Previously EVP E&P Anadarko Previously EVP and COO of TETRA Mark Baldwin (1) Stu Brightman (1), (3) CEO of TETRA; previously Dresser…
Division Overviews and Strategy Brady Murphy President and COO 12
Business Segments Focused on high growth, higher margin segments Water & Flowback Services Completion Fluids & Products Compression Differentiated offerings Industry leaders, 30% market Wide range of HP to address for produced…
Business Segments Completion Fluids & Products High value fluids for customers highest value wells Well positioned for deepwater market recovery Completion Fluids Compression 63% of last decade discoveries from deepwater wells (1)…
Core Values are Intact Our TETRA customer-centric framework allows us to drive key behaviors to build an accountability and performance-driven culture Customers R Zero HSE Returns C Employees E 15
Core Values are Intact Customers Returns 2015-2017 Completion Fluids & Products generated 233M adjusted EBITDA on 13M capital investment (1) Minimum ROIC threshold for 2018 capital spending of 20% Zero (HSE) Employees…
Macro View of Global Oilfield Services 100 B 51 Mb/d of global supply 80 is assumed to be in decline Intl Oilfield Service by the IEA in 2017 Market Spend 60 of the worlds 40 83% oil production 20 of the worlds NA…
Lower 48 U.S. Oil Production Outlook Lower 48 onshore crude oil production by region (reference case) million barrels per day 2017 5 History Projections Associated gas production Southwest from shale oil basins will 4 Million…
TETRA Market Segment Revenue Well positioned for highest growth markets TETRAs 2017 % of Global Revenue 19
Deepwater Returns, Not If, When Global Oil Discoveries Dominating new discoveries and reserve replacement this decade Operators' highest value wells require the most reservoir-friendly fluids (Drilling and Completions) Often…
Strategy on a Page Completion Water & Flowback Compression Fluids & Products Services* Market Size Est 1B 9B 3B(2) 2018 Revenue(1) 283M 290M 393M Leverage vertical integration, new unit Leverage innovation, vertical Leverage…
Summary Simpler, focused, leveraging core competencies CRE intact and central to our culture Geographic footprint aligned with projected market spend Positioned for growth and margin expansion 22
Growth Through Innovation Water & Flowback Services Matt Sanderson Senior Vice President 23
Financial Summary Water & Flowback Services SwiftWater acquisition, pricing momentum and high ROIC driving earnings Actual Key Financial Drivers Guidance s in M 2016 2017 2018 SwiftWater performing above acquisition guidance of…
TETRA Market Segment Revenue Water Market (2018) 10% Capital Exposure to 16% Service Market CAGR% Intensity Recycle Segment Size % 2017-2022 4% Disposal 23% 6% 23% Market Acquisition Hauling 9% 30% 21% 12% 11% 25.5B…
Strong North American Presence Well positioned in all major shale plays Grand Prairie, AB Crossfield, AB Williston, ND Wright, WY Mansfield, PA Vernal, UT Greely, CO Bridgeville, PA Current TETRA Service…
TETRA Integrated Water Solutions Post Job Full Offering Treatment Water for Frac Services Only no asset ownership Transfer Re-use No Offering Fresh Pre-Frac Water Flowback/ Fluids Final Water Treatment & Frac Job Containment…
Lowest Cost per Barrel Fluid Solutions 28
Lowest Cost per Barrel Fluid Solutions 29
Lowest Cost per Barrel Fluid Solutions LEADERSHIP IN WATER TRANSFER First mover in deployment of lay flat hose Differentiated TETRA Steel water transfer system Exclusive provider Only double-jacketed lay flat hose, UV-resistant hose…
Lowest Cost per Barrel Fluid Solutions 31
Lowest Cost per Barrel Fluid Solutions LEADERSHIP IN SAND MANAGEMENT Retrofit Design Sand Viking Unload more proppant faster without back pressure on the well 3x more efficient in sand recovery Minimize damage to customers…
Lowest Cost per Barrel Fluid Solutions 33
Lowest Cost per Barrel Fluid Solutions LEADERSHIP IN TREATMENT & RECYCLING Blending Controller Conserves fresh water by blending reclaimed produced water on the fly Optimal fracturing fluid that meets customer water specifications…
TETRAs Lowest Cost per Barrel Solution with Automation and Recycling 150,000 Benefits to TETRA Improved Personnel Utilization Bundling Services and Automation pull-through 95,000 2 People Improved Margins (less fuel, less people…
Water & Flowback Services Perspectives Beyond 2018 One of the best positioned segments for rapid growth and high returns Water volumes expected to remain high TETRA SteelTM water transfer system has proven to be a differentiator…
Growth Through Innovation Completion Fluids & Products Matt Sanderson Senior Vice President 39
Financial Summary Completion Fluids & Products Multiple opportunities to capture growing demand w/out incremental capital investment Actual Key Financial Drivers Guidance s in M Advancing on several TETRA CS Neptune Completion…
Leading Global Completion Fluids Provider Innovation leadership Cost and delivery advantage through vertical integration Control of quality Assurance of supply Unique market insight from both supplier and service…
Basis of Completion Fluids is Clear Brine Fluids (CBFs) Water-based fluid Max Weight Product Price lbs/gallon Dissolves salt(s) for density Cesium Formate 18.3 300x Ca Zinc Bromide 19.2 No suspended solids Tight specification on…
CBFs Applications 1.1 Billion Completion & Workover Fluid Density (well control) Casing and reservoir friendly Market Packer Fluid Maintains well hydrostatic pressure Requires temperature stability and low corrosion 30%+…
Unique Position to Exploit Global Market Opportunities Preferred supplier agreements for completion fluids Exposure to large-scale, multi-year/service projects Leveraging global infrastructure and commercial organizations…
TETRA Innovation Group (TIG) Innovation Solution High-density, solids-free completion fluid TETRA CS Neptune Completion (density up to 15.4 ppg) Fluids System Zinc-free (environmentally friendly) Formate-free (cost effective)…
The Game Changer TETRA CS Neptune Completion Fluids System Multi-billion dollar capital investment to develop a major deepwater Gulf of Mexico field Host production facility could accept zinc-based completion fluid Alternative…
not to mention other Addressable Market Opportunities Reservoir Drill-in Fluids (RDFs) Drills with oil-based mud efficiency, but 9 Billion with the completion simplicity of a water-based drilling fluid Minimizes damage to the…
Next Generation TETRA CS Neptune Completion Fluid System Opportunities The Challenge: Upcoming customer projects with increasingly hostile operating environments, with increased environmental concerns and reservoir sensitivity to…
Completion Fluids & Products Perspectives Beyond 2018 TETRA CS Neptune Completion Fluids System projects, diversification and spare capacity positioned to capture growing market Strong returns on capital as volumes increase…
Summary Growth with a focus on highest return on capital investments High returns on capital Differentiated water solution technologies Compelling integrated fluids offering Innovation leaders in completion fluids…
Chemical Advantage Jim Funke Vice President 52
TETRA Chemicals Vertically integrated provider of clear brine fluids Strong market position in non-oil & gas markets High barrier to entry Bromine clear brine fluids Calcium chloride Significant footprint and plant capacity to…
TETRA Chemicals Highlights Industrial market growth during the downturn helped offset energy market decline Adjusted EBITDA at the valley of the cycle remained above 15% Low annual maintenance CapEx Currently operating at 60%…
High-value Bromine Fluids CBF VALUE CHAIN Benefits of Vertical Integration Bromine supply Low-cost, long-term agreement Used for calcium, zinc and sodium bromide Bromine fluid production West Memphis manufacturing plant o…
Calcium Chloride Market Diversification Focused effort to grow industrial business TETRAs Industrial Calcium Chloride Volume Increased industrial segment volume by 24% from 2013 to 2017 DMT Dry Metric Ton Reduced reliance on…
Calcium Chloride Manufacturing Platform Manufacturing processes CBF VALUE CHAIN 6 Plants Neutralize hydrochloric acid with limestone 2 Plants Solar evaporation 1 Plant Mechanical evaporation Long-term low-cost HCl supply agreements…
Calcium Chloride Europe Footprint 4 Manufacturing Plants 1 owned 3 exclusive supply position Manufacturing Plants Warehouses Added Hamm, Belgium supply in 2016 Exclusive marketer of calcium chloride No capital investment by…
Calcium Chloride North America Footprint Liquid CaCl2 Plant Liquid / Dry CaCl2 Plant Liquid Terminal Dry Warehouse Strategic supply position to all O&G shale basins and Gulf of Mexico Multiple manufacturing plants to meet…
Quick Payback on Incremental Investments 2M to 3M annual EBITDA with less than 2.5M total investment West Memphis, AR Tote packaging Further vertical integration Improves cost position Mojave Desert Sodium chloride Bulk salt…
TETRA Chemicals Growth Initiatives Completed Commercialization Commercialization May 2018 Q4 2019 2020+ Lithium El Dorado Calcium Shale Produced in Brines Chloride Spray Water Recycling Drying In development Leverage existing…
TETRA Chemicals Summary Only producer positioned to supply all shale segments Unique CBF vertical integration position Well diversified calcium chloride position Plants have capacity to meet growing demand Growing share in sodium…
Permian Basin Hunter Morris Vice President Permian Operations 63
Market Leader in Permian through SwiftWater Strategic rationale of SwiftWater acquisition SwiftWater significantly expands TETRAs presence in the Permian Basin Leading water service employer in the basin Strong, talented and proven…
SwiftWater Financial & Operational Highlights SwiftWater revenues grew over 3x during the downturn Post-closing projections of annualized 16M to 20M EBITDA(1) March 2018 SwiftWater results: 8.1M revenue 2.3M EBITDA (1)…
Positioned in all the Right Places in the Permian Strategically located facilities covering the entire Permian Basin Track record of scaling Vertically integrated water service platform Portfolio of leading water service Jal, NM…
Permian is THE Unconventional Basin Globally 4 of the top 5 lowest breakeven basins Currently 45% of the total U.S. land rig count and over 25% of global land rig count(3) Highest activity in U.S. land Has been the fastest…
D&E Spend up 3X while DUCS continue to Grow 68 (1) Source: EIA, As of February 20, 2018
Water Management in Permian A Growing and Critical Challenge TETRAs solutions reduce costs and promote sustainable development Longer lateral wells Increasing water volumes per well Multi-well pad drilling Exploration to…
Produced Water The Tipping Point Shifting toward a produced water Tipping Point Apaches 2018 company goal is to Fresh water demands of 500,000 to 600,000 use 50% recycled bbls per well is unsustainable produced water in its frac…
Our Permian Portfolio has Expanded Differentiated offerings across multiple product lines Fresh and produced water transfer Pump-manifold automation and 300+ miles of temporary water line remote monitoring Flowback and testing…
Dynamic, Integrated Service Platform Increasingly complex water logistics Full Offering Services Only no pipeline ownership Technologies reduce costs for operators, No Offering create differentiation Post job Treatment…
Aligned with the Most Active Permian Operators Recurring revenue streams, consistent book of business Complemented by large, high-margin projects Large customers are increasingly focused on environmental stewardship and risk…
S U C C E S S S T O R Y : Cross-selling TETRA Steel water transfer system Leading SwiftWater water transfer client shifting from 100% freshwater and 0% produced water to 25 - 50% produced water in 2018 - 2019 Client requiring…
S U C C E S S S T O R Y : Produced Water Recycling on a 4-well zipper frac Total produced water treated for reuse: 1.3 million bbls Client cost savings of 500,000 Elimination of fresh water Recycling was paired with TETRA…
Permian Summary SwiftWater transaction positions TETRA as a leading player in the Permian Integrated shale strategy a compelling offering Realizing immediate cross-selling opportunities Pursue strategic acquisitions while…
Financial Summary - Compression Well positioned to capitalize on the growing compression market Actual Guidance Key Financial Drivers s in M 2016 2017 2018 Increasing pricing up to 15% Revenue 311 296 385 - 400 Intent to add…
Served Markets Gas Supply Chain Percentage of Revenue and Gross Profit by Product Line Q1 2018 Actuals We are a Compression Solutions provider focused on E&P and Midstream Companies in the major Revenue 16% Gross Profit associated…
Served MarketsMacro Outlook Evolving market conditions driving increased compression demand Technology and efficiency enhancements generating higher volumes per well Associated gas volumes driving record production levels and demand…
Focused on Most Prolific Producing Basins in USA 4% Bakken 11% 33% Niobrara Utica 20% Marcellus Monterey Woodford SCOOP/Stack 11% 21% San Juan Barnett Haynesville HP Distribution by CCLP Region as of 3/31/18 Permian &…
Served Markets The Gas Value Chain Since 1971 CCLP has delivered over 5.1M HP to these markets Sizes for Solutions Compression Services offerings from 20-2,500HP from wellhead, gas lift and gas gathering applications. New…
Served Markets Growth Strategic focus on key shale oil plays of the Permian/Delaware, Eagle Ford and SCOOP/STACK where 75% of our assets are located Total Fleet HP Utilization Trend 1,200 86.0% Six consecutive quarters of improved…
Diversified, Blue-Chip Customer Base E&P and Midstream Companies Major customers COMPRESSION SOLUTIONS Compression Services in gas applications across multiple basins New Equipment Sales available for customers that own their…
Compression Services Increased Growth Strategic partnerships and customized 20 to 2,500HP size solutions to grow market share range Customer demand growing throughout 89% of operating fleet is full range of equipment from…
New Unit Sales Increased Growth With the largest compression fabrication facility in the Permian Basin, located in Midland, Texas, our vertically integrated business model is highly capital efficient Our growth strategy: Increasing…
Aftermarket Services Increased Growth Implementation of strategies that increase our share of Aftermarket Services and Parts Market Drivers and Growth Strategy: Accelerating Revenue Growth Growing customer installed base Deferred…
Connected Enterprise Business Strategy Model SALES OPPORTUNITY Automation and efficiency gains REPORTING AND INVOICING CONFIGURE, PRICE AND QUOTE lead to 4M in yearly savings Operational Excellence Maximize efficiencies by…
SUCCESS STORIES THE GAS VALUE CHAIN WELLHEAD PRODUCTION ENHANCEMENT GAS LIFT GAS GATHERING MIDSTREAM GAS PROCESSING PLANT CSI COMPRESSCO 93
S U C C E S S S T O R Y : Improving returns on capital: repurposing GasJacks to replace more costly compressors for enhanced crude oil production in unconventional plays C H A L L E N G E S T R AT E G Y R E S U LT S E&P customer in…
S U C C E S S S T O R Y : Surface gas lift compression with small HP units displacing ESPs creating new revenue stream and opportunity C H A L L E N G E S T R AT E G Y R E S U LT S Customer began testing gas lift on new Partner with…
S U C C E S S S T O R Y : Delivering customer-specific solutions by combining gas lift and field gathering compression in high volume associated gas plays C H A L L E N G E S T R AT E G Y R E S U LT S Design compression sites for a…
S U C C E S S S T O R Y : New Unit sales opportunities driven by midstream infrastructure build-out in the Permian Basin C H A L L E N G E S T R AT E G Y R E S U LT S Major Permian Basin midstream player Leverage our major…
SUMMARY CSI COMPRESSCO 98
Compression Perspectives Beyond 2018 Investing in high return projects, outgrowing the market and de-leveraging Market expected to grow 6-7% per year. CCLP poised to invest and grow above these levels Targeting ROIC target of 20% or…
SUMMARY Compression Solutions We are the largest vertically integrated supplier Compression Services Approximately 75% of HP is concentrated in the most prolific producing basins New Equipment Our large scale fabrication facility is…
Loading...
