Simplification Transaction Overview On October 9th, Antero Midstream GP LP (AMGP) announced that it will acquire Antero Midstream Partners LP (AM) to be renamed Antero Midstream Corporation (NYSE: AM) or New AM AMGP to acquire 100%…
Antero Family Simplified Pro Forma Structure Midstream simplification transaction results in one publicly traded midstream infrastructure corporation with no IDRs and AR as its largest shareholder Status Quo Structure Simplified Pro…
Simplification Transaction Summary 1 Simplifies midstream structure and aligns all Antero equity holders C-Corp structure without IDRs is the increasingly preferred structure by investors Broadens potential investor base and creates…
Highest Dividend Growth Among Top 20 Midstream New AM will be a unique midstream vehicle with scale, low leverage and high distribution growth all in a C-corp structure C-CORP MLP Leverage 3-Year Dividend CAGR (2018 2021) *…
Yield vs. Growth Correlation Implies Attractive Value Antero Midstream Corporations dividend growth profile supports a premium valuation based on comparable C-corps and entities that eliminated IDRs Yield vs. Dividend/Distribution…
Strong, Growing & Supportive Sponsor
Largest Core Liquids-Rich Inventory in Appalachia 13 NE Marcellus Rigs Core Liquids-Rich Appalachia 24 Utica Undrilled Locations(1) Rigs J B H F I 5% 3% 2% 3% D 7% 7% K AR 28 SW Marcellus Rigs 7% 40% 2,234 Locations…
Largest Undrilled Core Drilling Inventory Undrilled Core Marcellus & Utica Locations(1) Marcellus & Utica Liquids Rich Locations SW Marcellus & Utica Dry Locations NE Pennsylvania Dry Locations 4,000 3,500 Who Can Consistently…
AR is One of the Largest NGL Producers in the U.S. Top U.S. NGL Producers 2018 Consensus (MBbl/d) 125 ARs significant 116 115 production and underlying liquids- 105 rich resource base 95 MBbl/d 85 .Brings AM a 75 seat…
Outstanding Corporate Level Well Economics Single Well Economics Excluding Hedges Well Economics Support Investment Full Cycle ROR Half Cycle ROR Full Cycle ROR at 70/Bbl Half Cycle ROR at 70/Bbl ROR Well in Excess of Cost of…
ARs Lower Capital & Higher Liquids Free Cash Flow Over 1.6B of Targeted Free Cash Flow from 2018 to 2022 at Strip Pricing Including Maintenance Land Capital Expenditures 5-Year Stand-Alone Free Cash Flow: Cumulative 1,500…
Cash Click Flow to editGrowth Deleveraging Master title style Profile 12/31/17 Strip Pricing (Base Case) 60 Oil / 2.85 Gas 5.0x 50 Oil / 2.85 Gas S&P Upgrade to BB+ 23% Debt-Adjusted 4.5x Moodys Ba2 Outlook Positive Production…
Premier Integrated Appalachian Midstream Assets
Antero Midstream At A Glance Status Quo AM Highlights Antero Midstream Marcellus Assets Market Cap....... 5.6B Enterprise Value.......... 7.1B LTM Adjusted EBITDA(1).. 665 MM % Gathering/Compression 65% New Smithburg JV %…
Antero Midstreams Premier Asset Footprint Antero Midstream provides a customized full value chain midstream solution in the lowest cost natural gas and liquids basins: the Marcellus and Utica Shale Integrated system in the core of the…
High Growth Midstream Throughput AM high growth throughput driven by AR development plan and resource base Low Pressure Gathering (MMcf/d) Compression (MMcf/d) 1,756 2,500 1,800 2,165 1,600 2,000 1,400 1,660 1,196 1,403 1,200…
Driving Northeast Value Chain Buildout 5-year identified project inventory of 2.7B plus an additional 1.0B of potential downstream opportunities Upstream Downstream AM Assets AM/MPLX JV Assets Potential AM Opportunities 800MM JV…
Gathering and Compression Asset Overview Significant long-term volumetric visibility from AR supports efficient gathering and compression infrastructure buildout and attractive project returns Asset Strategy 2018 & 2019 Gathering &…
New Joint Venture Processing Site New Processing Site Northeast Processing & Fractionation AM and MPLX are beginning civil construction on a new JV processing site named Smithburg in Doddridge County, WV Strategically located 2.5…
Processing and Fractionation Asset Overview Joint Venture aligns the largest core liquids-rich resource base with largest processing and fractionation footprint in Appalachia Asset Strategy JV Processing Capacity (Bcf/d) Support…
Freshwater Delivery Asset Overview Due to the reliability of AMs buried fresh water pipeline system, AM has a 100% track record of timely fresh water deliveries to ARs completions Asset Strategy 2018 & 2019 Fresh Water Projects…
Antero Clearwater Facility Asset Overview The Antero Clearwater Facility is the largest advanced wastewater treatment facility in the world for shale oil and gas operations Asset Strategy Midstream Services Provided Veolia built and…
5-year Organic Project Backlog: 2018 - 2022 High-graded organic Primary focus on rich project backlog of 2.7B gas Marcellus from 2018 - 2022 infrastructure 2.7B Project Backlog By Area 2.7B Project Backlog By Function Processing…
Antero Midstream Return on Invested Capital AM Return on Invested Capital (ROIC) 2017 ROIC of 15% in 25% only fourth year of AM operations 20% Future organic growth 15% 15% capital leverages 13% existing trunklines and 12%…
Long-Term Distribution and Coverage Targets Unchanged capital investment philosophy with disciplined financial policies result in ability to target peer-leading distribution growth through 2022 Long-Term Distribution Targets and DCF…
Financial Policy Overview Status Quo AM Maintain conservative leverage profile between 2.0x 2.5x Prudent net debt to LTM Adjusted EBITDA Leverage With ability to flex up to 3.0x on a short-term basis for accretive transactions…
Well Positioned Midstream Family Elite sponsor (AR) with scale, growth, declining leverage (Ba2/BB+/BBB-) and free cash flow(1) Sustainable cash flow growth Longer lateral Self-funding development plan Targeting 5-year free cash…
AMGP Overview: Unmatched Yield Growth
Long-Term Distribution Targets As a result of AM targeting 20% distribution growth in 2021 and 2022, AMGP is targeting distribution growth of 29% and 27% in 2021 and 2022 AMGP Long-Term Distribution Targets (Midpoint) AMGP…
AMGP Leads the Pack ARs visible and de-risked development plan 100% Pure Play IDR Vehicle AMs organic growth General Partner strategy results in with peer-leading LP unmatched distribution growth yield growth Debt-free…
Capital and EBITDA Contribution - 2018 2018 organic capital budget fully funded with retained cash flow and credit facility borrowings, no need for equity financing Capital Expenditures (MM) Adjusted EBITDA (MM) Processing &…
Liquidity & Debt Term Structure 9/30/2018 Debt Maturity Profile AM Credit Facility AM Senior Notes 1,000 900 800 Credit facility for AM 700 extended its average debt 600 maturity out to 2023 650 500 875 400 300 No…
Organic Growth Drives Attractive Rates of Return AM Organic EBITDA Buildout Multiples 12.0x AM Organic Investment Drop Down 3.1B invested to EBITDA Multiple Median: 8.8x 10.0x through 9/30/17 on 8.8x midstream infrastructure…
Antero Midstream Project Economics Just-in-time capital investment philosophy drives attractive project IRRs AM Project Economics by Investment 45% 40% 40% 40% Weighted Internal Rate of Return 35% Avg: 25% IRR 30% 28% 30%…
AR Development Focused on AM Dedicated Acreage AR Net Production vs. AM Throughput Attractive E&P 38% 6.0 40% economics on liquids-rich acreage 34% 35% dedicated to AM 5.0 AM Throughput Growth 30% 4.0 24% 22% 25% 5-year…
Advanced Completions Utilize More Water AR applies 2,000-2,500 Budget plan Vintage 1,000 1,500 lb/ft lb/ft completions in assumes proppant completions use 2017 utilizing 25% 2,000 lb/ft 33-34 Bbl/ft of water more water vs. vintage…
Fresh Water Delivery Volume Growth Wells Serviced by Fresh Water Delivery System and Lateral Length 250 Wells Serviced by Freshwater System (Low End) Average Lateral Length Wells Serviced by Freshwater System Wells Serviced by…
Maintenance Capital Methodology Maintenance Capital Calculation Methodology Low Pressure Gathering Estimate the number of new well connections needed during the forecast period in order to offset the natural production decline and…
Antero Midstream Non-GAAP Measures Non-GAAP Financial Measures and Definitions Antero Midstream views Adjusted EBITDA as an important indicator of the Partnerships performance. Antero Midstream defines Adjusted EBITDA as Net Income…
Antero Midstream Non-GAAP Measures The GAAP financial measure nearest to Adjusted Operating Cash Flow is cash flow from operating activities as reported in Antero Midstreams consolidated financial statements. Management believes that…
Antero Midstream Non-GAAP Measures Adjusted EBITDA and Distributable Cash Flow are non-GAAP financial measures. The GAAP measure most directly comparable to Adjusted EBITDA and Distributable Cash Flow is Net Income. The non-GAAP…
Antero Midstream Non-GAAP Measures The following table reconciles consolidated total debt to consolidated net debt (Net Debt) as used in this presentation (in thousands): September 30, 2018 Bank credit facility 875,000 5.375% AM…
Antero Midstream Non-GAAP Measures The following table reconciles net income to Adjusted EBITDA for the years ended December 31 as used in this presentation (in thousands): 49
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