Driving Distinctive Growth 2014 Wells Fargo Energy Symposium December 9, 2014
Driving Distinctive Growth Leading provider of upstream and downstream logistics services in Western United States Distinctive logistics growth strategy for crude oil, natural gas and refined products Balanced approach through…
Overview of Current Assets Anacortes Key Metrics Crude Oil, refined product and Kenai Bakken 3,500+ miles Natural gas pipelines Powder River Mandan Natural gas throughput capacity 2,900+ MMcf/d Green Natural gas inlet processing…
Strategic Initiatives Focus on Focused fee-based business with long-term minimum commitments Stable, Fee- Maintain minimal commodity risk Based Business Provide full-service logistics offering Optimize Improve operational efficiency…
Competitive Advantage Well-Positioned Assets High Plains System positioned in core Bakken area Rockies natural gas system in low cost basins Southern California system supports high demand market Strategic Sponsorship Integral to…
Tesoro Driven Logistics Opportunities Feedstock Inbound Logistics Refining Outbound Logistics Product Sales Acquisition Marine Refinery tank Refined products Wholesale terminals terminals distribution distribution terminals…
Track Record of Delivering Value in millions 300-315 84 35 42 2011 EBITDA 2012 2013 2014 EBITDA Guidance Expected EBITDA growth of over 250 million since IPO 1) CAGR = Compound Annual Growth Rate for 2011 EBITDA…
Strategic Growth Accomplishments in millions Expected Annual 2014 Accomplishments EBITDA Contribution1 Acquisition of QEP Field Services 250-275 65 MBD High Plains Crude Oil Pipeline Reversal project 25 360,000 barrels of…
QEP Field Services Transaction Business acquired December 2, 2014 Transaction enterprise value of 2.5 billion Including 58% ownership interest of QEPM Transaction financing 1.3 billion from TLLP common equity 1.3 billion from…
Distinctive Growth Strategy in millions 2014 2015 2016 2017 Gathering (Incl. natural gas) 60-65 265-285 310-340 335-395 Processing N/A1 120-140 140-160 150-180 Terminalling and Transportation 260-270 285-315 300-330 310-340 Tesoro…
Gathering Expected EBITDA in millions Deliver 2015 expected EBITDA of 335-395 265 to 285 million 310-340 Expand capacity on High Plains 265-285 System through organic growth projects Drive natural gas gathering growth 60-65…
Crude Oil Gathering High Plains Pipeline Map Investing 250 million in crude oil Lake Sakakawea North Dakota gathering opportunities in 2015 High Plains Pipeline Third-party pipelines Crude oil flow Complete Connolly Gathering…
Growing Rockies Natural Gas Production Natural Gas Production Outlook Rockies Operating Areas Expected production growth of 1600 MMBTU/d 15% to 25% through 2017 Incremental infrastructure 1200 required to support production…
Natural Gas Gathering Investing 90 million in natural gas gathering opportunities in 2015 Add compression to Pinedale system to increase gathering and processing volumes Add gathering and compression to Vermillion system to…
Processing Expected EBITDA Deliver 2015 expected EBITDA of in millions 120 to 140 million 150-180 Increase utilization through 140-160 gathering new production and 120-140 commercial initiatives Leverage capabilities to…
Processing Identified Opportunities Increase utilization of Uinta and Pinedale capacity with growing production and commercial capabilities Potential processing expansion in Uinta and Vermillion to support production growth in…
Terminalling & Transportation Expected EBITDA Deliver 2015 expected EBITDA of in millions 285 to 315 million 310-340 300-330 Focus organic growth capital within 285-315 260-270 Southern California Distribution System Increase…
Terminalling & Transportation Investing 50 million in 2015 New Anacortes, WA products terminal Southern California pipeline interconnects Evaluating new renewable fuels unit train facility in Southern California 20
Capital Plan Overview in millions Capital Spend Cumulative EBITDA Organic Investment & Optimization Total Maintenance Base Growth Natural Gas Growth 90 110 100 225 300 200 260 250 150 160 70 60 70 70 40 2014E…
Financial Discipline Conservative 900 million revolver, expandable to 1.5 billion leverage and ample Expect leverage ratio to return to target range by end of 2015 liquidity Leverage target of 3x to 4x EBITDA Pursue balanced Maximize…
Value Proposition to Unitholders Distributions Per LP Unit Distributable Cash Flow 571 annualized in millions 50 51 90% Target coverage ratio 34 36 Since IPO in 2Q 2011 2.57 1.1x 2.46 23 25 2.36 17 16 18 20 2.26 13 14 2.18…
Continuing to Drive Unitholder Value Stable Cash Flow Long-term contracts Fee-based, inflation protected and Well-Positioned fixed minimum commitments Minimal direct commodity exposure Strong Sponsorship Assets Poised to benefit…
Appendix
Non-GAAP Financial Measures RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP (In thousands) 2011 2012 2013 2014 Tesoro Logistics LP 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Year Reconciliation of EBITDA and…
Non-GAAP Financial Measures RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP (In thousands) 2011 2012 2013 2014 Predecessors 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q 4Q Year 1Q 2Q 3Q Year Reconciliation of EBITDA and Distributable…
Non-GAAP Financial Measures Tesoro Logistics LP Distinctive Growth Strategy Annual EBITDA (In millions) Unaudited 2011A Terminalling and Gathering(1) Transportation Net earnings 17 23 Add interest and financing costs, net - -…
Non-GAAP Financial Measures Tesoro Logistics LP Distinctive Growth Strategy Annual EBITDA (In millions) Unaudited 2013A Terminalling and Gathering(1) Transportation Net earnings 33 103 Add interest and financing costs, net - -…
Non-GAAP Financial Measures Reconciliation of Forecasted EBITDA to Forecasted Net Income QEPFS Assets 2015E Forecasted Net Income 32 - 57 Add: Depreciation and amortization expense 132 Add: Interest and financing costs, net 86…
Non-GAAP Financial Measures Reconciliation of Forecasted annual EBITDA to Forecasted Net Income: Annual EBITDA Contributions from Tesoro Asset Acquisitions 2014E 2015E 2016E 2017E Forecasted Net Income 20 28 - 53 56 - 106 84 - 159…
Non-GAAP Financial Measures High Plains Crude Oil Reconciliation of Forecasted annual EBITDA Pipeline Reversal Bakken Commercial Connolly Gathering Acquisition of West to Forecasted Net Income: Project Storage System Coast Logistics…
Commercial Agreements with Tesoro Termination Provisions Fixed Minimum Initation Volume Tarrif/Fee Force Date Term Renewals Commitment Escalators Refinery Shutdown Majeure High Plains Pipeline Transportation Agreement Apr-11 10…
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