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February 2025 Annual Business Update – Kinder Morgan, Inc.

Kinder Morgan, Inc. · Feb 3, 2025 · 62 slides

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Slides

  1. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 1
    2025 Annual Business Update February 2025 Elba LNG Storage Tanks
  2. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 2
    Table of Contents Introduction 4 Delivering Energy, Improving Lives Macro Outlook 12 Strong Fundamentals Supporting Sustainable Growth Business Outlook 18 Operational Excellence & Execution 2025 Budget 30 Another Year of Robust…
  3. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 3
    INTRODUCTION Delivering Energy, Improving Lives EPNG Mojave Compressor Station
  4. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 4
    Irreplaceable Infrastructure Portfolio NATURAL GAS Delivering Energy. Improving Lives. Largest U.S. Natural Gas Transmission Network 66,000 miles of natural gas pipelines moving 40% of 65% U.S. natural gas production Interest in over…
  5. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 5
    Driving Long-Term Shareholder Value Predictable & Natural Gas Balance Sheet High-Returning Returns to Growing Cash Focus Strength Growth Projects Shareholders Flows 2/3 of cash flows 69% of cash flows 3.8x YE 2025B Net…
  6. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 6
    Highly Contracted, Predictable Cash Flows CASH FLOW MIX 95% Take-or-Pay, Fee-Based, or Hedged Cash Flows Unhedged Hedged 5% 5% Take-or-Pay 64% Entitled to payment regardless of throughput Reservation fee for capacity Fee-Based…
  7. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 7
    Strong Business Mix Continues to Improve BUSINESS MIX Natural Gas Transmission & Storage Natural Gas G&P CHANGES SINCE 2014 CO2 Refined Products Natural Gas Transmission & 27% Steady 26% Storage increased +16% 9% 19% -10% 6%…
  8. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 8
    Growing Our Project Backlog While Maintaining Discipline on Returns PROJECT BACKLOG OVER TIME(a) Expansive footprint creates opportunities Billion for differentiated returns Natural Gas Segment Other Segments 8.1 Every project…
  9. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 9
    8.1bn Committed Growth Capital Project Backlog as of 12/31/2024 25% of Backlog Capital in Service During 2025 million TOTAL Natural Gas (excluding G&P) 6,724 Mostly for LNG, Power, and LDC demand Other 277 Primarily renewable…
  10. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 10
    Positioned for Sustained Growth 2024 2025 Robust Growth and Shareholder Returns Strong Fundamentals Driving Continued Growth +7% Adj. EPS and +5% Adj. EBITDA +10% Adj. EPS and +4% Adj. EBITDA Strong Earnings Year-Over-Year Growth…
  11. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 11
    Macro Outlook Strong Fundamentals Supporting Sustainable Growth SNG Rose Hill Compressor Station
  12. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 12
    Demand for U.S. Natural Gas Projected to Grow U.S. NATURAL GAS DEMAND bcfd +28 bcfd KMI Wood Mackenzie 135 Demand is forecasted to 130 increase 20 28 bcfd by +20 bcfd the end of the decade 125 120 The biggest discrepancy…
  13. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 13
    WoodMac Natural Gas Demand Overview: 2024 2030 95% of Demand Growth is Expected to Occur in Texas & Louisiana, Driven by Exports & Industrial 2024 U.S. Demand 110 bcfd Increase in demand by 2030 +20 bcfd LNG Feedgas 1 +14 bcfd of…
  14. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 14
    LNG Exports Driving Natural Gas Demand Growth Growth Primarily Along the Texas & Louisiana Gulf Coast with Great Overlap with Our Assets WOODMAC U.S. LNG FEEDGAS FORECAST bcfd KMI has long-term contracts to move 7 bcfd to…
  15. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 15
    Growing Power Needs Boosting Demand for Natural Gas INCREASING NATURAL GAS FIRED POWER DEMAND DRIVEN BY Population Migration Coal-to-Gas Industrial Renewable Data Center & Economic Growth Conversions Reshoring Backup Demand KMI…
  16. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 16
    WoodMac Natural Gas Supply Overview: 2024 2030 2024 U.S. Production 103 bcfd Increase in supply by 2030 +20 bcfd 4 Permian +8 bcfd of associated gas growth 1 Supply grows as oil production increases & GORs rise 4 Vital to…
  17. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 17
    BUSINESS OUTLOOK Operational Excellence & Execution EPNG McClellan Creek Crossing
  18. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 18
    Natural Gas Segment Overview Connecting Key Natural Gas Resources with Major Demand Centers Largest Natural Gas Transmission Network in the U.S. KMI Transports 40% of U.S. Natural Gas Production 45% 50% 45% of all feedgas of all…
  19. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 19
    High-Quality, Natural Gas Focused Cash Flows G&P 9% Natural Gas Transportation & Storage CASH FLOW MIX(a) Accounts for 59% of 2025B KMI Adjusted Segment EBDA Remaining KM 35% 88% take-or-pay cash flows(a) Transportation &…
  20. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 20
    Rising Demand Benefitting Our Natural Gas Transportation Business INCREASED PIPELINE USAGE FACTOR(a) 2016 5-Pipe 2024 5-Pipe Increased Demand Leading To Average Average WOODMAC U.S. NATURAL GAS DEMAND 74% 87% bcfd +18% INCREASED…
  21. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 21
    7.2 Billion of Approved Natural Gas Projects Capital(a) Capacity In-Service Pursuing substantial additional Major Projects (mm) (bcfd) Date Status opportunities beyond those 1 South System Expansion 4 1,659 1.2 4Q28, Permitting…
  22. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 22
    Products Segment & Terminals Segment Overview Both Segments Principally Refined Products Focused Nearly 11bn of Adjusted Segment EBDA & 8bn of FCF Generated Over 5 Years (a) TERMINALS & PRODUCTS PIPELINES ADJUSTED SEGMENT EBDA…
  23. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 23
    Highly Utilized Products & Terminals Assets Steady Volumes with Annual Rate Escalators (a) PRODUCTS SEGMENT VOLUMES TERMINALS SEGMENT LEASED mbbld CAPACITY PERCENTAGE & TONNAGE +1% 2.1mmbbld 2025 budgeted -3 % +1 % Flat volumes…
  24. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 24
    Leveraging Our Existing Assets to Meet Growing Demand for Renewable Fuels and Feedstocks PRODUCTS Ability to throughput combined 57mbbld of RD at Capacity Northern and Southern California hubs today Truck Rack Storage West Coast RD…
  25. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 25
    CO2 Segment: EOR and CO2 Transport Overview World Class, Fully-Integrated Assets Consistently Generating Robust Free Cash Flow CO2 EOR & TRANSPORT FREE CASH FLOW Interest in 3 oil CO2 pipelines Millions fields with 8.8 CO2 source…
  26. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 26
    CO2 Segment: Energy Transition Ventures (ETV) Group Overview Pursuing Commercial Opportunities Emerging from the Lower Carbon Energy Evolution Future RNG CCS Opportunities Established a growing RNG platform Evaluating commercial…
  27. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 27
    Committed to Being a Good Steward Reduce & Leak Safety Continuous Diversity & Investing in Lower Avoid Methane Detection Culture Improvement Inclusion Carbon Fuels Emissions 8% 100% 42% BB AAA 33% 7.3bn Reduction in Of our…
  28. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 28
    Highly Rated by Sustainability Ratings Agencies Upgrade by MSCI to AAA in 2024 MSCI AAA Sustainalytics Top 15% SSGA Top 10% Oil & Gas Refining, out of 106 Oil & Gas R-Factor in Marketing, Transportation Storage and Transportation…
  29. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 29
    2025 BUDGET Another Year of Robust Financial Growth EPNG Eunice Compressor Station
  30. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 30
    Capital Allocation Priorities High-Quality and Secure Cash Flows Natural gas focused, long-term, take-or-pay cash flows Balance Sheet Strength Capacity provides value and flexibility Disciplined Capital Allocation Investing in…
  31. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 31
    Growing Earnings While Reducing Leverage and Returning Meaningful Value to Shareholders ADJUSTED NET DEBT / DIVIDENDS PAID & EPS ADJUSTED EBITDA SHARES REPURCHASED(b) Billion 8% CAGR 28% decrease in 23 billion returned leverage to…
  32. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 32
    2025 Budget Highlights Adjusted Adjusted Net Debt / Discretionary Cash EPS EBITDA Adj. EBITDA Capital(a) Returns 1.27 8.3bn 3.8x 2.3bn 2.6bn 10% increase 4% increase -0.2x decrease infrastructure projects dividends expected…
  33. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 33
    Steady Base Business & Growth From Investments 2024 2025B ADJUSTED EBITDA BRIDGE Billions 0.0 0.3 8.3 7.9 2024 Base Growth(a) 2025B Adjusted EBITDA Business Projects Adjusted EBITDA Note: Adjusted EBITDA is a non-GAAP…
  34. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 34
    2025B Adjusted Segment EBDA, Adjusted EBITDA, and Adjusted Net Income Attributable to KMI in Millions 2025 2024 Change Budget Actual % 2025B KEY DRIVERS Natural Gas Pipelines Adjusted Segment EBDA (a) 5,636 5,439 197 4% Contributions…
  35. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 35
    2025B Adjusted EPS in Millions, Except Per Share 2025 2024 Change Budget Actual % Net income attributable to KMI 2,829 2,613 216 8% (a) Total Certain Items 2 (42) 44 105% Adjusted Net Income attributable to KMI 2,831 2,571 260 10%…
  36. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 36
    2025B Discretionary Capital Expenditures in Millions 2025B KEY PROJECTS 2025 2024 Discretionary Capital Budget Actual Discretionary Capital Natural Gas Pipelines (a) 1,854 1,348 TX Intrastate Trident project Products Pipelines 72 79…
  37. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 37
    2025B Cash Flow from Operations (CFFO) & Free Cash Flow (FCF) in Millions 2025 2024 Change Budget Actual % Net income attributable to KMI 2,829 2,613 216 8% Net income attributable to noncontrolling interests 106 107 (1) (1%) DD&A…
  38. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 38
    2025B Sources & Uses(a) in Millions SOURCES & USES 2025 Billions Sources Budget 8.0 CFFO (GAAP) 5,899 Other Uses Other Sources Revolver Borrowing/Debt Issuances 1,377 7.0 Distributions from equity investments in CFFI(b) 411…
  39. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 39
    2025B Leverage & Liquidity(a) in Millions 2025 KMI LONG-TERM DEBT MATURITIES(e) Budget Debt maturities Weighted average interest rate Net Debt (Year End) 31,408 Adjusted EBITDA 8,284 5.5% Net Debt(b) to Adjusted EBITDA 3.8x(c)…
  40. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 40
    2025B Quarterly Profile ADJUSTED EBITDA ADJUSTED EPS Billions 2025 Budget 2024 Actuals 2025 Budget 2024 Actuals 2.22 2.17 2.14 2.06 1.97 1.92 0.37 1.88 1.86 0.35 0.34 0.32 0.28 0.26 0.25 0.25…
  41. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 41
    Cash Taxes: Do Not Expect to Be a Material Cash Taxpayer Until 2026 KMI PROJECTED EFFECTIVE FEDERAL CASH TAX RATE 20% Do not expect KMI to be a material federal income taxpayer in 2025 15% 312 million of General Business…
  42. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 42
    APPENDIX Liberty RNG Facility
  43. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 43
    Contract Strategy Insulates Cash Flows Through Commodity Cycles Structure Long-Term Contracts That Minimize Price & Volume Volatility Take-or-Pay or Hedged Fee-Based Commodity- Avg. remaining Volumes & price are Price is fixed,…
  44. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 44
    2025 Budget Sensitivities Limited Overall Commodity Exposure 2025B Assumptions Change Potential Impact to Adjusted EBITDA (Full Year) Natural Gas Products Terminals CO2 Total Natural gas G&P volumes 4,125 bbtud +/- 5% 32.8 million…
  45. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 45
    2025B Sustaining Capital Expenditures in Millions 2025B KEY DRIVERS 2025 2024 Sustaining Capital Budget Actual Change Sustaining Capital Natural Gas Pipelines (a) 623 703 (80) Fewer compressor repairs Products Pipelines 171 172 (1)…
  46. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 46
    Customers Are Primarily End-Users of the Products We Handle Net Revenues Underpinned by Investment Grade Counterparties & Credit Support Ratings as of January 10, 2025 CUSTOMER TYPE CREDIT RATING End-user IG or substantial credit…
  47. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 47
    Natural Gas Projects Placed Into Service During 2024 IN-SERVICE DATE: 2024 CAPACITY KM SHARE ASSET PROJECT Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec (mDthd) CAPITAL (mm) Evangeline Pass Phase I 900 283 Port Sulphur Dispatch 235…
  48. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 48
    7.2 Billion Natural Gas Project Backlog KM SHARE CAPACITY ASSET PROJECT CAPITAL (mm) (mdTHD) IN-SERVICE DATE PROJECT STATUS Mississippi Crossing 1,637 2,100 4Q28 Permitting Evangeline Pass Project 293 1,100 3Q25 Under construction…
  49. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 49
    Tankers Meeting Domestic Maritime Demand Largest Jones Act Tanker Fleet and Most Efficient Vessels American Petroleum Tankers (c) Firm Charter Renewal Option 16 fuel-efficient Jones Act tankers YE-24 2025 YE-25 2026 YE-26 2027…
  50. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 50
    CO2 EOR & Transport Budget and Sensitivities Potential Impact to SACROC Other EOR CO2 & Transport Adj. EBITDA 2025B Assumptions Change (full year) 320 Crude oil & NGL production +/- 5% in net volumes 35.5 million 34 mbbld net CO2…
  51. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 51
    CO2 Segment Budgeted Volumes & Highlights 2025B NET OIL & NGL PRODUCTION 2025B NET CO2 SALES mbbld mmcfd McElroy 1.1 Yates 5.9 SACROC 141 34.1 mbbld SACROC Oil Third parties 171 329 mmcfd 18.7 SACROC NGL 8.5 Yates 17…
  52. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 52
    Joint Venture Treatment in Key Metrics KM does not control nor consolidate KM controls & fully consolidates KM portion referred to as equity investments in Third party portion referred to as noncontrolling interests in financial…
  53. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 53
    NON-GAAP FINANCIAL MEASURES & RECONCILIATIONS Altamont Ravolla Compressor Station
  54. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 54
    Net Income, Adjusted Net Income Attributable to KMI, and DCF in millions 2025 2024 Change Budget Actual % Net income attributable to KMI 2,829 2,613 216 8% Certain Items Change in fair value of derivative contracts - 72 (72) (100%)…
  55. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 55
    2014 and 2025B Reconciliation of Segment EBDA to Adjusted Segment EBDA in millions 2025 2014 2025 2014 (a) (a) Segment EBDA Budget Actual Segment EBDA Budget Actual Natural Gas Pipelines Segment EBDA 5,636 4,288 CO2 Segment EBDA 755…
  56. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 56
    2024 Reconciliation of Recasted Adjusted Segment EBDA in millions 2024 2024 (a) (b) Segment EBDA Actual Adjustment Recasted Natural Gas Pipelines Segment EBDA 5,427 (34) 5,393 Certain Items (c) - Change in fair value of derivative…
  57. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 57
    Reconciliation of Adjusted Net Income Attributable to Common Stock and Adjusted EPS in millions 2016 2017 2018 2019 2020 2021 2022 2023 2024 Net income attributable to KMI 708 183 1,609 2,190 119 1,784 2,548 2,391 2,613 NCI associated…
  58. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 58
    Reconciliations of KMI FCF and CO2 EOR & Transport FCF in millions Reconciliation of KMI FCF 2020 2021 2022 2023 2024 2025B CFFO (GAAP) 4,550 5,708 4,967 6,491 5,635 5,899 Capital expenditures (GAAP)(a) (1,707) (1,281) (1,621) (2,317)…
  59. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 59
    Reconciliations of Terminals FCF and Products Pipelines FCF in millions Reconciliation of Terminals FCF 2020 2021 2022 2023 2024 2025B EBDA for Terminals (b) 1,045 908 975 1,039 1,099 1,103 Certain items: Loss (gain) on impairments,…
  60. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 60
    Reconciliation of Adjusted EBITDA, Normalized for Divestitures in millions Reconciliation of Adjusted EBITDA, Normalized for Divestitures 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025B Net income attributable to KMI 708 183 1,609…
  61. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 61
    Reconciliation of Net Debt in millions Reconciliation of Net Debt 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025B Current portion of debt 2,696 2,828 3,388 2,377 2,558 2,646 3,385 4,049 2,009 1,209 Total long-term debt 37,354 35,015…
  62. February 2025 Annual Business Update – Kinder Morgan, Inc. – slide 62
    Reconciliation of Adjusted Net Income Attributable to KMI Excluding Uri in millions 2021 2021 Actual Reconciliation of Adjusted Net income attributable to KM Actual Excluding Uri Net income attributable to KMI 1,784 932 Certain Items…

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