Regency Energy Partners LP 2014 Investor Day November 17, 2014
Forward-Looking Statements Certain matters discussed in this report include forward-looking statements. Forward-looking statements are identified as any statement that does not relate strictly to historical or current facts. Statements…
Agenda 1. Overview & Strategy Mike Bradley, President & CEO 2. Natural Gas Transportation and Jim Holotik, EVP & Chief Commercial Officer Gathering & Processing Overviews 3. Integration & Synergies Update Jennifer Street, Vice…
Overview & Strategy
Major Transformation Since Last Investor Day Extensive midstream portfolio and strong position in majority of high-growth shale plays driving expansion opportunities Completed approximately 9 billion in strategic acquisitions Growth…
Highlights Since 2013 Investor Day Acquisitions - 9 Billion Adjusted EBITDA & DCF 500 300 250 400 215 SUGS PVR Partners 344 200 in millions 300 150 a 200 155 101 Hoover Energy EROC Energy 100 Midstream Midstream 100…
Substantially Increased Footprint Transformed into a larger, more diverse G&P midstream provider with strong positions in 5 strategic basins Contract Services segment has expanded its existing positions and has added 4 new shale plays…
Significant Portfolio Growth & Diversification Acquisitions and organic growth are driving a more balanced and diversified portfolio Margin By Business 3% 3% 3% FY 2012 8% 8% 8% 17% 17% 17% FY 2015E 14% 14% 14% 8% 3% 8% 7%…
Scale & Position Driving Increased Organic Growth Organic Growth Backlog Acquisition Growth Drivers 3,000 PVR Growth Drivers Utica Ohio River Gathering JV 2,600 Lycoming Expansion East Clinton Expansion 2,500 SUGS Growth Projects…
Visibility for Future Earnings & Distribution Growth Major Announced Growth Projects Eagle Ford Expansion Mi Vida Processing Plant & Processing Gathering Dubberly Liquids Express Pipeline Dubberly Cryo Processing…
2015 Objectives Leverage Integrated Maintain Stable Execution Invest In Growth Midstream Platform Cash Flows Focus on growing DCF/unit Utilize integrated platform Offer fully integrated Maintain high percentage of of assets to…
Transportation and Gathering & Processing: Asset Overview Gathering & Processing Asset % April 2013 September 2014 Summary Growth Total Processing Capacity (MMcf/d) 930 2,700 190% Total Gas Treating Capacity (MMcf/d) 1,320 1,965…
Accomplishments Since Investor Day 2013 Total G&P throughput increased by 161% and NGL production by 100% since Q2 2013 Acquired Hoover midstream assets, expanding gas, oil and water gathering capabilities Permian Increased cryogenic…
Intrastate Transportation: RIGS Interruptible volumes on RIGS associated with new Cotton Valley drilling around Terryville gathering system have risen over the course of the year RIGS Haynesville Joint Venture Partnership Structure…
Interstate Transportation: MEP MEP Joint Venture Partnership Structure MEP Details Capacity / 1.8 Bcf/d 50/50 Joint Venture with Kinder Morgan Pipeline Length 500 miles Kinder Morgan operates the assets on behalf of the Joint…
Gathering and Processing: South Texas Total South Texas gathering throughput increased 14% since Q2 2013 South Texas Asset Map Capacity 2014 Total Treating Capacity (MMcf/d) 350 Total Condensate Gathering Capacity 37,000…
Gathering and Processing: Ark-La-Tex Increased Ark-La-Tex throughput volumes by 50% and NGL production by 74% since Q2 2013 Ark-La-Tex Asset Map Capacity 2014 Total Processing Capacity (MMcf/d) 758 Total Treating Capacity (MMcf/d)…
Gathering and Processing: Permian Increased gathering throughput by 50% and NGL production by 38% since Q2 2013 Permian Asset Map Capacity 2014 Total Processing Capacity (MMcf/d) 940 Total Treating Capacity (MMcf/d) 890…
Gathering and Processing: Eastern Region Total Eastern region volumes grew 36% to 1.9 million MMbtu/d since Q2 2013 East Texas Asset Map Capacity 2014 Total Interconnect Capacity (Bcf/d) 2.2 Accomplishments Expanded delivery into…
Utica Ohio River Joint Venture Utica Ohio River Joint Venture creates a first-mover advantage, and will be a key take-away option for Utica lean-gas Utica Ohio River Project Commercial Highlights Joint Venture between Regency and…
Gathering and Processing: Mid-Continent Increased Mid-Continent throughput volumes over 400% since Q2 2013 with PVR and EROC acquisitions Mid-Continent Asset Map Capacity 2014 Total Processing Capacity (MMcf/d) 900 Total Treating…
Gathering & Processing Opportunities Summary Mid-Continent Creating super system to increase Bone Spring/Permian flexibility and capture new gas, oil and water opportunities Additional 400 MMcf/d cryogenic Constructing storage and…
Integration & Synergies Update
Combined EROC and PVR Synergies Overview Total Combined PVR and EROC Synergy Savings on an Annual Basis: 85M+ with Upside Potential Year-Over-Year 15% in headcount consolidation Synergies Execution G&A Savings Elimination of…
NGL Services: Highlights Announced Projects Lone Star Express NGL Pipeline Conversion of existing 12 NGL line to crude oil service Fractionator III Mariner South expected in-service by year end Volume Growth Volumes transported…
NGL Services: Assets NGL Storage Pipeline Transportation Fractionation and Processing 53 Million barrels NGL storage 2,000+ miles of NGL Pipelines Two 100,000 Bpd fractionator at Mont Permitted to drill additional 8 caverns 400 Mbpd…
NGL Services: Integrated Assets Allow For Synergies Across Family Lone Star West Texas Pipeline 12 (140 Mbpd) ETP Godley 1, 2, 3, 5 RGP Keystone ETP Freedom/Liberty RGP (75 Mbpd) RGP ETP Rebel Jal Red Bluff ETP Justice 20…
NGL Services: Lone Star Express Pipeline 533 miles of new 24 and 30 NGL pipelines from the Permian Basin to Mont Belvieu Capacity Initial scope of 375 MBPD Expandable up to 495 MBPD Contracted volumes in excess of 200 MBPD…
NGL Services: Lone Stars Mont Belvieu Complex Frac IV , V , IV Frac I 100 Mbpd Dec 12 Frac II 100 Mbpd Oct 13 Frac III 100 Mbpd Dec 15 De-C2 100 Mbpd Nov 14 35
NGL Services: Mariner South 36
Contract Services
Contract Services: Asset Offerings Contract Gas compression packages ranging Compression from 75 HP to 3,550 HP Amine Removal of CO2 and/or H2S Treating 5 GPM to 400 GPM CDM Resource Management Merged Into Fuel Gas Reduce…
Contract Compression: Asset Overview CDM is well positioned to provide fee-based, turn-key services in the majority of all shale plays and equipped to capitalize on those that are currently experiencing increased drilling activity…
Contract Services: 2015 Outlook Significant increase in demand for compression in shale plays, which is expected to continue throughout 2015 Horsepower By Shale Play Target Shale Plays for Expansion 2015 Opportunities and Growth…
Production Services: Asset Overview Treating business is well positioned in several rapidly growing shale plays, which is expected to allow CDM to capitalize on increased activity and production Marcellus/ Utica Niobrara Asset…
Production Services: 2015 Outlook In 2014, have experienced an increase in sales coverage and diversified customer base as a result of the successful integration of the treating and compression sales teams 2013 Revenue by Asset Assets…
Contract Services: Where We Are Going In summary, the contract services segment presents tremendous opportunities and upside potential driven by demand from existing and developing shale plays Opportunities Summary Continue to focus…
Financial Review
Financial Objectives Q3 2014 marked Regencys sixth consecutive increase in quarterly distributions, Distribution Growth representing 9% distribution growth over the period LTM distribution coverage through Q3 2014 was 1.00x…
Distributions Since Q2 2013, RGP has delivered 6 consecutive distribution increases, including the 0.0125/unit increase in Q3 2014, which represents 2.01 per unit on an annual basis 0.5025 0.50 0.49 0.48 0.48 0.475 0.47…
Capital Markets Update Revolving Credit Facility Launched amendment early this month Increased size by 500 million up to 2 billion Improved pricing and terms Extended maturity to 5 years Expected to close on November 21, 2014…
Debt Maturity Profile Debt complex is well-balanced, with no maturities in the next 3 years Weighted average interest rate will be 5.74% after 6.875% notes are redeemed next month 2,500 2,500 2,000 2,000 1,500 5.00…
Organic Growth Project Backlog Major Projects 2015 Growth Capital Total Backlog ( in Millions) 800 1,600 Gathering & Processing Mi Vida Processing Facility 1 Dubberly Liquid Express Pipeline Dubberly Processing Expansion Eagle…
Diverse Portfolio In the past 3 years, Regency has grown EBITDA by over 300%, driven by strategic acquisitions and accretive organic growth projects Recent acquisitions have significantly increased Regencys gathering and processing…
Strong Fee-based Cash Flows Currently, over one-third of 2015 commodity exposure is hedged Target having two-thirds of commodity hedged for 2015 Adjusted Total Segment Margin FY 2012 FY 2013 FY 2014 Estimated FY 2015 Target…
DCF Sensitivities DCF Sensitivity to Commodity Price Changes Full Year 2015 Commodity /Move Impact Natural Gas +/- 0.25/MMbtu +/- 7M NGLs +/- 0.05/gallon +/- 5M Condensate +/- 5/barrel +/- 7M A 5.00/bbl movement in crude…
Conclusion
Conclusion Strong Completed more than 10.5 billion in organic growth and acquisitions in the last two years Visibility for Project backlog of approximately 2.6 billion expected to increase Growth High-Quality Assets strategically…
Appendix
Maintain Stable Cash Flows: Comprehensive Hedging Program Executed Hedges by Product1 Balance of Full Year 2015 Full Year 2016 2014 Natural Gas/Ethane 73% 49% - C3 to C4 60% 29% - C5+/Condensate 88% 37% 23% 1 As of…
Maintain Stable Cash Flows: Comprehensive Hedging Program Executed Hedges by Product1 Balance of 2014 Full Year 2015 Full Year 2016 Price Price Price Bbls/d Bbls/d Bbls/d (/gal) (/gal) (/gal) Propane 3,989 1.05 1,900 1.05 - -…
FY 2015E Margin by Type Mid-Continent Permian 1% 0% 19% 29% 0% 41% 36% Eastern 39% 23% 12% Gas NGL Condensate Fee Helium Gas NGL Condensate Fee Ark-La-Tex South Texas 0% 0% 100% Fee 8% 6% 4% 5% 5% 88%…
Non-GAAP Reconciliations Three Months Ended September 30, 2014 June 30, 2014 March 31, 2014 December 31, 2013 September 30, 2013 June 30, 2013 ( in millions) Net income (loss) 107 (4) 12 3 42 11 Add (deduct): Operation and…
Non-GAAP Reconciliations Three Months Ended September 2014 June 30, 2014 March 31, 2014 December 31, 2013 September 30, 2013 June 30, 2013 ( in millions) Net income (loss) 107 (4) 12 2 42 11 Add: Interest expense, net 86 78 56 45 41…
Non-GAAP Reconciliations Three Months Ended September 30, 2014 June 30, 2014 March 31, 2014 December 31, 2013 September 30, 2013 June 30, 2013 ( in millions) Net cash flows provided by operating activities 293 90 187 59 183 112 Add…
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