Steady as we grow 2014 INVESTOR DAY TSX: PPL; NYSE: PBA March 5, 2014 1
Our team presenting today Agenda Presenter Introduction Scott Burrows Mick Dilger President & Chief Executive Officer Overview & Value Proposition Mick Dilger Market Dynamics Scott Burrows Peter Robertson Senior Vice President,…
Meet our new President & CEO As of January 1, 2014, Mick Dilger became Pembina's CEO and a member of the Board of Directors With Pembina since 2005, previously held positions of Vice President, Business Development (2005 2008),…
We are celebrating our 60th anniversary 5
Corporate overview video Pembina Oil Field, Main Pump Station, 1956 6
OVERVIEW & VALUE PROPOSITION Mick Dilger
Our asset base is ideally located Map for illustrative purposes only. 8
We remain steadfast in our objective & strategy OBJECTIVE: To provide highly competitive and reliable returns to investors through monthly dividends while enhancing the long-term value of our shares. STRATEGY: Preserve value by…
Pembina is a unique investment opportunity Pembina represents a pure play midstream company that allows investors to participate in the resurgent volume growth of the Western Canadian Sedimentary Basin Well-Positioned Strong…
We are realizing the potential of our Provident acquisition Integration fully realized Potential Transaction Target/ Actual Systems and policies in conformity Benefits Previous New Senior VP structure Asset transfers optimize…
We have an established track record 10 21 % CAGR % CAGR in ACFPS in operating margin 2004 2013 2004 2013 2.50 1,000 900 Adjusted Cash Flow Per Share 2.00 800 700 1.50 600 ( millions) 500 1.00 400 300 0.50…
We continue driving shareholder value 500 % total return* * Jan 1, 2004 Dec 31, 2013, inclusive of dividends reinvested 4.6 % CAGR in dividends per share* * 2004 - 2013 2.8 billion in dividends paid since…
We produce exceptional performance relative to our peers Significant total return outperformance in 2013 calendar year of both the composite index (+25%) and average peer performance (+20%) 10 Year Total Return PPL vs. S&P/TSX1 2013…
We are one of Canada's largest companies S&P/TSX 60 Potential Candidates by Float Quoted Market Value1 14 Float Quoted Market Value ( billions) 12 10 8 6 4 2 - Pembina has strong case for S&P/TSX 60 inclusion 1…
We have an ambitious portfolio of growth projects 9,000 Converted 2012 unrisked portfolio into 3.5 billion of 8,000 Unrisked secured projects in 2013 33%* 7,000 2013+ growth portfolio has Capital Expenditures ( millions)…
We are driving incremental operating margin growth 1,200 Potential to double current Anticipate growth in 1,000 operating margin both liquids and NGL Potential Incremental Operating Margin ( millions) 800 (949 million in 2013)…
Our capital program is focused on fee-for-service projects Capital Project Business Contract Type In-Service (CMM) Phase II Crude Oil, Condensate & NGL Expansions Conventional Pipelines Fee-for-Service 695 2014-2015 Phase III…
And we are securing fee-for-service cash flows... 6% 7% 15% 10% 17% 23% 79% 67% 76% 2014 2016 2018 Fee-for-Service / Cost-of-Service Product Margin Frac Spread Operating margin from…
MARKET DYNAMICS Scott Burrows
Crude oil & natural gas pricing support E&P 160 140 120 100 US / BBL 80 60 WTI 40 Brent 20 - 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 16 14 US / MMBTU 12 10 8 Henry Hub 6 AECO (US) 4 2 0…
Alberta ethane supply/demand increasing 400 Supply from oil sands off-gas Import from Vantage Pipeline Ethane production Supply from conventional gas mainly sold under Alberta Ethane Supply & Demand (mbpd) Alberta Demand…
Downward trend in propane inventories 60 8 7 50 6 40 CDN Inventories (MMBbls) US Inventories (MMBbls) 5 30 4 3 20 2 10 1 - - 2009 2010 2011 2012 2013 Current US Inventories CDN Inventories…
US propane exports are increasing The US has become the world's largest Strong emerging market demand continues propane exporter to support international arbitrage markets 2.00 160 2014F 140 1.75 Spread significantly…
Butane pricing faces pressure from growing supply 2.40 100% 90% 2.20 80% 2.00 70% US / GAL % Of WTI 60% 1.80 50% 1.60 40% 1.40 30% 20% 1.20 10% 1.00 - 2011 2012 2013 2014 Mont. Belvieu Edmonton Edmonton…
Condensate pricing remains strong in Alberta 130 140% 120 120% 110 100% US / BBL % of WTI 100 80% 90 60% 80 40% 70 20% 60 - 2011 2012 2013 2014 1 Edmonton Condensate Mont Belvieu Condensate Condensate Price…
Key takeaways US propane export capacity has more than doubled and inventories are at multi-year lows Current outlook for butane demand in western Canada is modestly positive for the near-term (long-term, a new outlet may be…
STRATEGY & FOCUS Mick Dilger
We have four growth platforms Conventional Gas Oil Sands & Midstream Pipelines Services Heavy Oil Growth across the hydrocarbon value chain 32
And a customer focused service offering Conventional Gas Services Midstream Pipelines Mainline Extraction 60% of 2014 capex Production Gathering, Processing, HVP Feeder Consumption Field Pipelines Terminalling Logistics…
And we have ideally located assets Map for illustrative purposes only. ATHABASCA OIL SANDS SLAVE POINT MONTNEY FORT FORT ST. JOHN MCMURRAY SEAL PELICAN LAKE VALLEYVIEW GRANDE PRAIRIE SWAN HILLS SWAN HILLS DEEP BASIN…
GROWTH & DEVELOPMENT Paul Murphy
We are strongly positioned in the Deep Basin Deep Basin Production Forecast Deep Basin Well (NPV9 Sensitivity +/-20% CMM)1 7,800 1,300 Pre 2008 2008 2009 7,200 1,200 Commodity Prices 6,600 2010 2011 2012 1,100 Total Production…
...And in the Cardium Cardium Production Forecast Cardium Well Economics (NPV9 Sensitivity +/-20%)1 450 Pre-2008 2008 2009 2010 450 400 2011 2012 2013 2014 400 Commodity Prices Liquids Production (MBoe/d) 2015 Liquids Total…
As well as the Montney Montney Production Forecast Montney Well Economics (NPV9 Sensitivity +/-20% CMM)1 4,800 Pre 2008 2009 2010 800 4,200 2011 2012 2013 700 Commodity Prices Liquids Production (MBoe/d) 2014 2015 Liquids…
And we are capturing the potential of the Duvernay Duvernay Liquids Production Forecast Duvernay Well Economics (NPV9 Sensitivity +/-20%)1 450 Pre-2012 2012 2013 450 400 2014 2015 2016 400 Commodity Prices Liquids Production…
CRUDE OIL VALUE CHAIN FOCUS Paul Murphy
Our services span the crude oil value chain Midstream: Midstream: Full service terminals treat hydrocarbons to meet Store products on a fee-for-service and proprietary basis pipeline specifications Custom products for customers…
In Conventional Pipelines 720 mbpd current 8,500 throughput kilometres capacity1 of pipeline 50 % (and growing) of Alberta's conventional crude oil production transported on Pembina's systems 30 % (and growing) of…
We are an industry leader Operational excellence ALBERTA 99% reliable FORT ST JOHN TAYLOR DUNVEGAN FORT MCMURRAY Proximal to prolific geology Q4 2013 throughput: 500 VALLEYVIEW mbpd (4% increase from Q4 GRANDE PRAIRIE SWAN…
with a solid business platform 100% of revenue is fee-for-service No direct commodity exposure Expansions underpinned by long-term contracts Established infrastructure captures incremental production from major resources plays…
We are investing to drive growth 4,000 2014 Capex 3,500 455 million for Phase II Expansions* Capital Expenditures ( millions) 3,000 295 million on Phase III 2,500 Expansion* (including Simonette) 2,000 2015+ Capex…
and to support growing throughput Solid industry performance combined with strategically located assets has led to strength in Pembina's throughput profile 600 500 400 (mbpd) 300 200 100 - 2004 2005 2006…
Our Phase II Expansions are on track Phase II LVP To-Date Ordered 70% of long-lead equipment Phase II (LVP & HVP) 100% of stakeholder consultation underway Capital Breakdown 60% of costs secured Next Steps Expect to obtain…
We are debottlenecking our systems Simonette Pipeline Expansion Details Constructing new pipeline between Simonette and Fox Creek, Alberta with initial capacity of 150,000 bpd Incremental volumes will access Phase I and II Peace…
And our Phase III Expansion, at 2 billion, is our largest project ever FT. ST. JOHN TAYLOR 1,000 mbpd ultimate capacity on Peace & Northern Pipelines GORDONDALE 320 DAWSON CREEK mbpd initial capacity between Fox Creek…
And we are setting the stage for future growth PHASE III EXPANSION: Underpinned by long-term transportation services agreements with 30 customers Ten-year take-or-pay for volumes that average over 230,000 bpd or 75% of initial…
We are making great progress Three separate pipeline projects to achieve initial capacity: Kakwa to Simonette, Simonette to Fox Creek (pre-build) and Fox Creek to Namao Currently in initial stages of consultation with communities,…
Our expansions could bring capacity to 1.4 million bpd 1,400 1,400 mbpd 1,200 1,000 320 800 53 55 mbpd 52 40 600 175 400 453 200 Pre-Expansion Phase I Phase II Phase III Phase III (Ultimate Total…
In Oil Sands & Heavy Oil... 5 pipeline systems: oil sands, heavy oil, diluent 880 mbpd contracted capacity 10-25 year contract life 53
We are an industry leader Syncrude Pipeline Horizon Pipeline Operational excellence Cheecham Lateral Nipisi Pipeline 99% reliable over Mitsue Pipeline Peace Pipeline operating history Diverse connectivity to various industry…
With a solid business platform PIPELINE SYSTEM SYNCRUDE HORIZON CHEECHAM NIPISI & MITSUE Contracted Capacity 389,000 250,0001 136,000 127,000 (bpd) Contract Type Cost-of-Service Fixed Return Fixed Return Fixed Return Initial…
We are investing to drive growth 1,600 2014 Capex 1,400 60 million: 1,200 Capital Expenditures ( millions) 35 million to progress 1,000 engineering support agreement (ESA) for 800 potential Cornerstone 600 Pipeline and…
And we are pursuing a new opportunity Signed 35 million ESA CNRL HORIZON Commenced stakeholder consultation and progressing engineering SYNCRUDE Application expected to be filed by end of September FORT MCMURRAY Proposed…
Our Oil Sands & Heavy Oil business' capacity could see another step-change 1,400 1,300 mbpd 1,200 1,000 32 800 95 mbpd 250 600 136 400 114 200 275 Syncrude Syncrude Cheecham Lateral Horizon Nipisi &…
Supported by our substantial access to diluent and synthetic crude supply... Connected Condensate Supply: Pembina Conventional Pipelines Redwater Fractionator Southern Lights Pipeline Rail import Proposed Cochin Pipeline reversal…
And we have many growth opportunities ahead of us Progressing Cornerstone Pipeline under ESA and commercial efforts* Potential to up-size diluent line Portions of both Nipisi and Mitsue are expandable in the future (pre-built with…
In Crude Oil Midstream 21 13 inbound outbound pipeline pipeline connections 40 connections mbpd of crude oil rail loading capacity 3 16 truck terminals hub locations in located across Edmonton area pipeline network…
We are an industry leader Develop and provide ALBERTA terminal, hub and storage services to support the energy TAYLOR FORT MCMURRAY industry 630,000 barrels of above ground crude oil and condensate storage capacity PRINCE…
With a solid business platform Revenue generated from multiple service offerings Liquids capture and terminalling support growth for other Pembina businesses Interconnectivity increases options for customers Access to 5 diluent…
We are investing to drive growth 500 2014 Capex 450 50 million to complete one full- service terminal and initiate four full- 400 service terminals Capital Expenditures ( millions) 350 45 million to begin expansion of above…
In the Pembina Nexus Terminal's Edmonton/Fort Saskatchewan areas Crude oil Dilbit Synthetic Crude Diluent Heavy Export Red indicates Pembina- owned existing and proposed pipelines and connections Dashed lines and/or grey…
Our Heartland Hub is positioned for future growth Future receipt and delivery terminal Enable additional value-added services i.e. merchant storage and other complementary midstream services Provide interconnectivity via pipeline…
And we are building out our network of truck terminals and full-service terminals Construction at Pembina's Fox Creek Truck Terminal completed and brought into service in December 2013 25% of capacity under volume commitments Volumes…
And we have many options for us to grow PNT expansion Heartland development Hardisty development Terminal integration Surface and salt cavern Future terminalling and storage storage Redwater, PNT-E and Proximity to CP rail…
Crude oil value chain summary 1,800 4% 40% of Pembina's 1.7 1,600 15% billion 2014 capital 1,400 9% spending plan is directed 1,200 to crude oil value related 21% 1,000 activities ( millions) 800 Focus remains on…
BREAK 72
NGL VALUE CHAIN FOCUS Stuart Taylor
Our services span the NGL value chain Gas Services: Conventional Pipelines: Field gas gathering Transports NGL from gas plants to markets or to Gas processing including both shallow and deep Pembina's fractionator at Redwater and…
In Gas Services 375 368 km of gas MMcf/d net gathering capacity1 pipelines 405 MMcf/d enhanced liquids extraction capacity 1.2 bcf/d of net processing capacity by end of 2015 1The Cutbank Complex has gross capacity of…
We are an industry leader Operational excellence Gas Processing Plant Redwater Fractionator 96% reliable PEACE PIPELINE Pembina Conventional MUSREAU Pipelines Regional wells contain total FACILITY Pembina Gas Services…
With a solid business platform Strategically positioned infrastructure in active and emerging NGL-rich plays Provide gas gathering, compression and shallow/deep cut processing services 100% fee-for-service revenue (no direct…
Market fundamental support demand for our services Shallow cut: Deep cut (enhanced extraction): Separation and recovery of an NGL mixture of Separation and recovery of a higher amount of higher density hydrocarbons from raw natural NGL…
We are investing to drive growth 1,000 900 2014 Capex 800 80 million to complete the Resthaven Facility Capital Expenditures ( millions) 700 80 million for the 600 Musreau II Facility 500 100 million for the 400…
And to support growing volumes 500 Saturn I: 400 in-service (MMcf/d) 300 200 100 - 2009 2010 2011 2012 2013 YTD 2014 1 Gas processing volume 1 As of January 1, 2014 to February 26, 2014. Volumes at…
We are expanding to meet customer demand 1,198 MMcf/d 1,200 60,000 200 1,000 50,000 100 130 800 40,000 bpd (NGL and C5 output) 200 MMcf/d 600 30,000 50 400 205 Additional 56% of contracted 20,000 growth by end…
2013 was a year of accomplishments Saturn I (in-service) To-Date Fully-contracted 200 MMcf/d Project was on-time and on-budget January 2014 operations: Reliability at 100% Utilization at 99% with 197.8 MMcf/d Resthaven…
As we continue to grow our fee-for-service offerings Musreau II (constructing 110 MM facility) To-Date 100 MMcf/day shallow cut gas plant Underpinned by long-term contracts for 100% of capacity Expected to yield 4,200 bpd of NGL for…
And we have many opportunities to pursue Gas plants to support producer development and growth of the Duvernay and Montney Hydrocarbon stabilization required as free liquid content in some play areas very high (up to 300…
Our NGL services are supported by our conventional pipelines 55,000 bpd of NGL from Pembina's existing and in- development gas plants expected to use over 52% of the Phase I and II NGL pipeline expansion capacity See…
At Redwater West in NGL midstream 73 mbpd fractionation capacity 355 MMcf/d net extraction capacity1 7.8 MMbbls net specification product storage 1 The Younger extraction facility has gross capacity of 750 MMcf/d. 86
and at Empress East in NGL midstream 2.1 bcf/d net extraction capacity 20 mbpd net fractionation capacity 6.2 MMbbls net specification product storage 87
We are an industry leader Map for illustrative Redwater West: purposes only. Gas Processing Plant 73 mbpd NGL fractionator and 7.8 mmbbls Redwater Fractionator of finished product cavern storage Midstream Storage Facility Truck…
We are investing to drive growth 1,200 2014 Capex 1,000 365 million to progress RFS II and propane-plus Capital Expenditures ( millions) 800 optimization at RFS I as well as third-party storage and terminalling solutions…
And to support growing customer demand RFS II: Doubling size of Redwater at estimated cost of 415MM Expected on-stream Q4 2015 Incremental 73,000 bpd of C2+ fractionation capacity Committed take-or-pay revenue streams for an…
And we are progressing construction at RFS II Major earth-work completed fall 2013 Digging and lining the storm water pond (pictured top left) Stripping and grading the site (pictured bottom left) Installation of facility…
RFS II is beginning to take shape Heater Flare Stack De-propanizer Storage De-butanizer Bullets Merox De-ethanizer System 92
We are debottlenecking our existing fractionator RFS C3+ Debottlenecking: Debottlenecking certain areas at Redwater for Need a new picture. an estimated cost of 45 million Increased average design throughput capacity is 9,000 bpd…
And our fractionation capacity is growing 300 185 mbpd 250 200 9 mbpd 150 73 100 9 8 50 65 20 Sarnia RFS I RFS C3+ RFS II RFS II C3+ RFS III Total Debottleneck Debottleneck Debottleneck Could…
We are pursuing a potential propane export terminal. UNIT TRAIN EXISTING NGL VALUE MARINE CHAIN TERMINAL VLGC (Very Large Gas Carrier) Propane export project would extend Pembina's NGL value chain participation…
To open up a shorter route to Asian markets West Coast Europe 0.08 8 MMTa Asia 35 MMTa USGC 0.15 Middle East 5 MMTa 34 MMTa 0.18 Africa 8 MMTa Latin America North America: 0.10 7 MMTa West Coast to Asia - Lowest…
Our strategy is driven by propane market diversity Global Opportunity A global market shift for propane has arisen as a result of growing North American production and robust Asian demand (propane used to heat homes and for…
And we are pursuing many other opportunities Gas Services Potential for significant condensate stabilization and natural gas processing infrastructure. 1 billion+ worth of investment required within Alberta NGL Midstream…
NGL value chain summary 1,800 4% 60% of Pembina's 1.7 1,600 15% billion 2014 capital 1,400 9% spending plan is directed 1,200 to NGL value chain related 21% 1,000 actives ( millions) 800 Focus remains on 600…
DEDICATED TO PIPELINE & FACILITY INTEGRITY Allan Charlesworth
Our priority is on safe and reliable operations Focus on maintaining safe and reliable operations Maintains public safety and protects the environment Lessens the likelihood of pipeline and facility incidents Sustains…
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