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CO2 – Kinder Morgan, Inc.

Kinder Morgan, Inc. · Jan 28, 2015 · 36 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. CO2 – Kinder Morgan, Inc. – slide 1
    CO2 Jesse Arenivas President CO2 Group
  2. CO2 – Kinder Morgan, Inc. – slide 2
    Kinder Morgan CO2 Asset Map 2
  3. CO2 – Kinder Morgan, Inc. – slide 3
    Historical Growth 2012 2013 2014 2015 Gross volumes Actual Actual Actual Budget Oil Production (Bbl/d) SACROC 28,968 30,655 33,155 33,005 YATES 20,839 20,360 19,531 19,216 KATZ 1,722 2,691 3,641 5,025 GOLDSMITH (a) N/A 1,278…
  4. CO2 – Kinder Morgan, Inc. – slide 4
    2015 DCF by Asset Group(a) 2015 DCF = 1,327 MM GLSAU Katz Tall Cotton 4% 1% 1% S&T 33% Sacroc Complex 48% Yates 13% __________________________ (a) Segments shown without elimination. 5
  5. CO2 – Kinder Morgan, Inc. – slide 5
    2015 Expansion Capital Budget - 1,237MM REVISED - 978MM 2015 Budget 2015 Budget REVISED 1,237 Expansion Capital 978MM Expansion Capital ROZ Katz Katz 4% ROZ 5% GLSAU 4% 5% 7% Yates GLSAU 3% 9% Yates 3% S&T 47% SACROC…
  6. CO2 – Kinder Morgan, Inc. – slide 6
    2015 Expansion Program Summary REVISED Capex Program 978MM(a) S&T 454MM Capex (includes 36MM Cap OH & Cap CO2) 454MM 47% Continue Cow Canyon Development Wink to Colorado City pipeline Hovenweep Cooling St Johns unit and Lobos…
  7. CO2 – Kinder Morgan, Inc. – slide 7
    Impact of Oil Price / Volume Variance on 2015 DCF ( in millions) 2015 Budget: 1,327MM Volume +/- 1,000 Bbl/d SACROC / Katz / GLSAU 20.0MM Yates 10.6MM CO2 Volume +/- 50 MMcf/d 8.8MM Oil Price +/- 1/Bbl WTI NGL 2.1MM CO2…
  8. CO2 – Kinder Morgan, Inc. – slide 8
    Actions Taken/Budget Upsides Projected oil production increase 1,500 Bbl/d at SACROC 30MM Targeted OPEX Savings 30MM Potential DCF Impact 60MM Targeted CAPEX Savings 113MM 9
  9. CO2 – Kinder Morgan, Inc. – slide 9
    CO2 Source & Transportation Continuing Business Opportunities Record Year for SW Colorado Production Permian Basin CO2 Deliveries MMcf/d 1800 Other 1600 1400 1200 1000 Sheep Mtn. 800 Bravo Dome 600 400 McElmo Dome & Doe…
  10. CO2 – Kinder Morgan, Inc. – slide 10
    CO2 Entitlement Volumes Produced and Sold to our Customers CO2 KM-share MMcf/d Significant growth since 2005: CAGR: volumes +5.57% 800 No decline in CO2 demand in 2009 2015 vs 2014: volumes +9.05% 700 600 As a reminder: 500…
  11. CO2 – Kinder Morgan, Inc. – slide 11
    Demand Growth and Regeneration 5-year Contracted CO2 Volumes CO2 Daily Contract Quantities MMcf/d 2006 2015 1,200 1,000 Previously higher oil prices increased long-term demand for CO2 800 Weighted average contract life with 600…
  12. CO2 – Kinder Morgan, Inc. – slide 12
    Serving the Market Timely Supply Expansions Southwest Colorado CO2 Production Volumes as of: Actual Actual Actual Budget 2012 2013 2014 2015 Future MMcfd MMcfd MMcfd MMcfd Potential SWC Actual Average Daily Volumes 1,212 1,218 1,282…
  13. CO2 – Kinder Morgan, Inc. – slide 13
    McElmo Dome Field Expansion Cow Canyon Development Projected Production Forecast (MMcf/d) Additional 200 MMcf/d Opportunity 1.6 1.3 TCF reserves potential 1.4 Cow Canyon Known area from past drilling 1.2 1.0 Project Costs…
  14. CO2 – Kinder Morgan, Inc. – slide 14
    St. Johns Development Project Update Develops additional 300 MMcf/d AZ Cortez CO2 Pipeline 1.3 TCF reserves potential 450 sq. mi Unit, 300 sq. mi developed NM 216-mile Lobos PL w/interconnect to Cortez 216 mi Lobos CO2 Pipeline…
  15. CO2 – Kinder Morgan, Inc. – slide 15
    Cortez Pipeline Expansion Project Expansion enables significant growth in CO2 supply to the Permian HW/CC Cow Booster Station Increases current capacity from 1.3 Canyon Bcf/d to nearly 2.0 Bcf/d Cortez Station La Plata Station…
  16. CO2 – Kinder Morgan, Inc. – slide 16
    Oil and Gas Segment Production and DCF Net Hydrocarbon Production (Mboe/d) Original oil in place (Billion Bbls) SACROC Yates Katz GLSAU Gas Processing SACROC 2.8 60.0 50.0 Yates 5.0 40.0 Katz 0.23 30.0 GLSAU 0.48 20.0 Gross…
  17. CO2 – Kinder Morgan, Inc. – slide 17
    Oil & Gas Margins and Cost Structure Oil & Gas Cash Cost Structure(a) (/Net Boe) 100 O&G cost structure has strong 90 80 correlation to energy prices 70 60 Power is tied to gas prices 50 40 High activity levels have…
  18. CO2 – Kinder Morgan, Inc. – slide 18
    Oil and Gas Segment Over past 7 years capex 0.5% above plan, oil production 0.1% below plan Capex (MM) Net Oil Production (MBbl/d) 600 45 40 500 35 400 30 25 300 20 200 15 10 100 5 - - 2008 2009 2010 2011 2012 2013…
  19. CO2 – Kinder Morgan, Inc. – slide 19
    SACROC Production & Operations Highlights Oil Production 2003-2015 (MBbl/d) 2014 Review 40 Actual Budget Oil production 7.1% above plan 35 Harvest better than expected 30 Infill results significantly better than plan 25 Platform 2…
  20. CO2 – Kinder Morgan, Inc. – slide 20
    SACROC Unit Harvest Project: 2,200 Bbl/d of incremental oil & 45 MMcf of additional recycled CO2 to inject Harvest Production 2012 and 2013 projects 3-5 2-2 3-6 2-1 3-7 2-6 2-4 3-8 4-3 4-1 3-3 3-2 3-1 Pump…
  21. CO2 – Kinder Morgan, Inc. – slide 21
    SACROC Unit Bypassed Pay Project Middle Canyon re-development (CR 1 and 2) S Platform Injection began on 8/5/14 current 30 MMcf/d 78% of injection going into 2 heel patterns Production exceeding expectations Injection sleeves can…
  22. CO2 – Kinder Morgan, Inc. – slide 22
    SACROC Unit Infill Drilling Project Denser-spaced Platform Drilling Project 26 GZ PO wells currently producing 3,600 Bbl/d 3 Conventional Infill wells producing 712 Bbl/d Results indicate that 104 solid prospects exist Defers…
  23. CO2 – Kinder Morgan, Inc. – slide 23
    SACROC Unit Long Range Plan SACROC Oil Production LRP Changes from 2014 plan 40,000 104 Well Platform Infill 35,000 Program identified 30,000 Chiquita Expansion projects added 25,000 Platform 4, Platform 5 and BOPD_Actual West…
  24. CO2 – Kinder Morgan, Inc. – slide 24
    Yates Production Steady 2014 Oil Production (Bbl/d) Oil Production 1.7% below plan 25,000 Oil column is stable Continued success in targeted East Side drilling 20,000 Focus deeper completions to minimize gas 15,000 West Side…
  25. CO2 – Kinder Morgan, Inc. – slide 25
    Katz CO2 Project Production Building on Slower Trend Investment 258MM project total, 225MM through 2014 Bbl/d Continued expectation of 16% recovery and 7000 25.1 MMBbls reserves 6000 Oil Response Oil rate improved 3,605 to 3,910…
  26. CO2 – Kinder Morgan, Inc. – slide 26
    GLSAU Production 2014 Results: - Oil Production below plan - Opex over plan 2013-14 Oil Production (Bbl/d) 3,000 Operational and Reservoir challenges: 2,500 Oil Processing rate slower than expected 2,000 2014 Budget Conformance…
  27. CO2 – Kinder Morgan, Inc. – slide 27
    GLSAU Production Strategies to address the challenges: 2015 Oil Plan (Bbl/d) Improve Response 3,000 Execute wellwork for the impaired wells Oil Improve processing rates 2,500 2015 Budget Infill drill 2,000 BOPD Stimulate…
  28. CO2 – Kinder Morgan, Inc. – slide 28
    KM ROZ Phase I Project San Andres ROZ oil saturation similar to water-flooded main pay San Andres KM ROZ Phase I Production Forecast Several significant San Andres ROZ projects underway in San Andres Phase 1 88.3 MM CAPEX Nine…
  29. CO2 – Kinder Morgan, Inc. – slide 29
    KM ROZ Future Development 6 Section Development Based On 3D Seismic, Cores, Well Logs 194 Patterns 194 WAG Injectors 233 Producers Peak Oil Rate: 25,000 Bbl/d (2021) 93.5MM STBO Reserves 12% Recovery Factor 647 BCF CO2…
  30. CO2 – Kinder Morgan, Inc. – slide 30
    Oil and Gas Segment Production Forecasts Production expectations tend to grow over time Evolution of Forecasted 2015 Production(a) over Time (MBbl/d, 8/8ths) We expect production to exceed our reserve report over the long-term 60…
  31. CO2 – Kinder Morgan, Inc. – slide 31
    Oil & Gas, and Business Unit IRR 30% All-in O&G IRR (2000-2024) 22.5% 10-K + Reserve Report Required disclosures in 10-K plus Gas Processing proved reserves cash flows: 16.9% Total 25% Adding in Gas Processing…
  32. CO2 – Kinder Morgan, Inc. – slide 32
    Response to Current Oil Price Environment Focus on Costs SACROC, Yates and S&T have low cost structures GLSAU Katz Tall Cotton 1% 1% Cash lifting cost per BOE 4% SACROC 11.62 Yates 7.90 S&T Projects profitable at current prices…
  33. CO2 – Kinder Morgan, Inc. – slide 33
    2015 Projects Price Sensitivity IRR % at Variable Oil Price / BO 40 50 60 70 SACROC Infill 35% 68% 100% 100% SACROC- Bypass 35% 65% 100% 100% SACROC P4 -- 8% 11% 21% Yates HDH 23% 40% 57% 74% GLSAU 4a 3% 8% 12% 16% Tall Cotton…
  34. CO2 – Kinder Morgan, Inc. – slide 34
    2015 Projects Price Sensitivity 15% Cost Reduction IRR % at Variable Oil Price / BO 40 50 60 70 SACROC Infill 70% 82% 98% 100% SACROC- Bypass 50% 79% 98% 100% SACROC P4 -- 10% 20% 30% Yates HDH 34% 58% 76% 87% GLSAU 4a 7% 11%…
  35. CO2 – Kinder Morgan, Inc. – slide 35
    KM CO2 Current Outlook Development Plans 2015-2023 10 Year SACROC Group Forecast KM Share Cap CO2 & Continue platform development plan; production forecast is based on Net BOE (a) Capex Overhead existing recovery expectations…
  36. CO2 – Kinder Morgan, Inc. – slide 36

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