Kinetik Holdings Inc. · NYSE:KNTK
Kinetik — Altus Midstream Company — Q3 2019 Earnings Presentation
18 slides from Kinetik's earnings presentation, Oct 30, 2019
Slide 1: Altus Midstream Company
Altus Midstream Company November 2019
Slide 2: Disclaimer
Disclaimer FORWARD LOOKING STATEMENTS The information in this presentation and the oral statements made in connection therewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities E
Slide 3: Altus Midstream Overview
Altus Midstream Overview 3
Slide 4: Altus Midstream Summary Overview
Altus Midstream Summary Overview Commentary Simplified Structure ► Altus Midstream is a pure-play, Permian to Gulf Coast Public Investors Apache Corporation midstream C-corp ▪ C-corp governance / no ~21%(1) ~79%(1) IDRs ► Interests in premier JV pipelines provide diversity of Altus Midstream Company
Slide 5: Gathering & Processing Overview
Gathering & Processing Overview Asset Map Asset Highlights ► Rich Gas Processing: ▪ 400 MMcf/d of capacity from two cryo trains online and in-service ▪ Cryos performing well, consistently able to run above nameplate capacity with 99%+ ethane recovery ▪ Additional 200 MMcf/d of cryo capacity expected
Slide 6: State of the Art Cryogenic Processing – SRX Technology
State of the Art Cryogenic Processing – SRX Technology ► The cryogenic facilities utilize SRX technology to capitalize on better recoveries in ethane rejection mode ► Drives improved netbacks on third-party volumes ► Standardized units allow for efficient and simpler modular expansion at centralized
Slide 7: Joint Venture Pipelines Overview
Joint Venture Pipelines Overview Pipeline Map Commentary ► Altus owns or has the option to participate in five joint venture pipeline projects ▪ 16% of KMI’s GCX (Exercised) Nat Gas ▪ 27% of KMI’s Permian Highway (Exercised) ▪ 33% of EPD’s Shin Oak (Exercised) NGLs Katy ▪ 50% of Salt Creek NGL (Opti
Slide 8: Joint Venture Pipelines Detail
Joint Venture Pipelines Detail ► All equity options except regional Salt Creek NGL Line have been exercised ▪ Closed Shin Oak JV on 7/31/19 ▪ Continue to evaluate Salt Creek option until January 2020 exercise deadline Gulf Coast Permian Salt Creek EPIC Crude Shin Oak Express Highway NGL Line Product
Slide 9: JV Pipeline Recent Developments
JV Pipeline Recent Developments Gulf Coast ► Full service started September 25, 2019 with project cost estimated at ~$1.75 billion Express Pipeline (Exercised) ► Capacity of 2.0 Bcf/d is fully subscribed under long-term, binding agreements ► Expected in-service early 2021 with project cost estimated
Slide 10: Financial Overview
Financial Overview 10
Slide 11: Financial Overview
Financial Overview ► Financing is secured for planned growth projects, underpinned by $825 million of incremental capital availability from preferred equity and amended revolver ▪ No need to access any capital markets to finance growth plans ▪ Ample liquidity to fund expected future capital requirem
Slide 12: Updated Guidance
Updated Guidance ► Reiterate 2019 guidance for Adjusted EBITDA of $70-85 million and growth capital investments of $1,575-1,625 million ▪ Gathered volumes expected to be 475-500 MMcf/d (~65% rich gas) for 2019 ► Currently expect 2020 Adjusted EBITDA of $200-250 million and growth capital investments
Slide 13: Updated Guidance, Continued
Updated Guidance, Continued Adjusted EBITDA(1) Distributable Cash Flow(1) Growth Capital Investments(1) ($ in millions) ($ in millions) ($ in millions) % Attributable to JV Pipelines % Attributable to JV Pipelines 30-40% 60-70% 75-85% 75-85% 90-95% 25-35% $350 $250 $1,750 $275 - $325 $1,575 - $1,625
Slide 14: Strong Financial Position
Strong Financial Position ►The preferred equity raise and amended revolver provide access to attractive sources of capital ▪ Revolver excludes preferred equity and proportional share of debt from unconsolidated affiliates for covenant leverage calculations ▪ Currently expect covenant leverage to be
Slide 15: Appendix
Appendix 15
Slide 16: Midstream Agreements with Apache
Midstream Agreements with Apache Commercial Agreements with Apache Area of Dedication ► The area of dedication encompasses a total of ~540,000 gross acres (as denoted by the red outline) ▪ Includes existing Apache acreage and future acreage acquired by Apache(1) ► Midstream services dedicated to Alt
Slide 17: Preferred Equity Financing & Revolver Amendment
Preferred Equity Financing & Revolver Amendment Preferred Equity Altus Midstream LP has issued $625 million of preferred equity ▪ Funded and closed on June 12 Cash distribution rate of 7% per annum, payable quarterly ▪ Flexibility to pay distributions in-kind for the first 6 quarters Redeemabl
Slide 18: Glossary of Terms
Glossary of Terms ► Adjusted EBITDA is defined as net income (loss) including noncontrolling interest before financing costs (net of capitalized interest), net interest expense, income taxes, depreciation, and accretion and adjusting for such items, as applicable, from income from equity method inte
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