Par Pacific Holdings, Inc. Common Stock · NYSE:PARR
Par Pacific Holdings, Inc. Common Stock — Par Petroleum — Investor Presentation (July 2015)
35 slides from Par Pacific Holdings, Inc. Common Stock's investor presentation, Jul 7, 2015
Slide 1: July 2015
July 2015
Slide 2: Forward-Looking Statements / Disclaimers
2 Forward-Looking Statements / Disclaimers The information contained in this presentation has been prepared to assist you in making your own evaluation of the company and does not purport to contain all of the information you may consider important. Any estimates or projections with respect to futur
Slide 3: Today's Presenters
3 Joseph Israel Chief Executive Officer Years Experience: 20 Previous Positions: Hunt Refining – SVP Alon USA – COO Alon USA – VP of M&A Alon Subsidiaries – Director Years Experience: 25 Previous Positions: BG Group – Finance Director Ennis Paint – CFO Shell Oil (U.S. Downstream) – Fin
Slide 4: I. Company Overview
I. Company Overview
Slide 5: Who We Are
5 Largest and Most Complex(1) Refiner in Niche Hawaii Market Crude capacity of 94,000 barrels per day 50% distillate yield configuration Flexibility to utilize a wide range of crude blends Who We Are Integrated Network of Logistics Assets 5.4 million barrels of storage capacity with 27 miles
Slide 6: Company Timeline
6 9/25/2013: Restart of Kapolei Refinery. Renamed Hawaii Independent Energy 9/1/2012: Delta Petroleum emerged from Chapter 11. Company is renamed Par Petroleum Piceance Energy joint venture initiated Company Timeline 2012 Emerging as Par 2013 Building the Foundation 2014 Transitioning to Profi
Slide 7: Achievements and Initiatives
7 2014 Achievements 2015 / 2016 Achievements & Initiatives Achievements and Initiatives Focus on safety and compliance, continuous improvement, operations reliability, and cost structure optimization Substantially Enhanced Organizational Depth and Operating Capabilities Named Joseph Israel Presi
Slide 8: Investment Highlights
8 High Quality Asset Base in Niche Market Largest and most complex(1) refinery in Hawaii, weighted to distillate production Substantial distribution platform consisting of 128 serviced locations across Hawaii Integrated pipeline and terminal network enhances operating efficiency and flexibilit
Slide 9: Experienced Management Team and Board of Directors
9 Experienced Management Team and Board of Directors Management Team Years Name Position Age Experience Background Joseph Israel President, CEO & Director 44 20 SVP at Hunt Refining; COO at Alon USA Chris Micklas CFO 47 25 Finance Director at BG Group; CFO of Ennis Paint; Finance Director at Shell W
Slide 10: II. Asset Overview
II. Asset Overview
Slide 11: Hawaii Refinery Overview
11 Refining Unit Capacity (MBPD) Crude Unit 94 Vacuum Distillation Unit 40 Hydrocracker 18 Catalytic Reformer 13 Visbreaker 11 Hydrogen Plan (MMCFD) 18 Naphtha Hydrotreater 13 Cogeneration Turbine Unit 20 MW Hawaii Refinery Overview Asset Highlights Largest and most complex refinery in Hawaii Ne
Slide 12: Logistics System Overview
12 30,000 Bbls 185,000 Bbls 138,000 Bbls 135,000 Bbls 12,000 Bbls Hawaiian Assets Map Asset Highlights Logistics System Overview Integrated system enhances flexibility and profitability Complementary, difficult to replicate asset base Multiple advantages from Single Point Mooring: Additional
Slide 13: Distribution Network Overview
13 Same Store Growth (Q1 2015 vs. Q1 2014) Distribution Network Overview Asset Highlights Extensive footprint across five islands Mid Pac acquisition significantly expands scale and operating capabilities Anticipated continued volume growth from increasing retail and distribution network Sev
Slide 14: Ongoing Refinery Optimization Opportunities
14 Ongoing Refinery Optimization Opportunities Opportunity to meaningfully increase system volumes and enhance profitability Total Sales Volume On-Island Sales Volume Throughput Volume Product demand is the primary constraint for refinery utilization Enhancing on-island sales improves margin fro
Slide 15: Piceance Energy Investment Overview
15 Operated by Laramie Energy II, which has drilled over 300 wells in the basin with a 99% success rate Significant recent operating and service cost reductions Drilling and completion costs reduced from $1.80MM (historical program) to $1.25MM (current program) Recent third-party investment
Slide 16: III. Key Market Trends
III. Key Market Trends
Slide 17: Well Positioned to Benefit from Commodity Flows
17 Well Positioned to Benefit from Commodity Flows Access to North American crude while competing with Asian refiners Located at the crossroads of changing crude flows from West to East Crude sourcing network provides ability to change crude slate based on regional differentials ________________
Slide 18: Historical Crack Spread and Differential
18 -2 0 2 4 6 8 10 $12 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 Historical Crack Spread and Differential Mid Pacific Crude Blend 4-1-2-1 Mid Pacific Crack Spread 80% Singapore, 20% San Francisco ____________________ (1) Company calculation based on a 3 year average for the 4-1-2-1 Mid Pacific Crack Spread
Slide 19: Leader in Niche Hawaiian Market
19 Leader in Niche Hawaiian Market Air Travel(2) ____________________ (1) Source: EIA as of Q1 2015, including military demand per Par estimates. (2) Source: DBEDT. 60 59 70 47 0 8 16 24 32 40 48 56 64 72 80 Other Products Distillate Other Products 50% Distillate 50% Refined Product Demand(1) Par Re
Slide 20: Substantial Growth Opportunities
20 Substantial Growth Opportunities Well positioned assets with significant opportunities to grow Refining Increase throughput to generate economies of scale Develop asphalt business to enhance scale and operating efficiency Optimize light end yield Logistics Enhance utilization from higher
Slide 21: IV. Financial Overview
IV. Financial Overview
Slide 22: Conservative Capital Structure and Liquidity
22 • Flexible Capital Structure • Conservative Access to Liquidity • Profitability Throughout Cycles • Utilize Capital Markets Opportunistically Conservative Capital Structure Target capital structure driven by market outlook and cash flow profile Minimal near-term maturities enhances flexibilit
Slide 23: Capitalization and Maturity Profile
23 $35 $60 $30 $135 $50 0 50 100 150 2014 2015 2016 2017 2018 2019 2020 2021 2022 Par Term Loan HIE Retail Term Loan Texadian Trade Credit (undrawn) Mid Pac Term Loan Mid Pac Revolver (undrawn) $100 $80 $55 $5 $55 Pro Forma Capitalization Capitalization and Maturity Profile Maturity Profile(4) _____
Slide 24: Summary Financial Results
24 Adjusted EBITDA Net Debt(2) Production Cost per Barrel(1) $22 ($9) ($19) ($29) $47 -40 -20 0 20 40 $60 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 ($ in millions) ($12) $71 $104 $61 $47 PF $101 -40 -20 0 20 40 60 80 100 $120 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 ($ in millions) ____________________ Note: Adj
Slide 25: Capital Expenditure Summary
25 Capital Expenditure Summary ($ in millions) Sustaining Capital Expenditures Growth Capital Expenditures $9 $20-25 $30-35 $10-15 2014 2015E 2016E 2017E $6 $30-31 $6-7 $2-3 2014 2015E 2016E 2017E ____________________ (1) Includes $10MM turnaround prefunding. (2) Includes $25-30MM turnaround and $5M
Slide 26: Net Operating Loss Carryforward
26 Net Operating Loss Carryforward Differentiated Asset Relative to Refining Peers Potential to Generate Substantial Cash Flow Provides a Competitive Advantage for Growth Opportunities $1.4 billion NOL generates significant value for Par Selected Benefits Illustrative Value to Par ($ in millions) 8.
Slide 27: V. Concluding Remarks
V. Concluding Remarks
Slide 28: Track Record of Execution
28 Track Record of Execution Acquired Mid Pac Petroleum Transitioned company to profitability Enhanced organizational depth and operating capabilities Entered into favorable commodity sourcing agreement Closed multiple financing transactions Increased volume of on-island sales
Slide 29: Investment Highlights
29 Identified Growth Opportunities Significant Financial Flexibility Experienced Management Team and Board Constructive Market Environment High Quality Asset Base in Niche Market Investment Highlights
Slide 30: Contact Information
30 Contact Information Par Petroleum Corporation (NYSE MKT: PARR) One Memorial Plaza 800 Gessner Road, Suite 875 Houston, TX 77024 (281) 899-4800 www.ppetrol.com Christine Thorp Director, Investor Relations (832) 916-3396
Slide 31: Appendix
Appendix
Slide 32: Mid Pac Acquisition
32 Financing Detail Asset Overview Strategic Rationale Serves 85 outlets across four islands Exclusive right to “76” fuel brand for Hawaii through 2024 Four refined product terminals Leased & operated terminals on Kauai and Kona Owned terminal leased to HIE in Hilo Owned & operated termi
Slide 33: Safety Record
33 1.30 1.58 1.16 1.15 1.32 1.31 1.39 1.61 1.44 1.27 1.12 1.11 1.30 1.10 1.10 0.92 0.92 0.00 0.50 1.00 1.50 2.00 0 1 2 3 4 5 14-Jan 14-Feb 14-Mar 14-Apr 14-May 14-Jun 14-Jul 14-Aug 14-Sep 14-Oct 14-Nov 14-Dec 15-Jan 15-Feb 15-Mar 15-Apr 15-May Recordables for the month 12-Month Rolling Average TRIR
Slide 34: Capitalization Detail
34 Facility Borrower Amount Outstanding (PF 3/31/2015) Undrawn Amount Amortization Maturity Interest Rate Par Term Loan Par $90.3 NA NA 7/11/2018 10.00% (12.00% PIK) HIE ABL HIE 0.0 $125.0 NA 9/25/2017 L + 2.25% HIE Retail Term Loan Retail 30.0 NA 10-Year 3/31/2022 L + 2.00% Texadian Trade Credit Te
Slide 35: Non-GAAP Financials
35 Non-GAAP Financials Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Net income (loss) ($14,568) ($24,700) ($39,456) $31,660 $462 Adjustments to Net income: Unrealized (loss) gain on derivatives - - - (698) 2,406 Lower of cost or market adjustment - - - 2,444 (2,179) Acquisition and integration expense 2,