Kinder Morgan, Inc. · NYSE:KMI
Kinder Morgan — Kinder Morgan Energy Partners — NESA 2006 Energy Forum
20 slides from Kinder Morgan's conference presentation, Oct 5, 2006
Slide 1: NESA 2006 Energy Forum
ENERGY PARTNERS, L.P. NESA 2006 Energy Forum October 5, 2006
Slide 2: Forward Looking Statements
ENERGY PARTNERS, L.P. Forward Looking Statements This presentation contains forward looking statements, including these, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward looking statements are not guarantees
Slide 3: MLP Overview
ENERGY PARTNERS, L.P. MLP Overview MLP unit similar to a “normal” stock but several key differences: MLP not subject to U.S. corporate income taxes Pay out all available cash Tax-deferred distribution Only certain assets qualify Exploration, marketing, mining, processing, production, refinin
Slide 4: Kinder Morgan System Asset Map
ENERGY PARTNERS, L.P. KinderSystem KMP MorganMap Assets PRODUCTS PIPELINES (KMP) PRODUCTS PIPELINES TERMINALS (KMP) 2 Pacific TRANSMIX FACILITIES (KMP) Cochin NATURAL GAS PIPELINES (KMP) 2 NATURAL GAS STORAGE Trailblazer (KMP) 3 North 2 NATURAL GAS PROCESSING 2 (KMP) Northern 2 CO2 PIPELINES (KMP) T
Slide 5: Kinder Morgan Structure
ENERGY PARTNERS, L.P. Kinder Morgan Structure Kinder Morgan Energy Partners (a) Market Equity $10.0 Debt 5.5 Enterprise Value $15.5B 2006E EBITDA $1,802mm (b) 2006E Dist. CF $1,290mm (b) Additional Cash GP Shares Distribution Incentive Distribution KMR KMP (LLC) (Partnership) 61 million i-units (a)
Slide 6: The Kinder Morgan Strategy
ENERGY PARTNERS, L.P. The Kinder Morgan Strategy Same Strategy Since Inception Focus on stable, fee-based assets which are core to the energy infrastructure of growing markets Increase utilization of assets while controlling costs Classic fixed cost businesses with little variable costs Improve
Slide 7: Solid Asset Base Generates Stable Fee Income
ENERGY PARTNERS, L.P. Solid Asset Base Generates Stable Fee Income CO2 Products Pipelines 2006 DCF (a) 30% CO2 transport and sales Refinery hub to population 70% oil production related center strategy Expected production hedged (b): 68% Pipelines Products 2007=96% CO2 27% Associated Terminals (c) Pi
Slide 8: Consistent Track Record
ENERGY PARTNERS, L.P. Consistent Track Record Total Distributions (GP + LP) ($mm) KMP Distribution Per Unit (c) $1,400 $1,281 $4.00 GP (a) $1,162 $3.24-$3.36 $1,200 $3.20 8% $2.96 LP $978 $3.00 =1 $1,000 54% GR $2.72 = $827 CA $2.50 $800 AGR $701 $2.20 C $2.00 $1.90 $600 $548 $1.45 $1.13 $1.30 $400
Slide 9: Attractive Historical Returns
ENERGY PARTNERS, L.P. Attractive Historical Returns Total Returns, Dec-31-96 to Aug-31-06 (a) 1,400 1,300 KMP has returned 1136% since KMP 30% annual return 1,200 12/31/96, compared to 369% and 105% 1,100 for the MLP comparable composite 1,000 and S&P 500 index, respectively. Indexed Total Return (%
Slide 10: Vision: Where We're Going
ENERGY PARTNERS, L.P. Vision: Where We’re Going Trend KM Opportunity Growing Rockies Natural Gas Production Rockies Express Increased Supply of LNG on Gulf Coast Kinder Morgan Louisiana Pipeline Canadian Oilsands Edmonton terminal Increased Use of Heavy Crude Petcoke handling – Gulf Coast, Canada Gr
Slide 11: Growing Rocky Mountain Natural Gas Production: Rockies Express Pipeline
ENERGY PARTNERS, L.P. Growing Rocky Mountain Natural Gas Production: Rockies Express Pipeline 11
Slide 12: Increased LNG Supply on Gulf Coast
ENERGY PARTNERS, L.P. Increased LNG Supply on Gulf Coast Gulf Coast LNG Projects Under Construction ") ! ") ") Henry Katy ") )" ") ") & - ~8-11 Bcf/d of terminal & -") # * ! ! ") kj capacity under ") ExxonMobil – Golden Pass # * 2008-09 Sempra – Cameron LNG 1-2") Bcf/d, projected in-svc ! 1.5-2.65!
Slide 13: Increased LNG Supply on Gulf Coast: Kinder Morgan Louisiana Pipeline
ENERGY PARTNERS, L.P. Increased LNG Supply on Gulf Coast: Kinder Morgan Louisiana Pipeline Kirbyville Transco Delivery Point Mamou !? Tyler CGT Delivery Point TETCO Delivery Point !? Port Barre Beauregard Evangeline Opelousas Allen !? Provides key ANR Delivery Point Eunice St. Landry Kinder ANR Deli
Slide 14: Growing Midcontinent Production: Midcontinent Express Pipeline
ENERGY PARTNERS, L.P. Growing Midcontinent Production: Midcontinent Express Pipeline 812 801 Oklahoma Pine Bluff ENOGEX 306 U + Sherman CROSSTEX NGPL U + Arkansas Texarkana Denton CROSSTEX 802 305 155 U + GULF SOUTH TGP Fort Worth / Dallas Texas Perryville NGPL ANR Fort Worth Proposed Dallas Mid-con
Slide 15: Identified Future Growth Opportunities
ENERGY PARTNERS, L.P. Identified Future Growth Opportunities Nearly $5 billion in identified growth opportunities over next 5 years Estimated Total Project Expected Entity Project Cost ($B) Completion KMP Louisiana Pipeline (LNG) $0.5 2009 KMP Rockies Express 2.2 (a) 2007-2009 KMP CO2 1.1 2007-2010
Slide 16: Over $10 Billion in Capital Invested at KMP
ENERGY PARTNERS, L.P. Over $10 Billion in Capital Invested at KMP ($ billions) Total Invested by Type $8.0 Total Invested by Year $6.0 $2.0 $1.9 Expansion $4.0 Acquisition $7.6 $1.6 $1.6 $2.0 $1.3 $1.3 $3.1 $1.2 $1.1 $1.1 $0.0 $1.0 $0.9 Acquisitions Expansions $0.8 Total Invested by Segment $0.5 $4.
Slide 17: Attractive Return on Capital
ENERGY PARTNERS, L.P. Attractive Return on Capital Return on Investment (a): 2000 2001 2002 2003 2004 2005 Products Pipelines 11.9% 11.8% 12.8% 12.9% 12.4% 11.3% Natural Gas Pipelines 13.3 15.5 12.9 13.5 14.0 15.5 CO2 27.5 24.6 22.0 21.9 23.8 25.7 Terminals 19.1 18.2 17.7 18.4 17.8 16.9 KMP Return o
Slide 18: KMP is Conservatively Capitalized
ENERGY PARTNERS, L.P. KMP is Conservatively Capitalized ($ millions) Credit Summary KMP L-T Debt Rating Baa1/BBB+ Net Debt / Total Capital (a,b,c) 52.7% 2006 Budget Estimates: Debt / EBITDA 3.1x EBITDA / Interest 5.6x CP Capacity (c) Long-term Debt Maturities (c) KMP KMP Total Bank Credit $1,850 (d)
Slide 19: Summary
ENERGY PARTNERS, L.P. Summary Stable Cash Flow Own assets core to energy infrastructure Internal Growth Opportunities Critical Mass Well-located assets/favorable demographics Fixed Cost Business Drop growth to bottom line Unique Structure Tax Efficient Incentive Fee Management Philosophy
Slide 20: Kinder Morgan
KINDER’ MORGAN
Kinder Morgan Energy Partners — NESA 2006 Energy Forum on 6ix