Dt Midstream, Inc. · NYSE:DTM
Dt Midstream — J.P. Morgan Midwest Utilities & Midstream 1x1 Forum (March 2024)
28 slides from Dt Midstream's conference presentation, Mar 28, 2024
Slide 1: J.P. Morgan Midwest Utilities & Midstream 1x1 Forum
J.P. Morgan Midwest Utilities & Midstream 1x1 Forum March 28, 2024 Ammons compressor station – Appalachia Gathering System phase 2 expansion
Slide 2: Safe Harbor Statement
New slide Safe Harbor Statement This presentation contains statements which, to the extent they are not statements of historical or present fact, constitute “forward-looking statements” under the securities laws. These forward-looking statements are intended to provide management’s current expectati
Slide 3: DT Midstream Investment Thesis
DT Midstream Investment Thesis Pure play natural gas Premium shareholder Strong organic growth Balance sheet strength midstream portfolio returns ~65% pipeline segment1; Distinctive Adjusted Sizeable project backlog Line-of-sight to investment highest in sector2 EBITDA4 growth of 10%5 grade credit r
Slide 4: Pure Play Natural Gas Midstream Portfolio
Pure Play Natural Gas Midstream Portfolio Integrated pipeline platform in leading gas basins serving growing markets Pipelines connect world-class basins to high-quality markets • ~900 miles of FERC-regulated interstate pipelines that have interconnections with multiple interstate pipelines and util
Slide 5: Delivering Distinctive and Predictable Growth
Delivering Distinctive and Predictable Growth Track record of strong growth Historical Adjusted EBITDA1 Relative Growth (Millions) 2020-2023 Adjusted EBITDA CAGR2 9% 9% CAGR $924 $841 $778 $720 4% 2020 2021 2022 2023 Peer average3 ✓ Well positioned assets and take-or-pay contract structures consiste
Slide 6: Diversified Asset Base Anchored by Strong Pipeline Segment
Diversified Asset Base Anchored by Strong Pipeline Segment Highest natural gas pipeline asset contribution in sector1 Business mix (% of total 2023 Adjusted EBITDA2) Highly contracted asset portfolio supports Millennium NEXUS 11% Pipeline stable cash flows 63% 13% Ohio Utica LEAP • Average portfolio
Slide 7: High Quality Cash Flows and Customers
High Quality Cash Flows and Customers Cash flows are underpinned by take-or-pay contracts and high credit quality customers Total revenue contribution Customer credit (% of 2023 contribution1) (% of 2023 contribution) ~90% ~85% Demand / MVC or Investment grade and flowing gas2 “Rising star3” Non-inv
Slide 8: Positioned to Serve In-flight LNG Export Demand
Positioned to Serve In-flight LNG Export Demand LNG growth of ~7 Bcf/d within LEAP’s corridor is not subject to DOE permit approvals LNG demand that LEAP can serve Forecasted US LNG export capacity growth1 DOE DOE (bcf/d) LNG project Bcf/d LNG project Bcf/d approval2 approval2 Operational Pre-FID Sa
Slide 9: New Haynesville Takeaway Capacity is Needed to Meet LNG Demand
New Haynesville Takeaway Capacity is Needed to Meet LNG Demand LEAP offers lower-risk, capital efficient expansion opportunity, proving timely access to LNG demand Forecasted Louisiana Gulf Coast area LNG capacity growth1 vs announced Haynesville takeaway expansions2 (Cumulative growth from 2023, bc
Slide 10: Strong Long-term Production Outlook in Both Basins
Strong Long-term Production Outlook in Both Basins Haynesville and Appalachia production are expected to experience significant growth over the next decade Historical production Production forecast (bcf/d) Haynesville Appalachia (bcf/d) Haynesville Appalachia 60 +18 bcf/d 67 50 40 27 49 30 15 20 10
Slide 11: Continuing Our Track Record of Distinctive Growth
Continuing Our Track Record of Distinctive Growth Targeting long-term Adjusted EBITDA growth of 5-7% Adjusted EBITDA1 (millions) 5-7% long-term +6% growth rate $980 - $1,040 Differentiated growth drivers $930 - $980 $1.3 billion organic growth project backlog Tangible energy transition projects
Slide 12: Committed Growth Investment Summary
Committed Growth Investment Summary Continue to advance short-cycle growth investments Expected Project in-service dates Haynesville LEAP pipeline expansion – phase 2 In-service Pipeline Haynesville LEAP Gillis Access interconnect Q2 2024 Haynesville LEAP pipeline expansion – phase 3 Q3 2024 Appalac
Slide 13: Sizeable Organic Project Backlog
Sizeable Organic Project Backlog Balanced opportunity set across all business segments Pipeline Gathering Project Contribution Status Project Contribution Status LEAP phase 1 expansion Aug. 2023 In-service Blue Union gathering / treating expansion Dec. 2023 In-service LEAP phase 2 expansion Dec. 202
Slide 14: Increasing LEAP Expansion Potential
Increasing LEAP Expansion Potential Market fundamentals driving greater demand for Haynesville to Gulf Coast pipeline capacity DTM assets LNG facilities DTM treating plants Operational Phase 3 LEAP expansion on track and on budget to Electric compression Under development increase capacity from 1.7
Slide 15: Louisiana Carbon Capture and Sequestration
Louisiana Carbon Capture and Sequestration Disciplined approach to CCS project Project timeline Methodical project development approach Capital deployment Q4 ✓ Class VI well permit filing Disciplined storage site selection and stakeholder engagement 2022 ✓ Conducted 3D seismic survey ✓ Proximity to
Slide 16: Louisiana Carbon Capture and Sequestration
Louisiana Carbon Capture and Sequestration Disciplined approach to CCS project Illustrative Carbon Capture and Sequestration process Phase 1 Phase 2 Natural gas Equipment captures CO2 treating facility from treating plants Capture equipment, Capture equipment, Scope CO2 pipeline, CO2 pipeline, CO2 c
Slide 17: Ohio Utica System Initial Trunkline Construction Completed
Ohio Utica System Initial Trunkline Construction Completed Overall construction progressing ahead of schedule Emerging associated gas resource development area • Initial gathering backbone buildout of >200 MMcf/d capacity – Expected DTM investment1 of ~$100 million for 2023-2024 Direct access – ~5x
Slide 18: DTM Assets are Strategically Connected to Growing Demand
DTM Assets are Strategically Connected to Growing Demand LEAP offers 3.5 Bcf/d of direct connectivity to LNG markets Adding new connectivity to Haynesville system to support existing DOE approved LNG projects • Current interconnect capacity of 2.5 Bcf/d to operating LNG terminals • Building new 1 Bc
Slide 19: Disciplined Capital Investment
Disciplined Capital Investment Self-funding highly accretive organic growth projects Growth capex (millions) Committed Pre-FID 2023 original guidance Flexible, short-cycle, capital investments • Total committed capex of ~$300 million over 2024/2025 • Advancing numerous accretive organic projects tow
Slide 20: Strong balance sheet, free of near-term debt maturities
Strong balance sheet, free of near-term debt maturities Expecting investment grade credit rating in 2024 Debt maturity profile ($ billions) Long-term debt Undrawn revolver capacity Drawn revolver balance $1.1 ~$0.9 billion liquidity $1.0 $1.0 3.6x / 4.1x on-balance sheet / proportional leverage1 $0.
Slide 21: Executing a Leading ESG Program
Executing a Leading ESG Program Second highest MSCI rating among midstream peers Environmental • Continuing to advance CCS opportunity in Louisiana • Advancing hydrogen development opportunities with strategic partnership • Transitioning to net zero GHG emissions by 2050, including a 30% reduction b
Slide 22: Committed to Strong Governance Practices
Committed to Strong Governance Practices Best-in-class governance practices DT Midstream Board Composition • Structured as C-Corp with separate CEO and Chairman • Long-term incentive plans tied to total shareholder return targets Robert Skaggs, Jr. Stephen Baker • Board committee focused on ESG init
Slide 23: Appendix
Appendix 23
Slide 24: 2024/2025 Guidance Summary
2024/2025 Guidance Summary (millions, except EPS) Guidance 2024 Adjusted EBITDA1 $930 - $980 2024 Operating Earnings2 $335 - $375 2024 Operating EPS2 $3.43 - $3.83 2024 Distributable Cash Flow3 $640 - $700 2024 Capital Expenditures4 $330 - $415 Growth Capital $300 - $375 Maintenance Capital $30 - $4
Slide 25: Joint Venture Debt Details
Joint Venture Debt Details Annual debt paydown at Millennium and Vector DTM proportionate share End of year debt balances Interest expense Asset Weighted average (DTM ownership %) 2023 2024 2025 2023 2024 2025 interest rate1 Maturity NEXUS Pipeline Bullets, 2028 $371 $371 $371 $14 $21 $21 5.68% (50%
Slide 26: Non-GAAP Definitions
New slide Non-GAAP Definitions Adjusted EBITDA and Distributable Cash Flow (DCF) are non-GAAP measures Adjusted EBITDA is defined as GAAP net income attributable to DT Midstream before expenses for interest, taxes, depreciation and amortization, and loss from financing activities, further adjusted t
Slide 27: Non-GAAP Definitions
New slide Non-GAAP Definitions Operating Earnings and Operating Earnings per share are non-GAAP measures Use of Operating Earnings Information – Operating Earnings exclude non-recurring items, certain mark-to-market adjustments and discontinued operations. DT Midstream management believes that Opera
Slide 28: Non-GAAP Reconciliations
New slide Non-GAAP Reconciliations Reconciliation of net income attributable to DT Midstream to Adjusted EBITDA (millions) 2023 1. Includes share of our equity method investees’ earnings before interest taxes, depreciation and amortization, which we refer to as “EBITDA.” A reconciliation of Net inco
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