Enterprise Products Partners L.p. · NYSE:EPD
Enterprise Products Partners L.p — Wachovia Fixed Income Conference 2004
29 slides from Enterprise Products Partners L.p's conference presentation, Dec 7, 2004
Slide 1: Wachovia Fixed Income Conference
Wachovia Fixed Income Conference December 7, 2004 Michael A. Creel Executive Vice President & CFO
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements and information that are based on Enterprise’s beliefs and those of its general partner, as well as assumptions made by and information currently available to them. When used in this presentation, words such as “anticip
Slide 3: Forward Looking Statements (continued)
Forward Looking Statements (continued) Fluctuations in oil, natural gas and NGL prices and production due to weather and other natural and economic forces; The effects of the combined company’s debt level on its future financial and operating flexibility; A reduction in demand for its products by th
Slide 4: Overview of Enterprise (EPD)
Overview of Enterprise (EPD) One of the largest publicly traded energy partnerships serving producers and consumers of natural gas, natural gas liquids (NGLs) and crude oil IPO in July 1998 Ranked 336th on Fortune 500 list for 2004 Completed $6 billion merger with GulfTerra Energy Partners L.P. in S
Slide 5: Key Credit Highlights
Key Credit Highlights $11 billion of integrated assets and strong business positions across each link of the value chain 90%+ of operating margin from fee-based assets generating stable cash flows Recently completed actions to enhance stability of earnings Renegotiated natural gas processing contrac
Slide 6: Integrated Midstream Energy Services
Integrated Midstream Energy Services Fees are earned at each link of value chain
Slide 7: Overview of Operations
Overview of Operations Onshore Pipelines & Services 16,078 miles of natural gas pipelines 23 Bcf of natural gas storage NGL Pipelines & Services 13,130 miles of NGL and petrochemical pipelines 164 MMBbls of NGL salt dome storage 26 natural gas processing plants – net capacity of 7 Bcfd 10 NGL fracti
Slide 8: Strong Position Across Midstream Value Chain
Strong Position Across Midstream Value Chain Measured by volumes, except for gas gathering (measured by pipeline miles)
Slide 9: Joint Ventures with Strategic Partners
Joint Ventures with Strategic Partners Partners secure long-term supplies of feedstock Partners secure long-term demand for offtake from facilities
Slide 10: Compelling Reasons for Merger with GTM
Compelling Reasons for Merger with GTM Significantly increases diversity and scale of operations Provides balanced business mix and expansion to additional geographic areas The merger with GulfTerra creates a natural hedge to mitigate the effect of higher natural gas prices, providing greater earnin
Slide 11: Enterprise System Map
Enterprise System Map "
Slide 12: Complementary Transaction Provides a More Balanced Partnership
Complementary Transaction Provides a More Balanced Partnership Non-overlapping nature provides cash flow stability, diversification and a platform to create additional value.
Slide 13: Projects Update
Projects Update ©All rights reserved. Enterprise Products Partners LP.
Slide 14: Cameron Highway
Cameron Highway $500 MM project: 50/50 partner with Valero Largest offshore oil pipeline system 380 miles 3 platforms 650,000 BOPD Anchor fields and area reserves more than 1+ billion barrels Pipeline mechanically complete; Ship Shoal 332B platform installed Expecting first production from: Holstein
Slide 15: Independence Hub and Trail (Atwater Valley)
Independence Hub and Trail (Atwater Valley) On November 10, 2004, EPD announced its Independence Hub and Independence Trail projects Independence Hub is a floating platform to be located in Mississippi Canyon block 920 to service deepwater natural gas production in the eastern Gulf of Mexico Indepen
Slide 16: Independence Project Rationale
Independence Project Rationale Favorable economies of scale 15 of 18 wells planned for anchor discoveries have been drilled Remote location with 9 stranded fields owned by various producers No single field is individually large enough to support necessary infrastructure On a combined basis, these fi
Slide 17: Independence Trail
Independence Trail In relation to our Viosca Knoll System
Slide 18: Independence Hub
Independence Hub EPD will design, construct, install and own a semi-submersible production platform Located on Mississippi Canyon block 920; chosen for favorable seafloor conditions and proximity to anchor fields Capable of processing 850 MMcf/d of natural gas Designed to process production from six
Slide 19: Capital Expenditure Profile
Capital Expenditure Profile
Slide 20: Financial Overview
Financial Overview ©All rights reserved. Enterprise Products Partners LP.
Slide 21: Financial Objectives
Financial Objectives Maintain a strong balance sheet that supports investment grade debt ratings Increase the amount of gross operating margin earned from fee-based businesses Prudently invest to expand the partnership through organic growth, acquisitions and joint ventures with strategic partners M
Slide 22: GP/Management Support of EPD's Financial Profile
GP/Management Support of EPD’s Financial Profile GP eliminated 50% incentive distribution rights for no consideration Cash retained in EPD from lower distributions to GP can be used to reduce debt and capital investment Reduced payout to GP enhances value of EPD’s equity currency GP and Management p
Slide 23: Development of MLP Equity as an Asset Class
Development of MLP Equity as an Asset Class Investors seeking total return (income + growth) Equity issuance activity has increased each year Larger capitalization and liquidity of MLPs Proliferation of both private and publicly traded closed-end funds Tortoise & Kayne Anderson MLP funds with $1.2 b
Slide 24: 65% of Merger Financed with Equity
65% of Merger Financed with Equity
Slide 25: Corporate Structure – Post Merger
Corporate Structure – Post Merger
Slide 26: Pro Forma Capitalization (Unaudited)
Pro Forma Capitalization (Unaudited)
Slide 27: NGL Business Environment Improving with Economic Growth
NGL Business Environment Improving with Economic Growth Source: Pace Hodson Report
Slide 28: Overview of Results (Non-GAAP reconciliation of Gross Margin & EBITDA)
Overview of Results (Non-GAAP reconciliation of Gross Margin & EBITDA) (Unaudited)
Slide 29: Key Credit Highlights
Key Credit Highlights $11 billion of integrated assets and strong business positions across each link of the value chain 90%+ of operating margin from fee-based assets generating stable cash flows Recently completed actions to enhance stability of earnings Renegotiated natural gas processing contrac
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