Kinder Morgan, Inc. · NYSE:KMI
Kinder Morgan — 2009 KMP Analyst Conference
32 slides from Kinder Morgan's conference presentation, Jan 29, 2009
Slide 1: Natural Gas Pipelines
ENERGY PARTNERS, L.P. Natural Gas Pipelines Steve Kean President Natural Gas Pipeline Group
Slide 2: Overview
ENERGY PARTNERS, L.P. Overview Value Proposition — Strong asset base with secure cash flows supported by long term contracts and solid market fundamentals — Limited exposure to commodity prices and processing margins Keys to success in 2009 — Delivering the large projects (REX, MEP and KMLA) consist
Slide 3: Natural Gas Pipelines and Facilities
ENERGY PARTNERS, L.P. Natural Gas Pipelines and Facilities NATURAL GAS PIPELINES NATURAL GAS STORAGE NATURAL GAS PROCESSING ROCKIES EXPRESS PIPELINE IN-SERVICE ROCKIES EXPRESS PIPELINE MIDCONTINENT EXPRESS PIPELINE KM LOUISIANA PIPELINE FAYETTEVILLE EXPRESS PIPELINE (KMP) (2,3,8) INDICATES NUMBER OF
Slide 4: Contracted Capacity and Term
ENERGY PARTNERS, L.P. Contracted Capacity and Term Avg. Term Capacity Remaining Texas Intrastates Transport 3.3 bcf/d 7 yr, 4 mo Sales 2.6 bcf/d 2 yr, 3 mo Purchases 3.0 bcf/d 1 yr, 9 mo Storage 138* bcf 3 yr, 5 mo KMIGT Storage 10 bcf 4 yr, 8 mo Transport 0.9 bcf/d 4 yr, 8 mo TransColorado Transpor
Slide 5: Financial Targets 2009
ENERGY PARTNERS, L.P. Financial Targets 2009 (thousands) '08 - '09 2005 2006 2007 2008 2009 Change EBDDA 451,579 501,103 548,383 738,860 868,347 129,487 Sustaining Capex (25,244) (27,431) (29,927) (29,853) (34,868) (5,015) DCF 426,335 473,672 518,456 709,007 833,479 124,472 Incremental DCF forecas
Slide 6: Asset Summaries
ENERGY PARTNERS, L.P. Asset Summaries 6
Slide 7: Texas Intrastate Pipelines
ENERGY PARTNERS, L.P. Texas Intrastate Pipelines 6,000 miles of pipeline over 5 Bcf/d capacity 138 Bcf on-system storage 685 MMcf/d processing Perryville capacity Carthage 180 MMcf/d CO2 treating capacity Combination of fee-for-service, Waha and purchase/sale activity. Texas Railroad Commission Katy
Slide 8: Texas Intrastate Pipelines
ENERGY PARTNERS, L.P. Texas Intrastate Pipelines Key Attributes Well positioned assets — Built to serve Houston/Beaumont area - largest natural gas market in the world — Connected to essentially all major gas consumers in the area — Gas supply available from major basins across Texas — Connected to
Slide 9: Texas Intrastate Pipelines
ENERGY PARTNERS, L.P. Texas Intrastate Pipelines Continued Growth Expansion of Existing Assets: Recently Completed: — Goodrich Pipeline, 64 miles of 24” 24” out of East Texas, in service October 2008 — Markham Storage, 5th cavern, 7.5 Bcf working capacity, gas injection commenced in May May 2008 a
Slide 10: Texas Intrastate Pipelines
ENERGY PARTNERS, L.P. Texas Intrastate Pipelines Moderate Growth Growth from Existing Assets: Higher premiums for ratable / swing services, end-user gas sales, and transport — Value of swing / storage services continues to increase — Rollovers of sales contracts at higher margins providing year on
Slide 11: Keys to Success in 2009
ENERGY PARTNERS, L.P. Keys to Success in 2009 Execute on all sales and purchase margin enhancement initiatives Maintain field supply volumes at current levels Favorable optimization spreads across the pipeline (Waha, TxOk vs HSC) Execute and fill projects Favorable storage spreads Contin
Slide 12: Kinder Morgan Interstate Gas Transmission (KMIGT)
ENERGY PARTNERS, L.P. Kinder Morgan Interstate Gas Transmission (KMIGT) KMIGT 4,500 miles of various diameter pipelines Markets: LDCs, Industrials, & Ag. In NE, KS, & MO Marketers transporting to mid-continent pipelines End Users including Ethanol Plants Growth Colorado Lateral Stora
Slide 13: KMIGT
Growth Market Valuable Capacity KMIGT Opportunities Fully contracted Historical 4/ 1 -$0.20 $0.30 $0.80 $1.30 $1.80 $2.30 $2.80 $3.30 $3.80 $4.30 $4.80 $5.30 5/ /20 1/ 0 8 6/ 20 1 0 7/ /20 8 1/ 0 8 8/ 20 1 0 9/ /20 8 10 1/2 08 / 0 11 1/2 08 /1 0 0 1 2 /2 8 /1 0 0 1 / /2 0 0 8 1 8 2/ /200 1 3/
Slide 14: KMIGT
ENERGY PARTNERS, L.P. KMIGT Growth Projects… Completed Colorado Lateral to Greeley Colorado. In-service November, 2008 Demand charges being invoiced pursuant to a long-term binding contract with ATMOS Pursuing transportation opportunities to utilize additional system capacity Completed Sys
Slide 15: TransColorado Gas Transmission
ENERGY PARTNERS, L.P. TransColorado Gas Transmission TransColorado 301 miles of 22” & 24” pipeline Originates at Greasewood CO Terminates at Blanco, NM Bidirectional Flow Capacity North - 650 MDth/d Capacity South Phase I - 150 MDth/d Phase II - 425 MDth/d FERC Regulated 15
Slide 16: TransColorado
Market Fully contracted Valuable Capacity Growth Opportunities TransColorado Historical 4/ 1 -$0.20 $0.30 $0.80 $1.30 $1.80 $2.30 $2.80 $3.30 $3.80 $4.30 $4.80 $5.30 5 / /2 0 1 0 6 / /2 0 8 1 0 7 / /2 0 8 1 0 8 / /2 0 8 1/ 0 8 9/ 20 1 0 1/2 0 8 / 0 1 1 1/2 0 8 / 0 1 2 1/2 0 8 /1 0 0 1 / /2 0 8 1 0 2
Slide 17: TransColorado
ENERGY PARTNERS, L.P. TransColorado Growth Projects… Compression expansion for southbound capacity from Meeker to Blanco Capacity 47,000 Dth/d April - September 55,000 Dth/d October - March 10,190 Hp installed in existing compressor stations Capital investment well supported by 2009 – 2013
Slide 18: Trailblazer Pipeline Company
ENERGY PARTNERS, L.P. Trailblazer Pipeline Company Trailblazer 436 Miles of Pipe Wyoming 3 Compressor Locations with 58,000 HP Nebraska Max Throughput = 0.878 Huntsman CheyenneStorage Bcf/d 602 Lincoln 601 Low cost pipeline out of Cheyenne Hub 603 region 106 Long term contracts Denver Colo
Slide 19: Major Projects Update
ENERGY PARTNERS, L.P. Major Projects Update In service in 09 for REX East, MEP, KM Louisiana Finding value added opportunities - Capacity is valuable - Putting higher recourse rates into effect - Finding additional capacity and services Still subject to price and schedule change -- but within narrow
Slide 20: Project Cost Environment
ENERGY PARTNERS, L.P. Project Cost Environment Outlook for future projects Product/Service Pricing Indications Lead Time/Availability Large Diameter Pipe Down about 30% since last Should see improvement later in summer ≈ 1500/ton 2009 Compression Stable Some slots opening; expect continued improveme
Slide 21: Rockies Express Pipeline (REX)
ENERGY PARTNERS, L.P. Rockies Express Pipeline (REX) OVER- ROCKIES EXPRESS PIPELINE THRUST CAPACITY LEASE REX-WEST (IN-SERVICE) REX-EAST 1,500 MDth/d – Interim: 01/08 / Full: 05/08 1,600 MDth/d – Interim: 04/09 / Full: 06/09 Full In-Service 1,800,000 Dth/d – Nov 2009 Opal Kanda Wamsutter Cheyenne Le
Slide 22: REX
ENERGY PARTNERS, L.P. REX Project Overview REX West Commenced service in January, 2008 Commenced full in-service May 20, 2008 - 1.5 Bcf/d of capacity REX East – Currently under construction, to be phased into service: April ’09: “Interim Service” -- Triggers shipper demand charge payments
Slide 23: REX
ENERGY PARTNERS, L.P. REX Remaining Challenges Construction Risks Winter construction HDD’s Increasingly difficult terrain moving eastward Time and material structure (financial risk) Regulatory Issues Final Major Permit: Water Quality Permit from the Ohio EPA FERC Notices to Proceed Eas
Slide 24: REX
ENERGY PARTNERS, L.P. REX Future Opportunities… Significant additional growth potential via other opportunities… 200,000 Dth/d Meeker to Cheyenne Expansion Fully Subscribed Anticipated In-service April 2010 Storage and Park and Loan Service Development and sale of storage off the pipeline
Slide 25: Midcontinent Express Pipeline (MEP)
ENERGY PARTNERS, L.P. Midcontinent Express Pipeline (MEP) Waynoka Plant Enogex West Enogex East Initial Design Project Facilities Summary Diameter Miles Zone Capacity From - To 30” 40 1 865,000 Enogex to 802 42” 266 1 1,432,500 802 to End of Zone 1 36” 201 2 1,000,000 Begin Zone 2 to Transco T
Slide 26: MEP
ENERGY PARTNERS, L.P. MEP Construction Progress Mainline Construction To Delhi (Phase I) Construction has begun on all 7 spreads, compressors and meter stations Projected interim service is forecasted to begin on April 1, 2009 To Transco 85 (Phase II) March 1 construction start Projected
Slide 27: MEP
ENERGY PARTNERS, L.P. MEP Challenges and Opportunities Challenges Keeping contractors on all Spreads and at all compressor stations on schedule Weather – normal winter rains are reducing work days at compressor stations and pipeline Spreads Material Deliveries Opportunities Higher recourse r
Slide 28: Kinder Morgan Louisiana Pipeline
ENERGY PARTNERS, L.P. Kinder Morgan Louisiana Pipeline 28
Slide 29: Kinder Morgan Louisiana Pipeline
ENERGY PARTNERS, L.P. Kinder Morgan Louisiana Pipeline Opportunities Working with existing shippers on sharing benefits of value-added services with limited capital investment. (flexible service, IT, market to shippers with nearby storage) Multiple interconnections – with additional facilities may b
Slide 30: Fayetteville Express Pipeline (FEP)
ENERGY PARTNERS, L.P. Fayetteville Express Pipeline (FEP) Pipeline Length: 185 miles Pipe Diameter: 42” Initial Capacity: 2.0 Bcf/d 30
Slide 31: FEP
ENERGY PARTNERS, L.P. FEP Commercial Status Total of 1.85 bcf/day capacity sold. Have 0.15 bcf/day available for sale. Producers are finalizing drilling plans. Expect to sell the remaining capacity prior to in-service. Shippers Precedent Agreements Executed: Southwestern: 1,200,000 Dth/d, 10
Slide 32: Growth Opportunities
ENERGY PARTNERS, L.P. Growth Opportunities Extensions off of expanded footprint - REX - Northeast and/or Chicago markets - MEP - take away needs from Transco Sta. 85 - Storage - Existing network Future shale opportunities - Mainline transmission - Gathering Acquisitions 32