Altagas Ltd. · TSX:ALA

Altagas — Investor Presentation (January 2025)

55 slides from Altagas's investor presentation, January 2025

  1. Slide 1: Fundamentally Focused: Corporate Investor Presentation

    Fundamentally Focused Corporate Investor Presentation

  2. Slide 2: Forward-Looking Information

    Forward-Looking Information This presentation contains forward-looking information (forward-looking statements). Words such as "may", "can", "would", "could", "should", "likely", "will", "intend", "contemplate", "plan", "anticipate", "believe", "aim", "seek", "future", "commit", "propose", "contempl

  3. Slide 3: Two Core Businesses, One Strong Platform

    Two Core Businesses, One Strong Platform Gas Gathering NGL Extraction Transportation, Global Wellhead & Processing & Fractionation Storage & Rail Logistics Export Markets A leading energy infrastructure platform that Midstream GAS NGLs C3 & C4 C3 & C4 C3 & C4 invests in and operates long-life infras

  4. Slide 4: AltaGas Value Proposition

    AltaGas Value Proposition Diversified, Low-Risk Business Model with Visible Growth and Disciplined Capital Allocation Low Risk Energy Infrastructure Visible, Industry- Disciplined Capital 1 2 3 Platform Providing Stable and Leading Growth Allocation Growing Earnings / Cash Flows Robust energy fundam

  5. Slide 5: Strategic Priorities

    Strategic Priorities Focus on growing, de-risking, and strengthening the enterprise. 1 2 3 Optimize Assets For Active Continued Balance Maximum Returns De-risking Sheet Deleveraging Increase throughput, extend asset lives Increased long-term commercial contracting Move towards our 4.0x adjusted net

  6. Slide 6: AltaGas History – Repositioning the Platform Since 2019

    AltaGas History – Repositioning the Platform Since 2019 Three Pillar Infrastructure Platform WGL Acquisition – 2016-2018 Repositioning the Platform – 2019 Seven new Board members Management   Added outside executive talent / Governance +  Hired/promoted 40% new leaders Utilities Refocused $8.4B t

  7. Slide 7: Corporate Activity and Focus Since 2019

    Corporate Activity and Focus Since 2019 Divestitures Additions Distributed Generation Ferndale LPG Terminal 1 37.5% equity and controlling stake of Power Petrogas from SAM Holdings Generation Refocused 1 the Business Hydro Ferndale LPG Terminal Smaller Gas 25.9% equity of Petrogas from Idemitsu Util

  8. Slide 8: Increasing Durability of the Platform

    Increasing Durability of the Platform A Divesting non-Core Assets B Increasing Commercial Length C Delivering a more Durable Business 2020 Normalized EBITDA1, 2024E Normalized EBITDA1, Long-term Normalized EBITDA1, By Contract Type2 By Contract Type2 By Contract Type2 70% Contractedness 10% Contract

  9. Slide 9: Executing on Strategic Priorities to Compound Long-term Value

    Executing on Strategic Priorities to Compound Long-term Value Normalized Earnings Normalized Adjusted Net Debt1,2 / Share Price Per Share1 EBITDA1 Normalized EBITDA Performance 2018 2019 2020 2021 2022 2023 2024E 2025E 2018 2019 2020 2021 2022 2023 2024E 2025E 2018 2019 2020 2021 2022 2023 2024E 202

  10. Slide 10: Low-Risk Energy Infrastructure

    Low-Risk Energy Infrastructure Steady and Reliable Growth Low Risk Energy Investment Grade Credit Rating Strong Commercial Constructs Infrastructure Platform Commercial Contract Type2 Credit Ratings 4% Long-life infrastructure S&P Fitch Moody’s 15% Utilities assets that provide durable BBB- BBB Take

  11. Slide 11: 2025 Dividend Increase and Forward Outlook

    2025 Dividend Increase and Forward Outlook  Plan to return capital through sustainable annual $1.26/Share DIVIDEND dividend increases 2025 Dividend PHILOSOPHY  Compound at strong long-term rates that aligns with AltaGas’ long-term normalized EPS1 growth Represents 6% Y/Y increase. 50-60% Payout Ra

  12. Slide 12: Commercial De-risking will Drive Long-term Value

    Commercial De-risking will Drive Long-term Value  Global Exports tolling target of 60%+ in 2027  Active and systematic hedging for residual commodity exposure  Focus on take-or-pay and fee-for-service contracting  Customer and resource play diversification  Long-term cost contracting (Five-year

  13. Slide 13: Macro Set Up

    Macro Set Up Macro Data Points Interest Rates Inflation FX (USD/CAD) 2022 2025 2025 2022 2025 2022 Utility Key Macroeconomic Data Points nil 4x Low High Below Avg Above Avg Low High Cost of Gas Substitution Population Growth Regulatory Jurisdictions Investment Opportunities Midstream Key Macroeconom

  14. Slide 14: Fundamentals for Natural Gas and NGLs are Robust

    Fundamentals for Natural Gas and NGLs are Robust Natural Gas and NGL Adoption is Strong Across Emerging Markets, Driving Structural Tailwind Global Natural Gas Demand (1990-2040) Global NGL Demand (1990-2040) 90 18.0 Asia-Pacific Africa 80 16.0 Middle East FSU 70 14.0 Europe Latin America (MMboe/d)

  15. Slide 15: Data Centers Usage Will Alter Use and Cost of Power

    Data Centers Usage Will Alter Use and Cost of Power Northern Virginia is the Epicenter for AI and Global Data Centers Data Centers US Power Demand Share of Top U.S. Data Center Locations PJM – Data Center Power Demand Forecast 700 Terawatt-hours 12% Data Center Consumption 600 Share of US Power Dema

  16. Slide 16: DMV Population and Demographics Provide Strong Tailwind

    DMV Population and Demographics Provide Strong Tailwind Population Growth Across WGL Service Territories1 Cumulative Customer Additions Across WGL2 (2012 - 2023) (2012 - 2023) 200,000 16% WGL service territories 180,000 WGL has added new are growing 14% customers at 12% 40% 160,000 ~1% faster than t

  17. Slide 17: Canadian Midstream Set-up is Compelling

    Canadian Midstream Set-up is Compelling Rising WCSB Production and Global Connectivity Underpin Strong Multi-year Growth Trajectory WCSB NGL Supply Growth (2020-2030) Asian LPG Demand (2015-2050) 2.00 7.0 China India 6.0 Japan 1.50 South Korea 5.0 Indonesia Other Asia 4.0 (MMBbl/d) (MMBbl/d) 1.00 3.

  18. Slide 18: Asian LPG Import Demands to Grow >40% by 2040

    Asian LPG Import Demands to Grow >40% by 2040 Propane and Butane Imports to Grow to 4.0 MMBbl/d Asian Propane Import Demand (2022  2040) Asian Butane Import Demand (2022  2040) (Domestic Demand – Domestic Supply = Import Requirements) (Domestic Demand – Domestic Supply = Import Requirements) 2,500

  19. Slide 19: Canada: Natural Gas and NGL Outlook is Robust

    Canada: Natural Gas and NGL Outlook is Robust Canadian Natural Gas Production (2020-2030) WCSB NGL Outlook, by Product (2020-2030) WCSB NGL Outlook, by Play (2020-2030) 25 2,000 2,000 Cardium Deep Basin Duvernay Cardium Deep Basin Duvernay Ethane Propane Alberta Montney BC Montney Other 1,800 Butane

  20. Slide 20: Alberta: Marked Montney Liquids-rich Growth on Horizon

    Alberta: Marked Montney Liquids-rich Growth on Horizon Alberta Montney NGL Outlook (2020-2030) Deep Basin NGL Outlook (2020-2030) 800 250 700 200 600 500 150 MBbl/d MBbl/d 400 100 300 200 50 Pipestone Growth Area Harmattan Growth Area 100 0 0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 20

  21. Slide 21: BC: Progressing Resource Stewardship Efforts Supports Development

    BC: Progressing Resource Stewardship Efforts Supports Development B.C. Well Permits (2018-2023 YTD) B.C. Montney NGL Supply, by Area (2020-2030) B.C. Montney NGL Supply, by Product (2020-2030) 500 500 1,000 Blueberry/Northern BC 450 Ethane Propane 900 450 Dawson Creek Butane Natural Gasoline 800 400

  22. Slide 22: Canadian LNG Developments Drive Adjacent Opportunities

    Canadian LNG Developments Drive Adjacent Opportunities Associated LPGs1 Project Summary Export Capacity (Propane / Butane) Phase 1 Liquids Per Phase $48B Phase 1 LNG export 14 mmtpa facility in Kitimat, BC with ~50 Mbbl/d an expected 2025 in- Phase 2: service date. +14 mmtpa 20-25 Mbbl/d $6.4B LNG e

  23. Slide 23: Excess Canadian LPGs Best Served in Premiere Asian Markets

    Excess Canadian LPGs Best Served in Premiere Asian Markets WCSB Propane Supply Available for Exports (2022-2040) 450 400 Traditional Regional Demand Eastern CAD Demand PDH Available to Export 350 WCSB LPG Available for Exports (2022-2040) 300 350 MBbl/d 250 200 300 Total LPG Propane Available Availa

  24. Slide 24: High Growth Rate Regulated Utilities Platform

    High Growth Rate Regulated Utilities Platform High Growth Utilities Platform 2024E Utility Revenues  ~1.6 million customers with population growing ~40% faster than the national average1  ~70% of revenue from residential customers 70% Residential  Limited weather/usage sensitivity across ~70% of

  25. Slide 25: Utilities Strategic Focus

    Utilities Strategic Focus 1 2 3 4 Growth Improve Invest in Core Opportunities Policy / Returns Platform related to Advocacy Climate Leadership Initiatives  Continue closing the  Modernize network  Focus on energy  Build alliances with ROE gap to enhance safety efficiency programs, multiple advoc

  26. Slide 26: Continuing to Improve Returns at WGL

    1 Continuing to Improve Returns at WGL ~$40MM of C Lever to help partially offset D potential annual net income value creation1 C E Allowed ROE B C ~$70MM of D annual net income value creation1 A B 20-40 bps Operational Excellence: Cost D 30-60 bps A ~120 bps and efficiency Regulatory Lag: +220 bps

  27. Slide 27: Address Aging Infrastructure

    Address Aging Infrastructure 2 Utilities Positioned for Large Ongoing Investment Opportunities (Miles) 2,000 Iron Plastic Protected Steel Others 1,500 D.C. 1,000 500 0 2,000 1,500 Maryland 1,000 500 0 2,000 1,500 Michigan 1,000 500 0 2,000 1,500 Virginia 1,000 500 0 Notes: *See "Forward- looking Inf

  28. Slide 28: Accelerated Replacement Programs

    Accelerated Replacement Programs 2 The Foundation for Improved Safety and Reliability with Better Outcomes for All Stakeholders Approximately US$1.4 billion of System Reinforcement Projects over next 5 years1 APRP Maturity (Year) 2023 2024 2025 2026 2027 2028 New STRIDE 3 Plan Maryland US$330MM US$3

  29. Slide 29: Invest in Core Platform

    2 Invest in Core Platform Investments in WGL since 2018 Material Decline in Leaks1 New Business WGL SEMCO System Betterment/Other C$4.0 billion 55% reduction in ARP investments invested leaks over the in WGL are paying ARP Programs off with material past five years reductions in leaks; which is driv

  30. Slide 30: Advance System Expansion and Reliability Projects

    2 Advance System Expansion and Reliability Projects Advance pragmatic extension to service territory to bring natural gas to currently unserved customers A and progress long-term projects focused on improving system reliability B for the long-term. 10% of homes within the states Washington Gas SEMCO

  31. Slide 31: RNG Advancements

    3 3 RNG Advancements  WGL is advancing several RNG opportunities across  Pursuing various RNG interconnect opportunities the DMV within Michigan with two recently completed  Currently, five to ten in-territory facilities are  Opportunities are focused on in-territory dairy potential sources of s

  32. Slide 32: Advocating for Customer Choice

    4 Advocating for Customer Choice Advocating for Energy Choice  Washington Gas, along with local unions, restaurant associations, business counsels, housing and building associations, filed two AltaGas will be very active in statement of claims challenging two proposed local gas bans. advocacy in 20

  33. Slide 33: Premiere, Globally Connected Midstream Platform

    Premiere, Globally Connected Midstream Platform Robust long-term fundamentals, supported by West Coast LNG Industry-leading Montney footprint – positioned to attract volumes and value chain opportunities Visible near and long-term growth De-risking commercial framework Strong counter-party credit: ~

  34. Slide 34: The AltaGas West Coast Advantage

    The AltaGas West Coast Advantage AltaGas’ West Coast Advantage results in significant increases in producers’ realized LPG prices and creates tailwinds for the broader energy industry. 10-11 days 18+ 25+ days days 1 North American West Coast LPG exports have a Panama canal 1 congestion can add 10+ d

  35. Slide 35: Battle of the Barrels Leaves Asian Tolling as Clear Winner

    Battle of the Barrels Leaves Asian Tolling as Clear Winner RIPET Tolling has Averaged ~US$5/Bbl Netback Premium Over Conway Over the Past Two Years Excess Canadian propane and butane that is available for exports at Fort Saskatchewan A has two options – going to Asia B via rail and AltaGas global ex

  36. Slide 36: North America Balancing the Global LPG Market

    North America Balancing the Global LPG Market Global LPG Exports, By Country (2014-2023 YTD) Japan Approximately 4.0 3.5 • Home heating; more 90% environmentally-friendly of global LPG export delivers volumes are 19% alternative to thermal coal. delivered to Japan 3.0 and South Korea. of Japan’s tot

  37. Slide 37: Midstream Strategic Focus

    Midstream Strategic Focus 1 2 3 4 Leverage and De-risk Strengthen Evaluate Optimize Existing Operations the Midstream Growth Assets Framework Value Chain Opportunities  Focus on growing  Increased take-  Strengthen  Allocate capital to EBITDA through no- to or-pay and tolling footprint across th

  38. Slide 38: Leverage and Optimize Existing Assets

    1 Leverage and Optimize Existing Assets Low-to-No- Capital-Intensive Projects Medium Capital-Intensive Projects Larger Capital-Intensive Projects <$25MM $25MM-$200MM >$200MM Capital Spend Capital Spend Capital Spend Townsend: Whitespace Optimization Global Exports Logistics Optimizations Pipestone I

  39. Slide 39: Commercial De-risking

    2 Commercial De-risking 2024E Normalized EBITDA1, By Contract Type2 A Minimize Commodity Exposure  Increase take-or-pay and fee-for-service contracting  Take-or-Pay &  Medium-term global exports tolling target of 60%+ Fee-for-Service  Active and systematic hedging for any residual commodity expo

  40. Slide 40: Global Exports Tolling

    Global Exports Tolling 2 Building the Long-term Commercial Stack  Strong fundamentals Global Export Tolling and structural pricing Agreement Commercial 2027+ advantage support tolling agreements as growing production increases the importance of LPG netbacks. Targeting  Interest across multiple ~10

  41. Slide 41: Strengthening the AltaGas Value Chain

    3 Strengthening the AltaGas Value Chain The Multifaceted Approach to Strengthening the Franchise Gas Gathering NGL Extraction, Transportation, & Processing Fractionation & Storage and Global Exports Liquids Handling Logistics Midstream 2.1 Bcf/d1 65,000 Bbl/d2; ~4,700 rail cars, ~150,000 Bbl/d3 Proc

  42. Slide 42: Global Exports Optimization and Growth

    3 Global Exports Optimization and Growth 175+ MBbls/d 180,000  Near, medium, and long-term optimization opportunities 150,000 RIPET Ferndale across platform. Will build on track record of growing from 120,000 Bbl/d ~35 MBbls/d in 2019 to ~120 MBbls/d currently. 90,000  Includes rail, logistics, an

  43. Slide 43: REEF - A Multi-Phased Growth Project

    4 REEF - A Multi-Phased Growth Project Large-scale LPG and bulk liquids marine export terminal F Phased construction for a capital-efficient build-out E C B Phase 1: LPG and Dock A A Facility & balance of plant​ C Rail Offloading and Yard​​  ~55,000 Bbl/d of initial  10 x dual sided rail offloadin

  44. Slide 44: Ridley Island Energy Export Facility (REEF)

    4 Ridely Island Energy Export Facility (REEF) $1.35 Billion Gross Capex Project Execution Commercial Capital with Minimized Onsite Work of AltaGas’ global exports Reduces Capital Risk 56% larger field execution will operate under tolling arrangements starting in Q2/24 20% of equipment, packaging, ~9

  45. Slide 45: REEF - Logistical Advantages

    4 REEF - Logistical Advantages Marine  Deepest natural harbour in North America  Ice free port year-round  Easy VLGC access and movement  Long-term multi vessel loading capabilities  Shortest shipping distance to Japan and South Korea Rail  Comprehensive logistics network  10 dual sided rail

  46. Slide 46: Midstream Project Execution

    Midstream Project Execution REEF In Service Date: Near 2026 Year-end Pipestone II In Service Date: 2025 Year-end Milestones Cleared To-Date Milestones Cleared To-Date Final Investment Decision FEED Final Investment Decision Site Clearing Site Clearing FEED Acid Gas Wells Gathering System Project Exe

  47. Slide 47: Proven Track Record of Midstream Project Execution

    Proven Track Record of Midstream Project Execution Legend Key Project Project Targeted Completion Delivery Metrics Execution Actual Completion NEBC Program I -8 % 13 Townsend I Under Budget Total Projects  198 MMcf/d facility Project FID Completed NEBC Program II -14 % Under Budget North Pine + Tow

  48. Slide 48: 2025 Guidance Highlights

    2025 Guidance Highlights 2025 Normalized EBITDA1 2025 Dividend Increase $1.26 +6% $1.19 +6% Y/Y mid-point to Annual Increase mid-point growth 2024E 2025E 2024E 2025E 2025 Normalized EPS1 2025 Capital Program 1 Maintenance + System Betterment +2% Asset Modernization + New $1.4 Billion 2 Customer Conn

  49. Slide 49: 2025 Financial Guidance

    2025 Financial Guidance Normalized EBITDA1,2 Guidance $3.00 Normalized EPS1,3 Guidance ($ millions) Tailwinds / Headwinds $2.50 $2.10 - $2.30 $1,675 - $1,775 $1,775 - $1,875 + Higher utilization at Montney facilities $2.00 + Utility rate base growth Midstream: Midstream: + Normal weather (DC & MI) ~

  50. Slide 50: 2025 Capex Budget

    2025 Capex Budget 2025 Capital Budget: $1.4 Billion Increasing Midstream Allocation Capital deployment reflects the continued strong growth Strong organic growth opportunities across both platforms – driving opportunities. Largest 2025 capital outlays include REEF, Pipestone II, healthy competition

  51. Slide 51: 2025 Capital Allocation Breakdown

    2025 Capital Allocation Breakdown Capital focused on advancing short and long-term projects across portfolio. Capital Allocation Investment Focus Investment Return  Low capital business development and asset optimization  Mix of immediate and delayed investment returns 4 Other Growth  Pipestone I

  52. Slide 52: Recalibrated Leverage Targets

    Recalibrated Leverage Targets Previous Leverage Target New Leverage Targets Trailing Metrics (Adjusted for Higher Hybrids) (As of Q3/24) 5.0x (including 50% (including 50% debt treatment for 4.65x debt treatment for prefs + hybrids) prefs + hybrids) (excludes prefs 4.5x 4.0x (excludes prefs + hybrid

  53. Slide 53: 2024 Guidance Puts and Takes

    2024 Guidance Puts and Takes Well-positioned to achieve our 2024 guidance figures. Expect midpoint of Normalized EPS1 of $2.05 - $2.25 and upper end of Normalized EBITDA1 of $1.675 billion to $1.775 billion. 2024 Guidance Intact Largest Changes for 2024 Since Guidance was Set Normalized EBITDA1 Guid

  54. Slide 54: Mountain Valley Pipeline Update

    Mountain Valley Pipeline Update The Pipeline Q3/24  First full quarter of operations with strong operating performance and no surprises.  Partners currently evaluating ~475 MMcf per day expansion through additional compression. MVP – Bradshaw Compressor Station  Proposed 3.5 GW VA power plant for

  55. Slide 55: 2025 Hedging

    2025 Hedging  Increase tolling and reduce commodity exposure to further stabilize Midstream cashflows Hedging Philosophy  Residual commodity exposures actively managed through hedging program NGL Extraction Transportation, Wellhead Gas Gathering & Fractionation Storage & Rail Global & Processing L

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