Kinder Morgan, Inc. · NYSE:KMI

Kinder Morgan — Kinder Morgan 2015 Analyst Conference

31 slides from Kinder Morgan's conference presentation, Jan 28, 2015

  1. Slide 1: Terminals

    Terminals John Schlosser President Terminals Group

  2. Slide 2: Terminal Network

    Terminal Network Largest Independent Terminal Operator in North America KM Terminal Facilities Bulk 78 Terminals* Liquids 39 Terminals* Transload 8 Transload Operations* Total KMT 125 KMPP 56 Liquid Terminals Grand Total 181 Terminals Jones Act Tankers 7 __________________________ *Includes 31 Termi

  3. Slide 3: Historical Growth

    Historical Growth ($ in thousands) 2012 2013 2014 2015 Actual Actual Actual Budget (e) Earnings before DD&A (a) $752,303 $797,875 $978,842 $1,173,761 Revenue (net) $1,343,294 $1,388,319 $1,689,930 $1,897,334 Opex 587,713 576,822 681,381 672,286 EBITDA $755,580 $811,497 $1,008,550 $1,225,048 Book Inc

  4. Slide 4: Contract Diversification

    Contract Diversification Liquids Revenue Breakout (a)(d) Bulk Revenue Breakout (a)(d) (d) Top-10 Customers (a) 4-yr Avg. Contract Life (b) Top-10 Customers $587MM Liquids 4.0 Years Total Revenue (c) $1,911MM Bulk 3.9 Years __________________________ (a) 2015 budget (b) 2015 budget weighted average,

  5. Slide 5: Bulk Tonnage

    Bulk Tonnage Variance to Budget Actual Budget Amt % 2014 2015 Coal 29,349,314 29,910,892 561,578 1.9% Ores/Metals (Bulk & Break-Bulk) 20,113,362 19,780,017 18,348 0.1% Petcoke 12,268,075 13,724,320 1,456,245 11.9% Soda Ash 4,603,730 4,810,359 206,629 4.5% KMBT Tonnage Fertilizers 2,218,553 2,927,907

  6. Slide 6: Liquids Throughput

    Liquids Throughput Variance to Budget Actual Budget Amt % 2014 2015 Gasoline 332,909,289 391,233,812 58,324,523 17.5% Petroleum Feedstocks* 95,533,246 324,496,022 228,962,776 239.7% Distillate 131,124,818 109,805,804 (21,319,014) -16.3% Fuel Grade Ethanol / Bio-diesel 70,225,058 71,597,390 1,372,332

  7. Slide 7: Major Projects – Backlog (Liquids)

    Major Projects – Backlog Modeled Capacity* Capital First Full Expected Avg. Contract Project Name Product (MMBBLS) (MM) Year EBITDA In Service Length** Galena Park Tank Project Refined Products 1.2 $123.8 Q3/14 - Q4/15 8 Edmonton Rail Terminal (Imperial JV) (A) Crude 0.5 $248.8 Q4/14 - Q1/15 5 State

  8. Slide 8: Major Projects – Placed In-Service in 2014

    Major Projects – Placed In-Service in 2014 Modeled First Full Capacity* Capital Year Expected Avg. Contract Project Name Product (MMBBLS) (MM) EBITDA** In Service Length*** Edmonton Tank Expansion Phase I Crude 3.4 $290.4 Q4/13 - Q1/14 12 Splitter Project Support Infrastructure Refined Petroleum 0.8

  9. Slide 9: Resource Cascade – KM Terminals

    Resource Cascade – KM Terminals Terminal’s Growth Opportunities Driven from North American Resource Development  Customers and services across multiple industry segments, commodities and North American markets  Complementary investments across Kinder Morgan’s other business segments  Increasing n

  10. Slide 10: Terminals Segment in a Lower Oil Price World

    Terminals Segment in a Lower Oil Price World Risk Assessment Opportunity Assessment Terminal’s Performance Largely Insulated from Terminal’s Growth Opportunities May Improve Lower Crude Oil Prices with Lower Crude Oil Prices  No direct price exposure  Capital development - 100% fee-based business

  11. Slide 11: Crude

    KINDERMORGAN Crude

  12. Slide 12: Crude Fundamentals

    Crude Fundamentals Continued need to connect crude oil production growth with refining markets  Logistics will play an increasingly important role as producers look to maximize wellhead netbacks  Expected development of both U.S. shale (Bakken, Permian, Eagle Ford) and Canadian oil sands Source: E

  13. Slide 13: Kinder Morgan Response

    Kinder Morgan Response  Edmonton, Alberta 2014 Completed 2015 Development  Edmonton Tank Expansion Phase 1  Edmonton Rail Terminal - Added 3.4MM BBLs of storage capacity - 50% KM / 50% Imperial JV - Capex: $290.4MM - 210,000 bpd crude by rail loading - In-Service: Q4/13 – Q1/14 - KM Capex: $248.8

  14. Slide 14: Deeprock Terminal

    Deeprock Terminal  Cushing, Oklahoma 2014 Completed 2015 Development  Deeprock Pony Express  Growing our capabilities alongside our - 51% KM / 29% Deeprock / 20% Tallgrass Partners and customers - 1.5 MM BBL, 6-tank expansion - Onsite Tankage - In-Service: Q4/14 - Pony Express expansions, Cushing

  15. Slide 15: Edmonton, AB

    Edmonton, AB Terminals managing $1.2 billion in new capital in Alberta terminaling and rail services  Planned and past major projects since 2008 (KM Capex $ millions) Alberta Crude Terminal North 40 Tank  50:50 JV with Keyera Terminal  40,000 bpd transloading  2.15 MM bbls capacity  Dual served

  16. Slide 16: Jones Act Tankers

    Jones Act Tankers 7 Modern Tankers in Service and 5 under Construction  Current Fleet: 3-years average remaining contract, 4-years with renewals Vessel Delivery 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Golden State Golden Jan-09 State Pelican Jun-09 State Sunshine Dec-09 Pelican State

  17. Slide 17: Jones Act Tankers

    Jones Act Tankers  Inelastic Jones Act Tanker supply with low-cost Kinder Morgan fleet - Limited U.S. shipbuilding capacity - Kinder Morgan with low-cost Jones Act fleet • Only 2-shipyards with demonstrated abilities: Aker and NASCCO • Modern and fuel efficient (average age is 4.0 years) • KM will

  18. Slide 18: Refined Product

    KINDERMORGAN Refined Product

  19. Slide 19: Refining Fundamentals

    Refining Fundamentals U.S. Refining Capacity Arguably Most Competitive Globally  Lower crude prices favor refining with gasoline and distillate demand growth  Continued need for export infrastructure and investments to run more domestic light sweet crudes Source: Valero Energy Source: Energy Infor

  20. Slide 20: Kinder Morgan Response

    Kinder Morgan Response  Refined Products Terminaling 2014 Completed 2015 Development  BOSTCO Phase 1  Galena Park Tank Project - 55% KM / 42.5% TransMontaigne/ 2.5% Other - Adds 1.2MM BBLs of storage capacity - Added 6.2MM BBLs of storage capacity - Capex: $123.8MM - KM Capex: $273.9MM - In-Servi

  21. Slide 21: Houston Ship Channel

    KM Ship Channel Summary(a) Houston Ship Channel Tanks(b) • Number • Capacity, million bbls Docks 418 43 • Ship docks 12 • Barge docks 12 • Barge berths 32 Managing over $2.0 billion in KM capital across multiple customers and businesses Connectivity • Inbound pipelines 20  Planned and past major pr

  22. Slide 22: Ethanol Fundamentals

    Ethanol Fundamentals Domestic Ethanol Demand Growth Constrained by Ethanol Blend Wall  Ethanol currently comprises 10% of total U.S. gasoline demand  RFS2 mandates are untenable with EPA delaying 2014 standards to 2015 Actual Estimated Kinder Morgan Throughput Market Share Business Segment (MM Gal

  23. Slide 23: Chemicals

    KINDERMORGAN Chemicals

  24. Slide 24: Chemicals Fundamentals

    Chemicals Fundamentals Significant Shift in U.S. Basic Chemicals to Low Cost Producer Economics Rivaling Middle East  Lower crude prices have lowered competitive advantages and flattened the supply curve  Increasing needs for capital alternatives Source: American Chemical Council Source: Internati

  25. Slide 25: Kinder Morgan Response (Chemicals)

    Kinder Morgan Response  Chemical Services Leveraging Kinder Morgan’s bulk and liquid terminals competencies as well as pipeline, rail and marine transportation Terminals  27 Terminals with Chemicals Storage  Over 11.0 million barrels of capacity Plant Infrastructure  Pipelines, rail, docks and t

  26. Slide 26: Coal

    KINDERMORGAN Coal

  27. Slide 27: U.S. Coal Exports

    Coal Fundamentals Domestic Coal Export Markets Remain Challenged  Export volumes have deteriorated from record highs due to globally competitive supply  Coal is the fastest growing fuel globally and will remain the largest source of power (source: BP Statistical Review) 140 125.8 117.7 120 107.1 9

  28. Slide 28: Kinder Morgan Response (Coal Export Terminals)

    Kinder Morgan Response  Coal Export Terminals 2014 Completed  International Marine Terminals Ph.3  Deepwater Coal Handling - Added 3.3 MM tons of throughput capacity - Added 10 MM tons of throughput capacity - Capex: $64.0MM - Capex: $183.7MM - In-Service: Q1/14 - In-Service: Q3/14  Pier IX Yard

  29. Slide 29: Deepwater Terminal

    Deepwater Terminal Kinder Morgan Terminals with multiple business offerings at our Deepwater terminal  Leveraging footprint to extend customer-base, services to drive growth, and respond to market demands  Petcoke / SIT Coke - 2006 SIT Yard from USD - Petcoke from TGS  Ethanol - 2010 Unit-Train R

  30. Slide 30: Summary

    Summary  Expected EBDDA growth 2015 – 19.9% - another record year  It’s the footprint – largest North American Network = significant capital investment opportunities  Growth driven by: — $2.1 Billion in Project Backlog – after rolling off $1.3B in completed projects — An additional $0.5 - $1.1B i

  31. Slide 31: KINDERJMORGAN

    KINDERJMORGAN

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