Kinder Morgan, Inc. · NYSE:KMI
Kinder Morgan — Kinder Morgan Energy Partners — 2008 KMP Analyst Conference
44 slides from Kinder Morgan's conference presentation, Jan 24, 2008
Slide 1: Terminals
ENERGY PARTNERS, L.P. Terminals Jeff Armstrong President Terminals Groups
Slide 2: Kinder Morgan Terminal Locations
Kinder Morgan Terminal Locations ENERGY PARTNERS, L.P. (2) (2) (3) (2) (2) (2) (2) (2) (2) (2) (2) (4) Netherlands (3) (3) (2) (2) (2) (2) Legend (4) (3 (4) Dry Bulk Locations Product Pipelines Locations (2) 7 Louisiana Terminals Ferro Operation Locations Liquid Locations Myrtle Grove to Baton Rouge
Slide 3: Historical Growth
ENERGY PARTNERS, L.P. Historical Growth 2007 2008 (1) (2) 2002 2003 2004 2005 2006 Actual (2) Budget Earnings before DD&A 208,963 240,774 263,168 318,140 396,858 442,330 550,178 Growth from prior year 25.94% 15.22% 9.30% 20.89% 24.74% 11.46% 24.38% Internal 7.51% 7.47% 4.49% 3.97% 14.16% 2.33% 15.20
Slide 4: New Acquisitions 2007
ENERGY PARTNERS, L.P. New Acquisitions 2007 Hickman, Arkansas Marine Terminals, Inc. 2008 EBITDA Materials Handled: (Budget) • Inbound - carbon scrap, pig iron, HBI, and DRI $34.9MM • Outbound - steel Services Provided: Decatur, Alabama Blytheville, Arkansas • Harbor Service • Port Operations • Scra
Slide 5: New Acquisitions 2007
ENERGY PARTNERS, L.P. New Acquisitions 2007 Vancouver Wharves 2008 EBITDA (Budget) – $25.2 MM (USD) • Total area - 111 acres, 5 deep-sea berths in total • Bulk commodities handled: Mineral concentrates (lead, zinc and copper), sulfur, specialty agriculture products and pulp • 3.4 million tons antici
Slide 6: New Acquisitions 2007
ENERGY PARTNERS, L.P. New Acquisitions 2007 MidShip Group 2008 Earnings (Budget) - $2MM • Purchased 25% of the membership interest of Midship Group LLC • Headquartered: Port Washington, N.Y. • Handle approximately 40/45 million tons of bulk cargo per year • Handle parcels of 1,000 tons up to capesiz
Slide 7: 2007 - 2008 Internal Expansion Projects
ENERGY PARTNERS, L.P. 2007 - 2008 Internal Expansion Projects In-Service Total Location Project Product Capacity Date Investment Perth Amboy Houston Ship Dock 4 Petroleum 3Q08 20,209 Houston East Plant Tanks Clean Petroleum 200k Bbls 1Q07 10,004 Houston Tanks Clean Petroleum 950k Bbls 2Q08 43,191 Ho
Slide 8: Bulk Tonnage
ENERGY PARTNERS, L.P. Bulk Tonnage 2007 Budget 2008 Coal 29,370,780 33,165,721 Petcoke 15,266,193 15,646,888 Cement (Including Clinker) 925,385 1,455,174 Fertilizers 5,651,112 6,788,342 Salt 3,171,629 3,349,116 Ores/Metals (Bulk) 16,665,815 25,769,767 KMBT Tonnage Ores/Metals (Break-Bulk) 6,274,170
Slide 9: Liquids Throughput
ENERGY PARTNERS, L.P. Liquids Throughput 2007 Budget 2008 Chemical 26,128,757 22,671,455 Distillate 194,808,373 195,682,748 Petroleum 297,099,900 345,557,755 Fuel Grade Ethanol 25,624,535 30,209,610 Other 4,400,269 8,521,548 KMLT Throughput Vegetable Oils 8,494,806 10,676,370 (bbls) Animal Fats 264,
Slide 10: Renewable Fuels
ENERGY PARTNERS, L.P. Renewable Fuels 10
Slide 11: U.S. Ethanol Biorefinery Locations
ENERGY PARTNERS, L.P. U.S. Ethanol Biorefinery Locations __________________________ Source: Renewable Fuels Association 10/04/07 11
Slide 12: U.S. Energy Independence and Security Act Highlights
ENERGY PARTNERS, L.P. U.S. Energy Independence and Security Act Highlights Sets an increased phase-in for renewable fuel volumes beginning with 9 billion gallons in 2008 and ending at 36 billion in 2022. 15 billion of new mandate will be made up of corn based ethanol. 21 billion of new mandate to be
Slide 13: Biofuels Mandate: 2005 Law vs. 2007 Law
ENERGY PARTNERS, L.P. Biofuels Mandate: 2005 Law vs. 2007 Law Year Billion Gallons MB/D 2005 LAW 2007 LAW 2005 LAW 2007 LAW 2007 4.7 -- 307 -- 2008 5.4 9 352 587 2009 6.1 11.1 398 724 2010 6.8 12.95 444 845 2011 7.4 13.95 483 910 2012 7.5 15.2 489 992 2015 -- 20.5 -- 1,337 2022 -- 36 -- 2,340 ______
Slide 14: U.S. Ethanol Capacity Increasing Rapidly
ENERGY PARTNERS, L.P. U.S. Ethanol Capacity Increasing Rapidly Average Ethanol Capacity 2006 2007 2008 5 billion gallons 6.5 billion gallons 10.25 billion gallons 326,157 BPD 424,005 BPD 668,623 BPD __________________________ Source: PIRA 28th Annual Retainer Client Seminar 14
Slide 15: Chicago Ethanol and ULR Prices and Differential
ENERGY PARTNERS, L.P. Chicago Ethanol and ULR Prices and Differential __________________________ Source: PIRA 28th Annual Retainer Client Seminar 15
Slide 16: Kinder Morgan Ethanol Handling Locations
ENERGY PARTNERS, L.P. Kinder Morgan Ethanol Handling Locations BioDiesel 2006 2007 2008 KMT ETOH 2006 2007 2008 Storage (Mbbls) 86 677 927 Storage (Mbbls) 2,500 3,038 3,543 Throughput (Mbbls) 462 1,800 2,700 Throughput (Mbbls) 22,184 25,624 30,209 Perth Amboy Carteret, NJ Chicago, IL Cleveland Phila
Slide 17: KMT Response to Ethanol Market
ENERGY PARTNERS, L.P. KMT Response to Ethanol Market 2007 Added tank space in all major markets; Houston, New Orleans, NY Harbor, Chicago, and Philadelphia. Increased storage to over 3MM Bbls, increased throughput from 22MM Bbls to 25.6 MM Bbls. Expanded transload capabilities in 15 RFG markets. Red
Slide 18: Commercial Biodiesel Production Plants
ENERGY PARTNERS, L.P. Commercial Biodiesel Production Plants __________________________ Source: National Biodiesel Board, September 7, 2007 18
Slide 19: Biofuels Supply in U.S. and Europe
ENERGY PARTNERS, L.P. Biofuels Supply in U.S. and Europe __________________________ Source: PIRA 28th Annual Retainer Client Seminar 19
Slide 20: Green Earth at Kinder Morgan Galena Park, TX
ENERGY PARTNERS, L.P. Green Earth at Kinder Morgan Galena Park, TX 86 mmgpy capacity on line October 2007 Produced/sold over 15 million gallons through end of 2007 Utilizes 5 acres of KM land KM provides 300M Bbls of storage to support the plant Access to export market as well as largest distillate
Slide 21: KM Response to Biodiesel Markets
ENERGY PARTNERS, L.P. KM Response to Biodiesel Markets Expanded storage in Chicago, NY Harbor, Houston, New Orleans, and Philadelphia. Participated as origination point for pipeline test blends of B5. Worked with producer Green Earth to provide terminaling for 86 million gpy production facility at K
Slide 22: Fertilizer
ENERGY PARTNERS, L.P. Fertilizer 22
Slide 23: U.S. Fertilizer Demand
ENERGY PARTNERS, L.P. U.S. Fertilizer Demand __________________________ Source: Blue, Johnson Associates, Inc., Blue Book, 2007 Edition 23
Slide 24: U.S. Urea (1990 through 2007)
ENERGY PARTNERS, L.P. U.S. Urea (1990 through 2007) MMStons 5.25 7.25 6.25 4.25 5.25 3.25 4.25 3.25 2.25 2.25 1.25 1.25 0.25 0.25 1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 Imports Production __________________________ Source: Blue, Johnson Associates, Inc., Blue Book, 2007 Edition 24
Slide 25: Kinder Morgan Response
ENERGY PARTNERS, L.P. Kinder Morgan Response 2003 & 2006 Port Sutton Terminal Expansion Project (Florida) $9.8 Million 2004 Hartford Street Expansion Project (Florida) $2.0 Million 2005 Black Hawk - New Acquisition (Waterloo, IA) $1.9 Million Blytheville Terminal – Acquisition plus Build-out (Arkans
Slide 26: Clean Petroleum Products
ENERGY PARTNERS, L.P. Clean Petroleum Products 26
Slide 27: U.S. Refinery Construction Outlook through 2014
ENERGY PARTNERS, L.P. U.S. Refinery Construction Outlook through 2014 Process Unit Additions (Thousands of Barrels per Day) Crude Year Distillation Coking Cracking Octane HDS 2008 129 45 40 0 40 2009 166 85 133 20 155 2010 730 275 265 223 378 2011 76 152 64 5 95 2012 - 2014 300 155 140 80 210 Total
Slide 28: U.S. Refinery Construction Outlook through 2014
ENERGY PARTNERS, L.P. U.S. Refinery Construction Outlook through 2014 Estimated Production Increases (Thousands of Barrels per Day) Total Year Gasoline Distillates Other Production 2008 58 47 24 129 2009 117 78 -29 166 2010 285 333 112 730 2011 20 37 19 76 2012 - 2014 136 105 59 300 Total 616 600 18
Slide 29: Non-U.S. Refinery Construction Outlook through 2014
ENERGY PARTNERS, L.P. Non-U.S. Refinery Construction Outlook through 2014 Process Unit Additions (Thousands of Barrels per Day) Location Crude Vacuum Coking FCCU HCU Canada / Mexico 500 270 139 80 45 Central & S. America 1,231 660 390 189 169 Europe / FSU 621 231 143 150 298 Middle East 3,441 1,265
Slide 30: Non-U.S. Refinery Construction Outlook through 2014
ENERGY PARTNERS, L.P. Non-U.S. Refinery Construction Outlook through 2014 Estimated Production Increases (Thousands of Barrels per Day) Total Location Gasoline Distillate Residual Fuel Other Products Production Canada / Mexico 225 177 11 87 500 Central & S. America 562 398 (55) 326 1,231 Europe 70 1
Slide 31: World Refinery Expansions will Outpace Oil Demand Growth in 2009+
ENERGY PARTNERS, L.P. World Refinery Expansions will Outpace Oil Demand Growth in 2009+ __________________________ Source: PIRA 28th Annual Retainer Client Seminar 31
Slide 32: Declining European Mogas Demand Leads to More Exports to U.S.
ENERGY PARTNERS, L.P. Declining European Mogas Demand Leads to More Exports to U.S. __________________________ Source: PIRA 28th Annual Retainer Client Seminar 32
Slide 33: Increasing Growth in Refinery Conversion Capacity
ENERGY PARTNERS, L.P. Increasing Growth in Refinery Conversion Capacity Will Increase Light Product Supply and Tighten Resid __________________________ Source: PIRA 28th Annual Retainer Client Seminar 33
Slide 34: Growing Global Ethanol and Biodiesel Production
ENERGY PARTNERS, L.P. Growing Global Ethanol and Biodiesel Production Adds to Light Product Supply / Reduces Crude Runs __________________________ Source: PIRA 28th Annual Retainer Client Seminar 34
Slide 35: KM Response
ENERGY PARTNERS, L.P. KM Response Total tankage increase from January 2007 43.3 MBbls December 2008 52.9 MBbls 3.75 million barrels new capacity in the 1Q08 Potential 2.4 million barrels of new tankage in 2009 Build two new ship docks (Galena Park and Staten Island) Increased Supply + Increased Vola
Slide 36: Coal / Petcoke
ENERGY PARTNERS, L.P. Coal / Petcoke 36
Slide 37: Coal Imports
ENERGY PARTNERS, L.P. Coal Imports U.S. Coal Imports Declining Central and Northern Appalachian production, affecting U.S. Coal Imports Eastern Utilities 40,000 37,000 Tougher Environmental regulations on SO2 36,246 35,750 35,000 U.S. Utilities continue to diversify supply & transportation 30,460 Ki
Slide 38: Coal Exports
ENERGY PARTNERS, L.P. Coal Exports U.S. Coal Exports U.S. Coal Exports 80,000 75,500 Increased demand from Asian Markets (China & India) 70,000 Transportation & Port Infrastructure problems in Australia has dept dept coal 60,000 56,052 out of the traditional Asian Markets 50,000 48,666 47,998 49,942
Slide 39: Petroleum Coke Production Trends
ENERGY PARTNERS, L.P. Petroleum Coke Production Trends World Production 2007 ~ 90 MDMT * est. 2000 = 56 MDMT 1995 = 41 M/DMT 75% (~67 DMT in ‘07) is fuel grade 25% (~23 DMT in ‘07) is calcined grade World Production will be 125+ M/DMT by 2012; North America will be 75 M/DMT (N.A. = 48 M/DMT in
Slide 40: World Petcoke Production - 2007
ENERGY PARTNERS, L.P. World Petcoke Production - 2007 Total Production ~ 90 million DMT Total US Production ~ 41 DMT Latin America ~20% Asia (ex China) 7% China Fuel- 7% Calcined Grade EU 2% Other U.S. & 4% Canada ~60% Fuel Grade ~ 67 million DMT US Fuel Grade ~ 35 million DMT ______________________
Slide 41: Steel
ENERGY PARTNERS, L.P. Steel 41
Slide 42: Steel Supply/Demand in the United States
ENERGY PARTNERS, L.P. Steel Supply/Demand in the United States All data – short tons Estimated 2002 2003 2004 2005 2006 2007 Production 102,000 103,000 109,000 103,000 109,000 108,000 Shipments 99,200 106,000 112,100 103,000 109,000 107,000 Exports 6,000 8,200 7,900 9,400 9,700 11,100 All Imports 32
Slide 43: KM Network of Steel Terminals
ENERGY PARTNERS, L.P. KM Network of Steel Terminals Deepwater Ports River Ports and Houston Ship Channel Transload Services Chicago West IL Decatur AL Ontario CA Chesapeake Bulk MD Guntersville AL Stockton CA Pinney Dock (Ashtabula) OH Trinity, AL AL Denver CO Fairless Hills PA Barfield, AR AR Ocala
Slide 44: SeverCorr
ENERGY PARTNERS, L.P. SeverCorr Site: Columbus, Mississippi Water: Mile 331 on the Tenn-Tombigbee Waterway Plant Site: 8 Road Miles from the River dock Plant Site Steel Produced: 1.5 Mil TPY of Automotive Grade Steel Commodities: Inbound - Carbon Scrap, Pig Iron, HBI, DRI and Ferroalloys Outbound –
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