Duke Energy Corporation (holding Company) · NYSE:DUK
Duke Energy Corporation (holding Company) — Corporate Update (December 2004)
24 slides from Duke Energy Corporation (holding Company)'s corporate update, Dec 17, 2004
Slide 1: Investor Chat Series
Investor Chat Series December 17, 2004 Tom O’Connor President & CEO Duke Energy Gas Transmission
Slide 2: Safe Harbor Statement
Safe Harbor Statement Under the Private Securities Litigation Act of 1995 This document contains forward looking information which is subject to risks and uncertainties, including, but not limited to, changes in the utility regulatory environment, the impact of competition from other energy supplier
Slide 3: Duke Energy Gas Transmission System
Duke Energy Gas Transmission System BC Pipeline & Field Services Union Gas Service Area Maritimes & Northeast Dawn Hub Algonquin Storage Capacity more than 250 Bcf Texas Miles of Transmission Pipe more than 17,500 Eastern System Compressor Horsepower 3,000,000 Miles of Distribution Main 21,000 East
Slide 4: DEGT Strategic Position
DEGT Strategic Position • Our assets access multiple supply sources and are attached to premium markets • Storage integration adds flexibility, reliability and differentiates our product • We add value by integrating our physical assets, organization and information technology • Our regulated assets
Slide 5: Expansion Projects – In Service 2004
Expansion Projects – In Service 2004 BC Pipeline & Field Services Union Gas Service Area Maritimes & Capacity Northeast Distrigas 60 Mdth/d Dominion 223 Mdth/d Algonquin Distrigas Union Gulfstream 350 Mdth/d Gas M1 197 Mdth/d Saltville 1-6 Bcf Dominion Texas Eastern M1 Expansion East Tennessee Saltv
Slide 6: Identified Expansion Opportunities – 2005 & Beyond
Identified Expansion Opportunities – 2005 & Beyond BC Pipeline Sikanni & Field Services South Peace River LNG Pipeline Projects Pine River Union Gas Islander East Service Area Maritimes LNG 50% Maritimes & Dawn-Trafalgar Northeast Excelerate NE Gateway Sarnia Pool 50% Union Algonquin KLNG Lateral Ga
Slide 7: LNG – A Requirement For Growth
LNG – A Requirement For Growth Demand Growth ● Demand to grow by 1.8% to 2.9% annually (1) on average in DEGT East Coast market area through 2010 ● Growth driven by LDC winter demand and electric generation Production Decline ● Gulf production anticipated to decline by 2.3% to 2.6% annually (1) on a
Slide 8: Areas of DEGT Focus for LNG Related Opportunities
Areas of DEGT Focus for LNG Related Opportunities Maritimes & Northeast Union Gas Algonquin Dawn Hub Texas Eastern East Tennessee Egan Gulfstream 8
Slide 9: Areas of DEGT Focus for LNG Related Opportunities
Areas of DEGT Focus for LNG Related Opportunities Maritimes & Northeast Union Gas Algonquin Dawn Hub • Existing LNG terminals averaged 1.8 Bcf/d of sendout in 2004; expected sendout of Texas 3.5 Bcf/d in 2010 Eastern East Tennessee Egan Eastern U.S. LNG Terminals Current LNG Terminals Gulfstream 9
Slide 10: Areas of DEGT Focus for LNG Related Opportunities
Areas of DEGT Focus for LNG Related Opportunities Maritimes & Northeast Union Gas Algonquin Dawn Hub • Existing LNG terminals averaged 1.8 Bcf/d of sendout in 2004; expected sendout of Texas 3.5 Bcf/d in 2010 Eastern • About 30 new facilities announced in Eastern East North America Tennessee • Sitin
Slide 11: Areas of DEGT Focus for LNG Related Opportunities
Areas of DEGT Focus for LNG Related Opportunities MARKET AREA INFRASTRUCTURE Maritimes & OPPORTUNITIES Northeast Union NORTHEAST LNG Gas Algonquin OPPORTUNITIES Dawn Hub Texas Eastern GULF LNG East OPPORTUNITIES Tennessee Egan Eastern U.S. LNG Terminals Current LNG Terminals LNG Terminal Projects Gu
Slide 12: Northeast LNG Connection Strategy
Northeast LNG Connection Strategy • Actively pursue all LNG attachments • Position M&NE, Algonquin and TETLP as key conduits Maritimes & to markets Northeast Union NORTHEAST LNG • Capture efficient expansion Gas Algonquin OPPORTUNITIES Dawn opportunities from dynamic Hub supply shift Texas Eastern D
Slide 13: Gulf Coast Connection Strategy
Gulf Coast Connection Strategy Maritimes & Northeast Union Gas Algonquin Dawn Hub • Create Gulf Coast supply header Texas connected to Egan storage Eastern GULF LNG East • Secure multiple terminal OPPORTUNITIES Tennessee connections to header Egan • Enhance liquidity / optionality for suppliers thro
Slide 14: Gulf Coast Supply Header / Egan Hub
Gulf Coast Supply Header / Egan Hub Moss Bluff Storage Egan Storage BG LNG Lake Charles, LA Sempra Cameron, LA Henry Hub Cheniere Sabine Pass, LA Gulf Coast Header ExxonMobil Cheniere Cameron, LA • 110 miles of pipeline • 2.6 Bcf/d capacity Sabine Pass, TX Egan Storage • 16 Bcf expandable to 40 Bcf
Slide 15: Market Area Optimization Opportunities
Market Area Optimization Opportunities MARKET AREA INFRASTRUCTURE Maritimes & OPPORTUNITIES Northeast Union Gas Algonquin Dawn Hub • Customers are developing long-term supply Texas strategies Eastern • Focus on growing winter/peak demand East combined with ability to mitigate price spikes Tennessee
Slide 16: DEGT Northeast Open Season Results
DEGT Northeast Open Season Results 54 BCF Maritimes & of Northeast Storage at Union Dawn Gas Algonquin Open Season Nominations Texas • 1.8 Bcf/d on Union (Dawn to Eastern Eastern Canada) • 0.7 Bcf/d on Union (Dawn to Northeast) East Tennessee • 54 Bcf of storage at Dawn • 1.2 Bcf/d on Algonquin • 0.
Slide 17: Market Area Development Strategy
Market Area Development Strategy DEGT has a two-step strategy to participate in the increased infrastructure needs of East Coast markets ME Step 1: M&NE (0.5-1.0 Bcf/d) • Expand existing market area transmission and storage VT Maritimes & • Provide infrastructure to connect Michigan / Ontario NH Nor
Slide 18: Conclusion
Conclusion • DEGT has an exceptional asset base attached to key growth markets and diverse supplies • Near-term opportunities are driven by traditional market growth, storage requirements and supply expansion which were confirmed by the DEGT Open Season • New LNG supply will realign supply, resultin
Slide 19: Initial Outlook for 2005
Initial Outlook for 2005 Fred Fowler President and COO Duke Energy Corporation
Slide 20: 2005 Earnings per Share
2005 Earnings per Share • Earnings per share incentive ● Incentive target of $1.60 per ongoing basic share ● Minimum payout at $1.45 per ongoing basic share • 2004 vs. 2005 + Lower losses at DENA; expect $150 million loss in 2005 + Strong commodity prices at Field Services – Crescent Resources retur
Slide 21: Field Services
Field Services • 2005 segment EBIT scenarios – Assumptions • Current hedging for NGL production is 63% at 12/10/04 • All other factors remain the same, except crude prices – If crude goes to $40 per barrel then segment EBIT would be approximately $500 million – If crude goes to $30 per barrel then s
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Slide 23: Duke Energy Gas Transmission
Duke Energy Gas Transmission The Company's script and prepared remarks for the December 17, 2004 analyst conference call on "LNG Discussion and Initial Views on 2005" include a statement that Duke Energy Gas Transmission (DEGT) should produce 3-5% annual EBIT growth from adjusted base of $1.226 bill
Slide 24: GAAP financial measure is not available at this time
GAAP financial measure is not available at this time as the Company is unable to project any "special items" for 2005. 2005 DENA Segment EBIT The Company's prepared remarks for the December 17, 2004 analyst conference call on "LNG Discussion and Initial Views on 2005" includes a discussion of DENA's