Mplx Lp · NYSE:MPLX
Mplx Lp — Investor Presentation (June 2019)
40 slides from Mplx Lp's investor presentation, June 2019
Slide 1: June Investor Presentation
June Investor Presentation June 2019
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains forward-looking statements within the meaning of federal securities laws regarding MPLX LP (MPLX). These forward-looking statements relate to, among other things, the proposed acquisition of Andeavor Logistics LP (ANDX) by MPLX and include expect
Slide 3: Additional Information
Additional Information Additional Information and Where to Find It In connection with the proposed transaction, a registration statement on Form S-4 has been filed with the SEC and includes a preliminary consent statement/prospectus. INVESTORS AND SECURITY HOLDERS ARE ENCOURAGED TO READ THE REGISTRA
Slide 4: MPLX Agreement to Acquire ANDX – Transaction Highlights
MPLX Agreement to Acquire ANDX – Transaction Highlights Simplified Structure. Broader Footprint. Enhancing Returns. ● MPLX to acquire all common units of ANDX at 1.07x blended exchange ratio representing a 1% premium to market1 ● 1.1350x exchange ratio to ANDX public unitholders, representing a 7.3%
Slide 5: Simplified Organizational Structure
Simplified Organizational Structure Current1 Pro Forma1 Marathon Petroleum Corporation Marathon Petroleum Corporation (NYSE:MPC) (NYSE:MPC) Non-economic 100% GP interest Non-economic 100% GP interest Non-economic 100% GP interest Tesoro MPLX MPLX 63.0% of Logistics Common GP LLC GP LLC Units GP, LLC
Slide 6: Positioning MPLX For Long-Term Success
Positioning MPLX For Long-Term Success 2017-2018 Completed Drop Downs 2012 and IDR IPO Buy-In 2015 2019 MarkWest Strategic Combination Combination with ANDX 6
Slide 7: Key Investment Highlights
Key Investment Highlights Diversified large-cap MLP positioned to deliver attractive returns over the long term Logistics & • Expanding third-party business and delivering industry solutions Storage • Supports extensive operations of largest U.S. refiner Gathering & • Largest processor and fractiona
Slide 8: Compelling Investment Opportunity
Compelling Investment Opportunity 1.60 ⚫ Attractive returns for unitholders 3,700 3,600 3,500 $3,475 3,400 – 10% distribution growth in 2018 3,300 3,200 3,100 – Expect $0.01 per unit increase each quarter in 2019 1.50 3,000 2,900 2,800 ⚫ Gathering & Processing provides attractive growth opportunitie
Slide 9: Aligned Strategic Priorities
Aligned Strategic Priorities Capture Full Enhance Grow in Leverage Financial Midstream Cash Flow Premier MPC Discipline Value Chain Stability Basins Relationship Participate across Long-haul pipelines Permian: Fosters further Self-funding equity value chain to to add further stable significant growt
Slide 10: Capturing The Full Midstream Value Chain
Capturing The Full Midstream Value Chain Feedstock Acquisition Inbound Logistics Refining & Processing Outbound Logistics Marketing & Retail ▪ Diversification enhances opportunities for revenue capture ▪ Integration enables capture of stable fee-based revenue across the value chain ▪ Developing asse
Slide 11: U.S. Production Growth Creates Midstream Opportunities
U.S. Production Growth Creates Midstream Opportunities Strong production growth in crude, natural gas, and natural gas liquids will require additional infrastructure to link supply to global demand markets. Pipelines, processing, fractionation and export facilities will be needed to allow producers
Slide 12: Capturing Permian Opportunities
Capturing Permian Opportunities Creating an integrated footprint from Legend Crude the Permian to the Gulf Coast NGL Natural Gas 1 Gathering and processing Delaware & Midland Basins TEXAS 2 Long-haul pipelines 1 3 Fractionation 2 3 4 4 Export terminals 12
Slide 13: Permian G&P Feeds Downstream Opportunities
1 Permian G&P Feeds Downstream Opportunities Gathering systems create significant growth opportunities in the Permian TexNew Conan Mex Gathering Preakness Torñado System System Argo Apollo 1 Legend Crude pipeline To Texas City area Hidalgo Natural gas pipeline NGL pipeline To Houston To Agua Dulce C
Slide 14: Permian Crude Pipelines
2 Permian Crude Pipelines Investments in long-haul pipelines generate stable, fee-based midstream income and also help lower feedstock costs tor MPC refineries ⚫ Gray Oak Pipeline – MPC, Diamondback Energy, PSXP – ~850 mile, 30-inch diameter TEXAS – Anticipate in-service 4Q19 Wink Orla Crane ⚫ Wink-
Slide 15: Permian Natural Gas and NGL Pipelines and Fractionation
2 Permian Natural Gas and NGL Pipelines and 3 Fractionation ⚫ Whistler Residue Gas Pipeline – JV with White Water Midstream and Stonepeak/WTG – 42” pipeline with ~2.0 Bcf/d capacity – Anticipate in-service 3Q21 TEXAS ⚫ BANGL Pipeline (Belvieu Alternative NGL) Orla Waha – JV with White Water Midstrea
Slide 16: Expanding Export Capabilities
4 Expanding Export Capabilities Export facilities create ability to generate third party revenue and meet global demand for crude, refined products, and NGLs ⚫ Currently in service – Mt. Airy, LA: acquired in 3Q18 – LOOP: expansion with planned Capline reversal and Swordfish Pipeline TEXAS ⚫ Planned
Slide 17: Mt. Airy Export Terminal
4 Mt. Airy Export Terminal ⚫ Strategically located on Mississippi River in close proximity to several refineries, including MPC’s Garyville refinery ⚫ 4 MMBBL of third-party leased storage capacity, capability to expand storage capacity to 10 MMBBL ⚫ 120,000 bpd export dock, permitted for constructi
Slide 18: Capline Reversal – Swordfish - LOOP
Capline Reversal – Swordfish - LOOP Competitive full-service solution Capline – 40” crude oil pipeline from Patoka, IL, to St. James, LA – Reversed service planned for September 2020 Swordfish Pipeline – Proposed crude oil pipeline from St. James to Clovelly in Louisiana – Expected in service first
Slide 19: Logistics & Storage Segment Overview
Logistics & Storage Segment Overview ⚫ High-quality, well-maintained assets that are integral to MPC ⚫ Transports, stores, distributes and markets crude oil and refined petroleum products ⚫ Stable cash flows with fee-based revenues and minimal direct commodity exposure Fuels Pipelines Refining Termi
Slide 20: Logistics & Storage Segment
Logistics & Storage Segment ⚫ Reported 1Q19 adj. EBITDA of $559 million, which increased 12% year-over-year after adjusting for the impact of dropdowns ⚫ Pipeline throughputs averaged 3.41 MMBPD, Headquarters ~11% increase over 1Q18 MPLX Pipelines: Owned & Operated MPLX Interest Pipelines: ⚫ Progres
Slide 21: Fuels Distribution Overview
Fuels Distribution Overview Extensive Range of Scheduling and Marketing Services that Support MPC’s Refining and Marketing Operations Services Description Scheduling Annual EBITDA ~$600 MM ⚫ Supply and demand balancing ⚫ Third-party exchange, terminaling and storage Acquired Feb. 1, 2018 from MPC ⚫
Slide 22: Crude Oil Pipelines
Crude Oil Pipelines Strategically positioned to support diverse and flexible crude oil supply Owns, leases, operates, or has interest in: Crude Oil Pipeline Joint-Interest Ownership: ⚫ ~4,500 miles of crude oil pipelines ⚫ Bakken Pipeline System, 9.2% ownership, includes Dakota Access Pipeline and E
Slide 23: Product Pipelines
Product Pipelines Integrated network delivering refined products to key market areas Owns, leases, operates or has interest in: ⚫ ~5,500 miles of product pipelines ⚫ Strategically positioned to transport products from MPC refineries to MPC’s marketing operations ⚫ Integrated with expansive network o
Slide 24: Refining Logistics Overview
Refining Logistics Overview Integrated Tank Farm Assets Supporting MPC’s Operations Tanks Racks ⚫ ~56 MMBBL storage ⚫ Multiple rail and truck loading racks Docks Gasoline Blending & Associated Piping ⚫ Handle ocean- and river-going vessels ⚫ Piping to connect process units, tank at Gulf Coast refine
Slide 25: Terminal and Storage Assets
Terminal and Storage Assets Terminal and Storage Assets ⚫ Facilities provide flexibility and logistics optionality ⚫ Long-term, fee-based storage and terminal services agreements with MPC ⚫ 62 light product terminals with ~24 MMBBL of storage capacity ⚫ Tank farms and caverns: – Own and operate 16 c
Slide 26: Marine Transportation Operations
Marine Transportation Operations Highly predictable income and cash-flow stream ⚫ Transports refined products and crude oil on the Ohio, Mississippi, and Illinois rivers and their tributaries and inter-coastal waterways ⚫ 256 barges, 23 towboats as of December 31, 2018 ⚫ Operates full-service marine
Slide 27: Organic Growth Capital Projects – Logistics & Storage
Organic Growth Capital Projects Logistics & Storage Segment Projects Description Est. Completion Date Marine Fleet Expansion Displaces MPC’s third-party barges and supports increased demand 2019 Mt. Airy Terminal Expansion Constructing 2nd 120 MBPD dock and incremental storage 2020 Provide transport
Slide 28: Gathering & Processing Segment Overview
Gathering & Processing Segment Overview • Ethane Raw Gathering • Propane Processing Mixed Fractionation NGL Natural Gas and • Normal Butane Plants NGLs Facilities Products • Isobutane Production Compression • Natural Gasoline Gathering Capacity C2 + Fractionation Capacity ⚫ We are well-positioned in
Slide 29: Gathering & Processing Segment
Gathering & Processing Segment ⚫ Reported 1Q19 adjusted EBITDA of 1Q19 Processed Volumes(a) $371 million, which increased 15% Capacity at End Average Utilization of Area of Quarter Volume Available year-over-year (MMcf/d) (MMcf/d) Capacity (%)(b) ⚫ 1Q19 volumes (% increase vs. 1Q18): Marcellus 5,720
Slide 30: Recap: Gathering & Processing Contract Structure
Recap: Gathering & Processing Contract Structure Durable long-term partnerships across leading basins Marcellus Utica Southwest Resource Play Marcellus, Upper Devonian Utica Haynesville, Cotton Valley, Woodford, Anadarko Basin, Granite Wash, Cana- Woodford, Permian, Eagle Ford Key Producer Include R
Slide 31: Organic Growth Capital Projects – Gathering & Processing
Organic Growth Capital Projects Gathering & Processing Segment Est. Completion Est. Completion Processing and Fractionation Shale Resource Capacity Gathering Date Date Omega 1 Expansion Cana-Woodford 45 MMcf/d In Service Marcellus/Utica Rich- and Dry- Ongoing Gas Gathering(a) Sherwood 12 Processing
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Slide 33: Appendix
Appendix 33
Slide 34: MPLX 2019 Outlook – Reconciliation
MPLX 2019 Outlook – Reconciliation Adjusted EBITDA and Distributable Cash Flow from Net Income ($ billion) 2019E Net income 2.2 Depreciation and amortization 0.9 Net interest and other financial costs 0.7 Adjustment for equity investment earnings & distributions 0.2 Other 0.0 Adjusted EBITDA 4.0 Adj
Slide 35: ANDX 2019 Outlook – Reconciliation
ANDX 2019 Outlook – Reconciliation EBITDA and Distributable Cash Flow from Net Earnings ($ billion) 2019E Net earnings 0.8 Depreciation and amortization 0.4 Net interest and other financial costs 0.2 EBITDA 1.4 Adjustment for equity investment earnings & distributions 0.0 Deferred revenue impacts 0.
Slide 36: Reconciliation of Adjusted EBITDA and Distributable Cash from Net Income
Reconciliation of Adjusted EBITDA and Distributable Cash from Net Income ($MM) 1Q 2019 YTD 2018 1Q 2018 YTD 2017 YTD 2016 Net income 509 1,834 423 836 434 Provision (benefit) for income taxes (2) 8 4 1 (12) Amortization of deferred financing costs 13 59 16 53 46 Loss on extinguishment of debt - 46 -
Slide 37: Reconciliation of Adjusted EBITDA and Distributable Cash from Net Cash Provided by Operating Activities
Reconciliation of Adjusted EBITDA and Distributable Cash from Net Cash Provided by Operating Activities ($MM) 3/31/2019 12/31/2018 3/31/2018 12/31/2017 12/31/2016 Net cash provided by operating activities 618 2,826 450 1,907 1,491 Changes in working capital items 141 41 178 (147) (76) All other, net
Slide 38: Reconciliation of Segment Adjusted EBITDA to Net Income
Reconciliation of Segment Adjusted EBITDA to Net Income ($MM) 1Q 2019 1Q 2018 L&S segment adjusted EBITDA attributable to MPLX LP 559 437 G&P segment adjusted EBITDA attributable to MPLX LP 371 323 Adjusted EBITDA attributable to MPLX LP 930 760 Depreciation and amortization (211) (176) (Provision)
Slide 39: Reconciliation of Segment Adjusted EBITDA to Net Income
Reconciliation of Segment Adjusted EBITDA to Net Income Drop Impact 1Q 2019 ($MM) Drop(a) 1Q 2019 without Drop L&S segment adjusted EBITDA attributable to MPLX LP 490 69 559 G&P segment adjusted EBITDA attributable to MPLX LP 371 - 371 Adjusted EBITDA attributable to MPLX LP 861 69 930 Depreciation
Slide 40: Reconciliation of LTM Net Income to LTM Pro Forma Adjusted EBITDA
Reconciliation of LTM Net Income (Loss) to LTM Pro Forma adjusted EBITDA ($MM) 1Q 2019 1Q 2018 LTM Net income 1,920 1,072 LTM Net income to adjusted EBITDA adjustments 1,725 1,269 LTM Adjusted EBITDA attributable to MPLX LP 3,645 2,341 LTM Pro forma adjustments for acquisitions 4 888 LTM Pro forma a