Crestwood Equity Partners LP — Merger or Acquisition (October 2021)
44 slides from Crestwood Equity Partners LP's merger presentation, Oct 26, 2021
Slide 1: Crestwood + Oasis Midstream Overview
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Slide 2: Company Information and Forward-Looking Statements
Company Information Crestwood Equity Partners LP Contact Information NYSE Ticker CEQP Corporate Headquarters Investor Relations (1,2) Market Capitalization ($MM) $1,907 811 Main Street investorrelations@crestwoodlp.com (2) Suite 3400 (713) 380-3081 Enterprise Value ($MM) $5,019 Houston, TX 77002 Ann
Slide 3: Merger Disclosures
Merger Disclosures No Offer or Solicitation: This communication relates to the proposed transaction between Oasis Midstream and Crestwood. This communication is for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicit
Slide 4: Crestwood + Oasis Midstream: Enhanced Scale, Synergies and Free Cash Flow
C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Crestwood + Oasis Midstream: Enhanced Scale, Synergies and Free Cash Flow Generation Drives Leading Financial Metrics 4C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Crestwood + Oasis Mid
Slide 5: Combination Creates Top-3 Williston Basin G&P Company
Crestwood + Oasis Midstream Combination Creates Top-3 Williston Basin G&P Company Crestwood to acquire Oasis Midstream for ~$1.8 billion in an equity/cash financed transaction creating a total enterprise value of ~$7 billion Expanded Market Enhanced Financial Asset Leading Accelerated Share in Core
Slide 6: Transaction Details
Crestwood + Oasis Midstream Transaction Details Key Transaction Details Crestwood to Acquire Oasis Midstream (OMP) for $1.8 billion (1) • Total consideration for all outstanding OMP units implies an at-market deal • Crestwood to assume $660MM of OMP net debt as of September 30, 2021 OAS Consideratio
Slide 7: Premier Williston Basin Midstream Franchise
Crestwood + Oasis Midstream Premier Williston Basin Midstream Franchise Highly complementary Williston Basin assets drive ~3x increase in processing capacity, ~2x increase in tier 1 drilling inventory and broadly expanded asset base across the western and northern extent of basin Combined Asset Foot
Slide 8: Favorable Bakken Fundamentals Supports Volume Growth
Crestwood + Oasis Midstream Favorable Bakken Fundamentals Supports Volume Growth Strong Bakken fundamentals support Crestwood’s ability to capture >$45MM in commercial, operational and administrative synergies through integration and optimization of Crestwood and Oasis Midstream footprints Strong Ba
Slide 9: Three-Product Services in the Delaware Basin
Crestwood + Oasis Midstream Three-Product Services in the Delaware Basin Crestwood expands its crude oil and produced water gathering capabilities with highly complementary Oasis Midstream system OMP Asset Overview Expanded Delaware Basin Position • Crude oil and produced water gathering system in L
Slide 10: Enhanced Financial Scale, Strength & Flexibility
Crestwood + Oasis Midstream Enhanced Financial Scale, Strength & Flexibility Transaction drives significant growth in Enterprise Value, Adjusted EBITDA, Distributable Cash Flow and Free Cash Flow (1) Enterprise Value 2021E Adjusted EBITDA $8,000 $1,000 +36% +37% $800 $6,000 $600 $4,000 $400 $2,000 $
Slide 11: Strong Balance Sheet Provides Financial Flexibility
Crestwood + Oasis Midstream Strong Balance Sheet Provides Financial Flexibility Combination of CEQP and OMP significantly improves balance sheet via scale and deleveraging profile Balance Sheet Positioned for Strength Pro Forma Capitalization – 9/30/2021 • CEQP ended 9/30/2021 with standalone levera
Slide 12: Strategic Alignment with Oasis Petroleum
Crestwood + Oasis Midstream Strategic Alignment with Oasis Petroleum Crestwood is pleased to welcome Oasis Petroleum, a premier pure-play Bakken E&P operator, as a new customer and equity partner Oasis Petroleum Overview Leading Pure-Play Bakken Operator • Oasis Petroleum is mid-cap E&P operator wit
Slide 13: Checking ALL Boxes for Value Creation
Crestwood + Oasis Midstream Checking ALL Boxes for Value Creation Crestwood is excited to partner with Oasis Midstream unitholders and stakeholders to create long-term value • Macro-fundamentals are favorable for long-term development of domestic hydrocarbons • The Williston and Delaware Basins are
Slide 14: Disciplined Execution and Operating Leverage Drives Strategy
C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Disciplined Execution and Operating Leverage Drives Strategy 14C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Disciplined Execution and Operating Leverage Drives Strategy 14
Slide 15: Key Investor Highlights
Key Investor Highlights • Strong track record of delivering on operational and financial targets through all commodity cycles • Operating leverage, asset utilization and significantly lower O&M and G&A enhances operating margins to >80% EXECUTION • Best-in-class midstream operator for safety, divers
Slide 16: Diversified Portfolio of Infrastructure Assets
Diversified Portfolio of Infrastructure Assets Gathering & Processing Segment Bakken • Located in five shale plays across U.S. • 2,571 miles of pipeline • 3.1 Bcf/d gas gathering Powder • 1.5 Bcf/d gas processing plants River Basin • 320 MBbls/d crude oil gathering SW • 523 MBbls/d produced water ga
Slide 17: Strong Q3 2021 Results
Strong Q3 2021 Results Q3 2021 Highlights Exceptional Operational and • Strong operational performance drives Adjusted Financial Performance EBITDA growth of 3% year-over-year • Recently achieved record daily gas gathering volumes at Arrow of 155 MMcf/d Favorable Commodity Price • Favorable crude oi
Slide 18: 2021E Financial Guidance
2021E Financial Guidance Following strong YTD results and favorable commodity prices in Q4 2021, Crestwood expects to meet or exceed its upper guidance range Revised 2021 Guidance Drivers • Strong year-to-date $570MM – $600MM Adjusted EBITDA financial results in G&P segment offset the sale of Stagec
Slide 19: Balanced Portfolio and High-Quality Customers
Balanced Portfolio and High-Quality Customers Excellent Diversity of Services, Customers and Markets Favorable commodity prices in 2021 drive upside in POP and POI contracts, supported by fixed fee agreements and top tier customer base Contracts Summary Cash Flow Diversification (1,2) • G&P assets s
Slide 20: MLP Industry Leading Sustainability Program
MLP Industry Leading Sustainability Program Crestwood’s commitment to MLP-industry leading sustainability initiatives is reflected in our year-over-year upgrades with key ESG rating agencies Sustainability Overview ESG Ratings Upgrades MSCI Scores Continue to • ESG Strategy: Continue to progress on
Slide 21: Commitment to Low Emission Operations
Crestwood’s Commitment to Low Emission Operations Hydrocarbons are forecasted to exceed 50% of total energy demand through 2040; Crestwood is committed to being a leader in ESG as it provides vital energy infrastructure and expands its footprint with Oasis Midstream Crestwood’s Climate Change Advanc
Slide 22: Commitment to ESG Performance Remains Strong
Commitment to ESG Performance Remains Strong Crestwood continues to lead midstream ESG efforts with a steadfast approach to sustainable operations and increased disclosures Began continuous methane emissions Named to the MSCI monitoring MSCI Score Bloomberg Added Score 2021 WHC pilot in upgraded to
Slide 23: Diversified Assets Provide Upside in Current Commodity Price Environment
C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Diversified Assets Provide Upside in Current Commodity Price Environment 23C Con onn ne ect ctiion ons s f for or Am Ame eri rica ca’’s s En Ene erg rgy y Diversified Assets Provide Upside in Current Commodity Price Envi
Slide 24: Gathering & Processing Segment
Gathering & Processing Segment Crude, natural gas and produced water wellhead gathering and natural gas processing assets across five shale basins leveraged to both crude and natural gas G&P Overview Cash Flow Forecast • Wellhead gathering systems and processing $500 infrastructure in the Bakken, Po
Slide 25: Bakken Overview
Bakken Overview Addition of Oasis Midstream assets expands Crestwood’s footprint to the west, adds substantial drilling inventory and increases processing capacity Bakken Overview Arrow Asset Map • Legacy Crestwood Gathering and processing assets located primarily on the Fort Berthold Indian Reserva
Slide 26: Bakken Operating Leverage: Increased Gas Capture and Reduced Flaring
Percent Volumes Flared Bakken Operating Leverage Increased Gas Capture and Reduced Flaring Drives Utilization Increased producer activity and optimization projects drive additional cash flow with minimal capital requirements Commentary • E&P and midstream collaborate to focus on increased gas captur
Slide 27: Powder River Basin Overview
Powder River Basin Overview Crestwood continues to have commercial success leveraging excess capacity at the Bucking Horse plant to attract new high-quality producer customers Powder River Basin Overview Powder River Basin Producers • Jackalope gathering system and Bucking Horse processing capacity
Slide 28: Delaware Basin Overview
Delaware Basin Overview Crestwood operates a fully integrated G&P system in the heart of the Delaware Basin (1) through 50/50 JV with First Reserve (CPJV) and JV with Shell Midstream Delaware Basin Overview Asset Map • Willow Lake system includes wellhead gas gathering system, 200 MMcf/d Orla cryo-p
Slide 29: Legacy Natural Gas Assets Provide Stable Cash Flow
Legacy Natural Gas Assets Provide Stable Cash Flow and Long-term Optionality Crestwood’s SW Marcellus and Barnett systems contribute predictable cash flows and offer potential upside in current natural gas price environment SW Marcellus System Map Barnett System Map EQT SWN EQT HG Energy SW Marcellu
Slide 30: Storage & Transportation and Marketing, Supply & Logistics Segments
Storage & Transportation and Marketing, Supply & Logistics Segments Storage assets provide stable cash flow contributions while NGL Logistics focuses on Marcellus/Utica producers, processors and fractionation through pipe, truck, rail, storage and terminals (2) Segment Overview* Cash Flow Forecast C
Slide 31: NGL Logistics Business
NGL Logistics Business Integrated infrastructure of NGL marketing, storage, terminal and transportation services across the Midwest and Northeast Key Highlights Asset Overview • Significant storage and terminal assets including 10 MMBbl of storage capacity (primarily Marcellus/Utica) and 13 trucking
Slide 32: COLT Hub Offers Takeaway Optionality
COLT Hub Offers Takeaway Optionality Existing and new crude pipeline interconnects on Arrow, trucking and the COLT Hub allow producers to fully operate under any potential scenario COLT Hub Arrow Crude Takeaway Outlets • Premier crude oil pipeline, storage and crude-by- rail facility in the Bakken •
Slide 33: Key Investor Highlights
Key Investor Highlights • Diversified midstream portfolio with critical infrastructure assets providing reliable services across the energy value chain • Balanced portfolio of high-quality customers supported by take- or-pay and fixed-fee contracts, with POP/POI upside • Strong track record of deliv
Slide 34: Appendix
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Slide 35: Stagecoach Divestiture Completed
Stagecoach Divestiture Completed Crestwood & Con Edison divest Stagecoach Gas Services to Kinder Morgan for $1.225 billion; transaction immediately achieves long-term leverage target of 3.5x – 3.75x Transaction Overview Transaction Merits • Proceeds of $1.225 billion split 50/50 Allows Crestwood to
Slide 36: Crestwood Enhances Governance with First Reserve Exit
Crestwood Enhances Governance with First Reserve Exit Crestwood and new investors acquired First Reserve’s common units and general partner interest, enabling Crestwood to transition into an independent public company with traditional governance, driving leading MLP governance and investor alignment
Slide 37: Federal Land Exposure Manageable Across Key G&P Assets
Federal Land Exposure Manageable Across Key G&P Assets; No impact to 2021 Outlook Crestwood’s producers have manageable exposure to federal lands with no impact to Bakken operations and extensive permits in PRB and Delaware Basin Bakken Powder River Basin Delaware Basin • CHK has minimal federal sur
Slide 38: Crestwood's 3-Year Sustainability Strategy
Crestwood’s 3-Year Sustainability Strategy Crestwood’s long-term sustainability strategy enhances transparency on management’s approach to identifying and mitigating key ESG risks • Continue to demonstrate our commitment to our Safety and Operating Principles • Deliver on our disciplined financial p
Slide 39: Crestwood's Industry Recognition
Crestwood’s Industry Recognition Crestwood continues to be recognized for its unwavering commitment to best in class customer service, employee engagement, environmental stewardship and diversity & inclusion Voted #3 by the buy-side and Top Workplaces in 2018, sell-side for Best Financially Ranked #
Slide 40: CEQP Non-GAAP Reconciliations
CEQP Non-GAAP Reconciliations CRESTWOOD EQUITY PARTNERS LP Reconciliation of Non-GAAP Financial Measures (in millions) (unaudited) (a) EBITDA is defined as income before income taxes, plus debt-related costs (interest and debt expense, net and loss on modification/extinguishment of debt) and depreci
Slide 41: CEQP Non-GAAP Reconciliations
CEQP Non-GAAP Reconciliations CRESTWOOD EQUITY PARTNERS LP (a) EBITDA is defined as income before income taxes, plus debt-related costs (interest and debt Reconciliation of Non-GAAP Financial Measures expense, net and loss on modification/extinguishment of debt) and depreciation, amortization (in mi
Slide 42: CEQP Non-GAAP Reconciliations: 2021 Guidance
CEQP Non-GAAP Reconciliations CRESTWOOD EQUITY PARTNERS LP Full Year 2021 Adjusted EBITDA, Distributable Cash Flow and Free Cash Flow Guidance Reconciliation of Non-GAAP Financial Measures (in millions) Expected 2021 Range (unaudited) Low - High Net Income (Loss) Reconciliation Net income (loss) $(2
Slide 43: CEQP Non-GAAP Reconciliations: Revised 2021 Guidance (Continued)
CEQP Non-GAAP Reconciliations CRESTWOOD EQUITY PARTNERS LP Revised Full Year 2021 Adjusted EBITDA, Distributable Cash Flow and Free Cash Flow Guidance (Continued) Reconciliation of Non-GAAP Financial Measures (in millions) (unaudited) (a) Includes gain (loss) on modification/extinguishment of debt,
Slide 44: • Big C closing slide 44• Big C closing slide
• Big C closing slide ™ ™ ™ ™ ™ ™ Connections for America’s Energy 44• Big C closing slide ™ ™ ™ ™ ™ ™ Connections for America’s Energy 44
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