Enterprise Products Partners L.p. · NYSE:EPD
Enterprise Products Partners L.p — RBC Dain Rauscher Luncheon Meeting (May 2005)
35 slides from Enterprise Products Partners L.p's conference presentation, May 4, 2005
Slide 1: Enterprise Products Partners L.P. RBC Dain Rauscher Luncheon Meeting
Enterprise Products Partners L.P. RBC Dain Rauscher Luncheon Meeting May 4, 2005 Robert G. Phillips President & CEO
Slide 2: Forward looking statements
Forward looking statements This presentation contains forward-looking statements and information that are based on Enterprise’s beliefs and those of its general partner, as well as assumptions made by and information currently available to them. When used in this presentation, words such as “anticip
Slide 3: Forward looking statements (cont.)
Forward looking statements (cont.) Fluctuations in oil, natural gas and NGL prices; A reduction in demand for its products by the petrochemical, refining or heating industries; A decline in the volumes of NGLs delivered by its facilities; The failure of its credit risk management efforts to adequate
Slide 4: Overview
Overview The largest publicly traded energy partnership (based on market capitalization) serving producers and consumers of natural gas, NGLs and crude oil Equity market capitalization of $10 Billion Enterprise value of $14 Billion Ranked 260th on Fortune 500 Only integrated North American midstream
Slide 5: Partnership Profile
Partnership Profile Leading provider of midstream energy services with strong position in prolific deepwater Gulf of Mexico and Rocky Mountains Leading provider of feedstock to petrochemical and refinery markets Diversified and complementary businesses provide a natural hedge to mitigate effects of
Slide 6: Integrated Midstream Energy Services
Integrated Midstream Energy Services Fees are earned at each link of value chain
Slide 7: Leading Business Positions Across Midstream Energy Value Chain
Leading Business Positions Across Midstream Energy Value Chain
Slide 8: Strategically Located Assets
Strategically Located Assets
Slide 9: Diversified Business Mix
Diversified Business Mix Gross Operating Margin by Segment (Six Months Since Merger) NGL Pipelines & Services (54%) Natural gas processing plants & related marketing activities NGL fractionation plants NGL pipelines and storage Onshore Natural Gas Pipelines & Services (27%) Natural gas pipelines Nat
Slide 10: $2 Billion of Growth Opportunities
$2 Billion of Growth Opportunities
Slide 11: MAPL and Seminole NGL Pipelines
MAPL and Seminole NGL Pipelines Mid-America Pipeline (MAPL) 7,226 miles of 16” to 6” pipelines 16 propane terminals, 4 MMBbls storage 1Q05 throughput - 642 MBPD Seminole Pipeline (SPL) 1,281 miles of 16” to 4” pipelines 1Q05 throughput - 248 MBPD FERC Activity Objective in 2005 is to seek relief thr
Slide 12: San Juan Basin
San Juan Basin 6,000 mile gathering system 9,500 wells connected 1,205 Bbtus/d 1Q05 volume 250 new well connects per year Chaco Processing Plant 650 MMcf/d capacity 40-42,000 Bpd NGL’s Feeds MAPL/Seminole system System Optimization Plan $43 MM capital project Increase capacity by 130 MMcf/d On track
Slide 13: Texas Pipeline System
Texas Pipeline System 8,222 mile gathering and transportation system with 6.4 Bcf storage 3,283 Bbtus/d 1Q05 volume Connected to major supply basins North Texas (Barnett Shale) East Texas (Bossier) South Texas (Wilcox, Vicksburg) Permian Basin Connected to all major Texas Markets San Antonio, Austin
Slide 14: Texas Processing and NGL System
Texas Processing and NGL System Plants / Treaters / Fractionators 10 processing plants 2 treating plants 3 fractionation plants 1,039 mile NGL pipeline system Current volumes 1,420 Mdth/d inlet processing 80,000 Bpd NGL’s produced 73,000 Bpd NGL’s fractionated Value chain strategy provides competiti
Slide 15: Eastern Gulf Coast Processing and NGL System
Eastern Gulf Coast Processing and NGL System Processing Interests in 11 processing plants Gross processing capacity 11.9 Bcf/d (3.5 Bcf/d net) 6,000 Mdth/d inlet processing 190,000 Bpd NGL’s produced Fractionation Interests in 5 fractionators Gross fractionation capacity 346 Mbpd (185 Mbpd net) Full
Slide 16: Gulf of Mexico Assets
Gulf of Mexico Assets Cameran Highvey Independence 35a rail SS ategreny By renceree ‘Alleghen: * wn sgheny Hub {Dou rocusne ret [tenon | S = De Rene cae ss es as Pipeline funder constuction) |p + it Pipeline ander construction) ©All nights reserved. Enterprise Products Partners L.P.
Slide 17: Marco Polo Platform and Pipelines
Marco Polo Platform and Pipelines Tension leg platform in 4,300 feet located in prolific South Green Canyon area of Deepwater Trend 50/50 joint venture with Cal Dive and operated by Anadarko Demand charges began April 2004 and first production July 2004 Marco Polo platform design capacity 120,000 BO
Slide 18: Cameron Highway Oil Pipeline
Cameron Highway Oil Pipeline 50/50 partner with Valero and operated by Enterprise Largest offshore oil pipeline system 390 miles 3 platforms 600,000 BOPD Anchor fields and area reserves more than 1+ billion barrels Pipeline in-service February 2005 Current volumes 100,000 BOPD Received first product
Slide 19: Independence Trail
ndependence Trail loses knoll tres ~ es | Transco MP 2t ce Sta |_ Breton Sound trea deterharh ©All rights reserved. Enterprise Products Partners L.P. 19
Slide 20: Independence Hub and Trail Project
Independence Hub and Trail Project EPD will design, construct, install and own a semi-submersible production platform Located on Mississippi Canyon block 920; chosen for favorable seafloor conditions and proximity to anchor fields Capable of processing 850 MMcf/d of natural gas EPD will build, own a
Slide 21: Independence Hub Project
Independence Hub Project San Jacinto DC g18/619 Spiderman Dc e202 Atlas NW LR5 ‘Atlas ye LR 4960 Merganser Vortex Mondo NW Pie AnchorFiela AV 3637 AV 2177261 LR 177224 Se Recent Tie-back Discovery Cheyenne Jubilee LR39 tk Potential Tie-Back AV 305/349 LR 266309 ©All rights reserved. Enterprise Produ
Slide 22: Midstream Business Summary
Midstream Business Summary Diversified assets performing well across the value chain due to strong fundamentals Increased fee-based businesses improves business mix and performance Natural hedge to changes in gas prices creates cash flow stability in portfolio Long term growth through disciplined hi
Slide 23: Financial Overview
Financial Overview ©All rights reserved, Enterprise Products Partners LP.
Slide 24: Financial Objectives
Financial Objectives Increase cash flows from fee-based businesses Prudently invest to expand the partnership through organic growth, acquisitions and joint ventures with strategic partners Manage capital to provide financial flexibility for partnership while providing our investors with an attracti
Slide 25: Unique Ownership Structure
Unique Ownership Structure Largest % ownership by Management in energy industry Management interest aligned with those of limited partners and supported by unit purchases Approx. $382 million of new EPD units since October 2002 Acquired remaining 9.9% of EPD GP and 13.5 million EPD units from El Pas
Slide 26: MLP Math: 25% vs. 50% GP Splits
MLP Math: 25% vs. 50% GP Splits Lower Splits = Lower Cost of Capital Savings in Distributions Paid to GP with 25% Splits GP’s Share of Distribution Increases
Slide 27: First Quarter Results
First Quarter Results (Sin millions) First Quarter ‘Year Ending Dec. 31 2004 2005" 2003 2004 ° Gross Operating Margin By Segment: NGL Fipelines & Services $90 $153, $311 $34 Onshore Natural Gas Pipelines & Services 6 80 18 91 Offshore Pipelines & Serices 1 23 5 36 Petrochemical Services 24 19 16 122
Slide 28: Solid Capitalization
Solid Capitalization Avg. life of debt - 12.2 years Avg. interest rate - 5.6% Effective 70% fixed rate debt, after SWAPS
Slide 29: EPD Meets S&P Criteria
EPD Meets S&P 500 Criteria (1) Public Float > 50% U.S. Based Operating Company
Slide 30: Proven Growth, Superior Returns
Proven Growth, Superior Returns
Slide 31: Key Investment Considerations
Key Investment Considerations Strategically located assets serving the most prolific supply basins for natural gas, natural gas liquids (NGLs) and crude oil in the U.S. Leading business positions across midstream sector Greater cash flow stability from diversified fee-based assets following the rece
Slide 32: Questions and Answers
Enterprise Products Partners L.P. Questions and Answers
Slide 33: Non-GAAP Reconciliations
Non-GAAP Reconciliations First Quarter irnitins) 2004 __ 2005 GAAP operating income $89 $165 ABjustments fo reconcile GAAP operating income fo Non-GAAP ‘otal gross operating margin. Depeciationand anorization inoperatirg costs and expences $31 $100 Operatire lease expense taid b vEPCO in orerating c
Slide 34: Non-GAAP Reconciliations
Non-GAAP Reconciliations For the Three Menthe Ended March 2, inition) 2005 2004 Exowilaton of Nim GAA? "22ITD." 19 GAAP "Nia Bvowe and GAAP "Cash rowed cetvites" Na income 5 ws cs _Adations w net income to derive EBITDA: Ihewest expense (chdingrelited amortization) 3 3 Proven fortaee 2 1 Depreciain
Slide 35: Non-GAAP Reconciliations
Non-GAAP Reconciliations Bi nition) 2002 00a" Bevkcome * mF 8 Agusentsto devine BATDA humstepase 8 mos 6 Prov inforincometae 5 4 Deprecitim and martini (oclutng mortintim compara in ep.) us ws IrDA 366 oy humstepase ony 056) Prové informatie o a multe effect of canes accouringpecpsl ay [Bquty ibs (a
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