Kinder Morgan, Inc. · NYSE:KMI
Kinder Morgan — Kinder Morgan Energy Partners — Lehman Brothers 2006 CEO Energy/Power Conference
23 slides from Kinder Morgan's conference presentation, Sep 6, 2006
Slide 1: Company Run By Shareholders, For Shareholders
ENERGY PARTNERS, L.P. Company Run By Shareholders, For Shareholders September 6, 2006
Slide 2: Forward Looking Statements
ENERGY PARTNERS, L.P. Forward Looking Statements This presentation contains forward looking statements, including these, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward looking statements are not guarantees
Slide 3: Kinder Morgan KMP Asset Map
ENERGY PARTNERS, L.P. KinderSystem KMP MorganMap Assets PRODUCTS PIPELINES (KMP) PRODUCTS PIPELINES TERMINALS (KMP) 2 Pacific TRANSMIX FACILITIES (KMP) Cochin NATURAL GAS PIPELINES (KMP) 2 NATURAL GAS STORAGE Trailblazer (KMP) 3 North 2 NATURAL GAS PROCESSING 2 (KMP) Northern 2 CO2 PIPELINES (KMP) T
Slide 4: Kinder Morgan Structure
ENERGY PARTNERS, L.P. Kinder Morgan Structure Kinder Morgan Energy Partners (a) Market Equity $10.1 Debt 5.5 Enterprise Value $15.6B 2006E EBITDA $1,802mm (b) 2006E Dist. CF $1,290mm (b) Additional Cash Incentive Shares Distribution Distribution KMR KMP (LLC) (Partnership) 61 million i-units (a) 168
Slide 5: Solid Asset Base Generates Stable Fee Income
ENERGY PARTNERS, L.P. Solid Asset Base Generates Stable Fee Income CO2 Products Pipelines 2006 DCF (a) 30% CO2 transport and sales Refinery hub to population 70% oil production related center strategy Expected production hedged (b): 68% Pipelines Products 2007=96% CO2 27% Associated Terminals (c) Pi
Slide 6: Consistent Track Record
ENERGY PARTNERS, L.P. Consistent Track Record Total Distributions (GP + LP) ($mm) KMP Distribution Per Unit (c) $1,400 $1,281 $4.00 GP (a) $1,162 $3.24-$3.36 $1,200 $3.20 8% $2.96 LP $978 $3.00 =1 $1,000 54% GR $2.72 = $827 CA $2.50 $800 AGR $701 $2.20 C $2.00 $1.90 $600 $548 $1.45 $1.13 $1.30 $400
Slide 7: Attractive Historical Returns
ENERGY PARTNERS, L.P. Attractive Historical Returns Total Returns, Dec-31-96 to Aug-31-06 (a) 1,400 1,300 KMP has returned 1136% since KMP 30% annual return 1,200 12/31/96, compared to 369% and 105% 1,100 for the MLP comparable composite 1,000 and S&P 500 index, respectively. Indexed Total Return (%
Slide 8: The Kinder Morgan Strategy
ENERGY PARTNERS, L.P. The Kinder Morgan Strategy Same Strategy Since Inception Focus on stable, fee-based assets which are core to the energy infrastructure of growing markets Increase utilization of assets while controlling costs Classic fixed cost businesses with little variable costs Improve
Slide 9: Vision: Where We're Going
ENERGY PARTNERS, L.P. Vision: Where We’re Going Trend KM Opportunity Growing Rockies Natural Gas Production Rockies Express Increased Supply of LNG on Gulf Coast Kinder Morgan Louisiana Pipeline Canadian Oilsands Edmonton terminal Increased Use of Heavy Crude Petcoke handling – Gulf Coast, Canada Gr
Slide 10: Growing Rocky Mountain Natural Gas Production: Rockies Express Pipeline
ENERGY PARTNERS, L.P. Growing Rocky Mountain Natural Gas Production: Rockies Express Pipeline 10 10
Slide 11: Increased LNG Supply on Gulf Coast
ENERGY PARTNERS, L.P. Increased LNG Supply on Gulf Coast Gulf Coast LNG Projects Under Construction ") ! ") ") Henry Katy ") )" ") ") & - ~8-11 Bcf/d of terminal & -") # * ! ! ") kj capacity under ") ExxonMobil – Golden Pass # * 2008-09 Sempra – Cameron LNG 1-2") Bcf/d, projected in-svc ! 1.5-2.65!
Slide 12: Increased LNG Supply on Gulf Coast: Kinder Morgan Louisiana Pipeline
ENERGY PARTNERS, L.P. Increased LNG Supply on Gulf Coast: Kinder Morgan Louisiana Pipeline Provides key link Texas Louisiana CGT Delivery Point between Sabine 340 Pass Transco Delivery Point ( ( LNG Terminal to TETCO Delivery Point ( ANR Delivery Point ( ( interstate pipeline grid ( ( Texas Gas Deli
Slide 13: Canadian Oilsands: Supply
ENERGY PARTNERS, L.P. Canadian Oilsands: Supply Canadian Crude Production by Type (a) World Oil & Bitumen Reserves – Top 10 (b) (MBbl/d) (reserves (billions of barrels) 4,000 Oilsands 350 345 315 Pentanes/Condensate 300 5 3,500 ‘05-‘1 270 Bitumen Conventional Heavy AGR 3,000 Conventional Light/Med s
Slide 14: Canadian Oilsands: PADDs II and IV Have the Most Access to Canada
ENERGY PARTNERS, L.P. Canadian Oilsands: PADDs II and IV Have the Most Access to Canada Major Canadian Oilsands Takeaway into the U.S. Bb R ) Trunkline 0 M IDO l/d AIN Fort McMurray NT (22 RR U MO l/d) Cold Lake (MMBbl/d) Capacity CO NS MBb A TR (225 Edmonton in to U.S. Hardisty PADD II 2.0 - BOWRIV
Slide 15: Canadian Oilsands: U.S. a Significant Importer of Crude
ENERGY PARTNERS, L.P. Canadian Oilsands: U.S. a Significant Importer of Crude Alaskan North Slope Production Declining (a) Washington State Refinery Capacity (c) 2,000 Canadian crude through ANS Crude Oil Production 1,500 Trans Mountain 15% (92 MBbl/d) (MBbl/d) 1,000 Other 500 85% (521 MBbl/d) 0 198
Slide 16: Canadian Oilsands: Trans Mountain Expansion
ENERGY PARTNERS, L.P. Canadian Oilsands: Trans Mountain Expansion TMX1 – C$595 million additional 75 MBbl/d Pump Station Expansion, C$230 million, 35 MBbl/d, in-svc by April 2007 Anchor Loop, C$365 million, 40 1,100 MBbl/d MBbl/d, in-svc at end of 2008 TMX2 – Loop between Valemont & Kamloops and
Slide 17: Identified Future Growth Opportunities
ENERGY PARTNERS, L.P. Identified Future Growth Opportunities Nearly $5 billion in identified growth opportunities over next 5 years Estimated Total Project Expected Entity Project Cost ($B) Completion KMP Louisiana Pipeline (LNG) $0.5 2009 KMP Rockies Express 2.2 (a) 2007-2009 KMP CO2 1.1 2007-2010
Slide 18: Over $10 Billion in Capital Invested at KMP
ENERGY PARTNERS, L.P. Over $10 Billion in Capital Invested at KMP ($ billions) Total Invested by Type $8.0 Total Invested by Year $6.0 $2.0 $1.9 Expansion $4.0 Acquisition $7.6 $1.6 $1.6 $2.0 $1.3 $1.3 $3.1 $1.2 $1.1 $1.1 $0.0 $1.0 $0.9 Acquisitions Expansions $0.8 Total Invested by Segment $0.5 $4.
Slide 19: Attractive Return on Capital
ENERGY PARTNERS, L.P. Attractive Return on Capital Return on Investment (a): 2000 2001 2002 2003 2004 2005 Products Pipelines 11.9% 11.8% 12.8% 12.9% 12.4% 11.3% Natural Gas Pipelines 13.3 15.5 12.9 13.5 14.0 15.5 CO2 27.5 24.6 22.0 21.9 23.8 25.7 Terminals 19.1 18.2 17.7 18.4 17.8 16.9 KMP Return o
Slide 20: KMP is Conservatively Capitalized
ENERGY PARTNERS, L.P. KMP is Conservatively Capitalized ($ millions) Credit Summary KMP L-T Debt Rating Baa1/BBB+ Net Debt / Total Capital (a,b,c) 52.7% 2006 Budget Estimates: Debt / EBITDA 3.1x EBITDA / Interest 5.6x CP Capacity (c) Long-term Debt Maturities (c) KMP KMP Total Bank Credit $1,850 (d)
Slide 21: Risks
ENERGY PARTNERS, L.P. Risks Regulatory Pacific Products Pipeline FERC/CPUC case Periodic rate reviews Unexpected FERC policy changes Oil Production Volumes Environmental Terrorism Interest Rates Approximately 50% of debt is floating rate Budget assumes an increase based on the forward curv
Slide 22: Summary
ENERGY PARTNERS, L.P. Summary Stable Cash Flow Own assets core to energy infrastructure Internal Growth Opportunities Critical Mass Well-located assets/favorable demographics KMP/KMR: Fixed Cost Business 7.0-7.5% Yield Drop growth to bottom line and Unique Structure 8% Long-Term Tax Effici
Slide 23: Kinder Morgan
KINDER’ MORGAN
Kinder Morgan Energy Partners — Lehman Brothers 2006 CEO Energy/Power Conference on 6ix