Phillips 66 · NYSE:PSX
Phillips 66 — Investor Presentation (February 2021)
75 slides from Phillips 66's investor presentation, Feb 8, 2021
Slide 1: Investor Update February 2021
PHILLIPS 66) PROVIDING ENERGY. IMPROVING LIVES. mz Investor Update February 2021 cy Fourth Dock at Beaumont Terminal NEDERLAND, TX
Slide 2: Forward-looking statements
This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Words and phrases such
Slide 3: Company overview
3 As of December 31, 2019, with the exception of crude throughput capacity, which is as of January 1, 2021.
Slide 4: Asset map
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Slide 5: Freeport Marine Terminal
Freeport Marine Terminal FREEPORT, TX 5
Slide 6: Operating Excellence
a Operating Excellence Total Recordable Rates Refining Crude Capacity Utilization INCIDENTS PER 200,000 HOURS WORKED % 96% 95% 95% 93% 94% an: . 90% 91% 90% Phillips 66 CPChem DCP Midstream ° 76% 79% _m ; l | l | l | l [J [J 1.03 e ‘1 16 7 18 19 20 33 ° Phillips 66 = U.S. Industry Average 79 ‘@ e In
Slide 7: Response to COVID-19 Pandemic
| Response to COVID-19 Pandemic Contributed $5 MM in 2020 to COVID-19 relief efforts Reduced 2020 consolidated capital spending by >$700 MM Reduced costs by >$500 MM Leveraged AdvantEdge66 initiatives Suspended share repurchases Secured additional liquidity while maintaining investment grade credit
Slide 8: Long-Term Capital Allocation Framework
— Long-Term Capital Allocation Framework $6-7 B mid-cycle CFO Sources and Uses of Cash Sustaining capital for asset integrity, safety and environmental projects | -c_| Secure, competitive and growing dividend . Mid-Cycle Sust. Dividends Debt __h Strong balance sheet and investment grade CFO Capex Gr
Slide 9: Broad Sustainability View
| Broad Sustainability View SUPPORTS LONG-TERM RESILIENCE Operating Excellence is foundational to sustainability Energy transition initiatives being pursued Innovative research and development capabilities Emphasis on adaptability and flexibility Inclusion and diversity in our workforce unlocks valu
Slide 10: Innovation at Phillips 66
Innovation at Phillips 66 Advancing solid oxide fuel cells, organic photovoltaic polymers, batteries and renewable fuels Developing carbon mitigation, hydrogen and improved energy efficiency Supporting a sustainable energy future through deploying digital technology for data driven operations emphas
Slide 11: See appendix for footnotes
11 See appendix for footnotes
Slide 12: High-Performing Organization
— High-Performing Organization VISION 14,300 employees live our values, every day Providing Energy. Improving Lives. 98% retention of all employees, 98% retention of high performers 20% women and 27% U.S. minority CORE VALUES a 44% employees participate in employee resource groups Safety. Honor. Com
Slide 13: Midstream
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Midstream | 4 Beaumont it Terminal NEDERLANDS ?X
Slide 14: Midstream asset statistics
14 Fractionation capacity is as of December 31, 2020 and DCP Midstream net natural gas processing capacity as of September 30, 2020. All other data as of December 31, 2019. Statistics include assets owned by Phillips 66 Partners (PSXP). Crude oil terminals include rail racks.
Slide 15: Building a Premier Midstream Business
Building a Premier Midstream Business Top-quartile safety performance Diversified portfolio integrated with Refining and Marketing Integrated crude system with optionality for producers, refiners and exporters Advantaged USGC storage and export solutions Full NGL value chain through DCP and CPChem D
Slide 16: See appendix for footnotes
16 See appendix for footnotes
Slide 17: Phillips 66 Partners
— Phillips 66 Partners Primarily fee-based midstream assets backed by © Ss ‘Y long-term minimum volume commitments Nl Assets highly integrated with Phillips 66 system Backlog of MLP qualified projects at Phillips 66 e Charles Isomerization Unit WESTLAKE, LA. 17
Slide 18: DCP Midstream
18 DCP Midstream net natural gas processing capacity as of September 30, 2020. See appendix for additional footnotes.
Slide 19: Fractionation capacity
19 1) Fracs 1,2, and 3 have 400 MBD total capacity.
Slide 20: Chemicals
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Chemicals | ethylene Units Vig ILD OCEAN, TX
Slide 21: CPChem capacity and position
21 High density polyethylene (HDPE), Normal alpha olefins (NAO). Metrics shown net of JV capacity and sourced from IHS, Nexant, and company filings. See appendix for additional footnotes.
Slide 22: Chemicals Value Chain
| Chemicals Value Chain Ie cost Serve growing low-cost Siebel ethane ; feedstock middle class World-scale manufacturing in-demand facilities and products proprietary technology 70,000+ end-user products 22 PuLIPS
Slide 23: CPChem asset footprint
23 1) 50% proportional share to Phillips 66.
Slide 24: Polyethylene demand
24 Source: IHS; Polyethylene demand based on 2021 Edition: Fall 2020 Update. Low density polyethylene (LDPE), Linear-low density polyethylene (LLDPE)
Slide 25: Sustainability
a Sustainability Enhancing efforts to eliminate plastic pellet spills CPCHEM PLASTIC PELLET STATISTICS 2019 by joining Operation Clean Sweep Blue and ss . . . . . LE: THAN investing in Circulate Capital Ocean Fund .O2\:es RELEASED Continue to combat plastic waste and 7.515 j i BILLION LBS communicat
Slide 26: CPChem Circular Polyethylene
— CPChem Circular Polyethylene Difficult-to-recycle plastic Collection Announced first U.S. commercial-scale production of circular polyethylene from recycled mixed-waste plastics and received International Sustainability and Carbon Certification PLUS certification for its Cedar Bayou facility in No
Slide 27: CPChem Potential Growth Projects
a CPChem Potential Growth Projects U.S. Gulf Coast II CPChem 51% equity interest 2,000 kKMTA ethylene cracker Two 1,000 kMTA polyethylene units Ras Laffan Petrochemicals Project CPChem 30% equity interest 1,900 kMTA ethylene cracker Two polyethylene units; 1.680 KMTA combined capacity CPChem Researc
Slide 28: Refining
Refining | a wu 2 a s = e 5s « n a a = = = = > = os = co a wi 2 wu Ss = 2 > o a
Slide 29: Enhancing Refining Returns
— Enhancing Refining Returns Top-quartile HSE performance Adjusted EBITDA $B Strong cash generation across the cycle | 23) | Capital and cost discipline 16 7 18 19 20 High-return capital projects Capital Expenditures and Investments $B 11 1.0 0.9 0.8 0.8 16 7 18 19 20 mSustaining Return Advantaged f
Slide 30: Refining capacities
30 Capacities as of January 1, 2021. See appendix for additional footnotes.
Slide 31: Refining performance benchmarking
31 1) Based on Solomon Associates Report.
Slide 32: AdvantEdge66
a AdvantEdge66 BUSINESS TRANSFORMATION End-to-end value chain optimization Deploying digital technology to provide real-time information Leveraging advanced analytics to enable agile decision making Empowering our people to improve value generation Optimizing long-term value capture across the entir
Slide 33: Rodeo Renewed project
33 Information subject to permitting approvals. 1) 800 million gallons per year.
Slide 34: Renewable fuels transition
34 Information subject to permitting approvals.
Slide 35: Marketing & Specialties
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Marketing & Specialties
Slide 36: Marketing & Specialties financials
36 2019 capital expenditures includes $260 MM related to the investment in the West Coast Marketing joint venture.
Slide 37: Secure Product Placement
| Secure Product Placement United States ~5,350 sites reimaged since program inception All eligible sites are mobile enabled Direct consumer engagement Extend participation retail value chain Europe Proven low-cost, high-volume model Reimaging and high-grading the JET brand Adding new sites in Germa
Slide 38: Financial Strategy
Phillips 66 Hea HOUSTON, TX PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Financial Strategy
Slide 39: Financial Strategy
| Financial Strategy Disciplined capital allocation Strong investment grade credit rating Financial flexibility Secure, competitive and growing dividend Reduce debt as cash flow recovers Share repurchases at appropriate time a aevuienare HOUSTON, TX 39
Slide 40: Financial Strength
a Financial Strength Flexibility to execute strategy through the 42% cycle 30% 27% 20% 8 — _— _ Investment grade credit ratings 20% 2% 25% 25% PSX: A3 (Moody’s), BBB+ (S&P) 27.4 27.2 27.2 23.7 PSXP: Baa3 (Moody’s), BBB (S&P) - 15.9 Opportunity to efficiently reduce debt 101 10.1 2 - J $7.8 B total l
Slide 41: Debt maturities
41 Total debt includes capital leases, commercial paper and is net of unamortized discounts and debt issuance costs.
Slide 42: See appendix for footnotes
42 See appendix for footnotes
Slide 43: Capital spending
Sustaining Midstream Refining & PSXP Marketing 43 See appendix for footnotes
Slide 44: Dividend growth
44 Dividend CAGR calculated from initial dividend of $0.20 per share in 3Q 2012 to $0.90 per share in 4Q 2020.
Slide 45: Share price and peers
45 Share price as of December 31, 2020. See appendix for additional footnotes.
Slide 46: Phillips 66 Partners
Phillips 66) Partners Phillips 66 Partners Nillips 66) Partners
Slide 47: PSXP ownership
47 As of December 31, 2020. Public also owns 13.8 MM convertible preferred units.
Slide 48: PSXP asset base
48 Refineries owned by Phillips 66. See appendix for additional footnotes.
Slide 49: PSXP financial results
49 Adjusted EBITDA as shown is attributable to PSXP. Debt-to-EBITDA ratio is calculated on a credit facility covenant basis, which requires certain adjustments to total debt and EBITDA. Coverage ratio estimated on credit facility covenant basis. 20 coverage ratio represents full year 2020, and Debt-
Slide 50: Phillips 66 Partners
— Phillips 66 Partners Ensuring safe and reliable operations Adjusted Capital Spending $B Completing Organic Projects South Texas Gateway Terminal 0.9 0.8 07 C2G Pipeline -_ . 0.4 03 Backlog of MLP qualified projects : at Phillips 66 | _ 18 19 20 21B 7 mSustaining Growth Phillip: 66} | 50
Slide 51: EBITDA contribution
51 1) EBITDA contribution expected with start up of petrochemical facility in Gregory, TX
Slide 52: PSXP debt
52 Weighted average cost excludes revolving credit facility. Total debt is net of $31 MM unamortized discounts and debt issuance costs. At December 31, 2020, borrowings of $415 MM were outstanding and $1 MM in letters of credit had been drawn under our $750 MM revolving credit facility
Slide 53: PSXP unitholder return
53 Chart reflects total unitholder return from July 22, 2013, to December 31, 2020. Distributions assumed to be reinvested in units. PSXP compared against Alerian MLP Index (AMZ). Source: Bloomberg.
Slide 54: Beaumont Terminal
Beaumont Terminal NEDERLAND, TX.
Slide 55: Sensitivities
55 Sensitivities above are independent and are only valid within a limited price range.
Slide 56: Value Chain
| Value Chain Global Markets Crude Oil — Crude Pipelines, Product Pipelines, )) Marine, Shipping Refineries Terminals and and Rail Marine Petrochemicals Wellhead NGL and Natural Gas ioeli Fractionation LPG Export » Gathering and Pipelines and Storage and Marketing Liquids and Processing Natural Gas
Slide 57: 2021 Phillips 66 Outlook
2021 Phillips 66 Outlook 1Q 2021 Global Olefins & Polyolefins utilization Refining crude utilization Refining turnaround expenses (pre-tax) Corporate & Other costs (pre-tax) 2021 Refining turnaround expenses (pre-tax) Corporate & Other costs (pre-tax) Depreciation and amortization Effective income t
Slide 58: General information and conventions
General Information disclosed is as of December 31, 2020, unless noted otherwise. Numbers may not appear to tie due to rounding. Chevron Phillips Chemical may be abbreviated as CPChem. Marketing and Specialties may be abbreviated as M&S. Date Conventions 20 is as of December 31, 2020, or the twelve-
Slide 59: Maps
Maps Maps, images and drawings are for informational purposes only and may not be to scale. 59
Slide 60: Footnotes
Slide 6 Industry averages are from: Phillips 66 – American Fuel & Petrochemical Manufacturers (AFPM) refining data, Chevron Phillips Chemical LLC (CPChem) – American Fuel & Petrochemical Manufacturers (AFPM) chemicals data, DCP Midstream, LLC (DCP Midstream) – Gas Processors Association (GPA). 2020
Slide 61: Footnotes
Slide 11 The “Total Enhancements” amount represents estimated EBITDA uplift versus a baseline year of 2017. The “Mid-Cycle EBITDA Uplift” amount represents estimated actual mid-cycle EBITDA uplift after consideration for inflation and market movements in a mid-cycle environment through 2019. Slides
Slide 62: Reconciliation of Consolidated Earnings to Adjusted Earnings
Millions of Dollars Except as Indicated 2016 2017 2018 2019 2020 Reconciliation of Consolidated Earnings (Loss) to Adjusted Earnings (Loss) Consolidated Earnings (Loss) $ 1,555 5,106 5,595 3,076 (3,975) Pre-tax adjustments: Pending claims and settlements (117) (60) 21 (21) (37) Pension settlement ex
Slide 63: Reconciliation of Net Income to Adjusted EBITDA
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Phillips 66 Net Income (Loss) to Adjusted EBITDA Phillips 66 net income (loss) $ 4,131 3,743 4,797 4,280 1,644 5,248 5,873 3,377 (3,714) Less: Income from discontinued operations 48 61 706 — — — — — — Plus: Income tax
Slide 64: Midstream Adjusted EBITDA Reconciliation
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Midstream Pre-Tax Income (Loss) to Adjusted EBITDA Midstream pre-tax income (loss) $ 88 750 851 147 402 638 1,181 684 (9) Plus: Interest revenue — — — — — (1) — — — Depreciation and amortization 83 88 91 127 215 299 3
Slide 65: Chemicals Adjusted EBITDA Reconciliation
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Chemicals Pre-Tax Income to Adjusted EBITDA Chemicals pre-tax income $ 1,189 1,361 1,632 1,315 839 716 1,025 879 635 Plus: None — — — — — — — — — Chemicals EBITDA 1,189 1,361 1,632 1,315 839 716 1,025 879 635 Special
Slide 66: Refining Adjusted EBITDA Reconciliation
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Refining Pre-Tax Income (Loss) to Adjusted EBITDA Refining pre-tax income (loss) $ 5,089 2,782 2,467 3,659 436 2,076 4,535 1,986 (6,155) Plus: Depreciation and amortization 655 685 704 738 769 821 840 854 879 Refining
Slide 67: Marketing & Specialties Adjusted EBITDA Reconciliation
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Marketing & Specialties Pre-Tax Income to Adjusted EBITDA Marketing and Specialties pre-tax income $ 863 1,327 1,475 1,652 1,261 1,020 1,557 1,433 1,446 Plus: Interest revenue — — — (2) — — — — — Depreciation and amor
Slide 68: Corporate & Other Adjusted EBITDA Reconciliation
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reconciliation of Corporate & Other Pre-Tax Loss to Adjusted EBITDA Corporate and Other pre-tax loss $ (673) (694) (680) (729) (747) (895) (853) (804) (881) Plus: Net interest expense 231 258 246 285 321 408 459 415 485 Depreciation an
Slide 69: DCP Midstream Adjusted EBITDA Reconciliation
Millions of Dollars 2016 2017 2018 2019 2020 Reconciliation of DCP Midstream Pre-Tax Income (Loss) to Adjusted EBITDA DCP Midstream pre-tax income (loss) $ (34) 76 106 (784) (958) Plus: None — — — — — DCP Midstream EBITDA (34) 76 106 (784) (958) Special Item Adjustments (pre-tax): Pending claims and
Slide 70: Phillips 66 Partners Adjusted EBITDA and DCF to Net Income
Millions of Dollars 2016 2017 2018 2019 2020 Phillips 66 Partners Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Income Net income attributable to the Partnership $ 301 461 796 923 791 Plus: Net income attributable to Predecessors 107 63 — — — Net income attributable to noncont
Slide 71: Phillips 66 Partners Adjusted EBITDA and DCF to Operating Cash
Millions of Dollars 2016 2017 2018 2019 2020 Phillips 66 Partners Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Cash Provided by Operating Activities Net cash provided by operating activities* $ 492 724 892 1,016 955 Plus: Net interest expense 52 99 114 105 120 Income tax expe
Slide 72: Phillips 66 Capital Expenditures and Investments
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Phillips 66 Capital Expenditures and Investments Midstream Growth $ 548 429 2,021 2,801 1,267 597 1,360 1,605 1,470 Sustaining 159 168 152 1,656 186 174 188 264 216 Total 707 597 2,173 4,457 1,453 771 1,548 1,869 1,686 Refining Growth
Slide 73: Partners and Affiliates Capital Expenditures
Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 Proportional Share of Select Equity Affiliates Capital Expenditures and Investments* DCP Midstream (Midstream) $ 1,324 971 776 438 99 268 484 472 119 CPChem (Chemicals) Growth 239 403 726 1,136 743 571 131 155 104 Sustaining 132 210 16
Slide 74: Total Debt
Millions of Dollars Except as Indicated Debt-to-Capital Debt-to-Capital Ratio Total Debt Total Equity Ratio December 31, 2020 Phillips 66 Consolidated $ 15,893 21,523 42 % PSXP* 3,909 2,512 Phillips 66 Excluding PSXP $ 11,984 19,011 39 % December 31, 2019 Phillips 66 Consolidated $ 11,763 27,169 30
Slide 75: Phillips 66 ROCE Numerator
Millions of Dollars (Except as Indicated) 2016 2017 2018 2019 2020 Phillips 66 ROCE Numerator Net income (loss) $ 1,644 5,248 5,873 3,377 (3,714) After-tax interest expense 220 285 398 362 394 GAAP ROCE earnings (loss) 1,864 5,533 6,271 3,739 (3,320) Special items (57) (2,837) (51) 581 3,598 Adjuste