Altagas Ltd. · TSX:ALA
Altagas — Investor Presentation (September 2018)
36 slides from Altagas's investor presentation, September 2018
Slide 1: Investor Presentation September 2018
Investor Presentation September 2018
Slide 2: Forward-looking Information
Forward-looking Information This presentation contains forward-looking statements. When used in this presentation, the words “will”, “intend”, “plan”, ”potential”, “generate”, "grow", “deliver”, “can”, “continue”, “drive”, “anticipate”, “target”, “come”, “create”, “position”, “achieve”, “seek”, “pro
Slide 3: A Leading Energy Infrastructure Company
A Leading Energy Infrastructure Company Highly contracted assets providing long-term stable cash flow US Utilities Rate base of over $4 Over 3 Bcf/d billion of natural gas Serving over transacted in two 1.5 million of North America’s customers Power most prolific gas generation in plays – the +20 st
Slide 4: Driving Business Forward
Driving Business Forward Today Asset monetization and funding plan WGL acquisition closed July 2018 Gas Midstream gas development rapidly expanding Additional opportunities identified at WGL Going forward we are focused on: WGL acquisition announced Drive performance Drive returns AltaGas standa
Slide 5: Stability, Sustainability and Growth
Stability, Sustainability and Growth ~80% of EBITDA backed by medium- and long-term agreements Highly contracted Regulated Highly contracted Gas + Utilities + Power High-quality cash flows underpinned by long-term take-or-pay contracts and rate regulated franchises See "forward-looking statements &
Slide 6: Reshaping AltaGas
Reshaping AltaGas Gas U.S. Utilities Power Providing producers with Strong growth markets with Using our clean energy solutions, including global increasing construction to Power expertise and creativity to market access off of both support customer additions, shape an innovative power coasts of Nor
Slide 7: Reshaping to Focus on Gas and U.S. Utilities
Reshaping to Focus on Gas and U.S. Utilities U.S. Gas U.S. Utilities Utilities Gas 25% - 30% CDN EBITDA Growth Utilities Power CDN Power Utilities 2017 EBITDA 2018 EBITDA 2018 Capital Spending U.S. Gas Power Utilities 40-45% 5-15% 45-50% 2019 EBITDA Breakdown U.S. Gas Power Utilities 38% 18% 44% See
Slide 8: Business Transforms with Close of WGL and Asset Monetization Plan
Business Transforms with Close of WGL and Asset Monetization Plan
Slide 9: Sale of Interest in Northwest Hydro Facilities
Sale of Interest in Northwest Hydro Facilities Sale Aligned with Asset Monetization and Funding Strategy for the Acquisition of WGL Sold 35% of Northwest Hydro Facilities for $922 million, implying a 2017 EBITDA multiple of ~27 times and a total value of $2.6 billion on a 100% basis Sale closed
Slide 10: Sale of Non-Core Midstream and Power Assets
Sale of Non-Core Midstream and Power Assets • Continuing to execute on strategy to reshape the company with a focus on Gas and U.S. Utilities opportunities • $560 million total proceeds, used to repay significant portion of bridge facility Non-core Canadian midstream assets Non-core power assets S
Slide 11: AltaGas Creates AltaGas Canada Inc.
AltaGas Creates AltaGas Canada Inc. Boldly reshaping the company with a focus on Gas and U.S. Utilities Committed to having assets in all three segments, with a focus on a capital light, low-carbon presence in Power AltaGas expects to hold between ~37% to 45% of ACI at close of the Initial Public
Slide 12: Term Debt and Hybrid Securities to Complete Repayment of Bridge Facility
Term Debt and Hybrid Securities to Complete Repayment of Bridge Facility Bridge Facility Repayment (US$bn) ~US$7.3 ~US$2.5 ~US$1.8 ~US$0.7 ~US$0.4 ~US$0.8 ~US$2.3 ~US$1.1 Total transaction Assumed debt Subscription NWH Minority Bridge Loan Non-Core ACI IPO Term Debt and value1 receipts 2, 3 Interest
Slide 13: Long-term Value Creation with Strong Balance Sheet are Governing Principles
Long-term Value Creation with Strong Balance Sheet are Governing Principles
Slide 14: Governing Financial Principles
Governing Financial Principles Delivering security and value Principles Targets 50 - 60% FFO1 payout ratio 1 Dividend Sustainability Over ~65% of 2019 common dividends to be underpinned by Regulated Utilities Enhancing returns on existing assets 2 Target Expected Returns Specified targets fo
Slide 15: Balance Deleveraging, Dividend Sustainability and Funding
Balance Deleveraging, Dividend Sustainability and Funding Improve credit Focus on stable Credit Metric Long-Term metrics as Target cash flows funding strategy FFO1/ Debt ~ 15% is completed Net Debt / EBITDA ~ 5.0x Committed to Target FFO payout ratio $1.98 $2.10 $2.19 sustainable of 50% – 60%, $
Slide 16: Wealth of Opportunities Across Gas and U.S. Utilities
Wealth of Opportunities Across Gas and U.S. Utilities Gas segment drives High Quality U.S. Utility Growth significant near term growth RIPET Central Mountain ~US$1.5 + Additional Penn Valley Pipeline billion projects over 5 years supports to support $450 – new customer growth markets additions, gene
Slide 17: High-Quality Utility Assets with Significant Embedded Organic Growth
High-Quality Utility Assets with Significant Embedded Organic Growth Rate Applications Robust Growth Opportunities Washington, DC Operates in higher growth markets with significant capital expenditures to support new customer Next rate case to be filed in 2020 additions, general system improvement
Slide 18: America’s Two Most Prolific Gas Plays
Positioned to Actively Participate in North America’s Two Most Prolific Gas Plays Strategic infrastructure provides producers with global market access off to both coasts of North America Montney Marcellus/Utica Macro factors give us confidence in growth opportunities: Pipeline development conne
Slide 19: Successful track record of delivering EBITDA growth over time
Successful track record of delivering EBITDA1 growth over time Significant growth in 2018 driven by WGL Acquisition Gas Growth Opportunities Come Online $ Millions RIPET 1,000 Townsend Expansion 25% – 30% growth2 Mountain Valley Central Penn 800 Addition of a full 600 year of WGL 400 Success
Slide 20: AltaGas
AltaGas
Slide 21: Gas
AltaGas
Slide 22: Building Infrastructure to Serve New Markets
Building Infrastructure to Serve New Markets From wellhead to markets Fully-integrated, customer-focused value chain provides increased value to producers Fully-integrated, customer-focused value chain provides increased value to producers 1 Current supply for Ferndale is sourced through Petrogas. 2
Slide 23: Midstream Operations in North America’s Most Prolific Gas Plays
Midstream Operations in North America’s Most Prolific Gas Plays Strategic infrastructure provides producers with global market access Unique opportunity providing critical infrastructure for energy exports at three sites on both the Pacific and Montney expected to Atlantic grow from ~4.5 Bcf/d in 20
Slide 24: AltaGas’ Northeast B.C. and Energy Export Strategy
AltaGas’ Northeast B.C. and Energy Export Strategy Provides NEW market access for Western Canadian propane producers to Asia AltaGas’ propane export terminal at Ridley Island is poised to create a hub for key global markets to the west Significant shipping advantages vs. Gulf coast, providing pr
Slide 25: Northeast B.C. Strategy
Northeast B.C. Strategy Provides new market access for Western Canadian propane producers to Asia Expected to be Canada’s first Truck propane export terminal, located Blair Creek Terminal Ridley Island Propane on B.C’s west coast Raw gas Export Terminal (RIPET) Will provide producers with access
Slide 26: Expanding the Townsend Gas Processing Complex
Expanding the Townsend Gas Processing Complex Expansion of the Townsend Complex and capture area coupled with enhanced NGL recovery will provide producers with more options for energy exports Townsend Expansion Addition of a 198 MMcf/d of C3+ deep cut gas processing capacity Kelt with firm proce
Slide 27: Black Swan Aitken Creek Processing Facilities
Black Swan Aitken Creek Processing Facilities 50% in interest in Black Swan Gas Plants strengthens Northeast B.C. integrated gas strategy and propane export solution Black Swan Agreement: Energy exports - 15 year NGL dedication to North Pine 50% interest in 210 MMcf/d Black Swan Aitken Creek Pro
Slide 28: Ridley Island Propane Export Terminal
Ridley Island Propane Export Terminal First mover competitive advantage Expected to be Canada’s first West Coast propane export terminal Construction is underway and is expected to be in service by Q1 2019 Facility designed for 40,000 bbls/d of export capacity Brownfield site includes existing
Slide 29: AltaGas’ Position in the Marcellus
AltaGas’ Position in the Marcellus Connecting low cost producers with U.S. consumption markets and exports ME VT NH NH NY Stonewall Currently in service MI US$135 Million1 Designed to gather 1.4 Bcf/d from MA ALA 30% ownership West Virginia CT RI RI PA Designed to transport 1.7 Bcf/d as Centra
Slide 30: Utilities
Utilities AltaGas
Slide 31: U.S. Utility Business
U.S. Utility Business High quality assets underpinned by regulated, low-risk cash flow Delivering clean and affordable natural gas to homes and businesses in multiple jurisdictions Increased diversification, across several high growth areas, minimizing exposure to any one jurisdiction Over $4 Bi
Slide 32: Michigan Growth Opportunity
Michigan Growth Opportunity Marquette Connector Pipeline (MCP) Proposed pipeline that will connect the Great Lakes Gas Transmission pipeline to the Northern Gas pipeline in Marquette, Michigan • Approximately 42 miles mainly with 20” diameter pipe Provides needed redundancy and additional supply
Slide 33: Supportive Regulatory Environment for U.S. Gas Utilities
Supportive Regulatory Environment for U.S. Gas Utilities Allowed Location and ROE and Utility Customers1 Regulatory Update Rate Base1 Equity Thickness Use of projected test year for rate cases with 10 month limit to issue a rate order, eliminates/reduces regulatory lag Recovery of invested capit
Slide 34: Power
Power AltaGas |
Slide 35: Contracted Power
Contracted Power Generating clean energy with natural gas and renewable sources Strong footing in the 1,391 MW of Power market with a focus Power Generation1 on capital light, innovative 719 MW Gas 277 MW Hydro solutions 15 MW Wind 35 MW Biomass Diversified Power Portfolio 20 MW Energy Sto
Slide 36: AltaGas
AltaGas