Kinder Morgan, Inc. · NYSE:KMI
Kinder Morgan — Kinder Morgan Energy Partners — RBC 2010 MLP Conference
20 slides from Kinder Morgan's conference presentation, Nov 19, 2010
Slide 1: RBC 2010 MLP Conference
ENERGY PARTNERS, L.P. RBC 2010 MLP Conference Kim Dang Ki D Chief Financial Officer November 19, 2010
Slide 2: Forward Looking Statements
ENERGY PARTNERS, L.P. F Forward dLLooking ki Statements St t t This presentation contains forward looking statements. These forward-looking statements are identified as any statement th t does that d nott relate l t strictly t i tl to t historical hi t i l or currentt facts. f t In I particular, ti
Slide 3: Use Of Non-GAAP Financial Measures
ENERGY PARTNERS, L.P. U Of Non-GAAP Use N GAAP Financial Fi i l Measures M The non-generally accepted accounting principles ("non-GAAP") financial measures of distributable cash flow before certain items (both in the aggregate and per unit), segment earnings before depreciation, depletion, amortizat
Slide 4: Capital Structure
ENERGY PARTNERS, L.P. C it l Structure Capital St t Kinder Morgan Energy Partners, L.P. Market Equity (a) $21.4B Debt (b) 11.5B 11.5 B Enterprise Value $32.9B 2010E EBITDA (c) $3.2B (e) 2010E DCF (d) $2.4B (e) Additional Cash Incentive Shares Distribution Distribution KMR (NYSE) KMP (NYSE) (LLC) (Pa
Slide 5: KMR 101
ENERGY PARTNERS, L.P. KMR 101 (a) ( ) KMR is KMP KMR shares are pari passu with KMP units KMR Discount to KMP 10% KMR dividend equal to KMP cash distribution, but paid in additional ~7% avg discount shares; effectively a dividend reinvestment program (b) 5% since 2001 IPO Share dividend reduce
Slide 6: The Kinder Morgan Strategy
ENERGY PARTNERS, L.P. The Th Ki Kinder d M Morgan St Strategy t Same Strategy Since Inception Focus on stable, fee- 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 v
Slide 7: Unmatched Footprint
ENERGY PARTNERS, L.P. Unmatched Jet Trans Fuel Mountain Pi li Pipeline Footprint 2 Cochin Largest independent transporter of petroleum products in the U.S. Pacific Express Transport T t ~1.9 1 9 million illi bbarrels l per day (Bbl/d) 2nd largest transporter of natural gas in U.S. (a) Trailbla
Slide 8: Well-diversified Cash Flow
ENERGY PARTNERS, L.P. Well- W ll-diversified Well di ifi d Cash C h Flow Fl KMP 2010E CO2 Segment DCF Natural Nat ral Gas Pipelines 28% CO2 transport and sales Profile (b) 59% Interstate (c) 72% oil production related 41% Texas Intrastate Production P d ti h d d (a): hedged 2010=79% ($58/B
Slide 9: A Stable Asset Base
ENERGY PARTNERS, L.P. St bl A Stable Assett B Base Natural Gas Products Kinder Morgan CO2 Terminals Pipelines Pipelines Canada – Interstate: virtually all – Liquids: take or pay take or pay – S&T: minimum – Bulk: minimum Volume Security – volume based – No volume risk – Intrastate: ~78% volume gua
Slide 10: Delivering 13 Years Of Consistent Growth
ENERGY PARTNERS, L.P. Delivering D li i 13 Years Y Of Consistent C i t t Growth G th Total Distributions (GP + LP) ($MM) (a) Annual LP Distribution Per Unit (a,d) $ $2,500 $2 416 $2,416 $4 40 $4.40 GP (b) $4.50 $4.20 $2,132 $4.02 $4.00 $3.48 $2,000 LP $1,854 $3.50 $3.13 $3.26 $2.87 $1,469 $3.00 $2.6
Slide 11: Significant Historical Returns
ENERGY PARTNERS, L.P. Si ifi Significant t Historical Hi t i l Returns R t (a) ( ) KMP: 26% CAGR Since ‘96 (b) KMR: 14% CAGR Since ‘01 (c) Dollars Dollars AMZ (d) $2,800 $400 KMP = $2,590 = $403 $2,450 $350 KMR = $354 $2,100 $300 $1,750 $250 $1,400 $200 $1,050 $150 AMZ (d) = $871 $700 $ $100 $ $50 S
Slide 12: Promises Made, Promises Kept
ENERGY PARTNERS, L.P. Promises P i Made, M d Promises P i Kept K t P Promises i Made M d Promises P i Kept K t Budgeted Actual Distribution per unit: Distribution per unit: 2000: $1.60 2000: $1.71 2001: $1.95 2001: $2.15 2002: $2.40 2002: $2.435 2003: $2.63 2003: $2.63 2004: $2.84 2004: $2.87 2005:
Slide 13: Sources Of Future Growth
ENERGY PARTNERS, L.P. Sources S off F Future t G Growth th Growth Drivers KM Opportunity – Leverage Footprint – Cheap Cheap, abundant, abundant domestic energy source – Leverage pipeline connectivity and expertise – Shifting supply from multiple basins into pipeline/storage expansions and – U.S. dem
Slide 14: Kinder Morgan is Connected to Major New Natural Gas Basins
ENERGY PARTNERS, L.P. Kinder Morgan is Connected to Major New Natural Gas Basins Through g KM’s existing g natural gas g Trailblazer REX footprint and current projects we are connected to virtually every major REX TransColorado KMIGT natural gas basin in the U.S.: Rocky Mountains (REX) 2 FEP Bar
Slide 15: ~$20 Billion in Capital Invested 1998-2009
ENERGY PARTNERS, L.P. ~$20 $20 Billi Billion in i Capital C it l Invested I 1998-2009 (a,b) t d 1998- ( b) (billions) Total Invested by Type (a,b) Total Invested by Year (a) $12 $2.4 $9 $3.5 $3.3 JV Contributions $6 E Expansion i $3.0 $2.9 $8.7 $8.8 Acquisition $3 $2.7 $2.5 $2.5 $0 Expansions pa s o
Slide 16: Returns on Capital
ENERGY PARTNERS, L.P. Returns R t on C Capital it l 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Segment ROI (a): Products Pipelines 11.9% 11.8% 12.8% 12.9% 12.4% 11.6% 11.8% 13.2% 12.5% 13.4% Natural Gas Pipelines 13.3 15.5 12.9 13.5 14.0 15.5 16.7 17.5 16.9 14.0 CO2 27.5 24.6 22.0 21.9 23.8 2
Slide 17: Balance Sheet Remains Solid
ENERGY PARTNERS, L.P. B l Balance Sheet Sh t Remains R S lid (a) i Solid ( ) (millions) Credit Summary Forecast 3Q 2010 Yr Yr--end 2010 Credit Metrics Debt / EBITDA (b,c) 3 8x (d) 3.8x 3 8x (d) 3.8x EBITDA / Interest (c) 6.5x 6.2x L-T Debt Rating Baa2/BBB/BBB (e) Revolver Liquidity Long--term Debt (
Slide 18: Risks
ENERGY PARTNERS, L.P. Ri k Risks Regulatory Pacific Products Pipeline FERC/CPUC cases Periodic rate reviews Unexpected policy changes Crude Oil Production Volumes Crude Oil Prices Budget assumes $84/Bbl realized price on unhedged barrels 2010 Sensitivity is ~$5.5 million DCF per $1/B
Slide 19: Attractive Value Proposition
ENERGY PARTNERS, L.P. Att ti V Attractive Value l P Proposition iti Unparalleled asset footprint Established track record Industry leader in all business segments Experienced management team Supportive general partner Transparency T to t investors i t Attractive returns driven by combi
Slide 20: Kinder Morgan Energy Partners, L.P.
KINDER/MORGAN ENERGY PARTNERS, L.P.
Kinder Morgan Energy Partners — RBC 2010 MLP Conference on 6ix