GulfTerra Energy Partners, L.P.
GulfTerra Energy Partners, L.P — Enterprise Products Partners — Merger or Acquisition (December 2003)
31 slides from GulfTerra Energy Partners, L.P's merger presentation, Dec 15, 2003
Slide 1: Merger of Enterprise Products Partners L.P. and GulfTerra Energy Partners, L.P.
Merger of Enterprise Products Partners L.P. and GulfTerra Energy Partners, L.P. December 15, 2003
Slide 2: Investor Notice
Investor Notice Enterprise Products Partners L.P. ("Enterprise") and GulfTerra Energy Partners, L.P. ("GulfTerra") will file a joint proxy statement/prospectus and other documents with the Securities and Exchange Commission. Investors and security holders are urged to read carefully the joint proxy
Slide 3: Forward-Looking Statements - EPD
Forward-Looking Statements - EPD This presentation contains various 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 su
Slide 4: Forward-Looking Statements - GTM
Forward-Looking Statements - GTM This presentation includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The partnership has made every reasonable effort to ensure that the information and assumpti
Slide 5: Introduction
Introduction On December 15, 2003, Enterprise Products Partners L.P. (EPD), GulfTerra Energy Partners, L.P. (GTM) and El Paso Corporation (EP) announced a multi-step transaction that results in the merger of EPD and GTM. EPD will be the surviving parent partnership GTM will survive as a wholly-owned
Slide 6: Significance of Transaction
Significance of Transaction Strong asset position serving the major producing basins GOM onshore, shelf and deepwater South and East Texas Permian Basin San Juan Basin Rocky Mountains Canada's Western sedimentary basin through connections with third party pipelines in the upper Midwest Full service
Slide 7: Overview of Combined Operations
Overview of Combined Operations Pipelines 17,000+ miles of natural gas pipelines 13,000+ miles of NGL and petrochemical pipelines 340+ miles of GOM crude oil pipelines 164 MMBbls of NGL storage capacity 23 Bcf of natural gas storage capacity 6 GOM offshore hub platforms NGL Import/export terminals o
Slide 8: Value Drivers for Merger
Value Drivers for Merger Creates $13B partnership with the best GP structure among the universe of growth partnerships Highest GP incentive distribution right of 25% results in a lower cost of capital for the combined partnership; greater accretion from organic and acquisition growth; and transfer o
Slide 9: Compelling Rationale for Combination
Compelling Rationale for Combination Merger of EPD and GTM creates North America's leading midstream company Complimentary assets provide geographic and product diversity and balance Increased size and scope will enhance growth prospects Combined management team with proven track record of deliverin
Slide 10: Combined EPD and GTM System Map
Combined EPD and GTM System Map
Slide 11: Combined EPD and GTM Gulf Coast Assets
Combined EPD and GTM Gulf Coast Assets
Slide 12: Complementary Assets: MAPL - San Juan Basin Gathering/Processing
Complementary Assets MAPL - San Juan Basin Gathering/Processing Mid-America Pipeline - Rocky Mountain System 2,548 miles of pipe 120 MBPD capacity from Rock Springs, WY to 4- Corners; 225 MBPD capacity 4-Corners to Hobbs San Juan System Volumes 1.2 MMDth/d gathered 44 MBPD NGLs produced Gathering co
Slide 13: Complementary Assets: Texas Intrastate Natural Gas Pipeline
Complementary Assets Texas Intrastate Natural Gas Pipeline 9,300 miles of pipeline 3.35 Bcf/d 2002 volume 7 Bcf storage capacity 1,260 receipt and delivery meters 137 Intrastate, Interstate and municipal connections Firm contracts account for 50% of pipeline capacity 97% of storage capacity Fee base
Slide 14: Complementary Assets: Louisiana Intrastate Natural Gas Pipeline
Complementary Assets Louisiana Intrastate Natural Gas Pipeline Louisiana Acadian System Cypress System Evangeline System Napoleonville Storage Facility Baton Rouge Henry Hub New Orleans 1,042 miles of pipeline 1.0 Bcf/d capacity 700 MMcf/d in 2002 volume 50 connections with 12 interstate pipelines,
Slide 15: Complementary Assets: TX NGL Transportation and Fractionation
Complementary Assets TX NGL Transportation and Fractionation GTM South Texas integrated NGL pipeline and fractionation assets 1,000 miles of NGL pipelines Capacity 96 MBPD 2002 throughput 70 MBPD 9 South Texas natural gas processing/treating plants to be purchased from EP in Step 2 are an important
Slide 16: Complementary Assets: EPD & GTM's Gulf of Mexico Position
Complementary Assets EPD & GTM's Gulf of Mexico Position
Slide 17: Natural Gas Processing 2004 Effective Contract Mix
Natural Gas Processing 2004 Effective Contract Mix Margin Band % of Liquids Fee Keepwhole 0.49 0.4 0.1 0.01 Margin Band % of Liquids Fee Keepwhole 0.23 0.49 0.21 0.07
Slide 18: Step 1 Transaction Overview
Step 1 Transaction Overview The transaction is structured in two steps. Step 1 will close on December 15, 2003. Step 2 will take place after unitholder approval, FTC approval and satisfaction of other customary closing conditions (expected 2H2004). Step 1 EP reacquires 9.9% ownership interest in GTM
Slide 19: Step 1 Transaction Structure Diagram
Step 1 Transaction Structure Diagram 0% 50% GulfTerra Energy Company, L.L.C. (GTM's general partner) $425 Million Cash El Paso Corporation Enterprise Products Partners L.P. Goldman Sachs 50% GP Interest 9.9% GP Interest Cash and/or GTM Units 9.9% 0% (1) 90.1% 50% (1) (1) Occurs concurrent with Step
Slide 20: EPD Step 1 Estimated Post-Closing Capitalization
EPD Step 1 Estimated Post-Closing Capitalization
Slide 21: Step 1 Transaction Governance
Step 1 Transaction Governance The portion of the GTM GP membership interest purchased by EPD would: have a sharing ratio of 50.0%; and be non-voting with respect to directors and/or managment of GTM, but EPD would have to approve any voluntary bankruptcy petition or any other action relating to the
Slide 22: Step 1 Transaction Other Provisions
Step 1 Transaction Other Provisions There are no unwind provisions. If the merger of EPD and GTM does not occur - EPD would continue to own the 50% interest in GTM GP and receive 50% of all future cash distributions paid by GTM to GTM GP Each of EPD and EP will have a ROFR if the other party elects
Slide 23: Step 2 Transaction (EPD/GTM Merger) Overview
Step 2 Transaction (EPD/GTM Merger) Overview EP contributes its 50% ownership interest in GTM's GP to EPD's GP in exchange for a 50% ownership interest in EPD's GP. 50% interest in GTM's GP interest (with associated annual cash flow of $40-45MM) is subsequently contributed from EPD's GP to EPD for n
Slide 24: Step 2 Transaction (EPD/GTM Merger) Overview (continued)
Step 2 Transaction (EPD/GTM Merger) Overview (continued) GTM unitholders receive 1.81 EPD common units for each GTM unit. Represents a 2.2% premium based on GTM and EPD closing prices on December 12, 2003. EP would exchange its remaining 7.5MM GTM units at 1.81x for 13.6 EPD units. Estimated EPD uni
Slide 25: Step 2 Transaction Structure Diagram
___________________________ Represents limited partner unit exchange (excludes units held by El Paso). Step 2 Transaction Structure Diagram
Slide 26: Step 2 Transaction Pro Forma Ownership & Structure
Step 2 Transaction Pro Forma Ownership & Structure
Slide 27: Post Merger Governance of GP
Post Merger Governance of GP Board Composition - The Board of EPD's GP will consist of 10 members. EPCO and El Paso will each designate 5 members, of which 3 of each group of 5 would be independent members. The initial 2 EPCO insider Board members will be Dan L. Duncan, the current Chairman of EPD's
Slide 28: Post Merger Governance of GP (continued)
Post Merger Governance of GP (continued) The following items would require approval by the Board and at least one insider Board member designated as such by each member ("Designated Insider"): any merger or consolidation involving EPD's GP; any merger or consolidation involving EPD in respect of whi
Slide 29: Post Merger Management
Post Merger Management Dan Duncan will continue to serve in his current capacity of Chairman of EPD GP Dub Andras will be named Vice Chairman of EPD GP and will continue to serve as CEO of EPD GP Bob Phillips, currently Chairman and CEO of GTM, will be named President and COO of EPD GP Other managem
Slide 30: EPD Step 2 Estimated Post-closing Ownership
EPD Step 2 Estimated Post-closing Ownership Historical ownership at December 1, 2003 adjusted only for the issuance of $100MM of Class B units and the estimated number of EPD units issued in exchange for GTM units at the consummation of the merger.
Slide 31: Q&A
Q&A ©All rights reserved. Enterprise Products Partners LP.
Enterprise Products Partners — Merger or Acquisition (December 2003) on 6ix