Dte Energy Company · NYSE:DTE
Dte Energy — Merger or Acquisition (October 2019)
16 slides from Dte Energy's merger presentation, Oct 18, 2019
Slide 1: DTE to Acquire Midstream Assets
DTE to Acquire Midstream Assets Expanding DTE’s Midstream Business into High-Growth Basin with Strong Financial Returns 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain information presented herein includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, and businesses of DTE Energy. Words such as “anticipate,” “belie
Slide 3: Participants
Participants • Jerry Norcia – President and CEO • David Slater – GSP President and COO • Peter Oleksiak – Senior Vice President and CFO • Barbara Tuckfield – Director, Investor Relations 3
Slide 4: Expanding Growth Platform and Increasing Value Creation with Acquisition of High-Quality Midstream Assets
Expanding Growth Platform and Increasing Value Creation with Acquisition of High-Quality Midstream Assets • Premier assets in high-growth Haynesville basin – Existing fully contracted gathering system Existing Gathering System – Fully contracted large-diameter gathering Gathering Pipeline Under pipe
Slide 5: Transaction Overview
Transaction Overview Purchase Price1 $2.25B in cash plus milestone payment upon completion of gathering pipeline in development Financing2 50% equity (predominantly mandatory convertible equity units) and 50% senior unsecured debt Strong balance sheet and solid investment grade profile maintained Pr
Slide 6: Midstream System with High-Quality Assets in Haynesville Basin
Midstream System with High-Quality Assets in Haynesville Basin Gathering System • Fully contracted including minimum volume commitments • Current capacity of 1.2 Bcf/d; current utilization exceeds 95% • Primarily dry gas gathering; the system also has 170 MMcf/d of wet gas • Ability to expand to 2.5
Slide 7: Strong Producer with High-Quality Resource; Well-Positioned Among Dry Gas Formations in the U.S.
Strong Producer with High-Quality Resource; Well-Positioned Among Dry Gas Formations in the U.S. Strong Producer with High-Quality Resource U.S. Gas Supply Stack1 (wellhead breakeven $/MMBtu) • Largest natural gas producer in Louisiana • Over 20 Tcf resource to fill our gathering 4.0 pipeline long-t
Slide 8: Long-Term Contracts Include Minimum Volume Commitments, Demand Charges and Strong Credit Provisions
Long-Term Contracts Include Minimum Volume Commitments, Demand Charges and Strong Credit Provisions 13.5 year gathering system Agreement With Indigo Fully and 10 year gathering Contracted Strengthened by Credit Provisions pipeline contract terms • Proceeds from sale used to pay Acreage down signific
Slide 9: Well-Positioned in Haynesville to Serve Growing Gulf Coast and Southeast Markets
Well-Positioned in Haynesville to Serve Growing Gulf Coast and Southeast Markets Perryville Hub Haynesville basin poised for continued growth • Access to multiple downstream pipelines with Carthage Hub bi-directional capability Southeast • Serves multiple markets, including Power Markets Louisiana —
Slide 10: Capitalizes on DTE’s Operating Expertise to Bolster Record of Value Creation
Capitalizes on DTE’s Operating Expertise to Bolster Record of Value Creation Delivered HIGHLY ACCRETIVE organic growth from multiple platforms • Vector Pipeline • Millennium Pipeline • Bluestone Lateral & Gathering • NEXUS Pipeline Completed DISCIPLINED ACQUISITIONS with growth potential and connect
Slide 11: Accelerates Growth that Solidifies Earnings and Provides Visibility to GSP’s $4B - $5B Five-Year Investment Plan
Accelerates Growth that Solidifies Earnings and Provides Visibility to GSP’s $4B - $5B Five-Year Investment Plan DTE Capital Investment ($ billions) $20 • $3.25B acquisition related investment P&I $1.0 - $1.4 GSP Capital Investment – $2.25B initial purchase price Organic – $400M milestone payment up
Slide 12: Compelling Strategic and Financial Benefits
Compelling Strategic and Financial Benefits Highly and immediately accretive transaction that accelerates achievement of five-year growth plan High-quality assets underpinned by a strong resource in attractive Haynesville basin with potential upside Contracted assets with an experienced producer Cap
Slide 13: Appendix
Appendix 13
Slide 14: Rapidly Growing Haynesville Basin
Rapidly Growing Haynesville Basin U.S. Gas Supply by Basin Bcf/d 112 100 16 '14-’18 '18-’23 '23-’30 14 CAGR CAGR CAGR 83 19 (%) (%) (%) 9 16 69 Haynesville 11.6% 8.4% 2.4% 9 6 20 5 21 18 Permian 15.8% 12.2% 2.4% 15 15 Other Associated 14 3.7% 3.7% (1.0%) Gas 19 27 Other U.S. Supply (8.1%) (6.5%) 1.2
Slide 15: Haynesville is Well-Positioned to Serve Growing Gulf Coast Demand Centers
Haynesville is Well-Positioned to Serve Growing Gulf Coast Demand Centers U.S. Gulf Coast Demand by Sector Bcf/d 43 • Gulf Coast demand growth is driven 1 Commercial by the electric and industrial sectors and LNG exports 11 Industrial 30 • LNG exports in 2023 are from 1 1 Residential 4 Other facilit
Slide 16: Reconciliation of Reported to Operating Earnings (Non-GAAP)
Reconciliation of Reported to Operating Earnings (Non-GAAP) Use of Operating Earnings Information – Operating earnings exclude non-recurring items, certain mark-to-market adjustments and discontinued operations. DTE Energy management believes that operating earnings provide a more meaningful represe