Attached files
| file | filename |
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| EX-99.1 - EXHIBIT 99.1 - SOUTHERN UNION CO | presentation.pdf |
| 8-K - SOUTHERN UNION COMPANY FORM 8-K, APRIL 6, 2010 - SOUTHERN UNION CO | suform8k_040610.htm |
RBC
Capital Markets
Investor
Meetings
April
6, 2010
Forward-Looking
Statements
Company
Overview
*Focus on natural gas
infrastructure
-Attractive industry outlook
-Natural gas is key to America’s energy future
-High-quality assets with diverse supply and strong
markets
*Principally
regulated asset base
-Provides earnings and cash flow stability through
long-term contracts
-Business model proven to weather economic
cycles
*Organic
growth projects provide low-risk growth trajectory
Map
of Operations
Company
Facts
Transportation
& Storage
*Vast pipeline network with
access to diverse supply sources and growing markets
*Approximately
15,000 miles of interstate pipelines with transportation capacity of 7.8
Bcf/d
*One
of North America’s largest liquefied natural gas (LNG) import terminals with
peak send out of 2.1 Bcf/d and storage of 9 Bcf
*Owns/leases
approximately 100 Bcf of storage
Transportation
& Storage Assets
Trunkline
LNG:
Infrastructure
Enhancement Project
FGT
Phase VIII Expansion
FGT
Phase VIII Expansion Timeline
FGT
Pascagoula Lateral
Gathering
& Processing
*Located in prolific,
long-lived Permian Basin
*Approximately
5,500 miles of gas and gas liquids pipelines covering 16 counties in West
Texas/Southeast New Mexico
*Two
fully-integrated midstream systems (North and South) connected via high-pressure
pipelines
*Four
active cryogenic plants and six active treating plants
-Restarted Mi Vida treating facility in February
2010
-Expect to restart Halley processing plant in
4Q2010
*Attractive
downstream markets
*Attractive
contract mix: 98%+ POP / Fee-based
Map
of Operations
North
System
*Consists of the Jal and
Keystone Systems
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-Low pressure integrated sour gas gathering
systems
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-Average processed volumes over 200
MMcfd
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-22,000+ barrels per day (bpd) NGL
production
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-225 MMcfd cryogenic processing
capacity
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-325 MMcfd sour gas treating
capacity
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-40 tons per day sulfur plant
capacity
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-Recent compression and high pressure pipeline
upgrades
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-Treating capacity expansion at Jal 3 plant,
including acid gas injection well, completed early
2009
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South
System
*Consists of the Mi Vida,
Coyanosa and Tippett Systems
-High pressure integrated sweet and sour gas gathering
systems
-Average wellhead volumes 270 MMcfd
-Average processed volumes 170 MMcfd
-11,000+ bpd NGL production
-190 MMcfd cryogenic processing capacity
-250 MMcfd sour gas treating capacity
*Grey
Ranch System (50% ownership)
-High CO2
gathering and treating system
-Earn fixed fee for removing CO2
from gas
-200 MMcfd treating capacity
High
Pressure Transfer System
Gas
Supply Contracts
*Substantially eliminated true
keep whole exposure
*Changed
gas pricing mechanism – First of Month to Gas Daily
-Matches daily priced gas to daily priced
NGL’s
-Mitigates risk from daily volume swings
*Producer indemnifications negotiated on many capital
intensive projects
2010
Growth Opportunities
Gathering
& Processing Assumptions
*Positive processing spread
environment encourages optimal Natural Gas Liquid recoveries; Normalized fuel,
flare and unaccounted-for volumes
*2010
projected equity volumes
-Natural Gas Liquids equivalent of 40,000 to 45,000
MMBtu/d
-Natural Gas of 7,000 to 15,000 MMBtu/d
*2010
hedge positions
-40,000 MMBtu/d of NGL equivalent at $10.44
-5,000 MMBtu/d of natural gas $5.33
*2011
hedge positions
-25,000 MMBtu/d of NGL equivalent at $11.63
Distribution
*Missouri Gas Energy
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-Provides natural gas to over 500,000
customers
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-Nearly 13,000 miles of main and service
lines
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-Received a $16.2MM annual base rate increase
effective February 28, 2010
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-New rate design eliminates impact of weather or
conservation on margin for residential and small general service customer
classes
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*New England Gas
Company
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-Provides natural gas to 50,000 customers
-Nearly 2,000 miles of main and service lines
-Received $3.7MM in increased annual base rates in February
2009
Corporate
& Other
*Corporate segment provides
administrative and support functions to business segments and allocates expenses
as appropriate
*Other
segment primarily consists of PEI Power Corporation which owns interests in and
operates 75 MW of generating assets in the PJM ISO and Fall River Gas
Appliance
Summary
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*Focus on natural gas related
infrastructure
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*Actively managed hedging program helps mitigate
volatility in NGL margins
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*Organic growth projects with clear visibility
towards earnings and cash flow
growth
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*Balance preservation of investment grade credit
ratings and return of capital to
shareholders
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2010
Financial Outlook
2010
Outlook
*2010 adjusted net earnings per share of $1.75 to
$1.95
*2010
reported net earnings per share of $1.92 to $2.12
EPS
Reconciliation
2010
Consolidated Adjusted EBITDA
2010
Adjusted Segment EBITDA
2010
Adjusted EBITDA by Segment
2010
Net Capital Expenditure Guidance
SUG
General Assumptions
*Approximately 125 million
weighted average diluted shares outstanding
*Effective
income tax rate of 30.3%
*Interest
expense, net of capitalized interest, approximately $225 to $235
million
Reg.
G Reconciliation
Reg.
G Reconciliation – continued