Shale Revolution & Energy Transfer Partner’s Liquids ... · PDF fileShale Revolution &...
Transcript of Shale Revolution & Energy Transfer Partner’s Liquids ... · PDF fileShale Revolution &...
Rick Cargile - President Midstream Gas/Electric Partnership ConferenceFebruary 6, 2014
Shale Revolution & Energy Transfer Partner’s Liquids Transformation
Legal Disclaimer
2
This presentation may contain statements about future events, outlook and expectations ofEnergy Transfer Equity, L.P. (ETE), Energy Transfer Partners, L.P. (ETP), Sunoco LogisticsPartners L.P. (SXL), Southern Union Company, and Regency Energy Partners LP (RGP)(collectively, the “Companies”), all of which are forward-looking statements. Any statement inthis presentation that is not a historical fact may be deemed to be a forward-looking statement.These forward-looking statements rely on a number of assumptions concerning future eventsthat are believed to be reasonable, but are subject to a number of risks, uncertainties and otherfactors, many of which are outside the Companies’ control, and which could cause the actualresults, performance or achievements of the Companies to be materially different. While theCompanies believe that the assumptions concerning future events are reasonable, we cautionthat there are inherent difficulties in predicting certain important factors that could impact thefuture performance or results of our businesses. These risks and uncertainties are discussedin more detail in the filings made by the Companies with the Securities and ExchangeCommission, copies of which are available to the public. The Companies expressly disclaimany intention or obligation to revise or publicly update any forward-looking statements,whether as a result of new information, future events, or otherwise.
All references in this presentation to capacity of a pipeline, processing plant or storage facilityrelate to maximum capacity under normal operating conditions and with respect to pipelinetransportation capacity and are subject to multiple factors (including natural gas injections andwithdrawals at various delivery points along the pipeline and the utilization of compression)which may reduce the throughput capacity from specified capacity levels.
Jobs ~600,000Jobs ~600,000
Operators
Welders
Mechanics
Higher Wages
Truckers
1 Direct = 3 Indirect
Natural GasNGLs
Natural GasNGLs
AffordableClean
Abundant
Land OwnersLand OwnersROWROW
RoyaltiesRoyalties
Water RightsWater Rights
Land OwnersROW
Royalties
Water Rights
ManufacturingManufacturing
Electricity
Housing
Petrochemicals
Autos
Exports
InfrastructureInfrastructure
Hotels
Roads
Housing
Restaurants
EquipmentEquipmentSteelCompression
VehiclesRigs
TaxesTaxesProperty
State\Local\Fed
Sales Production
Shale Development Fueling the U.S. Economy
4
5
Oil & Gas Creating Jobs
* Nonfarm Payroll does not include farm, private household and non-profit employees
7
Regional Net Supply Transformation (2013 – 2017)
Dynamic Imbalances in Gas/Hydrocarbon Flows & Infrastructure Consequences
Bentek
9
Largest intrastate pipeline system in Texas
ET Fuels 36”
WAHA Oasis 36”
Houston Pipe Line
Katy
Carthage
HSC
Corpus LNG
PEMEXAgua Dulce
Bammel Storage 62 Bcf
ETP Texas Residue Gas Footprint
Freeport LNG
11
The Bridge to “Somewhere”
COAL
Natural Gas
NUCLEAR
Shale Revolution • LNG Exports• Mexico & Canada Exports• Industrial Growth (GTL, MEOH, Ammonia, Crackers, PDH, etc.)• Power Generation (Coal displacement – lower emissions)• NGL, Gasoline and Diluent Exports
OI L
RENEWABLES
Historical NGL Yield From Natural Gas Processing
12Source: Wells Fargo
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-141.10
1.15
1.20
1.25
1.30
1.35
1.40
1.45
1.50
1.55
1.60
1.65
1.70
Gal
lons
of N
GL'
s pe
r MC
F of
Nat
ural
Gas
NGL YieldGPM will trend higher in 2014 given producer push to NGL-rich plays and build-out of NGL fractionation capacity
Gas Production is getting richer
Total U.S. NGL Supply
13
65%66% 64% 64% 66% 66% 70% 72% 74% 75% 78%
25% 23%21% 23% 24% 23%
22%22%
20%19%
18%
10% 11%15% 13% 10% 11% 8%
6%6%
6%4%
2,648 2,759 2,665 2,725 2,712 2,688 2,711 2,894
3,065 3,208
3,457
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sep-13
Tota
l Dom
estic
NG
L Su
pply
(MB
bls/
d)
Imports Refinery Outputs Natural Gas Processing
Source: Wells Fargo
Domestic NGL supply has increased
U.S. NGL Production Grows By ~2 MMB/d
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MMB/d
Marcellus, 34,647 Utica, 0 Eagle Ford,
187,025
Permian, 327,734
Anadarko, 304,717
Rockies, 375,965
Other,960,911
2011 Production 2.2 MMb/d
Bakken,25,000
Marcellus, 466,052 Utica,
247,208
Eagle Ford, 871,703
Permian, 433,114
Anadarko, 536,068
Rockies, 423,907
Bakken, 599,163
Other,876,849
2023 Production ~ 4.5+ MMb/d 700 Mbpd
800 Mbpd600 Mbpd
200 MbpdSource: Bentek Energy
-
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
U. S. Raw Mix Production from Gas Plants
1 MMb/d1 MMb/d
1 MMb/d
+ Refinery NGL’s
Domestic NGL supply expected to grow
Total U.S. NGL Demand
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39%43% 42% 44% 44% 42% 43% 45% 46% 45% 45%
34%33% 33% 31% 31%
32% 30%28%
26% 24% 20%
25% 22%23% 22% 22%
22% 22%22%
21% 21% 22%2% 2% 2% 3% 3%4%
5%5%
7% 10% 14%2,685 2,733 2,648 2,707 2,770
2,618 2,752
2,872 3,045 3,141
3,356
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sep-13
Tota
l Dom
estic
NG
L D
eman
d (M
Bbl
s/d)
Exports Gasoline Blending Heating & Other Petrochemical Demand
Source: Wells Fargo
NGL domestic demand and exports are growing
U.S. Net Exporter of Hydrocarbons
16
Net Exports (MBpd) NGL Production
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2007 2008 2009 2010 2011 2012 2013 2014‐200
‐150
‐100
‐50
0
50
100
150
200
250
300
350
Surplus NGL production is driving exports
Historical Composition Of NGL Field Production
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36% 38% 38% 39% 40% 39% 40% 42% 42% 40% 37%
29% 29% 29% 29% 28% 29% 29% 28% 28% 30% 32%
10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 8%
8% 8% 8% 7% 7% 7% 7% 7% 7% 7% 10%
16% 15% 16% 15% 15% 15% 14% 13% 13% 13% 14%
0%
20%
40%
60%
80%
100%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Aug-13
% C
ompo
sitio
n of
U.S
. NG
L Fi
eld
Prod
uctio
n
Ethane Propane Normal Butane Iso Butane Natural Gasoline
Source: Wells Fargo
C2 Rejection
New ShaleGas ~50%
NGL BBL is getting lighter
Composition Of Ethane Demand
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626689
639 666 653592 618
710763 761 786
61
86
6778 117
122
181
171167 172
199
687775
706744 770
714
799
881930 933
985
0
200
400
600
800
1,000
1,200
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sep-13
Com
pone
nts
Of E
than
e D
eman
d (M
Bbl
s/d)
Export-driven ethane demand
Domestic ethane demand
Source: Wells Fargo
Ethane demand increasing2X
Maximum Domestic C2 Cracker Capacity
20Source: Wells Fargo
• Incremental 800 Mb/d C2 and 1.8 MMb/d y-grade by 2020– 300 to 500 b/d Ethane rejected or exported
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Max Cracking Capability for US Ethane(1000 BPD)
Low Probability New Plant
Fair Probability New Plants
High Probability New Plants
US Ethane Cracked inCanada
Conversions/Expansions/Restarts
Base C2 Cracking Capability
Surplus Ethane Export & Reject
Ethane demand growing
Composition Of Steam Cracker Feed Slate
21Source: Wells Fargo
43% 63%
57% 37%
1,816 1,729 1,755 1,768
1,568 1,523 1,581 1,617 1,584 1,633 1,668
0
400
800
1,200
1,600
2,000
2,400
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013TD Nov-13
Tota
l Dom
estic
NG
L D
eman
d (M
Bbl
s/d)
Ethane Propane Butane Naphtha Gas Oil
Cracker feed is getting lighter
Light Feeds As Percentage Of Total Ethylene Feedslate
22
40%
50%
60%
70%
80%
90%
100%
Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13.0x
10.0x
20.0x
30.0x
40.0x
50.0x
60.0x
Ligh
t Fee
ds A
s %
Of T
otal
Fee
dsto
ck
Cru
de O
il/ N
atur
al G
as R
atio
Crude Oil/Natural Gas Ratio (Left Axis)
Light Feeds as % of total feedslate (Right axis)
Source: Wells Fargo
Oil to Gas ratio and light feeds have increased
SteamCracker
Steam Cracking Product Slate Changing
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Natural GasLiquids
Oil RefineryOutputs
Propane
Ethane
Butane
Gasoline Blend
NaphthaLi
ght
Feed
stoc
ksH
eavy
Feed
stoc
ks Aromatics (C5+)
Propylene
Ethylene
Butadiene
Ole
fins
PDH & Export
Light feeds have increased and changed product slate
Net Ethylene Derivative Exports
24Source: Wells Fargo
43%
46%34%
36%
27%
15%
13%
12%11%
9%
17%
43%
31%32%
32%
31%
33%
31%
40%48% 48%
41%
13%23% 34%
33%
42%
52%
56%48%
41% 43%
42%
2,024
2,842
2,299
2,625
3,801 3,837
5,032
4,513 4,295 4,375
4,975
0
1,000
2,000
3,000
4,000
5,000
6,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sep-13
Net
Eth
ylen
e D
eriv
. Exp
orts
(MM
Ton
s / Y
r)
Polyethylene Vinyls Other
> 2X
Ethylene derivative exports have more than doubled
Historical Ethane-To-Crude Oil Ratio
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Jan-10 Apr-10 Jul-10 Oct-10 Dec-10 Apr-11 Jul-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-135%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
Etha
ne to
Cru
de O
il R
atio
(%)
Ethane to WTI Crude Ratio
Source: Wells Fargo
Excess ethane is making U.S. competitive
Energy Transfer Enterprise Structure
ENERGY TRANSFER EQUITY, L.P.(NYSE: ETE)
SUNOCO LOGISTICS PARTNERS, L.P.
(NYSE: SXL)
ENERGY TRANSFER PARTNERS, L.P.(NYSE: ETP)
REGENCY ENERGY PARTNERS L.P.(NYSE: RGP)
Blue denotes Publicly Traded Partnership
LP Interest, GP Interest, IDRs
LP Interest, GP Interest, IDRs
Gathering and Processing
Contract Compression
& Treating
Joint Ventures
Intrastate Transportation
and Storage
Interstate Transportation
and Storage
Midstream
NGL Transportation and Services
70% Interest30% Interest
Refined Product
Pipelines
Terminal Facilities
Crude Oil Pipelines
Crude Oil Acquisition
and Marketing
Standard Equipment Company
Sunoco, Inc.Retail
Marketing
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LP Interest, GP Interest, IDRs, Class H Units*
* Class H Units track 50% of the SXL GP and IDR economics
Energy transfer today -a leading midstream energy platform
ETP Assets
*Map is a general depiction of Energy Transfer assets
SXL Assets
RGP Assets
Eastern Gulf Crude Access Pipeline
Energy Transfer Projects
Mariner South
Trunkline LNG Export
Energy Transfer Asset Overview
Sunoco Retail Locations includes Distributers, Dealers, and Co-ops
PVR Assets
KEY ASSETS COMBINED
~ 62 Plants (2 under construction)
~176 Bcf Gas Storage
>90 MMBbls NGL\Oil Storage
3 Fractionators
~2 Bcfd LNG Import
> 4.0 MM HP Compression
~1.5 MMBpd Crude Oil
~ 5,000+ Retail Locations
Approximately 61,000 miles of crude oil, refined products, natural gas, and NGL pipelines
Recently Acquired by RGP; subject to close
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ETE’s Business Model Transformation
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2009 ~ 900+ Employees 2014 ~ 11,600 Employees
Dry Gas Liquids Rich
Midstream - Gathering & Processing
Lone Star NGL – Trans\Frac & Storage
LNG – import\export
Sunoco - Crude Oil & Refined ProductsLogistics\Retail
LoneStar\SXL – LPG export
Gas Transmission\StorageInterstateIntrastateStorage
ETE’s Business Model Transformation
Processing Capacity 0.3 3.0+ Bcfd
NGL Production 20 400+ Mbpd
NGL Transportation 0 520+ Mbpd
NGL Fractionation Capacity 0 250 to 350 Mbpd
Crude Oil Transportation
0 2,500+ Mbpd
2009 2015(est. based on developing projects)
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NGL, Crude & Purity Products Storage 0 90+ MMbbls
Natural Gas Liquid Production (2012)
30
0 100 200 300 400 500 600
CXTMWE
OneOkCopano
DevonETE
TargaWilliams
EPDDCPETE
MBPD
ETE 2013 ~200 Mbpd
ETE 2015 ~ 400 Mbpd(estimate based on developing projects)
ETE 2010 ~15 Mbpd
ETE 2011 ~70 Mbpd
* ETE includes ETP, SUGS, RGP
ETE 2012 ~95 Mbpd
Dry Gas Shale ==> Liquid Rich Shale
HoldCo (SUGS)
Chisholm PlantLaGrange ExpansionSpirit NGL
West Texas GatewayJusticeMt. Belvieu Frac #1Kenedy PlantJV Ranch Plant
Jackson #4Rebel PlantMivida PlantMariner EastMariner SouthTrunkline CrudeRio Bravo CrudeTW Phoenix Exp.FGT ExpansionMexico
Southern Union
REMChisholmLos BonitasDos HermanasSan CajosFreedom NGLLiberty NGL
Red RiverHaley Expansion
Sunoco
Louis Dreyfus
2011 1st Half 2012 2nd Half 2012 1st Half 2013
Jackson #1 & #2Godley #5Red Bluff PlantDubach Plant
2nd Half 2013
TLNG
2014-15 2010
TigerFGT VIII
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ETE Growth Execution - > $45B
2019
Jackson #3REM LoopMt. Belvieu Frac #2Permian ConnectorSEC ExpansionMariner West
PVR, Hoover,
Eagle Rock (pending)
Strategic M&A, thousands of miles of new pipe construction,repurposing pipe, 12 Plants, 2 Expansions and 2 Fractionators
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150
200
200
250
290
400
488
1,160
1,325
1,340
1,523
0 500 1000 1500
Formosa
BWP
WES
HEP
Texstar
Southcross
TEAK
XOM
DPM
CPNO
ETP
EPD
90
113
120
488
525
623
760
0 200 400 600 800
Southcross
Formosa
ETP
XOM
CPNO
EPD
DPM
Eagle Ford Processing Capacity Up by 175%
Mbpd Mbpd
2010 – 2.7 Bcf/d Total 2014E – 7.4 Bcf/d Total
4.7 Bcfd New Capacity Producing ~ 550 Mbpd NGL
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33
La Grange Expansion 200 MMcfdChisholm 120 MMcfd
Freedom 8” & Liberty 12”75 Mbpd
Mt. BelvieuFracs 1 & 2200 Mbpd
Spirit 8”
Justice 20”340 Mbpd
REM 30” & 42”(Working Expansion)
W Texas Gateway 16”209 Mbpd
Kenedy200 MMcfd
Jackson800 MMcfd
Las Tiendas Treater300 MMcfd
ETP Eagle Ford Rich Gas Footprint
Formosa
Sweeny
Mt. Belvieu
San Cajos 30”
Las Bonitas24” & 30”
Chisholm 20”
Dos Hermanas 24”
Extending the vertical value chain, creating critical mass and operational flexibility
35
ETP LaGrange\Chisholm
CP ChemSweeny
Formosa
RGPWaha
RGP Coyanosa
RGPBone Springs
RGPHaley
RGP Tippett
RGPJal RGP
KeystoneRGP
Red Bluff
RGP Mivida
ETPGodley 1,2,3,5
ETP Kenedy
ETPJackson 1,2,3,4
Lone StarWest Texas Gateway 16”
(210 Mbpd)
Lone StarWest Texas Pipeline 12”
(140 Mbpd)
Lone StarMt. Belvieu Frac
(200 Mbpd)
ETPJustice 20”(340 Mbpd)
Energy Transfer Synergistic Footprint
ETPFreedom\Liberty
(75 Mbpd)
ETPRebel
Lone Star Mont Belvieu Complex
36
Frac I 100 MbpdDec 12’
Frac II 100 MbpdOct 13’
De-C2 100 MbpdQ1 15’Frac III 100 Mbpd
(site)
Mariner South - C3 & C4 Export/Import
C3 - 200 MBPD(C4 batching)
Mont Belvieu Facilities
Nederland Terminal
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• Joint project between SXL and Lone Star
• Will integrate SXL’s existing Nederland terminal and pipeline from Mont Belvieu with Lone Star’s Mont Belvieu fractionation and storage facilities
• Will create a world class LPG export/import operation in the Gulf Coast
• Expected Q1 2015 in-service date
• Initial capacity of 6 million barrels per month
• Nederland Terminal will provide 24-hour ship access in the Gulf Coast with a load rate of up to 30,000 barrels/hr
• Shell Trading US Company, STUSCO, has committed to the project as an anchor customer under a long-term, fee-based contract
Rio Bravo Crude Pipeline Project
Conversion of HPL gas pipeline • Convert 84 miles of 18” & 24” gas
pipelines to crude service • Construct meter stations, pump
stations, interconnects and 3 miles of new pipe
• Connect to Trafigura splitter and terminal at Corpus Christi
• Expected in-service Q3/Q4 2014
Capacity Lease Agreement• Leased 100% of system to Trafigura• 100 Mbpd of crude/condensate• 10 year agreement with renewal
option
Gas Pipeline Revenue• Gas transport revenue retained
38
39
East Gulf Crude Access Project - Trunkline 30” Conversion -
Potential Scope
• Batched system with capacity of 420 Mbpd
• Repurposing approximately 574 miles of 30” pipeline
• Received FERC abandonment approval November 2013
• Anticipated in-service by mid 2016
Patoka
Boyce
Nederland
First direct crude oil pipeline to the Eastern Gulf Coast refinery market from the Midwest
Lake Charles
Lake Charles LNG
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PROPOSED 3 TRAIN OPERATION DATES:• Train 1: March 31, 2019 • Train 2: December 31, 2019 • Train 3: September 30, 2020Capacity up to 16 mtpa – 2.6 Bcf/d from three trains• DOE approved non-FTA• Filed Draft RR No. 13 for Lake Charles LNG export project• Formal FERC application expected end of Q1 2014• Lake Charles LNG FID/Financial Closing expected Mid-2015
KEY PROJECT ATTRIBUTES:
COMMERCIAL TERMS:• Agreed on principal terms with BG on a “tolling basis” for a
minimum 25-year term• Rate established at final investment decision (“FID”) based on
estimated project costs• Additional upside from 3.1 Bcf/d long term transportation
arrangement with BG beginning in 2019 through 2044New Transfer Line New Facility Area
Proposed Facilities/BuildingsExisting Facilities
BG:• To design facility and
responsible for construction management
• Responsible for all project costs and performance
• Will operate the facility (including regas facility) beginning in 2016
Lake Charles LNG: (owned 60% ETE, 40% ETP)• Lake Charles LNG to own
and finance the project• Also can fund cost
overruns or direct BG to fund
SXL Marcellus-Utica NGL SolutionEnhanced NGL takeaway capability from Marcellus-Utica to export markets
• West 50 Mbpd purity C2 mid 2013 to Sarnia
• East 70 Mbpd EP mix to Marcus Hook– C3 2nd half 2014– C2 1st half 2015
• Future east build out to Marcus Hook
• Marcus Hook– LPG storage– Rail, truck and pipeline
distribution system for purity C3
– Export C2, C3 & C4 capabilities
Mariner EastE/P to Marcus Hook 70 Mbpd
Mariner WestEthane to Sarnia 50 Mbpd
Sarnia
Marcus Hook
42
Standard Equipment Company Expansion
New Office & Warehouse
Vessel & Skid Shop
New Assembly ShopEngine Overhaul & Rework
2X Packaging & Overhaul Capabilities
43
PEI Power – Scranton, PA
45
• ~75 to 80 MW facility• Steam turbine ~22.5 Mw• 2 - Mercury gas turbines ~9.2 Mw• PEI II LLC - LM6000 gas turbine ~ 43 to 50 Mw
• Landfill gas fuel ~15 MMcfd ~ 500 btu\cf• 6 miles 12” pipeline to Keystone (blue)• 18 miles 16” pipeline to Alliance (red)
• Tenn Gas Pipeline 16” ~1000 btu\cf
Mercury Turbines(location)
PEI II LLC JVLM 6000 turbine
Boiler & SteamTurbine
Conclusions
46
DOE LNG ExportRequests
Approved Pending
FTA 28 for 34 Bcfd 5 for 4 Bcfd
Non-FTA 5 for 7 Bcfd 22 for 28 Bcfd
Total 33 for 38 Bcfd 27 for 35 Bcfd Plus Canada ~20 Bcfd
• The shale revolution is the key to reinventing growth and is saving our economy
• U. S. is becoming more “energy secure” vs “energy independent”
• Natural gas is abundant, clean burning and affordable
• China and India GDP expected to grow 7 to 8% driving the demand for ethylene derivativeswhile U.S. is expected to grow 2 to 3%
• Exports will continue to increase and include LNG, C2, C3, C4, diluent, naphtha, gasoline,coal (126 Mtons250 Mtons in next 2 years), polyethylene and polyvinylchloride
• Activity expected to remain strong in the big 4 plays (Bakken, Permian – stacked plays,Utica\Marcellus and Eagle Ford)
• Gas will continue to displace coal for electric generation 2 to 6 Bcfd
• New supply basins will change directional flows and basis with new emerging markets (up to 20 Bcfd)on the Gulf Coast (electric generation, industrial growth, Mexico\Canada and LNG)
• All may get approved but how many will get developed
47
Conclusions (continued)• NGL production is expected to approach 5 MMb\d plus refinery NGL’s
• Ethane will remain in oversupply with rejection of 300 to 500 Mb/d over the next several years
• New ethylene crackers, PDH plants and exports will be crucial
• Export increases are expected to keep C3 and C4 in balance
• Ethane will follow Methane prices & C3+ is expected to follow crude oil
• If LNG exports drive natural gas prices up then rigs will return to dry shale plays
• Oil to Gas ratio increases are driving U.S. competiveness (historically 6/1 now >20/1)
• Oil to Gas ratio is expected to decline slightly below 20/1 making world scale GTL plants difficultas gas prices firm due to new growing demand and oil remains backwardated
• Shale production is changing PetChem’s and Refiner’s feedstock towards lighter ends andchanging the product slate resulting in less demand for naphtha and natural gasoline
– PDH plants and Metathasis will be needed to produce propylene– Butadiene could become short– Will Europe convert from naphtha cracking to ethane or propane?
• Canada expected to need more than 1 MMb\d of diluent (pentane, hexane and some butane)
ETP’s Liquids Transformation
• Transforming from one of the largest gas transmission companies in the nation to positioning to becoming one of the largest NGL producers and liquid transporters in the nation
• Fastest growing midstream company in the Eagle Ford Shale area investing over $3B
• ETP is successfully executing it’s strategy with:
– M&A of liquid rich assets
– Organic brown field growth
– Repurposing pipelines and assets
– System integration with it’s synergistic footprint to create critical mass
– Developing new take away capacity to new emerging markets
– Extending the vertical value chain…wellhead to exports
48
Summary
49
Natural Gas Industry has a very bright future!• Shale plays are driving the U.S. economy, are a critical piece to the US energy supply chain,
and are important to ETP Midstream’s business model and future plans
• Midstream has a challenge to unlock the bottlenecks choking the growth rate of the industry. ETP is developing solutions with it’s investment in gas, NGL and crude infrastructure.
• Different producing basins have a “last mole standing” piece of infrastructure challenge and ETP is well positioned to providing services
– Marcellus-Utica – NGL takeaway
– Eagle Ford – Residue gas takeaway
– Permian & Bakken – Crude Oil takeaway
• NGL infrastructure will eventually balance with demand but there will be gaps due to pace of execution, and access to international markets will be a key value driver (“Exports” will play a crucial role)
• New natural gas demand is growing along the Gulf Coast (coal switching for electric generation, industrial growth, Mexico and LNG) and ETP is well positioned to serve these new emerging markets