CAPP Scotiabank Investment Symposium A p r i l 1 1 , 2 0 1 7 - - PowerPoint PPT Presentation

CAPP Scotiabank Investment Symposium

A p r i l 1 1 , 2 0 1 7

In the interests of providing Keyera Corp. (“Keyera” or the “Company”) shareholders and potential investors with information regarding Keyera, including Management’s assessment of future plans and operations relating to the Company, this document contains certain statements and information that are forward-looking statements or information within the meaning of applicable securities legislation, and which are collectively referred to herein as “forward-looking statements". Forward-looking statements in this document include, but are not limited to statements and tables with respect to: capital projects and expenditures; strategic initiatives; anticipated producer activity and industry trends; and anticipated performance. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward- looking statements involve numerous assumptions, as well as known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur and which may cause Keyera’s actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by the forward-looking statements. These assumptions, risks and uncertainties include, among other things: Keyera’s ability to successfully implement strategic initiatives and whether such initiatives yield the expected benefits; future operating results; fluctuations in the supply and demand for natural gas, NGLs, crude oil and iso-octane; assumptions regarding commodity prices; activities of producers, competitors and others; the weather; assumptions around construction schedules and costs, including the availability and cost of materials and service providers; fluctuations in currency and interest rates; credit risks; marketing margins; potential disruption or unexpected technical difficulties in developing new facilities or projects; unexpected cost increases or technical difficulties in constructing or modifying processing facilities; Keyera’s ability to generate sufficient cash flow from

• perations to meet its current and future obligations; its ability to access external sources of debt and equity capital; changes in laws or

regulations or the interpretations of such laws or regulations; political and economic conditions; and other risks and uncertainties described from time to time in the reports and filings made with securities regulatory authorities by Keyera. Readers are cautioned that the foregoing list of important factors is not exhaustive. The forward-looking statements contained in this document are made as of the date of this document or the dates specifically referenced herein. For additional information please refer to Keyera’s public filings available on SEDAR at www.sedar.com. All forward-looking statements contained in this document are expressly qualified by this cautionary statement.

Disclaimer

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Conservative Financial Strategy

1 Compound annual growth rate from 5/30/2003 to 12/31/2016. 2 Compound annual growth rate from 7/15/2003 to 3/31/2017. 3 Based on dividends declared. Not a standard measure under GAAP. 4 From 1/1/2016 to 12/31/2016, inclusive.

%

cagr

distributable cash flow per share 1,3

%

cagr

dividend per share 2,3

%

LTM payout ratio 3,4 3

Focused On Growing Shareholder Value

Investment Opportunities Continue

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$600-$700 Million of Growth Capital Spending in 2017

1 Estimated growth capital for 2017 includes the pipeline acquisition cost of the South Grand Rapids project payable by Keyera upon completion of construction in 2H17. The acquisition capital in 2017 reflects

the $55 million purchase price for undeveloped land in the Industrial Heartland of Alberta completed in 1Q17.

$- $200 $400 $600 $800 $1,000 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17e Millions

ANNUAL CAPITAL EXPENDITURES

Growth Capital Upper End of Growth Capital Range Acquisitions Maintenance Capital

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Gathering and Processing Business Unit

Well maintained, long-life facilities

– ~2.9 bcf/d licensed gross capacity1 – 17 active gas plants; 15 operated by Keyera

Extensive gathering systems

– Significant gathering pipelines tied into existing gas plants – >5,000 kilometres of pipelines operated by Keyera – Capture areas create franchise regions

Fee-for-service revenues with negligible direct commodity exposure

– Largely flow-through operating costs

Network of Facilities Supported by Fee-for-Service Contracts

• 1. Licensed capacity is not equivalent to actual operating capacity. Actual operational capacity can be lower as it depends on
• perating conditions and capabilities of functional units at each plant.

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Simonette Liquids Handling Expansion Project

Significant Opportunities for Future Development

Enables Keyera to handle growing volumes of condensate and improve liquids recoveries for customers Facilities include above-ground storage, truck loading, redesigned existing condensate stabilization and other new services Upon completion by mid-2018 for an estimated cost of $100 million, condensate handling capacity is expected to be ~27,000 bbls/d1

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1 Project cost and timing is subject to finalization of scope, cost estimates and construction schedule variables.

Wapiti Area Gathering & Processing Complex

Increasing Keyera’s Presence in the Montney

1 Project cost and timing subject to project sanctioning, finalization of scope, timely receipt of remaining regulatory approvals and construction schedule variables.

Proposed sour Montney gas gathering and processing complex:

̶ Keyera acquired the Wapiti plant site and a successfully tested acid-gas injection well in 2016 ̶ Producer entered into a long-term gas handling agreement including an area dedication and take-or-pay commitment, subject to a final sanctioning decision at any time prior to the end of 2018

Proposed facilities include:

̶ Plant with up to 300 mmcf/d of sour gas processing capacity and up to 25,000 bbls/d of condensate handling capacity ̶ Acid gas injection ̶ Raw gas gathering and field compression system

Estimated total project cost of ~$625 million with a target in-service date of mid-20191

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Producers active in the Wapiti area:

• Apache
• CNRL
• Conoco
• Encana
• NuVista
• Paramount
• Seven Generations
• Shell
• Sinopec-Daylight

Future potential to connect the plant to Keyera’s Wapiti pipeline and Simonette gas plant

Liquids Business Unit

e t h a ne p r o p a n e c o n d en sat e B U T A N E

ABOVE GROUND BELOW GROUND

~2300

AEF

ISO-OCTANE (13,600 bbls/d)

FRACTIONATION STORAGE SPEC PRODUCT TRANSPORTATION MARKETING

Unmatched Infrastructure for NGL and Oil Sands Customers

~13.2 million bbls of gross cavern capacity ~90,000 bbls/d of net fractionation capacity at five locations Rail and truck terminals and pipelines transporting variety

• f NGLs

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>520,000 bbls of gross w orking tank capacity

NGL MIX TRANSPORTATION

An Integrated NGL Transportation Solution

Keylink NGL Gathering Pipeline System

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New NGL gathering solution for liquids egress and network integration:

– NGL gathering pipeline system strengthens Keyera’s value chain by connecting eight Keyera gas plants to the Rimbey energy complex – NGLs can be fractionated at Rimbey or at Keyera Fort Saskatchewan (via Rimbey Pipeline and the FSPL system) – Capacity of ~22,000 bbls/d1 – Combination of new and re-purposed existing pipelines with a total system length of 264 km1 – Estimated cost of $147 million, with an expected in-service date of mid-20181

1 Capacity, length, cost and timing subject to finalization of scope, timely receipt of third party consent and remaining regulatory approvals and construction schedule variables.

Expanding Underground Storage at KFS

Continued Growth at the Fort Saskatchewan Energy Complex

Underground storage capacity expansion project:

– 14th cavern washing completed in 4Q16; recently brought online1 – 15th cavern currently being washed; expected in-service in 1H181 – Drilled well bores for 16th and 17th caverns in 3Q16; washing

• f the 16th cavern commenced

in 1Q17

Net cost of four-cavern underground storage development program is approximately $90 million

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1 Timing subject to receipt of remaining regulatory approvals and, in the case of cavern 15, completion of washing at the expected pace.

Extensive, Flexible Condensate Infrastructure

Most connected condensate hub in Western Canada Major oil sands delivery options: Supply through multiple receipt points: – Local fractionators and refineries – Kinder Morgan Cochin pipeline – Enbridge Southern Lights pipeline and CRW pool – Western Canada feeder pipelines – Rail imports at the Alberta Diluent Terminal Storage at Keyera Fort Saskatchewan Long-term take-or-pay and fee-for-service agreements: – Imperial Oil (Kearl) – Husky/BP (Sunrise) – Suncor/Teck/Total (Fort Hills) – North West Upgrading – Cenovus (Christina Lake) – CNRL (Kirby, Primrose) – JACOS/Nexen (Hangingstone) – Devon (Jackfish)

Industry-Leading Diluent Handling Services

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– Polaris – Norlite

Keyera’s Condensate Network

– Access – FSPL – Grand Rapids – South Cheecham

Multi-Purpose Terminals Across Alberta

Transporting Commodities Between Regional Markets

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Josephburg Rail Terminal

22,400 bbls/d rail capacity1,2

Alberta Crude Terminal

40,000 bbls/d gross rail capacity (20,000 bbls/d net)1

Alberta Diluent Terminal

50,000 bbls/d rail capacity1 & 342,600 bbls storage capacity

South Cheecham Rail & Truck Terminal

24,000 bbls/d gross rail loading capacity (12,000 bbls/d net)1 15,000 bbls/d gross rail offloading capacity (7,500 bbls/d net)1 51,000 bbls storage capacity (25,500 bbls net)

Keyera Edmonton Terminal

34,000 bbls/d rail capacity1 240,000 bbls of storage capacity (under construction)

1 Rail capacity is an estimated calculation taking into account such factors as the number of railcar spots at each facility, the frequency of switches provided by the railways at each facility and the type of product being loaded or off-loaded. 2 The capacity identified for the Josephburg Rail Terminal is based on the facility operating 12 hours per day, should the hours of operation increase, the capacity would also increase.

Undeveloped Land for Future Growth

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Strategic Optionality in the Industrial Heartland of Alberta

Close proximity to pipelines and railroads Keyera holds salt rights beneath most of these lands 166 undeveloped acres 1290 undeveloped acres 132 undeveloped acres

Keyera Josephburg Terminal (KJT) Keyera Fort Saskatchewan (KFS)

350 undeveloped acres

Keyera’s Hull Terminal in Texas

Rail, truck and pipeline terminal handles NGL mix, propane, butane and iso-butane Acquired a 88-kilometre, 6-inch pipeline system for US$24 million in 2016 Reactivating and connecting the pipeline system for an estimated cost (incl. third party connection) of US$20-25 million1 Proposed third-party pipeline connection will provide access to Mont Belvieu:

• Agreement with a major US midstream company to

build the connection signed in 4Q16

• Commercial terms secure storage and other

midstream services in Mont Belvieu post- construction

Hull Terminal and Pipeline System

Enhancing Keyera’s Access to Mont Belvieu

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1 Cost and timing subject to finalization of scope for pipeline connections and other improvements, construction and schedule variables.

Proposed system flow by 2018

Investment Summary

1 Total return includes the simple receipt of dividends paid by Keyera and the TSX between May 30, 2003 and March 31, 2017, but not the reinvestment of dividends in any assumed security. 2 Distributable cash flow is not a standard measure under GAAP. See Keyera’s 2016 Year End Report MD&A for a definition of distributable cash flow and for a reconciliation of distributable cash flow to its related GAAP

• measure. 3 Payout ratio is not a standard measure under GAAP. Payout ratio is defined as dividends declared to shareholders divided by distributable cash flow.

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Providing Growth and Income for Shareholders

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% $- $0.25 $0.50 $0.75 $1.00 $1.25 $1.50 $1.75 $2.00 $2.25 $2.50 $2.75 $3.00 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Payout Ratio Per Share (split-adj.)

DISTRIBUTABLE CASH FLOW, PAYOUT RATIO & DIVIDENDS PER SHARE

Distributable Cashflow per Share Payout Ratio Dividends per Share

2 3

$100 $300 $500 $700 $900 $1,100

TOTAL RETURN OF A $100 INVESTMENT IN KEYERA and THE S&P/TSX COMPOSITE INDEX

TSX Total Return Keyera Total Return

1

A Well Positioned Midstream Company

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Operational and Financial Flexibility

diversified customer base & service

• ffering

strong balance sheet & low payout ratio Alberta EnviroFuels iso-octane business industry leading condensate system NGL fractionation & cavern storage capacity networked gas plants & gathering systems

Lavonne Zdunich, CA Director, Investor Relations & Communications Nick Kuzyk, MBA Manager, Investor Relations 888-699-4853 ir@keyera.com

Contact Information

Keyera Corp.

144 4 Avenue SW Suite #200 - West Tower Calgary, Alberta T2P 3N4

www.keyera.com

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