Co rpo rate pre se ntatio n Cr e dit Suisse 23r d Annual E ne r - - PowerPoint PPT Presentation

SLIDE 1

Co rpo rate pre se ntatio n

Me g Ge ntle , CE O

Cr e dit Suisse 23r d Annual E ne r gy Summit

Vail , Color ado F ebr uar y 14, 2018

SLIDE 2

Cautio nar y state me nts

T he info rma tio n in this pre se nta tio n inc lude s “fo rwa rd-lo o king sta te me nts” within the me a ning o f Se c tio n 27A o f the Se c uritie s Ac t o f 1933, a s a me nde d, a nd Se c tio n 21E

• f the Se c uritie s E

xc ha ng e Ac t o f 1934, a s a me nde d. All sta te me nts o the r tha n sta te me nts o f histo ric a l fa c t a re fo rwa rd-lo o king sta te me nts. T he wo rds “a ntic ipa te ,” “a ssume ,” “b e lie ve ,” “b udg e t,” “e stima te ,” “e xpe c t,” “fo re c a st,” “initia l,” “inte nd,” “ma y,” “pla n,” “po te ntia l,” “pro je c t,” “sho uld,” “will,” “wo uld,” a nd simila r e xpre ssio ns a re inte nde d to ide ntify fo rwa rd-lo o king sta te me nts. T he fo rwa rd-lo o king sta te me nts in this pre se nta tio n re la te to , a mo ng o the r thing s, future c o ntra c ts, c o ntra c t te rms a nd ma rg ins, future c a sh flo ws a nd pro duc tio n, e stima te d ultima te re c o ve rie s a nd de live ry o f L NG, future c o sts, pric e s, fina nc ia l re sults, ra te s o f re turn, liq uidity a nd fina nc ing , re g ula to ry a nd pe rmitting de ve lo pme nts, c o nstruc tio n a nd pe rmitting o f pipe line s a nd o the r fa c ilitie s, future de ma nd a nd supply a ffe c ting L NG a nd g e ne ra l e ne rg y ma rke ts a nd o the r a spe c ts o f o ur b usine ss a nd o ur pro spe c ts. Our fo rwa rd-lo o king sta te me nts a re b a se d o n a ssumptio ns a nd a na lyse s ma de b y us in lig ht o f o ur e xpe rie nc e a nd o ur pe rc e ptio n o f histo ric a l tre nds, c urre nt c o nditio ns, e xpe c te d future de ve lo pme nts, a nd o the r fa c to rs tha t we b e lie ve a re a ppro pria te unde r the c irc umsta nc e s. T he se sta te me nts a re sub je c t to nume ro us kno wn a nd unkno wn risks a nd unc e rta intie s whic h ma y c a use a c tua l re sults to b e ma te ria lly diffe re nt fro m a ny future re sults o r pe rfo rma nc e e xpre sse d o r implie d b y the fo rwa rd-lo o king sta te me nts. T he se risks a nd unc e rta intie s inc lude tho se de sc rib e d in the “Risk F a c to rs” se c tio n o f o ur Qua rte rly Re po rt o n F

• rm 10-Q fo r the q ua rte r e nde d Se pte mb e r 30, 2017

file d with the Se c uritie s a nd E xc ha ng e Co mmissio n (the “SE C”) o n No ve mb e r 9, 2017 a nd o the r filing s with the SE C, whic h a re inc o rpo ra te d b y re fe re nc e in this pre se nta tio n. Ma ny o f the fo rwa rd- lo o king sta te me nts in this pre se nta tio n re la te to e ve nts o r de ve lo pme nts a ntic ipa te d to o c c ur nume ro us ye a rs in the future , whic h inc re a se s the like liho o d tha t a c tua l re sults will diffe r ma te ria lly fro m tho se indic a te d in suc h fo rwa rd-lo o king sta te me nts. Pla ns fo r the Pe rmia n Glo b a l Ac c e ss Pipe line a nd Ha yne sville Glo b a l Ac c e ss Pipe line pro je c ts disc usse d he re in a re in the e a rly sta g e s o f de ve lo pme nt a nd nume ro us a spe c ts o f the pro je c ts, suc h a s de ta ile d e ng ine e ring a nd pe rmitting , ha ve no t c o mme nc e d. Ac c o rding ly, the na ture , timing , sc o pe a nd b e ne fits o f tho se pro je c ts ma y va ry sig nific a ntly fro m o ur c urre nt pla ns due to a wide va rie ty o f fa c to rs, inc luding future c ha ng e s to the pro po sa ls. Altho ug h the Driftwo o d Pipe line pro je c t is sig nific a ntly mo re a dva nc e d in te rms o f e ng ine e ring , pe rmitting a nd o the r fa c to rs, its c o nstruc tio n, b udg e t a nd timing a re a lso sub je c t to sig nific a nt risks a nd unc e rta intie s. Pro je c te d future c a sh flo ws a s se t fo rth he re in ma y diffe r fro m c a sh flo ws de te rmine d in a c c o rda nc e with GAAP. T he info rma tio n o n slide s 15, 16, 24, a nd 25 is me a nt fo r illustra tive purpo se s o nly a nd do e s no t purpo rt to sho w e stima te s o f a c tua l future fina nc ia l a rra ng e me nts o r pe rfo rma nc e . T he fo rwa rd-lo o king sta te me nts ma de in o r in c o nne c tio n with this pre se nta tio n spe a k o nly a s o f the da te he re o f. Altho ug h we ma y fro m time to time vo lunta rily upda te o ur prio r fo rwa rd-lo o king sta te me nts, we disc la im a ny c o mmitme nt to do so e xc e pt a s re q uire d b y se c uritie s la ws.

Re se rve s a nd re so urc e s

E stima te s o f no n-pro ve d re se rve s a nd re so urc e s a re b a se d o n mo re limite d info rma tio n, a nd a re sub je c t to sig nific a ntly g re a te r risk o f no t b e ing pro duc e d, tha n a re e stima te s o f pro ve d re se rve s.

F

• rwa rd-lo o king sta te me nts

2 Disc la ime r

SLIDE 3

• Stra te g y: Building a lo w-c o st, g lo b a l na tura l g a s c o mpa ny

―Upstre a m pro duc tio n – 11,620 a c re s in the Ha yne sville w. ~1.4 T

c f re so urc e

―Pipe line infra struc ture de ve lo pme nt – ~$7 BN o f pipe line pro je c ts ―L

NG e xpo rt infra struc ture de ve lo pme nt – ~$15 BN o f liq ue fa c tio n pro je c ts

―L

NG ma rke ting – inte rna tio na l de live ry o f L NG c a rg o e s

• Diffe re ntia to rs

―I

nte g ra te d b usine ss mo de l

―L

• we ring c o st fo r susta ina b le de ve lo pme nt in a c o mmo ditizing ma rke t
• T
• da y’ s Pre se nta tio n . . . Ma rke t c o nte xt . . . Asse t pla ns . . . Busine ss mo de l

I ntr

• duc ing T

e llur ian (NASDAQ: T E L L )

3 Busine ss mo d e l

SLIDE 4

So urc e s: K p le r, Ma ra n Ga s, I HS, Wo o d Ma c ke nzie . No te s: L NG sto ra g e a ssume s ha lf o f fle e t is in b a lla st, 2.9 Bc f c a p a c ity p e r ve sse l. Ave ra g e c a rg o size ~2.9 Bc f, a ssuming 150,000 m3 ship . I n 2017, a p p ro xima te ly a third o f a ll L NG c a rg o e s a re e stima te d to b e sp o t vo lume s. Assume s 11% p e r a nnum d e ma nd g ro wth.

Glo bal L NG mar ke t is c o mmo ditizing

4 Glo b a l L NG

488 610

715 894 2017 2020 Bc f o f L NG sto ra g e # o f L NG ve sse ls # o f c a rg o e s lo a de d pe r da y

L e ge nd

L NG c a rrie r – la d e n L NG c a rrie r – unla d e n

L NG Stor age - 2017

Ja pa n + K

• re a te rmina ls: 633 Bc f

L NG ve sse ls: 686 Bc f

14 19

2017 2020

SLIDE 5

10 15 20 25 30 35 40 45 2001 2003 2005 2007 2009 2011 2013 2015 2017

Glo bal L NG o ve r supply is o ve r

Glo b a l L NG 5

2 4 6 8 10 12 14 16 18

2013 2014 2015 2016 2017

20 21 22 23 24 25 26 27 28 29

2013 2014 2015 2016 2017

Asia L NG impo rts Bc f/ d JK M a nnua l a ve ra g e pric e s $/ mmBtu

So urc e : Wo o d Ma c ke nzie , Pla tts, I HS.

Pr i c e si gnal s bal anc e the mar ket

Glo b a l L NG ma rke t Bc f/ d I nfra struc ture c o nstra int

SLIDE 6

$ 0 $ 2 $ 4 $ 6 $ 8 $ 10 Ja n-15 Jul-15 Ja n-16 Jul-16 Ja n-17 Jul-17 Ja n-18 $/ mmBtu Ne tb a c k fro m E uro pe Ne tb a c k fro m Asia Pla tts Gulf Co a st Ma rke r He nry Hub

Ne tb a c k pric e s to US Gulf Co a st(2)

Ne w lique fac tio n c apac ity r e quir e d

6

So urc e s: I CE via Ma rke tvie w, Wo o d Ma c ke nzie , Pla tts via CME , F e a rnle ys, T e lluria n Re se a rc h. No te s: (1) E ffe c tive c a p a c ity is d e fine d a s to ta l c a p a c ity le ss unp la nne d o uta g e s a nd g a s c o nstra ints. I mp lie d utiliza tio n ra te s a ssume d e ma nd g ro wth o f 11% p e r a nnum. (2) Histo ric a l p ric e s fro m Pla tts; ne tb a c ks b a se d o n ship p ing c o sts b a se d o n histo ric a l a nd c urre nt d a y ra te s.

Glo b a l L NG

• Ac c e le ra te d de ma nd g ro wth

drive n b y lo w L NG pric e s

• 2017 e ffe c tive c a pa c ity(1)

utiliza tio n >97%

• Hig he r pric e s sig na l ne e d fo r mo re L

NG

• E

me rg ing indic e s pro vide tra nspa re nc y L NG de ma nd g ro wth L NG c a pa c ity utiliza tio n 1% 3% 6% 11% 12%

2014 2015 2016 2017 2018

98% 97% 97% 100% 99% 101% 111%

2015 2016 2017 2018 2019 2020 2021

SLIDE 7

Dr iftwo o d L NG te r minal

No te s: (1) Be fo re o wne rs’ c o sts, fina nc ing c o sts a nd c o nting e nc ie s.

7

Driftwood L NG te rmina l L a nd

• ~1,000 a c re s ne a r L

a ke Cha rle s, L A

Ca pa c ity

• ~27.6 mtpa

T ra ins

• Up to 20 tra ins o f ~1.38 mtpa e a c h
• Cha rt he a t e xc ha ng e rs
• GE

L M6000 PF + c o mpre sso rs

Stora g e

• 3 sto ra g e ta nks
• 235,000 m 3 e a c h

Ma rine

• 3 ma rine b e rths

Ca pe x

• ~$550 pe r to nne
• ~$15.2 b illio n(1)

Ar tist r e ndition

Driftwo o d L NG

SLIDE 8

2 4 6 8 10 12 1 2 3 4 5 6 7 8 Bc f/ d

No te s: (1) L NG de ma nd inc lude s a mb ie nt c a pa c ity. (2) Inc lude s: Driftwo o d L NG, Sa b ine Pa ss L NG T 1-3, Ca me ro n L NG T 1-3, SASOL , L a ke Cha rle s CCGT , G2X Big L a ke F ue ls, L ACC – L

• tte a nd We stla ke Che mic a l.

So urc e : Co mpa ny da ta , T e lluria n e stima te s.

L o u i s i a n a Te x a s G u l f o f M e x i c o

L ake Char le s Pe tr

• c he mic al c omple x

Gillis, L A E unic e , L A

Dr iftwood L NG

8 T e lluria n Pipe line Ne two rk

Came r

• n L

NG Sabine Pass L NG 12 Bc f/ d

So uthwe st L

• uisia na firm de ma nd (1)(2)

Co re o f U.S. na tura l g a s e xpo rts

12 Bc f/ d So uthwe st L

• uisiana gas de mand

2017 2018 2019 2020 2021 2022 2023 2024

De mand tr iple s in 7 ye ar s

SLIDE 9

Ple ntiful, lo w-c o st U.S. gas e ndo wme nt

Implic a tio ns fo r the U.S. 9

Pr

• duc ti
• n gr
• wth and r

esour c e base fr

• m sel

ec ted U .S . unc onventi

• nal

basi ns

So urc e : E I A; T e lluria n a na lysis

411 112 74 23 52

Re sourc e size , T c f Ma rc e llus- Utic a Ha yne sville E a g le F

• rd

Pe rmia n Ana da rko 7.3 7.9

2017 2025

7.3 13.0

2017 2025

24.6 33.0

2017 2025

5.6 6.1

2017 2025

5.8 10.2

2017 2025

50.6 70.2 19.6

2017 2025 I nc re me nta l pro d uc tio n

T

• ta l se le c te d ba sin sha le produc tion,

Bc f/ d

SLIDE 10

I ll-suite d e xisting infr astr uc tur e

Implic a tio ns fo r the U.S. 10

Pr e-shal e pi pel i nes and i mpor t fac i l i ti es di d not c ontempl ate the shal e r evol uti

• n

So urc e : E I A; T e lluria n a na lysis

T ra ditio na lly, pipe line s ha ve mo ve d g a s fro m c o nve ntio na l pro duc ing re g io ns to c o nsuming ma rke ts in the Midwe st, No rthe a st a nd We st Co a st Ma jo r g a s tra nspo rta tio n flo ws

13

13

2008 ma jo r pipe line c o rrido r a ppro xima te c a pa c ity, Bc f/ d

3 3 1 5

6

6 15

SLIDE 11

I nfr astr uc tur e fir st wave

Implic a tio ns fo r the U.S. 11

I ndustr y bui l t new pi pel i nes, r ever sed ol d ones and devel

• ped the fi

r st wave of L NG expor t pr

• jec ts

So urc e : E I A; Wo o d Ma c ke nzie , RBN, T e lluria n a na lysis.

0.3 Bc f/ d 5.6 Bc f/ d 2.4 Bc f/ d 0.7 Bc f/ d

1.7

Curre nt L NG inve stme nt:

• ~$60 b illio n
• 9 Bc f/ d e xpo rt c a pa c ity

4.8 2.6 1.3

2.6 Comple te d pipe line re ve rsa ls a nd ne w c onstruc tion, Bc f/ d

Pipe line re ve rsa ls

L NG lique fa c tion te rmina l

Ope ra ting Unde r c o nstruc tio n

E xport c a pa c ity

Ope ra ting Unde r c o nstruc tio n

SLIDE 12

Ne w infr astr uc tur e r e quir e d

Implic a tio ns fo r the U.S. 12

13 B cf/ d of i

nc r emental pr

• duc ti
• n at r

i sk of fl ar i ng wi thout addi ti

• nal

i nfr astr uc tur e i nvestment

So urc e : E I A; ARI ; T e lluria n a na lysis No te s: (1) $1,000/ to nne a ve ra g e

• L

NG e xpo rt c a pa c ity re q uire d:

―Up to 100 mtpa : 13 Bc f/ d (20

Bc f/ d le ss ~7 unde r c o nstruc tio n)

― ~$100 b illio n(1)

• Pipe line c a pa c ity re q uire d:

―Aro und 20 Bc f/ d ―~$70 b illio n

L NG lique fa c tion te rmina l

Ope ra ting / unde r c o nstruc tio n F uture E xpo rt c a pa c ity

13 bc f/ d

6 1 8 1 Re quir e d futur e inve stme nt:

• ~$170 b illio n
• At le a st 7 Bc f/ d e xpo rt c a pa c ity

4

20 T

• ta l e stima te d 2017- 2025

produc tion g rowth, Bc f/ d

Ne w pipe line s re q uire d

SLIDE 13

Pe r mian pr

• duc tio n o utpac ing pipe line s

T e lluria n Pipe line Ne two rk

T a ke a wa y c o nstra ints in the Pe rmia n Ro lling fo rwa rd c urve o f Wa ha b a sis swa p – Ma r 18

So urc e : Blo o mb e rg , Go ldma n Sa c hs, We lls F a rg o E q uity Re se a rc h, RBN E ne rg y.

13

• 2

4 6 8 10 12 14 16 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Bc f/ d No rth Me xic o E a st We st Pe rmia n pro d uc tio n

• 1.50
• 1.00
• 0.50

0.00 No v-15 Jun-16 Ja n-17 Jul-17 F e b -18 Aug -18 Ma r-19 Oc t-19 Apr-20 No v-20 Ma y-21 $/ mmBtu Histo ric a l Ja nua ry 2018 Ma y 2016

SLIDE 14

T e llur ian Pipe line Ne two r k

No te s: (1) Inc lude d in Driftwo o d Ho lding s. (2) Curre ntly no t inc lude d in Driftwo o d Ho lding s illustra tive fina nc ia ls (slide 24); c o mme rc ia l a nd re g ula to ry in pro g re ss a nd fina nc ia l struc turing unde r re vie w.

14 T e lluria n Pipe line Ne two rk

Dr iftwood Pipe line 1

Ca pa c ity, Bc f/ d 4.0 Co st, $ b illio ns $2.2 L e ng th, mile s 96 Dia me te r, inc he s 48 Co mpre ssio n, HP 274,000 Sta tus F E RC a ppro va l pe nding

Hayne sville Global Ac c e ss Pipe line 2

Ca pa c ity, Bc f/ d 2.0 Co st, $ b illio ns $1.4 L e ng th, mile s 200 Dia me te r, inc he s 42 Co mpre ssio n, HP 23,000 Sta tus Pre limina ry ro uting

Pe r mian Global Ac c e ss Pipe line 2

Ca pa c ity, Bc f/ d 2.0 Co st, $ b illio ns $3.7 L e ng th, mile s 625 Dia me te r, inc he s 42 Co mpre ssio n, HP 258,000 Sta tus Pre limina ry ro uting

Bring ing lo w-c o st g a s to So uthwe st L

• uisia na

1 2 3 1 2 3

SLIDE 15

• T

e lluria n will o ffe r e q uity inte re st in Driftwo o d Ho lding s

• Driftwo o d Ho lding s will c o nsist o f T

e lluria n Pro duc tio n Co mpa ny, Driftwo o d Pipe line Ne two rk a nd Driftwo o d L NG te rmina l (~27.6 mtpa )

• E

quity will c ost ~$1,500 pe r tonne

• Custo me r/ Pa rtne r will re c e ive e q uity L

NG a t ta ilg a te o f Driftwo o d L NG te rmina l a t c o st

• Va r

ia ble a nd ope r a ting c osts e xpe c te d to b e ~$3.00/ mmBtu F OB (inc luding ma inte na nc e )

• T

e lluria n will r

e ta in 7 to 12 mtpa

• T

e lluria n will ma na g e a nd o pe ra te the pro je c t

Busine ss mo de l

15

T e lluria n Ma rke ting Driftwood Holding s Driftwood L NG T e rmina l Driftwood Pipe line Ne twork T e lluria n Produc tion Compa ny Custome rs

E q uity o wne rship 25% - 40% ~7-12 mtpa ~16-21 mtpa ~7-12 mtpa

Custome r/ Pa rtne r

60% - 75%

Custome rs

100%

Busine ss mo d e l

Na sda q : T E L L

SLIDE 16

• T
• ta l c o st o f ~$3/ mmBtu lo c ks in lo w c o st o f supply

$0.88 $0.36 $0.79 $0.22

$2.25

$0.75

$3.00

Drilling a nd c o mple tio n(1) Ope ra ting Ga the ring , pro c e ssing a nd tra nspo rta tio n(2) Co nting e nc y De live re d c o st L iq ue fa c tio n c o st T

• ta l

Po te ntial mar gin c aptur e fr

• m Dr

iftwo o d

So urc e s: Wo o d Ma c ke nzie , Pla tts, T ulle t Pre b o n, T e lluria n Re se a rc h. No te s: (1) Drilling a nd c o mple tio n b a se d o n we ll c o st o f $10.2 millio n, 15.5 Bc f E UR, a nd 75.00% ne t re ve nue inte re st (“NRI”) (8/ 8ths). (2) Ga the ring , pro c e ssing a nd tra nspo rta tio n inc lude s tra nspo rta tio n c o st to Driftwo o d pipe line to ma rke t. (3) Pla tts Gulf Co a st Ma rke r.

16

Upstr e am c ost

$/ mmBtu

L ique fac tion c ost

$3/ mmBtu supply c ost

• $1.50 – $15.00/ mmBtu o f ma rg in po te ntia l

Busine ss mo d e l

$0 $5 $10 $15 $20 Ja n Jul Ja n Jul Ja n Jul Ja n Jul Ja n Jul Mar 18 GCM(3) 12 F e b 2018: $7.56/ mmBtu

2013 2014 2015 2016 2017 Ne tb a c k pric e s to the Gulf Co a st $/ mmBtu

$3/ mmBtu supply c ost

SLIDE 17

Dr iftwo o d vs. c o mpe tito r s – c o st pe r to nne

So urc e s: Wo o d Ma c ke nzie , T he Wo rld Ba nk, T e lluria n Re se a rc h. No te s: (1) T he Wo rld Ba nk b a se s the L

• g istic s Pe rfo rma nc e Inde x (L

PI) o n surve ys o f o pe ra to rs to me a sure lo g istic s “frie ndline ss “ in re spe c tive c o untrie s whic h is supple me nte d b y q ua ntita tive da ta o n the pe rfo rma nc e o f c o mpo ne nts o f the lo g istic s c ha in.

17 $1,428 $1,500 $1,603 $1,654 $2,083 $2,657 $3,774 $4,144 $5,025 Qa ta r Ne w Me g a tra in Driftwo o d Mo za mb iq ue Are a 4 Ya ma l L NG Ca na da APL NG Go rg o n Whe a tsto ne I c hthys $ pe r to nne

Capac ity, mtpa

9.5 27.6 10.0 16.5 13.0 9.0 15.6 9.0 8.9

L PI global r anking (1):

3.6 4.0 2.7 2.6 3.9 3.8 3.8 3.8 3.8 Busine ss mo d e l

SLIDE 18

Catalysts

Ca ta lysts

2018 2019 Ac tivity

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Re gulator y

• Dra ft E

I S

• F

ina l E I S 10/ 12/ 18

• Sc he dule d a utho riza tio n

1/ 10/ 19 Pipe line s

• HGAP o pe n se a so n
• PGAP o pe n se a so n

Dr iftwood

• Driftwo o d e q uity syndic a tio n
• Driftwo o d F

I D

18

SLIDE 19

• L

NG de ma nd is g ro wing a t 11- 12% pe r a nnum

• Ne tb a c k L

NG pric e s to the U.S. Gulf Co a st o f > $8.00/ mmBtu ha ve sig na le d tha t a dditio na l liq ue fa c tio n c apac ity is ne e de d

• T

he U.S. is b e st po sitio ne d to me e t g lo b a l L NG supply ne e ds with a c c e ss to a b unda nt low- c ost gas a nd a tra c k re c o rd o f b uilding low- c ost

lique fac tion

• ~$170 Bn a dditio na l U.S. infr

astr uc tur e is r e quir e d to c o nne c t supply with

g ro wing g lo b a l de ma nd

• T

e lluria n’ s b usine ss mo de l is de sig ne d to pro vide inve sto rs with a c c e ss to the U.S. inte g ra te d va lue c ha in c a pa b le o f pro viding low- c ost, fle xible L

NG globally

Co nc lusio ns

So urc e : Kple r

19 Co nc lusio ns

SLIDE 20

Co ntac t us

• Amit Mar

waha

Dire c to r, I nve sto r Re la tio ns & F ina nc e +1 832 485 2004 a mit.ma rwa ha @ te lluria ninc .c o m

• Joi L

e c znar

SVP, Pub lic Affa irs & Co mmunic a tio n +1 832 962 4044 jo i.le c zna r@ te lluria ninc .c o m @ T e lluria nL NG

20 Co nta c ts

SLIDE 21

2017

Additio nal de tail

SLIDE 22

$25 millio n $60 millio n $207 millio n Me rg e r $100 millio n Upstre a m Ac q uisitio n L ST K

F e br uar y Apr il August De c e mbe r Januar y F e br uar y June Nove mbe r De c e mbe r

Cha rif So uki a nd Ma rtin Ho usto n e sta b lish T e lluria n Ma na g e me nt, frie nds a nd fa mily inve st $60 millio n Me g Ge ntle jo ins to le a d the c o mpa ny a s Pre side nt & CE O GE inve sts $25 millio n in T e lluria n T OT ALinve sts $207 millio n in T e lluria n Me rg e d with Ma g e lla n Pe tro le um, g a ining a c c e ss to pub lic ma rke ts Be c hte l, Cha rt I ndustrie s a nd GE c o mple te the fro nt-e nd e ng ine e ring a nd de sig n (F E E D) study fo r Driftwo o d L NG Ac q uire d Ha yne sville a c re a g e , pro duc tio n a nd ~1.4 T c f E xe c ute d L ST K E PC c o ntra c t with Be c hte l fo r ~$15 b illio n Ra ise d a ppro xima te ly $100 millio n pub lic e q uity

2017 2016

Cr e ating T e llur ian (NASDAQ: T E L L )

22 Intro d uc tio n

SLIDE 23

Building a lo w-c o st glo bal gas busine ss

23

Pipe line L iq ue fa c tio n Ma rke ting Upstre a m

• Purc ha se lo w-c o st g a s a t

liq uidity po ints o r a s re se rve s

• Dive rsify g a s supply
• De ve lo p pipe line so lutio ns

fo r c o nstra ine d pro duc tio n b a sins

• Ma ximize a c c e ss to supply

liq uidity

• De ve lo p lo w-c o st

liq ue fa c tio n

• ~$550 pe r to nne
• De ve lo p suite o f fle xib le

L NG pro duc ts

• Build o ut risk ma na g e me nt

a nd o pe ra tio na l infra struc ture

• L

NG tra de e ntry in 2017

• Ac q uire d 11,620 ne t a c re s

with up to 178 drilling lo c a tio ns a nd 1.4 T c f to ta l ne t re so urc e in Ha yne sville

• De live re d g a s c o st

$2.25/ mmBtu

• F

E RC pe rmit pe nding fo r Driftwo o d Pipe line

• De ve lo ping T

e lluria n Pipe line Ne two rk

• ~27.6 mtpa Driftwo o d

L NG te rmina l

• F

E E D c o mple te

• L

ST K E PC e xe c ute d fo r $15.2 b illio n

• F

E RC pe rmit pe nding

• E

xpe rie nc e d g lo b a l ma rke ting te a m

• Offic e s in Ho usto n,

Wa shing to n D.C., L

• ndo n,

a nd Sing a po re

• Ma ra n Ga s Mystra s L

NG ve sse l unde r 6 mo nth time c ha rte r

Busine ss mo d e l

SLIDE 24

I llustr ative financ ials

Busine ss mo d e l 24

No te s: (1) Pha se 1 o f the E PC a g re e me nt re fle c ts 2 pla nts, 1 b e rth, a nd 2 ta nks; full de ve lo pme nt re fle c ts 5 pla nts, 3 b e rths, a nd 3 ta nks. (2) Re so urc e ne e d fo r 30 ye a r pe rio d. (3) Drilling c a pita l e xpe nditure s o f $3.4 b illio n, ne t o f $2.2 b illio n o f g a s sa le s. (4) Ca sh flo ws c a lc ula te d a s T e lluria n c a pa c ity (3 mtpa ) multiplie d b y 52 mmBtu pe r to nne multiplie d b y Custo me r ma rg in. (5) Pe r sha re a mo unts b a se d o n 224 millio n sha re s o utsta nding a s o f De c e mb e r 15, 2017 (214 millio n sha re s a s o f De c e mb e r 7, 2017 a s re po rte d in pro spe c tus supple me nt file d o n De c e mb e r 11, 2017 a nd a n a dditio na l 10 millio n sha re s issue d in De c e mb e r 2017).

Sc e na rio Pha se 1(1) F ull de ve lopme nt(1) Ca pa c ity, mtpa 11.0 27.6

Upstre a m re so urc e ne e d (2), T c f ~15 ~40

Inve stme nt, $ billions

― T

e rmina l a nd S&U $ 7.6 $ 15.2

― Pipe line

$ 1.1 $ 2.2

― Owne r's c o sts a nd o the r

$ 1.1 $ 2.1

― Upstre a m – a c q uisitio n

$ 1.0 $ 2.0

― Upstre a m – drilling c a pe x (ne t o f sa le s)(3)

$ 1.2 $ 2.5

T

• ta l

$ 12.0 $ 24.0 T ra nsa c tion pric e , $ pe r tonne $1,500 $1,500 Ca pa c ity split

mtpa

%

mtpa

%

─ Custo me r/ Pa rtne r

8.0 72% 16.0 58%

─ T

e lluria n 3.0 28% 11.6 42% L NG sa le pric e , $/ mmBtu $ 6.00 $ 10.00 $ 15.00 $ 6.00 $ 10.00 $ 15.00 Custo me r ma rg in, $/ mmBtu $ 3.00 $ 7.00 $ 12.00 $ 3.00 $ 7.00 $ 12.00 T e lluria n a nnua l c a sh flo ws, $ millio ns(4) $ 470 $ 1,090 $ 1,870 $ 1,810 $ 4,220 $ 7,240 T e lluria n a nnua l c a sh flo ws pe r sha re (5), $ $ 2.10 $ 4.90 $ 8.35 $ 8.10 $ 18.85 $ 32.30

SLIDE 25

Re tur n o n $1,500 pe r to nne inve stme nt

25 Busine ss mo d e l

2 4 6 8 10

Pa yba c k pe riod a na lysis(6)

Ye a rs to re c o ve r c a pita l

$0 $(1,500)

Cumula tive c a sh flo w $ millio ns

$10/ mmBtu $6/ mmBtu Ne tb a c k F OB U.S. Gulf Co a st

4 10

No te s: (1) E q uiva le nt to F OB pric e a t U.S. Gulf Co a st. (2) Assuming $3/ mmBtu c o st o f L NG. (3) Assuming liq ue fa c tio n c a pa c ity o f 1.0 mtpa a nd e ne rg y c o nve rsio n o f 52 mmBtu pe r to nne . (4) Inve sto r c a shflo w pe r to nne (fro m (3) a b o ve ) divide d b y $1,500 pe r to nne inve stme nt. (5) IRR c a lc ula te d o ve r 20 ye a rs a fte r inve stme nt pe rio d b e fo re fe de ra l inc o me ta x, a nd inc luding a te rmina l va lue b a se d o n a c a p ra te o f 8.0%. (6) Pa yb a c k b a se d o n implie d ma rg in pe r unit, fe de ra l inc o me ta xe s a re no t inc lude d; a ssume s $3/ mmBtu c o st o f pro duc tio n a nd sing le c usto me r inve stme nt o f $1,500 millio n.

U.S. Gulf Coa st ne t ba c k pric e (1), $/ mmBtu $ 6.00 $ 10.00 $ 15.00

Driftwo o d L NG, F OB U.S. Gulf Co a st $ (3.00) $ (3.00) $ (3.00) Ma rg in

(2), $/ mmBtu

$ 3.00 $ 7.00 $ 12.00 Annua l Custo me r/ Pa rtne r c a shflo ws

(3), $ pe r to nne

$ 156 $ 364 $ 624 Ca sh o n c a sh re turn

(4)

10% 24% 42% Unle ve re d I RR

(5)

9% 18% 26%

SLIDE 26

I nte gr ate d mo de l pr e vale nt inte r natio nally

So urc e : IHS.

26

Proje c ts inc lude :

Austra la sia

APL NG, Da rwin, GL NG, Go rg o n, Ic hthys, NWS, Pluto , No rthwe st She lf, QCL NG, Whe a tsto ne , PNG L NG, T a ng g uh, Brune i L NG, Do ng g i-Se no ro , ML NG, Ya ma l L NG

Mide a st/ Afric a

Ang o la L NG, E G L NG, Da mie tta , E L NG, Ye me n L NG, Mo za mb iq ue L NG, Co ra l L NG, Oma n L NG, Qa lha t L NG, Qa ta rg a s I-I V, Ra sGa s I-I I I , ADGAS

Ame ric a s

Atla ntic L NG, Pe ru L NG, L NG Ca na da

E uro pe

Sno hvit, Ya ma l L NG

E ur

• pe

Austr a la sia NOC IOC

Busine ss mo d e l

SLIDE 27

• 12

24 36 48

Sa b ine Ca me ro n Co ve Po int Co rpus So uthe rn F re e po rt DWL NG Ma g no lia Go lde n Pa ss L a ke Cha rle s Ve nture Glo b a l Pre -filing F E RC a pplic a tio n

Dr iftwo o d sc he dule

Driftwo o d L NG

No te s: (1) Pro je c ts unde r E nviro nme nta l Asse ssme nt (E A), a ll o the r pro je c ts re q uire d a n E nviro nme nta l Impa c t Sta te me nt (E IS), whic h e nta ils a lo ng e r re vie w pro c e ss with the F E RC.

27

Se c ond wave F ir st wave

Ca ta lyst E stima te d time line

Dra ft E nviro nme nta l I mpa c t Sta te me nt 1H 2018 F ina l E nviro nme nta l I mpa c t Sta te me nt 12 Oc to b e r 2018 F E RC o rde r a nd F e de ra l Autho riza tio n De a dline 10 Ja nua ry 2019 Driftwo o d fina l inve stme nt de c isio n 1H 2019 Be g in c o nstruc tio n 1H 2019 Be g in o pe ra tio ns 2023

Mo nths

1 1 1

SLIDE 28

$700 pe r to nne $490 $500 $380

~$550

K e y te rms o f E PC a g re e me nts with Be c hte l

Ad d itio na l d e ta il 28

Pha se 1 Pha se 2 Pha se 3 Pha se 4 T

• ta l

11.0

5.5 5.5 5.5

27.6

T ra ins 8 4 4 4 20 Sto ra g e fa c ilitie s 2 1 3 Be rths 1 1 1 3

Ca pa c ity

SLIDE 29

T e llur ian Pipe line Ne two r k

29

Gillis Ma rke t Are a

• KMPL
• T

E T CO

• T

runkline

• T

ra nsc o

• T

e nn Ga s

• CT

PL

• Ca me ro n
• F

GT

• DWPL
• E

GAN

• T

e xa s Ga s

• Pine Pra irie
• ANR
• CGT

Inte r c onne c ts

Pe rmia n Supply Are a

• E

T C –Co ma nc he T ra il

• E

T C – T ra ns-Pe c o s

• E

T C – Oa sis

• Va q ue ro
• One OKWe sT

e x

• OXY
• E

nte rprise

• Ja l
• E

l Pa so

• White Wa te r
• NGPL
• No rthe rn Na tura l

Ga s

• T

ra nsWe ste rn

• Atmo s

Inte r c onne c ts

Ha yne sville Supply Are a

• Cro sste x
• Re g e nc y (RIGS)
• Ac a dia n
• ME

P

• Gulf Cro ssing
• Ce nte rPo int
• T

e lluria n Pro duc tio n Co .

• T

e nn Ga s

• E

T C – T ig e r

• T

e xa s Ga s

• Gulf So uth

Inte r c onne c ts

Pr

• pose d pipe line s

DWPL DWPL inte rc o nne c ts

Ad d itio na l d e ta il

Pr

• pose d pipe line s

PGAP PGAP inte rc o nne c ts Pr

• pose d pipe line s

HGAP HGAP inte rc o nne c ts

SLIDE 30

T e llur ian Pr

• duc tio n Co mpany
• Ac q uire a nd de ve lo p long life , low- c ost na tura l

g a s re sourc e s

― L

• w g e o lo g ic a l risk

― Sc a la b le po sitio n ― Pro duc tio n o f ~1.5 Bc f/ d sta rting in 2022 ― T

• ta l re so urc e s o f ~15 T

c f fo r Pha se 1

― Ope ra to rship ― L

• w o pe ra ting c o sts

― F

le xib le de ve lo pme nt

• I

nitia lly fo c use d o n Ha yne sville b a sin; in c lo se pro ximity to sig nific a nt de ma nd g ro wth, lo w de ve lo pme nt risk, a nd fa vo ra b le e c o no mic s

• T

a rg e t is to de live r g a s fo r $2.25/ mmBtu

• T

e lluria n a c q uire d 11,620 ne t a c re s in the Ha yne sville sha le fo r $87.8 million in Q4 2017

• Prima rily lo c a te d in De So to a nd Re d Rive r pa rishe s
• 80% HBP
• 94% o pe ra te d
• 100% g a s
• Curre nt pro duc tio n – 4 mmc f/ d
• Ope ra te d pro duc ing we lls – 19
• I

de ntifie d de ve lo pme nt lo c a tio ns – ~178

• T
• ta l ne t re so urc e – ~1.4 T

c f

T e lluria n Pro d uc tio n Co mpa ny

Ob je c tive s Ac q uisitio ns

30

SLIDE 31

Hayne sville type c ur ve c o mpar iso n

Co mpa ra tive type c urve sta tistic s Cumula tive pro duc tio n no rma lize d to 7,500’ (3)

So urc e : Co mpa ny inve sto r pre se nta tio ns. No te s: (1) Assume s 75.00% ne t re ve nue inte re st (“NRI”) (8/ 8ths). (2) Assume s g a s pric e s o f $3.00/ mc f b a se d o n NRI a nd re turns pub lishe d spe c ific to e a c h o pe ra to r Do e s no t inc lude le a se a c q uisitio n o r c o rpo ra te o ve rhe a d c o sts. (3) 7,500’ e stima te d ultima te re c o ve ry (“E UR”) = o rig ina l la te ra l le ng th E UR + ((7,500’ -o rig ina l la te ra l le ng th) * 0.75 * (o rig ina l la te ra l le ng th E UR / o rig ina l la te ra l le ng th)).

31

0.0 1.0 2.0 3.0 4.0 5.0 6.0 30 60 90 120 150 180 210 240 270 300 Bcf Days

Peer B Peer D Peer A Peer C Tellurian T e lluria n Pe e r A Pe e r B Pe e r C Pe e r D T ype c urve de ta il Are a De So to / Re d Rive r No rth L

• uisia na

De So to NL A De So to c o re NL A c o re / b le nde d de ve lo pme nt pro g ra m Co mple tio n (lb s. / ft.)

• 4,000

3,800 2,700 3,000

Sing le we ll sta ts

L a te ra l le ng th (ft.) 6,950' 7,500' 7,500' 4,500' 9,800' Gro ss E UR (Bc f) 15.5 18.8 18.6 9.9 19.9

E UR pe r 1,000' ft. (Bc f) 2.20 2.50 2.48 2.20 2.03

Gro ss D&C ($ millio ns) $10.20 $10.20 $8.50 $7.70 $10.30 F &D ($/ mc f)(1) $0.88 $0.73 $0.61 $1.04 $0.69

T ype c urve e c onomic s

Be fo re -ta x I RR (%)(2) 43% 60% 90%+ 54%

• Ad d itio na l d e ta il