Presentation March 2-4, 2015 Strong. Innovative. Growing. 1 - - PowerPoint PPT Presentation

Investor Presentation

March 2-4, 2015

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• Strong. Innovative. Growing.

Forward-Looking Statements

This presentation contains forward-looking statements within the meaning of the federal securities laws. Although these statements reflect the current views, assumptions and expectations of our management, the matters addressed herein involve certain risks and uncertainties that could cause actual activities, performance, outcomes and results to differ materially than those indicated. Such forward-looking statements include, but are not limited to, statements about future financial and

• perating results, guidance, projected or forecasted financial results, objectives, project timing, expectations and intentions and
• ther statements that are not historical facts. Factors that could result in such differences or otherwise materially affect our

financial condition, results of operations and cash flows include, without limitation, (a) the dependence on Devon for a substantial portion of the natural gas that we gather, process and transport, (b) our lack of asset diversification, (c) our vulnerability to having a significant portion of our operations concentrated in the Barnett Shale, (d) the amount of hydrocarbons transported in our gathering and transmission lines and the level of our processing and fractionation operations, (e) fluctuations in oil, natural gas and NGL prices, (f) construction risks in our major development projects, (g) our ability to consummate future acquisitions, successfully integrate any acquired businesses, realize any cost savings and other synergies from any acquisition, (h) changes in the availability and cost of capital, (i) competitive conditions in our industry and their impact on our ability to connect hydrocarbon supplies to our assets, (j) operating hazards, natural disasters, weather-related delays, casualty losses and other matters beyond our control, (k) a failure in our computing systems or a cyber-attack on our systems, and (l) the effects of existing and future laws and governmental regulations, including environmental and climate change requirements and other uncertainties. These and other applicable uncertainties, factors and risks are described more fully in EnLink Midstream Partners, LP’s and EnLink Midstream, LLC’s filings with the Securities and Exchange Commission, including EnLink Midstream Partners, LP’s and EnLink Midstream, LLC’s Annual Reports on Form 10-K, Quarterly Reports on Form 10- Q and Current Reports on Form 8-K. Neither EnLink Midstream Partners, LP nor EnLink Midstream, LLC assumes any

• bligation to update these forward-looking statements. The assumptions and estimates underlying the forecasted financial

information included in the guidance information in this press release are inherently uncertain and, though considered reasonable by the EnLink Midstream management team as of the date of its preparation, are subject to a wide variety of significant business, economic, and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the forecasted financial information. Accordingly, there can be no assurance that the forecasted results are indicative of EnLink Midstream’s future performance or that actual results will not differ materially from those presented in the forecasted financial information. Inclusion of the forecasted financial information in this press release should not be regarded as a representation by any person that the results contained in the forecasted financial information will be achieved.

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Non-GAAP Financial Information

This presentation contains non-generally accepted accounting principle financial measures that we refer to as adjusted EBITDA, distributable cash flow, gross operating margin, growth capital expenditures, adjusted EBITDA of EnLink Midstream Holdings (EMH) and maintenance capital expenditures. We define adjusted EBITDA as net income from continuing operations plus interest expense, provision for income taxes, depreciation and amortization expense, impairment expense, stock-based compensation, gain on noncash derivatives, transaction costs, distribution of equity investment and non-controlling interest and income on equity investment. We define distributable cash flow as net cash provided by operating activities plus adjusted EBITDA, net to EnLink Midstream Partners, LP less interest expense, litigation settlement adjustment, interest rate swap, cash taxes and other, maintenance capital expenditures and Predecessor adjusted EBITDA. Gross operating margin is defined as revenue minus the cost of purchased gas, NGL, condensate and crude oil. Growth capital expenditures are defined as all construction-related direct labor and material costs, as well as indirect construction costs including general engineering costs and the costs of funds used in

• construction. Adjusted EBITDA of EMH is defined as earnings plus depreciation, provisions for income taxes and

distribution of equity investment less income on equity investment. The amounts included in the calculation of these measures are computed in accordance with generally accepted accounting principles (GAAP) with the exception of maintenance capital expenditures. Maintenance capital expenditures are capital expenditures made to replace partially or fully depreciated assets in order to maintain the existing operating capacity of the assets and to extend their useful lives. The Partnership and General Partner believe these measures are useful to investors because they may provide users of this financial information with meaningful comparisons between current results and prior-reported results and a meaningful measure of the Partnership’s and the General Partner's cash flow after it has satisfied the capital and related requirements of its operations.

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Our Strategy: Stability Plus Growth

A Stable Investment in the MLP Space

Stability of cash flows

• ~95% fee-based contracts
• ~50% of gross operating margin from long-term Devon contracts

Top tier midstream energy service for our customers Leverage Devon Energy sponsorship for growth

• Expect significant growth from dropdowns
• Serve Devon E&P portfolio in its growth areas

Strong organic growth

• South Louisiana, West Texas and Ohio River Valley (ORV) expansion projects

Top tier balance sheet

• Investment grade credit rating at ENLK since inception
• Strong liquidity with a new $1.5 billion credit facility

The Vehicle for Sustainable Growth:

Strategically Located and Complementary Assets

Gathering and Transportation

• ~8,800 miles of gathering and

transmission lines

• 11 Bcf of natural gas storage capacity

Gas Processing

• 13 plants with 3.4 Bcf/d of total

net inlet capacity

NGL Transportation, Fractionation and Storage

• ~600 miles of liquids transport line
• 7 fractionation facilities with

280,000 Bbl/d of total capacity

• 3.2 MMBbl of underground NGL storage

Crude, Condensate and Brine Handling

• 200 miles of crude oil pipeline
• Barge and rail terminals
• 500,000 Bbl of above ground storage
• 100 vehicle trucking fleet
• 8 brine disposal wells
• 6 condensate stabilization & gas

compression stations in service

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EnLink Midstream Partners, LP Master Limited Partnership

NYSE: ENLK (BBB / Baa3)

EnLink Midstream, LLC General Partner

NYSE: ENLC

Public Unitholders

~70% ~30% ~1% GP ~18% LP

EnLink Midstream Holdings

(formerly Devon Midstream Holdings) ~44% LP ~37% LP

Devon Energy Corp.

NYSE: DVN (BBB+ / Baa1) GP + 75% LP

The Vehicle for Sustainable Growth:

MLP Structure with a Premier Sponsor

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Dist./Q Split Level < $0.2500 2% / 98% < $0.3125 15% / 85% < $0.3750 25% / 75% > $0.3750 50% / 50% Current Position ENLC owns 100% of IDRs ~25% LP

Sustainable Growth Substantial Scale & Scope Diverse, Fee-Based Cash Flow Strong B/S & Credit Profile

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• Investment grade balance sheet at ENLK (BBB, Baa3)
• Debt / EBITDA of ~3.3x
• Strong liquidity with new $1.5 billion credit facility
• ~ 95% fee-based margin
• Balanced cash flow (Devon ~50%)
• Projects focused on NGL/crude and rich gas processing
• Total consolidated enterprise value of ~$14 billion
• Projected 2015 Combined Adjusted EBITDA: ~$740 MM
• Geographically diverse assets with multi-commodity exposure
• Stable base cash flow supported by long-term contracts
• Organic growth opportunities through Devon’s upstream portfolio
• Expect significant growth from drop downs

Louisiana

The Vehicle for Sustainable Growth:

Well Positioned with a Strong Balance Sheet

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EnLink Midstream Consolidated 2015 Guidance

Adjusted EBITDA $740 MM % of Gross Operating Margin from fee-based contracts ~ 95%

EnLink Midstream Partners, LP (ENLK) 2015 Guidance

Adjusted EBITDA ~ $710 MM Distributable Cash Flow ~ $570 MM ENLK annual distributions per unit ~ $1.58 ENLK annual distribution growth rate from 2014 to 2015 ~ 7.5% Announced acquisitions (not including drop downs) ~ $700 MM Growth capital expenditures ~ $500 MM Maintenance capital expenditures ~ $50 MM

EnLink Midstream, LLC (ENLC) 2015 Guidance

Cash Taxes ~ $20 MM ENLC annual distributions per unit ~ $1.025 ENLC distribution growth from 2014 to 2015 ~18.5%

Note: Adjusted EBITDA, gross operating margin, distributable cash flow, growth capital expenditures and maintenance capital expenditures are non-GAAP financial measures and are explained on page 3.

2015 Guidance:

Stability Plus Growth

The Four Avenues for Growth

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Avenue 1: Drop Downs Organic Growth Projects

The Four Avenues for Growth

Progress in Last Nine Months

Ohio River Valley: E2 drop down complete EnLink Midstream Holdings (EMH): 25% drop down complete



Avenue 2: Growing With Devon

West Texas: Ajax Plant & Martin County Expansion announced



Avenue 3: Organic Growth Projects

Ohio River Valley: condensate pipeline & stabilization / gas compression stations announced Louisiana: Marathon JV & NGL pipeline announced



Avenue 4: Mergers & Acquisitions

Louisiana: Gulf Coast natural gas assets acquired West Texas: LPC crude logistics business acquired West Texas: Coronado acquisition announced



~$1.1 Billion ~$200 MM+ ~$300 MM+ ~$935 MM In the last nine months, EnLink announced $2.5 Billion of acquisitions and growth projects. EnLink also completed construction on ~$1 billion of growth projects, including the Cajun-Sibon and the Bearkat expansions.

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Capital Commitment

Avenue 1: Drop Downs

Devon Sponsorship Creates Drop Down Opportunities

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2014 2015 2016 2017 Devon Sponsorship Provides Potential for ~$375 MM of Adjusted EBITDA from Drop Downs Other Potential Devon Drop Downs *

E2

25% EMH ** Access Pipeline * Victoria Express Pipeline *

Drop Down Cost:

~$193 MM

Estimated Adjusted EBITDA:

~$20-25 MM

Estimated Capital Cost:

~$1.0 B

Estimated Adjusted EBITDA:

~$150 MM

Drop Down Cost for 25% Interest:

$925 MM

Estimated 2015 Adjusted EBITDA:

~$100 MM **

Estimated Capital Cost:

~$70 MM

Estimated Adjusted EBITDA:

~$12 MM



25% EMH



Avenue 1: Drop Downs

E2 Drop Down in Ohio River Valley

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New Assets

• Three facilities operating, two under construction
• When completed, five facilities will have total

capacity of ~580 MMcf/d and ~19,000 Bbl/d

Strategic Benefits

• Key customer: Antero Resources
• 100% fee-based contracts with minimum volume

commitments

• Drop down from ENLC to ENLK completed in

October 2014

• Approximately $193 MM acquisition cost
• Estimated annual adjusted EBITDA contribution:

~$20-25 MM E2 Stations * * *

Avenue 1: Future Drop Downs

Devon’s Access & Victoria Express Pipelines

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• Three ~180 mile pipelines from Sturgeon

terminal to Devon’s thermal acreage

• ~30 miles of dual pipeline from Sturgeon

Terminal to Edmonton

• Capacity net to Devon:
• Blended bitumen: 170,000 Bbl/d
• Devon ownership: 50%
• ~$1B invested to date
• ~56 mile crude oil pipeline from Eagle Ford

core to Port Victoria terminal

• ~300,000 Bbl of storage available
• Capacity:
• 50,000 Bbl/d start-up capacity (expandable)
• Devon ownership: 100%
• ~$70 MM invested to date

Access Pipeline Victoria Express Pipeline

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Avenue 2: Growing With Devon

Martin County Expansion in West Texas

• Ajax: ~120 MMcf/d cryogenic processing plant
• Acreage dedication from Devon in Martin County
• Anchored by long-term, fee-based contract
• Expect to begin operations in 2016

Note: EnLink Midstream will own the Coronado assets upon the closing of the acquisition, but does not own them today.

Avenue 2: Growing With Devon

Significant Production Growth in Cana-Woodford

Devon Assets in the Cana-Woodford

• Devon Rigs in Cana

̶ End of 2014: 5 rigs ̶

• Avg. in 2015: 8 rigs (including non-operated)
• Acreage: ~280,000 net acres
• Workover activity yielded excellent results

̶ Acid treatments performed on 200+ wells ̶

• Avg. rates per well increased 1-2+ MMCFE/d

̶ Payback period <3 months

• Emerging opportunity in STACK oil window

̶ 35,000 net acres

• Significant undrilled well inventory

̶ Expected wells drilled in 2015: 95 total ̶ Expected wells in STACK oil window: 20

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EnLink Assets in the Cana-Woodford

• Pipeline: 410 miles, 530 MMcf/d capacity
• Processing: one plant with 350 MMcf/d capacity

Avenue 3: Organic Growth Projects

Gulf Coast Market for Products & Services is Strategic to Growth Plans

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Source: EIA/RBN Energy 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0

Bcf/d

New Gas Pipelines to Gulf Coast

Avenue 3: Organic Growth Projects

Cajun-Sibon Expansion Complete

• 258 miles of NGL pipeline from Mont Belvieu area to NGL fractionation assets

in south Louisiana (195 miles new, 63 miles re-purposed)

• 140 MBbl/d south Louisiana fractionation expansion
• Phase I completed Q4 2013; Phase II completed in Q4 2014
• Expected run-rate adjusted EBITDA of ~$115 MM

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New Assets in Development

• 30-mile, 10” NGL pipeline from EnLink’s

Riverside fractionator to Marathon Petroleum’s Garyville refinery

• Expected to be operational in first half of 2017

Strategic Benefits

• 50/50 JV with Marathon Petroleum Corp.
• Marathon to support the project with 50% of

capital cost and long-term, fee-based contracts for butane and natural gasoline transportation, supply and optional storage

• EnLink to construct and operate the pipeline
• First bolt-on project to Cajun-Sibon expansion

Avenue 3: Organic Growth Projects

JV with Marathon to Build NGL Pipeline in South LA

*

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Avenue 3: Organic Growth Projects

Ohio River Valley Condensate Pipeline, Stabilization & Compression System Expansion

New Assets In Development

• 45-mile, 8” condensate pipeline with an expected

capacity of ~50,000 Bbl/d

• 6 new condensate stabilization and natural gas

compression stations with combined capacities of ~41,500 Bbl/d and ~560 MMcf/d, respectively

• Once complete, EnLink’s assets in the

Utica/Marcellus will include:

• 250 miles of pipeline
• 11 natural gas compression and condensate

stabilization facilities with total capacity of ~1.2 Bcf/d and ~60,000 Bbl/d, respectively

• Over 110 trucks
• Eight brine disposal wells
• ~630,000 Bbl of above ground storage

Strategic Benefits

• Leverages and expands EnLink’s footprint of

midstream assets in the Utica/Marcellus

• Supported by long-term, fee-based contracts
• Deploying over $250 MM in capital; increases

EnLink’s investment in the ORV to over ~$700 MM

* * *

Avenue 4: Mergers & Acquisitions

Gulf Coast Natural Gas Assets

• Closed on ~$235 million acquisition from Chevron on November 1st
• Creates opportunities to optimize Louisiana assets and convert redundant natural

gas pipelines to other services

• ~1,400 miles of natural gas pipelines in three systems spanning from Port Arthur,

TX to the Mississippi River corridor

• ~11 Bcf of natural gas storage capacity in three south Louisiana caverns
• Ownership and management of title tracking services offered at Henry Hub
• Expected near-term acquisition multiple: ~10x adjusted EBITDA

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Avenue 4: Mergers & Acquisitions

Coronado Midstream in Midland Basin

21 Note: EnLink Midstream will own the Coronado assets upon the closing of the acquisition, but does not own them today.

• Announced ~$600 million agreement to acquire Coronado Midstream Holdings LLC on Feb. 2, 2015
• Coronado’s assets include:
• ~175 MMcf/d of gas processing capacity
• ~270 miles of gas gathering pipelines with ~35,000 horsepower of compression
• Under construction: ~100 MMcf/d of processing capacity and gathering system expansions
• Underpinned by long-term contracts and production dedication from over 190,000 acres
• Key producers include Reliance Energy, Inc., Diamondback Energy, Inc. and RSP Permian, Inc.
• Expected long-term acquisition multiple: 7-8x adjusted EBITDA with $400-$600 of additional capital expenditures

Avenue 4: Mergers & Acquisitions

LPC Crude Oil Logistics Business

• Closed on acquisition of LPC Crude Oil Marketing, LLC

(“LPC”) on January 31, 2015 for ~$100 MM

• LPC’s assets include:
• 13 pipeline and refinery injection stations,
• ~67 miles of crude gathering systems
• 43 tractor trailers
• Extensive crude oil first purchasing operation
• Acquisition Multiple: ~8x run rate adjusted EBITDA

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EnLink Midstream Today & Tomorrow

EnLink Midstream Today EnLink Midstream Potential Future in 2017

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Drop Downs

Growing with Devon

Organic Growth M&A

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Our Strategy: Stability Plus Growth

A Stable Investment in the MLP Space

Stability of cash flows

• ~95% fee-based contracts
• ~50% of gross operating margin from long-term Devon contracts

Top tier midstream energy service for our customers Leverage Devon Energy sponsorship for growth

• Expect significant growth from dropdowns
• Serve Devon E&P portfolio in its growth areas

Strong organic growth

• South Louisiana, West Texas and Ohio River Valley (ORV) expansion projects

Top tier balance sheet

• Investment grade credit rating at ENLK since inception
• Strong liquidity with a new $1.5 billion credit facility