Attached files
| file | filename |
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| 8-K - COPANO ENERGY, L.L.C. FORM 8-K - Copano Energy, L.L.C. | form8-k.htm |
Platts
3rd Annual Midstream
Development & Management
Conference
May 20, 2010
Development & Management
Conference
May 20, 2010
NASDAQ: CPNO
Disclaimer
Statements made by
representatives of Copano Energy, L.L.C. (“Copano”) during this presentation
will
include “forward-looking statements,” as defined in the federal securities laws. All statements that
address activities, events or developments that Copano believes will or may occur in the future are
forward-looking statements. Underlying these statements are assumptions made by Copano’s
management based on their experience and perceptions of historical trends, current conditions,
expected future developments and other factors management believes are appropriate under the
circumstances.
include “forward-looking statements,” as defined in the federal securities laws. All statements that
address activities, events or developments that Copano believes will or may occur in the future are
forward-looking statements. Underlying these statements are assumptions made by Copano’s
management based on their experience and perceptions of historical trends, current conditions,
expected future developments and other factors management believes are appropriate under the
circumstances.
Whether future
results and developments will conform to Copano’s expectations is subject to a
number
of risks and uncertainties, many of which are beyond Copano’s control. If one or more of these risks or
uncertainties materializes, or if underlying assumptions prove incorrect, then Copano’s actual results
may differ materially from those implied or expressed by forward-looking statements made during this
presentation. These risks and uncertainties include the volatility of prices and market demand for
natural gas and natural gas liquids; Copano’s ability to complete any pending acquisitions and integrate
any acquired assets or operations; Copano’s ability to continue to obtain new sources of natural gas
supply; the ability of key producers to continue to drill and successfully complete and attach new
natural gas supplies; Copano’s ability to retain key customers; the availability of local, intrastate and
interstate transportation systems and other facilities to transport natural gas and natural gas liquids;
Copano’s ability to access sources of liquidity when needed and to obtain additional financing, if
necessary, on acceptable terms; the effectiveness of Copano’s hedging program; unanticipated
environmental or other liability; general economic conditions; the effects of government regulations and
policies; and other financial, operational and legal risks and uncertainties detailed from time to time in
the Risk Factors sections of Copano’s annual and quarterly reports filed with the Securities and
Exchange Commission.
of risks and uncertainties, many of which are beyond Copano’s control. If one or more of these risks or
uncertainties materializes, or if underlying assumptions prove incorrect, then Copano’s actual results
may differ materially from those implied or expressed by forward-looking statements made during this
presentation. These risks and uncertainties include the volatility of prices and market demand for
natural gas and natural gas liquids; Copano’s ability to complete any pending acquisitions and integrate
any acquired assets or operations; Copano’s ability to continue to obtain new sources of natural gas
supply; the ability of key producers to continue to drill and successfully complete and attach new
natural gas supplies; Copano’s ability to retain key customers; the availability of local, intrastate and
interstate transportation systems and other facilities to transport natural gas and natural gas liquids;
Copano’s ability to access sources of liquidity when needed and to obtain additional financing, if
necessary, on acceptable terms; the effectiveness of Copano’s hedging program; unanticipated
environmental or other liability; general economic conditions; the effects of government regulations and
policies; and other financial, operational and legal risks and uncertainties detailed from time to time in
the Risk Factors sections of Copano’s annual and quarterly reports filed with the Securities and
Exchange Commission.
Copano undertakes
no obligation to update any forward-looking statements, whether as a result of
new
information or future events.
information or future events.
2
Introduction
to Copano
Independent
midstream company founded in 1992
■ Best in class
service to customers
■ Entrepreneurial
approach
■ Focus on long-term
accretive growth
Provides midstream
services in multiple producing areas through
three operating segments
three operating segments
■ Texas
● South Texas
conventional and Eagle Ford Shale
● North Texas
Barnett Shale Combo play
■ Central and
Eastern Oklahoma
● Conventional,
Hunton De-Watering play and Woodford Shale
■ Rocky
Mountains
● Powder River
Basin
3
Key
Metrics
Service throughput
volumes approximate 1.8 Bcf/d of natural
gas(1)
gas(1)
Approximately
6,700 miles of active pipelines
8 natural gas
processing plants with over 1.1 Bcf/d of combined
processing capacity
processing capacity
One NGL
fractionation facility with total capacity of 22,000 Bbls/d
Equity market cap:
$1.6 billion(2)
Enterprise value:
$2.3 billion(2)
4
Based
on 1Q 2010 results. Includes
unconsolidated affiliates.
As
of May 18, 2010.
Economics
of Drilling Critical - Producers
and Midstream
and Midstream
Recession of 2008
hit gas demand
Gas prices in $3 -
$4 range
Expectations for
slow recovery of prices and economy
Drilling focused
on low cost production plays
Shale plays are
focus of drilling
5
Shale
Play Breakeven Economics
6
Source:
Ross Smith Energy Group, Ltd (September 4, 2009)
Shale
Play Considerations
Impact of
commodity prices to producer’s economics
Access to
infrastructure and markets
Land and
geography
Regulatory
regime
7
Commodity
Prices - Uplift of Liquids
8
Commodity
Prices - NGL Uplift
9
Prices
as of 5/18/10
Full
value prior to deduction of Copano’s margin. Excludes
value of condensate and crude oil recovered by the producer at the
wellhead.
Implied
NGL prices are based on a six-year historical regression analysis.
Assumes
4.6 GPM gas with a Btu factor of 1.16 processed at indicative processing
facility, and field fuel of 2.62%.
Assumes
unprocessed gas with a Btu factor of 1.0 and field fuel of
3%.
Infrastructure
and Markets
Gas
pipelines
Processing
Liquids handling
(transportation and fractionation)
Proximity to
market - distance and basis considerations
10
Eagle
Ford Play
11
Geographical
Considerations
Rights-of-way
■ Number of
landowners
■ Costs
■ Higher acquisition
risks
■ Condemnation
issues
Topography
■ River
crossings
■ Terrain
■ Access to
roads
Weather
■ Construction
window
■ Equipment
protection
12
Regulatory
and Political Considerations
Environmental
■ Endangered
species
■ Water resource
access and disposal (well fracturing)
■ Air
quality
■ Noise
Permitting
■ Lead
time
■ Regulatory
hurdles
Political
climate
■ Taxing
authority
■ Public
sentiment
13
Eagle
Ford Advantages
Substantial
infrastructure exists today
Rich gas and
condensate/crude provide drilling incentive to
producers
producers
Significant demand
for natural gas and NGLs in southeast Texas
Historically fewer
land-related issues (leasing and ROW)
Lower construction
costs relative to many other places (topography
and development)
and development)
Regulatory
environment is conducive to energy development
14
Copano’s
Houston Central Complex
700 MMcf/d of
processing capacity
■ 200 MMcf/d of
readily available expansion capacity with further expansions
feasible
feasible
Newly commissioned
22,000 BPD fractionator
■ Ability to further
expand fractionation facility
15
Copano’s
Houston Central Complex
Purity ethane and
propane pipelines provide NGL transportation to
market
market
■ Ability to expand
purity product line capacities
■ Truck loading
racks for iso-butane and normal butane
Multiple residue
markets including two interstate pipelines, two
intrastate pipelines and ability to add additional interstate
interconnects
intrastate pipelines and ability to add additional interstate
interconnects
■ Proximity to
market (HSC) results in better natural gas pricing to producers
16
Contact
Information
Jim
Wade
Copano Energy -
Texas
President
jim.wade@copanoenergy.com
17
Brian
Eckhart
Copano Energy -
Texas
Senior Vice
President, Supply and
Transportation
brian.eckhart@copanoenergy.com