Enable Midstream Partners, LP · 2015-05-20 · Enable Midstream Partners, LP NAPTP 2015 MLP Investor Conference May 20, 2015 . ... • 19,500 Bbl/d crude oil gathering system now

Enable Midstream Partners, LP

NAPTP 2015 MLP Investor Conference

May 20, 2015

Forward-looking Statements

This presentation and the oral statements made in connection herewith may contain “forward-looking statements” within the

meaning of the securities laws. All statements, other than statements of historical fact, regarding Enable Midstream Partners’

(“Enable”) strategy, future operations, financial position, estimated revenues, projected costs, prospects, plans and objectives of

management are forward-looking statements. These statements often include the words “could,” “believe,” “anticipate,” “intend,”

“estimate,” “expect,” “project,” “forecast” and similar expressions and are intended to identify forward-looking statements, although

not all forward-looking statements contain such identifying words. These forward-looking statements are based on Enable’s current

expectations and assumptions about future events and are based on currently available information as to the outcome and timing of

future events. Enable assumes no obligation to and does not intend to update any forward-looking statements included

herein. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements

described under the heading “Risk Factors” included in our SEC filings. Enable cautions you that these forward-looking statements

are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond its control,

incident to the ownership, operation and development of natural gas and crude oil infrastructure assets. These risks include, but

are not limited to, contract renewal risk, commodity price risk, environmental risks, operating risks, regulatory changes and the other

risks described under “Risk Factors” in our SEC filings. Should one or more of these risks or uncertainties occur, or should

underlying assumptions prove incorrect, Enable’s actual results and plans could differ materially from those expressed in any

forward-looking statements.

2

Enable Highlights

► High-Quality Assets

► High degree of interconnectivity between assets and end markets and consumers

► Assets are located in four of the most prominent natural gas and crude oil producing basins in the country

► Strong Customer Relationships

► Long-term relationships with large-cap producers and utilities, many of whom are investment grade

► Significant and repeat business in highly competitive areas

► Solid Financial Position

► Favorable contract structure with significant fee-based and demand-fee margin

► Investment grade ratings and lower leverage than many peers

► Significant Growth Opportunities

► Up to $1.18 billion of expansion capital opportunities anticipated in 20151

► Producer activity in Enable’s growth areas is driving opportunities across the midstream value chain

3

1. As of Enable’s first quarter 2015 earnings release on May 6, 2015

Interconnected, Diverse and Strategically Located

4

Diverse Set of Interconnected Assets in Ten States

Note: Operational data as of or for the year ended December 31, 2014, except for interstate and intrastate transportation pipeline mileage and Anadarko processing plants and processing capacity, which are as of March 31, 2015.

Enable provides operating reach and scale with complementary capabilities managing gas gathering

and processing services, intrastate and interstate transmission and storage for customers in the

Mid-Continent region and crude oil gathering services in the Bakken

Interstate MRT

• 1,663 miles

• 1.9 Bcf/d capacity

• 32.0 Bcf storage capacity

G&P: Arkoma

• 2,893 miles

• 139,620 Horsepower

• 0.77 Tbtu/d gathering volumes

• 1 processing plant

• 60 MMcf/d processing capacity

• 4.4 Mbbl/d NGLs produced

• 1.4 mm gross acres of

dedication

G&P: Ark-La-Tex

• 1,673 miles



• 2 processing plants


• 14,500 bbl/d fractionation capacity


• 0.7 mm gross acres of dedication

Intrastate EOIT

• 2,241 miles

• 1.9 Bcf/d peak throughput


G&P: Anadarko

• 7,345 miles




• 1.645 Bcf/d processing capacity



Interstate EGT

• 5,952 miles



G&P: Williston

• 19,500 Bbl/d crude oil

gathering system now fully

operational

• Additional 30,000 Bbl/d crude

gathering system currently

under construction

Interstate SESH

• Own 49.90% interest

• 286 miles


Enable Ownership Structure

5

18.3% LP

ownership

Enable Midstream Partners, LP

NYSE: ENBL

Transportation

and Storage

Gathering and

Processing

50% Management Interest /

60% Economic Interest 50% Management Interest /

40% Economic Interest

Incentive Distribution

Rights Public

Unitholders 26.3% LP ownership 55.4% LP ownership

Enable GP, LLC

► Sponsors CenterPoint Energy and OGE Energy have a substantial ownership interest in Enable

that represents a significant portion of their respective assets, supporting continued sponsor focus

going forward

Large and Diverse Customer Base

6

High Quality Customers

Enable’s revenues are strengthened by a diverse, high-quality customer base, many of whom are

investment grade

(Investment Grade)

(Investment Grade)

(Investment Grade) (Investment Grade)

(Investment Grade)

(Investment Grade)

(Investment Grade) (Investment Grade)

QEP Resources, Inc.QEP Resources, Inc.

(Investment Grade)

(Investment Grade)

► Many of our customers rely on us for multiple midstream services across both G&P and T&S

► Loyal customer base through exemplary customer service and reliable project execution

Commodity Exposure ► Enable targets fee-based contracts on a firm basis, when possible

► Some gathering and processing contracts have provisions to protect against low

commodity price environments and volume decreases

► Commodity sensitivities for second quarter 2015 through fourth quarter 2015, including the

impact of hedges:

► A 10% increase or decrease in the price of natural gas from forecasted levels would result in an increase or decrease

of approximately $6 million in gross margin

► A 10% increase or decrease in the price of NGLs and condensate from forecasted levels would result in an increase

or decrease of approximately $1 million in gross margin

Note: As of Enable’s earnings release on May 6, 2015 1. Percentages in pie charts based on Gross Margin contribution 2. Excludes basis not matched with NYMEX and natural gas shrink associated with ethane spread positions 3. Enable hedges condensate exposure with crude

Q2 2015 – Q4 2015 Fee-Based Margin Profile1

7

~94% fee-

based or

hedged

Q2 2015 – Q4 2015 Commodity Hedging Summary

Commodity Q2 – Q4 2015

Natural Gas2

Exposure Hedged (%) 66%

Average Hedge Price ($/MMBtu) $3.23

Crude3


Average Hedge Price ($/Bbl) $59.16

Propane


Average Hedge Price ($/gal) $0.58

53%

30%

11%

6%

Firm/MVC Fee-based Other Fee-based

Commodity-based Hedged Commodity-based Unhedged

Appendix Gathering and Processing Segment

8

Anadarko Basin

9

► Anadarko “super-header” system

connects eight processing facilities,

allowing Enable to optimize natural gas

processing economics and improve

system utilization and reliability

► Producers remain active in the Anadarko

Basin, particularly in the SCOOP, Cana

Woodford and Granite Wash plays

► Anadarko volume growth is driving

infrastructure investments

► 200 MMcf/d Bradley Plant started

full operations in the first quarter of

2015

► Additional 200 MMcf/d SCOOP-

area plant in Grady County

scheduled for a first quarter 2016

start-up

► SCOOP-area compression totals

130,000 horsepower

► Recently acquired a natural gas

gathering system for $80 million in the

high-returning Cleveland Sands play

System Map System Highlights

• 7,345 miles


• 1.38 TBtu/d gathering volumes


• 1.645 Bcf/d processing capacity

• 51.6 MBbl/d NGLs produced


Note: Operational data as of or for the year ended December 31, 2014, except for processing data, which is as of March 31, 2015

$19

$13

$6 $7 $8

$5 $3 $3

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SCOOP Remains a Top Play

10

Source: Wood Mackenzie

► SCOOP breakeven prices estimated at $41-$47 per barrel for the SCOOP Core in Grady, Garvin and

Stephens Counties of Oklahoma

► Over $63 billion remaining to be spent in the SCOOP, STACK and Cana footprint through 2025 with

approximately $19 billion related to investments in the SCOOP Core

► SCOOP production expected to more than double over 10 years

► Enable has significant, long-term contracts and acreage dedications with the largest leaseholders and

most active operators in the play

► Currently, 18 rigs in the SCOOP area are drilling wells scheduled to be connected to Enable’s

gathering systems

0

200

400

600

800

1,000

1,200

1,400

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Pro

ductio

n (

mboe/d

)

Gas NGL Crude & Condensate

Remaining Producer Capex by Sub-play SCOOP Production Outlook

$ billions

Ark-La-Tex and Arkoma Basins

11

► Rich gas exposure to the Cotton Valley play and lean gas exposure to the Haynesville and

Fayetteville Shales

► Primarily fee-based with significant minimum volume commitment contracts

► The Haynesville Shale is starting to see growing natural gas output again1, despite low natural

gas prices, as drilling costs decline and new demand develops in Gulf Coast markets

Ark-La-Tex System Map

System Highlights

Arkoma System Map

• 2,893 miles



• 1 processing plant



• 1.4 mm gross acres of

dedication

• 1,673 miles





• 14.5 MBbl/d fractionation capacity



Note: Operational data as of or for the year ended December 31, 2014. 1. April 2015 U. S. Energy Information Administration (EIA) Drilling Productivity Report

Williston Basin

12

► Enable’s first crude gathering system, a

19,500 Bbl/d system located in Dunn and

McKenzie counties in North Dakota, was

completed in the first quarter of 2015

► In the first quarter of 2015, Enable began

commissioning it’s second crude

gathering system, a 30,000 Bbl/d system

located in Williams and Mountrail

counties in North Dakota, and anticipates

the system’s full capacity will be available

by the end of 2015

► Enable continues to add origin points and

is looking to bring non-system barrels

onto existing systems

► 93% of the active rigs in North Dakota

are active in counties in which the

partnership operates or is constructing

assets1

► XTO, Enable’s top customer in the

Bakken, is the most active producer in

North Dakota with 12 rigs running in the

state1

System Map System Highlights

Note: Operational data as of or for the year ended December 31, 2014 1. Per North Dakota’s Department of Mineral Resources website as of April 28, 2015

-5%

0%

5%

10%

15%

20%

25%

30%

Base Case 20% Completed Well Costs Reduction

Return Analysis by Play

13

Gas Price = 12 month forward average curve for each regional pricing point (range $1.92 - $2.91/Mcf)

Oil Price = 12 month forward average WTI +/- differential (range $38.82-$54.24/barrel)

NGL Prices = weighted average $/barrel, 12-mo forward average Mt. Belvieu prices (range $19.25-$26.36/barrel)

Source: Bentek

Internal Rate of Returns for Major Plays

► Enable’s growth areas still rank as some of the highest returning plays in the country

► Enable is positioned in the core of the Bakken and SCOOP plays where returns are

strongest

Plays with Enable assets

Appendix Transportation and Storage Segment

14

Enable Gas Transmission (EGT)

15

► 5,952-mile interstate pipeline serving

Arkoma, Ark-La-Tex and Anadarko

basins in Oklahoma, Texas, Arkansas,

Louisiana and Kansas

► Shippers on EGT have the ability to

access almost every major natural

gas-consuming market east of the

Mississippi River

► EGT’s primary customers include

LDCs, gas producers and gas-fired

power generators

► EGT well-positioned to serve

increasing Oklahoma production

► Bradley Lateral pipeline will

serve SCOOP volume growth

► In the first quarter, Enable

conducted an open season for

additional transportation options

from receipt points in Oklahoma

to Bennington, Oklahoma, and

Perryville, Louisiana

Pipeline Map Pipeline Highlights

• 5,952 miles



Note: Operational data as of or for the year ended December 31, 2014, except for pipeline miles, which are as of March 31, 2015.

Mississippi River Transmission (MRT)

16

► 1,663-mile interstate pipeline in Texas,

Arkansas, Louisiana, Missouri and

Illinois

► MRT’s primary delivery points are to

local distribution companies and

industrial markets in the St. Louis

market area

► MRT offers shippers competitive

rates and access to diverse

supply points

► MRT’s firm transportation and storage

contracts with Laclede, MRT’s largest

customer, were extended in

September 2014 through 2017 and

2018 at existing contract demand

levels

► MRT has an 86-year relationship

with Laclede


• 1,663 miles




Southeast Supply Header (SESH)

17

► 286-mile interstate natural gas pipeline

that runs from the Perryville Hub in

Louisiana to connections with Florida

markets in southeastern Alabama

► Joint venture among Enable, Spectra

Energy and CenterPoint

► Enable acquired an additional 24.95%

interest in SESH from CenterPoint

Energy in May 2014, bringing Enable’s

total ownership of SESH to 49.90%

► SESH’s primary customers are electric

utilities in the Florida market area

► 100% of contracts with

investment grade counterparties

► Expansion of 45 mdth/d facilitated by

an agreement with Enable Gas

Transmission was placed into service

in October 2014 and additional

compression at TET interconnect is

under construction.


• Own 49.90% interest

• 286 miles


Note: Operational data as of or for the year ended December 31, 2014.

Enable Oklahoma Intrastate Transmission (EOIT)

18

► 2,241-mile intrastate transportation

pipeline system in Oklahoma

► Connected to the EGT system and 12

third-party natural gas pipelines

through 66 interconnect points

► Major transportation customers are

OG&E, Enable’s affiliate, and Public

Service Company of Oklahoma (PSO),

an affiliate of AEP, the two largest

electric utilities in Oklahoma

► EOIT provides gas transmission

delivery services to all of

OG&E’s and PSO’s natural gas-

fired electric generation facilities

in Oklahoma

► Positioned to serve SCOOP, Cana

Woodford, Mississippi Lime and

Greater Granite Wash production


Intrastate EOIT

• 2,241 miles

• 1.9 Bcf/d peak throughput



T&S Well-Positioned for Growth

19

Open Season Update

► In the first quarter, Enable announced an open season on EGT for additional transportation options

from receipt points in Oklahoma to Bennington, Oklahoma, and Perryville, Louisiana

► Received a positive response and currently evaluating bids received

► This additional capacity would enhance Enable’s leading position to provide transport services from

the Anadarko basin to key downstream markets

Power Plants Near Enable’s Footprint1 Market Update

► Power plant and LDC loads account for over 5.0

Bcf/d on Enable’s transportation systems

► Enable is well-positioned to capture additional

demand with over 45 coal-fired plants located

within a 50-mile radius of Enable’s pipelines

► Within a 50 mile radius are another 60+ units

totaling 6+ Bcf/d of gas fired capacity that is not

connected to Enable

1. Power Plant locations per the EIA

Appendix Growth Strategy and Outlook

20

Growth Strategy

21

► Capture organic growth

opportunities in our core basins

► Extend the value chain from

wellhead to end users in our core

commodities of gas, NGLs and

crude

► Establish a presence in high-growth

basins

► Develop a meaningful and

competitive position in any basin

where we participate

► Capture additional market demand

on and around our system

► Maximize earnings stability by

increasing fee-based margin

Acquisition Philosophy

22

► Enable’s balance sheet provides the opportunity to

pursue acquisitions to complement the partnership’s

organic growth strategy

► Enable will prioritize acquisition opportunities that provide

entry into new high-growth basins, increase Enable’s

footprint in current basins or extend the value chain

► Enable will remain disciplined, ensuring that acquisitions

meet strategic and financial goals

2015 Outlook

23

1. Distribution growth calculated as the growth rate from Enable’s $0.30875 fourth quarter 2014 distribution to Enable's projected fourth quarter 2015 distribution

2. Distribution growth calculated as the compound annual growth rate from Enable’s minimum quarterly distribution of $0.2875 per unit through the fourth quarter of 2015 (7 quarterly compounding periods)

3. Natural gas liquids composite based on an assumed composition of 45%, 30%, 10%, 5%, and 10% for ethane, propane, normal butane, isobutane and natural gasoline, respectively.

Feb 18, 2015 May 6, 2015

$ in millions, except volume numbers 2015 Outlook 2015 Outlook

Natural Gas Gathered Volumes (TBtu/d) 3.1 – 3.3 3.1 – 3.3

Natural Gas Processed Volumes (TBtu/d) 1.6 – 1.8 1.7 – 1.9

Crude Oil – Gathered Volumes (MBbl/d) 20.0 – 22.0 13.0 – 15.0

Adjusted EBITDA $800 – $860 $800 – $840

Adjusted Interest Expense, net $95 – $105 $100 – $110

Maintenance Capital $140 – $160 $140 – $160

Distributable Cash Flow $540 – $590 $540 – $590

Per-unit Distribution Growth1 3% – 7% 3% – 7%

Per-unit Distribution Growth from MQD 2 6% – 8% 6% – 8%

Coverage Ratio 1.0x – 1.08x 1.0x – 1.08x

2015 guidance centered around the following price assumptions:

• Natural Gas (Henry Hub) at $2.80/MMBtu (compared to $2.85/MMBtu on February 18, 2015)

• Natural Gas Liquids Composite3: Mont Belvieu, Texas at $.48/gal; Conway, Kansas at $.45/gal (compared to $.47/gal and $.46/gal ,

respectively, on February 18, 2015)

• Crude Oil (WTI) at $56.00/Bbl (compared to $52.50 on February 18, 2015)

As of Enable’s Earnings

Release on May 6, 2015

Expansion Capital Outlook

24

► Contracted Expansion includes:

► Gathering, compression and processing infrastructure to support projected volume growth from current contracts and

acreage dedications, including infrastructure in the SCOOP, Bakken and Greater Granite Wash plays

► Identified Opportunities include transportation and G&P projects in late-stage negotiation, such as:

► Additional Bakken crude gathering expansions

► Anadarko gas gathering and processing expansions

► New end-user transportation service and market access pipeline opportunities

► NGL transportation infrastructure

$ in millions

Feb 18, 2015

2015 Outlook

May 6, 2015

2015 Outlook

Contracted Expansion $600 – $800 $600 – $800

Acquisitions – $80

Identified Opportunities $0 – $300 $0 – $300

Total $600 – $1,100 $680 – $1,180

As of Enable’s Earnings

Release on May 6, 2015

Key Investment Highlights

25

Fully integrated suite of assets: ~11,900 miles of gathering systems, 13 major processing plants,

7,900 miles of interstate pipelines (including SESH, in which we own a 49.90% interest), ~2,300

miles of intrastate pipelines and eight storage facilities comprising 87.5 Bcf of storage capacity

Over 1.3 million operated horsepower of compression and 197.6 MBbls/d of NGL production

capacity making us one of the largest operators of compression and producers of NGLs in the

United States

High degree of interconnectivity between assets and end markets and consumers

Largest entity based on asset size at IPO in the history of the MLP space

Assets are located in four of the most prominent natural gas and crude oil producing basins in the

country: Anadarko, Arkoma, Ark-La-Tex and Williston

227 rigs are currently operating in the counties in which Enable operates or is constructing assets

as of April 29, 20151

Long-term relationships with large-cap producers and utilities, many of whom are investment

grade

Significant and repeat business in highly competitive areas

Favorable contract structure with significant fee-based and demand-fee margin

Long-term contracts with stable customers and active producers

Approximately 6.6 million of gross acreage dedications as of December 31, 2014

Investment grade ratings and lower leverage than many peers

CNP and OGE have long, proven track records and share a common vision of long-term value

creation

Management team has significant industry experience with an average of ~30 years

Expansion capital of ~$3.0 billion deployed in the last 4 years, on a pro forma basis

Company-wide bench strength with proven execution record

Proven Commercial Success with Diverse Customers

Fee-based Business and Long-term Contracts

Significant Size, Scale and Diversity

Strategically Located Assets

Financial Flexibility and Strong Sponsorship

Experienced Management and Demonstrated Execution

Note: Operational data as of or for the year ended December 31, 2014, except for interstate and intrastate pipeline mileage and number of processing plants, which are as of March 31, 2015 1. Per Drillinginfo

Question and Answer Question & Answer

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Documents

Enable Midstream Partners, LP · 2015-05-20 · Enable Midstream Partners, LP NAPTP 2015 MLP Investor Conference May 20, 2015 . ... • 19,500 Bbl/d crude oil gathering system now