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All rights reserved. Enterprise Products Partners L.P.
Seaway Pipeline and Cushing
September 20, 2012
www.enterpriseproducts.com
Tony Chovanec VP, Fundamentals /
Strategic Assessment
All rights reserved. Enterprise Products Partners L.P. 2
Forward–Looking Statements
This presentation contains forward-looking statements based on the beliefs of the company, as well as assumptions made by, and information currently available to our management team. When used in this presentation, words such as “anticipate,” “project,” “expect,” “plan,” “seek,” “goal,” “estimate,” “forecast,” “intend,” “could,” “should,” “will,” “believe,” “may,” “potential” and similar expressions and statements regarding our plans and objectives for future operations, are intended to identify forward-looking statements. Although management believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. You should not put undue reliance on any forward-looking statements, which speak only as of their dates. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those expected, including insufficient cash from operations, adverse market conditions, governmental regulations, the possibility that tax or other costs or difficulties related thereto will be greater than expected, the impact of competition and other risk factors discussed in our latest filings with the Securities and Exchange Commission. All forward-looking statements attributable to Enterprise or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained herein, in such filings and in our future periodic reports filed with the Securities and Exchange Commission. Except as required by law, we do not intend to update or revise our forward-looking statements, whether as a result of new information, future events or otherwise.
All rights reserved. Enterprise Products Partners L.P. 3
Enterprise Overview
Largest publicly traded energy partnership in United States with an enterprise value of approximately $63 billion 62nd on Fortune 500 226th on Fortune Global 500 Integrated midstream energy system serving producers and consumers of natural gas, NGLs, crude oil, petrochemicals and refined products Access to prime natural gas / NGL / crude oil supply basins in the U.S. Pipelines connected to every U.S. ethylene steam cracker (largest
consumer of NGLs) and ≈95% of refining capacity east of the Rockies Diversified businesses and sources of cash flow Significant investment in new natural gas, NGLs and crude oil infrastructure to support development of shale plays including: Eagle Ford, Rockies, Haynesville, Permian Basin and Marcellus / Utica $7.5 billion of growth projects under construction
All rights reserved. Enterprise Products Partners L.P. 4
EPD Portfolio of Integrated Assets
50,700 miles of natural gas, NGL, crude oil, refined products and petrochemical pipelines 190 MMBbls of NGL, refined products and crude oil, and 14 Bcf of natural gas storage capacity 25 natural gas processing plants
20 NGL & Propylene fractionators 6 offshore hub platforms NGL import / export terminals Butane isomerization complex; octane enhancement facility; high-purity isobutylene facility
Major Asset Overview
All rights reserved. Enterprise Products Partners L.P. 5
Existing Wells and Shale Plays It’s No Coincidence
Source: USGS Production 2008
Crude Oil Gas
Gas
EPD Pipelines
Existing North American Production
Shale Plays
Oil
Liquids (NGL & Products)
All rights reserved. Enterprise Products Partners L.P. 6
The Science of the Shales
Hydrocarbons from shale rocks are the source for conventional oil and gas We have known about shales and their potential for years but could not extract their oil and gas in economic quantities Horizontal drilling and fracking techniques now enable hydrocarbon recovery from the natural fractures found in shales
Source: Rygel, M. C.
All rights reserved. Enterprise Products Partners L.P. 7
Continually Evaluating Emerging Shale / Non-Conventional Plays
Williston Basin Bakken
Uinta Basin Mancos
Piceance Basin Mancos
Fort Worth Basin Barnett
Black Warrior Basin Floyd & Chattanooga
Arkoma Basin Woodford
Delaware Basin Barnett / Woodford
South Texas Eagle Ford & Pearsall
North Louisiana, East Texas Haynesville
& Bossier
Denver Basin Niobrara
San Juan Basin Mancos
Michigan Basin Utica
Powder River Basin Niobrara
Appalachian Basin Marcellus
Permian Basin Bone Spring
Avalon & Wolfcamp
Appalachian Basin Utica
South Louisiana Tuscaloosa Marine
Primarily Rich Gas Primarily Dry Gas
Jonah Pinedale
Anadarko Basin Woodford
Anadarko Basin Hz Mississippian
Arkoma Basin Fayetteville
Illinois Basin New Albany
Michigan Basin Antrim
Source: EPD Fundamentals
All rights reserved. Enterprise Products Partners L.P. 8
Oil and Condensate Shale / Non- Conventional Plays
Williston Basin Bakken
Uinta Basin Wasatch, Mancos
Ft Worth Basin Barnett Combo
South Texas Eagle Ford,
Pearsall, Woodbine
Denver Basin Niobrara
San Juan Basin
Mancos
Michigan Basin Utica,
Collingwood
Powder River Basin
Niobrara
Permian Basin Bone Spring,
Avalon, Wolfcamp,
Cline
Appalachian Basin
Utica, Marcellus
South Louisiana Tuscaloosa Marine
Anadarko Basin Woodford
Anadarko Basin Mississippian
Anadarko Basin Granite Wash
Gulf of Mexico Deepwater
North Louisiana Brown Dense
Source: EPD Fundamentals
All rights reserved. Enterprise Products Partners L.P. 9
Framing the Opportunity Shale Longevity
Play Estimated Acres
Remaining Locations
Wells per Year
Potential Years of Drilling
Eagle Ford 10,000,000 100,000 2,500 40
Barnett 4,000,000 30,000 (>19,000 drilled)
1,000 30
Haynesville / Bossier 3,500,000 50,000 1,000 50
Marcellus 15,000,000 175,000 1,650 100
Utica 13,000,000 50,000 600 80
Mississippian 6,500,000+ 30,000+ 600 50
Source: EPD Fundamentals
All rights reserved. Enterprise Products Partners L.P. 10
2
4
6
8
10
12
14
1981 1986 1991 1996 2001 2006 2011
MMBbl/d
Imports of Crude Oil and Petroleum Products to U.S.vs. U.S. Domestic Oil Production
U.S. Net Imports of Crude Oil and Petroleum Products U.S. Field Production of Crude Oil and Petroleum Products
Falling Production and Growing Imports Trends Recently Reversed
Source: EIA
All rights reserved. Enterprise Products Partners L.P. 11
A Very Different Balance in Just 5 Years
Source: EIA
…while the U.S. has moved from a net refined product
importer to a large exporter.
U.S. oil imports from outside of North America have fallen by >1.5 MMBPD…
* includes oxygenates & gasoline blendstocks
U.S. Crude Oil Imports excluding Canada & Mexico Down 1.5 MMBPD
Finished Petroleum Products Net Imports Net Change >2.5 MMBPD
All rights reserved. Enterprise Products Partners L.P. 12
U.S. and Canadian Oil Production: Significant Growth, Mostly North of Cushing
Note: Does not include volumes for plays currently in the Pilot stage such as Utica, Niobrara, Mancos and Tuscaloosa. Sources: EPD Fundamentals and CAAP
US / Canada Oil Forecast
0
2
4
6
8
10
12
14
16
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
MM
Bop
d
0
2
4
6
8
10
12
14
16
South of Cushing
North of Cushing
Canada
+2.3 MMBPD Fr. 2008
+4.5 MMBPD Fr. 2008
+6.5 MMBPD Fr. 2008
MM
BP
D
U.S. / Canada Oil Forecast
All rights reserved. Enterprise Products Partners L.P. 13
Forecasted Change in Oil Production 2008 to 2020, MMBPD
Canada
CA/AK NE US
Mid-Cont.
Rockies
Williston
Permian
Offshore
+2.40
+1.11
–0.52 +0.26 +0.26
+0.54
+0.80
+0.58
Gulf Coast +1.07
North of Cushing / 4.05 MMBpd
South of Cushing / 2.45 MMBpd
Sources: EPD Forecasts and CAAP
All rights reserved. Enterprise Products Partners L.P. 14
EPD Crude Oil System Map
All rights reserved. Enterprise Products Partners L.P. 15
EPD Cushing Connectivity
Cushing Total
74 MM Capacity
EPD Equity Storage
3.1 MM Barrels
Seaway 30”
150 Basin 24”
450
PAA (Red River) to GW 10”
50
SEM to Ardmore 8”
17
ENB Spearhead 24”
195
SUN 6”
15
OXY 16”
130
PAA Cherokee 12”
30
Keystone 36”
600
SEM White Cliffs 12”
60
BP 20” to Whiting
180
Ozark 22/24”
270
Magellan West Tulsa 8”
30
Sun Tulsa 10”
60
COP Ponca 20”
100 PAA to CVR 16”
100
Osage 16”
160
COP Borger 12”
53
OXY Slaughter 16”
75
Inbound Pipelines
Outbound Pipelines
Inbound Capacity: 1,505 MBPD Outbound Capacity: 1,295 MBPD
EOG Stroud 12”
75
ENB Tulsa 10”
50
Source: EPD Internal Records
All rights reserved. Enterprise Products Partners L.P. 16
Cushing Storage Inventories
Sources: Reuters and EPD Fundamentals
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Sep
-10
Oct
-10
Nov
-10
Dec
-10
Jan-
11
Feb-
11
Mar
-11
Apr
-11
May
-11
Jun-
11
Jul-1
1
Aug
-11
Sep
-11
Oct
-11
Nov
-11
Dec
-11
Jan-
12
Feb-
12
Mar
-12
Apr
-12
May
-12
Jun-
12
Jul-1
2
Aug
-12
Sep
-12
Oct
-12
Nov
-12
Dec
-12
Jan-
13
Feb-
13
Mar
-13
Apr
-13
May
-13
Jun-
13
Jul-1
3
Aug
-13
Sep
-13
Oct
-13
Nov
-13
Dec
-13
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Sep-
10
Nov
-10
Jan-
11
Mar
-11
May
-11
Jul-1
1
Sep-
11
Nov
-11
Jan-
12
Mar
-12
May
-12
Jul-1
2
Sep-
12
Nov
-12
MB
bls
Cushing Crude Oil Inventories
Current storage Cushing Working Capacity
All rights reserved. Enterprise Products Partners L.P. 17
Seaway Reversal: Phase I
Phase I: reversal of existing Seaway pipeline Began southbound
service in May 2012 – Utilizes an existing
pump at Cushing Modifying to fully
reverse service by 1Q 2013
/ Port Arthur
/ Port Arthur
All rights reserved. Enterprise Products Partners L.P. 18
Seaway Reversal: Picture 1
All rights reserved. Enterprise Products Partners L.P. 19
Seaway Reversal: Picture 2
All rights reserved. Enterprise Products Partners L.P. 20
Seaway Loop: Phase II
New 65 mile 36” lateral pipeline to link Seaway to Enterprise’s ECHO Terminal
New 512 mile 30” pipeline from Cushing to Jones Creek
Combined capacity of 850 MBPD in mixed (heavy / light) service
New 85 mile 30” lateral pipeline from ECHO to the Beaumont / Port Arthur area
Supported by commitments of up to 20 years
Provide producer access to over 4 million barrels of demand from Gulf Coast refineries
Access to EPD’s ECHO Terminal
All rights reserved. Enterprise Products Partners L.P. 21
Houston ECHO Terminal
ECHO Terminal Property
Purchased 2/10/12
All rights reserved. Enterprise Products Partners L.P. 22
Houston ECHO Terminal
ECHO Terminal will connect Eagle Ford, Bakken, WTI, Mid-Continent, West Texas, Gulf of Mexico and foreign imports to Houston and Beaumont / Port Arthur Refineries Build out up to 6 MMBbls of storage
2013 NYMEX pricing point for the Houston market Pipeline operational storage and space for 3rd party merchant storage Significant marketing opportunities
EPD ECHO Crude Oil Terminal
Cushing, OK Crude Oil Complex
West Texas Crude Production
Eagle Ford Crude Production
South Texas Crude Production
Houston
Refining Complex
Texas City Refining Complex
Water Access to ≈5 million Bbls USGC Market (excl. Houston) Seaway Texas City
& Freeport Docks
Canadian / Bakken Crude Production
Beaumont / Port Arthur
Refining Complex
Source: EPD Fundamentals
All rights reserved. Enterprise Products Partners L.P. 23
Historical Forecast
Source: NYMEX
Not $5.00 until 2019
Crude Oil and Natural Gas Prices Stable and Competitive
All rights reserved. Enterprise Products Partners L.P. 24
Timeline to Energy Security
Sources: EIA and EPD Fundamentals
Liquid Petroleum Products (MBPD)
2007 2012 YTD
2020 EPD
U.S. Consumption (excl. exports) 20,700 18,500 19,000
U.S. Production (incl. refinery gain & renewables) 8,500 10,900 15,000
Net Imports Required 12,200 7,600 4,000
Net Imports from Canada / Mexico 3,500 3,100 4,000
Imports from Rest of World 8,700 4,500 -0-