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a meaningful companydoing meaningful workdelivering meaningful results
Jim ClearyPresident, El Paso Western Pipelines
Platts Conference, Rockies Gas & OilApril 27, 2007
2
• Overview of Rockies Position in North American Market
• Rocky Mountain Production
• Pipeline Capacity and Constraints
• Current & Future Expansions, Capabilities and Timing
Outline
3
WICCIGEPNGMojaveCheyenne Plains
Green RiverDenver-Julesburg
AnadarkoRaton
Uinta
Powder River
Permian
Big Horn
Wind River
Piceance
El Paso Western Pipelines
San Juan
4
Demand Growth Tilts East and North5.45.56.67.5
9.19.5
10.911.8
8.79.0
11.413.216.6
13.314.815.3
3.94.55.55.9
11.610.611.311.3
Mexico
WesternCanada Eastern
Canada NW and
Alaska
6.35.76.87.2
2.72.52.72.9
3.85.05.86.6
Maritimesand
Northeast U.S.
3.43.33.94.3
N.A. Total
2000 76.2
2005 72.9
2010 84.0
2015 90.5
Bcf/d
4.84.14.34.5
-0.6%
2.8%
2.2%
0.6%
0.9%
2000-2015
CAGR
1.8%
1.5%
2.8%
1.1%3.7%
-0.4%
-0.1%
2000200520102015
1.5%
2005-2015
CAGR
1.1%
3.9%
2.2%
2.6%
3.1%
1.4%
2.8%
2.7%2.3%
2.2%
0.7%
Source: El Paso
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Supply Growth Tilts West and SouthBcf/d
N.A. LNGImports
2000200520102015
Western Canada
17.317.617.516.9
Rockies
Mid-Continent
EasternCanada
Mexico
Gulf ofMexico
Onshore Gulf
1.21.21.2 1.2
14.09.3
10.09.1
0.30.50.40.2
5.94.44.13.5
4.87.19.9
10.65.24.95.14.8
3.54.14.54.1
0.61.77.313.6
Source: El Paso
0.00.00.0 1.0
Alaska Mackenzie
Permian
4.04.14.34.3
San Juan
3.93.73.53.3
Shale Plays /
Carthage5.37.39.7
10.7
6
0
2,000
4,000
6,000
8,000
10,000
12,000
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Big Horn Wind River
Green River Overthrust
Powder River Uinta
Piceance Denver
Rocky Mountain Production(Volumes are Wellhead – Measured in MMcfd)
1990-2005: Wellhead total data from IHS database2006: Estimate2007-2015: El Paso forecast
Forecast by 2015:
High Case 12,873 Mid Case 10,773Low Case 8,673
Forecast
2.46 Bcf/d ofgrowth 2006-2015
7
650
2,000
360
265
400
435
330180
East CapacityTrailblazer 850KMI 400CIG* 330C. Plains 730Southern Star 180WBI 265Total 2,755West Capacity
NWP North 650NWP South 360Kern 2,000TransColorado 435Total 3,445
* Excludes capacity from Raton** West/East X-Over Capacity includes REX West by 2007
Northern Rockies Export Capacitywith Recent Expansions*
730
850
Approximately 6.2 Bcf/d
3170**
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Rockies Gas BalanceMMcf/d
Annual Average Wellhead Production Forecast2001 2002 2003 2004 2005 2006E 2007 2008 2009 2010
Dry Production 5,136 5,615 5,961 6,378 6,773 7,168 7,601 7,964 8,261 8,502
Local Consumption* 1,547 1,575 1,548 1,591 1,637 1,613 1,695 1,612 1,701 1,726
Available for Export 3,589 4,040 4,413 4,787 5,136 5,556 5,906 6,352 6,560 6,776
Total Export Capacity 3,633 3,869 4,738 5,397 6,030 6,200 6,200 8,000 8,000 8,000
Capacity Surplus 43 -171 325 611 894 644 294 1,648 1,440 1,224
% Surplus Capacity 1.2% -4.4% 6.9% 11.3% 14.8% 10.4% 4.7% 20.6% 18.0% 15.3%
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Cheyenne Basis to Henry Hubversus Export Load Factors
-0.50
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
60.0% 65.0% 70.0% 75.0% 80.0% 85.0% 90.0% 95.0% 100.0%
Do
llars
per
MM
Btu
Jan 1995 – Mar 2007
Historical RelationshipLoad Factor ~84%
HH Hub Basis ~ $0.71
Source: El Paso
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Jan05-Mar07
Rockies Export PipelinesUtilization Rates
0%
20%
40%
60%
80%
100%
120%
Jan-
05
Feb
-05
Mar
-05
Apr
-05
May
-05
Jun-
05
Jul-0
5
Aug
-05
Sep
-05
Oct
-05
Nov
-05
Dec
-05
Jan-
06
Feb
-06
Mar
-06
Apr
-06
May
-06
Jun-
06
Jul-0
6
Aug
-06
Sep
-06
Oct
-06
Nov
-06
Dec
-06
Jan-
07
Feb
-07
Mar
-07
% U
tiliz
atio
n R
ate
Weighted Average of Rockies Pipelines to the East Weighted Average of Rockies Pipelines to the West
Weighted Average of All Rockies Pipelines
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Northern Rockies BasinsEast & West of Pipeline Divide
Anadarko
Denver Basin
PowderRiver
Big Horn
Wind River
San Juan
Paradox
Uinta
Piceance
Overthrust
Raton
Green River
Continental Divide
Pipeline Divide
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Rockies Supply vs.Regional Export Capacity
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
100% LF
85% LF
Supply Available for ExportBase Case
MMcf/d
Cheyenne Plains 170 expansion
Cheyenne Plains 560 expansion
Expansion needed:
2011 if 85% LF
2015 if 100% LF
REX West1800 expansion
High CaseCP Midpoint70 expansion
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El Paso Provides Infrastructure SolutionsRecent Rockies Expansions
Expansion Projects Capacity (Mdth) In Service
Raton BasinRaton Phase I 11 Dec 1994Campo Lateral 81 Sep 1998Raton Phase II 120 Sep 2001Raton Phase III 45 Sep 2002Raton Phase IV 110 Oct 2005
Power RiverMedicine Bow 260 Dec 1999Medicine Bow II 120 Aug 2000Medicine Bow Loop 655 Dec 2001
Uinta BasinUinta Lateral 200 Dec 1992Piceance BasinParachute Creek Lateral 37 Oct 1996WIC Piceance 350 Apr 2006
Green RiverWIC – Overthrust 300 Jan 2006
Rockies ExportCheyenne Plains 560 Dec 2004Cheyenne Plains Expansion 170 Jan 2006Cheyenne Plains Yuma Lateral 50 Dec 2006
(Contracted Volumes)
3,169
14
Western PipelinesExpansion Projects Summary
December 2008 /July 2009(Projected)
$296 MM164 miles of 30”/24”9,400 Hp
900 MDth/d7 Bcf
CIG High Plains Pipeline / Totem Storage
December 2007(Projected)
$12 MM11 miles of 24”/20”29 MDth/dCIG Raton Basin 2007 Expansion
24,300 Hp
10,300 Hp
128 miles of 24”20,600 Hp
Description
$32 MM
$503 MM
$20 MM
$143 MM
Project Cost
July 2008(Projected)
350 MDth/d
1,749 MDth/d
WIC Medicine Bow Expansion
TOTAL
March 2008(Projected)
70 MDth/dCP Midpoint Expansion
January 2008(Projected)
400 MDth/dWIC Kanda Lateral
In-ServiceCapacityProject
15
Infrastructure Challenges
• Rising Steel Cost
• Increasing Construction Costs
• Permitting Constraints
• Environmental Stewardship
16
Steel Plate Price per Net Ton
$450
$800
$850
$900
$0 $200 $400 $600 $800 $1,000
2003
2004
2005
2006
Cost? Timely? Manpower?
How will infrastructure get built?
Source: Berg Steel Price (X-70 Plate)
17
WIC Piceance Lateral ConstructionJanuary 2006
18
WIC Piceance Lateral ConstructionJanuary 2006
19
Cheyenne Plains ConstructionSummer 2005
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Conclusion – Key Points
• Rockies Potential in North American Market
– Key growth area of domestic supply
– Surpasses GOM Offshore
• Rocky Mountain Production
– Increase of 2.5 Bcf/d by 2015
– Expect average YoY production growth to 2030
• Pipeline Capacity and Constraints
– Rockies Express 1.8 Bcf/d in service by 2008/2009
– Additional intra/inter Rockies capacity need by 2011-2012
– Expect significant basis impact until REX West in service in 2008
• Current and future expansions, capabilities and timing
– Key projects are on the horizon that will provide temporary relief; however, continued Rockies production growth will require additional expansions
21
This presentation includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The company has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this presentation, including, without limitation, our ability to successfully contract, build and operate the pipeline projects described in this presentation; changes in supply of natural gas; general economic and weather conditions in geographic regions or markets served by El Paso Corporation and its affiliates, or where operations of the company and its affiliates are located; the uncertainties associated with governmental regulation; competition, and other factors described in the company’s (and its affiliates’) Securities and Exchange Commission filings. While the company makes these statements and projections in good faith, neither the company nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. The company assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the company, whether as a result of new information, future events, or otherwise.
Cautionary Statement RegardingForward-looking Statements