Logistics Services for the Heavy Oil Sector Peters & Co. 2013 - PowerPoint PPT Presentation

Logistics Services for the Heavy Oil Sector Peters & Co. 2013 Energy Conference David G. Smith, President and COO

Forward-Looking Information In the interests of providing Keyera Corp. (“Keyera” or the “Company”) shareholders and potential investors with information regarding Keyera, including Management’s assessment of future plans and operations relating to the Company, this document contains certain statements and information that are forward-looking statements or information within the meaning of applicable securities legislation, and which are collectively referred to herein as “forward-looking statements". Forward-looking statements in this document include, but are not limited to statements and tables (collectively “statements”) with respect to: capital projects and expenditures; strategic initiatives; anticipated growth and performance; anticipated producer activity and industry trends; geological predictions such as the future importance of the WCSB as a source of gas supply and future demand for condensate;; anticipated timing associated with capital projects and future revenue streams; and objectives of or involving Keyera. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, as well as known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur and which may cause Keyera’s actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by the forward-looking statements. These assumptions, risks and uncertainties include, among other things: Keyera’s ability to successfully implement strategic initiatives and whether such initiatives yield the expected benefits; future operating results; fluctuations in the supply and demand for natural gas, NGLs, crude oil and iso-octane; assumptions regarding commodity prices; activities of producers, competitors and others; the weather; assumptions around construction schedules and costs, including the availability and cost of materials and service providers; fluctuations in currency and interest rates; credit risks; marketing margins; potential disruption or unexpected technical difficulties in developing new facilities or projects; unexpected cost increases or technical difficulties in constructing or modifying processing facilities; Keyera’s ability to generate sufficient cash flow from operations to meet its current and future obligations; its ability to access external sources of debt and equity capital; changes in laws or regulations or the interpretations of such laws or regulations; political and economic conditions; and other risks and uncertainties described from time to time in the reports and filings made with securities regulatory authorities by Keyera. Readers are cautioned that the foregoing list of important factors is not exhaustive. The forward-looking statements contained in this document are made as of the date of this document or the dates specifically referenced herein. For additional information please refer to Keyera’s public filings available on SEDAR at www.sedar.com. All forward-looking statements contained in this document are expressly qualified by this cautionary statement. 2

About Keyera (TSX:KEY) • Strong track record of income and growth compound annual 22% total return 1 • Disciplined approach to value creation to shareholders • Stable cash flows from largely fee-for-service activities • Proven operational expertise CAGR 3 in 8.1% dividends • Strategically positioned assets per share • Exciting growth opportunities tied to our integrated business lines: – Focus on liquids-rich drilling $2.40 11 dividend – Increasing demand for oilsands services per share per increases since IPO in 2003 year 2 1 From May 30, 2003 to May 31, 2013 2 Effective with August dividend payable September 16, 2013 3 From June 24, 2003 to August 31, 2013 One of Canada’s Largest Midstream Operators 3

Integrated Business Lines – Superior Service Offering * Includes intersegment transactions. See Keyera’s Second Quarter 2013 MD&A for a definition of Operating Margin. Delivering Midstream Energy Solutions Along the Value Chain 4

Growing the Business Operating Margin 1,3 EBITDA 2,3,5 $ Millions $ Millions $400 $400 $350 $350 $300 $300 $250 $250 $200 $200 74% $150 $150 Fee-for-service 4 (66% YTD 2013) $100 $100 $50 $50 $0 $0 2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 NGL Marketing - margin based Dividends ⁴ EBITDA NGL Infrastructure - fee-for-service Gathering & Processing - fee-for-service 1 Operating margin excludes other income from production. 2 Non-GAAP measure. 3 See Keyera’s Q2 2013 MD&A for a definition of operating margin and EBITDA. 4 Fee-for-service operating margin includes fees paid by Marketing to NGL Infrastructure. 5 2009 normalized to exclude $29.2 million paid out as a special dividend. Fee-For-Service Business Underpins Cash Flow for Dividends 5

Gathering and Processing Business Unit MONTNEY • Well maintained, long-life facilities – 2.4 Bcf/d licensed gross capacity – Keyera operates 14 of 15 plants – NGL extraction capability at 95% of plants • Extensive gathering systems DUVERNAY – ~4,000 km of 4”-12” diameter pipelines – Capture areas create franchise regions • Fee-for-service revenues with negligible direct commodity exposure – Largely flow-through operating costs CARDIUM GLAUCONITE Franchise Facilities in the Right Locations 6

Liquids Business Unit • NGL Infrastructure is a fee-for-service business providing: – 80,000 bbls/d of fractionation capacity at 5 locations – Rail & truck handling facilities at 17 Locations, including a 1,300+ rail car fleet – 11.4 million barrels of underground storage at 12 caverns plus >300,000 barrels of above ground storage – Iso-octane production at Alberta EnviroFuels • Marketing provides various support services including: – Purchasing propane, butane and condensate from producers in western Canada and the U.S. – Fractionating NGL mix into spec products – Storing NGLs as required to meet demand and operational fluctuations – Utilizing Keyera’s integrated facilities and logistics expertise to move spec products to markets across North America 7

Strong Suite of Growth Opportunities Operational Under Development Under Evaluation • New gas gathering pipelines • Rimbey turbo-expander • Gas gathering pipelines • Turbo expander at Strachan • Wapiti pipelines (2 x 90 km) • Enhancing NGL recoveries at gas plants • Turbo expander at MBL • Simonette modifications • Future Simonette expansion • ADT moved to 24/7 operations • Strachan sulphur expansion • Rail loading terminals • Kearl contract – diluent and • Alberta Crude Terminal solvent handling • South Cheecham expansion • Hull Terminal refurbishment • AEF (acquired in 2012) • Norlite diluent pipeline to oilsands • South Cheecham Rail and Truck • Iso-octane deliveries by rail to Terminal • Alberta Liquids Pipeline System • 4 th brine pond at KFS market • Hull Terminal expansion • 12 th storage cavern • 13 th storage cavern at KFS • NGL frac expansions • KFS de-ethanizer Growth Projects Increasing Cash Flow 8

Significant Organic Growth Projects Underway Capital Cost $ Millions 1 Projects 2013 2014 2015 Rimbey turbo expander 210 Wapiti raw gas and condensate pipelines 155 Simonette plant modifications 90 Strachan sulphur projects 65 South Cheecham Rail & Truck Terminal 68 Fort Saskatchewan de-ethanizer 111 Alberta Crude Terminal 65 Hull Terminal refurbishment 35 Fort Saskatchewan storage projects 29 Total 828 1 Keyera’s share of estimated capital cost. See Keyera’s Q2 2013 MD&A for capital investment risks and assumptions. 2013 Growth Capital Budget 1 - $400 million to $450 million 9

Diluent Business Opportunity Viscosity at Room Temperature (cP) • Bitumen must be thinned with a lighter Athabasca hydrocarbon, called diluent, for Bitumen Peanut 1,000,000 movement via pipeline Butter Cold Lake Bitumen • Majority of future bitumen production 100,000 Ketchup will be transported by pipeline to Honey upgraders 10,000 Pancake Syrup – Condensate is diluent of choice 1,000 – Approximately 1 barrel condensate is Olive blended with 3 barrels of bitumen Oil 100 Light Crude Oil 10 Water 1 0 Source: Imperial Oil Keyera Ideally Suited to Provide Diluent Handling Services 10

Diluent Imports Required to Meet Oilsands Growth 11

Providing Customers with Significant Receipt and Delivery Flexibility Keyera’s Fort Saskatchewan Condensate System • Diluent transportation, storage and terminalling services in Edmonton/Fort Saskatchewan • Connections to access all diluent streams in Alberta • Strong service offering attracting new business: • Kearl (Imperial Oil) – 25-year diluent transportation services began July 2012 – 15-year storage services agreement • Sunrise (Husky Oil/ BP) − Services to begin in 2014 − Storage and transportation agreement • Other deals being negotiated 12