Dakota Access, LLC Crude Oil Pipeline Project

Transcription

1 Dakota Access, LLC Crude Oil Pipeline Project

2 Legal Disclaimer This presentation may contain statements about future events, outlook and expectations of Energy Transfer Partners, L.P. (ETP), all of which are forwardlooking statements. Any statement in this presentation that is not a historical fact may be deemed to be a forward-looking statement. These forward-looking statements rely on a number of assumptions concerning future events that are believe to be reasonable, but are subject to a number of risks, uncertainties and other factors, many of which are outside the Partnership s control, and which could cause the actual results, performance or achievements of ETP to be materially different. While the Partnership believes that the assumptions concerning future events are reasonable, we caution that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of our businesses. These risks and uncertainties are discussed in more detail in the filings made by ETP with the Securities and Exchange Commission, copies of which are available to the public. ETP expressly disclaims any intention or obligation to revise or publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. 2

3 Agenda ENERGY TRANSFER OVERVIEW PROJECT OVERVIEW & PURPOSE PROJECT BENEFITS & FOOTPRINT UNION COMMITMENT TIMELINE SUMMARY QUESTIONS 3

4 Energy Transfer Overview Fully consolidated, ETE owns: Approximately 71,000 miles of natural gas and Natural Gas Liquids (NGL), refined products and crude oil pipelines today. Fifty-one (51) natural gas processing, conditioning and treating facilities. One hundred forty-two (142) Billion cubic feet (Bcf) of natural gas storage capacity. Forty-seven (47) million barrels of crude oil terminal capacity. Two (2) NGL fractionators (one (1) more under construction). One of North America s largest liquefied natural gas import terminals. 4

5 Energy Transfer Asset Overview Energy Transfer Asset Overview ETP Assets Marcus Hook SXL Assets Eagle Point Nederland Announced Projects Lake Charles LNG Trans-Pecos Mariner East Phase 2 Dakota Access Lone Star Express Ohio River System Crude Conversion Comanche Trail Rover Revolution System Bayou Bridge 5

6 ETCO DAPL System overview The most competitive Bakken takeaway alternative Approximately 1,172-mile, 30-inch diameter long-haul crude oil pipeline designed to provide transportation service from North Dakota to Patoka, Illinois Dakota Access Pipeline ( DAPL ) is anchored by a telescoping 12-inch to 30-inch diameter in-field transportation system that provides shippers unrivaled access to the Bakken / Three Forks production area Supplied by six strategically located receipt stations across the in-field system in North Dakota, creating a competitive advantage in facilitating customer access to the most prolific producing regions within the basin Patoka, Illinois, is a key market hub in PADD II, providing advantaged access to major Midwest and Ohio River Basin refineries 1,172 miles of new pipeline, with 30 mainline Approximately 749-mile crude oil pipeline, of which over 700 miles are 30-inch diameter crude oil pipeline, (1) designed to provide long-haul transportation service from Patoka, Illinois, to Nederland, Texas Energy Transfer Crude Oil Pipeline ( ETCO ) will originate at Patoka, Illinois, with anticipated connections for receipts from DAPL and multiple terminals at the Patoka Hub Destination of Nederland, Texas, with deliverability to the crude oil terminals of SXL and Phillips 66, resulting in access to Gulf Coast crude infrastructure, including access to ~6 MMBbls of refining capacity by pipeline, as well as access to water Nederland termination point combined with ocean transport alternatives provides a competitively priced and safer alternative delivery method to East Coast refineries relative to rail 749 miles of 24 and 30 pipeline converted to crude service, with 62 miles of new 30 and 686 of converted mostly 30 pipe (1) Delivery Points Receipt Stations DAPL ETCO Nederland Terminal SXL s Nederland terminal is the largest single crude terminal in the United States with capacity throughput over 2 MMBbls/d 6

7 Dakota Access Pipeline - Project Map 7

8 North Dakota Project Map Approximate Length Mountrail County Williams County McKenzie Dunn County Mercer County Morton County Emmons County 23 miles 70 miles 60 miles 52 miles 26 miles 71 miles 44 miles Total 346 miles 8

9 DAPL in-field system Access to most prolific region in the Bakken The DAPL in-field system provides unrivaled access to Bakken / Three Forks production DAPL s base scope includes approximately 2 MMBbls (working capacity) of operational storage across its six strategically located receipt stations Enables flexible receipts into DAPL from multiple existing gathering systems for each receipt station Underpins system reliability, in conjunction with segment throughput rates across infield, to minimize potential service interruptions DAPL will have individual metering for each incoming carrier, combined with manifold configuration and operational tankage, at all six receipt stations Plan for multiple connections at each station Stations located in Mountrail, Williams and McKenzie counties DAPL Asset Map Legend DAPL receipt stations Dakota Access Pipeline EPPING inch 20-inch 150 TRENTON inch WATFORD CITY RAMBERG STANLEY inch JOHNSON S CORNER inch 30-inch 200 9

10 Project Purpose and Need Improves Overall Safety to the Public and Environment. The Dakota Access Pipeline will reduce crude oil shipped by truck and rail, increasing public safety. Pipelines are the safest and most efficient means to transport crude oil, according to the U.S. Department of Transportation. Increase America s Energy Security. Dakota Access has a planned capacity of 570,000 barrels per day that will provide a long-term safe, reliable and efficient pipeline to move domestic crude oil from the Bakken and Three Forks to market. Provide Reliable Transportation Network for Crude Oil from Bakken. Gulf Coast and East Coast refineries will have better access to reliable U.S. crude oil production to meet U.S. consumer needs for gasoline, diesel fuel and other petroleum products. Ease Transportation Constraints for Agricultural Product. Dakota Access will free-up rail capacity for commodity crop transportation currently curtailed by crude oil cargos. 10

11 Project Benefits $3.78 Billion Investment Into the Overall US Economy Materials = ~$1.2 billion Right-of-Way = ~$0.2 billion Construction and Project Labor = ~$2 billion Other = ~$0.4 billion Up to 12,000 American Jobs along the Route. Millions of hours of labor will be needed during the construction phase, putting welders, mechanics, electricians, pipefitters, heavy equipment operators and others within the heavy construction industry to work. Approximately 4,000 Construction Jobs in North Dakota. Dakota Access will support North Dakota construction jobs and service jobs (to support construction workforce) largely filled with local union labor. 40 to 50 permanent jobs along the entire pipeline route Union Commitment. Dakota Access is working with LiUNA to source 100% union labor with up to 50% of the workers sourced from local union halls. Hundreds of millions of dollars will be spent in construction labor payment to North Dakota. 11

12 Union Commitment In Q2/Q Energy Transfer reached out to the major trade unions in the United States to develop and solidify a strategic alliance to accomplish the following: Key contact with LiUNA (Greg Davis) who was the instrumental leader in establishing an agreement with Energy Transfer to work together on our critical projects. Obtain labor commitments for projects combined mega Energy Transfer projects in 2016 and 2017 require around 27,000 persons at peak construction. Work with each trade union early to ensure there are adequate numbers of skilled and trained staff within each union to support projects commitment made two years in advance of projects. Gain unparalleled national support network to combat anti-pipeline or anti-fossil fuel agenda. Provide political pressure and factual data to all interested parties along proposed pipelines at local, state and federal levels of government to insure a fair and timely approval process. Attend and provide support at public meetings, government sponsored open houses and hearings. At national level, vocalize support of the projects with the congressional delegation. Provide alternate message of support in media outlets along pathways of projects to provide counteropinion (e.g. newspaper editorials and interviews). 12

13 North Dakota Project Benefits Provide Valuable Tax Dollars for Short- and Long-Term. The pipeline will translate into millions in state and local revenues during the construction phase, including sales and income tax payments and local property tax payments. These tax dollars can be used to support schools, hospitals, emergency services and other critical ongoing needs. Economic Benefit to North Dakota in Local Taxes/Payments $1.4 billion North Dakota capital investment. $32.9 million estimated North Dakota state sales tax during construction $1.7 million estimated local sales tax revenue generated during construction $13.1 million estimated North Dakota property taxes for its first year in operation Majority of Pipeline Purchased, Manufactured and Assembled in the U.S. This will contribute an estimated $1 billion in direct spending to the U.S. economy. There will also be increased demand for those who manufacture the steel pipes, fittings, valves, pumps and control devices necessary for a major pipeline. All mainline pumps will be assembled and packaged in the United States, 57% of the pipe itself will be manufactured in the U.S. and the majority of the remaining major materials will be purchased, manufactured or assembled in the United States 13

14 Project Footprint Right of Way. The pipeline will parallel existing pipelines, power lines, or existing roads where possible. During construction, an additional feet of workspace may be needed adjacent to a 50-foot permanent easement. Pipeline Footprint. The pipeline will be covered by a minimum of 36 inches of soil and more if it crosses under roads, rivers, lakes or streams. Buried under a minimum of 48 inches on agricultural land. Drain tiles will be crossed with a minimum of 24 inches of separation between the pipe and the drain tile. Topsoil will be segregated during construction to a minimum of 12 inches or in accordance with landowner requirements. Routing Analysis. Civil, environmental and cultural resource surveys were performed along the four-state route. The current pipeline route corridor is the best route which balances the constructability and safe operation of the pipeline, minimizes the environmental impact, and provides economic development opportunity for local communities/businesses. Safety and Monitoring. We will operate the pipeline safely and monitor it around the clock. We intend to protect the communities where we operate, the environment, and our infrastructure by maintaining a safe and reliable pipeline system that the public and our customers can rely upon. The pipeline system will receive regular integrity testing and will be equipped with advanced technology including remotely monitored instrumentation and remotely actuated valves. 14

15 Right of way status DAPL Asset Name State Number of Tracts Survey Survey Permission Granted R O W Acquired Number of Miles DAPL North Dakota % % 359 DAPL South Dakota % % 275 DAPL Iowa 1,277 1, % 1, % 348 DAPL Illinois % % 190 Report Totals: 3,685 3, % % 1,172 Survey R O W ETCO Asset Name State Number of Tracts Survey Permission Granted Acquired Number of Miles ETCO Illinois % % 31 ETCO Texas % % 32 Report Totals: % % 63 15

16 Construction Contractors Secured top-tier expertise in crude oil tank and large-diameter mainline pipe construction Construction area DAPL Supply-Area Terminals DAPL Pump Stations DAPL Pipeline - ND DAPL Pipeline - SD DAPL Pipeline - Iowa DAPL Pipeline - Illinois ETCOP - Northern New Build ETCOP - Southern New Build ETCOP - South Portion Conversion ETCOP - North Portion Conversion ETCOP Pump Stations Construction company Matrix Service Michels Construction Precision Pipeline Michels Construction Precision Pipeline Precision Pipeline Precision Pipeline Progressive Pipeline Construction WHC Precision Pipeline EMS 16

17 Construction Status Tank Farms Roughly 2 million barrels of storage capacity at 6 sites with multiple header connections to existing or proposed gathering pipeline systems Commenced construction January 21, 2016 Contractor (tanks, pumps and meters) - Matrix Mechanical Completion Q Commercial or In-service January 2017 Mainline Pump Stations One mainline station located at Johnson Corner, McKenzie County Mainline Pump Station Michels Corporation Commenced construction May 16, 2016 Mechanical Completion Q Commercial or In-service January 2017 Pipeline DAPL ND Section ETCOP 90% complete ND = Spreads 6, 7, 8 and 9 Spread 6 (roughly 50 miles to Missouri River - Michels Corporation Spread 7, 8 and 9 Precision Commenced construction May 16, 2016 Mechanical Completion Q In-service January

18 Construction Spreads 18

19 Construction Spreads 19

20 Construction Spreads 20

21 Tank Terminal Construction 21

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23 Dakota Access Timeline ETP Files Iowa IUB Application (Jan 2015) South Dakota State Agency Approval (Nov 2015) North Dakota State Agency Approval (Jan 2016) DAPL Construction Sept/Oct 2014 Dec 2014 Feb 2015 April 2015 Oct 2015 Dec 2015 Feb 2016 Dec 2016 DAPL Open Houses (S.D., N.D., Illinois) DAPL Open Houses (Iowa) ETP Files S.D., N.D., Illinois Applications Public Comment Periods on N.D., S.D., Iowa, Illinois Applications (Feb May 2015) Illinois State Agency Approval (Dec 2015) Iowa State Agency Approval (Mar 2016) DAPL Operational 23

24 Questions? Thank You 24