cibc whistler investor conference corporate profile...–ngl extraction capability at 95% of plants...

CIBC Whistler Investor Conference

Corporate Profile

January 2014

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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 producer activity and industry trends; and

anticipated performance. 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.

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7.8% CAGR2 in dividends per share $900MM

Approximate Growth Capital for 2013/20143

Providing Investors with Income and Growth

Keyera (TSX:KEY) – Strong History of Financial Performance

3

2 From 07/15/2003 to 12/31/13

21.9% Compound annual

TSR1

1 From 05/30/03 to 12/31/13

3 Assuming timely receipt of approvals and no construction delays

$100

$200

$300

$400

$500

$600

$700

$800

$900

Total Cumulative Return of $100 Investment Since 2003

KEY S&P/TSX Composite


Large Resource Base Supports Long-Term Business Viability

Keyera - One of the Largest Midstream Operators in Canada

4

2 From 07/15/2003 to 09/30/13 1 From 05/30/03 to 09/30/13

3 Assuming timely receipt of approvals

and no construction delays

• Natural gas producers require significant infrastructure to support growing natural gas activity

Liquids-rich natural gas production

• Bitumen producers require diluent handling and other logistics services

Oil sands development

Keyera Business Driver Canadian Industry Focus


Delivering Midstream Energy Solutions Along the Value Chain

Integrated Business Lines – Superior Service Offering

5

* Includes intersegment transactions. See Keyera’s Third Quarter 2013 MD&A for a definition of Operating Margin.


Significant Growth Investments Available and Underway

6

Alberta EnviroFuels

(AEF) 2012 Acquisition

Turbo Expander at

Strachan and MBL

Alberta Diluent Terminal

(ADT) 24/7 Operations

South Cheecham Rail

and Truck Terminal

12th Storage

Cavern

Fort Saskatchewan

Condensate System

Delivering

Iso-Octane by Rail

New Gas

Gathering Pipelines

Alberta Crude

Terminal

Rimbey

Turbo Expander

Wapiti Pipelines

(2 x 90km)

Simonette

Modifications

Strachan Sulphur

Expansion

Hull, Texas

Terminal Refurbishment

New Gas

Gathering Pipelines

13th and 14th

Storage Caverns

KFS

De-ethanizer

KFS Fractionation

Expansion

4th Brine

Pond

Norlite Diluent Pipeline

to Oilsands South Cheecham

Expansion

Hull, Texas

Terminal Expansion

New Gas

Gathering Pipelines Alberta Liquids Pipeline

System (ALPS)

Simonette

Future Expansion

New Rail

Terminals

Enhancing NGL

Recoveries at Gas Plants Future Storage

Caverns

ACT Future

Expansion

Under Evaluation Under Development Operational

Cochin Pipeline

Tie-In at KFS


Growth Projects Currently Under Development

Projects

Capital Cost

$ Millions1 2013 2014 2015 2016

Rimbey turbo expander 210

Wapiti raw gas and condensate pipelines 180

Simonette plant modifications 90

Strachan sulphur projects 65

Gas gathering pipelines 26

Fort Saskatchewan de-ethanizer 120

Alberta Crude Terminal 65

Hull Terminal refurbishment 35

Fort Saskatchewan storage projects 34

Fort Saskatchewan fractionation expansion 170

Total 995

The Largest Capital Program in Keyera’s History 7

1 Keyera’s share of estimated capital cost. See Keyera’s Q3 2013 MD&A for capital investment risks and assumptions.


Liquids-Rich Development Expected to Drive Facility Expansions

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• 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

– ~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

• Expansion of gas processing and liquids handling capacity, as well as addition of gas gathering pipelines, expected

MONTNEY

CARDIUM

DUVERNAY

GLAUCONITE

Gathering and Processing Business Unit


Keyera Well Positioned to Provide Services to Montney Producers

Montney – A World Class Resource

9

2 From 07/15/2003 to 09/30/13 1 From 05/30/03 to 09/30/13 3 Assuming timely receipt of approvals

and no construction delays

1 Source: National Energy Board; BC Oil Gas Commission; Alberta Energy Regulator; British Columbia Ministry of Natural Gas Development

• Large portion of western Canadian natural gas production currently coming from the Montney

• Horizontal drilling / multi-stage completions enabled economic development

• Recent Montney study1 estimates marketable volumes of:

– 449 Tcf of natural gas

– 14 billion Bbls of NGLs & 1 billion Bbls of oil

• Montney a traditional sandstone/siltstone reservoir – not a shale

• Near-term focus will be liquids-rich areas such as Wapiti, Elmsworth, Simonette

• This formation expected to be the key zone underpinning west-coast LNG projects


New Area Experiencing Significant Liquids-Rich Development

Simonette – Expanding to Handle New Gas Production

• Opening new capture area northwest of plant in Wapiti / Elmworth area activity where producers drilling liquids-rich Montney zone

• Building two 90-km pipelines; a 12-inch sour gas gathering pipeline and a 6 inch condensate pipeline

• Modifying plant to add 100 MMcf/d of processing capacity & improve condensate handling

• Pipeline capital cost ~$180 million, including inlet separation; anticipate pipelines on stream by Q2 20141

• Plant capital cost estimated at ~$90 million, including condensate stabilization; anticipate plant expansion start up in second half 20141

1 Assuming construction schedule is met.

10

Producers active in area

• NuVista

• Paramount

• 7 Generations

• Sinopec Daylight

• Harvest

• Exxon Mobil

• CIOC


Northern Duvernay Region Requires Significant Infrastructure

• Emerging natural gas resource development east of Simonette

• Initial indications are that Duvernay gas contains high levels of condensate and other NGLs

• Significant infrastructure required to develop resource

– Raw gas processing

– Condensate stabilization

– NGL mix transportation to Fort Saskatchewan

– Additional NGL fractionation

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Sources: Peters & Co. Limited ,geoSCOUT.

Northern Duvernay – Potential World Class Resource

Producers active in

Simonette/Kaybob area

• Exxon Mobil

• Athabasca Oil Corp.

• Encana

• Trilogy

• Chevron

• Shell

• ConocoPhillips

• Yoho


Can Development be Accelerated to Take Advantage of Existing Infrastructure?

Southern Duvernay – Significant Infrastructure in Place Today

• Keyera is well positioned

– 10 plants (1.9 bcf/d processing capacity and liquids recovery)

– Extensive gathering systems in place

• Existing deep-cut capacity at Rimbey, Gilby, Strachan and Minnehik Buck Lake gas plants

• Full fractionation at Rimbey plant for plant and trucked-in NGL mix

• Access to Edmonton/ Fort Saskatchewan NGL market via pipeline from Rimbey gas plant

• Ethane from Rimbey to Alberta Ethane Gathering System (AEGS) for delivery to Alberta’s petrochemical facilities

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Sources: Peters & Co. Limited ,geoSCOUT.

Producers active in the

West Central Area:

• Encana.

• Shell

• Talisman

• Sinopec Daylight

• ConocoPhillips

• Vermilion

• Enerplus

• Bonavista


Plant Enhancements Support Producer Netbacks 13

Enhancing Liquids Extraction at Rimbey

• Adding 400 MMcf/d turbo expander to enhance liquids extraction

– Ethane capacity 20 Mbbls/d

– Project underpinned by long-term ethane purchase agreement

– Gross capital ~$210 million

– Expected start-up in 2014

• Expansions supported by Glauconite production

• Potential to expand plant capacity with some capital investment


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, including a 1,500+ rail car fleet

– 11.4 million barrels of underground storage in 12 KFS caverns plus >300,000 barrels of above ground storage

– Iso-octane production at Alberta EnviroFuels

• Marketing provides various support services including:

– Purchasing and fractionating NGL mix into spec products (propane, butane, and condensate)

– 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

Strategically Integrated Assets at the Edmonton/Fort Saskatchewan Energy Hub 14


Oil Sands – Multi-Decade Resource1

• Canada has 3rd largest oil reserves in world; 97% are in the oil sands

• Reserve base of 168 Billion barrels recoverable represents approximately half of world oil reserves not under sovereign control

• 97% of oil sands surface area (81% of oil sands reserves) are recoverable using in-situ technology, with limited surface disturbance

Oil Sands Producers Will Require Diluent Transportation, Storage and Terminalling

Services

15

1 Source: CAPP


Providing Customers with Significant Receipt and Delivery Flexibility • 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/ BP)

− Services to begin in 2014

−Storage and transportation agreement

16

Keyera’s Fort Saskatchewan Condensate System


Meeting the Growing Rail Needs of Canadian Oil Sands Producers

South Cheecham Terminal – Extending our Logistics Footprint

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• South Cheecham Rail and Truck Terminal completed in Q3, 2013

• Ownership Keyera 50%, Enbridge 50%

• Terminal capable of receiving diluent and solvents and loading dilbit and bitumen onto railcars for delivery to upgraders

• Agreements in place with Statoil and JACOS

• Gross costs of ~$124 million

• Evaluating facility expansion


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Alberta Crude Terminal – Developing Crude By Rail Loading in Edmonton Area

• 50/50 partnership with Kinder Morgan

• Access to all crude qualities from Kinder Morgan

• Project underpinned by Irving Oil

• Served by CN and CP railways

• 40,000 Bbls/d crude oil loading facilities

• Potential for up to 125,000 Bbls/d incremental capacity

• Net capital cost to Keyera of ~$65 million; anticipate online in Q2 20141

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1 Assuming construction timelines are met.


An Opportunity to Expand our Condensate Service Offering

Norlite Pipeline – Leveraging our Condensate Infrastructure

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• Enbridge proceeding with development of Norlite pipeline, a diluent pipeline from Fort Saskatchewan to Athabasca oil sands region

• Norlite shippers may access Keyera’s condensate infrastructure in Edmonton/Fort Saskatchewan region

• In addition to pipeline capacity, shippers may need other Keyera services, such as storage and rail terminalling services

• Keyera currently evaluating its right to participate as a 30% non-operating owner

• As an owner, Keyera’s share of capex could be ~$400 million


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Adding De-ethanization at KFS

• Adding a 30 Mbbls/d de-ethanizer at Keyera’s Fort Saskatchewan Fractionation and Storage Facility (KFS)

• Project will enable fractionation of an ethane-rich stream of NGLs (C2+ mix) and increase the flexibility of KFS

• Creates specification ethane for consumption by Alberta’s petrochemical industry

• Project underpinned by a large deep basin producer

• Gross costs of ~$155 million, including pipeline connections and conversion of cavern to C2+ raw feed storage

• Expected on-stream in 2nd half 20141



Continuing to Grow our Fort Saskatchewan Energy Complex

Expanding C3+ Fractionation at Fort Saskatchewan

• Producers increasingly looking for NGL fractionation and marketing services tied to natural gas processing services

• Alberta fractionators, including Keyera’s, are operating near capacity

• Adding 35,000 Bbls/d C3+ fractionation capacity and other ancillary facilities

• Long-term agreements in place; negotiating agreements with producers for remaining capacity

• Gross project cost ~$220 million

• Anticipate online Q1 20161

21



Strong Balance Sheet for Growth and Flexibility

Conservative Capital Structure

22

Laddering of Maturities Reduces Financing Risk3

Key Debt Metrics

1.8 x Net debt 1 / LTM EBITDA1

11% Net debt 1 / Enterprise value2

1 Net debt was $681.0 million and is net of working capital and LTM EBITDA was $374.9 million. As at Sept 30, 2013 (adjusted for IFRS and non-GAAP measure. See Keyera’s Q3 2013 MD&A for comparable

GAAP measure). 2 Enterprise value based on January 20, 2014, closing prices: $66.76 (KEY)

3 All USD debt translated at their SWAP rate. 4 Funding of $75 million due in 2029 is expected to occur in April, 2014

$46 $97

$60

$125 $109

$60

$143

$264

$167

$75

$0

$50

$100

$150

$200

$250

$300

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

$C

AD

MM

Existing Senior Notes Senior Notes4


Fee-For-Service Business Underpins Cash Flow for Dividends

Stable and Growing Business

1 Operating margin excludes other income from production.2 Non-GAAP measure. 3 See Keyera’s Q3 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. 6 At September 30, 2013

$0

$50

$100

$150

$200

$250

$300

$350

$400

2008 2009 2010 2011 2012 2013 YTD

NGL Marketing - margin based NGL Infrastructure - fee-for-service

Gathering & Processing - fee-for-service

4

Operating Margin1,3

$ Millions

23

$0

$50

$100

$150

$200

$250

$300

$350

$400

2008 2009 2010 2011 2012 2013 YTD

EBITDA Dividends

EBITDA2,3,5

$ Millions

4

6 6

5


Trading Metrics

24

KEY Trading Symbols (TSX)

$66.76 Common Share Price1

$5.3 B Market Capitalization1

$6.0 B Enterprise Value1,2

79.2 M Common Shares Outstanding3

166,234 Daily Trading Volume4

$2.40 Annualized Dividend per Share (20¢/month)

3.6 % Current Dividend Yield1

61 % Payout Ratio5

1 Based on closing share price at January 20, 2014. 2 Enterprise value includes debt (as at Sept 30, 2013) less working capital

3 Basic shares outstanding at December 31, 2013. 4 Fourth quarter 2013 daily average. 5 Year-to-date as of Sept 30, 2013.


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In Summary - Our Platform for Success

• Track record of steady value creation

• Stable cash flows with demonstrated growth

• Focused strategy, disciplined approach

• Positioned to benefit from liquids-rich gas

production

• Positioned to capitalize on growth in oil sands

activities

• 2014 growth capital expected to be largest in

Keyera’s history

25

For Further Information Contact: John Cobb Vice-President, Investor Relations or Julie Puddell Manager, Investor Relations 888-699-4853 [email protected]

Keyera Corp. 600, 144 – 4 Avenue SW Calgary, Alberta T2P 3N4

WWW.KEYERA.COM

cibc whistler investor conference corporate profile...–ngl extraction capability at 95% of plants...

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