investor presentation june 2018 - ngl energy partners...

Investor Presentation

June 2018

This presentation includes “forward looking statements” within the meaning of

federal securities laws. All statements, other than statements of historical fact,

included in this presentation are forward looking statements, including

statements regarding the Partnership’s future results of operations or ability to

generate income or cash flow, make acquisitions, or make distributions to

unitholders. Words such as “anticipate,” “project,” “expect,” “plan,” “goal,”

“forecast,” “intend,” “could,” “believe,” “may” and similar expressions and

statements are intended to identify forward-looking statements. Although

management believes that the expectations on which such forward-looking

statements are based are reasonable, neither the Partnership nor its general

partner can give assurances that such expectations will prove to be correct.

Forward looking statements rely on assumptions concerning future events and

are subject to a number of uncertainties, factors and risks, many of which are

outside of management’s ability to control or predict. If one or more of these

risks or uncertainties materialize, or if underlying assumptions prove incorrect,

the Partnership’s actual results may vary materially from those anticipated,

estimated, projected or expected.

Additional information concerning these and other factors that could impact the

Partnership can be found in Part I, Item 1A, “Risk Factors” of the Partnership’s

Annual Report on Form 10-K for the year ended March 31, 2018 and in the other

reports it files from time to time with the Securities and Exchange Commission.

Readers are cautioned not to place undue reliance on any forward-looking

statements contained in this presentation, which reflect management’s opinions

only as of the date hereof. Except as required by law, the Partnership

undertakes no obligation to revise or publicly update any forward-looking

statement.

2

Company Information

Contact Information

Forward Looking Statements NGL Energy Partners LP

Corporate Headquarters

NGL Energy Partners LP

6120 South Yale Avenue, Suite 805

Tulsa, Oklahoma 74136

Website

www.nglenergypartners.com

Investor Relations

Contact us at (918) 481-1119

or e-mail us at

[email protected]

(1) Market Data and Unit Count as of 6/5/2018. (NGL-B ticker for Class B Preferred Units)

(2) Balance Sheet Data as of 3/31/2018, Market Capitalization and Enterprise Value include Preferred Equity

NYSE Ticker NGL

Unit Price (1) 11.45 $

Market Capitalization (1)(2) 1.83 $ Billion

Enterprise Value (1)(2) 4.72 $ Billion

Yield (1) 13.62%

http://www.nglenergypartners.com/

mailto:[email protected]

3

NGL Energy Partners LP

Overview

Segment Contribution

Crude

Logistics

Business Overview

4

Refined Products/

Renewables

Purchases and transports crude oil for resale to a pipeline injection point, storage terminal, barge loading facility, rail facility, refinery or trade hub

Provides transportation, terminaling, and storage of crude oil and condensate to third parties for a fixed-fee per barrel

Long term, take-or-pay contracts on Grand Mesa Pipeline

Provides services for the treatment, processing, and disposal of wastewater and solids generated from oil and natural gas production

Revenue streams from the disposal of wastewater and solids, transportation of water through pipelines, truck and frac-tank washouts, and recovered hydrocarbons

Transports, stores, and markets NGLs to and from refiners, gas processors, propane wholesalers, propane retailers, proprietary terminals, petrochemical plants, diluent markets and other merchant users of NGLs

Large provider of butane to refiners for gasoline blending

Utilizes underground storage to take advantage of seasonal demand

Purchase refined petroleum products primarily in the Gulf Coast, Southeast, and Midwest regions of the United States and schedule them for delivery primarily on the Colonial, Plantation, Magellan and NuStar pipelines

Sell our products to commercial and industrial end users, independent retailers, distributors, marketers, government entities, and other wholesalers

Purchase unfinished gasoline blending components for subsequent blending into finished gasoline to supply our marketing business as well as third parties

Water

Solutions

Liquids

Retail

Propane

Sells propane and distillates to end-users consisting of residential, agricultural, commercial and industrial customers

Seasonal business with majority of retail propane volume sold during the peak heating season from October through March

Focus on residential customers, high tank ownership and customer retention

Note: On May 30th 2018, NGL Energy Partners LP announced an agreement to sell all of its remaining Retail Propane Business. See press release on NGL Energy

Partners website

5

Segment Contribution Retail Propane Divestiture Highlights

On May 30th 2018, NGL Energy Partners LP announced an agreement to sell all of its remaining Retail Propane Business to a subsidiary of Superior Plus

Corp. (TSX: SPB) for $900 million, representing more than 10x Fiscal 2018 Adjusted EBITDA. Expected to close within 60 days of announcement

Note: See press releases on NGL Energy Partners website

Value received by NGL from propane divestitures totals ~ $1.1 billion (>10x FY18 EBITDA)

Retail Propane Customer Service Center

Divestiture reduces segment related maintenance capital expenditures by ~$10 million per year

Use of net proceeds from the sale expected to be neutral to slightly dilutive to near-term cash flow per unit, with accretion being driven over time as a result of certain growth opportunities that are included in the FY2019 guidance

Strengthens balance sheet and allows for reduced dependence on debt and equity markets as a source of funding in the near-term

NGL continues to target distribution coverage in excess of 1.3x and expects to achieve that coverage for FY 2019

~$800 million of proceeds used to immediately repay certain indebtedness

Expected to achieve and maintain target compliance leverage of ~ 3.25x

Positions NGL to focus on, and reinvest in, two of its largest growth platforms - Crude Logistics and Water Solutions

~$100 million of proceeds to be deployed for strategic growth acquisitions in the Water Solutions segment, with certain water disposal acquisitions already identified

Narrows operational scope to four business segments

Reduces seasonality and weather-dependency of NGL’s earnings

Proceeds to be used to meaningfully reduce debt and enhance liquidity

Transitions to a “self-funding” model highlighted by low leverage and high

distribution coverage

Business Diversity (Post Retail Propane Sale)

6

Crude Oil

Production and

Transportation/

Storage Demand

Higher Prices

29-32%

Butane Blending,

Weather and NGL

Production

Lower Prices

12-13%

Motor Fuels

Supply/Demand

and Basis

Differentials

Lower Prices

12-15%

Water Volumes,

Rig Count and

Crude Oil Price

Higher Prices

42-44%

Primary Drivers:

Benefits From:

FY19 Forecasted

EBITDA

Contribution %:

NGL LOGO

With the sale of its Retail Propane assets, NGL is making a strategic shift in its business which positions the Partnership to

focus on, and reinvest in, Crude Logistics and Water Solutions, its two best performing and largest growth platforms

Crude

Logistics Water

Solutions

Liquids

Refined Products/

Renewables


Diversified Across Multiple Businesses and Producing Basins (Post Retail Propane Sale)

Common Carrier Propane

Pipelines Basins

Grand Mesa Pipeline

Eagle Ford

Marcellus Shale

DJ Basin

Pinedale Anticline

Jonah Field

Niobrara Shale

Green River Basin

Bakken Shale

Wattenberg Field

Mississippi Lime

Granite Wash

Permian Basin

Water Services

NGL Assets

Crude Barges and

Tug Boats

Crude Oil Logistics

Colonial Products Pipeline TransMontaigne Terminal

NGL Rack Marketing Terminal

NGL Owned/Leased Assets

NGL Utilized Assets

Assets and Marketing

Presence Santa Fe Products Pipeline

Magellan Products Pipeline

NuStar Products Pipeline

NGL Crude Terminal

NuStar Energy Terminal

NGL Renewable Marketing

Terminal

7

NGL Gas Blending Terminal

NGL Operational Assumptions

8

Business Strategy

Build a Diversified

Vertically Integrated

Energy Business

Achieve Organic Growth

by Investing in New

Assets

Accretive Growth

through Strategic

Acquisitions

Focus on Businesses

that Generate Long-

Term Fee Based Cash

Flows

Transport crude oil from the wellhead to refiners

Wastewater from the wellhead to treatment for disposal, recycle or discharge

Natural Gas Liquids from fractionators / hubs to refineries and end users

Refined Products from refiners to customers

Projects that increase volumes, enhance our operations and generate attractive rates of return

Accretive organic growth opportunities that originate from assets we own and operate

Invest in existing businesses such as crude oil logistics and water solutions which provide high quality, fee based revenues

Build upon our vertically integrated business

Scale our existing operating platforms

Enhance our geographic diversity

Continue our successful track record of acquiring companies and assets at attractive prices

Focus on long-term, fee based contracts and back-to-back transactions that minimize commodity price exposure

Increase cash flows that are supported by certain fee-based, multi-year contracts that include acreage dedications or volume commitments

Disciplined Capital

Structure

Target leverage levels that are consistent with investment grade companies

Maintain sufficient liquidity to manage existing and future capital requirements and take advantage of market opportunities

Prudent distribution coverage to manage commodity cycles and fund growth opportunities

9

Operating Segments

10

Crude Logistics Platform

Grand Mesa Pipeline Crude Assets Crude Transportation Crude Marketing

~550 miles of 20” Crude oil

pipeline from the DJ Basin to

Cushing, OK

150,000 BPD capacity

16 total truck unloading bays

970,000 BBL origin tankage

Our Crude Oil Logistics segment purchases crude oil from producers and transports it to refineries or for resale at pipeline

injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs, and provides

storage, terminaling, trucking, marine and pipeline transportation services through its owned assets

4 NGL Crude Logistics Tows NGL Cushing Crude Oil Storage Tanks

Own 8 storage terminal facilities

3.6 MMbbls of storage in Cushing

1.5 MMbbls of storage in addition

to Cushing

Own 10 tows, 19 barges with

>25Mbbls per barge capacity

797 GP railcars leased or owned

163 owned trucks and 260 owned

trailers

27 LACT units

Operations are centered near

areas of high crude oil production,

such as the Bakken, DJ, Permian,

Eagle Ford, Anadarko, STACK,

SCOOP, Granite Wash,

Mississippi Lime, and southern

Louisiana at the Gulf of Mexico

11

Segment Contribution Grand Mesa Pipeline

Source: Active O&G wells denoted with blue dots, current rig locations denoted by a black rig icon and the heat map represents permit activity in the last 180 days based on data from

DrillingInfo as of 2/12/18

Grand Mesa Pipeline NGL Crude Terminal

DJ Basin

Niobrara Shale

Wattenberg Field

Cushing Storage

= Lucerne & Riverside

= Platteville

Grand Mesa

Share of

Capacity

~550 miles of 20” Crude oil pipeline from the DJ Basin to

Cushing, OK

NGL/Grand Mesa have 37.5% undivided joint interest

150,000 BPD capacity

Origin Station

Terminals

Lucerne & Riverside Terminals in Weld County, CO

16 total truck unloading bays capable of unloading over 325

trucks per day in aggregate

970,000 BBL origin tankage

Batching

Capabilities

Grand Mesa offers two unique batching specs allowing

producers to preserve their crude oil quality

Gathering

Connectivity

The Lucerne origin has inbound receipt connections to

multiple gathering systems including:

Platte River Midstream

Saddle Butte Pipeline

Noble Midstream

Destination

Terminal

NGL’s Cushing Terminal has 3.6 million barrels of total shell

capacity

Offers producers connectivity to multiple markets

including the Gulf Coast via TransCanada Marketlink

Financial

Guidance

Total volumes for FY19 average ~115kbpd

Average remaining contract term on the pipeline is

approximately 8 years

$28

$73

$48 $48

$106

$145-155

$13 $11

$12

$-

$40

$80

$120

$160

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Glass Mountain Crude Oil Logistics

$-

$20

$40

$60

$80

$100

3/31/2015 3/31/2016 3/31/2017 3/31/2018

12

Segment Contribution Crude Oil Logistics

Crude WTI Spot Price Area of Operation

Adjusted EBITDA (In Millions) FY 2019 Forecast Assumptions

Grand Mesa Pipeline

– Total volumes average ~115kbpd

Crude Assets

– Cushing market rates reduced with no assumed Contango

– Glass Mountain Sale in FY 2018

Crude Oil Marketing/Transportation

– Three new tow boats are put into service (1 every three

months starting in June)

– Assumed Crude Price forward curve April 1, 2018 – March

31, 2019 ($64.56-$59.63)

$61 $59

$118

13

Water Solutions Platform

Water Disposal Water Recycling Solids Solutions Water Pipelines

100 completed SWD wells with

~2.5 million BPD of total capacity

spanning

Bakken (ND)

Pinedale Anticline (WY)

DJ (CO)

Eagle Ford (TX)

Midland (TX)

Delaware (TX)

24x7 operations at most locations

1 water recycling facility with

~60,000 BPD of total capacity in

Wyoming

Over 30 million barrels of water

recycled and discharged since

June 2012

Multi-patented 14-step water

treatment process

8 solids disposal facilities with

~60,000 BPD of total capacity in

Texas

Provides producers with in-field

disposal alternative for Gels, High

Solids Content Water, Water and

Oil-Based Mud, and Tank Bottoms

generated from oil and natural gas

production and drilling activities

~100 miles of water pipelines

owned by NGL

~100 miles of water pipelines

owned by producers

Currently disposing of > 320,000

BPD of wastewater via pipelines

(both NGL and producer owned)

Our Water Solutions segment provides services for the treatment and disposal of wastewater generated from crude oil

and natural gas production and for the disposal of solids such as tank bottoms, drilling fluids and drilling muds and

performs truck and frac tank washouts. In addition, our Water Solutions segment sells the recovered hydrocarbons that

result from performing these services

NGL saltwater disposal facility with solids processing capacity

0

100

200

300

400

500

3/31/2015 3/31/2016 3/31/2017 3/31/2018

Permian Basin Eagle Ford Basin DJ Basin

14

Segment Contribution Water Solutions

U.S Oil Rig Count(1) Area of Operation


(1) Baker Hughes as of March 2018.

$68

$126

$72 $63

$116

$200-225

$-

$100

$200

$300

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Primary growth focused in Permian (Delaware) and DJ basins

Average skim oil percentage forecasted at 0.43% for each disposal volume

– Assumed Crude Price forward curve April 1, 2018 – March 31, 2019 ($64.56-$59.63) further adjusted for Differentials and Hedges

Pipelines, Solids disposal, Washouts, and other service revenues increase with volumes

Growth capital and planned acquisitions adds several new facilities and disposal wells to existing footprint

– ~$140 - $150 million in acquisitions

– ~$100 million in organic growth

Propane/Butane Wholesale

Office locations in Denver,

Chicago, Calgary, Houston, Tulsa

Fleet of ~4,200 railcars and will

reduce fleet to ~3,700 by fiscal

year end

23 transloading units

15

NGL Liquids Platform

NGL Terminals Sawtooth

400 Customers

Shipper on 5 common carrier

pipelines

Approximately 2.8 million barrels of

leased underground storage, 0.35

million barrels of above ground

storage

21 Terminals with throughput

capacity of 11.9 million gallons per

day

12 terminals with rail

unloading capability

4 Multi-products terminals

9 Pipe-connected terminals

5 Caverns

~6.0 million barrels of butane and

propane storage capacity in Utah

Newly created JV structure to store

refined products

Our Liquids segment provides natural gas liquids procurement, storage, transportation, and supply services to

customers through assets owned by us and third parties. We also sell butanes and natural gasolines to refiners and

producers for use as blending stocks and diluent and assist refineries by managing their seasonal butane supply needs

Railcar Rack NGL Thackerville Liquids Terminal West Memphis NGL Wholesale Liquids Terminal

16

Segment Contribution Liquids

Heating Degree Days Area of Operation


$87 $93 $101

$64 $50

$55-70

$-

$50

$100

$150

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Propane/Butane Wholesale

– Assumes a normal winter (5-year average of HDD)

– Assumes butane blending economics are better for refiners than FY 2018

NGL Terminals

– Results are determined by propane demand

Sawtooth

– Newly created JV structure with additional commercial development drive

– Additional rights to store refined products

17

Refined Products & Renewables Platform

Southeast Rack Marketing and Other Gas Blending

Line Space on Colonial and

Plantation pipelines

Long-term Lease of TLP SE

Terminals along Colonial and

Plantation Pipelines


storage capacity

Utilizing 3 major Pipelines

Magellan

NuStar

Explorer

Ethanol and Biodiesel Blending


storage capacity

Rack marketing services from over

180 terminals in 34 states

providing diesel and gasoline

products

Margins driven by normal

supply/demand activity as well as

disruption events such as weather

or refinery/pipeline issues

TLP-Collins Storage facility in

Collins, MS

1.15 million barrels capacity

Colonial Pipeline in/out

Nustar Storage Facility in Linden,

NJ

715K barrels capacity

Our Refined Products and Renewables segment conducts gasoline, diesel, ethanol, and biodiesel marketing operations. In

addition, in certain storage locations, our Refined Products and Renewables segment may also purchase unfinished

gasoline blending components for subsequent blending into finished gasoline to supply our marketing business as well

as third parties

Collins, MS Refined Products Terminal

18


DOE Total U.S. Gas Supplied(1) Area of Operation


Refined Products/Renewables

(1) Department of Energy EIA weekly data for 4/4/18.

7,500

8,000

8,500

9,000

9,500

10,000

2011 to 2015 Range

2011 to 2015 Average 2016

2017 2018

Southeast (Colonial and Plantation pipelines)

– Average gross margin of $0.03 per gallon

– Renewables blending contributes ~$4.0 million of gross margin

Gas Blending

– Nymex delivery point allows for increased price protection for Southeast volumes

Rack Marketing and Other

– Diesel demand growth in the Permian basin

– Increased storage capacity to utilize for blending

– No significant legislative impact (Renewables)

$8

$79

$134 $125

$49 $55-80

$-

$50

$100

$150

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

19

Retail Propane Platform

Retail West (Sold on March 30, 2018)

Own or lease 91 customer service locations

Own or lease 72 satellite distribution locations

Aggregate propane storage capacity of 13.0 million gallons

Aggregate distillate storage capacity of 5.7 million gallons

Own 300 bulk storage tanks with capacities ranging from 18,000 to 90,000 gallons

68% residential customers; 32% commercial and industrial customers

Our Retail Propane segment consists of the retail marketing, sale and distribution of propane and distillates, including the

sale and lease of propane tanks, equipment and supplies, to more than 320,000 residential, agricultural, commercial and

industrial customers. Announced sale of the business on May 30, 2018 with expectation to close within 60 days.

Retail East (Announced sale on May 30, 2018)

Propane storage tanks at retail location Propane delivery truck

Own or lease 37 customer service locations

Own or lease 47 satellite distribution locations

Aggregate propane storage capacity of 4.5 million gallons

Own 200 bulk storage tanks with capacities ranging from 2,000 to 90,000 gallons

72% residential customers; 27% commercial and industrial customers

$65 $70 $57

$70 $83

N/A

$26 $27

$23

$20

$27

$-

$30

$60

$90

$120

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E

Retail West Retail East

20


Sample of Trade Names Area of Operation

Adjusted EBITDA (In Millions)

Retail Propane

FY 2019 Forecast Assumptions

On March 30, 2018, we sold a portion of our Retail Propane

segment (Retail West) to DCC LPG for $200.0 million in cash,

adjusted for working capital at closing, and recorded a gain on

disposal of $89.3 million during the year ended March 31, 2018. We

retained all profits from this business through March 31, 2018

On May 30, 2018 we announced that we signed a definitive

agreement to sell our remaining Retail Propane business (Retail

East) to Superior Plus Corp. (“Superior”) (TSX:SPB) for $900 million

in cash proceeds. The transaction is subject to certain regulatory

and other customary closing conditions and is expected to close

within 60 days

https://www.downeastenergy.com/





21

Financial Overview

22

Financial Objectives

The Partnership has made significant strides with over ~$1.5 billion in

announced asset sales and debt reduction in LTM and will continue to

pursue a flexible balance sheet with a leverage target of less than 3.25x on

a compliance basis

Goal of achieving investment grade rating

Increasing fee-based business and long-term contracts with high

credit quality customers

Transitioning to a more traditional midstream repeatable cash flow

model

Continue to pursue opportunities to find and execute on low cost of

capital financing in the current and future environments

Consistently pursuing strategies that increase NGL’s unit price and

lower cost of debt

Crude and Water segments provide accretive growth platforms

Accretive growth through organic growth projects and strategic

acquisitions focused on assets backed by multi-year fee based

contracted cash flows

Sufficient liquidity to operate the business and execute growth objectives

Targeting over 1.3x distribution coverage

Excess distribution coverage will be used to strengthen the balance

sheet and fund growth opportunities

Strong Balance

Sheet

Cash Flow

Predictability

Lower Cost of

Capital

Accretive Capital

Projects

Robust Distribution

Coverage


4Q '18 4Q '17 % Variance

Total Volume (In Thousand's)

Refined Products/Renewables

Gasoline (BBL's) 30,550 25,726 19%

Diesel (BBL's) 12,228 11,402 7%

Ethanol (BBL's) 546 1,415 -61%

Biodiesel (BBL's) 407 465 -12%

Crude Oil (BBL's) 11,038 9,374 18%

Liquids

Propane (GAL's) 479,454 453,586 6%

Butane (GAL's) 136,310 108,728 25%

Other NGL's (GAL's) 103,649 86,914 19%

Retail Propane

Propane (GAL's) 86,657 71,666 21%

Distillates (GAL's) 13,403 12,496 7%

Water Disposal (BBL's) 68,447 48,240 42%

Total Revenue 5,114.6$ 3,848.1$ 33%

Total Cost of Sales 4,850.4$ 3,598.7$ 35%

Adjusted EBITDA 157.4$ 121.2$ 30%

Distributable Cash Flow 98.6$ 67.6$ 46%

Distribution to LP Unitholders 0.39$ 0.39$ 0%

TTM Distribution Coverage 0.80x 1.15x

Maintenance Capex 11.0$ 8.2$ 35%

Growth Capex with Investments 51.4$ 85.4$ -40%

Covenant Compliance Leverage 4.4x 4.7x

Total L-T Debt (Excluding Working Capital Facility) 1,713.1$ 2,149.0$ -20%

Working Capital Facility 969.5$ 814.5$ 19%

Total Liquidity 605.1$ 781.3$ -23%

23

4th Quarter Update

Segment Summary

– Grand Mesa outperformed expectations while the rest of Crude Logistics continued to

be impacted by competition and low margins in the majority of basins across the U.S.

– Retail Propane performed better than original FY18 expectations due to relatively

normal winter

– Water Solutions performed in-line with revised expectations and has continued to

benefit from the increased rig counts and increased well completions in the basins in

which it operates, particularly in the Delaware Basin

– Refined Products/Renewables performed in-line with revised expectations due to better

rack margins and manageable line space values

– Liquids performed below revised expectations and was impacted by excess propane

supply, low demand and a falling propane price in February resulting in high inventory

volumes and a sales price lower than our costs

Quarterly Summary Performance ($’s In Millions)

(1) Does not include acquisition expenses.

(2) Covenant Compliance Leverage excludes the working capital facility and includes Pro Forma effects or projects in construction, or recent acquisitions/divestitures

(1)

(2)

(1)

Executed balance sheet and leverage improving transactions:

– Note Repurchases:

• Repurchased approximately $71 million of outstanding Unsecured Notes just

below par

– Asset Sales:

• Closed the sale of certain Retail Propane businesses to DCC LPG for $200

Million

• Announced and finalized the formation of a JV of NGL’s Sawtooth salt dome

storage facility. Magnum Liquids, LLC acquired an approximately 28.5%

interest in Sawtooth from NGL, in exchange for consideration consisting of a

cash payment of approximately $37.6 million and the contribution of certain

refined products rights and adjacent leasehold.

$169

$320

$274

$210 $180

>$300

$168

$266 $290

$182

$225 ~$235

FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E

Distributable Cash Flow Distributions

1.0x

1.2x

0.9x

1.2x

0.8x

1.3x

FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E

$24

$184

$271

$443 $424 $381

$408 $450

IPO FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E

24

Performance Metrics

Distributable Cash Flow & Total Distributions (In Millions)

Adjusted EBITDA (In Millions) Acquisition, Growth and Maintenance Capex (In Millions)

Distribution Coverage

1.3x

Target

(1) Does not include TLP capital expenditures (2) Includes the GP and preferred unit distributions, if any, and assumes the most recent quarterly distribution

annualized

(1)

(2)

$491

$1,269

$961

$138 $164 $50

$140-150

$59 $133 $160

$600

$334

$162 $110-125 $14 $32 $35 $30 $26 $38

$20-25

FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY 2018E FY 2019E

Acquisitions Growth Capital Maintenance Capital

3/31/2018 12/31/2017 Variance

Cash and Equivalents 26,207$ 28,469$ (2,262)$

Total Debt:

Senior Secured Revolving Credit Facilities

Working Capital Facility 969,500 1,014,500 (45,000)

Acquisition Facility - 125,000 (125,000)

5.125% Senior Notes due 2019 353,424 360,781 (7,357)

6.875% Senior Notes due 2021 367,048 367,048 -

7.500% Senior Notes due 2023 615,947 656,589 (40,642)

6.125% Senior Notes due 2025 389,135 412,507 (23,372)

Other Long-Term Debt 11,415 11,684 (269)

Total Debt, Excluding Working Capital Facility 1,736,969$ 1,933,609$ (196,640)$

10.75% Class A Convertible Preferred Units 82,576$ 76,056$ 6,520$

Redeemable Noncontrolling Interest 9,927 4,011 5,916

Equity:

General Partner (50,819) (50,869) 50

Limited Partners 1,852,495 1,823,740 28,755

Class B preferred limited partners 202,731 202,731 -

Accumulated Other Comprehensive Loss (1,815) (1,478) (337)

Noncontrolling interests 83,503 7,270 76,233

Total Capitalization 3,915,567$ 3,995,070$ (79,503)$

2.9x 3.2x 3.2x

3.9x

4.7x 4.4x

3.25x or less

.00x

1.50x

3.00x

4.50x

6.00x

FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY 2018 FY 2019E

Credit Profile

Debt Maturities as of 3/31/18 (In Millions)

Covenant Compliance Leverage

3.25x

Target

Capitalization (In Thousands)

(1) Covenant Compliance Leverage excludes acquisition expenses, excludes the working capital facility and includes Pro Forma adjustments for projects in construction or recent acquisitions/divestitures. Total

Indebtedness at March 31, 2018 per the Partnership’s Credit Facility and used for covenant compliance totaled $1.7 billion.

(2) Convertible Preferred Units included in Total Partners’ Capital calculation.

(1)

25

This

is

tied

out

$1,149

$353 $367

$616

$389

$-

$200

$400

$600

$800

$1,000

$1,200

Apr-18 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 Apr-25

Credit Facility due 10/2021 5.125% Notes due 7/2019

6.875% Notes due 10/2021 7.500% Notes due 11/2023

6.125% Notes due 2/2025

NGL Operational Assumptions

26

Key Investment Highlights

Diversified and

Attractive Asset Base

Multiple business segments with significant geographic diversity reduce cash flow volatility

Presence in the highest rate of return oil & gas producing regions in North America as well as the highest growing

population areas for consumer demand

Natural hedge between certain business segments reduces commodity price volatility and risk exposure

Vertical and Horizontal

Integration

Vertical integration allows for capture of margin across the value chain from wellhead to end-user

Emphasis on asset ownership drives ability to capitalize on multiple revenue/bolt-on opportunities

Offer a menu of services to producers and customers

Stable Cash Flows

Focus on medium to long-term, repeatable fee-based cash flows

Combination of fee-based, take-or-pay, acreage dedication, margin-based and cost-plus revenue contracts

Targeting ~70% fee based revenues in normal commodity price environment

Strong Credit Profile and

Liquidity

Targeting a distribution coverage over 1.3x on a TTM basis

Excess distribution coverage will be reinvested in growth opportunities and reduce indebtedness

Targeting a capital structure with compliance leverage of under 3.25x and total leverage under 5.0x

Experienced & Incentivized

Management Team

Extensive industry and MLP experience with proven record of acquiring, integrating, operating and growing

successful businesses

Senior management holds significant limited partner interests, which strengthens alignment of incentives with

lenders and public unitholders

Supportive general partner which is privately owned, of which over 65% is held by current and former management

and directors, with no indebtedness

27

Appendix

28

NGL Organizational Chart

NGL Energy Holdings LLC

G.P. (DE LLC) 0.1% GP Interest

IDR’s

NGL Energy Operating LLC

(DE LLC)

NGL Water Solutions (NGL Water Solutions, LLC)

Members

(1) Includes the operations of our Legacy Gavilon crude oil logistics, refined products, and renewables businesses.

99.9% LP Interest

Limited Partners

NGL Energy Partners LP (NYSE: NGL)

(DE LP)

NGL Liquids (NGL Liquids, LLC)

NGL Retail Propane (NGL Propane, LLC)

NGL Refined

Products/Renewables (TransMontaigne LLC)

100%

100%

NGL Crude Logistics (NGL Crude Logistics, LLC) (1)

121,083,664 C.U. Outstanding

2018 2017 2018 2017

Net income (loss) 110,912$ 26,486$ (69,605)$ 143,874$

Less: Net income attributable to noncontrolling interests (19) (741) (240) (6,832)

Less: Net income attributable to redeemable noncontrolling interests (1,291) - (1,030) -

Net income (loss) attributable to NGL Energy Partners LP 109,602 25,745 (70,875) 137,042

Interest expense 48,356 45,221 199,747 150,504

Income tax expense (benefit) 524 (97) 1,458 1,939

Depreciation and amortization 62,011 66,837 266,525 238,583

EBITDA 220,493 137,706 396,855 528,068

Net unrealized (gains) losses on derivatives (968) (2,601) 15,883 (3,338)

Inventory valuation adjustment 4,594 (33,184) 11,033 7,368

Lower of cost or market adjustments 102 (2,122) 399 (1,283)

Gain on disposal or impairment of assets, net (94,072) (5,744) (105,313) (209,213)

Loss (gain) on early extinguishment of liabilities, net 722 6,163 23,201 (24,727)

Revaluation of investments - - - 14,365

Equity-based compensation expense 8,127 13,243 35,241 53,102

Acquisition expense 131 232 263 1,771

Revaluation of liabilities 15,007 12,761 20,607 12,761

Other 1,785 (5,291) 10,081 2,443

Adjusted EBITDA 155,921 121,163 408,250 381,317

Less: Cash interest expense 45,785 45,462 188,543 142,258

Less: Income tax expense (benefit) 524 (97) 1,458 1,939

Less: Maintenance capital expenditures 11,036 8,172 37,713 26,073

Less: Other - - 549 19

Distributable Cash Flow 98,576$ 67,626$ 179,987$ 211,028$

Three Months Ended March 31, Year Ended March 31,

(in thousands)

29

4Q’18 Adjusted EBITDA & DCF Walk

Crude Oil Logistics Water Solutions Liquids Retail Propane

Refined Products and

Renewables Corporate and Other Consolidated

Operating income (loss) 11,072$ (14,156)$ 11,476$ 146,672$ 25,993$ (23,562)$ 157,495$

Depreciation and amortization 18,502 24,776 6,219 9,487 323 978 60,285

Amortization recorded to cost of sales 84 - 71 - 1,348 - 1,503

Net unrealized losses (gains) on derivatives 293 2,168 (3,340) (89) - - (968)

Inventory valuation adjustment - - - - 4,594 - 4,594

Lower of cost or market adjustments - - 504 - (402) - 102

(Gain) loss on disposal or impairment of assets, net (103) 3,749 1 (90,213) (7,513) 8 (94,071)

Equity-based compensation expense - - - - - 8,127 8,127

Acquisition expense - - - - - 131 131

Other income, net 436 1 5 275 118 1,455 2,290

Adjusted EBITDA attributable to unconsolidated entities - 154 - (69) 1,183 - 1,268

Adjusted EBITDA attributable to noncontrolling interest - (118) - (1,509) - - (1,627)

Revaluation of liabilities - 15,007 - - - - 15,007

Other 1,620 185 21 (41) - - 1,785

Adjusted EBITDA 31,904$ 31,766$ 14,957$ 64,513$ 25,644$ (12,863)$ 155,921$




Operating income (loss) 11,352$ (18,549)$ 10,160$ 38,702$ 53,181$ (20,392)$ 74,454$

Depreciation and amortization 19,648 25,045 5,848 11,195 325 868 62,929


Net unrealized (gains) losses on derivatives (2,464) 50 (23) (164) - - (2,601)

Inventory valuation adjustment - - - - (33,184) - (33,184)

Lower of cost or market adjustments - - - - (2,122) - (2,122)

(Gain) loss on disposal or impairment of assets, net (3,913) 6,398 (17) (191) (8,024) 3 (5,744)



Other income (expense), net 177 (785) 6 165 164 2,175 1,902

Adjusted EBITDA attributable to unconsolidated entities 3,938 115 - (39) 432 - 4,446

Adjusted EBITDA attributable to noncontrolling interest - (6,912) - (799) - - (7,711)


Other 720 89 19 - - - 828

Adjusted EBITDA 29,558$ 18,212$ 16,189$ 48,869$ 12,206$ (3,871)$ 121,163$

Three Months Ended March 31, 2018

(in thousands)

Three Months Ended March 31, 2017

(in thousands)

30

4Q’18 & 4Q’17 Adjusted EBITDA by Segment

31

4Q’18 YTD & 4Q’17 YTD Adjusted EBITDA by Segment




Operating income (loss) 122,904$ (24,231)$ (93,113)$ 155,550$ 56,740$ (79,593)$ 138,257$

Depreciation and amortization 80,387 98,623 24,937 43,692 1,294 3,779 252,712


Net unrealized losses (gains) on derivatives 2,766 13,694 (577) - - - 15,883


Lower of cost or market adjustments - - 504 - (105) - 399

(Gain) loss on disposal or impairment of assets, net (111,393) 6,863 117,516 (88,209) (30,098) 8 (105,313)



Other income, net 535 211 105 555 604 6,393 8,403

Adjusted EBITDA attributable to unconsolidated entities 11,507 579 - 822 4,308 - 17,216

Adjusted EBITDA attributable to noncontrolling interest - (737) - (1,894) - - (2,631)


Other 10,617 461 85 (1,082) - - 10,081

Adjusted EBITDA 117,661$ 116,070$ 49,739$ 109,434$ 49,255$ (33,909)$ 408,250$




Operating (loss) income (17,475)$ 44,587$ 43,252$ 49,255$ 222,546$ (87,082)$ 255,083$

Depreciation and amortization 54,144 101,758 19,163 42,966 1,562 3,612 223,205


Net unrealized (gains) losses on derivatives (1,513) (2,088) 216 47 - - (3,338)


Lower of cost or market adjustments - - - - (1,283) - (1,283)

Loss (gain) on disposal or impairment of assets, net 10,704 (85,560) 92 (287) (134,125) (1) (209,177)


Acquisition expense - - - - - 1,771 1,771

Other (expense) income, net (412) 739 73 504 19,263 7,595 27,762

Adjusted EBITDA attributable to unconsolidated entities 11,589 106 - (427) 3,975 - 15,243

Adjusted EBITDA attributable to noncontrolling interest - (9,210) - (1,241) - - (10,451)


Other 1,996 368 79 - - - 2,443

Adjusted EBITDA 59,417$ 63,461$ 63,656$ 90,817$ 124,969$ (21,003)$ 381,317$

Year Ended March 31, 2018

(in thousands)

Year Ended March 31, 2017

(in thousands)

investor presentation june 2018 - ngl energy partners...

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