Scotia Howard Weil Energy Conference

Transcription

1 Scotia Howard Weil Energy Conference Alan Armstrong, Chief Executive Officer March 24, 2015

2 Diverse, Large-Scale Strategic Positions Delivering Value Today, Ongoing Growth Marcellus-Utica Zoom-in View 2

3 Significant, Growth-oriented Asset Position Focused on the Natural Gas Value Chain Approximately 30% U.S. Gas Volumes Touch Our Systems Market Hub Transmission Pipelines and Storage Natural Gas End User Ethylene Propylene Wellhead (onshore and offshore) Gathering Mixed Natural Gas Gas Processing Liquids Plants Fractionation Facilities Multiple Products Storage Transmission Pipelines Olefins Plant Market Hub End User 17 Bcf/d 475 Mbbl/d crude oil 7 Bcf/d inlet 418 Mbbl/d 233 Mbbl/d 22 MMbbl 416 (lbs/year) Mbbl/d 1,950 MM ethylene 807 MM propylene 395MM lbs ethylene storage 25 storage customers 9 exchange partners Figures represent 100% capacity for operated assets, including those in which Williams and/or WPZ have a share of ownership; NGL and derivatives storage includes capacity owned and under long-term lease; olefins-plant volumes are inclusive of Geismar, La., facility at full operation and expansion. All data as of December 31,

4 We Are Well-Positioned to Benefit From Supply Growth NATURAL GAS U.S. SUPPLY GROWTH (Bcf/d) CAGR 4% % +15 Bcf/d CAGR 3% % +47 Bcf/d Northeast Rockies 80 San Juan Gulf of Mexico 60 Fort Worth 40 Mid-Continent Gulf Coast Permian West Coast Alaska Source: Wood Mackenzie North America Gas Service. Note: Excludes Canadian import volumes of approximately 5 Bcf/d (at 2014 levels). 4

5 Demand Shows Up in Response to Supply, Price Nearly 120 Bcf/d on 3% CAGR by 2031 NATURAL GAS U.S. DEMAND GROWTH (Bcf/d) CAGR 2.5% CAGR 3% % Bcf/d % +45 Bcf/d Other LNG Exports Power 40 Industrial Residential & Commercial Source: Wood Mackenzie North America Gas Service Note: Other includes Net Mexican Exports, Transportation, and other miscellaneous demand 5

6 WPZ: Large-scale, value-creating projects ready to contribute; many more to come Recent Milestones Gulfstar One commissioned in November 2014; ramping up production in 1Q 2015 Transco delivered record peak day volume of 12.6 MMdt; completed two recent expansions ACMP - Over 6.5 Bcf/d gross volume record December 2014 ACMP - UEO Leesville Processing Plant train one online December 2014 Keathley Canyon Connector - first gas flow in February 2015 Geismar restart: some ethylene sales in February 2015; ramping up production Niobrara Bucking Horse Processing Plant commissioned February 2015 Early in-service for Virginia South Side (mainline portion) in December 2014 Coming Soon Early in-service expected for Leidy SE (mainline portion) in March 2015 Rockaway Lateral expected approximately March-April

7 Merged WPZ expecting 88% fee-based gross margins 2015 FORECAST: $6.0 BILLION 9% 3% 31% 27% 30% Regulated Gas Pipeline Fee Based Revenue (30%) (Demand Payments) Access Midstream Fee Based Revenue (27%) (Primarily Cost of Service and MVC) Other Fee Based Revenue (31%) Olefins Commodity Margins (9%) NGL Commodity Margins (3%) Note: Gross margin dollars and fee-based percentage calculated at midpoint of guidance range. 7

8 Merged WPZ allocating 99% of $9.3 billion in growth capital guidance to fee-based projects GROWTH CAPITAL FORECAST 1% 26% 21% 52% Regulated Gas Pipeline Fee Based Projects (52%) (Demand Payments) Access Fee Based Projects (21%) (Primarily Cost of Service and MVC) Other Fee Based Projects (26%) Commodity Margin Projects (1%) Note: Growth capital dollars and fee-based percentage calculated at midpoint of guidance range. 8

9 Nearly $30 Billion in committed plus potential capital projects TARGET IN-SERVICE DATES FOR VISIBLE GROWTH PROJECTS NE: Frac II NE: ethane line & de-ethanizer NE: Oak Grove TXP I NE: Other facilities Gulfstar One Keathley Canyon Connector Bucking Horse Geismar Expansion Bayou Ethane Texas Belle Rockaway Lateral Leidy SE Virginia Southside Mobile Bay South III CPV Woodbridge ACMP G&P Kodiak Northeast G&P CNRL Offgas Processing* Constitution Pipeline Rock Springs ACMP G&P Gunflint Northeast G&P Atlantic Sunrise Dalton Lateral Hillabee Phase 1 Gulf Trace Garden State ACMP G&P Northeast G&P Sabal Trail ownership option Transco numerous other expansions ACMP G&P Northeast G&P Parachute Plant Expansion Gulfstar FPS and pipelines U.S., PEMEX Gulf of Mexico other oil-driven services Pacific Connector and other NWP projects Canadian PDH 1&2* Syncrude Offgas Processing* Geismar 2* NGL & Petchem services other* Gulf Coast Petchem Services* *WMB projects expected to be dropped down to WPZ In progress Potential/under negotiation 9

10 WPZ s Expected Growth Drives 40% Increase in Cash Distributions to WMB (Midpoint of guidance, dollars in millions) WPZ business expected to grow 59% (17% CAGR) GP / IDRs expected to grow 69% (19% CAGR) WPZ ADJUSTED EBITDA 1 WPZ DISTRIBUTIONS TO WILLIAMS 2 (ACCRUED BASIS) 7,000 6,000 5,000 4,000 17% CAGR 3,750 4,465 5,315 5,965 3,000 2,000 12% CAGR 2,000 2,140 2,455 2,805 GP/IDRs 19% CAGR 3,000 2,000 1,000 LP 6% CAGR 1, Notes: 1 A more detailed schedule reconciling this non-gaap measure is provided in this presentation. 2 Distributions reflect per-unit increases of 9% annually in (midpoint of guidance). Williams owns an approximate 59 percent limited partner interest, a 2 percent general partner interest and the incentive distribution rights (IDRs). 10

11 Williams well positioned for strong growth through lower commodity price cycles ACMP/WPZ merger created leading natural gas MLP with strong cash distribution growth and investment-grade credit ratings Expect WPZ per unit distribution of $3.40 in 2015 with 7% to 11% annual growth rate through 2017 with growing coverage Expect WMB dividend of $2.38 per share in 2015 with 10% to 15% annual growth rate through 2017 with growing coverage Commissioned and ramping up large-scale assets About 88% of WPZ gross margin coming from fee-based revenues Nearly $30 billion of committed and potential growth capital through 2019 $9.3 billion of total in-guidance growth capex; 99% is focused on fee-based projects Strategy focused on continued natural gas and natural gas products demand growth 11

12 Appendix

13 Updated guidance reflects sharply lower commodity price assumptions Guidance Metric Low Mid High Low Mid High Low Mid High Adjusted EBITDA (millions) Williams Partners Expected $4,300 $4,465 $4,630 $5,120 $5,315 $5,510 $5,750 $5,965 $6,180 Williams NGL & Petchem Benefits Services (5) (5) (5) (5) Other Total Adjusted EBITDA (1) $4,345 $4,510 $4,675 $5,170 $5,375 $5,580 $5,825 $6,050 $6,275 Capital & Investment Expenditures (millions) Williams Partners Growth $3,250 $3,525 $3,800 $2,650 $2,925 $3,200 $2,550 $2,850 $3,150 Williams Partners Maintenance Williams NGL & Petchem Growth Williams NGL & Petchem Services Maintenance Other Total Capital & Investment Expenditures $3,960 $4,275 $4,590 $3,300 $3,605 $3,910 $3,025 $3,325 $3,625 Williams Cash Available for Dividends (1) 1,875 2,135 2,525 Cash Dividends 1,785 2,020 2,290 Dividends per Share $2.38 $2.68 $3.01 Dividend Coverage Ratio (1) 1.05x 1.06x 1.10x Williams Partners Distributable Cash Flow (1) $2,845 $3,010 $3,175 $3,475 $3,675 $3,875 $3,960 $4,185 $4,410 Cash Distributions $3,010 $3,005 $2,995 $3,380 $3,440 $3,515 $3,770 $3,925 $4,090 Cash Distributions per LP Unit $3.40 $3.40 $3.40 $3.64 $3.71 $3.78 $3.89 $4.04 $4.19 Cash Distribution Coverage Ratio (1) 0.95x 1.00x 1.06x 1.03x 1.07x 1.10x 1.05x 1.07x 1.08x Pro Forma Cash Distribution Coverage Ratio (2) 1.05x NA NA (1) Adjusted EBITDA, cash available for dividends, dividend coverage ratio, distributable cash flow and cash distribution coverage ratio are non-gaap measures. Reconciliations to the most relevant measures included in GAAP are attached to this news presentation. (2) We estimate the 2015 cash distribution coverage ratio would have been approximately 1.05x, assuming Geismar, Keathley Canyon Connector and Gulfstar were in service at expected capacity for full-year

14 Financial Outlook WMB Expect 10-15% Annual Dividend Growth with Expanding Coverage DIVIDEND ILLUSTRATION AND COVERAGE CALCULATION (Midpoint of guidance, dollars in millions except per share amounts) Distributions from Williams Partners $2,140 $2,455 $2,805 Williams NGL & Petchem Services Adjusted Cash Flow (see below) (5) - 25 Corporate Interest (255) (260) (260) Subtotal 1,880 2,195 2,570 WMB Cash Tax Rate 1-2.9% 0.0% 0.2% WMB Cash Taxes (excludes cash taxes paid by MLP) 55 - (5) Corporate Capex and Other (60) (60) (40) WMB Cash Flow Available for Dividends $1,875 $2,135 $2,525 - per share $2.50 $2.83 $3.32 WMB Expected Dividends Paid (1,785) (2,020) (2,290) Excess Cash Flow Available After Dividends $90 $115 $235 Coverage Ratio x 1.06x 1.10x Dividend Per Share $2.38 $2.68 $3.01 Annual Growth Rate 22% 12.5% 12.5% Williams NGL & Petchem Services Adjusted Cash Flow: Adjusted EBITDA (see reconciliation provided in this presentation) (5) 5 30 Maintenance Capital - (5) (5) Adjusted Cash Flow (5) - 25 Notes: 1 Near-term tax rates are lower than longer-term rates due to accelerated depreciation and deductions related to our investment in ACMP. A 2014 tax Net Operating Loss, due to bonus depreciation, will yield a carryback refund from 2012 and a carryforward reducing taxes through The average tax rate for is expected to be approximately 4%, which represents a blended rate on WPZ distributions, WMB NGL Petchem earnings, and corporate interest expense as well other tax items impacting the WMB corporate entity. 2 WMB Cash Flow Available for Dividends / WMB Expected Dividends Paid. 14

15 Updated guidance reflects sharply lower commodity price assumptions Expected Benefits Commodity Price Assumptions Low Mid High Low Mid High Low Mid High Crude WTI $/barrel $45.00 $55.00 $65.00 $53.75 $65.00 $76.25 $57.50 $70.00 $82.50 for reference only (1) NG Henry Hub $/MMBtu Expected $2.50 $3.00 $3.50 $2.75 $3.25 $3.75 $3.25 $3.75 $4.25 Benefits Composite NGL barrel (2) cents/gallon Crack Spread - cents/pound (3) Ethylene spot - cents/pound Ethane - cents/gallon Propane - cents/gallon Propylene spot - cents/pound (1) No crude oil sales, price provided for reference only (2) Component weighting of composite NGL barrel assuming ethane recovery (ethane 55%, propane 23%, iso-butane 7%, normal butane 5%, C5+ 10%) (3) Crack spread is based on delivered U.S. Gulf Coast ethylene and Mont Belvieu ethane. 15

16 Corporate Sensitivities to price changes (millions) NG Ethane Propane C4+ Ethylene Propylene 2 + $.10/Mmbtu ($5.9) WPZ + $.01/gallon ($4.2) $3.7 $2.9 + $.01/pound $14.4 $1.9 + $.10/Mmbtu ($0.2) Williams NGL & Petchem Services 1 + $.01/gallon $0.1 $0.1 $0.0 + $.01/pound $0.0 $0.1 + $.10/Mmbtu ($6.1) WMB + $.01/gallon ($4.1) $3.8 $2.9 + $.01/pound $14.4 $2.0 NG Ethane Propane C4+ Ethylene Propylene 2 + $.10/Mmbtu ($5.2) WPZ + $.01/gallon ($5.0) $3.5 $2.7 + $.01/pound $16.0 $2.0 + $.10/Mmbtu ($1.4) Williams NGL & Petchem Services 1 + $.01/gallon $0.7 $0.6 $0.1 + $.01/pound $0.0 $0.8 + $.10/Mmbtu ($6.6) WMB + $.01/gallon ($4.3) $4.1 $2.8 + $.01/pound $16.0 $2.8 Includes equity volumes associated with Opal, Echo, Piceance, Four Corners, Mobile Bay, Markham, Discovery, RGP Splitter, Geismar, Conway, and Canada. Fixed margin and commodity exposed fee contracts are also taken into account. 1) Includes equity volumes associated with Canada that are not in WPZ 2) Excludes volumes associated with RGP Splitter 16

17 Strategic, Large-Scale, Primarily Fee-Based Cash Flows Driving Growth > Target IRRs > Fee-based 13%-25% > Commodity-exposed 25%+ PROJECT DESCRIPTION AND EST. CAPEX EXPECTED REMAINING TIME TO IN-SERVICE DATE* WPZ Atlantic/Gulf Atlantic Sunrise ($2,100 Transco share) $2,100 Leidy SE $600 Keathley Canyon Connector 60% Ownership $460 Virginia South Side $300 Gulf Trace $300 Hillabee Expansion (Phase 1) $310 Constitution Pipeline 41% Ownership $360 Dalton Lateral $275 Rockaway Lateral $350 Garden State - $150 Gunflint $150 Partial Service Partial Service Phase 2 WPZ NGL/Petchem Geismar Expansion $810 CNRL Upgrader $250 WMB NGL/Petchem CNRL Upgrader $450 Pipeline Acq. & Related Petchem Svs. Proj. $450 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q *Actual in-service date often dependent on customer readiness, regulatory approvals, and other factors outside our control. Estimated project capital expenditures include amounts invested prior to

18 Reconciliations

19 WMB Non-GAAP Disclaimer This presentation includes certain financial measures adjusted EBITDA, adjusted segment profit and adjusted segment profit + DD&A, adjusted income from continuing operations ( earnings ), adjusted earnings per share, cash available for dividends, dividend coverage ratio, distributable cash flow and cash distribution coverage ratio that are non-gaap financial measures as defined under the rules of the Securities and Exchange Commission. For the following definitions, depreciation and amortization (DD&A) includes amortization of basis differences related to equity-method investments. Adjusted EBITDA is defined as net income (loss) before income tax expense, net interest expense, depreciation and amortization expense (including amortization of basis differences related to equity-method investments) and equity earnings from investments, adjusted for certain other items management believes affect the comparability of operating results. We also add our proportional ownership share of net income (loss) before income tax expense, net interest expense, depreciation and amortization expense of equity investments. Adjusted income from continuing operations and adjusted segment profit exclude items of income or loss that we characterize as unrepresentative of our ongoing operations and may include assumed business interruption insurance related to the Geismar plant. Adjusted segment profit + DD&A is adjusted to add back depreciation and amortization expense. Management believes these measures provide investors meaningful insight into results from ongoing operations. For Williams, cash available for dividends is defined as cash received from its ownership in MLPs, cash received (used) by its NGL & Petchem Services segment (other than cash for capital expenditures) less interest, taxes and maintenance capital expenditures associated with Williams and not the underlying MLPs. We also calculate the ratio of cash available for dividends to the total cash dividends paid (dividend coverage ratio). This measure reflects Williams cash available for dividends relative to its actual cash dividends paid. For the newly merged-mlp, Williams Partners L.P., we define distributable cash flow as adjusted EBITDA less maintenance capital expenditures, cash paid for interest expense, distributions to noncontrolling interests and cash income taxes. For the newly merged-mlp, Williams Partners L.P., we also calculate the ratio of distributable cash flow to the total cash distributed (cash distribution coverage ratio). This measure reflects the amount of distributable cash flow relative to our cash distribution. We have also provided this ratio calculated using the most directly comparable GAAP measure, net income. This presentation is accompanied by a reconciliation of these non-gaap financial measures to their nearest GAAP financial measures. Management uses these financial measures because they are accepted financial indicators used by investors to compare company performance. In addition, management believes that these measures provide investors an enhanced perspective of the operating performance of the Partnership's assets and the cash that the business is generating. Neither adjusted EBITDA, adjusted segment profit, adjusted segment profit + DD&A, adjusted income from continuing operations, cash available for dividends, nor distributable cash flow are intended to represent cash flows for the period, nor are they presented as an alternative to net income or cash flow from operations. They should not be considered in isolation or as substitutes for a measure of performance prepared in accordance with United States generally accepted accounting principles. 19

20 WMB Net Income to Adjusted EBITDA Reconciliation WPZ WMB NGL PETCHEM CORPORATE / OTHER TOTAL WMB Low Base High Low Base High Low Base High Low Base High Net income from continuing operations $1,555 $1,720 $1,885 $0 $0 $0 ($630) ($670) ($710) $925 $1,050 $1,175 Add: Net interest expense (15) (15) (15) ,095 1,095 1,095 Add: Provision for income taxes Add: Depreciation & amortization (DD&A) 1,705 1,705 1, ,750 1,750 1,750 Less: Equity earnings from investments (380) (385) (390) (380) (385) (390) Add: Proportionate share of EBITDA from investments Adjustments 2 (115) (115) (115) (90) (90) (90) Adjusted EBITDA $4,300 $4,465 $4,630 ($5) ($5) ($5) $50 $50 $50 $4,345 $4,510 $4, WPZ WMB NGL PETCHEM CORPORATE / OTHER TOTAL WMB Low Base High Low Base High Low Base High Low Base High Net income from continuing operations $2,025 $2,225 $2,425 ($20) ($12.5) ($5) ($730) ($778) ($825) $1,275 $1,435 $1,595 Add: Net interest expense ,225 1,220 1,215 Add: Provision for income taxes (10) (7.5) (5) Add: Depreciation & amortization (DD&A) 1,800 1,800 1, ,870 1,870 1,870 Less: Equity earnings from investments (495) (505) (515) (495) (505) (515) Add: Proportionate share of EBITDA from investments Adjustments Adjusted EBITDA $5,120 $5,315 $5,510 ($5) $5 $15 $55 $55 $55 $5,170 $5,375 $5, WPZ WMB NGL PETCHEM CORPORATE / OTHER TOTAL WMB Low Base High Low Base High Low Base High Low Base High Net income from continuing operations $2,465 $2,690 $2,915 ($5) $5 $15 ($810) ($870) ($930) $1,650 $1,825 $2,000 Add: Net interest expense 1,075 1,065 1, ,335 1,325 1,315 Add: Provision for income taxes Add: Depreciation & amortization (DD&A) 1,875 1,875 1, ,945 1,945 1,945 Less: Equity earnings from investments (645) (660) (675) (645) (660) (675) Add: Proportionate share of EBITDA from investments Adjustments Adjusted EBITDA $5,750 $5,965 $6,180 $20 $30 $40 $55 $55 $55 $5,825 $6,050 $6,275 Notes: 1 A more detailed schedule reconciling this non-gaap measure is provided in this presentation. 2 A detailed schedule of 2015 adjustments is provided in this presentation. 20

21 Reconciliation of Proportionate Share of Adjusted EBITDA from Equity Investments (Dollars in millions) Low Base High Low Base High Low Base High Net income from continuing operations $380 $385 $390 $495 $505 $515 $645 $660 $675 Add: Net interest expense Add: Depreciation & amortization (DD&A) Other Adjusted EBITDA from Equity Investments $665 $670 $675 $800 $810 $820 $955 $970 $985 21

22 WMB 2015 Schedule of Expected EBITDA Adjustments (Dollars in millions) Williams Partners (WPZ) Geismar incident adjustment for insurance and timing (150) ACMP retention expenses 35 Total Williams Partners adjustments (115) Williams Corporate / Other Adjustments: ACMP acquisition related expenses 25 Total WMB Adjustments (90) 22

23 WPZ Non-GAAP Disclaimer This presentation includes certain financial measures adjusted EBITDA, adjusted segment profit and adjusted segment profit + DD&A, distributable cash flow, and cash distribution coverage ratio that are non-gaap financial measures as defined under the rules of the Securities and Exchange Commission. For the following definitions, depreciation and amortization (DD&A) includes amortization of basis differences related to equity-method investments. Adjusted EBITDA is defined as net income (loss) before income tax expense, net interest expense, depreciation and amortization expense (including amortization of basis differences related to equity-method investments) and equity earnings from investments, adjusted for certain other items management believes affect the comparability of operating results. We also add our proportional ownership share of net income (loss) before income tax expense, net interest expense, depreciation and amortization expense of equity investments. Adjusted segment profit excludes items of income or loss that we characterize as unrepresentative of our ongoing operations and may include assumed business interruption insurance related to the Geismar plant. Adjusted segment profit + DD&A is adjusted to add back depreciation and amortization expense. Management believes these measures provide investors meaningful insight into results from ongoing operations. For the newly merged-mlp, Williams Partners L.P., we define distributable cash flow as adjusted EBITDA less maintenance capital expenditures, cash paid for interest expense, distributions to noncontrolling interests and cash income taxes. For the newly merged-mlp, Williams Partners L.P., we also calculate the ratio of distributable cash flow to the total cash distributed (cash distribution coverage ratio). This measure reflects the amount of distributable cash flow relative to our cash distribution. We have also provided this ratio calculated using the most directly comparable GAAP measure, net income. This presentation is accompanied by a reconciliation of these non-gaap financial measures to their nearest GAAP financial measures. Management uses these financial measures because they are accepted financial indicators used by investors to compare company performance. In addition, management believes that these measures provide investors an enhanced perspective of the operating performance of the Partnership's assets and the cash that the business is generating. Neither adjusted EBITDA, adjusted segment profit, adjusted segment profit + DD&A, nor distributable cash flow are intended to represent cash flows for the period, nor are they presented as an alternative to net income or cash flow from operations. They should not be considered in isolation or as substitutes for a measure of performance prepared in accordance with United States generally accepted accounting principles 23

24 WPZ Distributable Cash Flow (DCF) WPZ Non-GAAP Reconciliations Dollars in millions, except per L.P. unit Low Base High Low Base High Low Base High Adjusted EBITDA 1 $4,300 $4,465 $4,630 $5,120 $5,315 $5,510 $5,750 $5,965 $6,180 Less: Maintenance Capex 2 (430) (430) (430) (440) (440) (440) (440) (440) (440) Less: Interest Expense (cash portion) 3 (885) (885) (885) (1,000) (995) (990) (1,110) (1,100) (1,090) Less: Cash Taxes (5) (5) (5) (10) (10) (10) (10) (10) (10) Less: Noncontrolling Interests (135) (135) (135) (195) (195) (195) (230) (230) (230) Distributable Cash Flow Attributable to Partnership Operations $2,845 $3,010 $3,175 $3,475 $3,675 $3,875 $3,960 $4,185 $4,410 Cash Distributions (accrued) $3,010 $3,005 $2,995 $3,380 $3,440 $3,515 $3,770 $3,925 $4, per L.P. Unit $3.40 $3.40 $3.40 $3.64 $3.71 $3.78 $3.89 $4.04 $ Annual growth rate 7% 9% 11% 7% 9% 11% Cash Distribution Coverage Ratio 0.95x 1.00x 1.06x 1.03x 1.07x 1.10x 1.05x 1.07x 1.08x Note: 1 A more detailed schedule reconciling this non-gaap measure is provided in this presentation. 2 Includes proportionate share of maintenance capex of equity investments 3 Includes proportionate share of interest expense of equity investments 24

25 WPZ Net Income to Adjusted EBITDA Reconciliation WPZ Non-GAAP Reconciliations ('$ in millions) Low Base High Low Base High Low Base High Net income from continuing operations $1,555 $1,720 $1,885 $2,025 $2,225 $2,425 $2,465 $2,690 $2,915 Add: Net interest expense ,075 1,065 1,055 Add: Provision for income taxes Add: Depreciation & amortization (DD&A) 1,705 1,705 1,705 1,800 1,800 1,800 1,875 1,875 1,875 Less: Equity earnings from investments (380) (385) (390) (495) (505) (515) (645) (660) (675) Add: Proportionate share of EBITDA from investments Adjustments 2 (115) (115) (115) Adjusted EBITDA $4,300 $4,465 $4,630 $5,120 $5,315 $5,510 $5,750 $5,965 $6, ) Proportionate Share of EBITDA from investments: Low Base High Low Base High Low Base High Net income from continuing operations $380 $385 $390 $495 $505 $515 $645 $660 $675 Add: Net interest expense Add: Depreciation & amortization (DD&A) Other Adjusted EBITDA from Equity Investments $665 $670 $675 $800 $810 $820 $955 $970 $ ) Adjustments: Low Base High Low Base High Low Base High Geismar incident adjustment for insurance and timing ($150) ($150) ($150) ACMP acquisition-related expenses Total Adjustments ($115) ($115) ($115)

26 Forward Looking Statements

27 Forward Looking Statements This presentation of The Williams Companies, Inc. (Williams) and Williams Partners L.P. (WPZ) contains or incorporates by reference statements that do not directly or exclusively relate to historical facts. Such statements are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of You typically can identify forward-looking statements by various forms of words such as anticipates, believes, seeks, could, may, should, continues, estimates, expects, forecasts, intends, might, goals, objectives, targets, planned, potential, projects, scheduled, will, assumes, guidance, outlook, in service date or other similar expressions. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to management and include, among others, statements regarding: Expected levels of cash distributions by WPZ with respect to general partner interests, incentive distribution rights, and limited partner interests; The levels of dividends to Williams stockholders; Future credit ratings of Williams and WPZ; Amounts and nature of future capital expenditures; Expansion and growth of our business and operations; Financial condition and liquidity; Business strategy; Cash flow from operations or results of operations; Seasonality of certain business components; Natural gas, natural gas liquids, and olefins prices, supply, and demand; and Demand for our services. Forward-looking statements are based on numerous assumptions, uncertainties and risks that could cause future events or results to be materially different from those stated or implied in this presentation. Many of the factors that will determine these results are beyond our ability to control or predict. Specific factors that could cause actual results to differ from results contemplated by the forward-looking statements include, among others, the following: Whether WPZ will produce sufficient cash flows to provide the level of cash distributions we expect; Whether Williams is able to pay current and expected levels of dividends; Availability of supplies, market demand, and volatility of prices; 27

28 Forward Looking Statements (cont d) Inflation, interest rates, and fluctuation in foreign exchange rates and general economic conditions (including future disruptions and volatility in the global credit markets and the impact of these events on customers and suppliers); The strength and financial resources of our competitors and the effects of competition; Whether we are able to successfully identify, evaluate and execute investment opportunities; Our ability to acquire new businesses and assets and successfully integrate those operations and assets into our existing businesses as well as successfully expand our facilities; Development of alternative energy sources; The impact of operational and developmental hazards and unforeseen interruptions; The ability to recover expected insurance proceeds related to the Geismar plant; Costs of, changes in, or the results of laws, government regulations (including safety and environmental regulations), environmental liabilities, litigation, and rate proceedings; Williams costs and funding obligations for defined benefit pension plans and other postretirement benefit plans; WPZ s allocated costs for defined benefit pension plans and other postretirement benefit plans sponsored by its affiliates; Changes in maintenance and construction costs; Changes in the current geopolitical situation; Our exposure to the credit risk of our customers and counterparties; Risks related to financing, including restrictions stemming from debt agreements, future changes in credit ratings as determined by nationally-recognized credit rating agencies and the availability and cost of capital; The amount of cash distributions from and capital requirements of our investments and joint ventures in which we participate; Risks associated with weather and natural phenomena, including climate conditions; Acts of terrorism, including cybersecurity threats and related disruptions; and Additional risks described in our filings with the Securities and Exchange Commission (SEC). Given the uncertainties and risk factors that could cause our actual results to differ materially from those contained in any forward-looking statement, we caution investors not to unduly rely on our forward-looking statements. We disclaim any obligations to and do not intend to update the above list or announce publicly the result of any revisions to any of the forward-looking statements to reflect future events or developments. In addition to causing our actual results to differ, the factors listed above may cause our intentions to change from those statements of intention set forth in this presentation. Such changes in our intentions may also cause our results to differ. We may change our intentions, at any time and without notice, based upon changes in such factors, our assumptions, or otherwise. Investors are urged to closely consider the disclosures and risk factors in Williams and WPZ s annual reports on Form 10-K filed with the SEC on Feb. 26, 2014, and each of our quarterly reports on Form 10-Q available from our offices or from our websites at and 28