UBS MLP One-on-One Conference

Transcription

1 UBS MLP One-on-One Conference January Park City, UT

2 Forward-looking Information Certain matters contained in this presentation include "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 All statements, other than statements of historical fact, included in this presentation including the prospects of our industry, our anticipated financial performance, our anticipated annual dividend growth rate, management's plans and objectives for future operations, planned capital expenditures, business prospects, outcome of regulatory proceedings, market conditions and other matters, may constitute forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that these expectations will prove to be correct. These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. Factors that might cause actual results to differ include, but are not limited to, our ability to generate sufficient cash flow from operations to enable us to pay our debt obligations or to fund our other liquidity needs; our ability to comply with the covenants contained in the instruments governing our indebtedness and to maintain certain financial ratios required by our credit facilities; the effect of our debt level on our future financial and operating flexibility, including our ability to obtain additional capital; the ability of our subsidiary, Rose Rock Midstream L.P. (NYSE: RRMS), to make expected quarterly distributions; the operations of NGL Energy Partners LP (NYSE: NGL), which we do not control; any sustained reduction in demand for the petroleum products we gather, transport, process and store; our ability to obtain new sources of supply of petroleum products; our failure to comply with new or existing environmental laws or regulations or cross border laws or regulations; the possibility that the construction or acquisition of new assets may not result in the corresponding anticipated revenue increases; changes in currency exchange rates; cyber attacks involving our information systems and related infrastructure; the risks and uncertainties of doing business outside of the U.S., including political and economic instability and changes in local governmental laws, regulations and policies; and the possibility that our hedging activities may result in losses or may have a negative impact on our financial results; as well as other risk factors discussed from time to time in each of our documents and reports filed with the SEC. 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, we undertake no obligation to revise or publicly release the results of any revision to any forward-looking statements. SemGroup and Rose Rock Midstream use their Investor Relations website and social media outlets as channels of distribution of material company information. Such information is routinely posted and accessible on our Investor Relations websites at ir.semgroupcorp.com and ir.rrmidstream.com. Both companies are present on Twitter and LinkedIn, follow us at the links below: SemGroup Twitter and LinkedIn Rose Rock Midstream Twitter and LinkedIn 2

3 Non-GAAP Financial Measures SemGroup Adjusted EBITDA and cash available for dividends are not U.S. generally accepted accounting principles ( GAAP ) measures and are not intended to be used in lieu of GAAP presentation of net income (loss). Adjusted EBITDA and cash available for dividends are presented in this presentation because SemGroup believes they provide additional information with respect to its performance. Adjusted EBITDA represents earnings before interest, taxes, depreciation and amortization, adjusted for selected items that SemGroup believes impact the comparability of financial results between reporting periods. Although SemGroup presents selected items that it considers in evaluating its performance, you should also be aware that the items presented do not represent all items that affect comparability between the periods presented. Variations in SemGroup s operating results are also caused by changes in volumes, prices, exchange rates, mechanical interruptions and numerous other factors. These types of variances are not separately identified in this presentation. Cash available for dividends is based on Adjusted EBITDA, as described above, adjusted to exclude the earnings of our subsidiary, Rose Rock Midstream, cash income taxes, cash interest expense and maintenance capital expenditures and include cash distributions received from Rose Rock Midstream. Because all companies do not use identical calculations, SemGroup s presentations of Adjusted EBITDA and cash available for dividends may be different from similarly titled measures of other companies, thereby diminishing their utility. Reconciliations of net income (loss) to Adjusted EBITDA and cash available for dividends for the periods presented are included in the appendix of this presentation. Rose Rock Midstream This presentation includes the non-gaap financial measures of Adjusted gross margin, Adjusted EBITDA and distributable cash flow, which may be used periodically by management when discussing our financial results with investors and analysts. The appendix of this presentation provides reconciliations of these non-gaap financial measures to their most directly comparable financial measures calculated and presented in accordance with GAAP. Adjusted gross margin, Adjusted EBITDA and distributable cash flow are presented as management believes they provide additional information and metrics relative to the performance of our business. Operating income (loss) is the GAAP measure most directly comparable to Adjusted gross margin, net income (loss) and cash provided by (used in) operating activities are the GAAP measures most directly comparable to Adjusted EBITDA, and net income (loss) is the GAAP measure most directly comparable to distributable cash flow. Our non-gaap financial measures should not be considered as alternatives to the most directly comparable GAAP financial measures. These non-gaap financial measures have important limitations as analytical tools because they exclude some, but not all, items that affect the most directly comparable GAAP financial measures. You should not consider Adjusted gross margin, Adjusted EBITDA or distributable cash flow in isolation or as substitutes for analysis of our results as reported under GAAP. Because Adjusted gross margin, Adjusted EBITDA and distributable cash flow may be defined differently by other companies in our industry, our definitions of these non-gaap financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. Management compensates for the limitation of Adjusted gross margin, Adjusted EBITDA and distributable cash flow as analytical tools by reviewing the comparable GAAP measures, understanding the differences between Adjusted gross margin, Adjusted EBITDA and distributable cash flow, on the one hand, and operating income (loss), net income (loss) and net cash provided by (used in) operating activities, on the other hand, and incorporating this knowledge into its decision-making processes. We believe that investors benefit from having access to the same financial measures that our management uses in evaluating our operating results. 3

4 SemGroup Ownership Structure Note: NGL Common Units are as of September 30,

5 Company Strengths Rose Rock Midstream Distribution Outlook Expect to maintain current distribution and coverage of 1.0x or better through 2016, which may include some level of GP support Stable Cash Flow Liquidity and Debt 85% of total gross margin from fixed fee-based cash flows (1) 58% of total gross margin secured by take-or-pay contracts (1) $585 million revolver availability (2) with no debt maturities until 2022 Rose Rock leverage of less than 4.0x Access to Capital Markets No capital market needs in 2016 Counterparty Strength More than 80% of Rose Rock s revenue derived from investment grade counterparties Growth Opportunities Strategically acquire assets from SemGroup based on risk and return expectations Next drop down expected to be Maurepas Pipeline in early 2017; SemGas is not expected to be dropped down SemGroup Corporation Dividend Coverage 3Q YTD dividend coverage of 2.0x Liquidity and Debt $500 million revolver availability (2) with no debt maturities until 2021 SemGroup leverage of approximately 1.1x Access to Capital Markets No capital market needs in 2016 Counterparty Strength More than 75% of SemGroup s consolidated revenue derived from investment grade counterparties (3) Supportive General Partner SemGroup is a supportive sponsor for Rose Rock 5 (1) LTM September 30, 2015 (2) As of September 30, 2015 (3) Excludes SemMaterials Mexico

6 Crude and Gas Assets in Key Growth Areas 6

7 Crude Business Overview DJ Basin White Cliffs Pipeline 51% ownership DJ Basin to Cushing, OK Two 527-mile, 12-inch pipelines 150,000 bpd current capacity Expanding capacity to approximately 215,000 bpd Expected completion first half 2016 Wattenberg Oil Trunkline 75-mile, 12-inch pipeline and storage in DJ Basin Transports Noble Energy production to White Cliffs Platteville Truck Unloading Facility 30-lane truck unloading facility Origin of White Cliffs Pipeline 330,000 barrels of storage capacity 4 new truck unloading bays and 100,000 barrels of additional storage Completed July new truck unloading bays and 5,000 barrels of additional storage Completed October 2015 Tampa Pipeline 12-mile, 12-inch pipeline from Platteville to Tampa, CO rail facility 7

8 White Cliffs Pipeline Contract & Rate Structure Committed Take or Pay Volumes Origination Volumes (bpd) Rate ($/bbl) Wtd. Avg. Remaining Contract Life Platteville, CO 72,000 $5.20 ~ 4.0 years Healy, KS 5,000 $2.09 ~ 5.6 years 77,000 $5.00 ~ 4.2 years Uncommitted Volumes (1) Volumes (bpd) Incentive Rate ($/bbl) 0 9,999 $ ,000 19,999 $ ,000 29,999 $ ,000 39,999 $ ,000 49,999 $ ,000 and up $3.65 (1) FERC Filing No

9 Crude Business Overview Oklahoma/Kansas Assets Cushing Storage 7.6 million barrels of storage 86% under long-term fixed fee contracts with first expiration average storage rate of $0.37 per month Connectivity to all major inbound/outbound pipelines Kansas/Oklahoma System Approximately 600-mile gathering and transportation pipeline system Connects to third-party pipelines, Kansas and Oklahoma refineries and Cushing terminal 650,000 barrels of storage capacity Glass Mountain Pipeline 50% ownership 215-mile pipeline Two laterals Granite Wash and Mississippi Lime Play join and terminate in Cushing 140,000 bpd current capacity Isabel Pipeline Expected Completion 1Q mile, 8-inch crude oil pipeline from Isabel Junction, KS to Alva, OK Connects Kansas barrels to Glass Mountain Pipeline Field Services Crude Oil Trucking Fleet Fleet of approximately 270 crude oil trucks Servicing the Bakken, DJ/Niobrara, Eagle Ford, Granite Wash, Mississippi Lime, Permian and Utica plays 9

10 Crude Key Performance Metrics Crude Cushing Storage 7.6 million Barrels Capacity Contracted (1) Operational / Marketing Uncontracted Crude Transportation Volumes (Thousand Barrels per Day) Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q Pipeline Volumes (2) Wattenberg Oil Trunkline Field Services (3) Joint Venture Transportation Volumes (Thousand Barrels per Day) Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q Crude Marketing Volumes (Thousand Barrels per Day) Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q White Cliffs Pipeline Volumes (4) Glass Mountain Pipeline Volumes (5) 10 (1) Weighted average term of storage contracts (2) Pipeline volumes include KS/OK system, ND transportation and Tampa pipeline (3) White Cliffs Pipeline is owned 51% by RRMS; reflects 100% throughput (4) Glass Mountain Pipeline is owned 50% by RRMS; average volumes for 1Q 2014 for two months operational; reflects 100% throughput (5) Includes intercompany trucking volumes

11 SemGas Natural Gas Business SemGas Areas of Operation Northern Oklahoma Average Processed Volume (mmcf/d) Located in liquids rich oil plays Five processing facilities mmcf/d of current capacity 1,300 miles of gathering lines Inventory of drilled but uncompleted wells to support production volumes Anticipate maintaining 3Q 2015 processing volumes through Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q Processing Volumes Capacity 11

12 SemCAMS Natural Gas Business Average Throughput Volume (mmcf/d) SemCAMS Areas of Operation Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q K3 KA Capacity Located in: Western Canadian Sedimentary Basin sour gas Montney liquids rich sour gas Duvernay liquids rich sweet gas 600 miles of transport and gathering lines Strong incumbent position to serve industry s growing infrastructure needs 12

13 Maurepas Pipeline Overview Project Construct, own and operate three pipelines for Motiva Enterprises, LLC in St. James, LA connecting Motiva's refineries 24-inch, 34 mile crude oil pipeline connected to LOCAP, crossing the Mississippi River and terminating at Motiva's Norco refinery; and 12-inch, 35 mile intermediates pipeline between Motiva's Norco and Convent refineries; and 6-inch, 35 mile intermediates pipeline between Motiva's Norco and Convent refineries This project is supported by long-term transportation agreements with Motiva and is expected to be operational in the fourth quarter of 2016 The pipeline project is a significant part of an overall refinery optimization project Strategic Rationale First step in establishing a SemGroup presence in US Gulf Coast crude markets and it provides a more balanced risk profile through geographic diversity, new customer base and potential for product expansion Platform for future participation in the build-out of infrastructure in the Gulf Coast Accomplishes strategic goal of becoming more refinery facing Furthers SemGroup s drop down inventory to Rose Rock Project Progress 90% of planning process complete Majority of Right-of-Way acquired, permits in process and major equipment has been ordered 13

14 14 Maurepas Pipeline Area Map

15 2015 Updated Capital Expenditure Guidance (1) 2015 Capital Expenditures $650 million $245 38% $355 54% $45 7% Natural Gas Crude Other Growth Projects Maintenance $5 1% Project update - Platteville expansion completed - Maurepas Pipeline on-track for a Q completion Growth capex guidance reduced $90 million to reflect timing of capital spend Reduced capex guidance $35 million primarily a result of a decrease in SemGas well connects More than 90% of capital expenditures are focused on growth capital Targeting EBITDA multiples of 5-8x on organic growth projects in key asset plays (1) Guidance updated November 5,

16 2015 Updated Capital Expenditure Guidance (1) (in millions) Segment Description SemGroup Estimated Completion Date 2015 Capex 2016 Capex Crude Maurepas Pipeline 4Q SemGas Northern Oklahoma gas gathering & processing expansion varies SemCAMS Wapiti Pipeline Expansion varies SemCAMS K3 Plant projects varies SemCAMS KA Plant projects varies Other/undesignated growth projects varies 60 TBD Maintenance Total SemGroup $500 Rose Rock Midstream Crude White Cliffs Pipeline capacity expansion (2) 1H Crude Isabel Pipeline 1Q Crude Platteville truck unloading expansion October Crude Wattenberg Oil Trunkline extension 1Q Other/undesignated growth projects 30 Maintenance Total Rose Rock Midstream $150 Total $650 TBD Total Project 16 (1) Guidance updated November 5, 2015; 2016 Guidance to be provided February 25, 2016 (2) Investments in affiliate; reflects our ownership in joint ventures

17 Third Quarter 2015 Adjusted EBITDA (1) 3Q Q Q months ending 9/30/15 9 months ending 9/30/14 Crude (2) $ 42.2 $ 43.8 $ 41.6 $ $ SemGas SemCAMS SemLogistics (0.8) SemMaterials Mexico SemStream Corporate and Other (4.1) (3.7) (6.4) (14.2) (11.9) SemGroup $ 76.0 $ 80.0 $ 70.0 $ $ Rose Rock Midstream $ 41.9 $ 44.7 $ 42.1 $ $ 82.8 $350 $300 $250 $200 $150 $116 SEMG Adjusted EBITDA (1) (in millions) $135 $189 $287 $305-$315 $200 $150 $100 $50 $35 $40 RRMS Adjusted EBITDA (1) (in millions) $69 $128 $175-$185 $ E $ E 17 (1) Non-GAAP Financial Data Reconciliations can be found on the company website (2) SemGroup includes fully consolidated Rose Rock Midstream (3) Prior period financial information has been recast to reflect the effects of the dropdown of the Wattenberg Oil Trunkline (4) CAGR is based on the midpoint of 2015 Adjusted EBITDA Guidance

18 Leverage & Liquidity (in millions, unaudited) SemGroup Rose Rock September 30, 2015 September 30, 2015 $500 million revolver $585 million revolver % Senior unsecured notes $ % Senior unsecured notes $ % Senior unsecured notes Total consolidated debt $300.0 $750.0 Compliance leverage ratio (1) 1.08x 3.96x Liquidity: Cash and cash equivalents $146.0 $44.0 Revolver availability (2) Total liquidity $641.5 $590.1 Nearly $1.2 Billion of Combined Liquidity 18 (1) Calculated per credit agreement definitions (2) Revolver availability less outstanding letters of credit

19 SemGroup s Fee-based Business Model Margin Contribution (1) 88% Fixed Fee Variable Fee Marketing SemGas (2) 72% 28% SemCAMS 100% SemLogistics 100% 6% 6% Fixed Fee Variable Fee Marketing SemMaterials Mexico 100% White Cliffs Pipeline 100% Rose Rock Midstream (3)(4) 85% 15% Margin Descriptions Fixed Fee Storage fees Transportation fees Unloading fees Gathering and processing fees Variable Fee Gas processing percent of proceeds Marketing Back-to-back marketing transactions 19 (1) LTM September 30, 2015 (2) SemGas 3Q 2015 margin contribution 73% fixed fee, 27% variable fee (3) Rose Rock Midstream includes White Cliffs and Glass Mtn Pipeline proportionate cash distributions (4) Marketing margin reduced by intercompany trucking expense

20 SemGroup Corporation Dividend Growth (1) 2015 Target Dividend Growth 50-60% year-over-year $ $ $ $ $ $ $ $ $ $ $ Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4QE (1) Assumes no further drop downs to Rose Rock or 3rd party acquisitions 20

21 Rose Rock Midstream Distribution Growth (1) 2015 Distribution Growth of more than 17% year-over-year $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Targeting current distribution and coverage of 1.0x or greater through 2016 (1) Assumes no further drop downs from SemGroup or 3rd party acquisitions 21

22 Company Highlights Prudent organic capital investment at 5-8x EBITDA multiples Capital spending can be accomplished without accessing capital markets Clean balance sheet provides significant financial flexibility SemGroup s strong sponsor support for Rose Rock creates value for both entities 22

23 SemGroup 2015 Cash Available for Dividends Reconciliation Nine Months Ended September 30, 2015 SemGroup Consolidated Net income $ 43.8 Add: Interest expense 50.6 Add: Income tax expense (benefit) 29.6 Add: Depreciation and amortization 74.4 EBITDA $ Selected items impacting comparability (49.9) Stand-alone Adjusted EBITDA $ Less: Cash interest expense 18.7 Less: Cash paid for income taxes 6.3 Less: Maintenance capital 16.6 SEMG cash available for dividends $ Dividends declared $ 54.7 Coverage 2.0x Selected Items Impacting Comparability Less RRMS EBITDA $ (110.2) Plus RRMS cash distributions received 52.9 Loss (gain) on disposal or impairment of long-lived assets, net 1.3 Foreign currency transaction (gain) loss (1.2) Remove NGL equity earnings including gain on issuance of common units (11.1) Remove gain on sale of NGL units (14.5) Plus NGL cash distributions received 14.2 M&A transaction related costs 10.0 Legal settlement expense 3.4 Bankruptcy related expenses 0.2 Non-cash equity compensation 5.1 Selected items impacting comparability $ (49.9) 23 Note: Cash available for dividends should not be viewed as indicative of the actual amount of cash that is available for dividends or that is planned to be distributed in a given period. Potential incremental costs that would be required to repatriate foreign earnings have not been included.

24 Non-GAAP Reconciliations

25 SemGroup Consolidated Balance Sheets (in thousands, unaudited, condensed) September 30, 2015 ASSETS December 31, 2014 Current assets $ 571,241 $ 479,280 Property, plant and equipment, net 1,474,947 1,256,825 Goodwill and other intangible assets 222, ,391 Equity method investments 547, ,920 Other noncurrent assets, net 61,500 44,386 Total assets $ 2,877,568 $ 2,589,802 LIABILITIES AND OWNERS' EQUITY Current liabilities: Current portion of long-term debt $ 37 $ 40 Other current liabilities 378, ,622 Total current liabilities 378, ,662 Long-term debt, excluding current portion 1,044, ,092 Other noncurrent liabilities 220, ,611 Total liabilities 1,643,406 1,370,365 Total owners' equity 1,234,162 1,219,437 Total liabilities and owners' equity $ 2,877,568 $ 2,589,802 25

26 SemGroup Consolidated Statements of Operations and Comprehensive Income (in thousands, except per share amounts, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Revenues $ 397,065 $ 594,235 $ 377,226 $ 1,072,601 $ 1,575,342 Expenses: Costs of products sold, exclusive of depreciation and amortization shown below 274, , , ,869 1,211,703 Operating 53,267 69,377 60, , ,579 General and administrative 23,045 23,296 22,917 78,272 63,882 Depreciation and amortization 26,022 25,200 24,674 74,430 70,899 Loss (gain) on disposal or impairment of long-lived assets, net (951) 1,376 1,372 1,479 20,633 Total expenses 376, , ,921 1,032,207 1,546,696 Earnings from equity method investments 16,237 14,223 23,903 60,699 48,372 Gain on issuance of common units by equity method investee ,772 5,897 6,033 26,899 Operating income 37,416 49,918 53, , ,917 Other expenses (income), net 17,829 (6,368) 9,809 33,725 30,618 Income from continuing operations before income taxes 19,587 56,286 43,296 73,401 73,299 Income tax expense 10,006 24,090 14,861 29,609 33,944 Income from continuing operations 9,581 32,196 28,435 43,792 39,355 Loss from discontinued operations, net of income taxes (1) (2) (3) (5) Net income 9,580 32,196 28,433 43,789 39,350 Less: net income attributable to noncontrolling interests 4,707 6,934 5,136 14,153 18,184 Net income attributable to SemGroup Corporation $ 4,873 $ 25,262 $ 23,297 $ 29,636 $ 21,166 Net income attributable to SemGroup Corporation $ 4,873 $ 25,262 $ 23,297 $ 29,636 $ 21,166 Other comprehensive income (loss), net of income taxes (20,210) (10,331) 5,520 (23,750) (6,618) Comprehensive income (loss) attributable to SemGroup Corporation $ (15,337) $ 14,931 $ 28,817 $ 5,886 $ 14,548 Net income per common share Basic $ 0.11 $ 0.59 $ 0.53 $ 0.68 $ 0.50 Diluted $ 0.11 $ 0.59 $ 0.53 $ 0.67 $ 0.49 Weighted average shares (thousands): Basic 43,808 42,708 43,798 43,775 42,674 Diluted 43,971 43,013 44,013 43,969 42,976 26

27 SemGroup Non-GAAP Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Reconciliation of net income to Adjusted EBITDA: Net income $ 9,580 $ 32,196 $ 28,433 $ 43,789 $ 39,350 Add: Interest expense 19,170 14,807 16,822 50,583 34,394 Add: Income tax expense 10,006 24,090 14,861 29,609 33,944 Add: Depreciation and amortization expense 26,022 25,200 24,674 74,430 70,899 EBITDA 64,778 96,293 84, , ,587 Selected Non-Cash Items and Other Items Impacting Comparability 11,171 (16,868) (4,764) 27,546 25,647 Adjusted EBITDA $ 75,949 $ 79,425 $ 80,026 $ 225,957 $ 204,234 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal or impairment of long-lived assets, net $ (951) $ 1,376 $ 1,372 $ 1,479 $ 20,633 Loss from discontinued operations, net of income taxes Foreign currency transaction (gain) loss (385) 128 (295) (1,199) (388) Remove NGL equity earnings including gain on issuance of common units 742 (14,290) (12,117) (11,070) (30,976) Remove gain on sale of NGL units (26,748) (6,623) (14,517) (26,748) NGL cash distribution 4,752 6,450 4,468 14,235 17,462 M&A transaction related costs 10,000 Inventory valuation adjustments including equity method investees ,377 Employee severance expense Unrealized gain on derivative activities (4,546) (411) (1,415) (3,316) (656) Change in fair value of warrants 5,550 23,499 Depreciation and amortization included within equity earnings 6,412 4,887 6,346 19,134 12,588 Bankruptcy related expenses Charitable contributions 3,298 3,298 Legal settlement expense 3,394 3,394 Recovery of receivables written off at emergence (664) Non-cash equity compensation 1,556 2,686 3,427 7,760 6,482 Selected Non-Cash items and Other Items Impacting Comparability $ 11,171 $ (16,868) $ (4,764) $ 27,546 $ 25,647 27

28 SemGroup 2015 Adjusted EBITDA Guidance (in millions, unaudited) 2015 Guidance (1) Mid-point Net income $ 62.0 Add: Interest expense 69.0 Add: Income tax expense 38.0 Add: Depreciation and amortization EBITDA $ Selected Non-Cash and Other Items Impacting Comparability 37.0 Adjusted EBITDA $ Selected Non-Cash and Other Items Impacting Comparability Depreciation and amortization included within equity earnings 25.5 Loss on disposal 1.5 Foreign currency transaction gain (1.2) Inventory valuation adjustments including equity method investees 1.4 Remove gain on sale of NGL units (14.5) Non-cash equity compensation 10.9 M&A related transaction costs 10.0 Legal settlement expense 3.4 Selected Non-Cash and Other Items Impacting Comparability $ 37.0 (1) Guidance is on a cash basis for equity investments in NGL, includes fully consolidated Rose Rock Midstream 28

29 Crude Segment Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Net income (1) $ 9,834 $ 15,950 $ 13,954 $ 33,450 $ 44,182 Add: Interest expense 16,202 10,525 13,088 39,936 20,388 Add: Depreciation and amortization expense 10,634 8,395 10,608 31,385 27,153 EBITDA 36,670 34,870 37, ,771 91,723 Selected Non-Cash Items and Other Items Impacting Comparability 5,497 5,698 6,134 22,781 14,240 Adjusted EBITDA $ 42,167 $ 40,568 $ 43,784 $ 127,552 $ 105,963 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ (603) $ 291 $ (79) $ (530) $ 230 Employee severance expense Unrealized gain on derivative activities (4,546) (411) (1,415) (3,316) (656) Depreciation and amortization included within equity earnings 6,412 4,887 6,346 19,134 12,588 Inventory valuation adjustments including equity method investees ,377 Legal settlement expense 3,394 3,394 Non-cash equity compensation ,213 2,683 2,069 Selected Non-Cash items and Other Items Impacting Comparability $ 5,497 $ 5,698 $ 6,134 $ 22,781 $ 14, (1) Crude segment includes fully consolidated Rose Rock Midstream

30 SemGas Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Net income (loss) $ 4,754 $ 7,448 $ 7,043 $ 16,688 $ (1,555) Add: Interest expense 3,504 2,330 3,269 9,624 6,032 Add: Depreciation and amortization expense 8,601 7,064 7,359 23,098 19,312 EBITDA 16,859 16,842 17,671 49,410 23,789 Selected Non-Cash Items and Other Items Impacting Comparability ,778 2,539 20,748 Adjusted EBITDA $ 17,420 $ 17,102 $ 19,449 $ 51,949 $ 44,537 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ 445 $ (12) $ 1,450 $ 1,894 $ 20,092 Bankruptcy related expenses Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ 561 $ 260 $ 1,778 $ 2,539 $ 20,748 30

31 SemCAMS Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Net income $ 2,119 $ 5,310 $ 915 $ 4,233 $ 12,604 Add: Interest expense 2,270 3,918 3,117 8,499 11,869 Add: Income tax expense 2,361 2, , Add: Depreciation and amortization expense 3,198 5,113 3,187 9,451 11,021 EBITDA 9,948 16,363 7,835 25,711 36,367 Selected Non-Cash Items and Other Items Impacting Comparability (745) Adjusted EBITDA $ 9,203 $ 16,836 $ 8,532 $ 26,087 $ 36,480 Selected Non-Cash Items and Other Items Impacting Comparability Foreign currency transaction (gain) loss $ 3 $ 1 $ 145 $ 104 $ (21) Gain on disposal of long-lived assets, net (917) (35) (917) (950) Recovery of receivables written off at emergence (664) Employee severance Non-cash equity compensation ,189 1,658 Selected Non-Cash items and Other Items Impacting Comparability $ (745) $ 473 $ 697 $ 376 $

32 SemLogistics Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Net income (loss) $ (1,077) $ (6,057) $ 103 $ (2,900) $ (6,099) Add: Interest expense ,341 1,107 Add: Income tax expense (benefit) (170) (1,038) 167 (372) (1,565) Add: Depreciation and amortization expense 2,173 2,543 2,154 6,367 7,593 EBITDA 1,359 (4,156) 2,867 4,436 1,036 Selected Non-Cash Items and Other Items Impacting Comparability 670 1,898 (674) 801 (1,845) Adjusted EBITDA $ 2,029 $ (2,258) $ 2,193 $ 5,237 $ (809) Selected Non-Cash Items and Other Items Impacting Comparability Loss from discontinued operations, net of income taxes $ $ $ $ $ 4 Gain on disposal of long-lived assets, net 1,139 (2,495) Foreign currency transaction (gain) loss (873) Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ 670 $ 1,898 $ (674) $ 801 $ (1,845) 32

33 SemMaterials México Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, Net income $ 2,473 $ 1,484 $ 3,199 $ 8,683 $ 4,534 Add: Interest expense Add: Income tax expense 642 1, ,396 3,134 Add: Depreciation and amortization expense 993 1,655 1,037 3,083 4,538 EBITDA 4,152 4,331 5,002 14,208 12,372 Selected Non-Cash Items and Other Items Impacting Comparability Adjusted EBITDA $ 4,632 $ 4,451 $ 5,262 $ 15,167 $ 12,571 Selected Non-Cash Items and Other Items Impacting Comparability Gain (loss) on disposal of long-lived assets, net $ 124 $ (7) $ $ 105 $ (35) Foreign currency transaction loss (gain) (51) Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ 480 $ 120 $ 260 $ 959 $

34 Rose Rock Midstream Consolidated Statements of Income (in thousands, except per unit data, unaudited) Three Months Ended Nine Months Ended Revenues, including revenues from affiliates September 30, June 30, September 30, (1) (1) Product $ 211,881 $ 346,496 $ 193,525 $ 511,973 $ 879,873 Service 29,205 30,360 29,778 87,109 81,653 Total revenues 241, , , , ,526 Expenses, including expenses from affiliates Costs of products sold, exclusive of depreciation and amortization 195, , , , ,928 Operating 19,081 22,130 23,656 63,688 54,783 General and administrative 4,339 4,444 6,329 16,288 14,382 Depreciation and amortization 10,634 8,395 10,608 31,385 27,153 Total expenses 229, , , , ,246 Earnings from equity method investments 17,115 16,289 17,683 55,662 39,660 Operating income 28,903 24,530 27,260 78,769 60,940 Other expenses: Interest expense 12,491 8,010 10,197 30,694 13,127 Other income (9) (5) (14) (21) Total other expenses, net 12,482 8,010 10,192 30,680 13,106 Net income 16,421 16,520 17,068 48,089 47,834 Less: net income attributable to noncontrolling interests 7,758 Net income attributable to Rose Rock Midstream, L.P. $ 16,421 $ 16,520 $ 17,068 $ 48,089 $ 40,076 1) Prior period financial information has been recast to reflect the effects of the dropdown of the Wattenberg Oil Trunkline 34

35 Rose Rock Midstream Consolidated Statements of Income (Continued) (in thousands, except per unit data, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, (1) (1) Net income allocated to general partner $ 5,658 $ 2,193 $ 5,323 $ 15,723 $ 4,065 Net income allocated to common unitholders $ 10,763 $ 10,370 $ 11,745 $ 32,366 $ 25,989 Net income allocated to subordinated unitholders $ $ 4,226 $ $ $ 11,086 Net income (loss) allocated to Class A unitholders $ $ (269) $ $ $ (1,064) Net income (loss) per limited partner unit: Common unit (basic) $ 0.29 $ 0.50 $ 0.32 $ 0.90 $ 1.37 Common unit (diluted) $ 0.29 $ 0.50 $ 0.32 $ 0.89 $ 1.36 Subordinated unit (basic and diluted) $ $ 0.50 $ $ $ 1.32 Class A unit (basic and diluted) $ $ (0.07) $ $ $ (0.36) Basic weighted average number of limited partner units outstanding: Common units 36,792 20,574 36,790 36,136 19,029 Subordinated units 8,390 8,390 Class A units 3,750 2,953 Diluted weighted average number of limited partner units outstanding: Common units 36,831 20,646 36,839 36,179 19,088 Subordinated units (2) 8,390 8,390 Class A units (3) 3,750 2, (1) Prior period financial information has been recast to reflect the effects of the dropdown of the Wattenberg Oil Trunkline (2) The Subordinated Units converted to Common Units on February 17, 2015 (3) The Class A units converted to Common Units on January 1, 2015

36 Rose Rock Midstream Non-GAAP Financial Data Reconciliations (in thousands, unaudited) Three Months Ended Nine Months Ended September 30, June 30, September 30, (1) (1) Reconciliation of operating income to Adjusted gross margin: Operating income $ 28,903 $ 24,530 $ 27,260 $ 78,769 $ 60,940 Add: Operating expense 19,081 22,130 23,656 63,688 54,783 General and administrative expense 4,339 4,444 6,329 16,288 14,382 Depreciation and amortization expense 10,634 8,395 10,608 31,385 27,153 Less: Earnings from equity method investments 17,115 16,289 17,683 55,662 39,660 Non-cash unrealized gain on derivatives, net 4, ,415 3, Adjusted gross margin $ 41,296 $ 42,799 $ 48,755 $ 131,038 $ 116,942 Reconciliation of net income to Adjusted EBITDA: Net income $ 16,421 $ 16,520 $ 17,068 $ 48,089 $ 47,834 Add: Interest expense 12,491 8,010 10,197 30,694 13,127 Depreciation and amortization expense 10,634 8,395 10,608 31,385 27,153 Cash distributions from equity method investments 23,602 17,029 25,560 75,227 45,081 Inventory valuation adjustment 48 1,235 Non-cash equity compensation , Loss (gain) on disposal of long-lived assets, net (22) Less: Earnings from equity method investments 17,115 16,289 17,683 55,662 39,660 White Cliffs cash distributions attributable to noncontrolling interests 1,658 11,008 Impact from derivative instruments: Total gain (loss) on derivatives, net 6,036 4,047 (2,202) 3,190 1,298 Total realized loss (gain) (cash flow) on derivatives, net (1,490) (3,636) 3, (642) Non-cash unrealized gain on derivatives, net 4, ,415 3, Adjusted EBITDA $ 41,872 $ 32,202 $ 44,718 $ 128,708 $ 82,806 Reconciliation of net cash provided by operating activities to Adjusted EBITDA: Net cash provided by operating activities $ 32,431 $ 21,152 $ 26,941 $ 52,302 $ 46,270 Less: Changes in operating assets and liabilities, net 8,710 (4,441) (386) (28,184) (29,999) White Cliffs cash distributions attributable to noncontrolling interests 1,658 11,008 Add: Interest expense, excluding amortization of debt issuance costs 11,664 7,527 9,515 28,658 12,124 Distributions from equity method investments in excess of equity in earnings 6, ,876 19,564 5,421 Adjusted EBITDA $ 41,872 $ 32,202 $ 44,718 $ 128,708 $ 82,806 (1) Prior period financial information has been recast to reflect the effects of the dropdown of the Wattenberg Oil Trunkline 36

37 Rose Rock Midstream 2015 Adjusted EBITDA Guidance (in millions, unaudited) 2015 Guidance Mid-point Net income $ 70.3 Add: Interest expense 43.0 Add: Depreciation and amortization 42.0 EBITDA $ Non-Cash and Other Adjustments 24.7 Adjusted EBITDA $ Less: Cash interest expense 40.0 Maintenance capital expenditures 10.0 Distributable cash flow $ Non-Cash and Other Adjustments Earnings from equity method investments $ (77.0) Distributions from equity method investments (1) 99.0 Inventory valuation adjustment 1.2 Non-cash equity compensation 1.5 Non-Cash and Other Adjustments $ 24.7 (1) Distributions from equity method investment includes the cash distributions from White Cliffs and Glass Mountain attributable to Rose Rock 37

38 Rose Rock Midstream Distributable Cash Flow (in thousands, unaudited) Three Months Ended Nine Months Ended Reconciliation of net income to distributable cash flow: September 30, June 30, September 30, (1) (1) Net income $ 16,421 $ 16,520 $ 17,068 $ 48,089 $ 47,834 Add: Interest expense 12,491 8,010 10,197 30,694 13,127 Depreciation and amortization expense 10,634 8,395 10,608 31,385 27,153 EBITDA 39,546 32,925 37, ,168 88,114 Add: Loss (gain) on disposal of long-lived assets, net (22) Cash distributions from equity method investments 23,602 17,029 25,560 75,227 45,081 Inventory valuation adjustment 48 1,235 Non-cash equity compensation , Less: Earnings from equity method investments 17,115 16,289 17,683 55,662 39,660 White Cliffs cash distributions attributable to noncontrolling interests 1,658 11,008 Non-cash unrealized gain (loss) on derivatives, net 4, ,415 3, Adjusted EBITDA $ 41,872 $ 32,202 $ 44,718 $ 128,708 $ 82,806 Less: Cash interest expense 11,364 7,502 9,764 28,582 12,049 Maintenance capital expenditures 2,892 1,850 4,855 8,674 4,236 Distributable cash flow $ 27,616 $ 22,850 $ 30,099 $ 91,452 $ 66,521 Distribution declared $ 30,221 $ 18,866 $ 29,483 $ 88,083 $ 49,487 Distribution coverage ratio 0.91 x 1.21 x 1.02 x 1.04 x 1.34 x (1) Prior period financial information has been recast to reflect the effects of the dropdown of the Wattenberg Oil Trunkline 38

39 SemGroup Reconciliation of Net Income to Adjusted EBITDA (in thousands, unaudited) Three Months Ended March 31, 2015 Crude SemStream SemCAMS SemLogistics SemMexico SemGas Corporate and other Consolidated Net income (loss) $ 9,662 $ 8,908 $ 1,199 $ (1,926) $ 3,011 $ 4,891 $ (19,969) $ 5,776 Add: Interest expense 10,646 (1,322) 3, ,851 (1,161) 14,591 Add: Income tax expense (benefit) 551 (369) 990 3,570 4,742 Add: Depreciation and amortization expense 10,143 3,066 2,040 1,053 7, ,734 EBITDA 30,451 7,586 7, ,054 14,880 (17,266) 48,843 Selected Non-Cash Items and Other Items Impacting Comparability 11,150 (2,574) ,915 21,139 Adjusted EBITDA $ 41,601 $ 5,012 $ 8,352 $ 1,015 $ 5,273 $ 15,080 $ (6,351) $ 69,982 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ 152 $ $ $ $ (19) $ (1) $ 926 $ 1,058 Foreign currency transaction (gain) loss (44) (1,257) (519) Remove NGL equity losses including gain on issuance of common units Remove gain on sale of NGL units (7,894) (7,894) NGL cash distribution 5,015 5,015 M&A transaction related costs 10,000 10,000 Unrealized loss on derivative activities 2,645 2,645 Depreciation and amortization included within equity earnings 6,376 6,376 Inventory valuation adjustment including equity method investees 1,187 1,187 Bankruptcy related expenses Non-cash equity compensation ,057 2,777 Selected Non-Cash Items and Other Items Impacting Comparability $ 11,150 $ (2,574) $ 424 $ 805 $ 219 $ 200 $ 10,915 $ 21,139 39

40 SemGroup Reconciliation of Net Income to Adjusted EBITDA (in thousands, unaudited) Year Ended December 31, 2014 Corporate and Crude SemStream SemCAMS SemLogistics SemMexico SemGas other Consolidated Net income (loss) $ 57,495 $ 70,632 $ 14,318 $ (10,072) $ 5,900 $ 6,792 $ (93,008) $ 52,057 Add: Interest expense 31,072 (5,140) 13,558 1, ,570 (710) 49,044 Add: Income tax expense (benefit) 3,135 (2,231) 4,053 41,556 46,513 Add: Depreciation and amortization expense 40,035 14,295 10,005 6,031 26,353 1,678 98,397 EBITDA 128,602 65,492 45,306 (770) 16,150 41,715 (50,484) 246,011 Selected Non-Cash Items and Other Items Impacting Comparability 28,159 (42,165) 590 (1,083) ,053 34,255 41,430 Adjusted EBITDA $ 156,761 $ 23,327 $ 45,896 $ (1,853) $ 16,771 $ 62,768 $ (16,229) $ 287,441 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ 319 $ $ (950) $ (2,490) $ (53) $ 20,092 $ 15,674 $ 32,592 Loss (income) from discontinued operations, net of income taxes (1) 2 1 Foreign currency transaction (gain) loss (1,228) (86) Remove NGL equity earnings including gain on issuance of common units (31,363) (31,363) Remove gain on sale of NGL units (34,211) (34,211) NGL cash distribution 23,404 23,404 Employee severance expense Unrealized gain on derivative activities (1,734) (1,734) Change in fair value of warrants 13,423 13,423 Depreciation and amortization included within equity earnings 18,992 18,992 Inventory valuation adjustment including equity method investees 7,781 7,781 Recovery of receivables written off at emergence (664) (664) Bankruptcy related expenses ,159 1,310 Charitable contributions 3,379 3,379 Non-cash equity compensation 2, , ,826 8,386 Selected Non-Cash Items and Other Items Impacting Comparability $ 28,159 $ (42,165) $ 590 $ (1,083) $ 621 $ 21,053 $ 34,255 $ 41,430 40

41 SemGroup Reconciliation of Net Income to Adjusted EBITDA (in thousands, unaudited) Year Ended December 31, 2013 Corporate and Crude SemStream SemCAMS SemLogistics SemMexico SemGas other Consolidated Net income (loss) $ 57,228 $ 38,071 $ (3,136) $ (6,769) $ 5,377 $ 14,701 $ (39,660) $ 65,812 Add: Interest expense 14,923 (4,810) 18,928 1, ,268 (8,790) 25,142 Add: Income tax expense (benefit) 6,348 (5,699) 2,589 (20,492) (17,254) Add: Depreciation and amortization expense 23,708 10,766 9,426 5,991 14,517 2,001 66,409 EBITDA 95,859 33,261 32,906 (1,607) 14,145 32,486 (66,941) 140,109 Selected Non-Cash Items and Other Items Impacting Comparability 10,764 (15,624) 1, (722) 1,221 51,979 48,909 Adjusted EBITDA $ 106,623 $ 17,637 $ 34,086 $ (1,496) $ 13,423 $ 33,707 $ (14,962) $ 189,018 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ (56) $ 6 $ $ $ (854) $ 665 $ $ (239) Income from discontinued operations, net of income taxes (59) (59) Foreign currency transaction (gain) loss (23) (391) (177) (1,042) (1,633) Remove NGL equity earnings (33,996) (33,996) NGL cash distribution 18,321 18,321 Mid-America Midstream Gas Services acquisition cost 3,600 3,600 Employee severance expense Unrealized gain on derivative activities (974) (974) Change in fair value of warrants 46,434 46,434 Depreciation and amortization included within equity in earnings of White Cliffs 9,520 9,520 Bankruptcy related expenses Non-cash equity compensation 2, , ,446 7,330 Selected Non-Cash Items and Other Items Impacting Comparability $ 10,764 $ (15,624) $ 1,180 $ 111 $ (722) $ 1,221 $ 51,979 $ 48,909 41

42 SemGroup Reconciliation of Net Income to Adjusted EBITDA (in thousands, unaudited) Year Ended December 31, 2012 Crude SemStream SemCAMS SemLogistics SemMexico SemGas Corporate and other Consolidated Net income (loss) $ 64,554 $ 4,919 $ 4,097 $ (3,552) $ 1,467 $ (264) $ (39,324) $ 31,897 Add: Interest expense (409) (3,449) 18,727 2, ,461 (10,228) 8,902 Add: Income tax expense (benefit) 720 (7,736) 2,285 2,653 (2,078) Add: Depreciation and amortization expense 12,131 10,589 9,780 6,171 7,043 2,496 48,210 EBITDA 76,276 1,470 34, ,237 8,240 (44,403) 86,931 Selected Non-Cash Items and Other Items Impacting Comparability 9,532 6, ,236 48,034 Adjusted EBITDA $ 85,808 $ 8,422 $ 34,183 $ 1,492 $ 10,358 $ 8,869 $ (14,167) $ 134,965 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ (3,501) $ 214 $ $ $ (290) $ 46 $ $ (3,531) Loss (income) from discontinued operations, net of income taxes (2,985) (2,939) Foreign currency transaction (gain) loss 26 (370) Remove NGL equity earnings NGL cash distribution 9,218 9,218 Employee severance expense Unrealized loss on derivative activities 1,196 1,196 Change in fair value of warrants 21,310 21,310 Depreciation and amortization included within equity in earnings of White Cliffs 10,181 10,181 Defense costs 5,899 5,899 Recovery of receivables written off at emergence (858) (858) Non-cash equity compensation 1, ,348 6,503 Selected Non-Cash Items and Other Items Impacting Comparability $ 9,532 $ 6,952 $ 50 $ 514 $ 121 $ 629 $ 30,236 $ 48,034 42

43 SemGroup Reconciliation of Net Income to Adjusted EBITDA (in thousands, unaudited) Year Ended December 31, 2011 Crude SemStream SemCAMS SemLogistics SemMexico SemGas Corporate and other Consolidated Net income (loss) $ 39,241 $ 16,752 $ 2,868 $ (41,440) $ 2,430 $ 6,308 $ (23,347) $ 2,812 Add: Interest expense 3,749 17,152 24,685 1, ,346 10,836 60,138 Add: Income tax expense (benefit) 552 (3,331) 629 (160) (2,310) Add: Depreciation and amortization expense 11,379 3,501 10,233 9,271 6,502 5,986 2,951 49,823 EBITDA 54,369 37,405 38,338 (34,495) 9,926 14,640 (9,720) 110,463 Selected Non-Cash Items and Other Items Impacting Comparability 8,293 (48,513) (2,296) 45, ,806 5,082 Adjusted EBITDA $ 62,662 $ (11,108) $ 36,042 $ 10,788 $ 9,983 $ 15,092 $ (7,914) $ 115,545 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ 64 $ (45,821) $ (8) $ 44,663 $ (200) $ 4 $ 1,599 $ 301 Loss (income) from discontinued operations, net of income taxes (1) 9, (126) 9,548 Foreign currency transaction (gain) loss 39 (2,674) (921) (3,450) Employee severance expense 3, ,374 Unrealized gain on derivative activities (787) (13,247) (80) (14,114) Change in fair value of warrants (5,012) (5,012) Reversal of allowance on goods and services tax receivable (4,144) (4,144) Depreciation and amortization included within equity in earnings of White Cliffs 10,630 10,630 Defense costs 1,000 1,000 Recovery of receivables written off at emergence (2,692) (2,692) Non-cash equity compensation 1, ,958 8,641 Selected Non-Cash Items and Other Items Impacting Comparability $ 8,293 $ (48,513) $ (2,296) $ 45,283 $ 57 $ 452 $ 1,806 $ 5, (1) SemStream Arizona has been reported as a discontinued operation at December 31, Prior periods have been recast to conform with the presentation.