Third Quarter 2015 Earnings Call. November 2, 2015

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1 Earnings Call November 2, 2015

2 Important Note to Investors This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Dominion and Dominion Midstream. The statements relate to, among other things, expectations, estimates and projections concerning the business and operations of Dominion and Dominion Midstream. We have used the words "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", outlook, "predict", "project", should, strategy, target, "will, potential and similar terms and phrases to identify forward-looking statements in this presentation. As outlined in our SEC filings, factors that could cause actual results to differ include, but are not limited to: unusual weather conditions and their effect on energy sales to customers and energy commodity prices; extreme weather events and other natural disasters; federal, state and local legislative and regulatory developments; changes to federal, state and local environmental laws and regulations, including proposed carbon regulations; cost of environmental compliance; changes in enforcement practices of regulators relating to environmental standards and litigation exposure for remedial activities; capital market conditions, including the availability of credit and the ability to obtain financing on reasonable terms; fluctuations in interest rates; changes in rating agency requirements or credit ratings and their effect on availability and cost of capital; impacts of acquisitions, divestitures, transfers of assets by Dominion to joint ventures or to Dominion Midstream, and retirements of assets based on asset portfolio reviews; receipt of approvals for, and timing of, closing dates for acquisitions; the execution of Dominion Midstream s growth strategy; changes in demand for Dominion s services; additional competition in Dominion s industries; changes to regulated rates collected by Dominion; changes in operating, maintenance and construction costs; timing and receipt of regulatory approvals necessary for planned construction or expansion projects and compliance with conditions associated with such regulatory approvals; the inability to complete planned construction projects within time frames initially anticipated; and the ability of Dominion Midstream to negotiate and consummate acquisitions from Dominion and third-parties, and the impacts of such acquisitions. Other risk factors are detailed from time to time in Dominion s and Dominion Midstream s quarterly reports on Form 10-Q or most recent annual report on Form 10-K filed with the Securities and Exchange Commission. The information in this presentation was prepared as of November 2, Dominion and Dominion Midstream undertake no obligation to update any forward-looking information statement to reflect developments after the statement is made. Projections or forecasts shown in this document are based on the assumptions listed in this document and are subject to change at any time. In addition, certain information presented in this document incorporates planned capital expenditures reviewed and endorsed by Dominion s Board of Directors in late Dominion undertakes no obligation to update such planned expenditures to reflect plan or project-specific developments, including regulatory developments, or other updates until the following annual update for the plans. Actual capital expenditures may be subject to regulatory and/or Board of Directors approval and may vary from these estimates. This presentation shall not constitute an offer to sell or the solicitation of an offer to buy securities. Any offers, solicitations or offers to buy, or any sales of securities will be made in accordance with the requirements of the Securities Act of 1933, as amended. This presentation has been prepared primarily for security analysts and investors in the hope that it will serve as a convenient and useful reference document. The format of this document may change in the future as we continue to try to meet the needs of security analysts and investors. This document is not intended for use in connection with any sale, offer to sell, or solicitation of any offer to buy securities. This presentation includes various estimates of EBITDA which is a non-gaap financial measure. Please see the third quarter 2015 Dominion Midstream Press Release for a reconciliation to GAAP. Please continue to regularly check Dominion s website at and Dominion Midstream s website at 2

3 Operating Earnings Summary Versus Guidance $1.10 $ rd Quarter Drivers $0.95 Higher merchant margins Lower operating expenses Delay in strategic undergrounding Guidance Range Actual Operating EPS* *See page 30 of the third quarter 2015 Earnings Release Kit for a reconciliation to GAAP. 3

4 Operating EBITDA Summary Versus Guidance (in $millions) Operating Segment Guidance EBITDA Actual EBITDA Drivers Dominion Virginia Power $390 - $410 $388 Delay in Strategic Undergrounding Dominion Generation $755 - $820 $796 Higher merchant margins Lower operating expenses Dominion Energy $310 - $335 $332 Higher distribution margins Lower operating expenses *See page 34 of the third quarter 2015 Earnings Release Kit for a reconciliation to GAAP. 4

5 Dominion Midstream Partners (DM) Earnings and Distribution Financial Results in line with Management expectations Net Income $18.0 million Adjusted EBITDA $20.3 million* Distributable Cash Flow $19.8 million* Distribution Results Board declared 3Q 2015 cash distribution of $0.20 per unit 7% increase above second-quarter Key DM Updates Acquired 25.93% interest in Iroquois Pipeline No asset drops or equity needed in 2016 to support 22% growth D initiated $50mm DM unit market purchase program *See the third quarter 2015 Dominion Midstream Press Release for a reconciliation to GAAP. 5

6 Cash Flow and Financing Activities Cash Flow & Liquidity $3.4 billion in funds from operations for the first 9 months of the year $2.6 billion in commercial paper and letters of credit outstanding $4.5 billion of credit facilities $2.0 billion of liquidity Equity Financing No additional public equity issuances needed this decade to fund growth projects Debt Financing DRI issued $650 million of ten-year notes in September Expect Dominion Gas debt issuance in fourth quarter 6

7 Operating Earnings Guidance Fourth Quarter 2015 $0.95 $0.84 $ th Quarter Drivers Growth projects Higher merchant margins Lower capacity payments Lower farmout earnings Share dilution 4Q 2014 EPS* 4Q 2015 Guidance* *See page 36 and 37 of the third quarter 2015 Earnings Release Kit for a reconciliation to GAAP. 7

8 Hedged Power Update Millstone Hedge Position 99% Hedged 83% Hedged $52.43 $65.06 $56.98 $51.93 $46.59 $ NEPOOL Baseload Avg Hedge Position NEPOOL ATC Power Price forward curves as of October 21,

9 Dominion Generation Growth Projects Update Brunswick County ~90% complete On Time, On Budget Expect in service mid-2016 Greensville County Construction of a ~1,588 MW natural gas fired plant Estimated Costs of $1.3 billion Filed CPCN/Rider July 2015 Hearing scheduled for Jan 2016 Expect in service Dec 2018 Subject to SCC approval Brunswick 9

10 Contracted Solar Strategy Recycle Capital through Joint Venture Joint Venture Announced in September Agreement to sell 33% ownership in 425 MW from 13, 14, & 15 projects ~$300M consideration from SunEdison Benefits: Immediately accretive to Dominion ITCs preserved Maintain flexibility to monetize remaining 67% stake Reduces financial and operational risk exposure Proceeds will be used to reduce DRI debt 10

11 Dominion Energy Growth Projects Update First Utica lease agreement closed in September Conveyed approximately 16,000 acres of development rights Atlantic Coast Pipeline & Supply Header (~1.5 Bcf/day each) Pipeline surveying over 85% complete and detailed engineering ~75% complete Awarded small diameter pipe contract in August Construction bids received and expect to award by the end of the year Filed FERC Applications September 2015 Begin construction in fourth quarter 2016 Expect in service November

12 Dominion Energy Cove Point Liquefaction Project is ~47% complete Engineering is ~95% complete Procurement of engineered equipment is ~95% complete Main cryogenic heat exchanger delivered in October All 34 FERC construction packages submitted and approved Construction is On-time & On-budget Heat exchanger 12

13 Gas Infrastructure Demand Driven Growth Focus on demand-driven projects moving gas to end use customers Cove Point Export Atlantic Coast Pipeline DTI Supply Header Nine Market Access Projects CPV St. Charles and Keys Energy power generation projects New Market and Leidy South projects from Leidy, PA Edgemoor in South Carolina ~3 Bcf/day of Growth Projects Underway Several other projects in the mid-atlantic, mid-west and southeast 13

14 Key Takeaways Highlights Executing the growth plan and delivering on guidance Dominion Operating earnings of $1.03 per share at midpoint of third quarter guidance range* Strong operating and safety performance in the third quarter Major growth projects continue, on-time and on-budget Dominion Midstream (DM) Financial and distribution results in line with expectations Declared third quarter distribution of $0.20 per unit 7% increase above second-quarter *See page 30 of the third quarter 2015 Earnings Release Kit for a reconciliation to GAAP. 14

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