Investor Presentation June 2018

Transcription

1 Investor Presentation June 2018

2 Company Information NYSE Ticker NGL Energy Partners LP Contact Information Corporate Headquarters NGL Energy Partners LP 6120 South Yale Avenue, Suite 805 Tulsa, Oklahoma Website Investor Relations Contact us at (918) or us at NGL Unit Price (1) $ Market Capitalization (1)(2) $ 1.83 Billion Enterprise Value (1)(2) $ 4.72 Billion Yield (1) 13.62% InvestorInfo@nglep.com Forward Looking Statements 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. (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 2

3 NGL Energy Partners LP Overview 3

4 Segment Business Contribution Overview Crude Logistics 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 Water Solutions Refined Products/ Renewables Liquids 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 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 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 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 30 th 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 4

5 Segment Retail Propane Contribution Divestiture Highlights On May 30 th 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 Proceeds to be used to meaningfully reduce debt and enhance liquidity ~$800 million of proceeds used to immediately repay certain indebtedness Expected to achieve and maintain target compliance leverage of ~ 3.25x Narrows operational scope to four business segments 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 Reduces seasonality and weather-dependency of NGL s earnings 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 nearterm cash flow per unit, with accretion being driven over time as a result of certain growth opportunities that are included in the FY2019 guidance Transitions to a self-funding model highlighted by low leverage and high distribution coverage 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 Retail Propane Customer Service Center Value received by NGL from propane divestitures totals ~ $1.1 billion (>10x FY18 EBITDA) Note: See press releases on NGL Energy Partners website 5

6 Business Diversity (Post Retail Propane Sale) NGL LOGO Crude Logistics Water Solutions Refined Products/ Renewables Liquids Primary Drivers: Crude Oil Production and Transportation/ Storage Demand Water Volumes, Rig Count and Crude Oil Price Motor Fuels Supply/Demand and Basis Differentials Butane Blending, Weather and NGL Production Benefits From: Higher Prices Higher Prices Lower Prices Lower Prices FY19 Forecasted EBITDA Contribution %: 29-32% 42-44% 12-15% 12-13% 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 6

7 Diversified Across Multiple Businesses and Producing Basins (Post Retail Propane Sale) Bakken Shale Marcellus Shale Green River Basin Pinedale Anticline DJ Basin Jonah Field Niobrara Shale Wattenberg Field Mississippi Lime Granite Wash Permian Basin NGL Owned/Leased Assets NGL Assets Water Services NGL Utilized Assets Common Carrier Propane Pipelines Colonial Products Pipeline Santa Fe Products Pipeline Magellan Products Pipeline NuStar Products Pipeline Eagle Ford NGL Rack Marketing Terminal NGL Gas Blending Terminal TransMontaigne Terminal NGL Renewable Marketing Terminal NuStar Energy Terminal Basins Assets and Marketing Presence Crude Barges and Tug Boats Crude Oil Logistics NGL Crude Terminal Grand Mesa Pipeline 7

8 NGL Operational Assumptions Business Strategy Build a Diversified Vertically Integrated Energy Business 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 Achieve Organic Growth by Investing in New Assets 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 Accretive Growth through Strategic Acquisitions 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 Businesses that Generate Long- Term Fee Based Cash Flows 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 8

9 Operating Segments 9

10 Crude Logistics Platform 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 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 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 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 970,000 BBL origin tankage 27 LACT units NGL Cushing Crude Oil Storage Tanks 4 NGL Crude Logistics Tows 10

11 Segment Grand Mesa Contribution Pipeline 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 DJ Basin 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 Niobrara Shale Wattenberg Field Batching Capabilities Gathering Connectivity Grand Mesa offers two unique batching specs allowing producers to preserve their crude oil quality The Lucerne origin has inbound receipt connections to multiple gathering systems including: Platte River Midstream Saddle Butte Pipeline Noble Midstream NGL Crude Terminal Grand Mesa Pipeline Cushing Storage 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 = Lucerne & Riverside = Platteville 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 11

12 Segment Crude Oil Contribution Logistics Crude WTI Spot Price Area of Operation $100 $80 $60 $40 $20 $- 3/31/2015 3/31/2016 3/31/2017 3/31/2018 Grand Mesa Pipeline FY 2019 Forecast Assumptions 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) $160 $120 $80 $40 $- Adjusted EBITDA (In Millions) $ $118 $12 $73 $61 $59 $13 $11 $106 $28 $48 $48 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E Glass Mountain Crude Oil Logistics 12

13 Water Solutions Platform 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 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) NGL saltwater disposal facility with solids processing capacity 13

14 Segment Water Solutions Contribution U.S Oil Rig Count (1) Area of Operation /31/2015 3/31/2016 3/31/2017 3/31/2018 Permian Basin Eagle Ford Basin DJ Basin FY 2019 Forecast Assumptions Adjusted EBITDA (In Millions) 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 $300 $200 $100 $68 $126 $72 $63 $116 $ 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 $- FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E (1) Baker Hughes as of March

15 NGL Liquids Platform 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 Propane/Butane Wholesale NGL Terminals Sawtooth 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 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 Railcar Rack NGL Thackerville Liquids Terminal West Memphis NGL Wholesale Liquids Terminal 15

16 Segment Liquids Contribution Heating Degree Days Area of Operation FY 2019 Forecast Assumptions Adjusted EBITDA (In Millions) 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 $150 $100 $50 $- $87 $93 $101 $64 $50 $55-70 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E 16

17 Refined Products & Renewables Platform 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 Southeast Gas Blending Rack Marketing and Other Line Space on Colonial and Plantation pipelines Long-term Lease of TLP SE Terminals along Colonial and Plantation Pipelines Approximately 7.0 million barrels of storage capacity 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 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 Utilizing 3 major Pipelines Magellan NuStar Explorer Ethanol and Biodiesel Blending Approximately 1.0 million barrels of storage capacity Collins, MS Refined Products Terminal 17

18 Segment Refined Products/Renewables Contribution DOE Total U.S. Gas Supplied (1) Area of Operation 10,000 9,500 9,000 8,500 8,000 7, to 2015 Average to 2015 Range FY 2019 Forecast Assumptions 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) $150 $100 $50 $- Adjusted EBITDA (In Millions) $134 $125 $79 $55-80 $49 $8 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E (1) Department of Energy EIA weekly data for 4/4/18. 18

19 Retail Propane Platform 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) 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 Own 300 bulk storage tanks with capacities ranging from 18,000 to 90,000 gallons 68% residential customers; 32% commercial and industrial customers 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 Aggregate distillate storage capacity of 5.7 million gallons Propane storage tanks at retail location Propane delivery truck 19

20 Segment Retail Propane Contribution Sample of Trade Names Area of Operation 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, 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 $120 $90 $60 $30 $- Adjusted EBITDA (In Millions) $27 $26 $27 $20 $23 $65 $70 $83 $70 $57 N/A FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019E Retail West Retail East 20

21 Financial Overview 21

22 Financial Objectives Strong Balance Sheet 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 Cash Flow Predictability Increasing fee-based business and long-term contracts with high credit quality customers Transitioning to a more traditional midstream repeatable cash flow model Lower Cost of Capital 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 Capital Projects 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 Robust Distribution Coverage Targeting over 1.3x distribution coverage Excess distribution coverage will be used to strengthen the balance sheet and fund growth opportunities 22

23 4 th 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 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 $37.6 million and the contribution of certain refined products rights and adjacent leasehold. Quarterly Summary Performance ($ s In Millions) 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) % Crude Oil (BBL's) 11,038 9,374 18% Liquids Propane (GAL's) 479, ,586 6% Butane (GAL's) 136, ,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, % Total Cost of Sales $ 4,850.4 $ 3, % Adjusted EBITDA(1) $ $ % Distributable Cash Flow(1) $ 98.6 $ % Distribution to LP Unitholders $ 0.39 $ % TTM Distribution Coverage 0.80x 1.15x Maintenance Capex $ 11.0 $ % Growth Capex with Investments $ 51.4 $ % Covenant Compliance Leverage (2) 4.4x 4.7x Total L-T Debt (Excluding Working Capital Facility) $ 1,713.1 $ 2, % Working Capital Facility $ $ % Total Liquidity $ $ % (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 23

24 Performance Metrics Adjusted EBITDA (In Millions) Acquisition, Growth and Maintenance Capex (In Millions) (1) $1,269 $443 $424 $381 $408 $450 $961 $24 $184 $271 $600 $491 $334 $ $133 $160 $138 $164 $162 $ $59 $14 $32 $35 $30 $26 $50 $38 $20-25 IPO FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E Distributable Cash Flow & Total Distributions (In Millions) (2) FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY 2018E FY 2019E Acquisitions Growth Capital Maintenance Capital Distribution Coverage $169 $168 $320 $266 $290 $274 $210 $182 $180 >$300 $225 ~$ x 1.2x 0.9x 1.2x 0.8x 1.3x 1.3x Target FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E Distributable Cash Flow Distributions FY 2014 FY 2015 FY2016 FY 2017 FY2018 FY2019E (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 24

25 Credit Profile $1,200 $1,000 $800 $600 $400 $200 Debt Maturities as of 3/31/18 (In Millions) $1,149 This is tied out $353 $367 $616 $389 $- Apr-18 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-24 Apr-25 Credit Facility due 10/ % Notes due 7/ % Notes due 10/ % Notes due 11/ % Notes due 2/2025 Capitalization (In Thousands) 3/31/ /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 , ,781 (7,357) 6.875% Senior Notes due , , % Senior Notes due , ,589 (40,642) 6.125% Senior Notes due , ,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) 6.00x Covenant Compliance Leverage (1) 10.75% Class A Convertible Preferred Units $ 82,576 $ 76,056 $ 6,520 Redeemable Noncontrolling Interest 9,927 4,011 5, x 3.00x 2.9x 3.2x 3.2x 3.9x 4.7x 4.4x 3.25x or less 3.25x Target 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 - Accumulated Other Comprehensive Loss (1,815) (1,478) (337) Noncontrolling interests 83,503 7,270 76, x Total Capitalization $ 3,915,567 $ 3,995,070 $ (79,503).00x FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY 2018 FY 2019E (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. 25

26 NGL Operational Assumptions 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 26

27 Appendix 27

28 NGL Organizational Chart Members 100% NGL Energy Holdings LLC G.P. (DE LLC) 0.1% GP Interest IDR s 121,083,664 C.U. Outstanding 99.9% LP Interest Limited Partners NGL Energy Partners LP (NYSE: NGL) (DE LP) 100% NGL Energy Operating LLC (DE LLC) NGL Crude Logistics (NGL Crude Logistics, LLC) (1) NGL Water Solutions (NGL Water Solutions, LLC) NGL Liquids (NGL Liquids, LLC) NGL Retail Propane (NGL Propane, LLC) NGL Refined Products/Renewables (TransMontaigne LLC) (1) Includes the operations of our Legacy Gavilon crude oil logistics, refined products, and renewables businesses. 28

29 4Q 18 Adjusted EBITDA & DCF Walk Three Months Ended March 31, Year Ended March 31, (in thousands) 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, , ,504 Income tax expense (benefit) 524 (97) 1,458 1,939 Depreciation and amortization 62,011 66, , ,583 EBITDA 220, , , ,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 ,365 Equity-based compensation expense 8,127 13,243 35,241 53,102 Acquisition expense ,771 Revaluation of liabilities 15,007 12,761 20,607 12,761 Other 1,785 (5,291) 10,081 2,443 Adjusted EBITDA 155, , , ,317 Less: Cash interest expense 45,785 45, , ,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 Distributable Cash Flow $ 98,576 $ 67,626 $ 179,987 $ 211,028 29

30 4Q 18 & 4Q 17 Adjusted EBITDA by Segment Three Months Ended March 31, 2018 Crude Oil Logistics Water Solutions Liquids Retail Propane (in thousands) 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, ,285 Amortization recorded to cost of sales ,348-1,503 Net unrealized losses (gains) on derivatives 293 2,168 (3,340) (89) - - (968) Inventory valuation adjustment ,594-4,594 Lower of cost or market adjustments (402) (Gain) loss on disposal or impairment of assets, net (103) 3,749 1 (90,213) (7,513) 8 (94,071) Equity-based compensation expense ,127 8,127 Acquisition expense Other income, net ,455 2,290 Adjusted EBITDA attributable to unconsolidated entities (69) 1,183-1,268 Adjusted EBITDA attributable to noncontrolling interest - (118) - (1,509) - - (1,627) Revaluation of liabilities - 15, ,007 Other 1, (41) - - 1,785 Adjusted EBITDA $ 31,904 $ 31,766 $ 14,957 $ 64,513 $ 25,644 $ (12,863) $ 155,921 Three Months Ended March 31, 2017 Crude Oil Logistics Water Solutions Liquids Retail Propane (in thousands) Refined Products and Renewables Corporate and Other Consolidated 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, ,929 Amortization recorded to cost of sales ,434-1,730 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) Equity-based compensation expense ,243 13,243 Acquisition expense Other income (expense), net 177 (785) ,175 1,902 Adjusted EBITDA attributable to unconsolidated entities 3, (39) 432-4,446 Adjusted EBITDA attributable to noncontrolling interest - (6,912) - (799) - - (7,711) Revaluation of liabilities - 12, ,761 Other Adjusted EBITDA $ 29,558 $ 18,212 $ 16,189 $ 48,869 $ 12,206 $ (3,871) $ 121,163 30

31 4Q 18 YTD & 4Q 17 YTD Adjusted EBITDA by Segment Year Ended March 31, 2018 Crude Oil Logistics Water Solutions Liquids Retail Propane (in thousands) Refined Products and Renewables Corporate and Other Consolidated 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, ,712 Amortization recorded to cost of sales ,479-6,099 Net unrealized losses (gains) on derivatives 2,766 13,694 (577) ,883 Inventory valuation adjustment ,033-11,033 Lower of cost or market adjustments (105) (Gain) loss on disposal or impairment of assets, net (111,393) 6, ,516 (88,209) (30,098) 8 (105,313) Equity-based compensation expense ,241 35,241 Acquisition expense Other income, net ,393 8,403 Adjusted EBITDA attributable to unconsolidated entities 11, ,308-17,216 Adjusted EBITDA attributable to noncontrolling interest - (737) - (1,894) - - (2,631) Revaluation of liabilities - 20, ,607 Other 10, (1,082) ,081 Adjusted EBITDA $ 117,661 $ 116,070 $ 49,739 $ 109,434 $ 49,255 $ (33,909) $ 408,250 Year Ended March 31, 2017 Refined Products and Crude Oil Logistics Water Solutions Liquids Retail Propane Renewables Corporate and Other Consolidated (in thousands) Operating (loss) income $ (17,475) $ 44,587 $ 43,252 $ 49,255 $ 222,546 $ (87,082) $ 255,083 Depreciation and amortization 54, ,758 19,163 42,966 1,562 3, ,205 Amortization recorded to cost of sales ,663-6,828 Net unrealized (gains) losses on derivatives (1,513) (2,088) (3,338) Inventory valuation adjustment ,368-7,368 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) Equity-based compensation expense ,102 53,102 Acquisition expense ,771 1,771 Other (expense) income, net (412) ,263 7,595 27,762 Adjusted EBITDA attributable to unconsolidated entities 11, (427) 3,975-15,243 Adjusted EBITDA attributable to noncontrolling interest - (9,210) - (1,241) - - (10,451) Revaluation of liabilities - 12, ,761 Other 1, ,443 Adjusted EBITDA $ 59,417 $ 63,461 $ 63,656 $ 90,817 $ 124,969 $ (21,003) $ 381,317 31