Investor Presentation

Transcription

1 Investor Presentation Second Quarter 2017 Results August 2017

2 Non-GAAP Financial Measures Investor Presentation - August 2017 SemGroup s non-gaap measure, Adjusted EBITDA, is not a GAAP measure and is not intended to be used in lieu of GAAP presentation of net income (loss), which is the most closely associated GAAP measure. 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. In addition to non-cash items, we have selected items for adjustment to EBITDA which management feels decrease the comparability of our results among periods. These items are identified as those which are generally outside of the results of day to day operations of the business. These items are not considered non-recurring, infrequent or unusual, but do erode comparability among periods in which they occur with periods in which they do not occur or occur to a greater or lesser degree. Historically, we have selected items such as gains on the sale of NGL Energy Partners LP common units, costs related to our predecessor s bankruptcy, significant business development related costs, significant legal settlements, severance and other similar costs. Management believes these types of items can make comparability of the results of day to day operations among periods difficult and have chosen to remove these items from our Adjusted EBITDA. We expect to adjust for similar types of items in the future. Although we present selected items that we consider in evaluating our performance, you should be aware that the items presented do not represent all items that affect comparability between the periods presented. Variations in our operating results are also caused by changes in volumes, prices, mechanical interruptions and numerous other factors. We do not adjust for these types of variances. This measure may be used periodically by management when discussing our financial results with investors and analysts and is presented as management believes it provides additional information and metrics relative to the performance of our businesses. This non-gaap financial measure has important limitations as an analytical tool because it excludes some, but not all, items that affect the most directly comparable GAAP financial measures. You should not consider non-gaap measures in isolation or as substitutes for analysis of our results as reported under GAAP. Management compensates for the limitations of our non- GAAP measures as analytical tools by reviewing the comparable GAAP measures, understanding the differences between the non-gaap measure and the most comparable GAAP measure 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. Because all companies do not use identical calculations, our presentations of non-gaap measures may be different from similarly titled measures of other companies, thereby diminishing their utility. SemGroup does not provide guidance for net income, the GAAP financial measure most directly comparable to the non-gaap financial measure Adjusted EBITDA, because Net Income includes items such as unrealized gains or losses on derivative activities or similar items which, because of their nature, cannot be accurately forecasted. We do not expect that such amounts would be significant to Adjusted EBITDA as they are largely non-cash items. 2

3 Forward-Looking Information Investor Presentation - August 2017 Certain matters contained in this Press Release 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 and our current and expected dividends or to fund our other liquidity needs; any sustained reduction in demand for, or supply of, the petroleum products we gather, transport, process, market and store; the effect of our debt level on our future financial and operating flexibility, including our ability to obtain additional capital on terms that are favorable to us; our ability to access the debt and equity markets, which will depend on general market conditions and the credit ratings for our debt obligations and equity; the failure to realize the anticipated benefits of our acquisition of HFOTCO LLC, doing business as Houston Fuel Oil Terminal Company ( HFOTCO ); our ability to pay the second payment related to our HFOTCO acquisition and the consequences of our failing to do so; the loss of, or a material nonpayment or nonperformance by, any of our key customers; the amount of cash distributions, capital requirements and performance of our investments and joint ventures; the amount of collateral required to be posted from time to time in our commodity purchase, sale or derivative transactions; the impact of operational and developmental hazards and unforeseen interruptions; our ability to obtain new sources of supply of petroleum products; competition from other midstream energy companies; our ability to comply with the covenants contained in our credit agreements, continuing covenant agreement, and the indentures governing our notes, including requirements under our credit agreements to maintain certain financial ratios; our ability to renew or replace expiring storage, transportation and related contracts; the overall forward markets for crude oil, natural gas and natural gas liquids; the possibility that the construction or acquisition of new assets may not result in the corresponding anticipated revenue increases; any future impairment of goodwill resulting from the loss of customers or business; changes in currency exchange rates; weather and other natural phenomena, including climate conditions; a cyber attack involving our information systems and related infrastructure, or that of our business associates; 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; costs of, or changes in, laws and regulations and our failure to comply with new or existing laws or regulations, particularly with regard to taxes, safety and protection of the environment; the possibility that our hedging activities may result in losses or may have a negative impact on our financial results; general economic, market and business conditions; as well as other risk factors discussed from time to time in our 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 press release, 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. We use our 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 website at ir.semgroupcorp.com. We are present on Twitter and LinkedIn, follow us at the links below: SemGroup Twitter and LinkedIn 3

4 Delivering Long-Term Value Investor Presentation - August 2017 Transforming SemGroup from an upstream dependent company to a premier diversified energy infrastructure company Adding growth paths in exciting new areas: Gulf Coast Deep water access, pipeline connectivity and world class residual fuel oil terminal 24 crude pipeline connecting St. James to refineries that value crude optionality STACK Play Crude and gas pipelines, backed by investment-grade counterparties and driven by a robust production environment continuing to develop in the STACK Duvernay/Montney Leveraging SemCAMS' unique and valued high-sulphur gas processing footprint and pipeline transport capacity 4

5 Company Strengths Investor Presentation - August 2017 Stable Cash Flows Over 95% of gross margin is fee based Counterparty Strength (2) Over 70% of SemGroup's pro forma revenue is derived from investment grade counterparties 11% 51% 4% 41% 72% 38% 55% 28% 2016 Annualized 4Q 2017 (1) Take or Pay Fixed Fee Investment Grade Non-Investment Grade POP/Marketing HFOTCO increases SEMG's portion of cash flows with fixed-fee, contracted arrangements from credit-worthy counterparties (1) LTM December 31, 2016 (2) Counterparty ratings LTM December 31, 2016; excludes SemLogistics and SemMaterials Mexico 5 1) Annualized 4Q 2017 run rate, includes HFOTCO and Maurepas 2) LTM 6/30/17, pro forma HFOTCO acquisition; excludes SemLogistics and SemMaterials Mexico

6 Crude and Gas Assets in Key Growth Areas Crude Oil ~1,800 miles of crude oil pipelines 10 million barrels of crude oil storage capacity More than 230 crude oil trucks and trailers Maurepas Pipeline STACK Crude Omega Pipeline under construction (1) HFOTCO 16.8 mmbbls storage terminal, premier deepwater access One of the largest providers of residual fuel oil storage on the U.S.Gulf Coast Located in the leading refined products / oil storage and export marketplace Natural Gas 8 natural gas processing plants STACK SemGas Canton Pipeline under construction (1) New 200 mmcf/d Wapiti Gas Plant under construction (2) ~1,600 miles of natural gas gathering pipeline ~1.3 bcf/d of total processing capacity Additional Assets 8.7 million barrels, multi-product storage in U.K. 14 asphalt terminals in Mexico ~12% ownership in GP of NGL Energy Partners (3) Investor Presentation - August ) Expected completion late 4Q ) Expected completion 2Q ) Via Bayou Bridge and Ho-Ho, HFOTCO will be connected to St. James and ultimately will be connected to Maurepas

7 7 Crude Business

8 Crude Business Overview DJ Basin White Cliffs Pipeline - 51% ownership DJ Basin to Cushing, Oklahoma Two 527-mile, 12-inch pipelines 215,000 bpd current capacity Currently ships two crude types DJ Basin crude/condensate Kansas common Wattenberg Oil Trunkline 75-mile, 12-inch pipeline and storage in DJ Basin Transports Noble Energy production to White Cliffs 360,000 barrels of storage capacity 4-bay truck unloading facility at Briggsdale U.S. Gulf Coast Investor Presentation - August 2017 Maurepas Pipeline 24-inch, 34 mile crude oil pipeline connected to LOCAP at St. James and terminating at Norco refinery 12-inch, 35 mile intermediates pipeline between Convent and Norco refineries 6-inch, 35 mile intermediates pipeline between Norco and Convent refineries Platteville Truck Unloading Facility 30-lane truck unloading facility Origin of White Cliffs Pipeline 350,000 barrels of storage capacity 8

9 Investor Presentation - August 2017 White Cliffs Pipeline Contract & Rate Structure Committed Take or Pay Volumes Origination Volumes (bpd) Rate ($/bbl) Wtd. Avg. Remaining Contract Life (1) Platteville, CO 72,000 $5.20 ~ 2.6 years Healy, KS 5,000 $2.09 ~ 4.1 years 77,000 $5.00 (2) ~ 2.7 years Uncommitted Volumes (3) Volumes (bpd) Incentive Rate ($/bbl) 0 9,999 $ ,000 19,999 $ ,000 29,999 $ ,000 39,999 $ ,000 49,999 $ ,000 59,999 $ ,000 and up $3.00 Shipper Example - 1 Month 61,000 bpd shipped during the month, 10,000 of those barrels are committed volumes Below is an example the shipper s tariff structure Committed Volumes Uncommitted Volumes Total Volumes (bpd) Rate ($/bbl) 10,000 $ ,000 $3.00 (4) 61,000 $3.36 (2) All Uncommitted Volumes Shipped At Lowest Applicable Incentive Rate 9 1) Average remaining contract life as of 06/30/2017 2) Weighted average rate ($/bbl) 3) FERC Filing No , effective June 1, ) Shipper receives credit for the committed volumes towards their uncommitted volume incentive rate

10 Crude Business Overview Investor Presentation - August 2017 Oklahoma/Kansas Assets Cushing Storage 7.6 million barrels of storage ~82% under long-term fixed fee contracts with first expiration average storage rate of $0.33 per month Connectivity to all major inbound/outbound pipelines Kansas/Oklahoma System 460-mile gathering and transportation pipeline system Connects to third-party pipelines, Kansas and Oklahoma refineries and Cushing terminal More than 700,000 barrels of storage capacity Glass Mountain Pipeline 50% ownership 215-mile pipeline 140,000 bpd current capacity Two laterals Granite Wash and Mississippi Lime join and terminate in Cushing 1.5 million barrels of storage capacity STACK Crude pipeline extension - under construction (1) Isabel Pipeline 48 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 ~230 crude oil transport trucks Servicing the Bakken, DJ/Niobrara, Eagle Ford, Granite Wash & Mississippi Lime 10 1) Expected completion late 4Q 2017, see slide 26 for additional project information

11 Crude Key Performance Metrics Facilities - Cushing Storage 7.6 million Barrels Capacity Third-party contracted (1) Operational / Marketing Uncontracted 4.7 (Thousand Barrels per Day) Supply and Logistics Volumes Investor Presentation - August Q 2Q 3Q 4Q 1Q 2Q Transportation Volumes Joint Venture Transportation Volumes (3) (Thousand Barrels per Day) (Thousand Barrels per Day) Q 2Q 3Q 4Q 1Q 2Q Q 2Q 3Q 4Q 1Q 2Q Pipelines (2) Field Services White Cliffs Pipeline Glass Mountain Pipeline 11 1) Weighted average term of storage contracts 2) Volumes on 100% owned pipelines 3) Reflects 100% throughput on Joint Venture pipelines

12 12 HFOTCO

13 Investor Presentation - August 2017 Unique Position on the Houston Ship Channel Ship & Barge Docks Five ship docks which can receive up to Suez-max vessels with 45-foot draft (1) Seven barge docks (accommodating 23 barge simultaneously) Pipelines, Truck & Rail Three crude oil pipelines to four refineries (2) 72 rail spots 14 trucks spots Land 300 acres of waterfront land on the Houston Ship Channel 12 acres of undeveloped land at Moore Road Junction, hub for multiple pipelines Storage tanks 144 tanks ranging in size from 10 to 400 mbbls 16.8 mmbbls of storage capacity Additional 1.45 mmbbls currently under construction (expected completion mid-2018) 13 1) Fifth ship dock is currently under construction, expected completion mid ) HFOTCO owns two pipelines

14 with Strong Connectivity to the Houston Refinery Complex Investor Presentation - August 2017 Connects directly or indirectly to crude pipelines serving the Eagle Ford, Permian, Bakken, Midcontinent and Canada 14

15 Investor Presentation - August 2017 Diversified, Long-Term and Primarily Investment Grade Customers Approximately 88% of HFOTCO s 2016 revenue is generated by take-or-pay storage contracts The remaining 12% based on predictable streams related to ancillary services that derive from basic storage functions (heating, throughput fees, etc.) HFOTCO Customer Base Top 10 customers comprise ~61% of rental revenues No customer accounts for more than 10% of rental revenues Average customer tenure of ~15 years 48% of customers have been with HFOTCO for over 18 years Key Customers 75% of the contracted capacity is with diversified investment grade counterparties Non-rated / non-ig customers include several large global private companies 15

16 16 Natural Gas Business

17 SemGas Natural Gas Business Investor Presentation - August 2017 SemGas Areas of Operation N. Oklahoma Avg Processed Volume (mmcf/d) Q 2Q 3Q 4Q 1Q 2Q Capacity Processing Volumes Located in liquids rich oil plays Four processing facilities mmcf/d of current capacity ~1,000 miles of gathering lines STACK Canton Pipeline - under construction (1) 17 1) Expected completion late 4Q 2017, see slide 27 for additional project information

18 SemCAMS Natural Gas Business SemCAMS Areas of Operations Average Throughput Volume Investor Presentation - August 2017 (mmcf/d) (1) 1Q 2Q 3Q 4Q 1Q 2Q K3 Plant KA Plant Capacity (2) 600 miles of transport and gathering lines Strong incumbent position to serve industry s growing infrastructure needs Wapitit Sour Gas Plant - under construction (3) 18 1) Lower volumes related to an unplanned shutdown at our K3 plant during June ) Scheduled plant turnaround at K3 3) Expected completion 2Q 2019, see slide 28 for additional project information

19 19 Financials, Guidance & Capital Expenditures

20 Second Quarter 2017 Results Investor Presentation - August 2017 As Reported (in millions, excluding EPS, unaudited) 2Q Q 2017 Net income (loss) attributable to SemGroup $ 9.6 $ (10.3) Net income (loss) per share - diluted $ 0.15 $ (0.16) EBITDA (1) $ 52.3 $ 28.3 Selected Non-Cash Items and Other Items Impacting Comparability (1) $ 13.1 $ 32.4 Adjusted EBITDA (1) $ 65.4 $ 60.7 Dividend per Share $ 0.45 $ 0.45 Segment Adjusted EBITDA 2Q Q 2017 Crude - Transportation $ 25.2 $ 25.7 Crude - Facilities Crude - Supply and Logistics (3.5) (3.5) SemGas SemCAMS SemLogistics SemMaterials Mexico Corporate and Other (3.1) (5.0) $ 65.4 $ 60.7 SemCAMS - increased nearly $4 million due to take-or-pay true-ups, partially offset by lower capital fee revenue related to K3 plant turnaround SemGas - increased largely due to a $2.5 million one-time contractual true-up, partially offset by lower volumes Crude Supply & Logistics - results reflect continued pressure on marketing differentials SemLogistics - down approximately $1 million primarily due to lower throughput revenue 20 1) Non-GAAP Financial Data Reconciliations are included in the Appendix to this presentation

21 Leverage and Liquidity (in millions, unaudited) Standalone 6/30/2017 Adjustments Investor Presentation - August 2017 Pro Forma 6/30/2017 SemGroup (B2 / B+) (1) Revolving Credit Facility - $1.0 Billion due 2021 $ 164 $ 301 $ % Senior unsecured notes due % Senior unsecured notes due % Senior unsecured notes due Total SEMG Debt $ 1,239 $ 1,540 HFOTCO (Ba3 / BB-) (1) Revolving Credit Facility - $75 Million due 2019 Term Loan due 2021 $ 535 Hurricane Ike Bonds due Total HFOTCO Debt $ 760 Leverage Metrics SEMG Covenant Net Leverage Ratio (max 5.5x) (3) 3.7x 3.8x HFOTCO Covenant Net Leverage Ratio (max 7.5x) (4) 6.8x Consolidated Net Leverage Ratio 3.7x 5.2x (2) Liquidity SEMG Available Liquidity (5) $ 850 $ 549 HFOTCO Available Liquidity 79 Consolidated Available Liquidity $ 850 $ ) Corporate Family Rating 2) SemGroup completed the initial payment, which consisted of $301 million cash payment, funded from SEMG's revolving credit facility 3) Calculated per SEMG revolving credit agreement definitions, which includes material project adjustments ~$50 million and LTM Pro Forma HFOTCO distributions received ~$70 million 4) Calculated per HFOTCO revolving credit agreement definitions 5) Available liquidity excludes SemMaterials Mexico cash and is reduced for outstanding letters of credit

22 Updated 2017 Adjusted EBITDA Guidance Investor Presentation - August 2017 (in millions) Adjusted EBITDA $330 million - $350 million $400 $330 - $350 $300 $200 $270 - $290 $60 Crude Average Cushing storage rate: $0.33/barrel/month Maurepas Pipeline: completed Transportation volumes (3) : flat year over year White Cliffs Pipeline volumes: k bpd Glass Mountain Pipeline volumes: 75-80k bpd SemGas N. Oklahoma processing volumes: mmcf/d SemCAMS Processing volumes: mmcf/d K3 plant turnaround - completed 2Q 2017 $100 (1) (2) Initial 2017E (narrowed) HFOTCO 2017E Updated 2017E HFOTCO Acquisition effective July 17, 2017, includes ~$60 million of Adjusted EBITDA post-close Cash Taxes Approximately $5 million, related to foreign subs 22 1) 2017 Adjusted EBITDA guidance narrowed, primarily due to the continued softness in the crude supply & logistics markets and the timing of Maurepas cash flows 2) HFOTCO Adjusted EBITDA of $60 million reflects post-close contribution; $115 million full-year ) Transportation volumes excludes Maurepas Pipeline and JV assets (White Cliffs and Glass Mountain Pipeline)

23 Updated 2017 Capital Expenditure Guidance Investor Presentation - August 2017 $575 million Capex Spend on Strategic Crude and Natural Gas Projects $65 11% $75 13% Key Committed Projects $180 31% $185 32% Crude Projects Maurepas Pipeline ~ completed: $180 million Cushing 20" Pipeline ~ completion 4Q 2017: $35 million STACK Crude Omega Pipeline ~ completion late 4Q 2017: $30 million (1) $60 10% 11% Maurepas Pipeline Crude HFOTCO Natural Gas $10 2% Natural Gas Projects Wapiti Sour Gas Plant ~ completion 2Q 2019: $80 million KA Plant projects: $25 million N. Oklahoma gathering projects: $20 million STACK SemGas Canton Pipeline ~ completion late 4Q 2017: $60 million HFOTCO (2) Ship Dock #5: $35 million ~ completion mid mmbbls crude storage: $20 million ~ completion mid-2018 Other Growth Projects Maintenance 23 1) Reflects SemGroup's 50% of capital contributions to the joint venture 2) Reflects SemGroup's 2017 spend post-close of acquisition

24 Key Projects Update Investor Presentation - August 2017 Maurepas Pipeline ~ $500 million (1) Pipeline construction of all three pipelines is complete 24 crude pipeline is operational and cash flowing 6 and 12 product pipelines are complete and expected to begin contributing in September STACK Crude Omega Pipeline ~ $30 million (2) Right of way and surveys complete Tank construction at Omega and Ruby stations are progressing on schedule Expected completion late 4Q 2017 STACK SemGas Canton Pipeline ~ $60 million (1) Recently executed long-term gathering and processing contract with dedicated acreage in Blaine and Major counties Expected completion late 4Q 2017 Wapiti Gas Plant ~ $ million (1) Site work continues to progress Expected completion 2Q 2019 HFOTCO Projects ~ $120 million (3) Ship Dock #5 and 1.45 mmbbls crude storage Backstopped by long-term contract with credit worthy counterparty Expected completion mid ) Expected total project spend 2) Expected total project spend; reflects SemGroup's 50% of capital contributions to the joint venture 3) Expected total project spend; reflects SemGroup's total spend on HFOTCO projects

25 Investor Presentation - August 2017 Maurepas Pipeline Area Map Maurepas Pipeline Project Completed July

26 STACK Crude Omega Pipeline Investor Presentation - August 2017 Provides significant operational synergies by connecting to Glass Mountain Pipeline Omega Pipeline 44-mile pipeline extension of Glass Mountain Pipeline to STACK resource play to Cushing storage complex Backed by a long-term, fee-based transportation agreement with a large investment-grade producer includes committed area of dedication Provides cost-effective, reliable transportation to Cushing and access to Mid-Continent and Gulf Coast refineries Total project cost ~ $30 million (1) Project completion estimated late 4Q 2017 (1) Reflects SemGroup's 50% of capital contributions to the joint venture 26 1) Reflects SemGroup's 50% of capital contributions to the joint venture

27 STACK SemGas Canton Pipeline Provides significant operational synergies with our existing assets Investor Presentation - August 2017 Canton Pipeline 24-inch diameter natural gas pipeline, ~50 miles long Originates from SemGroup s Rose Valley gas processing facility in Woods County and extends to north central Blaine County Backed by a long-term, firm commitment from an investment-grade counterparty Additional long-term gathering and processing contract with dedicated acreage Initial capacity of 200 mmcf/d, and could be expanded up to 400 mmcf/d by adding compression, to serve other producers in the area Project completion estimated late 4Q 2017 Total project cost ~ $60 million 27

28 Investor Presentation - August 2017 Wapiti Sour Gas Plant in the Liquids-Rich Montney Play New 200 mmcf/d sour gas processing Wapiti plant will be integrated with our existing infrastructure to optimize & leverage current operations on the Wapiti Pipeline System and K3 plant located in the Kaybob region Supported by a 120 mmcf/d, 15 year contract with NuVista Total project cost ~ USD $225 - $250 million Plant completion estimated 2Q

29 HFOTCO Strategically Located Asset Investor Presentation - August 2017 HFOTCO is strategically situated on the Houston Ship Channel in close proximity to both supply sources (residual fuel oil from refineries and domestic crude oil production) and demand sources (area refineries and waterborne export) Houston Fuel Oil Terminal Co. Area Refineries 24 Crude Oil Pipeline (Owned by HFOTCO) 16 Crude Oil Pipeline (Owned by 3 rd Party) 24 to Speed (Owned by HFOTCO) 24 Valero Pipeline Proposed Pipeline Pipeline Interconnections 29

30 30 APPENDIX

31 Investor Presentation - August 2017 Consolidated Balance Sheets (in thousands, unaudited, condensed) June 30, 2017 December 31, 2016 ASSETS Current assets $ 543,126 $ 635,874 Property, plant and equipment, net 1,948,787 1,762,072 Goodwill and other intangible assets 180, ,208 Equity method investments 430, ,289 Other noncurrent assets, net 63,350 57,529 Total assets $ 3,166,218 $ 3,074,972 LIABILITIES AND OWNERS' EQUITY Current liabilities: Current portion of long-term debt $ 28 $ 26 Other current liabilities 455, ,329 Total current liabilities 455, ,355 Long-term debt, excluding current portion 1,215,244 1,050,918 Other noncurrent liabilities 90,101 89,734 Total liabilities 1,760,819 1,629,007 Total owners' equity 1,405,399 1,445,965 Total liabilities and owners' equity $ 3,166,218 $ 3,074,972 31

32 Investor Presentation - August 2017 Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands, except per share amounts, unaudited, condensed) Three Months Ended Six Months Ended June 30, March 31, June 30, Revenues $ 473,089 $ 287,377 $ 456,100 $ 929,189 $ 602,228 Expenses: Costs of products sold, exclusive of depreciation and amortization shown below 340, , , , ,789 Operating 73,346 54,707 52, , ,899 General and administrative 26,752 20,775 21,644 48,396 41,835 Depreciation and amortization 25,602 25,055 24,599 50,201 49,106 Loss (gain) on disposal or impairment, net (234) 1,685 2,410 2,176 14,992 Total expenses 465, , , , ,621 Earnings from equity method investments 17,753 17,078 17,091 34,844 40,149 Loss on issuance of common units by equity method investee (41) Operating income 25,269 25,391 23,457 48,726 57,715 Other expenses, net 12,033 9,944 33,639 45,672 68,566 Income (loss) from continuing operations before income taxes 13,236 15,447 (10,182) 3,054 (10,851) Income tax expense (benefit) 3,625 4, ,720 (16,749) Income (loss) from continuing operations 9,611 10,789 (10,277) (666) 5,898 Loss from discontinued operations, net of income taxes (2) (4) Net income (loss) 9,611 10,787 (10,277) (666) 5,894 Less: net income attributable to noncontrolling interests 1,922 10,942 Net income (loss) attributable to SemGroup Corporation 9,611 8,865 (10,277) (666) (5,048) Net income (loss) attributable to SemGroup Corporation 9,611 8,865 (10,277) (666) (5,048) Other comprehensive income, net of income taxes 8,952 6,591 6,033 14,985 2,482 Comprehensive income (loss) attributable to SemGroup Corporation $ 18,563 $ 15,456 $ (4,244) $ 14,319 $ (2,566) Net income (loss) per common share: Basic $ 0.15 $ 0.20 $ (0.16) $ (0.01) $ (0.11) Diluted $ 0.15 $ 0.19 $ (0.16) $ (0.01) $ (0.11) Weighted average shares (thousands): Basic 65,749 45,236 65,692 65,717 44,553 Diluted 66,277 45,647 65,692 65,717 44,553 32

33 Investor Presentation - August Quarterly Financial Data (in thousands, except per share data, unaudited) First Quarter Second Quarter Third Quarter Fourth Quarter Total revenues $ 314,851 $ 287,377 $ 327,764 $ 402,172 $ 1,332,164 Loss on disposal or impairment, net 13,307 1,685 1, ,048 Other operating costs and expenses 292, , , ,969 1,268,242 Total expenses 305, , , ,007 1,284,290 Earnings from equity method investments 23,071 17,078 15,845 17,763 73,757 Loss on issuance of common units by equity method investee (41) (41) Operating income 32,324 25,391 25,947 37, ,590 Other expenses, net 58,622 9,944 18,684 9,809 97,059 Income (loss) from continuing operations before income taxes (26,298) 15,447 7,263 28,119 24,531 Income tax expense (benefit) (21,407) 4,658 11,898 16,119 11,268 Income (loss) from continuing operations (4,891) 10,789 (4,635) 12,000 13,263 Income (loss) from discontinued operations, net of income taxes (2) (2) 3 (1) Net income (loss) (4,893) 10,787 (4,632) 12,000 13,262 Less: net income attributable to noncontrolling interests 9,020 1, ,167 Net income (loss) attributable to SemGroup $ (13,913) $ 8,865 $ (4,857) $ 12,000 $ 2,095 Earnings (loss) per share basic $ (0.32) $ 0.20 $ (0.09) $ 0.18 $ 0.04 Earnings (loss) per share diluted $ (0.32) $ 0.19 $ (0.09) $ 0.18 $ 0.04 Total Note: Prior quarter amounts above have been restated from the amounts originally reported to correct for an immaterial error identified by management in the fourth quarter related to an under capitalization of interest on certain capital projects. Previously reported interest expense, included in "other expense, net" above, has been decreased by $1.4 million, $0.9 million and $2.5 million for the quarters ended March 31, June 30 and September 30, 2016, respectively, with a corresponding increase to net income. Earnings per basic share was increased by $0.03, $0.02 and $0.05 per share for the quarters ended March 31, June 30 and September 30, 2016, respectively. Capitalized interest recorded for the fourth quarter of 2016 includes an immaterial out of period adjustment of $6.3 million related to under capitalization of interest in the prior year. 33

34 Investor Presentation - August 2017 Non-GAAP Adjusted EBITDA Calculation (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Reconciliation of net income to Adjusted EBITDA: Net income (loss) $ 9,611 $ 10,787 $ (10,277) $ (666) $ 5,894 Add: Interest expense 13,477 18,011 13,867 27,344 35,588 Add: Income tax expense (benefit) 3,625 4, ,720 (16,749) Add: Depreciation and amortization expense 25,602 25,055 24,599 50,201 49,106 EBITDA 52,315 58,511 28,284 80,599 73,839 Selected Non-Cash Items and Other Items Impacting Comparability 13,095 9,121 32,383 45,478 71,461 Adjusted EBITDA $ 65,410 $ 67,632 $ 60,667 $ 126,077 $ 145,300 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal or impairment, net $ (234) $ 1,685 $ 2,410 $ 2,176 $ 14,992 Loss from discontinued operations, net of income taxes 2 4 Foreign currency transaction loss (gain) (1,011) 1,543 (1,011) 3,012 Remove NGL equity earnings including loss on issuance of common units (6) (3) (9) (2,191) Remove loss (gain) on sale or impairment of NGL units (9,120) 30,644 NGL cash distribution 4,873 M&A transaction related costs 5,453 5,453 Employee severance and relocation expense ,095 Unrealized loss (gain) on derivative activities (928) 4, (901) (71) Depreciation and amortization included within equity earnings 6,698 7,138 6,712 13,410 13,677 Non-cash equity compensation 2,803 2,560 2,757 5,560 5,426 Loss on early extinguishment of debt 8 19,922 19,930 Selected Non-Cash items and Other Items Impacting Comparability $ 13,095 $ 9,121 $ 32,383 $ 45,478 $ 71, Note: 2Q 2017 cash expense: ~ $18 million interest, ~ $12 million maintenance capex, ~ $2 million income tax

35 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations Crude - Transportation Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income $ 13,520 $ 11,794 $ 12,242 $ 25,762 $ 31,089 Add: Interest expense (income) (1,470) 193 (1,305) (2,775) 457 Add: Depreciation and amortization expense 6,498 6,174 5,927 12,425 12,034 EBITDA 18,548 18,161 16,864 35,412 43,580 Selected Non-Cash Items and Other Items Impacting Comparability 6,683 8,954 8,788 15,471 15,560 Adjusted EBITDA $ 25,231 $ 27,115 $ 25,652 $ 50,883 $ 59,140 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal or impairment, net $ (15) $ 1,714 $ 1,961 $ 1,946 $ 1,781 Employee severance and relocation expense Depreciation and amortization included within equity earnings 6,698 7,138 6,712 13,410 13,677 Selected Non-Cash items and Other Items Impacting Comparability $ 6,683 $ 8,954 $ 8,788 $ 15,471 $ 15,560 35

36 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations Crude - Facilities Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income $ 6,690 $ 7,450 $ 6,884 $ 13,574 $ 15,155 Add: Interest expense Add: Depreciation and amortization expense 2,022 1,921 1,944 3,966 3,803 EBITDA 8,877 9,371 8,962 17,839 18,958 Selected Non-Cash Items and Other Items Impacting Comparability Adjusted EBITDA $ 8,877 $ 9,375 $ 9,016 $ 17,893 $ 18,962 Selected Non-Cash Items and Other Items Impacting Comparability Employee severance expense $ $ 4 $ 54 $ 54 $ 4 Selected Non-Cash items and Other Items Impacting Comparability $ $ 4 $ 54 $ 54 $ 4 36

37 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations Crude - Supply and Logistics Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income (loss) $ (2,941) $ 5,370 $ (3,961) $ (6,902) $ 18,831 Add: Interest expense Add: Depreciation and amortization expense EBITDA (2,536) 5,592 (3,642) (6,178) 19,233 Selected Non-Cash Items and Other Items Impacting Comparability (928) 4, (758) 156 Adjusted EBITDA $ (3,464) $ 10,069 $ (3,472) $ (6,936) $ 19,389 Selected Non-Cash Items and Other Items Impacting Comparability Loss on disposal or impairment, net $ $ $ $ $ 227 Employee severance expense Unrealized loss (gain) on derivative activities (928) 4, (901) (71) Selected Non-Cash items and Other Items Impacting Comparability $ (928) $ 4,477 $ 170 $ (758) $

38 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations SemGas Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income (loss) $ 4,459 $ (325) $ 3,673 $ 8,132 $ (13,799) Add: Interest expense 3,096 3,431 3,149 6,245 6,986 Add: Depreciation and amortization expense 9,099 9,198 8,927 18,026 18,125 EBITDA 16,654 12,304 15,749 32,403 11,312 Selected Non-Cash Items and Other Items Impacting Comparability ,647 Adjusted EBITDA $ 17,001 $ 12,560 $ 16,067 $ 33,068 $ 24,959 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal or impairment, net $ $ (1) $ 21 $ 21 $ 13,051 Employee severance expense Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ 347 $ 256 $ 318 $ 665 $ 13,647 38

39 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations SemCAMS Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income $ 6,652 $ 2,325 $ 3,506 $ 10,158 $ 5,601 Add: Interest expense 2,111 1,931 2,162 4,273 3,637 Add: Income tax expense 2, ,424 3,691 1,416 Add: Depreciation and amortization expense 4,434 4,294 4,496 8,930 8,245 EBITDA 15,464 9,001 11,588 27,052 18,899 Selected Non-Cash Items and Other Items Impacting Comparability , Adjusted EBITDA $ 15,893 $ 9,382 $ 12,520 $ 28,413 $ 19,663 Selected Non-Cash Items and Other Items Impacting Comparability Loss on disposal or impairment, net $ $ $ 445 $ 445 $ Foreign currency transaction loss (gain) (12) (1) 8 (4) 5 Employee severance 1 1 Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ 429 $ 381 $ 932 $ 1,361 $

40 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations SemLogistics Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income (loss) $ 1,040 $ (1,447) $ 1,285 $ 2,325 $ (1,693) Add: Interest expense , Add: Income tax expense (benefit) 372 (273) (214) Add: Depreciation and amortization expense 1,901 1,983 1,815 3,716 3,943 EBITDA 3, ,003 7,877 2,765 Selected Non-Cash Items and Other Items Impacting Comparability (772) 1,562 (64) (836) 2,249 Adjusted EBITDA $ 3,102 $ 2,178 $ 3,939 $ 7,041 $ 5,014 Selected Non-Cash Items and Other Items Impacting Comparability Foreign currency transaction (gain) loss $ (914) $ 1,391 $ (259) $ (1,173) $ 1,901 Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ (772) $ 1,562 $ (64) $ (836) $ 2,249 40

41 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations SemMaterials México Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net income $ 633 $ 1,187 $ 406 $ 1,039 $ 1,883 Add: Income tax expense Add: Depreciation and amortization expense 1, ,959 1,890 EBITDA 2,180 2,330 1,560 3,740 4,574 Selected Non-Cash Items and Other Items Impacting Comparability (281) Adjusted EBITDA $ 1,899 $ 2,574 $ 1,951 $ 3,850 $ 5,188 Selected Non-Cash Items and Other Items Impacting Comparability Gain on disposal of long-lived assets, net $ (211) $ (28) $ (17) $ (228) $ (67) Foreign currency transaction (gain) loss (84) Non-cash equity compensation Selected Non-Cash items and Other Items Impacting Comparability $ (281) $ 244 $ 391 $ 110 $

42 Investor Presentation - August 2017 Non-GAAP Financial Data Reconciliations Corporate & Other Segment (in thousands, unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, Net loss $ (25,339) $ (15,567) $ (34,312) $ (59,651) $ (51,173) Add: Interest expense 8,687 11,921 8,948 17,635 23,457 Add: Income tax expense (benefit) 5,358 4,286 (1,927) 3,431 (18,752) Add: Depreciation and amortization expense , EBITDA (10,746) 1,136 (26,800) (37,546) (45,482) Selected Non-Cash Items and Other Items Impacting Comparability 7,617 (6,757) 21,794 29,411 38,467 Adjusted EBITDA $ (3,129) $ (5,621) $ (5,006) $ (8,135) $ (7,015) Selected Non-Cash Items and Other Items Impacting Comparability Gain on disposal or impairment, net $ (8) $ $ $ (8) $ Loss from discontinued operations, net of income taxes 2 4 Foreign currency transaction (gain) loss (1) (1) (2) 697 Remove NGL equity earnings including loss on issuance of common units (6) (3) (9) (2,191) Remove loss on impairment or sale of NGL units (9,120) 30,644 NGL cash distribution 4,873 M&A transaction related costs 5,453 5,453 Employee severance and relocation expense Non-cash equity compensation 1,905 1,644 1,630 3,535 3,464 Loss on early extinguishment of debt 8 19,922 19,930 Selected Non-Cash items and Other Items Impacting Comparability $ 7,617 $ (6,757) $ 21,794 $ 29,411 $ 38,467 42

43 Reconciliation of Net Income to Adjusted EBITDA Investor Presentation - August 2017 (in thousands, unaudited) Crude - Transportation Crude - Facilities Three Months Ended September 30, 2016 Crude - Supply and Logistics SemCAMS SemLogistics SemMexico SemGas Corporate and Other Consolidated Net income (loss) $ 13,052 $ 7,697 $ (3,248) $ 5,080 $ 948 $ 1,491 $ 3,750 $ (33,402) $ (4,632) Add: Interest expense , ,367 12,136 18,517 Add: Income tax expense (benefit) 1,573 (601) ,577 11,898 Add: Depreciation and amortization expense 6,309 1, ,239 1, , ,922 EBITDA 19,515 9,679 (3,016) 13,067 2,683 2,815 16,196 (10,234) 50,705 Selected Non-Cash Items and Other Items Impacting Comparability 8, , ,078 20,588 Adjusted EBITDA $ 27,849 $ 9,681 $ 3,151 $ 13,191 $ 3,369 $ 2,887 $ 16,321 $ (5,156) $ 71,293 Selected Non-Cash Items and Other Items Impacting Comparability Loss (gain) on disposal of long-lived assets, net $ 1,018 $ $ $ $ $ $ $ $ 1,018 Foreign currency transaction (gain) loss (18) 659 Remove NGL equity losses including gain on issuance of common units Employee severance expense Unrealized loss on derivative activities 6,167 6,167 M&A transaction related costs 3,269 3,269 Depreciation and amortization included within equity earnings 7,283 7,283 Non-cash equity compensation ,291 1,620 Selected Non-Cash Items and Other Items Impacting Comparability $ 8,334 $ 2 $ 6,167 $ 124 $ 686 $ 72 $ 125 $ 5,078 $ 20,588 43