National Fuel Gas Supply Corporation & Empire Pipeline. Marcellus Driven Infrastructure Projects

Transcription

1 National Fuel Gas Supply Corporation & Empire Pipeline Marcellus Driven Infrastructure Projects Greg Maliken Sr. Manager - Facility Planning Interstate Marketing Department

2 Safe Harbor for Forward Looking Statements This presentation may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, including statements regarding future prospects, plans, performance and capital structure, anticipated capital expenditures and completion of construction projects, as well as statements that are identified by the use of the words anticipates, estimates, expects, forecasts, intends, plans, predicts, projects, believes, seeks, will, may, and similar expressions. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from results referred to in the forwardlooking statements: changes in economic conditions, including economic disruptions caused by terrorist activities, acts of war or major accidents, and downturns in economic activity including national or regional recessions; changes in demographic patterns and weather conditions, including the occurrence of severe weather such as hurricanes; changes in the availability and/or price of natural gas or oil and the effect of such changes on the accounting treatment of derivative financial instruments or the valuation of the Company s natural gas and oil reserves; uncertainty of oil and gas reserve estimates; ability to successfully identify, drill for and produce economically viable natural gas and oil reserves, including shortages, delays or unavailability of equipment and services required in drilling operations; significant changes from expectations in the Company s actual production levels for natural gas or oil; changes in the availability and/or price of derivative financial instruments; changes in the price differentials between various types of oil; inability to obtain new customers or retain existing ones; significant changes in competitive factors affecting the Company; changes in laws and regulations to which the Company is subject, including changes in tax, environmental, safety and employment laws and regulations; governmental/regulatory actions, initiatives and proceedings, including those involving acquisitions, financings, rate cases (which address, among other things, allowed rates of return, rate design and retained gas), affiliate relationships, industry structure, franchise renewal, and environmental/safety requirements; unanticipated impacts of restructuring initiatives in the natural gas and electric industries; significant changes from expectations in actual capital expenditures and operating expenses and unanticipated project delays or changes in project costs or plans; the nature and projected profitability of pending and potential projects and other investments, and the ability to obtain necessary governmental approvals and permits; occurrences affecting the Company s ability to obtain funds from operations, from borrowings under our credit lines or other credit facilities or from issuances of other shortterm notes or debt or equity securities to finance needed capital expenditures and other investments, including any downgrades in the Company s credit ratings; ability to successfully identify and finance acquisitions or other investments and ability to operate and integrate existing and any subsequently acquired business or properties; impairments under the SEC s full cost ceiling test for natural gas and oil reserves; changes in the market price of timber and the impact such changes might have on the types and quantity of timber harvested by the Company; significant changes in tax rates or policies or in rates of inflation or interest; significant changes in the Company s relationship with its employees or contractors and the potential adverse effects if labor disputes, grievances or shortages were to occur; changes in accounting principles or the application of such principles to the Company; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; changes in actuarial assumptions and the return on assets with respect to the Company s retirement plan and post-retirement benefit plans; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide post-retirement benefits; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. For a discussion of these risks and other factors that could cause actual results to differ materially from results referred to in the forward-looking statements, see Risk Factors in the Company s Form 10-K for the fiscal year ended September 30, 2010 and the Company s Form 10-Q for the quarter ended March 31, The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

3 National Fuel Gas Company Principal Businesses National Fuel Gas Company E&P Midstream P&S Utility Energy Mktg Seneca Resources Corporation National Fuel Gas Midstream Corporation National Fuel Gas Supply Corporation & Empire Pipeline National Fuel Gas Distribution Corporation National Fuel Resources, Inc.

4 PL&S: ~3,000 miles of pipe, 60,000+ hp LDC: ~725,000 Customers Served throughout Western NY and Northwestern PA

5 Own/Operate 27 Fields; Co-Own/Operate 4 Fields Storage Capacity ~78 bcf

6 Pre-Marcellus Gas Supply Sources in North America

7 Pre-Marcellus Gas Supply Sources to the Northeast ONTARIO NIAGARA New York LEIDY Pennsylvania

8 Post-Marcellus Gas Supply Sources in North America Rockies Appalachia MidCon Southeast/ Gulf

9 Post-Marcellus Gas Supply Sources to the Northeast ONTARIO NIAGARA New York LEIDY Pennsylvania

10 NFGSC System Increased Producer Activity IC Requests % increase in IC requests from 2009 to 2010

11 MCFD NFGSC System Increased Producer Activity 1,800,000 Cumulative Requested Volumes 1,600,000 1,400,000 1,200,000 1,000, , , , ,000 0 Producer Requested Flow Date

12 National Fuel System New York Utility Service Territory Erie Right in the heart of it... Marcellus Shale Pennsylvania

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14 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

15 PIPELINE & STORAGE EXPANSION INITIATIVES Capacity Facilities Cost Northern Y-M53 Access TO Expansion LEIDY 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM Anticipated Revenue Market (Dth/d) $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

16 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

17 PIPELINE & STORAGE EXPANSION INITIATIVES NORTHERN ACCESS EXPANSION Northern Access Expansion Capacity Facilities Cost Anticipated Revenue Market (Dth/d) 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

18 National Fuel Gas Supply Corporation Northern Access Highlights C C Compression at Ellisburg and East Aurora (~14,210 Hp) Modification to Lockport & Concord Compressor Stations and Niagara Measurement Capacity: 320,000 Dth/d; subscribed by Statoil Filed 7(c) March 2011 Expected in-service date of November 2012

19 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

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23 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

24 PIPELINE & STORAGE EXPANSION INITIATIVES LAMONT COMPRESSION Northern Access Expansion Capacity Facilities Cost Anticipated Revenue Market (Dth/d) 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

25 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

26 PIPELINE & STORAGE EXPANSION INITIATIVES Northern Access Expansion LINE N EXPANSIONS Capacity Facilities Cost Anticipated Revenue Market (Dth/d) 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

27 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

28 PIPELINE & STORAGE EXPANSION INITIATIVES MERCER COMPRESSION Capacity Facilities Cost Northern Access Expansion 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM Anticipated Revenue Market (Dth/d) $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

29 NFG Supply Corp. / Empire Pipeline, Inc. Proposed Marcellus to Markets Projects Y-M53 to Leidy Northern Access Expansion Tioga County Extension Central Tioga County Project Lamont Compressor Station Line N Expansion Line N 2012 Expansion Mercer Compression Project West to East Project

30 PIPELINE & STORAGE EXPANSION INITIATIVES Northern Access Expansion WEST TO EAST Capacity Facilities Cost Anticipated Revenue Market (Dth/d) 320,000 Dth/d 9,470 Hp Ellisburg 4,740 Hp East Aurora Concord and Lockport $61.5 MM $13.6 MM PA Statoil 320,000, 20 yrs FERC Filing March 2011 Anticipated In-Service November 2012

31 National Fuel Gas Supply Corporation West to East Highlights 82 miles of 24, portions paralleling existing line FM ,000 Hp at two new compressor stations Capacity: 425,000+ Dth/d; NEPA Pre-Filing Process commenced March c Filing expected 2012 Engineering and environmental studies well underway Expected in-service late 2013 / 2014

32 MCFD MCFD 1,600, ,000 1,400, , , ,000 1,200, , ,000 1,000, , ,000 Marcellus Production on National Fuel ActualTransported Marcellus Production Volumes Actual Transported Marcellus Production Volumes Marcellus Production on National Fuel Estimated Marcellus Volumes from System Expansions (80% Load Factor) Estimated Marcellus Volumes from System Expansions (80% Load Factor) West to East West to East (Full Ramp Up) Central Tioga County Project / West to East 710, , , , , , , , , , ,000 Line N 2012 Expansion / Northern Access Line 540,000 N 2012 Expansion / Northern Access 250, , , , ,000 50, Lamont HP 2010 & 2011 Line N Expansion Line N 2011 / Tioga County Expansion 128,000

33 National Fuel Gas Supply Corporation Marcellus-Driven Expansion Projects Project ISD Capacity (Dth/d) Notes YM-53 to Leidy Feb ,000 Partial Subscribed Northern Access Nov ,000 Fully Subscribed Tioga County Extension Fall ,000 Fully Subscribed Central Tioga County Project Fall ,000 Developing Design Lamont Phase I Jul ,000 Fully Subscribed Lamont Phase II Jun ,000 Fully Subscribed Line N 2011 Sept ,000 Fully Subscribed Line N 2012 Nov ,000 Fully Subscribed Mercer Compression Late 2012/2013 TBD Finalize Open Season West to East Late ,000 Partial Subscription Total Firm Capacity > 1,855,000 Dth/d Capital Investment ~ $585 Million

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35 Questions?

36 Thank you Supply Empire links Project Presentations