Jim Cleary President, El Paso Western Pipelines. Platts Conference, Rockies Gas & Oil April 25, 2008

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1 Jim Cleary President, El Paso Western Pipelines Platts Conference, Rockies Gas & Oil April 25, 2008

2 Cautionary Statement Regarding Forward-looking Statements This presentation includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of The company has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this presentation, including, without limitation, our ability to successfully contract, build and operate the pipeline projects described in this presentation; changes in supply of natural gas; general economic and weather conditions in geographic regions or markets served by El Paso Corporation and its affiliates, or where operations of the company and its affiliates are located; the uncertainties associated with governmental regulation; competition, and other factors described in the company s (and its affiliates ) Securities and Exchange Commission filings. While the company makes these statements and projections in good faith, neither the company nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. The company assumes no obligation to publicly update or revise any forwardlooking statements made herein or any other forward-looking statements made by the company, whether as a result of new information, future events, or otherwise. 2

3 Outline Why Ruby? Why Now? Progress Update Conclusion 3

4 El Paso Western Pipelines Big Horn Wind River Green River Powder River Denver-Julesburg Uinta Piceance Raton Anadarko San Juan WIC CIG EPNG Mojave Cheyenne Plains Permian Note: Includes El Paso Corporation and El Paso Pipeline Partners, L.P. 4

5 Malin Ruby Pipeline Map PG&E GTN O R E G O N Fremont- Wenima National Forest I D A H O 680 miles of 42-inch Opal to Malin 1.2 Bcf/d expandable to 2.0 Bcf/d 1,440 psig MAOP Compression: Head Station (76,500 hp) & Mid Point (30,000 hp) (possibly 3 rd location) Measurement 9 Locations 64% +/- Public Land 2 National Forests: Cache and Fremont-Winema 5 BLM Offices Mostly Remote / Unpopulated W Y O M I N G C A L I F. Tuscarora Paiute RUBY N E V A D A Cache National Forest U T A H Opal Hub WIC CIG Cheyenne Plains Kern River C O L O R A D O 5

6 Why Ruby? 6

7 Bcf/d Rockies versus Western Canada Long-Term Production Trends Canadian Peak Peak - 17 Bcfd El Paso High Case Best fit of Current Trend: Peak - 15 Bcfd Production El Paso Base Case Best Fit Curves Assumes: - Gaussian Curve -340 EUR - Few environmental constraints Forecast

8 Ziff Forecasted Canadian Exports Source: Ziff Energy 8

9 Historical and Forecasted Gas Demand (Northern CA and the Pacific Northwest) MMcf/d 3,000 2,500 2,000 1,500 PG&E Planning Area *Source: California Energy Commission California Energy Demand (Staff Revised Forecast Nov. 2007) Forecast: ( ) CAGR =.39% Growth Volume = 42 MMcf/d 1, Pacific Northwest *Source: EL Paso Macro Model (Oregon & Washington) Forecast: ( ) CAGR = 2.24% Growth Volume = 195 MMcf/d

10 Northern/Central California Market Detail The northern/central California market is served by PG&E PG&E system is supplied from Canada and US (Rockies, San Juan and Permian Basins) Reduced imports have resulted in PG&E Lines 400/401 (north to south flow) being underutilized Current California pipeline infrastructure allows for limited gas deliveries from southern to northern California SoCal system has limited physical ability to flow LNG from Mexico or Southern California into PG&E 2.0 Bcf/d San Francisco s s s s s GTN OREGON Malin PG&E Line 400 /401 Sacramento Tuscarora NEVADA CALIFORNIA Los Angeles North to South flow utilization typically below 70% due to reduced Canadian imports Kern 1.1 Bcf/d PG&E Line 300 SoCal SDG&E San Diego ARIZONA Topock Blythe North Baja Baja Norte Costa Azul LNG 10

11 Why Now? 11

12 Rocky Mountain Production (Volumes are Wellhead Measured in MMcfd) 14,000 12,000 Big Horn Green River Wind River Overthrust Forecast 10,000 Powder River Piceance Uinta Denver 3.28 Bcf/d of growth ,000 6,000 4,000 2,000 Forecast by 2016: High Case 13,278 Mid Case 11,860 Low Case 10, : Wellhead total data from IHS database : El Paso forecast 12

13 Jan 1995 Feb 2008 Cheyenne Basis to Henry Hub vs. Export Load Factors Dollars per MMBtu Historical Relationship Load Factor ~84% HH Hub Basis ~ $ % 65.0% 70.0% 75.0% 80.0% 85.0% 90.0% 95.0% 100.0% 13

14 Rockies Gas Balance Annual Average Wellhead Production Forecast (MMcf/d) Dry Production 6,325 6,694 7,288 7,875 8,324 8,683 8,979 9,232 9,451 9,641 9,807 Local Consumption* 1,591 1,637 1,613 1,695 1,625 1,637 1,652 1,657 1,690 1,721 1,750 Available for Export 4,734 5,057 5,675 6,180 6,699 7,046 7,328 7,575 7,760 7,920 8,057 Total Export Capacity 5,397 6,030 6,200 6,200 8,070 8,070 8,070 9,270 9,270 9,270 9,270 Capacity Surplus ,371 1, ,695 1,510 1,350 1,213 % Surplus Capacity 12.3% 16.1% 8.5% 0.3% 17.0% 12.7% 9.2% 18.3% 16.3% 14.6% 13.1% - Expansions (Includes Ruby) Need for Additional Export Capacity Possible Need for Another Expansion by *Source El Paso supply Forecast 14

15 10,000 MMcf/d 9,000 8,000 Cheyenne Plains 560 expansion Cheyenne Plains 170 expansion REX West 1800 expansion Rockies Supply vs. Regional Export Capacity Ruby 1200 expansion 100% LF High Case 7,000 6,000 85% LF Expansion needed: Base Case 5,000 4,000 3,000 Supply Available for Export Base Case if 85% LF if 85% LF 2, *Source El Paso supply Forecast 15

16 Project Progress 16

17 Development In development for over a year Analyzed 3 major routes & 4 variations of the preferred route Route selected after extensive agency/stakeholder discussions BLM application filed: November 2007 Precedent agreement (PA) signed with PG&E (anchor shipper) and two others for 650 Mdth/d: December 2007 CPUC filing for approval of PG&E PA: December 2007 FERC Pre-filing process began: January 2008 Binding Open Season began: February

18 Boots On the Ground Centerline and detailed surveys underway Survey permission received from Land-owners and the BLM for 75% of the route 25% of ROW is already surveyed 10 Open Houses covering the entire route from Opal, Wyoming to Malin, Oregon 6 Scoping meetings with BLM 18

19 Looking Forward CPUC Ruling Expected: October 2008 FERC Filing: January 2009 In Service Target: March

20 Conclusion Canadian export decline suggests the Western Markets require supply diversity Rockies Supply push requires additional infrastructure in the next few years Considerable progress has already been made on Ruby Pipeline development Ruby is the project that can meet the market s timeline and needs 20

Ruby Pipeline Project

Ruby Pipeline Project Ed Miller Ruby Project Manager October 21, 2008 El Paso Pipeline System Ruby Pipeline CIG & WIC Tennessee Gas Pipeline Mojave Pipeline El Paso Natural Gas Cheyenne Plains Pipeline