Rangeland Energy, LLC

Transcription

1 Rangeland Energy, LLC COLT (Crude Oil Loading Terminal) Introduction COQA Crude Oil Unit Train Operations October 27, 2011 Brian Freed Direct

2 Brian Freed Vice President of Business Development for Rangeland Energy since Jan 1, 2011 Director Energy Solutions International (ESI) Previously: CEO of ESI prior to selling to GFI/Oaktree Capital in September of 2010 Founder/CEO of Entessa from 2002 until merger with ESI in June 2010 Consultant with Perot Systems (now Dell) and Excelon Former Army Artillery Officer West Virginia University 2

3 Rangeland Energy, LLC Purpose Rangeland Energy, LLC is a midstream energy company focused on developing, acquiring, owning and operating midstream crude oil and natural gas assets. Formed in November, 2009, Rangeland Energy is funded by the EnCap Energy Infrastructure Fund, L.P. (EEIF), a private equity fund managed by EnCap Flatrock Midstream. Sr. Management team with over 100 years of midstream experience (crude oil, natural gas and refined products) Strategic Focus Initial focus is crude oil infrastructure in North Dakota s Bakken shale Williams & McKenzie Counties Target market includes refiners, producers, and marketers Rangeland is not an acquirer or marketer of crude oil (custody not title to the product) Other areas of interest: Niobrara Shale, Wyoming Eagle Ford Shale, Texas Crude oil rail unloading locations 3

4 Crude Oil Production 1.2 MMBD in 2015 Williston Production Growth 1,400,000 1,200,000 Historical Forecast Oil Production (Bbls/d) 1,000, , , , ,000 0 Current Base Production (Bbls/d) New Production BBls/d NDPA High Case Source:Raymond James, NDPA 4

5 Williston Basin Crude Oil Production and Export Capacity BPD 5

6 Bakken Crude Markets Where does the crude want to go? Currently supply push vs. market pull Average North Dakota wellhead price WTI minus creates LLS arbitrage opportunities As infrastructure develops, crude will seek the highest value market Gulf Coast St. James, Houston, Beaumont/Port Arthur, Lake Charles LLS market trades at a premium to WTI (historically between $2.00 $6.00/barrel) West Coast Anacortes, Bakersfield East Coast Albany and others to be announced Enhance crude value through blending Clearbrook ($3.50) Guernsey ($9.00) Trade Location (WTI Basis Diff) Cushing (WTI) $0.00 St. James $

7 COLT HUB & Connector Rangeland focus in Williams and McKenzie Counties COLT Hub located near Epping, ND - Aggregate crude oil to the COLT Hub - Provide rail, pipeline and truck market options - COLT Connector (21 miles of 10 pipeline) HESS HUB EOG Connector Williston 7

8 Manifest Rail Initial crude by rail take away method Less than 100 car trains with a mixture of car types and cargoes Cars are assembled into trains in yards which increases transit times as they will generally travel on 2 or more trains to the destination Slower loading (often directly truck to rail) Higher freight cost than unit trains Plentiful loading and unloading locations Neat barrels that are shipped maintaining the quality of the crude from dedicated trucks/tanks 8

9 Unit Train cars where the train stays together without being split up or stored enroot from origin to destination think 70,000 bbl batch Quicker transit times Engine stays with the train for loading must be loaded in 24 hours or less (approx. 14 hours at COLT) Load cars, pull train forward and repeat Lower freight rates Limited unloading locations currently available Neat barrels are shipped maintaining the quality of the crude from dedicated tanks 9

10 Rangeland s Development Project COLT 3 rd Party Pipelines Supply Hub Develop a crude oil HUB in Williams County, ND Merchant/3 rd party, fee for service facility Truck gathering services with both unloading and loading facilities Provide pipeline gathering services to the hub Provide terminal services (storage, blending, bad order repairs) at the hub Custody transfer measurement and sampling Dedicated tankage and fungible tankage options Railcar repair facilities on site Provide connectivity to multiple markets at the hub Pipeline (bi directional 10 to Ramberg/Beaver Lodge junction and other planned pipelines) & Railroad (unit train and manifest loading facilities) Maximize value of produced crude oil NGL and diesel storage and rail opportunities 10

11 COLT HUB Facility Rendering 3 rd Party Pipelines Supply Hub Rail Loading Tank Farm Scope of Facilities: (8) truck bays (4) 120 MB tanks (2) 8,600 ft unit train loops Pipeline connectivity Truck Station Pipeline 11

12 COLT Construction 12

13 COLT Construction 13

14 COLT Construction 14

15 COLT Construction 15

16 COLT Construction 16

17 COLT Connector Construction 17

18 Project Schedule Execute Land Purchase Options Award Bids & Purchase Materials Begin Construction (Terminal) Begin construction (Pipeline) In service 1Q2011 2Q2011 2Q2011 3Q2011 1Q

19 19 Questions?