Platts 8 th Annual Pipeline Development & Expansion Conference Gas-Electric Coordination Update Anders Johnson, Director System Design KinderMorgan Pipelines September 17, 2013 Hilton Houston Post Oak, Houston, Texas
Forward-Looking Statements This presentation contains forward-looking statements. These forward-looking statements are identified as any statement that does not relate strictly to historical or current facts. In particular, statements, express or implied, concerning future actions, conditions or events, future operating results or the ability to generate revenues, income or cash flow or to make distributions or pay dividends are forward-looking statements. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Future actions, conditions or events and future results of operations of Kinder Morgan Energy Partners, L.P., Kinder Morgan Management, LLC, El Paso Pipeline Partners, L.P., and Kinder Morgan, Inc. may differ materially from those expressed in these forward-looking statements. Many of the factors that will determine these results are beyond Kinder Morgan's ability to control or predict. These statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital and credit markets conditions; inflation rates; interest rates; the political and economic stability of oil producing nations; energy markets; weather conditions; environmental conditions; business and regulatory or legal decisions; the pace of deregulation of retail natural gas and electricity and certain agricultural products; the timing and success of business development efforts; terrorism; and other uncertainties. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Because of these uncertainties, you are cautioned not to put undue reliance on any forward-looking statement. Please read "Risk Factors" and "Information Regarding Forward-Looking Statements" in our most recent Annual Reports on Form 10-K and our subsequently filed Exchange Act reports, which are available through the SEC s EDGAR system at www.sec.gov and on our website at www.kindermorgan.com. 2
Gas-Electric Coordination Update KinderMorgan Gas Pipeline Overview FERC supported communication enhancements update Gas-Electric Coordination taking place today Gas Pipelines ability to serve (Midwest focus) Gas Pipeline Service Modifications 3
Natural Gas Pipelines Well-positioned connecting key natural gas resource plays with major demand centers Project Backlog: TGP Northeast upgrade LNG liquefaction (FTA @ Elba Island) Eagle Ford gathering & processing SNG / Elba Express expansions Sierrita lateral to Mexico border Long-term Growth Drivers: Natural gas the logical fuel of choice Cheap, abundant, domestic and clean Unparalleled natural gas network Sources natural gas from every important natural gas resource play in the U.S. Eagle Ford, Marcellus, Utica, Uinta, Haynesville, Fayetteville, Barnett, Mississippi Lime and Eaglebine Connected to every major demand center in the U.S. Demand growth and shifting supply from multiple basins Power / gas-fired generation Industrial and petrochemical demand Growth in Mexican natural gas demand Repurposing portions of existing footprint Greenfield development LNG exports Marcellus / Utica liquids solution Expand service offerings to customers 4
Communications Enhancements Federal Energy Regulatory Commission (FERC) issues notice of proposed rulemaking (NOPR) Communication of Operational Information Between Natural Gas Pipelines and Electric Transmission Operators Communications between the ISO/RTO are working at the real-time desk controller level Opportunity for long term outage planning Coordination Between Natural Gas and Electricity Markets, 141 FERC 61,125 (2012) (November 15 Order) Docket No. RM13 17 000 18 CFR Parts 38 and 284 http://www.gpo.gov/fdsys/pkg/fr-2012-12-13/pdf/2012-30063.pdf 5
NAESB Gas Nomination and Confirmation Cycles (CCT) Nomination Cycle Nomination Deadline for Shippers Point Operator Confirmation Deadline Receipt of Final Scheduled Quantities by Shippers & Point Operators Effective Flow Time Timely 11:30 AM 3:30 PM 4:30PM Evening 6:00 PM 9:00 PM 10:00 PM Intraday 1 10:00 AM 1:00 PM 2:00 PM Intraday 2 5:00 PM 8:00 PM 9:00 PM 9AM Next Gas Day 9:00 AM Next Gas Day 5:00 PM Same Gas Day 9:00 PM Same Gas Day 6
Pipelines Open to Gas Nomination and Confirmation Modifications* Nomination Cycle Nomination Deadline for Shippers Point Operator Confirmation Deadline Receipt of Final Scheduled Quantities by Shippers & Point Operators Effective Flow Time Timely 1:00 PM 3:30 PM 4:30PM Evening 6:00 PM 9:00 PM 10:00 PM Intraday 1 9:00 AM 12:00 PM 1:00 PM Intraday 2 4:00 PM 7:00 PM 8:00 PM Intraday 3 9:00 PM 12:00 AM 1:00 AM 6:00 AM Next Gas Day 6:00 AM Next Gas Day 1:00 PM Same Gas Day 8:00 PM Same Gas Day 1:00 AM Same Gas Day Central Time *Times for discussion 7
KM Gas Electric Update Scheduling Considerations Open to considering change to the gas day Open to considering change to current nomination cycles Open to considering a new standardized nomination cycle Support changes to the electric gas day and firm power definition Support infrastructure solutions along with scheduling modifications FERC Gas Electric Communication NOPR Support permissive communication with generators and RTOs Support sharing of long term infrastructure planning information 8
KinderMorgan Gas Pipelines http://www.kindermorgan.com/asset_map/km_natural_gas_system_map.pdf 9
Shale Supply and Pipeline Reversals Tennessee Gas Pipeline 2007 200 Line 2013 200 Line 300 Line Utica 300 Line Marcellus 100 Line 800 Line 500 Line Line Eagleford 100 Line 500 Line 800 Line 10
Pipeline Flow Reversal at a Compressor Station Electric motor driven compressor with reversible operation
Natural Gas Pipeline Company of America LLC (NGPL) Capability to Serve Incremental 5,000 + MW Power load 0.5 Bcf 116 ~1.4 Bcfd** ~7,000 MW 193 103 104 194 105 195 196 106 107 108 198 109 199 113 110 201 1 + Bcfd 206 310 309 311 1 + Bcfd ~1.6 Bcfd* ~8,000 MW 102 159 167 112 111 169 168 154 184 158 156 801 155 812 802 803 305 306 307 308 ~1.6 Bcfd** ~8,000 MW 139 388 304 LEGEND Storage Power Plant Pipeline Compressor Gas Receipt 300 341 301 303 343 342 346 HH For illustration purposes not to scale *NGPL can add ~2 Bcfd of system capacity by reversing existing pipelines ** Underutilized pipelines may be repurposed 12
NGPL Connected Power Plants 116 205 199 113 196 107 108 198 109 204 110 201 106 311 195 203 105 206 194 104 310 LEGEND 167 139 168 112 169 102 111 154 Storage Fields NGPL Pipeline NGPL Compression Existing Power Plant 193 103 159 158 184 156 801 155 301 300 812 803 802 388 304 303 302 343 305 342 306 346 309 308 307 Over 29 Direct and Indirect Power Plants connected Approx. 15,000 MW Small percentage hold firm transport to the plant Served by multiple parallel lines 341 13 For illustration purposes not to scale 13
Takeaways Transmission pipelines support FERC s call for open communication between Operators to improve reliability ISOs/RTOs/Pipelines are in active discussions to improve the energy grid reliability Pipelines stand ready to modify and/or construct facilities to meet contracted Power Plant demand for transport capacity Pipeline capacity is available today, is reliable, and more capacity can be made available by 2016 Pipelines are willing to shift the gas scheduling day to more closely align with the power day Pipelines will continue to offer services the market supports 14
Sources Layne Sanders, Manager Tennessee Gas Pipeline, Coordination with the NYISO and ISO-NE is excellent July 2013 Communication of Operational Information Between Natural Gas Pipelines and Electric Transmission Operators, RM13-17- 000; 7-18-2013 Notice of Proposed Rulemaking - 144 FERC P 61,043. Tennessee Gas Pipeline Customer Presentation 2013 http://tebb.elpaso.com/tgplookup/presentations/08191312-111713- 081913112518-2013%20Shipper%20Meeting%20Presentation.pdf. Miguel Garcia, KinderMorgan Investor & Public Relations, September 2013 KinderMorgan Website: http://www.kindermorgan.com/business/gas_pipelines/, September 2013 15