Exhibit 99.1 NUSTAR ANALYST DAY New Orleans and St. James, LA September 21, 2011 |
Statements contained in this presentation that state management’s expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words “believe,” “expect,” “should,” “targeting,” “estimates,” and other similar expressions identify forward-looking statements. It is important to note that actual results could differ materially from those projected in such forward-looking statements. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations. For more information concerning factors that could cause actual results to differ from those expressed or forecasted, see NuStar Energy L.P.’s annual report on Form 10-K and quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission and available on NuStar’s website at www.nustarenergy.com. 2 Forward Looking Statements |
Agenda NuStar Overview (15 minutes) Curt Anastasio 4 Storage Segment Overview (20 minutes) Danny Oliver 11 Transportation Segment Overview (20 minutes) Danny Oliver 20 Asphalt & Fuels Marketing Overview Paul Brattlof 31 (15 Minutes) St. James Terminal Overview (15 minutes) Kyle Oppliger 38 Closing Remarks and Q&A Curt Anastasio 52 3 Topic Presenter* Page # * Bios of management team can be found in the appendix starting on page 53 |
NuStar Overview NuStar Overview Curt Anastasio Curt Anastasio CEO & President CEO & President 4 |
Spent $136 million on internal growth projects Majority of this spending relates to projects that will begin generating EBITDA in the last half of 2011 Completed six projects with a total spend of $28 million and a projected EBITDA multiple of 4x to 6x Spent another $100 million on acquisitions that should yield annual EBITDA of around $20 million Earned $253 million in EBITDA Record June year to date EBITDA Increased NS and NSH distributions in 2nd quarter NS distributions increased to $1.095 per unit, 2% higher than 1Q 2011 and 3% higher than 2Q 2010 NSH distributions increased to $0.495 per unit, 3% higher than 1Q 2011 and 8% higher than 2Q 2010 45 June 2011 Year to Date NuStar Energy Highlights Continued to maintain an outstanding safety and environmental record superior to our industry peers Obtained VPP Star Site status at four locations with the goal being the entire company |
EBITDA ($ in Millions) 6 Continued weak economic conditions causing results in our asphalt operations to be lower than expected in the last half of the year Lower pipeline throughputs expected to cause our transportation segment results to be lower than 2010 2011 EBITDA expected to be comparable to 2010 2002 2003 2004 2005 2006 2007 2008 2009 2010 $77 $112 $133 $219 $322 $353 $492 $461 $483 |
While distribution growth at NS and NSH has slowed in the past couple of years…internal growth projects expected to lead to higher distribution growth levels over the next several years NS Distribution ($ per Unit) NSH Distribution ($ per Unit) ~6.6% CAGR ~9.9% CAGR * Annualized Distribution 7 |
$20 $13 $55 $107 $159 $205 $14 $20 $30 $23 $27 $45 $43 $100 2009 Actual 2010 Actual 2011 Forecast Acquisitions Corporate Asphalt & Fuels Marketing Storage Transportation 2011 Total Spending on Internal Growth Projects & Acquisitions currently projected to be around $435 million ( Dollars in Millions) $164 $262 $435 8 |
Safety and Environmental performance in 2011 continues to exceed Industry Benchmarks NuStar Injury Incident Frequency Rates *Through August 2011 9 * NuStar 2011 Safety and Environmental Awards Industry Benchmarks Independent Liquid Terminals Association Safety Excellence Award Perfect Record Award - National Safety Council Million Hours Award - National Safety Council Safety Leadership Award - National Safety Council Occupational Excellence Award- National Safety Council 2006 2007 2008 2009 Refineries 1.4 1.6 1.1 1.0 Pipelines 2.2 2.0 1.6 1.9 Terminals 5.6 5.8 6.4 4.6 2006 2007 2008 2009 Refineries 0.5 0.3 0.2 0.3 Pipelines 0.6 0.5 0.5 0.5 Terminals 1.1 1.7 1.8 1.2 TRIR LTIR TRIR – Total Recordable Incidents Rate LTIR – Lost Time Incidents Rate 1.49 1.36 0.76 0.31 0.69 0.27 0.14 0.19 0.15 0.00 0.15 0.00 2006 2007 2008 2009 2010 2011 TRIR LTIR |
Continued development of our strategically located storage terminals Primarily Texas City, St. James, St. Eustatius and New York Harbor Eagle Ford and Other Shale plays Expansion of bunker marketing, fuel oil marketing and crude oil trading in certain areas Feedstock cost and logistics optimization at our Asphalt and Fuels refineries Acquisition opportunities in strategic domestic and international locations 9 Key Growth Areas and Focus 10 |
Storage Segment Overview Storage Segment Overview Danny Oliver Danny Oliver Senior VP – Senior VP – Business & Corporate Business & Corporate Development Development 11 |
2011 Storage Segment results should be improved over 2010…. Internal Growth projects continue to drive increases in EBITDA Storage Segment EBITDA (in Millions) 2011 Summary Full year of EBITDA should be realized from May 2010 Mobile, AL terminal acquisition and St. Eustatius terminal project completed in the 4th quarter of 2010 Benefits from St. James Phase I storage project began July 1 and will continue to be phased in during the 3rd quarter as a portion of the planned tanks are completed 2011 segment EBITDA expected to be $20 to $30 million higher than 2010 12 2006 2007 2008 2009 2010 $162 $177 $208 $242 $256 |
< 1 Year 1 to 3 Years 3 to 5 Years > 5 Years 28% 39% 21% 12% Demand for storage continues to be strong at NuStar terminal locations Storage Contract Renewals (% of Revenues) Approximately 95% of our tankage is currently leased NuStar continues to enter into storage agreements with large credit worthy customers Current customers and potential new customers continue to approach us about constructing new tankage at several of our terminal locations Looking at terminal acquisition opportunities in domestic and international markets that are of interest to our customer base 13 |
2012 Storage Segment Internal Growth spending should be higher than 2011 levels (Dollars in Millions) Identified Storage Projects >$10 Million: 14 $340 $0 $50 $100 $150 $200 $250 $300 $350 2008 2009 2010 2011 Forecast 2012 Forecast $128 $107 $159 $205 $120 $220 Projects being evaluated Identified Projects St. James Storage Tank Expansion-Phase 1 $89 $4 $130 St. James Storage Tank Expansion-Phase 2 $0 $35 $123 St. Eustatius Tank Expansion $23 $29 $53 Linden NuTop Tank Expansion $7 $31 $61 St. James Unit Train Project $27 $8 $30 EBITDA multiples on these projects should range from 4x to 8x 2011 2012 CAPEX CAPEX Total |
Phase I Completed in 3 rd quarter 2011 3.2 million barrels of crude oil storage for trading companies Total cost around $130 million Phase II Should be similar in size and cost to Phase I Most of tankage should be crude storage Expect tanks to be in-service late 2012 or early 2013 Phase I of St. James, Louisiana terminal expansion recently completed..Phase II in early planning stages 15 |
Constructing one million barrels of new storage for distillate service Customer is a large national oil company Projected CAPEX around $50 million Expected in-service 4th quarter 2012 Currently evaluating a major expansion project at the St. Eustatius terminal In the process of constructing new tanks for distillate service at our St. Eustatius terminal 16 |
Continued demand for bulk storage in New York Harbor justifies the conversion of the terminal from a rack marketing terminal to a bulk storage facility Plan to construct ~850,000 barrels of new storage Should increase terminal capacity to 1.2 million barrels Projected CAPEX around $60 million Expected in-service 3rd quarter 2013 Linden NuStar terminal expansion project expected to begin in the next few months 17 |
Entered into an agreement with two subsidiaries of EOG Resources, Inc. EOG is a large independent oil and natural gas company Proved reserves in the United States, Canada, the UK and China Project description: New rail and unit train offloading facilities jointly developed by NuStar and two EOG Resources, Inc. subsidiaries Facility will be equipped to handle at least one 70,000-barrel train per day Two new storage tanks with a combined capacity of 360,000 barrels Costs and completion dates: Project expected to be completed and in service early 3rd quarter 2012 NuStar’s share of the costs should be approximately $30 million Have begun the construction of a unit train offloading facility at our St. James terminal 18 |
Chickasaw, AL terminal pipeline connection Connection to 3 party crude oil pipeline South Texas Valley System Ethanol Convert Edinburg and Harlingen Terminals to ethanol blending Stockton, CA diesel rail loading Gives customers the ability to load CARB diesel on rail cars Linden Fuel Oil Conversion (Joint Venture Terminal) Convert one 320,000 barrel tank currently in fuel oil service to clean light products service Total spending for these projects should be around $20 million Several projects with capital spending of less than $10 million per project…were completed in 2011 or should be completed by end of 2011 19 rd |
Transportation Segment Overview Transportation Segment Overview Danny Oliver Danny Oliver Senior VP – Senior VP – Business & Corporate Business & Corporate Development Development 20 |
2011 EBITDA expected to be down due primarily to lower throughputs Transportation Segment EBITDA (in Millions) 2011 Summary Eagle Ford shale crude project with Koch Pipeline Company completed in June 2011. Throughput and deficiency agreement for 30,000 BPD Throughputs projected to be down 7% to 8%. Heavy customer refinery turnaround schedule and increased export demand for distillates could negatively impact throughputs on NuStar’s Corpus to Houston refined products pipeline Full year 2011 segment EBITDA expected to be $5 to $15 million lower than 2010 21 2006 2007 2008 2009 2010 $170 $176 $186 $190 $199 |
Shale oil Is expected to provide growth opportunities in the Transportation Segment Shale Oil Growth/Technology Key shale oil developments are located in NuStar’s Mid-Continent and Gulf Coast regions, including the Eagle Ford, Bakken, Granite Wash, Barnett, Mississippian and Niobrara NuStar’s assets are well positioned to capitalize on the expanding unconventional oil & gas developments A key strategic objective is to grow earnings from fee-based logistics services Redeploying existing and/or build new pipelines and terminals in the shale oil regions Diversifying customer base and expanding logistics services for crude oil, condensate and NGLs through asset modifications, expansions and strategic acquisitions 22 |
(Dollars in Millions) 23 Expect to spend a record amount of Internal Growth capital in Transportation Segment in both 2011 and 2012 Transportation Projects >$10 Million: 2011 2012 CAPEX CAPEX Total Three Rivers Crude Supply for Valero $15 $43 $58 Oakville Storage and 16” Crude Pipeline Reversal $17 $30 $47 North Beach Crude Loading $5 $8 $13 San Antonio Refinery Crude Pipeline $16 $5 $21 San Antonio Product Supply Expansion $2 $11 $13 EBITDA multiples on these projects should range from 4x to 8x |
NuStar plans to modify existing pipeline assets and construct new pipeline assets for Valero in Eagle Ford Shale Plans call for reversal of an existing 8-inch refined products pipeline Line moved products from Corpus Christi to Three Rivers Plan to place in crude oil service after reversal Projected CAPEX less than $5 million Placed in service September 15, 2011 NuStar also plans to build 55 miles of new 12-inch pipeline that will connect to existing NuStar pipeline segments Expect to move crude and condensate from Corpus Christi to Valero’s Three Rivers refinery Projected CAPEX close to $60 million Should be in service by the 2nd quarter of 2012 24 |
New NuStar Pipeline Existing NuStar Pipeline NuStar plans to modify existing pipeline assets and construct new pipeline assets for Valero in Eagle Ford Shale Valero West Plant CORPUS CHRISTI THREE RIVERS REFINERY 8” line 12” line 25 |
Plan to develop a new pipeline system in the Eagle Ford Shale as a result of Letters of Intent entered into in the 2nd Quarter of 2011 In the 2nd quarter of 2011, announced the signing of LOIs with TexStar Midstream Services and Velocity Midstream Partners to develop a new pipeline system TexStar and Velocity both plan to construct pipelines that transport crude and condensate to Three Rivers, TX Pipelines should be interconnected with a new storage facility to be constructed at Three Rivers, TX by NuStar Plan to connect the storage facility to NuStar’s existing 16-inch pipeline that can transport 200,000 BPD to NuStar’s Corpus Christi North Beach storage terminal Both projects expected to be in-service 2Q 2012 26 |
Plan to develop a new pipeline system in the Eagle Ford Shale as a result of Letters of Intent entered into in the 2nd Quarter of 2011 NORTH BEACH OAKVILLE 16” line 27 Potential New 3 rd Party Pipeline Existing NuStar Pipeline Potential New Storage Facility |
28 Pursuing additional projects in the Eagle Ford Shale to better utilize Houston 12” line and idle 8” line out of Pettus NORTH BEACH OAKVILLE 16” line PETTUS Underutilized Existing NuStar Pipeline 8” line 12” line Potential New NuStar Pipeline Existing NuStar Pipeline Potential New Storage Facility |
Plan to construct a new 3 bay truck rack for crude offloading at our Elmendorf storage facility and a new 12 mile 8” crude oil pipeline from the facility to the San Antonio Refinery Project should reduce transportation costs and unplanned refinery outages by improving crude supply logistics and crude quality for San Antonio Refinery Total CAPEX should be around $20 million Expected in-service 1st quarter 2012 Constructing a new 8” pipeline to supply crude to San Antonio refinery 29 |
One of our customers has approached us about increasing the amount of refined products that supply the San Antonio market Total CAPEX currently estimated at about $13 million Pipeline capacity on the line could be increased by the start of the 4th quarter 2012 In the early planning stages of expanding the capacity of our refined products pipeline that supplies the San Antonio market 30 |
Asphalt & Fuels Marketing Overview Asphalt & Fuels Marketing Overview Paul Brattlof Paul Brattlof Senior VP – Senior VP – Supply & Trading Supply & Trading 31 |
Earnings from San Antonio refinery acquisition and improved earnings in Fuels Marketing are offset by lower Asphalt results Asphalt & Fuels Marketing 2011 Summary Weak asphalt demand and high feedstock costs should cause EBITDA in our asphalt operations to be lower than 2010 April 2011 San Antonio refinery acquisition contributing slightly less than expected due to higher crude costs Strong fuels marketing results in 2011 due to the expansion of crude trading and bunker fuels marketing in late 2010 Full year 2011 segment EBITDA expected to be lower compared to 2010 2006 2007 2008 2009 2010 $80 $111 $127 32 Asphalt Fuels Marketing $27 $22 $37 $10 $37 $90 $70 $74 Segment EBITDA ($ in millions) |
33 San Antonio Refinery acquisition expected to be a solid contributor to our Asphalt & Fuels Marketing segment Approximately 70% of refinery production is hedged (spread between WTI and refined products) over the next three to four years New 8” crude pipeline from Elmendorf should reduce transportation costs and unplanned refinery outages by improving crude supply logistics Expect refinery to generate around $15 million of EBITDA in 2011 Slightly lower than expected due to increased crude costs 14,500 BPD refinery acquired for $41 million plus working capital YTD Run rates ~11,500 BPD Processes crude and condensate from nearby Eagle Ford shale and other South Texas formations Produces and sells jet fuel, ULSD, naphtha, reformate and LPG’s |
2011 Summary Currently market out of four NuStar locations: St Eustatius Pt Tupper Texas City Los Angeles NuStar Bunker sales volumes are up 98% since 2009 since adding new marketing operations at Texas City and Los Angeles. Dependable and competitively priced supply is key to making a successful Bunker Marketing operation. Term purchases make up 55% of total supply of bunker fuel 2012 Outlook Looking to expand in more markets where we can gather our own supply and effectively penetrate the market Bunker Marketing – 2011 Looks to be best year ever St. Eustatius Texas City Pt Tupper Los Angeles 34 |
35 Asphalt Operations initiatives to lower supply costs and improve margins 2011 Summary Asphalt Demand is down 1.5% thru June on an annualized basis However, East Coast asphalt prices have averaged $50 per ton premium over the Mid-Continent and Gulf Coast rack prices Midwest refiners with lower feedstock costs have incentive to supply East Coast markets Asphalt results expected to be lower than 2010 2012 Initiatives Entered into 10,000 barrel per day Peregrino Crude Oil Purchase agreement with Statoil. Contract commences December 2011. Pursuing Heavy Canadian rail supplied crude for Paulsboro and Savannah refineries Pursuing asphalt off-take agreements with regional suppliers to create more flexibility within system to take advantage arb’s |
Heavy Oil Trading – Texas City rail blending hub has become dependable outlet for Midwest refiners Texas City has become a dependable rail outlet for heavy oils from Midwest refiners - volumes expected to be up 50% vs. 2010 Midwest refinery utilization is currently above 93%, providing ample supply of VTB’s Texas City is a true Black Oil blending hub gathering heavy oils, asphalts, slurry oil and other blend stocks to blend into either bunker fuel, asphalt or fuel oil Most of the Heavy Oil bought is blended into Bunker Fuel and sold internally to our Bunker Marketing Group at Texas City; the remainder is sold into the Houston area spot market 36 Source: Energy Information Administration PADD II Refinery Utilization Rates Year average 80.0% 82.0% 84.0% 86.0% 88.0% 90.0% 92.0% 94.0% 96.0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2011 Summary 2012 Outlook Looking to expand the Texas City concept to our Mobile, AL and Wilmington, CA terminals |
Crude Trading – continue growing domestic rail gathering systems at St. James, LA and Texas City, TX 2011 Summary Brent crude is trading at historically high premiums over WTI Gulf Coast Light Louisiana Sweet (LLS) is also trading at historically high premiums to WTI Increased production of Bakken crude in North Dakota and Eagle Ford in South Texas can be railed to our waterborne terminals and marketed to gulf coast refiners St. James is a Hub Terminal located in the center of the Gulf Coast domestic crude trading and blending market Currently can gather up to 10,000 barrels per day on manifest rail Texas City is our newest gathering point for Eagle Ford crude Currently can receive truck and rail up to 3,000 barrels per day 2012 Outlook Looking for ways to expand volumes at St James into a unit train Looking to expand truck capabilities at Texas City by adding additional offloading lanes 37 - 3 8 13 18 23 28 33 1/1 2/1 3/1 4/1 5/1 6/1 7/1 8/1 9/1 10/1 11/1 12/1 2009 2010 2011 9/19 $28.06/bbl LLS over WTI (Front Month) 2 |
St. James Terminal Overview St. James Terminal Overview Kyle Oppliger Kyle Oppliger Vice President &General Manager Vice President &General Manager – – Gulf Region Gulf Region 38 |
39 St James Terminal Description Tanks 28 tanks Capacity: 8,000,000 barrels Size Range 36,000 to 680,000 barrels Employees 22 employees Products Crude Oils Land ~ 900 Acres Modes Served Vessel, Barge, Pipeline, Rail, Truck • 3 Ship/Barge Docks (2 have vessel capacity) • 20 Railcar unload facility (Bakken) • 70,000 bpd Unit train facility ( under construction) • 2 Truck unload spots • Pipelines • 40” to Capline • 30” to Exxon, Shell and LOOP • 20” to Exxon • 48” to Locap |
40 St James Schematic Overview St James Terminal |
41 NuStar’s Vision and Strategy Demonstrate excellence in safety and environmental performance, operations, customer service and community involvement Develop St. James Terminal into an integrated hub location to capitalize on opportunities for light sweet crude blending and heavy crude blending St James Terminal provides unique market advantages due to access to key logistics and markets Grow hub terminal with fee-based business while providing access to key niche markets for margin-based opportunities Fee business provides base revenue to support critical infrastructure improvements with a reasonable return on the partnership’s investments Hub customers provide NuStar MS&T with ready access to trading partners Vision and Strategy for St James Terminal |
42 Commitment and Focus on Safety Achieved 20 years without lost time incident Approaching 16 years without OSHA recordable Process Safety Management (PSM) – foundation of safety and operating programs Recognized as OSHA Star Site Voluntary Protection Program (VPP) Safety and Environmental Performance |
43 Environmental Performance Reportable spills – Zero in 2010, 1 in 2011 Zero Notice of Violations Compliance calendar and audits Implemented DOT compliance programs for pipelines Implemented Pipeline Integrity Program Equipment upgrades and preventive maintenance programs Safety and Environmental Performance |
44 Marine Facilities Two ship docks Dock 5 w/ 2 – 16” loading arms Dock 2 w/3 – 16” loading arms ship or barge for crude and fuel oil One barge dock capable of crude and fuel oil and vapor destruction for crude oil loading Truck Receipts Two metered truck receipt skids Rail Facilities Unload facilities with capacity of 20 rail cars per day St James Key Logistics |
45 Valero Trafigura NuStar Marketing, Supply and Trading Statoil EOG Resources Current Customers |
46 2006 (Dec) – Acquired St James Terminal from Koch 14 tanks with 3.3 million barrels of storage capacity Existing 3 rd Party blending programs Valero Marketing and Supply Co.’s refinery crude supply Koch crude oil and fuel oil blending 2007 – 3 rd Party Expansion (1.5 million barrels) Constructed four new tanks for Trafigura crude oil blending Designed internal pipeline infrastructure to accommodate future expansion Upgraded Dock #1 with marine vapor destruction unit 2008/2009 – Ship Shoal Pipeline Connection Upgrade Constructed new metering facilities and upgraded pipeline connection increasing fee- based pipeline revenues and providing greater access to desired crudes 2010 – Bakken Crude for NuStar MS&T (110,000 barrels) Acquired idled LaJet Refinery property and storage tanks Refurbished two tanks to provide crude oil storage Reactivated idle rail spur and provided 20 rail spots for Bakken crude oil receipts Implementing the Strategy Completed Projects |
47 2010 – 3rd Party Expansion – Phase 1 (3.2 million barrels) Constructed 7 tanks for Trafigura and Statoil for crude oil storage Infrastructure upgrades include improving pipeline connectivity and reactivating an idled marine ship dock Storage tanks went into service in July / August 2011 Storage capacity of the terminal has grown from 3.3 million barrels in December 2006 to ~ 8.0 million barrels after the Phase 1 expansion project Implementing the Strategy Current Projects |
48 2011 – 3rd Party Expansion – Phase 2 Project currently in development to provide additional storage opportunities to refining and trading companies Expect new tanks to store crude oil and fuel oil Additional Storage Expansion Customer interest remains high and facility has property for additional storage expansion New Rail and Unit Train Offloading Project for EOG Facility should be able to handle at least one 70,000 barrel train per day Implementing the Strategy Future Opportunity |
LEGEND Current Construction Future Heated Storage Future Non Heated Storage Implementing the Strategy 49 NUSTAR |
50 Implementation of Strategy NuStar St. James Terminal EBITDA ($millions) 2012 EBITDA could be double 2011 results |
51 Terminal acquired from Koch in Dec 2006 Employees naturally embraced NuStar’s culture and have demonstrated excellence in safety, environmental, community service and customer satisfaction Implementation of hub strategy has more than doubled the total storage capacity of the facility and current project plans schedule through 2012 could quadruple the storage capacity Integrating NuStar MS&T into the hub terminal landscape has created niche rail pipeline opportunities to capture emerging Bakken crude play Future remains bright at St James with high customer interest and opportunities to continue storage expansion, and expand our unit train rail capabilities. A Bright Future for St. James |
Closing Remarks Closing Remarks and Q&A and Q&A Curt Anastasio Curt Anastasio CEO & President CEO & President 52 |
Management Management Team Bios Team Bios 53 |
Management Bios Management Bios Curt Anastasio, CEO & President President and CEO of NuStar Energy L. P. (NYSE: NS) and NuStar GP Holdings, LLC (NYSE: NSH) Anastasio has been President of NuStar Energy L.P. and its predecessors since December 1999, and he assumed the position of CEO of NuStar GP Holdings, LLC in 2006. Prior to becoming President of NuStar GP, LLC in 1999, Anastasio held various positions in supply, trading, transportation, marketing, development and legal. He has 22 years of industry experience. Curt serves on the Board of the National Association of Publicly Traded Partnerships and as a Director of the San Antonio Branch of the Federal Reserve of Dallas. In addition to participating in various volunteer activities, Curt serves on the Board of Trustees of the United Way of San Antonio and Bexar County, and is the communitywide United Way Campaign Chairman for 2011. He also serves as a board member of the San Antonio Medical Foundation , Southwest Research Institute, Texas Biomedical Research Institute, Alamo Area Council of the Boy Scouts of America, and the Economic Development Foundation – all in San Antonio. In addition, Anastasio belongs to various professional organizations and has lectured and written on legal and business topics. Curt received a Juris Doctorate degree from Harvard Law School in 1981 and a Bachelor of Arts degree, Magna cum Laude, from Cornell University in 1978. After graduation, he practiced law in New York City. 54 |
Management Bios Management Bios Steve Blank, Senior VP - CFO & Treasurer Chief Financial Officer, Senior Vice President and Treasurer of NuStar Energy L.P. In this position, he is responsible for corporate finance, external reporting, accounting, budgeting and forecasting, investor relations, risk management, tax, treasury and credit. Before that, Steve held a variety of positions with Ultramar Diamond Shamrock and Valero Energy in New York, London and San Antonio, including Director, Planning and Development (1980-83); Assistant Treasurer – Corporate Finance (1983-90); Vice President of Investor Relations (1991-95); Vice President – Information Technology (1996); and Vice President – Finance and Treasurer (1996-01). Before joining Ultramar Diamond Shamrock in 1980, Steve worked for two years with National Westminster Bank in New York. Steve received a BA in History from the State of University of New York in 1976. He went on to obtain a Master’s in International Affairs, with a specialization in Business, from Columbia University in 1978. 55 |
Management Bios Management Bios Rick Bluntzer, Senior VP - Operations Rick Bluntzer, Senior Vice President of Operations oversees NuStar Energy L.P.’s extensive pipeline, terminal, international and asphalt & fuels refining operations. Additionally he oversees NuStar’s engineering, information systems (operations) and procurement organizations. Rick began his career with Valero Refining Company in 1976, serving in various operating and management positions until 1997, when he became a part of Valero’s refinery acquisition team. Rick joined the Valero L.P. organization after the Valero/UDS merger and held various senior operating and management positions, contributing to the success and transition of today’s NuStar organization. 56 |
Management Bios Management Bios Brad Barron, Senior VP - General Counsel 57 Brad Barron serves as Senior Vice President and General Counsel of NuStar Energy L.P. and NuStar GP Holdings, LLC, both of which are headquartered in San Antonio, TX. As such, he provides legal counsel on all major transactions, assures compliance with securities laws, provides legal counsel to the boards of directors and principal officers, manages real estate and right-of-way issues, and oversees health, safety and environmental compliance. Prior to joining the company, Mr. Barron was with Valero Energy Corporation. Mr. Barron began his legal career with Vinson & Elkins LLP and continued in private practice until he joined Valero in 2001. A committed volunteer, Mr. Barron is also active in the San Antonio community. He serves on the boards of directors of the Witte Museum, Alamo Bowl and Family Service Association, and he previously volunteered as a board member of the Boys and Girls Club of San Antonio. He also serves on the Texas Tech Foundation Board. Mr. Barron holds a B.B.A. from Texas Tech University and a J.D. from the University of Texas School of Law. In addition, Mr. Barron holds a M.L.A. from St. John’s College. |
Management Bios Management Bios Paul Brattlof, Senior VP - Supply and Trading 58 Paul Brattlof leads NuStar Energy L.P.’s Marketing, Supply and Trading organization, which includes products trading, crude supply & trading, heavy fuels trading bunker marketing and asphalt marketing. Under Mr. Brattlof’s leadership, this organization capitalizes on opportunities to optimize the use and profitability of the company’s worldwide portfolio of assets, manages risk as NuStar diversifies its business, and enhances the company’s competitive position when pursuing acquisitions. Mr. Brattlof has more than two decades of experience in cash markets, futures markets and derivatives trading. Previously, he served as Vice President of Trading for Valero Energy Corporation, where he worked for 10 years. Prior to that, he spent 11 years with Kerr-McGee Refining and two years with Mieco, a Long Beach-based trading company. A graduate of Rice University, Mr. Brattlof holds a Bachelor of Arts degree in Managerial Studies. |
Management Bios Management Bios Mike Hoeltzel, Senior VP – Strategic Planning & Economics Senior Vice President for NuStar Energy L.P., responsible for developing strategic plans, refinery planning, market analysis, and project evaluations Joined NuStar in February 2007 with 30 years refinery experience. Valero Energy's Corporate Development Department from 2000 to 2007. Primary responsibility was valuation of refinery acquisitions during this period of growth from 6 to 19 refineries. Also supported growth of Valero L.P. during 2002-2006 when M&A opportunities for both companies were developed in a common department. Worked in CITGO's Corpus Christi refinery from 1991-2000 in various Project Management, Planning & Economics, and Strategic Planning positions. Worked in Kerr-McKee's Corpus Christi refinery from 1977-1991 in Project Management and Planning & Economics positions. Worked for Exxon in Oil Production from 1971-1973 and Dupont from 1973-1977, project engineering assignments with both companies. Graduated from Oklahoma State University in 1971 with BS and MS degrees in Mechanical Engineering. Also received MBA from Corpus Christi State University (now Texas A&M Corpus Christi) in 1983 59 |
Management Bios Management Bios Danny Oliver, Senior VP - Marketing and Business Development 60 Danny Oliver, Senior Vice President of Marketing & Business Development for NuStar Energy L.P., oversees the company’s commercial activities for its pipelines and terminals business. Previously, he served as Vice President of Product Supply & Trading for NuStar where he was instrumental in building the company’s successful trading operations from the ground up. He brings nearly 20 years of industry experience – the majority of which was spent trading energy commodities. Prior to joining NuStar in 2007, Mr. Oliver spent 10 years at Valero Energy holding management positions in Product Supply & Trading where he helped to build a world-class refined product trading organization and played a key role in the company’s aggressive acquisition of refinery and logistics assets. He previously worked at Enron Corp. in the International Trading division where he was responsible for the company’s worldwide MTBE and Methanol trading activities, and also held several positions at Kerr-McGee Refining & Marketing in products scheduling and accounting, with an emphasis in reporting and analyzing trading activities. Mr. Oliver graduated from Texas State University with a B.B.A. in Accounting. Committed to the community in which he works and lives, Mr. Oliver currently serves on the boards of directors of San Antonio Sports and the Harmony Ridge Association. He is also actively involved with his church and the United Way of Bexar County. |
Management Bios Management Bios Kyle Oppliger, VP GM - Operations 61 Kyle Oppliger serves as the Vice President and General Manager of the NuStar Gulf Coast region. As such, he manages all aspects of the region’s operations, maintenance, capital projects, safety and environmental compliance, quality assurance and security initiatives for NuStar terminal assets in Texas, Louisiana, Alabama, Georgia and Florida. He brings over 15 years of experience in refining and terminal operations. Prior to joining NuStar in 2006, Mr. Oppliger spent 10 years at Valero Energy holding leadership roles in operations, planning and economics and laboratory departments. He has played a key role in the aggressive integration and development of acquired assets in NuStar’s Gulf Coast region. He previously worked for Phibro and Basis refining companies, and prior to working in the refining industry, Mr. Oppliger worked as a chemist in research and development. As a committed volunteer, Mr. Oppliger has been active in communities in which NuStar does business, including United Way organizations throughout the Gulf region. Additionally he has been active in youth mentoring programs, Big Brothers & Big Sisters and Boy Scouts of America. Mr. Oppliger received his undergraduate degree in Chemistry from Sam Houston State University and his Master’s degree in Business from University of Houston. |
62 Appendix Appendix |
63 Reconciliation of Non-GAAP Financial Information: EBITDA (Unaudited, Dollars in Thousands) The following is a reconciliation of net income to EBITDA: 2002 2003 2004 2005 2006 2007 2008 2009 2010 Net income 55,143 $ 69,593 $ 78,418 $ 107,675 $ 149,906 $ 150,298 $ 254,018 $ 224,875 $ 238,970 $ Plus interest expense, net 4,880 15,860 20,950 41,388 66,266 76,516 90,818 79,384 78,280 Plus income tax expense 395 - - 4,713 5,861 11,448 11,006 10,531 11,741 Plus depreciation and amortization expense 16,440 26,267 33,149 64,895 100,266 114,293 135,709 145,743 153,802 EBITDA 76,858 111,720 132,517 218,671 322,299 352,555 491,551 460,533 482,793 Note: 2005 and 2006 EBITDA are from continuing operations. Year Ended December 31, NuStar Energy L.P. utilizes a financial measure, EBITDA, that is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced perspective of the operating performance of the partnership's assets. EBITDA is not intended nor presented as an alternative to net income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles. |
64 Reconciliation of Non-GAAP Financial Information: Storage Segment The following is a reconciliation of operating income to EBITDA for the Storage Segment: 2006 2007 2008 2009 2010 Operating income 108,486 $ 114,635 $ 141,079 $ 171,245 $ 178,947 $ Plus depreciation and amortization expense 53,121 62,317 66,706 70,888 77,071 EBITDA 161,607 $ 176,952 $ 207,785 $ 242,133 $ 256,018 $ Projected incremental operating income range $ 11,000 - 20,000 Plus projected incremental depreciation and amortization expense range 9,000 - 10,000 Projected incremental EBITDA range $ 20,000 - 30,000 The following is a reconciliation of operating income to EBITDA for our St. James, LA terminal: 2007 2008 2009 2010 Operating income 10,785 $ 10,226 $ 14,079 $ 14,045 $ Plus depreciation and amortization expense 5,011 5,564 6,866 6,175 EBITDA 15,796 $ 15,790 $ 20,945 $ 20,220 $ The following is a reconciliation of projected annual operating income to projected annual EBITDA for our St. James, LA terminal: Projected operating income 21,512 $ Plus projected depreciation and amortization expense 7,296 Projected EBITDA 28,808 $ Year Ended December 31, 2011 Year Ended December 31, The following is a reconciliation of projected incremental operating income to projected incremental EBITDA: Year Ended December 31, Year Ended December 31, 2011 (Unaudited, Dollars in Thousands) NuStar Energy L.P. utilizes a financial measure, EBITDA, that is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced perspective of the operating performance of the partnership's assets. EBITDA is not intended nor presented as an alternative to net income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles. |
65 Reconciliation of Non-GAAP Financial Information: Transportation Segment The following is a reconciliation of operating income to EBITDA for the Transportation Segment: 2006 2007 2008 2009 2010 Operating income 122,714 $ 126,508 $ 135,086 $ 139,869 $ 148,571 $ Plus depreciation and amortization expense 47,145 49,946 50,749 50,528 50,617 EBITDA 169,859 $ 176,454 $ 185,835 $ 190,397 $ 199,188 $ The following is a reconciliation of projected decrease in operating income to projected decrease in EBITDA: Projected decrease in operating income ($ 5,000 - 15,500) Plus projected incremental depreciation and amortization expense range 0 - 500 Projected decrease in EBITDA range ($ 5,000 - 15,000) Year Ended December 31, 2011 Year Ended December 31, NuStar Energy L.P. utilizes a financial measure, EBITDA, that is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced perspective of the operating performance of the partnership's assets. EBITDA is not intended nor presented as an alternative to net income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles. (Unaudited, Dollars in Thousands) |
66 Reconciliation of Non-GAAP Financial Information: Asphalt and Fuels Marketing Segment (Unaudited, Dollars in Thousands) Asphalt Operations Fuels Marketing Operations Asphalt and Fuels Marketing Segment Operating income 53,977 $ 36,884 $ 90,861 $ Plus depreciation and amortization expense 20,164 93 20,257 EBITDA 74,141 $ 36,977 $ 111,118 $ Asphalt Operations Fuels Marketing Operations Asphalt and Fuels Marketing Segment Operating income 50,710 $ 9,919 $ 60,629 $ Plus depreciation and amortization expense 19,463 - 19,463 EBITDA 70,173 $ 9,919 $ 80,092 $ Year Ended December 31, 2007 Year Ended December 31, 2006 Asphalt Operations Fuels Marketing Operations Asphalt and Fuels Marketing Segment Asphalt and Fuels Marketing Segment Asphalt and Fuels Marketing Segment Operating income 76,267 $ 36,239 $ 112,506 $ 21,111 $ 26,815 $ Plus depreciation and amortization expense 14,182 552 14,734 423 - EBITDA 90,449 $ 36,791 $ 127,240 $ 21,534 $ 26,815 $ Year Ended December 31, 2009 Year Ended December 31, 2008 NuStar Energy L.P. utilizes a financial measure, EBITDA, that is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced perspective of the operating performance of the partnership's assets. EBITDA is not intended nor presented as an alternative to net income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles. The following tables reconcile operating income to EBITDA for asphalt operations and fuels marketing operations in our asphalt and fuels marketing segment: Year Ended December 31, 2010 |
67 Reconciliation of Non-GAAP Financial Information: Acquisitions (Unaudited, Dollars in Thousands) San Antonio Refinery Turkey Total Projected annual operating income 17,000 $ 1,000 $ 18,000 $ Plus projected annual depreciation and amortization expense 2,500 1,800 4,300 Projected annual EBITDA 19,500 $ 2,800 $ 22,300 $ Year Ended December 31, 2011 Projected operating income 13,000 $ Plus projected depreciation and amortization expense 2,000 Projected EBITDA 15,000 $ The following is a reconciliation of projected annual operating income to projected annual EBITDA for our 2011 Acquisitions: The following is a reconciliation of projected operating income to projected EBITDA for the San Antonio Refinery acquisition: NuStar Energy L.P. utilizes a financial measure, EBITDA, that is not defined in United States generally accepted accounting principles. Management uses this financial measure because it is a widely accepted financial indicator used by investors to compare partnership performance. In addition, management believes that this measure provides investors an enhanced perspective of the operating performance of the partnership's assets. EBITDA is not intended nor presented as an alternative to net income. EBITDA should not be considered in isolation or as a substitute for a measure of performance prepared in accordance with United States generally accepted accounting principles. |