Exhibit 99.1
NGP CAPITAL RESOURCES
COMPANY
EnerCom Oil & Gas Conference
August 7 – 11, 2005
Forward-Looking Statements
This presentation contains forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, which could cause actual results and conditions to differ materially from those projected, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, the future operating results of our portfolio companies, changes in regional, national, or international economic conditions and their impact on the industries in which we invest, or changes in the conditions of the industries in which we invest, and other factors enumerated in our filings with the Securities and Exchange Commission.
Words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may” and similar expressions may be used to identify forward-looking statements. Undue reliance should not be placed on such forward-looking statements as such statements speak only as of the date on which they are made. We do not undertake to update our forward-looking statements unless required by law.
Persons considering an investment in NGP Capital Resources Company should consider the investment objectives, risks, and charges and expenses of the company carefully before investing. Such information and other information about the company is available in our annual report on Form 10-K, our quarterly reports on Form 10-Q and in prospectuses we issue from time to time in connection with our offering of securities. Such materials are filed with the SEC and copies are available on the
SEC’s website, www.sec.gov. Prospective investors should read such materials carefully before investing.
NGPC
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NGP Capital Resources Company
NGP Capital Resources Company (Nasdaq: NGPC) is a publicly held financial services company that invests primarily in securities of small and midsized energy companies.
NGPC offers yield and total return investors the opportunity to participate in investments that target the capital needs of these small and midsized companies.
Our primary focus is in the domestic upstream and midstream businesses.
NGPC leverages Natural Gas Partners’ highly successful franchise that focuses on private equity investments in the energy industry.
Our current investment availability is approximately $300 million with capacity of approximately $450 million utilizing leverage with our equity base.
Our public equity capital makes NGPC a permanent source of capital for the energy markets.
NGPC
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NGPC — a business development company
Regulated by the SEC under the Investment Company Act of 1940 and the Securities and Exchange Act of 1934.
Seventy percent of investments must be in the securities of private companies and public companies not listed on a national exchange.
Leverage is restricted to a maximum debt to capitalization of 50%.
The majority of our Board of Directors are independent.
We offer management assistance to our portfolio companies.
NGPC
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NGPC — also a regulated investment company
Income must be generated primarily from investments in securities of portfolio companies.
Mandatory asset diversification.
Annual distribution of at least 90% of taxable income.
No corporate federal income tax.
NGPC
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NGPC — organization
Investment Committee
Officers & Employees
NGP Investment Advisor, LP
Investment Advisory Agreement
Board of Directors
Ken Hersh (NGP) David Albin (NGP) Edward Blessing (Ind.) Kent Conine (Ind.) James Latimer, III (Ind.)
NGP Capital Resources Company
Officers
John Homier
President/CEO
Rich Bernardy
CFO/Treasurer/Secretary
NGPC
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NGPC — our business
NGPC is a flexible source of capital, providing customized financing solutions. We can invest at multiple levels of the balance sheet:
Senior Debt Subordinated Debt Mezzanine Capital Project Equity
Our investments can range from $5 million to over $100 million.
NGPC
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NGPC — our business
Our capital serves a broad range of purposes, including:
Acquisitions and Buyouts Growth & Development Monetizations Structured Vehicles Recapitalizations Restructuring Special Situations
NGPC
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NGPC — our business
Approximately 80% of marketplace is in NGPC’s Target Range
Small deals dominate the number of transactions
NGPC’s investments can range in size from $5MM to over $100MM
Number of Transactions by Size: 2001-1H 2004
Total: 687
58
8%
71%
20%
138
491
< $50 MM $50—$100 MM
> $100 MM
Source: Randall & Dewey
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NGPC — investment criteria
Good management
Proven energy track record
Regional, asset and/or technical expertise
Management controls the pace of development and operations.
Reserves development and engineering play — not a pure exploration or price play.
Acquisition and development projects for oil and gas production and other related investments, such as gas plants, pipelines and gas storage. NGPC can also invest in coal, power, and alternative energy. Target rate of return is dependent on overall risk of the transaction being financed and can range from high single digit to high teens.
NGPC
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NGPC — risk—return spectrum
ENGINEERING RISK
EXPLORATION RISK
IRR Objective
5%
10%
20%
30%
PROVED PRODUCING RESERVES
PROVED NON-PRODUCING RESERVES
PROVED UNDEVELOPED RESERVES
PROBABLE PRODUCING RESERVES
OTHER PROBABLE RESERVES
POSSIBLE RESERVES
OTHER RESOURCE
Investment Types
Bank Debt
Mezzanine Investments
Equity
Parameters
50%—60% of PDP reserves
Up to 150% +/- of PDP reserves with development expected to cure to 50%—60% advance against PDP’s w/i 6-36 mos.
Development expected to cure to 50%- 60% advance against PDP’s w/i 6—36 mos.
No proven reserves, limited probable reserves
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NGPC — financing advantages
Energy Focused and Experienced
Permanent Capital
Speed of Commitment and Closing
One-Stop Shop
Pricing and Structure tailored to the risk assumed
Underwriting Capability
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NGPC — initial public offering
November 2004
17.4 million shares issued at $15.00 per share
Total proceeds $261 million; Net proceeds $244 million
Underwriters: Raymond James; Friedman Billings Ramsey;
Advest, Inc.; BB&T, D. A. Davidson;
Ferris, Baker Watts; Morgan Keegan;
Oppenheimer RBC; Stifel, Nicolaus;
Southwest Securities; Wunderlich.
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NGPC — milestone accomplishments
Established $60 million credit facility with SunTrust.
Built professional and administrative staff.
Created company infrastructure.
Expanding marketing effort and penetration.
Developed and documented internal controls for SOX and other regulatory compliance.
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NGPC — balance sheet summary
December 31, 2004 June 30, 2005
(In millions) (Audited) (Unaudited)
Assets
Investments in portfolio securities $66 $66
Investments in auction rate securities 41 —
Investments in high grade corporate securities — 40
Investments in U.S. Treasury securities — 125
Total investments $107 $231
Cash and cash equivalents $137 $14
Other assets 1 1
Total assets $245 $246
Liabilities and stockholders equity
Accounts payable $1 $1
Dividends payable — 2
Stockholders equity 244 243
Total liabilities and stockholders equity $245 $246
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NGPC — income statement summary
(in millions, unaudited) Quarter Ended June 30, 2005 Six Months Ended June 30, 2005
Investment income $3.7 $7.8
Operating, Other expenses
Management fees .9 1.8
G&A, other expenses .9 1.5
Total operating, Other expenses 1.8 3.3
Net investment income 1.9 4.5
Net realized capital gains .1 .1
Net increase in unrealized depreciation in portfolio securities (.1) (1.4)
Net increase in stockholders equity from operations $1.9 $3.2
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NGPC — targeted investments
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NGPC — summary and conclusion
NGPC is a vehicle that offers investors the opportunity to participate in investments that target the capital needs of small and midsized energy companies.
Our primary focus is to provide financing for domestic upstream and midstream businesses.
Our investments in portfolio companies are in the range of $5 million to over $100 million.
NGPC is a permanent and flexible source of capital for multiple levels of a portfolio company’s balance sheet.
Our financings enable companies to develop their assets, accelerate their growth, and position themselves for other capital markets activities.
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NGP CAPITAL RESOURCES
COMPANY
www.ngpcrc.com
713-752-0062
John Homier Rich Bernardy Kelly Plato
Larry Tharp Steve Gardner Dan Schockling