1 Caiman Brent Breon

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Utica Midstream Discussion Brent Breon VP Business Development

April 2013

Today’s Discussion

I. The Formation of Blue Racer Midstream II. What is Midstream Services?

III. How Blue Racers Assets and Plans Meet the Utica Producer Needs

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Caiman Energy: Regional Experience Caiman developed a large rich gas system in West Virginia from 2009-2012 Overview of Caiman ¡

Franchise system underpinned by 225,000 dedicated acres and minimum volume commitments for gathering and processing through contracts with high-quality producers

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Caiman signed its first contract with AB Resources in Q4 2009

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170 miles of gathering lines by year-end 2012 } Over 50 miles of condensate gathering lines by year-end 2012

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Fort Beeler NGL Processing and De-ethanization Complex

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Moundsville Fractionation and NGL Processing Complex

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Over $1 billion invested in infrastructure by year-end 2013

Caiman Marcellus Focus Area

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Dominion Resources Overview

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The Right Combination

 Strategically located assets throughout the Utica

 Shale midstream execution expertise

 Experienced operations team

 Rapid development of West Virginia Marcellus rich gas gathering, processing and fractionation system  Private equity funding

 100 years of continuous operations  Appalachian NGL expertise  Major local presence

 Committed capital for system expansions 5

Midstream Services for Utica Producers

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US Natural Gas and Oil Production The development of techniques to produce oil and gas from shales has dramatically increased midstream infrastructure needs across the US.

For every $1 spent on upstream activity, a subsequent $.15 to $.35 needs invested in midstream infrastructure

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US Natural Gas and Oil Production The Marcellus, Eagle Ford, Bakken, Permian, Cana-Woodford, and Utica Plays will impact conventional sources of natural gas and NGL production but will require significant infrastructure build out Bakken

Utica

Marcellus Permian CanaWoodford

Eagle Ford Source for map: EIA, 2004.

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Midstream Natural Gas Services

Source: Enterprise Products Partners

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Midstream Natural Gas Services Dry Natural Gas:  Meets interstate gas spec  Below 1100 Btu  Pipeline, compression, meter, and tap

Wet or Rich Natural Gas:  Does not meet interstate gas specs  Over 1100 Btu  Requires processing to remove heavy hydrocarbons  Pipeline, meter, separation, cryogenic processing, and fractionation  Creates the most value from production stream

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Midstream Natural Gas Services Services Utilized by Midstream:    

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Land Acquisition Right of Way Acquisition Environmental Permitting Pipeline Construction  Gathering  Condensate  Oil  Residue Gas Plant and Facility Construction Safety Trailing Reclamation Lodging and Catering Etc.

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Gathering Pipeline Pipelines gather natural gas, oil, and condensate to Processing Plant

Well Head

Gathering

Natural Gas Oil/Condensate

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Cryogenic Processing Cryogenic processing strips valuable NGLs from the gas stream

Rich Gas

Processing

Residue Gas NGLs

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Fractionation Fractionation separates the respective NGLs into discrete purity hydrocarbons

Ethane*  Volatile NGL  Market for ethane has strengthened as petrochemicals have increasingly switched to ethane as a feedstock

Propane

NGLs

Fractionation

 Various sources of demand:  25% - residential market  30% - petrochemical demand  35% - commercial/industrial/agricultural

Butanes  Iso vs. normal butane pricing and liquidity differences  Petrochem feedstock  Ethanol blend stock

Pentanes+  Blend stock of motor gasoline  Highest priced NGL

* Ethane may be recovered or rejected by modern cryogenic processors.

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The Right Choice

The Right Combination The Right Approach The Right Assets

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The Right Assets Gathering Assets  DEO and DTI rich gas gathering lines  500+ miles of 8”-30”  In heart of Utica

Processing  Natrium plant    

200 MMcf/d cryo skid Start-up April 2013 Expandable footprint Residue line to Dominion

Fractionation/NGLs  36,000 Bbls/d fractionator

 Expandable to 59,000 BBls/d  C4 splitter  60-mile ethane pipeline

 Rail and truck loading  Barge access in Phase II 16

The Right Approach Provide full value and reliable takes during all phases

Delineation Phase

Development Phase

Reliability & Value  Utilize existing assets for early flows  Enhancing system capabilities  Simple contract structures

Maximize Value to Producer  Expand gathering lines to meet volume growth

 Provide full processing value  Existing Natrium facility  Third party plant connectivity

 Strategically locate plants to maximize system flows and netbacks  Pursue NGL and residue strategy

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Why Delineate?

Delineation mitigates risks and maximizes producer returns All Utica Wells Initial Results  Over 200 wells drilled to date  Concentrated early activity  Encouraging results, but major questions remain Outstanding Reservoir Issues  Wet gas transition line  Potential of the oil window  Northern and southern extent of play On-Going Economic Issues  Processing spreads  Impact on residue and NGL prices  Sustainability of drilling plans Source: Ohio DNR. Wells that producers are drilling or have drilled.

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Why Delineate?

Delineation mitigates risks and maximizes producer returns Excluding CHK and GPOR Initial Results  Over 200 wells drilled to date  Concentrated early activity  Encouraging results, but major questions remain Outstanding Reservoir Issues  Wet gas transition line  Potential of the oil window  Northern and southern extent of play On-Going Economic Issues  Processing spreads  Impact on residue and NGL prices  Sustainability of drilling plans Source: Ohio DNR. Wells that producers are drilling or have drilled.

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Our Answer for Delineation Enhance system capacity with initial investments in strategic assets  Construct Western Connector (Q3’13)  Directly connect Noble, Washington, Guernsey, Tuscawaras  Install 200 MMcf/d Cryo Skid (Q4’13 – Q1’14)  Increases available processing to 400 MMcf/d total  Available for firm and IT processing capacity

Delineation Phase provides producers with full value and reliable takes until full scale development can be completed

Hasting Cryo: IT Capacity

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Ready When You Are Blue Racer has approved Development Phase construction and associated funding  High volume trunk and gathering lines to committed acreage positions  Link new development to existing infrastructure  Southern focus between Western System and mainlines (Noble, Washington, Guernsey, Tuscawaras)  Northern focus into mainlines and building gathering in NE OH and NW PA  New processing complexes to maximize system hydraulics and capture premium values  Berne – TETCO  Petersburg – TGP, DTI, DEO  Lewis – TGP, DTI, DEO  Increase optionality at Natrium  Residue expansion: TETCO, DEO, & REX  Propane connectivity with TEPPCO 21

Providing Value, Today and Tomorrow Blue Racer is positioned to help producers realize full value for their production while they delineate acreage today and develop acreage tomorrow  Utilize existing infrastructure to delineate acreage throughout the Utica  500+ miles of pipeline  200 MMcfd cryogenic processing plant  36,000 Bbl/d fractionator

 Expand existing system capabilities with strategic investments  Western Connector  Additional 200 MMcf/d cyro plant

 Expand gathering infrastructure in advance of development  Provide optionality to deal with uncertainty 22