Williams Partners' CEO Present At 2012 Barclays Capital CEO Energy-Power Conference (Transcript)

Williams Partners L.P. (WPZ)

2012 Barclays Capital CEO Energy-Power Conference Transcript

September 5, 2012 11:00 AM ET

Executives

Alan Armstrong - President and CEO

John Porter - Investor Relations

Don Chappel - Chief Financial Officer

Analysts

Rick Gross - Barclays Capital

Presentation

Rick Gross - Barclays Capital

Next on the agenda, its part of our part of the program we have Williams Companies. Williams over the last several years has dramatically restructured their operations, where they hold their assets, and they have significantly unlocked value in doing so.

While, they’ve come a long way in both of those areas, we continue to see evolution on both fronts. We continue to see the company migrate from historically being kind of Rocky-centric maybe commodity sensitive company, into more geographically dispersed fee-based company. We continue to see assets migrate from the parent found into the CMLP.

And over this period of time, as I said, we’ve had considerable amount of value created and we are very, very happy to have Alan Armstrong, the President and CEO of Williams, give us an update on how all of this is manifesting itself and continuing to create value for us.

Alan Armstrong

Thanks, Rick, and good morning. We’ve got John Porter here this morning; and Don Chappel, our CFO will be joining us for the question session, after, he’s got a couple of phone calls to make right now.

Well, I’m going to go through today, first of all, hitting some of the industry fundamentals that we think are favorable for our business. Talk about how Williams is positioned up again some of those fundamentals and we’re kind of really take advantage of that.

Then I’ll highlight just a few of the areas. It’s really hard to pick, frankly, we’ve so many great growth opportunities going on throughout our business right now. It’s going to hard to pick a few but we did pick a few and I’ll hit some of those.

Also talk little about our overall capital budget and kind of the diversity of a lot of our big fee-based projects that are going on and as well provide some new information on our plans to drop down our Geismar facility, and some of the logic behind that. And then finally, I’ll pull this all together in terms of what that means to our continued growth and sustainable dividend forecast.

So, with that, the forward-looking statements, you have, those that you can read, it’s your pleasure there. And I’ll move into this first slide talking about the industry fundamentals little bit.

Firs of all, I don’t think its any secret today that the supply in our business and the supply growth is here. I don’t -- we’ve been perceiving that for quite a while as Williams just because we are in the E&P business. We saw how much cost for continuing to lower in our operations, but also those producers that we work alongside and that we provide a midstream services.

Today I would tell you that’s no secrete and I think broadly the market understands that. What’s changing I think though, that is perhaps not all that well understood is how much the demand side is starting to pick up and the kind of investments that are going in to the demand that people keep wondering where that demand is.

Now today you have this short-term phenomena and this is completely price driven where natural gas is budding its way into the short-term markets that its completely price sensitive on the coal side, on the power generating side that we’ve seen this summer that’s helped the balance the market a little bit.

But with the kind of demand growth that we are seeing is really based on big long-term capital investment and so its big power generation, its steel plant, its fertilizer plants and we are seeing a tremendous amount of interest and growth along our big interstate pipeline that we think is probably a couple years out from where they showing itself and once that capital and once all that capital investment that’s very sustainable demand growth.

So on one side we’ve got supply growth, on the other side we’re seeing a large increase in demand growth and in between that is going to come a lot of infrastructure. Not just in consuming all these great natural gas resources, but as well the natural gas liquids that are be coming off of this and as well petchem industry that’s expanding rapidly as well and we think Williams is extremely well-positioned to provide a lot of that large scale infrastructure that take advantage of this relatively low priced resource that we have here in U.S.

Certainly, we have a lot to be thankful for here and in North America in that regard and I think to often we don’t give enough credit to all the great independent producers that have gone out and found a way to continue to lower the cost and increase the productivity on the drilling operations and they really are presenting the U.S. today with the great value opportunity.

But it is going to take a lot of infrastructure and a lot of regulatory hurdles to get through get that infrastructure build out. We think Williams is good in both of spaces and we are very excited about the future as result of that.

This slide just then looks at are the industry, first, looking at the industry fundamentals that I just spoke about, but and I don’t think, I don’t hear much argument to that story that that the industry fundamentals are great and we are well-positioned.

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