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December 2017
2
Forward Looking InformationDisclaimer
Forward Looking Information
In the interests of providing Tidewater Midstream and Infrastructure Ltd. (“Tidewater” or the “Corporation”) shareholders and potential investors withinformation regarding Tidewater, including management’s assessment of future plans and operations relating to the Corporation, this document containscertain statements and information that are forward-looking statements or information within the meaning of applicable securities legislation, and which arecollectively referred to herein as “forward-looking statements”. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will","project", "should", "believe", "plan", "intend" and similar expressions are intended to identify forward-looking statements. Forward-looking statements areoften, but not always, identified by such words. Forward-looking statements in this document include, but are not limited to statements and tables(collectively “statements”) with respect to: plans to construct a natural gas pipeline from the BRC to TransAlta’s Sundance and Keephills power plants andassociated take-or-pay agreement; plans to expand the Brazeau River Complex (“BRC”) by 50 MMcf/day; the potential to connect newly acquiredinfrastructure to BRC and provide customers with a new large scale egress solution; plans to connect Tidewater’s Montney assets to its Edmontoninfrastructure/egress hub; benefits generated from an integrated processing and infrastructure network; the increasing relevance of Tidewater’s Deep Basinnetwork, driving utilization and EBITDA growth upward; anticipated margin improvements for Tidewater’s Edmonton assets resulted from the reduction ofcertain fees, costs and tariffs; Tidewater’s plans to build out its Edmonton Energy Hub over the next two to three years and the potential to add propylene,polypropylene and iso-octane production; target annual EBITDA/share growth over the next 24 months and target EBITDA levels; subsequent acquisitions andstrategies for acquisitions, capital projects and expenditures; strategic initiatives; anticipated producer activity and industry trends; and anticipatedperformance. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions orexpectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, as well as known andunknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur and which may cause Tidewater’s actual performance and financial results in future periods to differ materially from anyestimates or projections of future performance or results expressed or implied by the forward-looking statements. These assumptions, risks anduncertainties include, among other things: receipt of third party, regulatory and governmental approvals and consents; completion of the Note offering;Tidewater’s ability to successfully implement strategic initiatives and whether such initiatives yield the expected benefits; future operating results;fluctuations in the supply and demand for natural gas, natural gas liquids (“NGLs”), and iso-octane; assumptions regarding commodity prices; activities ofproducers, competitors and others; the weather; assumptions around construction schedules and costs, including the availability and cost of materials andservice providers; fluctuations in currency and interest rates; credit risks; marketing margins; potential disruption or unexpected technical difficulties indeveloping new facilities or projects; unexpected cost increases or technical difficulties in constructing or modifying processing facilities; Tidewater’s abilityto generate sufficient cash flow from operations to meet its current and future obligations; its ability to access external sources of debt and equity capital;changes in laws or regulations or the interpretations of such laws or regulations; political and economic conditions; and other risks and uncertaintiesdescribed from time to time in the reports and filings made with securities regulatory authorities by Tidewater.
Readers are cautioned that the foregoing list of important factors is not exhaustive. The forward-looking statements contained in this document are made asof the date of this document or the dates specifically referenced herein. For additional information please refer to Tidewater’s public filings available onSEDAR at www.sedar.com. All forward-looking statements contained in this document are expressly qualified by this cautionary statement.
Any financial outlook or future-oriented financial information, as defined by applicable securities legislation, has been approved by management ofTidewater as of October 31, 2017. Such financial outlook or future-oriented financial information is provided for the purpose of providing information aboutmanagement's current expectations and goals relating to the future of Tidewater. Readers are cautioned that reliance on such information may not beappropriate for other purposes.
Non-GAAP Financial Measures
This presentation refers to “EBITDA” and “cash available for distribution” (CAFD), which do not have any standardized meaning prescribed by generallyaccepted accounting principles in Canada (“GAAP”). EBITDA is calculated as income or loss before interest, taxes, depreciation and amortization. We define“cash available for distribution” (CAFD) as the amount of cash generated from operations, before changes in working capital and after deducting sustainingcapital expenditures, scheduled principal repayments of debt and distributions to non-controlling interests.
For more information with respect to financial measures which have not been defined by GAAP, including reconciliations to the closest comparable GAAPmeasure, see the "Non–GAAP and Additional Measures" section of Tidewater’s most recent MD&A which is available on SEDAR.
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Track Record of Success
Previous two companies generated 20x returns for shareholders (Predator Midstream Ltd. and Predator Oil Ltd.)
High Growth, Pure Play NGL Infrastructure Business
Pursuing Canadian natural gas liquids (“NGLs”) and natural gas market opportunities through the acquisition and build out of strategic midstream, pipeline, processing, storage, rail, downstream, and export assets. NGL prices are currently at 24 month highs which is very positive for Tidewater’s business plan
Announced 15 year take-or-pay agreement with TransAlta on a new pipeline build from Tidewater’s largest natural gas processing facility (Brazeau River Complex (“BRC”)) direct to an end market in TransAlta’s large power plants in the Edmonton area. Key final step in a complete “Inter-Alberta” pipeline system where producers in Western Canada can flow on Tidewater infrastructure from wellhead all the way to a large end market
Recently announced sanctioning of 100 MMcf/day Pipestone Montney Sour Deep Cut Natural Gas Gathering and Natural Gas Liquids Processing Complex with two anchor five year take-or-pay contracts
Capitalizing on Management’s strong producer and downstream market access relationships, Tidewater can guarantee producers improved pricing for their NGLs
> 14 acquisitions announced/completed since IPO and realized on opportunity to purchase key midstream assets in strategic locations at deeply discounted valuations
Nine consecutive quarters of EBITDA growth
EBITDA increased from zero at IPO to current run rate of ~$65 million with visibility to ~$120 million in late 2019 while maintaining a strong balance sheet with Debt to EBITDA of 2.5-3.0x when capital projects come online
Targeting > 20% annualized EBITDA/share growth over next 24 months
Physical assets providing natural cashflow hedge with natural gas storage and extraction plant assets generating significant EBITDA in low gas price environment
Established three core areas in strategic locations (Deep Basin, Montney and Edmonton)
With recently announced “Inter-Alberta” pipeline network Tidewater has connectivity from the Montney, to the Deep Basin and into Edmonton and continuing to focus on increased connectivity
Tidewater continues to expand its Montney core area with recently announced 100 MMcf/day Pipestone Montney Sour Deep Cut Gas Plant which will be connected to its Pipestone Montney infrastructure/egress hub
Deep Basin currently Tidewater’s largest core area where activity is at-all time highs. Tidewater currently building out 50 MMcf/day expansion at the BRC due to demand for a cost of $10 million
Proven Capital Project Execution
Commissioned 10,000 bbl/day HD2 propane fractionation facility and relocation of turbo expander to BRC ahead of schedule and on-budget on industry leading timeline of 7 months and capital cost of $25 million for 10,000 bbl/day fractionation facility and $15 million to relocate and integrate turbo expander into the BRC
Tidewater Summary
4
Tidewater is a High Growth Midstream Company
NGL Connectivity Strategy
Acquire Strategic
Contracted
Infrastructure
Own key NGL/gas infrastructure and gas plants
with proximity to multiple transportation
options, coupled with take-or-pay and/or
reserve dedication agreements
Tidewater “Inter-Alberta” pipeline network backed
by 15 year take-or-pay with TransAlta. Offers
producers direct connectivity from wellhead,
through Tidewater’s extensive processing network
direct to an end market
Recently sanctioned 100 MMcf/day Pipestone
Montney Sour Deep Cut Gas Gathering and Natural
Gas Liquids Complex which will connect to
Tidewater’s Pipestone Infrastructure and egress hub
which is connected to TCPL, Alliance and natural gas
storage. Anchored by two five year take-or-pay
contracts
Optimize Through
Organic Investments
Enable Tidewater to own a strategic integrated
value chain from well head to end market
and/or tidewater
Significant opportunities within acquired assets to
continue to generate incremental EBITDA at > 20%
IRR
Recent acquisition includes large diameter pipelines
in both Montney and Deep Basin core areas and
create new egress options for producers
Increase Capabilities of
Infrastructure
Increase third party throughput and/or
improve liquids capture/pricing of NGLs for all
related parties
Commissioned 10,000 bbl/d fractionation facility on
industry leading timeline and cost in 7 months for
$25 MM
Relocation of existing acquired and idled turbo
expander and commenced expansion at BRC
Aggressively adding connectivity between three core
areas in the Montney, Deep Basin and Edmonton
assets
Enhance Logistics
Network & Market
Access Infrastructure
Various logistics infrastructure including rail,
pipelines and trucking
Various port and pipeline infrastructure to get
egress to export markets
100 railcar NGL facility at Edmonton constructed on
time and on budget
Tidewater continues to build out network which
includes proven natural gas storage in both the
Montney and Deep Basin
1
2
3
4
5
Very Conservative
Capital Structure Maintaining a low-risk and highly flexible capital
structure
Visibility to ~$120 million of EBITDA in late 2019
while maintaining a strong balance sheet with
Debt to EBITDA of 2.5x-3.0x when capital
projects come online
Private equity capital eager to pay a premium to
have ownership in Western Canadian
infrastructure
Minimal debt vs. comparable average of 5.1x,
payout ratio of ~25% vs. average of ~70%
Underlying Stable Cash
Flow Producing
Infrastructure Assets
Protection obtained from customers, contracts,
competitive positioning to ensure go forward
cash flow
> 75% of EBITDA backed by take-or-pay
contracts, long term agreements and/or reserve
dedications and will improve significantly into
2019 with 2 large projects anchored by long-
term take-or-pay contracts including 15 year
take-or-pay with an investment grade
counterparty
Continue to increase long term contracts and
diversify to customers with strong balance
sheets
Recently sanctioned Pipestone Montney Sour
Deep Cut Plant anchored by 2 five year take-or-
pay contracts
Growing EBITDA, CFPS
and Share Value
Taking advantage of ongoing acquisition and
organic growth opportunities to increase per
share value via creativity of management team
Since the April 2015 IPO, EBITDA increased from
zero to current proforma exit 2017 EBITDA of
~$80 million to late 2019 of ~$120 million
Relatively Undervalued
versus Comparable
Companies
Currently trading at an overly large discount to
the comparables given more conservative capital
structure and more easily achieved relative
growth rates
EV/EBITDA multiple of 7.2x vs. peer average of
14.3x
... That Currently Provides a Low-Risk Attractive Investment
Opportunity
Attractive Investment Opportunity
1
2
3
4
66
Tidewater Facilities and Connectivity
77
Overview of Montney Assets and Recently Sanctioned Pipestone
Montney Sour Deep Cut Gas Processing Complex
Montney Processing Facilities & Pipelines
Recently sanctioned 100 MMcf/day Pipestone Sour Deep Cut Natural Gas Gathering and Natural Gas Liquids Processing Complex with two anchor five year take-or-pay contracts
$210 million capital cost online in mid 2019
In discussions with several producers for reserve/well/land dedications and starting to evaluate phase 2 of Pipestone Sour Deep Cut Gas Plant
Plan to connect to Tidewater infrastructure/egress hub which provides three natural gas egress options in TCPL, Alliance and natural gas storage
Anchor tenants have option to acquire combined 35% working interest
Tidewater finished construction of phase one of its TransCanada and Alliance connected infrastructure and related natural gas liquids hub and natural gas storage project on-time and on-budget and is currently injecting natural gas into its natural gas storage facility
Tidewater closed NEBC Montney acquisition where it acquired 40% in an operating 30 MMcf/day sour plant in the heart of the Montney at Parkland as well as ~1,000 acres of surface land
Tidewater’s recent Wapiti Pipeline acquisition adds an operated 12 inch sour pipeline that could become a significant egress option for Montney producers
August 2017 Montney acquisition includes various working interests in 150 km of pipelines in the Jedney, Blair and Altares area of NEBC, an interest in key sour gas processing and compression and approximately 50 net sections of prospective Montney rights in the Altares area of NEBC. Also included is a pipe connected condensate battery at Valhalla which includes 20,000 bbls of condensate storage
88
Overview of Deep Basin Assets
Deep Basin Processing Facilities & Pipelines
Recently announced “Inter-Alberta” pipeline will physically connect Tidewater’s largest gas processing complex (BRC) to a large new demand source in TransAlta’s Sundance and Keephills power plants and is anchored by a 15 year take-or-pay
Final step in a TWM network from wellhead to end market
Ability for expansion to ~ 300 Mmcf/day
Ability to connect Montney producers to new end market and avoid TCPL restrictions
Brazeau River Complex expansion is on time and on budget and activity is at all-time highs with NGLs at 24 month high prices
Tidewater recently consolidated to 100% ownership prior to recent plans to expand by 50 MMcf/day for $10 million due to customer demand
Tidewater recently increased a take-or-pay contract by 10 MMcf/day to 30 MMcf/day and also extended the term to December 2020 with an intermediate-sized producer
Commissioned 10,000 bbl/day fractionation facility, capable of HD2 propane, at the BRC 45 days ahead of schedule on industry leading timeline of 7 months and at a cost of $25 million
Tidewater commissioned 40 MMcf/day deep cut in May 2017 on an 8 month schedule for a cost of $15 million, significantly improving NGL recoveries at the BRC
Potential to connect newly acquired infrastructure to BRC and provide customers with new large scale egress solution
Tidewater has commenced injections into its proven natural gas reservoir and is currently injecting approximately 25 MMcf/day and exceeding expectations while offering producers an egress and improved natural gas price option at BRC
99
Overview of Edmonton Assets
Edmonton Processing Facilities & Pipelines
Tidewater has over 800 km of key pipelines and valuable right of ways at Edmonton, 600 acres of heavy industrial land at Edmonton/Fort Saskatchewan, and 3 key extraction plant licenses
Edmonton assets provide egress/takeaway options for natural gas and NGL production throughout the Deep Basin and Tidewater is now tied into some of the largest industrial consumers of natural gas in Western Canada
Over the next 2 to 3 years, Tidewater plans to build out its Edmonton Energy Hub on its 600 acres of heavy industrial land and improve connectivity to major hubs at Edmonton
Includes the potential for propylene and polypropylene production and/or iso-octane production as Tidewater has received several expressions of interest from various off-take and joint venture parties who Tidewater management has worked with in the past for these products
Tidewater anticipates a significant improvement in margins by eliminating third party rail transloading fees, eliminating trucking costs and reduced pipeline tariffs at the Acheson facility
Fort Saskatchewan Ethane Extraction plant successfully reactivated and online and on-time and on-budget at >100% IRR
In May 2017 closed the acquisition of a 70 MMcf/day deep cut facility and successfully reactivated the facility in July 2017 ahead of schedule and under budget
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Tidewater has a Solid Infrastructure Business With a Strengthening
Contracts and Customer Base Currently > 75% of EBITDA backed by take-or-pay contracts, long term agreements and/or reserve dedications with > 50
customers
Improving significantly into 2019 with 90% of EBITDA backed by take-or-pay contracts, long term agreements and/or reserve dedications
15 year take-or-pay with investment grade counterparty in TransAlta
Recently sanctioned Pipestone Montney Sour Deep Cut Complex anchored by 2 five year take-or-pay agreements
Top Customers Utilizing Tidewater Facilities
Facility Throughput (MMcf/d)
5
5
6
6
6
6
9
11
15
18
18
20
30
30
50
60
100
130
Producer #16
Producer #15
Producer #14
Producer #13
Producer #12
Producer #11
Producer #10
Producer #9
Producer #8
Producer #7
Producer #6
Producer #5
Producer #4
Producer #3
Producer #2
Producer #1
TCPL Extraction
TransAlta
Take-or-payReserve
DedicationYears Remaining
Yes No 15
Yes No 10+
Yes Yes 1
No Yes 10
Yes Yes 3
Yes No 5
Yes No 2
Yes Yes 5
Yes No 1
Yes No 5
No Yes n.a.
No Yes n.a.
Yes Yes 4
Yes No 2
Yes No 5
Yes No 10
Yes Yes 7
Yes No 5-10
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$54
$80
-
$24 $24 $26 $28 $28 $42
$42 $46 $49 $54 $54 $56 $58
$69 $71 $80 $80
$120
($5)
($25)($17)
($12) $20 $25
$55
($23) ($21)
$20 $50
($15)
($2)
$16
$66 $66
$150 $150
$300
($30)
($10)
$10
$30
$50
$70
$90
$110
$130
$150
$170
$190
$210
$230
$250
$270
$290
$310
$330
$350
IPO BRCAcquisition &
Financing
PipelineAcquisition
Peace RiverArch Gas Plant
Acquisition
Gas Plant &Propane
Acquisitions
Edmonton AreaInfrastrucutre
Acquisition
AltaGasAcquisition
$80.5 MMFinancing
Acheson Plant,Land andPipeline
Acquisition andRail Facility
BRC Infra.Acquisition
Remaining BRCInterest,Gathering
Pipelines, NatGas Storage
$69 MMFinancing
NEBCProcessing
Plant / NGLTrucking
Q4 ProcessingAgreement /
PembinaRestrictionsLifted / Fort
SaskatchewanReactivation /70 MMcf Deep
Cut + NGLPipeline
Acquisition &Reactivation
FractionationFacility &
Relocation ofTurbo
Expander /BRC Expansion
TransCanadaand AllianceConnected
Infrastructure
Acquisition Total RemainingCapital OverNext 18-24
Months
C$ M
illions
Positioned for Organic Growth Outperformance
EBITDA Growth
EBITDA from previously announced acquisitions
Total EBITDA
Net Debt
Pro Forma EBITDA
Capital Spent/
Required Capital$180 $8 $12 $22 $10 $87 n.a. $17 n.a. $20 $50 $6 $521
Current TWM Status
$200–$3602
1 Cash flow for forward looking net debt calculated as EBITDA less growth capex, maintenance capex and dividends.2 Capital spending dependent on whether partners exercise option to acquire working interest.
1
$15 $30 $13 $51
Balance sheet is well positioned to execute on organic growth opportunities
Focused on delivering annual > 20% EBITDA/share growth over next 24 months
Visibility to ~$120 million of EBITDA in late 2019 while maintaining a strong balance sheet with Debt to EBITDA of 2.5x-3.0x when capital projects come online
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Date Asset Type Buyer Seller DescriptionValue
($MM)
EBITDA
Multiple
Contract
Disclosure
11/9/2017 Crude Pipeline BlackRockNGL Energy Partners
SemGroup Corp
Glass Mountain Pipeline (SemGroup
50/NGL 50)$600 24.0x
ToP & Area
Dedication
10/2/2017 Crude Pipeline GIPEnergy & Minerals Group
Laredo Petroleum Medallion Pipeline (EMG 51/Laredo 49) $1,825 34.5x
Area
Dedication
8/1/2017 Gas Pipeline Blackstone Energy Transfer Partners 32.44% stake in Rover Pipeline $1,570 12.5x ToP
6/6/2017 Terminal SemGroup Alinda Capital Partners Houston Fuel Oil Terminal Company $2,100 15.0x ToP
4/17/2017 Gas G&P Blackstone EnCap Flatrock EagleClaw Midstream Ventures $2,000 26.7x Fee Based
2/9/2017Gas Gathering
SystemWilliams Partners Western Gas Partners
33.75% stake in Roma and Liberty
gathering systems through asset swap$155 16.5x -
High Multiple US Midstream Deals
Source: PLS, Company Filings, Equity Research, Credit Research.1 Reflects annualized cash flow currently as outlined on conference call. Transcript references high teens multiple with addition of Omega expansion project.2 Based on annualized 1H2017 adjusted EBITDA.3 Based on expected first year EBITDA (pro rata).4 Based on SemGroup guidance 2018E EBITDA.5 Based on 2017E EBITDA from Moody's analysis on May 30, 2017.6 Based on Q1-Q3 2016 annualized adjusted EBITDA.
1
4
5
6
2
3
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Stock Symbol TSX: TWM
Common Shares Outstanding ~329 million
Insider Ownership (Fully Diluted) ~5.0%
Market Capitalization1 $530 million
Net Debt $75 million
Enterprise Value $605 million
Total Midstream Processing
Capacity (gross/net) and Length of
Pipelines (gross/net)
>1.5 Bcf/day / >1 Bcf/day
>4,000 km / >3,000 km
Replacement Value of Midstream
Assets> $2.0 billion
Annual Dividend $0.04/sh.
Current Yield1 ~2.5%
Tidewater Corporate Profile
1 As at Dec. 4, 2017.
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Tidewater Midstream Trading Comparables
Source: Company reports and Bloomberg. Estimates based on consensus equity research.1 As at Dec. 4, 2017.2 Includes options and warrants using the Treasury Method.3 EV includes non-recourse debt and preferred shares.4 Based on consensus equity research estimates.5 Cash available for distribution (“CAFD”) defined as cash from operations less maintenance capex, preferred dividend, non-controlling interest
and amortization of debt payments.6 Total capitalization value based on book value of equity plus net debt.
Tidewater is trading at a large discount to comparables despite a more conservative capital structure
Tidewater’s EV/EBITDA multiple of 7.2x trades at a large discount to its peer mean of 14.3x EV/EBITDA
Tidewater Midstream Trading Comparables
18E / 17E Payout Net Debt /
Share Market Enterprise EBITDA EV / EBITDA Ratio Dividend CAFD Yield EBITDA Debt/ Credit
Company Price1
Cap.2
Value2,3
Growth4
2018E4
2018E4 Yield 2018E
4,52018E
4Total Cap.
6 Rating
($/Sh.) ($MM) ($MM) (%) (x) (%) (%) (%) (x) (%)
Enbridge Income Fund Holdings Inc. $29.19 $22,388 $38,011 16% 13.0x 71% 7.0% 9.9% 5.4x 51% Baa2
Pembina Pipeline Corp. $44.27 $22,425 $34,299 60% 14.3x 52% 4.9% 9.0% 4.2x 44% BBB
Inter Pipeline Ltd. $27.35 $10,386 $16,467 1% 14.7x 70% 6.1% 8.8% 5.4x 64% BBB+
AltaGas Ltd. $29.09 $5,059 $10,029 34% 17.1x 102% 7.5% 7.4% 7.2x 47% BBB
Keyera Corp. $35.41 $6,716 $8,637 28% 12.5x 55% 4.7% 8.6% 3.2x 50% n.a.
Mean 28% 14.3x 70% 6.1% 8.7% 5.1x 51%
Median 28% 14.3x 70% 6.1% 8.8% 5.4x 50%
Tidewater Midstream $1.61 $535 $610 30% 7.2x 21% 2.5% 12.0% 0.9x 15% n.a.