Investor update march 2016 website

Investor Update March 2016

NYSE: PSX www.phillips66.com

Cautionary Statement

2

This presentation contains forward-looking statements. Words and phrases such as “is anticipated,” “is estimated,” “is expected,” “is planned,” “is scheduled,” “is targeted,” “believes,” “intends,” “objectives,” “projects,” “strategies” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements relating to the operations of Phillips 66 and Phillips 66 Partners LP (including joint venture operations) are based on management’s expectations, estimates and projections, their interests and the energy industry in general on the date this presentation was prepared. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements can be found in filings by Phillips 66 and Phillips 66 Partners LP with the Securities and Exchange Commission. Phillips 66 and Phillips 66 Partners LP are under no obligation (and expressly disclaim any such obligation) to update or alter their forward-looking statements, whether as a result of new information, future events or otherwise. This presentation includes non-GAAP financial measures. You can find the reconciliations to comparable GAAP financial measures at the end of the presentation materials or in the “Investors” section of the websites of Phillips 66 and Phillips 66 Partners LP.

27 36 42

33 28

2012 2013 2014 2015 2016 YTD

17 14 13 17

9

2012 2013 2014 2015 2016 YTD

Market Dynamics

3

112 109 99 52 31

2012 2013 2014 2015 2016 YTD

Brent ($/bbl)

82 90 89

45 34

2012 2013 2014 2015 2016 YTD

NGL Weighted Average (cpg) PE Cash Chain Margin (cpp)

Global Market Crack ($/bbl)

See appendix for footnotes.

Strategy

4

Operating Excellence

Growth

Returns

Distributions

High-Performing Organization

9.7

7.4 7.8 8.5

2012 2013 2014 2015Refining M&S Chemicals DCP Midstream


Adjusted EBITDA ($B)

Operating Excellence

5

0.0

0.5

1.0Industry Average

Total Recordable Rates (Incidents per 200,000 Hours Worked)

’12 ’13 ’14 ’15

Refining Environmental Metrics

Refining Capacity Utilization (%)

Operating Costs and SG&A ($B)

Phillips 66 CPChem DCP


5.7 5.7 5.8 5.6

0.3 0.4

2012 2013 2014 2015

Growth

430 317 300 279

2012 2013 2014 2015

93% 93% 94% 91%

3% 3% 4% 5%

2012 2013 2014 2015

Planned Maintenance & Turnarounds

Value Chains

6

Midstream Organic Growth

7

EBITDA ($B)

Sweeny Midstream Hub Sweeny Fractionator One and Clemens Caverns in operation 4Q 2015 Freeport LPG Export Terminal startup 2H 2016

DAPL/ETCOP Commercial operations expected to begin 4Q 2016

Beaumont Terminal projects 2.5 MMBbls new crude/products tanks planned by 2H 2016

Bakken JVs (PSXP) Sacagawea Pipeline expected startup 2H 2016

Bayou Bridge System (PSXP) Lake Charles segment operational 1Q 2016 St. James segment targeted in-service 2H 2017

0.3

1.1 0.9

0.7

0.4

1.2

2.3

PSXPCurrent

Run-RateEBITDA

PSXOperating

Assets

ProjectsUnder

Construction

Planned 2018ERun-RateEBITDA

EBITDA in

PSXP

EBITDA Remaining

at PSX

DCP EBITDA excluded. See appendix for additional footnotes.

Phillips 66 Partners LP

8

Strategic relationship with PSX

Stable and predictable cash flows

Low cost capital source

Financial Flexibility

DCP Midstream

9

Natural Gas Total Throughput (Tbtu/d)

7.1 7.1 7.3 7.1

2012 2013 2014 2015

NGL Production (MMBD)

402 426 454 410

2012 2013 2014 2015

Strengthened balance sheet

Significant self-help initiatives Cash flow breakeven reduction from 60 to 35 cpg NGL Operating improvements Contract realignment System rationalization Capital discipline

90% investment-grade end-use customers

Expected to be self-funding

No DCP Midstream debt maturities until 2019

Global Chemicals Demand

10

Global Ethylene Demand and Utilization (MM Metric Tons and %)

Source: Wood Mackenzie.

Petrochemical demand driven by global economic growth

Demand outpaced capacity additions

129 134 137 141

86.1% 86.6% 86.9% 87.7%

2012 2013 2014 2015Demand Operating Rate

0

150

300

450

600

750

900

1,050

1,200

0 15 30 45 60 75 90 105 120 135 150

Chemicals Production Costs

11

M.E. Ethane

N.A. Ethane N.A. LPG

M.E. LPG/Naphtha

W. Europe Naphtha

N.A. Naphtha

W. Europe LPG

Asia Naphtha Asia LPG/Ethane

Cumulative Capacity MM Tons

2015 vs 2014 Average Ethylene Production Cost Curve ($/ton)

Petrochemical production costs reduced globally

CPChem location-advantaged feedstock position continues

Rest of World

Asia Coal CPChem

Source: Wood Mackenzie.

2014 2015

CPChem Growth

12

USGC Petrochemicals Project 1,500 kMTA (ethylene) at Cedar Bayou, TX 1,000 kMTA (polyethylene) at Old Ocean, TX Planned startup mid-2017 $1 B estimated EBITDA

Healthy pipeline of self-funded growth opportunities

Expect increased distributions post USGC project completion

EBITDA estimate is on a CPChem 100% basis and is based on January 2016 IHS forecast premises.

Refining

13


2.0 1.6 2.4

2013 2014 2015

FCF ($B)

Strong free cash flow

Increased demand for refined products

Expansive footprint provides opportunities for Midstream growth

9.9 9.9 11.8

2013 2014 2015

Global Realized Margin ($/bbl)

Refining

14

Adjusted ROCE (%)

12 12 19

2013 2014 2015

0.9 1.2 1.2 1.4

2013 2014 2015 2016E

Sustaining Return WRB

Total Capex ($B)

Investing to improve returns Quick payout, low cost projects

Wood River projects Dilbit capacity increase, ULSD expansion, FCC modernization

$200 MM capex, $100 MM EBITDA

Bayway FCC modernization $150 MM capex, $75 MM EBITDA

Billings heavy crude project $300 MM capex, $125 MM EBITDA


Marketing & Specialties

15

Increased U.S. gasoline sales volumes by 7%

Upgraded 300 U.S. branded sites

Increased U.K. inland gasoline placement by 11%

Added 31 new retail sites in Germany and Austria

Third largest U.S. finished lubricants supplier


0.9 1.0 1.0

2013 2014 2015

FCF ($B)

Adjusted ROCE (%)

28 32 35

2013 2014 2015

5.0 4.4

5.8

0.5

1.5

5.1 5.0

7.2

2013 2014 2015

Adjusted CFO PSXP Contributions

Financial Strength

16

Available Cash ($B)

Dividends Sustaining Capex

Strong balance sheet

Investment-grade credit rating

Disciplined capital allocation

20% net debt/cap

$3.1 B cash

$5 B revolving credit facility


Capital Allocation

17

Funding reinvestment Cash from operations PSXP proceeds

Returning capital to shareholders Dividend growth Ongoing share repurchases

Distributions Reinvestment

2014 – 2016E


Capital Spending

3.5

5.6

7.7

5.3

2013 2014 2015 2016E

Consolidated WRB DCP CPChem

1.8

3.8

5.8

3.9

2013 2014 2015 2016E

Refining M&SPSXP MidstreamInvestment in DCP Corporate

Consolidated ($B)

Capital Program ($B)

18


Distributions

19

1.33 1.89 2.18

2013 2014 2015

Annual Dividend ($/sh)

Cumulative Distributions ($B)

3.7

8.4 11.1

2013 2014 2015Share Repurchases and Exchanges Dividends

Double-digit dividend growth

37% dividend CAGR since spin

Ongoing share repurchase program

110 MM shares repurchased and exchanged

$2.6 B authorization remaining

Cumulative distributions include distributions since July 2012. See appendix for additional footnotes.

Compelling Investment

20

Shareholder returns

Disciplined capital allocation

Unique portfolio

EBITDA growth

Multiple expansion

-20%

20%

60%

100%

140%

180%

220%

May-12 Feb-13 Nov-13 Aug-14 May-15 Feb-16

PSX +165%

S&P 100 +47%

Peers +37%

Institutional Investors Contact Rosy Zuklic

General Manager, Investor Relations

C.W. Mallon Manager, Investor Relations

[email protected] 832-765-2297

Investor Update March 2016

NYSE: PSXP www.phillips66partners.com

Phillips 66 Partners Ownership Structure

Phillips 66 Partners GP LLC (PSXP General Partner) General Partner Units

IDRs

Operating Subsidiaries

PSXP Public Unitholders

(NYSE: PSX)

(NYSE: PSXP)

100% ownership interest

29% limited partner interest

Joint Ventures

2% general partner interest

69% limited partner interest

23

Phillips 66 Partners

Strong alignment with Phillips 66

Highly integrated assets

Stable and predictable cash flows

Significant growth potential

Financial flexibility

Pecan Grove Marine Dock

24

Distribution Growth

0.2125 0.2248 0.2743 0.3017 0.3168 0.3400 0.3700 0.4000 0.4280 0.4580

3Q2013

4Q2013

1Q2014

2Q2014

3Q2014

4Q2014

1Q2015

2Q2015

3Q2015

4Q2015

Coverage Ratio 1.13x 1.10x 1.10x 1.44x 1.32x 1.28x 1.14x 1.15x 1.40x 1.44x

3Q 2013 distribution represents the minimum quarterly distribution, actual distribution of $0.1548 equal to MQD prorated.

25

Distribution / LP Unit ($)

37.2 41.9 47.8

64.5 74.0

4Q 2014 1Q 2015 2Q 2015 3Q 2015 4Q 2015

Financial Performance

Adjusted EBITDA ($MM)

43.7 49.0 57.0

73.4 87.1

4Q 2014 1Q 2015 2Q 2015 3Q 2015 4Q 2015

Distributable Cash Flow ($MM)

Adjusted EBITDA and Distributable Cash Flow shown are attributable to PSXP.

26

Phillips 66 Partners 1Q 2016 Drop Down

27

Assets include a 25% controlling interest in: Sweeny Fractionator – 100MBD NGL fractionator Clemens NGL Caverns – 7.5MMBbl NGL storage facility

Total transaction value of $236 MM funded with: $24 MM take-back equity of PSXP LP and GP units $212 MM sponsor loan payable to PSX

2016E full-year EBITDA of $25 MM

Long-term, take-or-pay contracts with Phillips 66 for the full capacity of the assets

$25 MM EBITDA is attributable to PSXP interest.

$314 MM Announced 2016 Organic Growth Plan Bayou Bridge Pipeline Transports crude from Nederland, TX to Lake Charles, LA, and St. James, LA Increases crude supply options for LA refineries Expected completion of Lake Charles leg in 1Q 2016 Expected completion of St. James segment in 2H 2017

Sacagawea Pipeline 76-mile Sacagawea Pipeline and central delivery facility for gathering systems Connection into 100 MBD Palermo crude oil rail-loading facility Provides increased logistics options for shippers in the Bakken region Terminal completed in 4Q 2015; pipeline expected startup 2H 2016

Sand Hills Pipeline Adding lateral connections and increasing pumping capacity

28

Highly Integrated and Diversified Asset Portfolio

29

Fee-based, Long-term Contracts Provide Stability

Hartford Connector includes PSX JV Wood River Refinery to Hartford and Hartford to Explorer pipelines. The term of the Hartford Connector throughput and deficiency agreement began in January 2008.

Asset Initial Term (years)Maximum Term with

Options (years)

Clifton Ridge to Lake Charles 10 20Sweeny to Pasadena 10 20Hartford Connector 23 23Gold Line 10 15Sand Hills 15 15Southern Hills 15 15Cross Channel Connector 5 -Eagle Ford Gathering 7 -Explorer Various Various

Clifton Ridge Terminal 5 20Clifton Ridge / Pecan Grove Docks 5 20Pasadena Terminal 5 20Pasadena and Hartford Truck Racks 5 20Gold Line Terminals 5 15Medford Spheres 10 20Bayway Rail Rack 10 20Ferndale Rail Rack 10 20

Sweeny Fractionator 10 -Clemens Caverns 10 -

Existing Pipelines

25% PSXP

PSX accounted for 96% and 95% of PSXP’s transportation and terminaling revenues in 2015 and 2014, respectively

Existing Terminals / Storage

Remaining weighted average contract life

of ~10 years

Remaining weighted average contract life

of ~5 years

30

Balanced Debt Profile

0.3

0.5

0.3

2020 2025 2045

$1.1 B debt issuance February 2015 5-Year $300 MM notes, 2.646% coupon 10-Year $500 MM notes, 3.605% coupon 30-Year $300 MM notes, 4.680% coupon

Average cost of 3.64%

BBB (stable) / Baa3 (stable)

Debt Maturity Profile ($B)

31

Financial Flexibility

Investment-grade credit rating

Financial targets:

30% distribution CAGR 2013-2018

3.5x debt / EBITDA

1.1x annual coverage ratio

Support Phillips 66 Midstream growth

32

-100%

-60%

-20%

20%

60%

100%

140%

180%

220%

260%

300%

Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16

Closed 2nd acquisition -

$340 MM

Total Return Since IPO

Closed 1st acquisition -

$700 MM

PSXP 158% Alerian MLP Index -45%

IPO Closed 3rd

acquisition - $1.1 B

Closed 4th acquisition –

$70 MM

Chart reflects total unitholder return July 22, 2013 to February 12, 2016. Distributions assumed to be reinvested in units. Source: Bloomberg.

33

Institutional Investors Contact Rosy Zuklic – General Manager, Investor Relations [email protected] | 832-765-2297 C.W. Mallon – Manager, Investor Relations [email protected] | 832-765-2297

Appendix

Segment Strategy

36

Refining: Enhance Returns Midstream: Growth Chemicals: Growth

Marketing & Specialties:

Selective Growth Execute Sweeny Hub

Grow integrated transportation system

PSXP as a funding vehicle

Pursue organic and M&A opportunities

Grow CPChem organically

Advance olefins and polyolefins projects

Capitalize on domestic feedstock advantage

Leverage proprietary technology

Optimize crude slate

Expand export capability

Increase yields

Maintain cost discipline

Enhance portfolio

Expand European retail marketing

Grow lubricants

Ensure domestic refinery pull-through

Midcontinent Integrated Growth

37

Midstream Palermo rail terminal/Sacagawea pipeline (PSXP) DAPL/ETCOP

Refining, Marketing & Specialties Ponca City

Yield improvement project Tight oil processing flexibility 100% lease crude purchases

Wood River Dilbit capacity increase ULSD expansion FCC modernization

Billings Vacuum tower project

Marketing & Specialties Grow branded fuels volumes Enhance Phillips 66 brand Marketing JVs and alliances

Western Gulf Creating a World-Class Energy Complex

38

Midstream Sweeny Fractionator One (25% PSXP)

Freeport LPG export terminal

Eagle Ford crude pipeline

Sweeny Fractionator Two

Refining, Marketing & Specialties Sweeny

Strategic asset integration


Grow unbranded fuels volumes Focus on high-quality branded assets Increase high-margin exports

Eastern Gulf Refining Logistics and Midstream Growth

39

Midstream

Beaumont terminal expansion: +7 MMBbls

Bayou Bridge pipeline

Alliance clean products dock

Refining, Marketing & Specialties Lake Charles

Increase feedstock advantage

Alliance Increase light crude runs


Grow unbranded fuels volumes Leverage brand value through licensing Increase high-margin exports Grow performance lubricants and export sales

West Coast Enhancing Returns

Midstream Los Angeles waterborne crude tank

Santa Maria rail rack

Refining, Marketing & Specialties San Francisco

Yield improvements

Los Angeles FCC energy reduction

Marketing & Specialties Grow branded and unbranded fuels volumes Enhance 76 brand Increase high-margin exports Grow export lubricant sales

40

Atlantic Basin Enhancing Returns

Midstream

Bayway LPG loading facility

Refining, Marketing & Specialties

Bayway FCC reactor modernization Yield improvements

Marketing & Specialties Grow JET and COOP brands in Europe Increase unbranded volumes in the U.K. and U.S. Expand brand licensing in the U.S.

41

Historical Performance

42

Adjusted EBITDA and Adjusted Earnings are adjusted for special items Adjusted EBITDA adjusted for non-controlling interest and proportional share of equity affiliates’ income taxes, net interest and D&A Adjusted CFO is cash from continuing operations and excludes working capital changes

Adjusted EBITDA

($B) Adjusted Earnings

($B) Adjusted CFO

($B)

0.5

2.2

4.6 5.4 5.1

4.5

5.9

2009 '10 '11 '12 '13 '14 '15

0.5

1.7

3.5

5.3

3.6 3.8 4.2

2009 '10 '11 '12 '13 '14 '15

2.2

4.0

7.0

9.7

7.4 7.8

8.5

2009 '10 '11 '12 '13 '14 '15

Free Cash Flow 2013 – 2015 Average

43

1.0 1.4

0.7 0.3

Adjusted CFO & PSXPContributions

Sustaining Capex Available Cash Flow

1.1 0.9

0.2

CFO Sustaining Capex FCF

Midstream ($B) Chemicals ($B)

CFO excludes working capital. Sustaining capex excludes capital leases. Midstream adjusted CFO excludes PSXP. PSXP contributions are calculated as consideration paid by PSXP to PSX in dropdown transactions plus quarterly cash distributions paid from PSXP to PSX. Midstream sustaining capex excludes PSXP. DCP Midstream, CPChem and WRB free cash flow calculated based on Phillips 66’s share of after tax cash flow at the enterprise level.

2.9 2.0

0.9


1.0 0.9 0.1


Refining ($B) Marketing & Specialties ($B)

PSXP Contributions

35%

19%

19%

5%

M&S

Chemicals Refining

Midstream

-10%

0%

10%

20%

30%

40%

Average Capital Employed ($B)

Corporate

-8%

2015 Adjusted ROCE

44

P66 Total 14%

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32

Capital Structure

45

20- 30%

Excluding PSXP

22.0 21.6 23.1

6.1 8.6 7.8

5.0 5.2 3.0

22% 28% 25%

2013 2014 2015

Equity $B Debt $B Cash & Cash Equivalents $B Debt to Capital

22.4 22.0 23.9

6.1 8.6 8.9

5.4 5.2 3.1

21% 28% 27%

2013 2014 2015

Consolidated PSX

3.0

8.0

5.0

Cash Undrawn RevolvingCredit Facility

TotalCommittedLiquidity

1.5 2.0

4.0 5.0

2016 2017 2018 2019 2020-30 2031-50

Bonds Revolving Credit Facility

Debt and Liquidity

46

Debt Maturity Profile ($B)

Liquidity ($B)

As of 12/31/2015. Excludes PSXP. Debt maturity profile excludes capital leases. Undrawn Revolving Credit Facility includes $5.0 B revolving credit facility less $51 MM in letters of credit.

2016 Sensitivities

47

Sensitivities shown above are independent and are only valid within a limited price range.

Phillips 66 Capital Program

48

Sustaining Growth Total Consolidated Capital Expenditures and InvestmentsMidstream(1) 227 2,119 2,346 Chemicals - - - Refining 833 384 1,217 Marketing and Specialties 57 80 137 Corporate(2) 180 - 180

1,297 2,583 3,880

Select Equity Affiliates(3)

DCP 98 125 223 CPChem 241 775 1,016 WRB 129 55 184

467 956 1,423

Capital Program(3)

Midstream 324 2,244 2,568 Chemicals 241 775 1,016 Refining 962 439 1,401 Marketing and Specialties 57 80 137 Corporate 180 - 180

1,764 3,539 5,303

Millions of Dollars2016 Budget

(3) Includes Phillips 66’s portion of self-funded capital spending by DCP Midstream, CPChem, and WRB.(2) Includes non-cash capitalized lease of $3 million in Corporate(1) Includes 100% of Phillips 66 Partners

1Q 2015 Phillips 66 Partners Acquisition

Drop-down assets 33.3% interest in Sand Hills NGL pipeline 33.3% interest in Southern Hills NGL pipeline 19.5% interest in Explorer refined products pipeline

$1.1 B acquisition Asset-level 2015E EBITDA of $115 million Implied 9.5x purchase multiple on assets’ 2015E EBITDA

Assets supported by long-term, fee-based agreements, primarily under take-or-pay terms

Additional organic growth opportunities through identified expansion projects

49

Footnotes

50

Slide 3 2016 YTD data is through February 18, 2016 unless otherwise noted. Global Market Crack refers to worldwide market crack spread based on Phillips 66 global crude capacity. NGL weighted average prices are based on index prices from the Mont Belvieu and Conway market hubs that are weighted by DCP Midstream, LLC’s (DCP’s) NGL component and location mix. PE cash chain margins are ethylene to high-density polyethylene cash chain margins. 2016 YTD is January average pricing. Source: IHS, Inc. Slide 4 Corporate not included in bars on chart, but included in totals. Adjusted EBITDA adjusted for non-controlling interest and proportional share of selected equity affiliates’ income taxes, net interest and D&A.

Footnotes

51

Slide 5 Injury statistics do not include major projects. Industry Averages are from: Phillips 66 – American Fuel & Petrochemical Manufacturers (AFPM) refining data, Chevron Phillips Chemical Company LLC (CPChem) – American Chemistry Council (ACC), DCP – Gas Processors Association (GPA). Growth component of operating costs is estimated based on growth initiatives post-2013. Slide 7 PSX operating assets EBITDA includes Refining Logistics. Refining Logistics represents terminaling, storage and other logistics assets currently embedded in the Refining segment. Amount represents an estimate of the EBITDA potential of these assets if they were transferred to Midstream and market-based fees for their use were charged to the Refining segment. Projects under construction and planned EBITDA growth is 2018 estimated run-rate EBITDA of projects completed 2016 or later. PSXP EBITDA includes EBITDA attributable to non-controlling interests. Planned EBITDA includes projects that have not yet reached final investment decision.

Footnotes

52

Slide 13 FCF is CFO less sustaining capital, excluding working capital. WRB Refining LP (WRB) free cash flow is calculated based on P66’s share of after tax cash flow at the enterprise level. Global realized margin is based on total processed inputs and includes proportional share of refining margins contributed by certain equity affiliates. Realized margin excludes special items. Slide 14 Wood River Projects capex and EBITDA shown at 100% WRB. Refining capex excludes capital leases but includes Phillips 66’s portion of self-funded capital spending by WRB. Project capex and annual EBITDA are estimated. Slide 15 FCF is CFO less sustaining capital, excluding working capital.

Footnotes

53

Slide 16 Net debt/cap and cash figures are consolidated. Revolving credit facility available includes $5.0 B revolving credit facility less $51 MM in letters of credit. Adjusted CFO excludes PSXP and excludes working capital. PSXP contributions are calculated as consideration paid by PSXP to PSX in dropdown transactions plus quarterly cash distributions paid from PSXP to PSX. Sustaining capex excludes capital leases and excludes PSXP. Slide 17 Reinvestment excludes Phillips 66’s portion of self-funded capital spending by DCP, CPChem and WRB. Includes $1.5 B equity contribution to DCP in 2015. Distributions include the 2014 PSPI share exchange. Slide 18 Capital program includes Phillips 66’s portion of self-funded capital spending by DCP, CPChem and WRB.

Footnotes

54

Slide 19 2014 share repurchases and exchanges include the PSPI share exchange. Slide 20 Chart reflects total shareholder return May 1, 2012 to February 18, 2016. Dividends assumed to be reinvested in stock. Source: Bloomberg. Peer average includes Delek US Holdings, Inc., HollyFrontier Corporation, Marathon Petroleum Corporation, PBF Energy Inc., Tesoro Corporation, Valero Energy Corporation, Western Refining, Energy Transfer Equity, L.P., Enterprise Products Partners L.P., ONEOK, Inc., Targa Resources Corp., Celanese Corporation, The Dow Chemical Company, Eastman Chemical Company, Huntsman Corporation, LyondellBasell Industries NV, and Westlake Chemical Corporation.

Non-GAAP Reconciliations

55

Adjusted EBITDA by Segment Reconciliation 2012 2013 2014 2015

Midstream (excluding DCP Midstream) Midstream net income attributable to Phillips 66 (127) 259 372 337 Plus:

Net income attributable to noncontrolling interests 7 17 35 61 Provision for income taxes (71) 142 230 212 Depreciation and amortization 83 88 91 127

Midstream (excluding DCP Midstream) EBITDA (108) 506 728 737

Adjustments (pretax):EBITDA attributable to Phillips 66 noncontrolling interests (13) (24) (45) (73) Proportional share of selected equity affiliates income taxes - - - - Proportional share of selected equity affiliates net interest - - - - Proportional share of selected equity affiliates depreciation and amortization - - - - Lower-of-cost-or-market inventory adjustments - - - - Gain on asset dispositions - - - - Gain on share issuance by equity affiliate - - - - Impairments 523 - - - Pending Claims and settlements (37) - - - Hurricane-related costs 2 - - - Pension settlement expense - - - 9

Midstream (excluding DCP Midstream) Adjusted EBITDA* 367 482 683 673

* Proportional share of selected equity affiliates is net of noncontrolling interests.

Millions of Dollars


Proportional Share of DCP MidstreamProportional Share of DCP Midstream net income attributable to Phillips 66 179 210 135 (324) Plus:

Net income attributable to noncontrolling interestsProvision for income taxes 100 122 79 (139) Depreciation and amortization - - - -

Proportional Share of DCP Midstream EBITDA 279 332 214 (463)

Adjustments (pretax):EBITDA attributable to Phillips 66 noncontrolling interestsProportional share of selected equity affiliates income taxes - 4 3 (2) Proportional share of selected equity affiliates net interest 85 110 118 133 Proportional share of selected equity affiliates depreciation and amortization 131 139 150 166 Lower-of-cost-or-market inventory adjustments - - 2 - Gain on asset dispositions - - - (30) Gain on share issuance by equity affiliate - - - - Impairments in equity affiliates - - - 366 Pending Claims and settlements - - - - Hurricane-related costs - - - -

Proportional Share of DCP Midstream Adjusted EBITDA* 495 585 487 170

* Proportional share of selected equity affiliates is net of noncontrolling interests.

Millions of Dollars


56


ChemicalsChemicals net income attributable to Phillips 66 823 986 1,137 962 Plus:

Provision for income taxes 366 375 495 353 Chemicals EBITDA 1,189 1,361 1,632 1,315

Adjustments (pretax):Proportional share of selected equity affiliates income taxes 79 93 111 91 Proportional share of selected equity affiliates net interest 13 10 9 7 Proportional share of selected equity affiliates depreciation and amortization 213 246 258 264 Impairments by equity affiliates 43 - 88 24 Premium on early debt retirement 144 - - - Lower-of-cost-or-market inventory adjustments - - 3 -

Chemicals Adjusted EBITDA 1,681 1,710 2,101 1,701

Millions of Dollars Adjusted EBITDA by Segment Reconciliation 2012 2013 2014 2015

RefiningRefining net income (loss) attributable to Phillips 66 3,091 1,747 1,771 2,555 Plus:

Provision for income taxes 1,998 1,035 696 1,104 Net interest expense - - - - Depreciation and amortization 655 685 704 738

Refining EBITDA 5,744 3,467 3,171 4,397

Adjustments (pretax):Proportional share of selected equity affiliates income taxes 5 (4) 3 (3) Proportional share of selected equity affiliates net interest (118) (95) (19) - Proportional share of selected equity affiliates depreciation and amortization 236 237 245 252 Net (gain) loss on asset dispositions (185) - (145) (8) Impairments 606 - 131 - Canceled projects - - - - Pending claims and settlements 31 - 23 30 Severence accruals - - - - Hurrican-related costs 54 - - - Tax law impacts - (22) - - Lower-of-cost-or-market inventory adjustments - - 40 53 Pension settlement expenses - - - 53

Refining Adjusted EBITDA 6,373 3,583 3,449 4,774

Millions of Dollars


57


Marketing and SpecialtiesMarketing and Specialties net income attributable to Phillips 66 544 894 1,034 1,187 Plus:

Provision for income taxes 319 433 441 465 Net interest expense - - - (2) Depreciation and amortization 147 103 95 97

Marketing and Specialties EBITDA 1,010 1,430 1,570 1,747

Adjustments (pretax):Asset dispositions (4) (40) (125) (242) Impairments - - - - Pending claims and settlements 62 (25) (44) - Exit of a business line - 54 - - Tax law impacts - (6) - - Pension settlement expenses - - - 11

Marketing and Specialties Adjusted EBITDA 1,068 1,413 1,401 1,516

Millions of Dollars Adjusted EBITDA by Segment Reconciliation 2012 2013 2014 2015

Corporate Corporate net income (loss) attributable to Phillips 66 (434) (431) (393) (490) Plus:

Net income attributable to noncontrolling interests - - - (8) Provision for income taxes (239) (263) (287) (231) Net interest expense 231 258 246 285 Depreciation and amortization 21 71 105 116

Corporate EBITDA (421) (365) (329) (328)

Adjustments (pretax):Impairments 25 - - - Repositioning Costs 85 - - - Pending claims and settlements - - - - Tax impacts - - - - Pension settlement expense - - - 7

Corporate Adjusted EBITDA (311) (365) (329) (321)

Millions of Dollars


58

2009 2010 2011 2012 2013 2014 2015Phillips 66 Phillips 66 net income attributable to Phillips 66 476 735 4,775 4,124 3,726 4,762 4,227 Less:

Income from discontinued operations 19 30 43 48 61 706 - Plus:

Net income attributable to noncontrolling interests 3 5 5 7 17 35 53 Provision for income taxes 357 562 1,822 2,473 1,844 1,654 1,764 Net interest expense (44) (41) (16) 231 258 246 283 Depreciation and amortization 873 874 902 906 947 995 1,078

Phillips 66 EBITDA 1,646 2,105 7,445 7,693 6,731 6,986 7,405

Adjustments (pretax):EBITDA attributable to Phillips 66 noncontrolling interests - (9) (10) (13) (24) (45) (73) Proportional share of selected equity affiliates income taxes 47 63 80 84 93 117 86 Proportional share of selected equity affiliates net interest (26) (6) (27) (20) 25 108 140 Proportional share of selected equity affiliates depreciation and amortization 557 540 584 580 622 653 682 Gain on asset dispositions (37) (234) (1,636) (189) (40) (270) (280) Gain on share issuance by equity affiliate (135) - - - - - - Impairments 129 1,512 506 1,197 - 131 - Impairments by equity affiliates - - - 88 390 Cancelled projects - 106 44 - - - - Severence accruals - 28 24 - - - - Exit of a business line - - - - 54 - - Pending claims and settlements 39 (56) - 56 (25) (21) 30 Premium on early debt retirement - - - 144 - - - Repositioning Costs - - - 85 - - - Hurricane-related costs - - - 56 - - - Tax law impacts - - - - (28) - - Lower-of-cost-or-market inventory adjustments - - - - - 45 53 Pension settlement expense - - - - - - 80

Phillips 66 Adjusted EBITDA 2,220 4,049 7,010 9,673 7,408 7,792 8,513

Millions of Dollars


59

Forecasted EBITDA We are unable to present reconciliations of the various forecasted EBITDA included in this presentation, because certain elements of net income, including interest, depreciation and income taxes, are not reasonably available. Together, these items generally result in EBITDA being significantly greater than net income.


60

2013 2014 2015Refining FCFNumerator Cash From Operations GAAP $ 3,700 1,374 2,770

Less: Change in Non-Cash Working Cap. 818 (1,599) (441) Cash From Operations (excluding WC) 2,882$ 2,973 3,211 Less: P66 Equity affiliate cash from ops 1,020 838 90 Add: Equity look through cash from ops 848 351 303

Adjusted FCF (excl WC) 2,710$ 2,486 3,424

Total Capex GAAP 820 1,038 1,069

Less: Growth Capex 166 265 189

Sustaining Capex 654$ 773 880 Less: P66 Equity affiliate sustaining capex - - - Add: Equity look through sustaining capex 94 118 151

Adjusted Sustaining Capex $ 748 891 1,031

Refining Free Cash Flow 1,962$ 1,595 2,393

Millions of Dollars


61

2013 2014 2015Refining ROCENumerator Net Income 1,747 1,771 2,554 After-tax interest expense - - -

GAAP ROCE earnings 1,747 1,771 2,554 Special Items (13) (195) (28) Adjusted ROCE earnings 1,734 1,576 2,526

DenominatorGAAP average capital employed* 13,940 13,377 13,582 Discontinued Operations - - - Adjusted average capital employed* 13,940 13,377 13,582

*Total equity plus debt.

Adjusted ROCE (percent) 12% 12% 19%GAAP ROCE (percent) 13% 13% 19%*Total equity plus debt.

Millions of Dollars


62

2013 2014 2015M&S FCFNumerator Cash From Operations GAAP $ 757 1,663 1,736

Less: Change in Non-Cash Working Cap. (217) 651 676 Cash From Operations (excluding WC) 974$ 1,012 1,060 Less: P66 Equity affiliate cash from ops - - - Add: Equity look through cash from ops - - -

Adjusted FCF (excl WC) 974$ 1,012 1,060

Total Capex GAAP 226 439 122

Less: Growth Capex 176 379 53

Sustaining Capex 50$ 60 69 Less: P66 Equity affiliate sustaining capex - - -

Add: Equity look through sustaining capex - - -

Adjusted Sustaining Capex $ 50 60 69

M&S Free Cash Flow 924$ 952 991

Millions of Dollars


63

2013 2014 2015M&S ROCENumerator Net Income 894 1,034 1,187 After-tax interest expense - - -

GAAP ROCE earnings 894 1,034 1,187 Special Items (9) (152) (239) Adjusted ROCE earnings 885 882 948

DenominatorGAAP average capital employed* 3,160 2,743 2,735 Discontinued Operations - - - Adjusted average capital employed* 3,160 2,743 2,735


Adjusted ROCE (percent) 28% 32% 35%GAAP ROCE (percent) 28% 38% 43%*Total equity plus debt.

Millions of Dollars


64

2013 2014 2015Phillips 66 Available Cash Cash From Continuing Operations GAAP 5,942$ 3,527 5,713 Less: Change in Non-Cash Working Cap. 880 (1,020) (221) Cash From Operations (excluding WC) 5,062$ 4,547 5,934 Less: PSXP cash from operations 24 100 176 Adjusted CFO 5,038$ 4,447 5,758 Add: PSXP contributions 20 536 1,478 Total Available Cash 5,058$ 4,983 7,236

Total Phillips 66 Sustaining Capex 1,028$ 1,095 1,186 Less: PSXP Sustaining Capex 3 12 8 Sustaining Capex excluding PSXP 1,025$ 1,083 1,178 Remaining capital expenditures 754 2,690 4,586 GAAP capital expenditures 1,779$ 3,773 5,764

Millions of Dollars


65

2009 2010 2011 2012 2013 2014 2015Phillips 66 Cash from Operations Cash From Continuing Operations GAAP 917$ 2,054 4,953 4,259 5,942 3,527 5,713 Less: Change in Non-Cash Working Cap. 393 (195) 314 (1,140) 880 (1,020) (221) Cash From Continuing Operations (excluding WC) 524$ 2,249 4,639 5,399 5,062 4,547 5,934

Millions of Dollars


66

2009 2010 2011 2012 2013 2014 2015Reconciliation of Earnings to Adjusted EarningsConsolidatedEarnings 476 735 4,775 4,124 3,726 4,762 4,227 Adjustments:

Gain on share issuance by equity affiliate (88) - - - - - - Asset dispositions (32) (116) (1,545) (106) (23) (494) (265) Impairments 116 1,118 318 979 - 131 - Impairments by equity affiliates - - - - - 69 256 Canceled projects - 29 28 - - - - Severance accruals - 28 15 - - - - Pending claims and settlements 25 (35) - 34 (16) (10) (23) Premium on early debt retirement - - - 89 - - - Repositioning costs - - - 55 - - - Exit of business line - - - - 34 - - Repositioning tax impacts - - - 177 - - - Certain tax impacts - - - - (17) - (84) Hurricane-related costs - - - 35 - - - Lower-of-cost-or-market inventoyr adjustments - - - - - 30 33 Pension settlement expenses - - - - - - 49 Discontinued operations (19) (30) (43) (48) (61) (706) -

Adjusted earnings 478 1,729 3,548 5,339 3,643 3,782 4,193

Millions of Dollars Except as Indicated


67

Midstream Chemicals RefiningMarketing & Specialties

FCFNumerator Cash From Operations GAAP 859$ 571 2,615 1,385 Less: Change in Non-Cash Working Cap. (46) 0 (407) 370 Cash From Operations (excluding WC) 905$ 571 3,022 1,015 Less: P66 Equity affiliate cash from ops 228 571 649 0 Add: Equity look through cash from ops 378 1,147 501 0 Adjusted FCF (excl WC) 1,055$ 1,147 2,874 1,015

Total Capex GAAP 2,409 0 976 262 Less: Growth Capex 1,750 0 207 203 Sustaining Capex 659$ 0 769 59 Less: P66 Equity affiliate sustaining capex 500 0 0 0 Add: Equity look through sustaining capex 125 209 121 0 Adjusted Sustaining Capex 284$ 209 890 59

PSXP Contributions 678$ - - -

Free Cash Flow 1,449$ 938 1,984 956

Average 2013-2015


68

Phillips 66 Midstream Chemicals RefiningMarketing & Specialties Corporate

ROCENumerator Net Income 4,280$ 74 962 2,554 1,187 (497) After-tax interest expense 201 - - - - 201 GAAP ROCE earnings 4,481 74 962 2,554 1,187 (296) Special Items (34) 235 (10) (28) (240) 9 Adjusted ROCE earnings 4,447$ 309 952 2,526 947 (287)

DenominatorGAAP average capital employed* 31,749$ 6,793 4,921 13,582 2,735 3,718 Discontinued Operations - - - - - - Adjusted average capital employed* 31,749$ 6,793 4,921 13,582 2,735 3,718


Adjusted ROCE (percent) 14% 5% 19% 19% 35% -8%GAAP ROCE (percent) 14% 1% 20% 19% 43% -8%*Total equity plus debt.

Millions of Dollars2015


69

Adjusted Phillips 66

Phillips 66 Partners

Phillips 66 Consolidated

2013Cash and cash equivalents 4,975 425 5,400 Total Debt 6,126 - 6,126 Total Equity 21,983 409 22,392 Debt-to-capital ratio 22% 21%

2014Cash and cash equivalents 5,199 8 5,207 Total Debt 8,617 18 8,635 Total Equity 21,622 415 22,037 Debt-to-capital ratio 28% 28%

2015Cash and cash equivalents 3,026 48 3,074 Total Debt 7,796 1,091 8,887 Total Equity 23,129 809 23,938 Debt-to-capital ratio 25% 27%

Millions of Dollars

PSXP Non-GAAP Reconciliations

70

Millionsof Dollars

Year ending February 29 2016Reconciliation of PSXP Estimated EBITDA to Estimated Net Income*Estimated net income 82$ Plus:

Depreciation 20Interest expense 4Income taxes 9

Estimated EBITDA 115$ *Amounts reflect the sum of EBITDA and net income forecasts within each joint venture, multipliedby PSXP's expected ownership interest.

1Q 2015 Phillips 66 Partners Acquisition

PSXP Adjusted EBITDA and Distributable Cash Flow Reconciliation to Net Income

$ MM 4Q 2015 3Q 2015 2Q 2015 1Q 2015 4Q 2014

Net Income $ 64.5 $ 52.3 $ 42.0 $ 35.4 $ 36.3 Plus: Depreciation 5.7 5.7 5.3 5.1 4.5 Net interest expense 9.2 9.1 9.5 5.8 2.1 Amortization of deferred rentals 0.1 0.1 0.1 0.1 0.1 Provision for (benefit from) income taxes 0.1 0.1 (0.1) 0.2 0.2

EBITDA 79.6 67.3 56.8 46.6 43.2 Distributions in excess of equity earnings 6.6 4.6 0.2 0.7 - Expenses indemnified or prefunded by Phillips 66 0.5 1.1 - 0.3 0.1 Transaction costs associated with acquisitions 0.4 0.4 - 1.4 1.0

EBITDA attributable to Predecessors - - - - (0.6) Adjusted EBITDA 87.1 73.4 57.0 49.0 43.7 Plus: Adjustments related to minimum volume commitments (1.7) 2.4 2.2 1.1 (2.4) Phillip 66 prefunded maintenance capital expenditures - - - - 0.1

Less: Net interest 9.2 9.1 9.5 6.5 1.4 Income taxes paid (refunded) (0.1) - 0.4 - - Maintenance capital expenditures 2.3 2.2 1.5 1.7 2.8

Distributable Cash Flow 74.0 64.5 47.8 41.9 37.2 71

Investor update march 2016 website

Investor Relations

Transcript of Investor update march 2016 website