#1PROJECT BRONCO CONFIDENTIAL DISCUSSION MATERIALS March 30, 2018 TOKE Confidential BAIRD#2TABLE OF CONTENTS CONFIDENTIAL DISCUSSION MATERIALS VAP Process Update Water Earn-Out Discussion Case Study: Tallgrass Simplification Appendix A. Cost of Capital Analysis 1 Confidential BAIRD A 1 2 3 Page 1#3PROCESS UPDATE Confidential#4PROCESS UPDATE Process updates since March 22 kick-off meeting 1 Accessed and reviewed the online data room established by Antero. Data room includes: Intercompany agreements Structural steps memo for AMGP acquisition of AM - - AR stand-alone forecast AM / AMGP stand-alone forecast Summary of AMGP-AM merger model - Confidential 2 Initiated interaction with Antero on follow-up model questions and additional data and diligence requests 3 Initiated analytical modeling and valuation analyses Project Bronco BAIRD Page 2#5PROCESS UPDATE (CONT.) Draft timeline of priority milestones; workstreams to be added as necessary Key Milestone: Formal Due Diligence Session Water Earn-Out Analysis Intrinsic Valuation Analysis (AR, AM, AMGP) AMGP - AM Transaction Alternatives Analyses - AMGP Acquisition of AM AMGP Acquisition of Ownership Interest in AM AR Return of Capital Strategic Review AR Share Buybacks AR Dividend Payment Other Analyses as Process Dictates March 30 2 9 April 16 23 30 T 7 14 May ** 21 28 Confidential 4 11 June Project Bronco BAIRD 18 25 Page 3#6WATER EARN-OUT DISCUSSION Confidential#7SUMMARY TERMS OF WATER EARN-OUT AND MVCS AR is considering a proposal whereby AM would accelerate the earn-out payment associated with the 2015 water drop-down In September 2015, AR sold its integrated water business to AM for $1.05 billion, plus an additional $250 million subject to the following Earn-Out provisions: Payment of $125 million at year-end 2019 upon AM delivering 161 Mbbld of average volume from 2017-2019 Payment of $125 million at year-end 2020 upon AM livering 200 Mbbld of average volume from 2018 - 2020 Ear-Out Period 36-month Period Ending 12/31/19 36-month Period Ending 12/31/20 Payment to AR (SMM) 2016 2017 2018 2019 $125 $125 MVC (Mbbld) Earn-out Threshold (Mbbld) 90 100 120 120 161 200 As of Sept. 2015 Projected 123 153 Avg. Volumes (Mbbld) 179 222 Projected Volumes (Mbbld) 178 204 Earn-Out % of Proj. Volumes Source: Management Base Case projections as of March 23. Represents Management Base Case projections as of August 2015 used in conjunction with Baird's engagement with AR Special Committee. 90% 90% Confidentiat ■ In addition to the Earn-Out provisions, AR also agreed to the following minimum volume commitments ("MVCs"): Actual Volumes (Mbbld) MVC % of Volumes 73% 65% 67% 59% Current Projected Avg. Volumes (Mbbld) 178 201 Earn-Out % of Proj. Volumes 90% 100% BAIRD Project Bronco Page 4#8PROJECTED WATER DELIVERY VOLUMES Utilizing Antero Midstream Base Case Forecast FORECASTED WATER DELIVERY VOLUMES (Bbld) 300,000 250,000 200,000 150,000 100,000 50,000 0 Management 153,129 153,129 100 000 2017A 177,892 Street 186,763 120,000 2018E === MVC Amounts 204,255 213,910 120.000 2019E 219,541 250,921 2020E FORECAST VERSUS EARN-OUT (Bbld) Management 2019 Earn-out Threshold: 161,000 Source: Management Base Case projections as March 23, 2017; Wall Street estimates per March 22 J.P. Morgan presentation to AR Special Committee. 178,425 184,601 2019 Earn-Out 11% Confidential Street Earn-out Threshold 2020 Earn-out Threshold: 200,000 200,563 2020 Earn-Out % above Earn-Out Threshold 15% 0% BAIRD 217,198 Project Bronco Page 5#9KEY CONSIDERATIONS IN "PRICING" THE EARN-OUT ACCELERATION AR Perspective AM Perspective ■ Probability of achieving earn-out volume thresholds based on AR drilling plan Confidential Ability to control water volume usage to meet thresholds At what price is AR better off receiving ($250 - X) today or waiting to receive the full $250 later, relative to the risk profile of the asset? In addition to taking a discount, what other concessions could AR be asked to make? Can AR redeploy the capital at an attractive rate of return relative to the discount? Probability of achieving earn-out volume thresholds based on AR drilling plan AR's ability to control water volume usage to meet thresholds At what price is AM better off paying ($250-X) today or waiting to repay the full $250 later, relative to the risk profile of this debt-like liability? In addition to receiving a discount, what other concessions will AM request? - What is AM's opportunity cost of capital, being mindful the high probability the full earn-out payment becomes due? Project Bronco BAIRD Page 6#10EARN-OUT DISCOUNT ANALYSIS COST OF CAPITAL ANALYSIS (¹) 12.0% Based on its risk characteristics, the earn-out payment should be priced along the cost of capital continuum for AR and AM From AR's perspective, a reasonable "Upper Bound" would be equivalent to its implied cost of equity, especially considering its most likely use of proceeds will be to support a potential share buy-back program From AM's perspective, a reasonable "Lower Bound" would be equivalent to its overall weighted average cost of capital PV OF EARN-OUT PAYMENT ($MM) (2) Implied Discount Rate Payment 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Cost of Debt 11.0% 9.0% 4.4% Cost of Equity Antero WACC 9.0% 8.0% | Papa a ma ka ma na m Source: Management Base Case projections as March 23, 2017. (1) Based on AR and AM cost of capital analyses (see Appendix for detail) (2) Assumes a present value date of May 1, 2018 4.0% Antero Midstreamtare un Upper Bound } Lower Bound 12.0% 11.0% 10.5% ***** 10.0% 9.5% 9.0% 8.5% 8.0% 7.5% 7.0% Confidential $196 $200 $202 $203 $205 $208 $210 $212 $214 $216 BAIRD Project Bronco Page 7#11POTENTIAL ADDITIONAL AR CONCESSIONS 1 Extend MVC to 2020 VOLUMES FORECAST (Mbbld) 250 200 150 100 50 2 0 153 ======== Earn-Out Part 1 (2019) 100 Earn-Out Part 2 (2020) 2017A 178 2017-2019 178,425 120 2018E Mgmt. Forecast 200,563 2018-2020 Mgmt. Forecast 204 120 ▬▬▬▬ILI 2019E Source: Management Base Case projections as March 23, 2017. Barrel "Miss" (000's) % miss Implied Payment ($MM) Barrel Miss (000's) % miss Implied Payment ($MM) 220 2020E Reimburse AM for volume shortfalls below earn-out thresholds 10 6% $14 10 5% $14 20 11% $28 20 EBITDA ($ in millions) 10% $28 $300 $250 $200 $150 $100 $50 $0 30 17% $42 30 $171 15% $42 Total Water EBITDA $111 2017A 40 22% $56 40 $57 $207 2018E 50 28% $70 $140 50 25% $71 $245 60 34% $84 60 MVC Water EBITDA 30% $85 Confidentia! $144 2019E 70 39% $98 Depending on the negotiated earn-out payment discount, AR would have to miss its forecast by nearly 50% to be at risk in this construct 70 $268 35% $99 2020E 80 45% $112 80 40% $113 BAIRD Project Bronco 200 MVC 150 MVC 120 MVC 90 50% $126 90 45% $127 Page 8#12CASE STUDY: TALLGRASS SIMPLIFICATION Confidential#13CASE STUDY: TALLGRASS SIMPLIFICATION TRANSACTION OVERVIEW ■ Tallgrass Energy announced an agreement for Tallgrass Energy GP, LP ("TEGP") to acquire Tallgrass Energy Partners ("TEP") - - TEP public unitholders (¹) will receive 2.0 TEGP Class A shares for each outstanding TEP common unit Represents a 10% premium to TEP based on each security's 30- day VWAP prior to the Feb. 7 restructuring announcement TEGP announced a 33% increase in the quarterly distribution Proposed transaction will result in no distribution cut to TEP unitholders, and will be accretive to TEGP shareholders and TEP unitholders Pro forma entity will be taxed as a C-Corp Taxable transaction to TEP public unitholders, who will own 62% of the publicly-traded Class A shares of TGE FEB. 7 RESTRUCTURING ANNOUNCEMENT 66 "Tallgrass is evaluating potential reorganization transactions that could, among other things, streamline and simplify TEP and TEGP's organizational structure, improve its equity cost of capital, improve its debt cost of capital and facilitate financing of its current and future growth opportunities." KEY TEGP & TEP STATISTICS (at Feb. 7) TEP Current Yield ¹18-¹20 EBITDA CAGR ¹18-¹20 DPU CAGR 2018E Distribution Coverage % of 2018E Cash Flow to IDRs Net Debt / LTM EBITDA TEGP TEGP Current Yield TEGP DPU '18 - ¹20 CAGR Confidential Premium to TEP: Last close (2/06/18) 10-day VWAP (2/6/18) 30-day VWAP (2/6/18) Implied transaction value (³); Source: Tallgrass acquisition press release and presentation dated March 26, 2018. (1) Excludes 25.6 million units owned by Tallgrass Equity, LLC. (2) Current TEGP shareholders will own 58.1 MM shares (~21% interest). Current TEP unitholders will own 95.2 MM shares (-34% interest). Adjusted for 65% of LP units acquired, 1.13% GP interest, assumed net debt of $2.1 billion and assumed noncontrolling interests of $69 million. Consensus Wall Street estimates. TRANSACTION METRICS (prior to Feb. 7 announcement) Consideration per TEP unit TEGP, last close (2/06/18) Exchange ratio Total consideration $23.40 2.0x $46.80 Price $43.99 $44.86 $45.59 BAIRD 8.8% 2.8% 6.9% 1.2x 37% 3.0x Project Bronco 6.3% 8.2% % Premium 6.4% 4.3% 2.6% $5,679 Page 9#14CASE STUDY: TALLGRASS SIMPLIFICATION (CONT.) Structural Overview PRE-SIMPLIFICATION -58,1mm Class A Shares (-31% interest) TEP Public Investors TEGP Public Investors 47.6mm LP Units (-65% LP Management, EMG, Kelso, and Minority Investors 126.7mm Class B Shares (69% non-economic interest) Tallgrass Energy GP, LP (NYSE: TEGP) -58.1mm units (31% economic interest) Tallgrass Equity LLC ("Tallgrass Equity") 25.6mm LP Units (-35% LP interest), 1.1% GP interest, IDRS Tallgrass Energy Partners, LP (NYSE: TEP) Operating Subsidiaries 25.01% interest +126,7mm units (-69% economic interest) REX POST-SIMPLIFICATION -153.2mm Class & Shares (-55% interest) (3) Source: Tallgrass acquisition press release dated March 26, 2018. Current TEGP shareholders will own 58.1 MM shares (-21% interest), Current TEP unitholders will own 95.2 MM shares (-34% interest). TGE Public Investors Confidential Management, EMG, Kelso, and Minority Investors 126,7mm Class B Shares (-45% non-economic interest) Tallgrass Energy, LP (NYSE: TGE) 100% interes -153.2mm units (55% economic interest) Tallgrass Equity LLC ("Tallgrass Equity") Tallgrass Energy Partners, LP Operating Subsidiaries (including 75% of REX) BAIRD 126.7mm units (-45% economic interest) Project Bronco | Page 10#15APPENDIX Confidential#16Cost of Capital Analysis#17AR E&P STAND-ALONE: WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS ($ in millions) Debt Outstanding (7) Cost of Equity (1) (2) (3) (5) (6) (7) (8) (9) Risk-free Interest Rate (¹) (2) Levered Beta Market Premium Size Premium Cost of Equity (5) (3) Source: AR and AM filings and Bloomberg Represents estimated 20-year treasury rate as of March 29, 2018. Two-year daily levered equity beta as of March 29, 2018. Revolving Credit Facility 5.375% Senior Notes Due 2021 5.125% Senior Notes Due 2022 5.625% Senior Notes Due 2023 5.000% Senior Notes Due 2025 Cost of Debt Amount Outstanding $185 1,000 1,100 750 600 $3,635 2.9% 1.0 6.9% 1.0% 10.9% Interest (6) Rate 2.8% 4.0% 4.4% 4.8% 4.8% 4.4% Large company stock total returns minus long-term government bond income returns as computed by Duff & Phelps LLC. Source: Duff & Phelps LLC size premium. Weighted Average Cost of Capital (8) AR Market Equity / Implied Firm Value AR Target Net Debt / Implied Firm Value Weighted Contribution from Market Equity Weighted Contribution from Debt Weighted Average Cost of Capital Capitalization % of Debt Cost of equity is calculated using CAPM (e.g. cost of equity risk-free interest rate + levered equity beta* market risk premium + size premium). Interest rate for publicly-traded senior notes represents the yield-to-worst as of March 29, 2018. Excludes current debt outstanding for Antero Midstream. Excludes value of Antero Midstream common units held by Antero Resources, tax effected at 20%. Net debt represents a target long-term 2.0x Net Debt/LTM EBITDA ratio, Confidential 35.0% 30.0% 25.0% 8.3% 8.6% 8.9% (9) Cost of Equity 10.0% 10.5% 10.9% 11.5% 8.0% 8.3% 8.6% BAIRD 68.0% 32.0% 7.4% 1.4% 8.8% 12.0% 8.6% 9.0% 9.3% 9.0% 9.3% 9.7% 9.3% 9.7% 10.1% Debt capitalization as a percent of implied firm value is sensitized between 25.0 % -35.0% and cost of equity is sensitized 10.0% -12.0% Baird will sensitize using WACC ranges from 8.0% to 10.1% Project Bronco | Page 11#18AM WEIGHTED AVERAGE COST OF CAPITAL ANALYSIS ($ in millions) Cost of Equity Debt Outstanding (1) (2) (3) (4) (5) (6) Risk-free Interest Rate (2) Levered Beta Market Premium (4) Size Premium Cost of Equity (5) (3) (1) Revolving Credit Facility 5.375% Senior Notes Due 2024 Cost of Debt Source: AM filings and Bloomberg. Represents estimated 20-year treasury rate as of March 29, 2018. Two-year daily levered equity beta as of March 29, 2018 Amount Outstanding $555 650 $1,205 2.9% 0.8 6.9% 1.0% 9.0% Interest (6) Rate 2.8% 5.0% 4.0% Confidentia! Weighted Average Cost of Capital AM Market Equity / Implied Firm Value AM Net Debt / Implied Firm Value Weighted Contribution from Market Equity Weighted Contribution from Debt Weighted Average Cost of Capital Capitalization % of Debt 25.0% 20.0% 15.0% Large company stock total returns minus long-term government bond income returns as computed by Duff & Phelps LLC. Source: Duff & Phelps LLC size premium. Cost of equity is calculated using CAPM (e.g. cost of equity risk-free interest rate + levered equity beta market risk premium size premium). Interest rate for publicly-traded senior notes represents the yield-to-worst as of March 29, 2018, Cost of Equity 9.0% 8.0% 8.5% 7.0% 7.4% 7.2% 7.6% 7.4% 7.8% 8.3% 7.8% 8.0% 9.5% 8.1% 8.4% 8.7% BAIRD 80.1% 19.9% 7.2% 0.8% 8.0% 10.0% 8.5% 8.8% 9.1% Debt capitalization as a percent of implied firm value is sensitized between 15.0 %-25% and cost of equity is sensitized 8.0% -10.0% Baird will sensitize using WACC ranges from 7.0% to 9.1% Project Bronco | Page 12