El Paso Pipeline Partners, L.P. (EPB)

[eastunder]

El Paso Pipeline Partners Increases Quarterly Distribution to $0.62 Per Unit

http://www.knobias.com/story.htm?eid=3.1.95c007ac1f6dfe9a09b0ce8cd68f6ca4c5f1b2d0696376e12afce62efab77721

Wednesday, April 17, 2013 16:07ET

Distribution Up 22 Percent From First Quarter 2012

HOUSTON--(BUSINESS WIRE)-- El Paso Pipeline Partners, L.P. (NYSE: EPB) today increased its quarterly cash distribution per common unit to $0.62 ($2.48 annualized) payable on May 15, 2013, to unitholders of record as of April 29, 2013. This represents a 22 percent increase over the first quarter 2012 cash distribution per unit of $0.51 ($2.04 annualized) and is up from $0.61 per unit ($2.44 annualized) for the fourth quarter of 2012. EPB has increased its cash distribution 20 consecutive quarters since its initial public offering in November 2007.

Chairman and CEO Richard D. Kinder said, "EPB had a solid first quarter with total asset earnings before DD&A and certain items of $317 million, up 12 percent from $283 million for the same period last year. Results were led by contributions from the May 24, 2012, dropdown from its general partner of the remaining 14 percent of Colorado Interstate Gas and all of Cheyenne Plains Pipeline, along with good results from Southern Natural Gas (SNG) attributable to a completed expansion project. Deliveries to gas-fired power generation were up 4 percent on SNG in the first quarter versus the same period a year ago, which also had experienced very strong growth in natural gas demand for power generation."

"Looking ahead, growth at EPB is expected to be driven by our stable, regulated natural gas pipeline and storage assets," Kinder said. "We are particularly excited about the significant LNG export opportunities we are pursuing, including our recent announcement with a subsidiary of Shell to build a natural gas liquefaction plant at our existing LNG terminal on Elba Island (see other news section)."

EPB reported first quarter distributable cash flow before certain items of $169 million, an 18 percent increase from $143 million for the comparable period in 2012. Distributable cash flow per unit before certain items was $0.78, compared to $0.69 for the first quarter last year.

First quarter net income before certain items was $177 million compared to $141 million for the same period in 2012. Including certain items, net income was $174 million versus $155 million for the first quarter last year.

2013 Outlook

As previously announced, EPB expects to declare cash distributions of $2.55 per unit for 2013, a 13 percent increase over the $2.25 per unit it distributed for 2012. EPB's budget includes the expected purchase (dropdown) of 50 percent of Gulf LNG from Kinder Morgan, Inc. (NYSE: KMI) during 2013.

In 2013, EPB expects to generate earnings before DD&A of $1.22 billion (adding back EPB's share of joint venture DD&A), an increase of over $40 million compared to 2012. Additionally, EPB expects to produce excess cash flow of approximately $25 million above the 2013 distribution target of $2.55.

Other News

-- In January, Southern LNG Company (SLNG), a subsidiary of EPB, and Shell
US Gas & Power LLC, a subsidiary of Royal Dutch Shell plc, announced
their intent to form a limited liability company to develop a natural
gas liquefaction plant in two phases at SLNG's existing Elba Island LNG
Terminal, near Savannah, Ga. Subject to regulatory approval, Shell and
SLNG will also modify EPB's Elba Express Pipeline and Elba Island LNG
Terminal to physically transport natural gas to the terminal and to load
the liquefied natural gas (LNG) onto ships for export by Shell. The
project has already received Free Trade Agreement (FTA) approval and has
applied for non-FTA approval. The construction of the first phase is not
contingent on FTA approval. Under two phases of development, the total
project is expected to have liquefaction capacity of approximately
2.5 million tonnes per year of LNG or approximately 350 million cubic
feet of gas per day. The company expects to file full project
applications with the Federal Energy Regulatory Commission (FERC) during
the fourth quarter 2013.
-- Gulf LNG, which EPB expects to purchase the 50 percent membership
interest from KMI later this year, is working with potential customers
on a project to build a future LNG liquefaction export terminal on a
site adjacent to its existing LNG import/regasification facility at
Pascagoula, Miss. In June 2012, the proposed LNG export project received
FTA approval for a 25-year period from the U.S. Department of Energy for
exporting up to 11.5 million tonnes per year of domestically produced
LNG, equivalent to approximately 1.5 billion cubic feet per day of
natural gas. The project has also applied for non-FTA approval.
-- Elba Express Pipeline completed the construction of a new 10,000
horsepower compressor station in Hart County, Ga., on schedule and
placed the station in service in early April. The station provides
customers with an additional 220 million cubic feet per day of capacity
and increased operational flexibility in transporting natural gas either
north or south on the 190-mile Elba Express Pipeline to serve the
proposed Elba Island liquefaction project. The company is also planning
an additional compression station for future installation along the Elba
Express Pipeline.


-- Wyoming Interstate Company (WIC) filed a cost and revenue study with
FERC at the end of January in order to comply with the commission's rate
proceeding that it initiated last year under Section 5 of the Natural
Gas Act. The as-filed cost and revenue study supports WIC's current
rates. If this matter is not resolved through settlement negotiations, a
hearing is scheduled in the third quarter of this year. The expected
outcome from this FERC action is not anticipated to have a substantial
impact on the overall earnings of EPB.


Financings

-- EPB sold common units valued at almost $22 million during the first
quarter under its at-the-market program.


El Paso Pipeline Partners (NYSE: EPB) is a publicly traded pipeline limited partnership. It owns an interest in or operates more than 13,000 miles of interstate natural gas transportation pipelines in the Rockies and the Southeast, natural gas storage facilities with a capacity of nearly 100 billion cubic feet and LNG assets in Georgia. The general partner of EPB is owned by Kinder Morgan, Inc. (NYSE: KMI). Kinder Morgan is the largest midstream and the third largest energy company in North America with a combined enterprise value of approximately $110 billion. It owns an interest in or operates approximately 73,000 miles of pipelines and 180 terminals. Its pipelines transport natural gas, gasoline, crude oil, CO2 and other products, and its terminals store petroleum products and chemicals and handle such products as ethanol, coal, petroleum coke and steel. KMI owns the general partner interests of Kinder Morgan Energy Partners, L.P. (NYSE: KMP) and El Paso Pipeline Partners, L.P. (NYSE: EPB), along with limited partner interests in KMP, Kinder Morgan Management, LLC (NYSE: KMR) and EPB. For more information please visit http://www.kindermorgan.com.