By Everdeen Mason
Kinder Morgan Inc. (KMI) said it expects a strong financial
performance for 2014 after its Kinder Morgan Energy Partners (KMP)
unit completed a major tanker acquisition this year.
Kinder Morgan Energy completed its acquisition of American
Petroleum Tankers and closely related State Class Tankers from
private-equity firms Blackstone Group LP and Cerberus Capital
Management LP for $962 million. Through the acquisition, the
pipeline-and-storage company has gained a number of crude oil
tankers that are engaged in marine transportation for U.S. domestic
trade.
As a result, Kinder Morgan Energy expects a cash distribution of
$5.58 a unit, up 5% from its 2013 distribution of $5.33 a unit.
The energy affiliate has benefited from strong production at
U.S. alternative shale fields, while Asian demand for steelmaking
coal has supported performance at its coal-export terminals.
The company also cited Tennessee Gas Pipelines's increased
number of north-to-south firm transportation contracts and
additional long-term contracts on its El Paso Natural Pipeline
system.
The El Paso Pipeline Partners LP (EPB) affiliate is expected to
declare cash distributions of $2.60 a unit in 2014, 2% higher than
its 2013 distribution.
Chief Executive Richard D. Kinder said Friday that the company
has also identified $14.8 billion in expansion and joint-venture
investments that should add to the company's earnings.
Kinder Morgan reported its earnings rose significantly in the
fourth quarter after its Kinder Morgan Energy unit offset weaker
earnings at El Paso Pipeline.
Kinder Morgan shares rose five cents to $31.01 in premarket
trading. As of Thursday's close, the stock is down 16% in the past
12 months.
Write to Everdeen Mason at everdeen.mason@wsj.com
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