El Paso Pipeline Partners, L.P. (NYSE: EPB) today announced its quarterly cash distribution per common unit of $0.65 ($2.60 annualized) payable on May 15, 2014, to unitholders of record as of April 30, 2014. This represents a 5 percent increase over the first quarter 2013 cash distribution per unit of $0.62 ($2.48 annualized) and is the same as the fourth quarter 2013 distribution.
Chairman and CEO Richard D. Kinder said, “EPB had a solid first quarter with total asset earnings before DD&A of $319 million, which is slightly higher than the $317 million generated for the same period last year. Results were driven by contributions from the Elba Express Company (EEC) expansion project, which was placed in service in April 2013, along with strong performance at Colorado Interstate Gas Company (CIG).” First quarter earnings were impacted by the previously announced rate case settlements that resulted in lower rates on the Southern Natural Gas (SNG) and Wyoming Interstate Company (WIC) pipelines.
“For 2014, we anticipate continued consistent earnings from EPB’s stable, natural gas pipeline, storage and LNG assets,” Kinder said. “We also expect to complete the previously announced dropdowns of certain assets from Kinder Morgan, Inc. (noted in the Outlook section), and we are progressing on our Elba Liquefaction project and expansions of SNG and EEC (see Other News). Looking ahead, EPB has more than $1.5 billion of expansion projects under contract with customers, which will benefit EPB unitholders in 2016 and beyond.”
EPB reported first quarter distributable cash flow of $163 million compared to $169 million for the same period in 2013. Distributable cash flow per unit was $0.75 compared to $0.78 for the first quarter last year, and first quarter net income was $173 million compared to $174 million for the same period in 2013.
As previously announced, EPB expects to declare cash distributions of $2.60 per unit for 2014, a 2 percent increase over the $2.55 per unit it distributed for 2013. EPB’s 2014 budget includes the expected purchase (dropdown) of a 50 percent interest in Ruby Pipeline, a 50 percent interest in Gulf LNG and a 47.5 percent interest in Young Gas Storage from KMI. The positive impact from the expected dropdowns at attractive multiples will be largely offset by the full year impacts of the SNG and WIC rate case settlements and expected lower rates on contract renewals on the WIC system.