The CO 2 segment is an area where KMP is exposed to commodity price risk, but that risk is partially mitigated by a long-term hedging strategy intended to generate more stable realized prices. The realized weighted average oil price per barrel for the quarter, with all hedges allocated to oil, was $70.43 versus $59.54 for the same period in 2010. The realized weighted average NGL price per barrel for the quarter, allocating none of the hedges to NGLs, was $68.86 compared to $46.73 for the same period last year.

The Terminals business produced third quarter segment earnings before DD&A and certain items of $180.4 million, up 10 percent from $164.0 million for the comparable period in 2010, and is expected to come in slightly below its published annual budget of 10 percent growth.

“About three quarters of the growth in this segment was driven by organic sources compared to the third quarter of 2010, with the remainder coming from acquisitions,” Kinder said. “Internal growth was led by higher export coal volumes at Pier IX in Virginia and at our bulk facilities in Houston, as coal volumes handled across the company increased by 23 percent compared to the third quarter of 2010. We also realized increased ethanol throughput at the Argo facility in Chicago and higher results at Carteret in New York Harbor due to tank expansions.” Acquisitions that contributed to growth quarter over quarter included the Watco rail transaction (December 2010) and the purchase of the Port Arthur, Texas, terminal (June 2011) which handles petcoke for the Total refinery.

For the third quarter, this segment handled 15.5 million barrels of ethanol, up 10 percent from 14.1 million barrels for the comparable period last year. Combined, the terminals and products pipelines business segments handled about 23.5 million barrels of ethanol compared to 21.7 million barrels in the third quarter of 2010. For the first three quarters of this year, the terminals and products pipelines business segments combined handled about 67.9 million barrels of ethanol versus 66.6 million barrels in the comparable period a year ago. KMP continues to handle approximately 30 percent of the ethanol used in the United States.

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