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The following is an excerpt from a S-1 SEC Filing, filed by KINDER MORGAN MANAGEMENT LLC on 2/20/2001.
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KINDER MORGAN MANAGEMENT LLC - S-1 - 20010220 - BUSINESS

BUSINESS DESCRIPTION

Kinder Morgan Energy Partners, L.P., a Delaware limited partnership with its common units traded on the New York Stock Exchange under the symbol "KMP," was formed in August 1992. Kinder Morgan Energy Partners, L.P. is the largest publicly-traded pipeline limited partnership in the United States and owns and operates the second largest products pipeline system based on volume delivered. Since February 1997, when current management assumed control of the operations of Kinder Morgan Energy Partners, L.P., quarterly common unit distributions have more than tripled from $0.315 per common unit to $0.95 per common unit. The operations of Kinder Morgan Energy Partners, L.P. are grouped into the following four reportable business segments:

- PRODUCT PIPELINES: Over 10,000 miles of pipelines and associated terminals delivering gasoline, diesel, jet fuel and natural gas liquids to various markets. Includes Pacific Operations, 51% of Plantation Pipe Line Company, North System, Cypress Pipeline, 32.5% of Cochin Pipeline System, 50% interest in Heartland Pipeline Company and transmix operations;

- NATURAL GAS PIPELINES: Includes Kinder Morgan Interstate Gas Transmission LLC, Kinder Morgan Texas Pipeline, L.P., a 66 2/3% interest in Trailblazer Pipeline Company, a 49% interest in Red Cedar Gathering Company, the Casper and Douglas gathering system, a 25% interest in Thunder Creek Gas Services LLC and a 50% interest in Coyote Gas Treating LLC;

- CO(2) PIPELINES: Transports via pipeline and markets CO(2) for use in enhanced oil recovery projects. Assets include 50% of Cortez Pipeline, Central Basin Pipeline, 81% of CRC Pipeline, 13% of Bravo Pipeline, 45% of McElmo Dome, 11% of Bravo Dome, and interests in four unitized fields in West Texas; and

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- BULK TERMINALS: Includes over 25 owned and operated bulk terminal facilities handling over 40 million tons of coal, petroleum coke and other bulk products annually.

GATX TRANSACTION

On November 30, 2000, Kinder Morgan Energy Partners, L.P. announced a definitive agreement with GATX Corporation to purchase GATX Corporation's domestic pipeline and terminal businesses for approximately $1.15 billion. Primary assets included in the transaction are:

- CALNEV PIPE LINE COMPANY: A 550-mile refined petroleum products pipeline system originating in Colton, California and extending to the Las Vegas, Nevada market;

- CENTRAL FLORIDA PIPELINE COMPANY: A 195-mile refined petroleum products pipeline system consisting of a 16-inch gasoline pipeline and a 10-inch jet fuel and diesel pipeline, transporting product from Tampa to the Orlando, Florida market; and

- LIQUIDS TERMINALS: 12 liquids terminals with a storage capacity of 35.6 million barrels, the largest of which are located in Houston, New York Harbor, Los Angeles and Chicago, with a total capacity of approximately 31.2 million barrels.

When the GATX transaction closes, CALNEV Pipeline Company, Central Florida Pipeline Company and those terminals located on the West Coast will be included in our Product Pipelines segment. The remaining terminals will comprise a new business segment called Liquids Terminals.

BUSINESS STRATEGY

Management's objective is to grow Kinder Morgan Energy Partners, L.P. by:

- focusing on stable, fee-based assets which are core to the energy infrastructure of growing markets;

- increasing utilization of assets while controlling costs;

- leveraging economies of scale from incremental acquisitions; and

- maximizing the benefits of the financial structure of Kinder Morgan Energy Partners, L.P.

Since February 1997, Kinder Morgan Energy Partners, L.P. has announced 20 acquisitions valued at over $4.7 billion. These acquisitions and associated cost reductions have assisted Kinder Morgan Energy Partners, L.P. in growing from $17.7 million of net income in 1997 to $278.3 million of net income in 2000. Kinder Morgan Energy Partners, L.P. regularly considers and enters into discussions regarding potential acquisitions, including those from Kinder Morgan, Inc. or its affiliates, and is currently contemplating potential acquisitions. While there are currently no unannounced purchase agreements for the acquisition of any material business or assets, such transactions can be effected quickly, may occur at any time and may be significant in size relative to Kinder Morgan Energy Partners, L.P.'s existing assets or operations.

Kinder Morgan Energy Partners, L.P. primarily transports and/or handles products for a fee and generally is not engaged in the purchase and resale of commodity products. As a result, Kinder Morgan Energy Partners, L.P. does not face significant risks relating directly to shifts in commodity prices.

Kinder Morgan Energy Partners, L.P. has four business segments.

In the Product Pipelines segment, management plans to continue to expand its presence in the rapidly growing refined products markets in the western and southeastern United States through incremental expansions and complementary acquisitions.

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In the Natural Gas Pipelines segment, management plans to focus on cost reductions, expansions and storage opportunities as well as to identify and serve significant customers with demand for capacity on its pipeline systems.

In the CO(2) Pipelines segment, management plans to continue to implement its strategy in the Permian Basin of offering customers "one-stop shopping" for carbon dioxide supply, transportation and technical support service. Outside the Permian Basin, management plans to compete aggressively for new supply and transportation projects.

In the Bulk Terminals segment, management plans to grow its bulk terminals business through selective acquisitions, expansions, and the development of new terminals.

After the GATX acquisition closes, some of the acquired terminals will form a fifth business segment called Liquids Terminals.

KINDER MORGAN, INC.

Since the merger of the parent of the general partner of Kinder Morgan Energy Partners, L.P. and KN Energy, Inc. on October 7, 1999, Kinder Morgan, Inc. has strengthened its position as one of the largest midstream energy companies in the United States. Kinder Morgan, Inc.'s assets include:

- NGPL: Kinder Morgan, Inc.'s NGPL segment includes Natural Gas Pipeline Company of America, a 10,000 mile pipeline system that serves the key Chicago market and the states of Illinois, Iowa, Wisconsin, Indiana, Missouri, Arkansas and Texas. In 2000, the NGPL segment contributed $342.9 million of Kinder Morgan Inc.'s operating income.

- RETAIL: These operations provide retail natural gas distribution service for approximately 225,000 residential, commercial, industrial and agricultural customers in Colorado, Nebraska and Wyoming. In 2000, Kinder Morgan, Inc.'s Retail segment contributed $49.7 million of Kinder Morgan, Inc.'s operating income.

- POWER AND OTHER: These operations include two 550 MW natural gas power plants in construction outside Little Rock, Arkansas and Jackson, Michigan and interests in three plants in Colorado and other operating assets not included in other segments. In 2000, the Power and Other segment contributed $31.3 million of Kinder Morgan, Inc.'s operating income.

- KINDER MORGAN ENERGY PARTNERS, L.P.: As Kinder Morgan Energy Partners, L.P.'s distributions per unit increase, so does total cash flow received by Kinder Morgan, Inc., through its indirect general partner interest and its limited partner interest in Kinder Morgan Energy Partners, L.P. Kinder Morgan Energy Partners, L.P. generated $149.9 million in cash for Kinder Morgan, Inc. for the year 2000.

The principal executive offices of Kinder Morgan, Inc. and Kinder Morgan Energy Partners, L.P. are located at One Allen Center, Suite 1000, 500 Dallas Street, Houston, Texas and the phone number at this address is (713) 369-9000.

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ORGANIZATIONAL STRUCTURE

The following chart depicts our pro forma organizational structure and operating relationship with Kinder Morgan, Inc. and Kinder Morgan Energy Partners, L.P. following the offering.

[CHART]

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BROKERAGE PARTNERS