Kinder Morgan highlights ethanol handling in Q2 results

By Erin Voegele | July 24, 2013

Kinder Morgan Energy Partners L.P. recently released financial results for the second quarter of 2013, announcing segment earnings are up significantly from the same period of 2012. 

“KMP had a strong second quarter as our stable and diversified assets continued to grow and produce incremental cash flow. Our five business segments produced approximately $1.337 billion in segment earnings before DD&A and certain items, up 39 percent from the second quarter of 2012,” said Richard Kinder, chairman and CEO of KMP.

Within the results, KMP highlighted business related to ethanol and biodiesel. Quarterly earnings for its Products Pipelines business segment were approximately $179 million, up 8 percent from the $166 million reported for the comparable period of 2012.

“The increase in earnings compared to the second quarter of 2012 was driven by our Transmix operations, which had higher volumes and improved margins,” Kinder said. “The Southeast Terminals also contributed to the boost in segment earnings, reflecting higher ethanol and butane blending revenues versus the same period last year.”

According to the report, total refined products volumes for the second quarter were up 3.5 percent compared to the second quarter of 2012. Overall segment gasoline volumes, including ethanol transported on the Central Florida Pipeline, were up 5.9 percent. Diesel volumes and jet fuel volumes also increased at lower rates.

KMP’s Products Pipelines segment handled more than 10.3 million barrels of biofuels during the second quarter, up 26 percent from the second quarter of 2012. The increase is attributed to the August 2012 acquisition of a biofuel transload terminal in South Carolina and biodiesel blending projects that came online this year.

However, KMP reported that its Terminals segment handled only 15.6 million barrels of ethanol during the quarter, down from 16.3 million barrels during the same period of 2012. The drop is attributed primarily to the conversion of the Richmond, Va., facility to crude and a contract termination.

Together, the Terminals segment and Products Pipelines segment handled 25.3 million barrels of ethanol, up from 24.1 million barrels reported during the second quarter of 2012. According to the quarterly report, KMP continues to handle approximately 30 percent of the ethanol used in the United States.