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El Paso Pipeline Partners Increases Quarterly Distribution to $0.65 Per Unit



  El Paso Pipeline Partners Increases Quarterly Distribution to $0.65 Per Unit

              Distribution Up 12 Percent From Third Quarter 2012

Business Wire

HOUSTON -- October 16, 2013

El Paso Pipeline Partners, L.P. (NYSE: EPB) today increased its quarterly cash
distribution per common unit to $0.65 ($2.60 annualized) payable on Nov. 14,
2013, to unitholders of record as of Oct. 31, 2013. This represents a 12
percent increase over the third quarter 2012 cash distribution per unit of
$0.58 ($2.32 annualized) and is up from $0.63 per unit ($2.52 annualized) for
the second quarter of 2013. EPB has increased its cash distribution 22
consecutive quarters since its initial public offering in November 2007.

EPB reported third quarter total asset earnings before DD&A and certain items
of $286 million, down from $299 million for the same period last year.
Chairman and CEO Richard D. Kinder said, “EPB’s earnings declined compared to
the third quarter of 2012 primarily due to the impact of two recent rate case
settlements approved by the Federal Energy Regulatory Commission (FERC) that
have resulted in lower rates on the Southern Natural Gas (SNG) and Wyoming
Interstate Company (WIC) pipeline systems. Additionally, an unusually cool
summer coupled with gas prices that were higher than last year lowered demand
from natural gas-fired peaking power plants served by SNG. Results at Southern
LNG and Elba Express were higher than in the third quarter last year. Looking
ahead, EPB has identified approximately $1.1 billion in expansion and joint
venture investments, and we are pursuing customer commitments for additional
projects.”

EPB reported third quarter distributable cash flow before certain items of
$127 million, down from $149 million for the comparable period in 2012.
Distributable cash flow per unit before certain items was $0.58, compared to
$0.71 for the third quarter last year. Third quarter net income before certain
items was $141 million compared to $154 million for the same period in 2012.
Including certain items, net income was $141 million versus $151 million for
the third quarter last year.

For the first nine months, EPB generated distributable cash flow before
certain items of $425 million, down slightly from $427 million for the first
three quarters of 2012. Distributable cash flow per unit before certain items
was $1.96 versus $2.06 for the first nine months last year. Net income before
certain items was $456 million versus $426 million for the first three
quarters of 2012. Including certain items, net income was $451 million
compared to $411 million for the same period last year.

2013 Outlook

As previously announced, EPB expects to declare cash distributions of $2.55
per unit for 2013, a 13 percent increase over the $2.25 per unit it
distributed for 2012.

Other News

  * Permitting continues for the Elba Liquefaction Project at Elba Island near
    Savannah, Ga. In the second quarter, Southern LNG Company (SLNG) and Shell
    US Gas & Power executed final contracts for construction and operation of
    the proposed LNG liquefaction project. Phase one, anticipated to be in
    service in late 2016 or early 2017, is moving forward under approved Free
    Trade Agreement (FTA) status. An application is pending for authority to
    export LNG to non-FTA countries. The FERC has issued notice that it will
    prepare an environmental assessment for the added infrastructure at the
    Elba Island terminal. EPB’s estimated investment at the terminal in phase
    one is approximately $800 million.
  * SNG and Elba Express Company (EEC) will invest over $250 million to expand
    their systems following successful open seasons in August for incremental,
    long-term natural gas transportation service. The open seasons generated
    customer interest in incremental capacity of approximately 600,000
    dekatherms per day (Dth/d) that will support infrastructure growth in the
    southeastern United States and the needs of customers in Georgia, South
    Carolina and northern Florida.

       * The SNG expansion will create capacity on its South Main system and
         also provide subscribing customers firm north-to-south transportation
         service on the Elba Express Pipeline using firm transportation
         service being acquired by SNG in the EEC expansion. SNG anticipates
         placing the project in service in 2016 pending regulatory approvals.
       * The EEC expansion will create incremental north-to-south capacity,
         including interconnects and delivery points with SNG and other
         pipelines and shippers, designed to serve a new load created by the
         proposed Elba Liquefaction Project and other capacity needs along the
         Elba Express Pipeline. EEC customers have expressed interest in a
         later phase to the EEC project that could add incremental capacity
         approaching 400,000 Dth/d, which, if constructed, would bring the
         total capacity of the expansions to approximately 1 billion cubic
         feet per day. EEC expects an in-service date as early as June 2016
         pending regulatory approvals.

  * Construction continues in Mississippi on the Rose Hill Project, which
    involves facility modifications benefiting both SNG and Tennessee Gas
    Pipeline (TGP), a subsidiary of Kinder Morgan Energy Partners. The
    approximately $25 million SNG portion of the project will allow SNG
    customers to shift approximately 450,000 Dth/d from present receipt
    locations to receipt points farther west, including an interconnection
    between SNG and TGP. The approximately $9 million TGP portion of the
    project enhances the delivery capabilities from TGP to SNG. A Nov. 1,
    2013, in-service date is anticipated.
  * Construction is nearing completion for the WYCO High Plains Expansion
    Project, a joint venture between Colorado Interstate Gas (CIG) and Xcel
    Energy. The project will begin partial service on Nov. 1, 2013, with
    remaining service to begin in the spring of 2014 to coincide with the
    in-service of one of the customer’s facilities. CIG is constructing
    approximately 8 miles of 24-inch-diameter lateral pipeline and making
    other modifications to the High Plains Pipeline System to make it
    bi-directional, enhancing flexibility and transport capacity. The
    approximately $24 million High Plains expansion will provide additional
    takeaway capacity from the Denver-Julesburg Basin and links the basin with
    CIG’s High Plains system. Two shippers have signed long-term, firm service
    contracts for an initial 250,000 Dth/d.
  * On Oct. 1, FERC approved an uncontested Offer of Settlement filed in June
    by WIC to fully resolve FERC’s rate investigation under Section 5 of the
    Natural Gas Act initiated on Nov. 15, 2012. WIC’s approved settlement
    offer, agreed to by all active parties, provides for two-phase, base
    tariff rate reductions on July 1, 2013, and Jan. 1, 2014, as well as rate
    certainty for the parties during a three-year moratorium on new rates
    through July 1, 2016.

El Paso Pipeline Partners (NYSE: EPB) is a publicly traded pipeline limited
partnership. It owns an interest in or operates more than 13,000 miles of
interstate natural gas transportation pipelines in the Rockies and the
Southeast, natural gas storage facilities with a capacity of nearly 100
billion cubic feet and LNG assets in Georgia. The general partner of EPB is
owned by Kinder Morgan, Inc. (NYSE: KMI). Kinder Morgan is the largest
midstream and the third largest energy company in North America with a
combined enterprise value of approximately $110 billion. It owns an interest
in or operates more than 82,000 miles of pipelines and 180 terminals. Its
pipelines transport natural gas, gasoline, crude oil, CO[2] and other
products, and its terminals store petroleum products and chemicals and handle
such products as ethanol, coal, petroleum coke and steel. KMI owns the general
partner interests of Kinder Morgan Energy Partners, L.P. (NYSE: KMP) and El
Paso Pipeline Partners, L.P. (NYSE: EPB), along with limited partner interests
in KMP and EPB, and shares in Kinder Morgan Management, LLC (NYSE: KMR). For
more information please visit http://www.kindermorgan.com.

Please join Kinder Morgan at 4:30 p.m. Eastern Time on Wednesday, Oct. 16, at
www.kindermorgan.com for a LIVE webcast conference call which will include a
discussion of EPB’s third quarter earnings.

The non-generally accepted accounting principles, or non-GAAP, financial
measures of distributable cash flow before certain items, both in the
aggregate and per unit, and earnings before depreciation, depletion,
amortization, or DD&A, and certain items, are presented in this news release.
Distributable cash flow before certain items is a significant metric used by
us and by external users of our financial statements, such as investors,
research analysts, commercial banks and others, to compare basic cash flows
generated by us to the cash distributions we expect to pay our unitholders on
an ongoing basis. Management uses this metric to evaluate our overall
performance. It also allows management to simply calculate the coverage ratio
of estimated ongoing cash flows to expected cash distributions. Distributable
cash flow before certain items is also an important non-GAAP financial measure
for our unitholders because it serves as an indicator of our success in
providing a cash return on investment. This financial measure indicates to
investors whether or not we are generating cash flow at a level that can
sustain or support an increase in the quarterly distributions we are paying
pursuant to our partnership agreement. Our partnership agreement requires us
to distribute all available cash. Distributable cash flow before certain items
and similar measures used by other publicly traded partnerships are also
quantitative measures used in the investment community because the value of a
unit of such an entity is generally determined by the unit’s yield (which in
turn is based on the amount of cash  distributions the entity pays to a
unitholder relative to unit price). The economic substance behind our use of
distributable cash flow before certain items is to measure and estimate the
ability of our assets to generate cash flows sufficient to make distributions
to our investors.

We define distributable cash flow before certain items to be limited partners’
pretax income before certain items and DD&A, less sustaining capital
expenditures for EPB, plus DD&A less sustaining capital expenditures for our
equity method investees Bear Creek, WYCO and as of January 1, 2013 Elba
Liquefaction, plus other income and expenses, net (which primarily includes
deferred revenue, non-cash AFUDC equity and other items). Distributable cash
flow before certain items per unit is distributable cash flow before certain
items divided by average outstanding units. “Certain items” are items that are
required by GAAP to be reflected in net income, but typically either (1) do
not have a cash impact, for example, goodwill impairments, allocated
compensation for which we will never be responsible, and results from assets
prior to our ownership that are required to be reflected in our results due to
accounting rules regarding entities under common control, or (2) by their
nature are separately identifiable from our normal business operations and in
our view are likely to occur only sporadically, for example legal settlements,
hurricane impacts and casualty losses. Management uses this measure and
believes it is important to users of our financial statements because it
believes the measure more effectively reflects our business’ ongoing cash
generation capacity than a similar measure with the certain items included.
For similar reasons, management uses earnings before DD&A and certain items in
its analysis of the performance and management of our business. We believe
earnings before DD&A and certain items is a significant performance metric
because it enables us and external users of our financial statements to better
understand our ability to generate cash on an ongoing basis. We believe it is
useful to investors because it is a measure that management believes is
important and that our chief operating decision makers use for purposes of
making decisions and assessing our performance.

We believe the GAAP measure most directly comparable to distributable cash
flow before certain items is net income. Our calculation of distributable cash
flow before certain items, which begins with net income after subtracting
certain items that are specifically identified in the accompanying tables, is
set forth in those tables. Net income before certain items is presented
primarily because we use it in this calculation. Earnings before DD&A as
presented in our GAAP financials is the measure most directly comparable to
earnings before DD&A and certain items. Earnings before DD&A and certain items
is calculated by removing the certain items attributable to the partnership,
which are specifically identified in the footnotes to the accompanying tables,
from earnings before DD&A.

Our non-GAAP measures described above should not be considered as an
alternative to GAAP net income, operating income or any other GAAP measure.
Distributable cash flow before certain items and earnings before DD&A and
certain items are not financial measures in accordance with GAAP and have
important limitations as analytical tools. You should not consider either of
these non-GAAP measures in isolation or as a substitute for an analysis of our
results as reported under GAAP. Because distributable cash flow before certain
items excludes some but not all items that affect net income and because
distributable cash flow measures are defined differently by different
companies in our industry, our distributable cash flow before certain items
may not be comparable to distributable cash flow measures of other companies.
Earnings before DD&A and certain items has similar limitations. Management
compensates for the limitations of these non-GAAP measures by reviewing our
comparable GAAP measures, understanding the differences between the measures
and taking this information into account in its analysis and its decision
making processes.

This news release includes forward-looking statements. These forward-looking
statements are subject to risks and uncertainties and are based on the beliefs
and assumptions of management, based on information currently available to
them. Although EPB believes that these forward-looking statements are based on
reasonable assumptions, it can give no assurance that such assumptions will
materialize. Important factors that could cause actual results to differ
materially from those in the forward-looking statements herein include those
enumerated in EPB’s reports filed with the Securities and Exchange Commission.
Forward-looking statements speak only as of the date they were made, and
except to the extent required by law, EPB undertakes no obligation to update
or review any forward-looking statement because of new information, future
events or other factors. Because of these uncertainties, readers should not
place undue reliance on these forward-looking statements.

                                                                 
El Paso Pipeline Partners, L.P.
Preliminary Consolidated Statements of Income
(Unaudited)
(in millions, except per unit amounts)
                                                                    
                                                                    
                    Three Months Ended             Nine Months Ended September
                    September 30,                  30,
                    2013           2012            2013            2012
                                                                    
Revenues            $  369         $  368          $  1,114        $  1,125   
                                                                    
Costs, expenses
and other
Operations and         89             83              240             310
maintenance
Depreciation and       49             46              144             137
amortization
Taxes, other than      19             19              63              63      
income taxes
                       157            148             447             510     
Operating income       212            220             667             615
                                                                    
Other income
(expense)
Earnings from
equity                 3              4               9               11
investments
Interest expense,      (75   )        (74   )         (226   )        (218   )
net
Other, net             1              1               1               3       
Net income             141            151             451             411     
                                                                    
Net income
attributable to        -              -               -               (10    )
noncontrolling
interests
Net income
attributable to     $  141         $  151          $  451          $  401     
EPB
                                                                    
Calculation of
Limited Partners'
interest in net
income
attributable to
EPB
Net income
attributable to     $  141         $  151          $  451          $  401
EPB
Less:
Pre-acquisition
earnings               -              -               -               (22    )
allocated to
General Partner
(1)
Plus: Severance
costs allocated        -              3               1               32
to General
Partner
Less: General
Partner's 2%           (3    )        (3    )         (9     )        (8     )
interest
allocation
Less: General
Partner's              (52   )        (36   )         (144   )        (86    )
incentive
distribution
Limited Partners'
interest in net     $  86          $  115          $  299          $  317     
income
                                                                    
Limited Partners'
net income per
unit
Net income          $  0.40        $  0.55         $  1.38         $  1.53    
Weighted average       218            209             217             207     
units outstanding
                                                                    
Per unit cash
distribution        $  0.65        $  0.58         $  1.90         $  1.64    
declared for the
period
                                                                    
Notes:
(1) Represents Cheyenne Plains' earnings prior to EPB's May 24, 2012
acquisition of Cheyenne Plains from El Paso.

                                                                    
El Paso Pipeline Partners, L.P.
Preliminary Reconciliation of Distributable Cash Flow to Net Income
(Unaudited)
(in millions, except per unit amounts)
                                                                      
                                                                      
                    Three Months Ended September       Nine Months Ended
                    30,                                September 30,
                    2013            2012               2013          2012
Earnings before
DD&A and certain    $  286          $  299             $  888        $ 857
items
DD&A                   49              46                 144          132    
Earnings               237             253                744          725
contribution
General and
administrative         (21    )        (25    )           (62    )     (85   )
expense
Interest               (75    )        (74    )           (226   )     (214  )
expense, net
Net income
before certain         141             154                456          426
items
Certain items
Cheyenne Plains
pre-acquisition        -               -                  -            22
earnings
Non-cash
severance costs        -               (3     )           (1     )     (32   )
(4)
CIG
environmental          -               -                  -            6
reserve
adjustment
Loss on
write-off of           -               -                  -            (11   )
asset (1)
SNG offshore
assets hurricane       -               -                  (2     )     -
repair costs
Sales and use
tax reserve            -               -                  (2     )     -      
adjustment (2)
Sub-total              -               (3     )           (5     )     (15   )
certain items
Net Income          $  141          $  151             $  451        $ 411    
Less:
Pre-acquisition
earnings               -               -                  -            (22   )
allocated to
General Partner
(3)
Plus: Severance
costs allocated        -               3                  1            32
to General
Partner (4)
Less: General
Partner's 2%           (3     )        (3     )           (9     )     (8    )
interest
allocation
Less: General
Partner's              (52    )        (36    )           (144   )     (86   )
incentive
distribution
Less:
Noncontrolling         -               -                  -            (10   )
Interests in net
income
Limited
Partners' net       $  86           $  115             $  299        $ 317    
income
                                                                      
Net income
before certain      $  141          $  154             $  456        $ 426
items
Less: Net income
attributable to
Noncontrolling         -               -                  -            (10   )
Interests before
certain items
Net income
attributable to        141             154                456          416
EPB before
certain items
Less: General
Partner's 2%           (3     )        (3     )           (9     )     (8    )
interest
allocation
Less: General
Partner's              (52    )        (36    )           (144   )     (86   )
incentive
distribution
Limited
Partners' net          86              115                303          322
income before
certain items
Depreciation and       49              46                 144          132
amortization (5)
Net income
attributable to
noncontrolling         -               -                  -            10
interests before
certain items
Declared
distributions to
noncontrolling         -               -                  -            (8    )
interests before
certain items
(6)
Other (7)              1               1                  2            -
Sustaining
capital                (9     )        (13    )           (24    )     (29   )
expenditures (8)
DCF before
certain items -     $  127          $  149             $  425        $ 427    
Limited Partners
                                                                      
Net income /
unit before         $  0.40         $  0.55            $  1.40       $ 1.56   
certain items
DCF / unit
before certain      $  0.58         $  0.71            $  1.96       $ 2.06   
items
Weighted average
units                  218             209                217          207    
outstanding
                                                                      
Notes ($
millions):
(1) Reflects write-off of a cancelled software implementation project.
(2) Non-cash reserve adjustment related to periods prior to July 2012.
(3) Represents earnings related to Cheyenne Plains prior to the May 24, 2012
acquisition.
(4) Represents the non-cash severance costs allocated to EPB from El Paso as a
result of KMI's acquisition of El Paso. EPB does not have any obligation nor
did EPB pay any amounts related to this expense.
(5) Includes EPB's share of Bear Creek and WYCO DD&A ($0.2 and $0.6 for 3Q and
YTD 2013, respectively, and $0.1 and $0.5 for 3Q and YTD 2012, respectively).
(6) Cash distributions made to the noncontrolling interest holder.
(7) Includes deferred revenue and other non-cash items such as AFUDC equity
and other items.
(8) Includes EPB's share of Bear Creek and WYCO sustaining capital
expenditures:
$0.8 and $2.4 for 3Q and YTD 2013, respectively, and $0.1 and $0.6 for 3Q and
YTD 2012, respectively.
                                                                      
Transport              7,288           7,973              7,468        7,868  
Volumes (BBtu/d)

                                                            
El Paso Pipeline Partners, L.P.
Preliminary Abbreviated Consolidated Balance Sheet
(Unaudited)
(in millions)
                                                                
                                 September 30,                 December 31,
                                 2013                          2012
ASSETS
Cash and cash equivalents        $         145                 $     114
Other current assets                       212                       241
Property, plant and                        5,903                     5,931
equipment, net
Investments                                79                        72
Regulatory assets and other                236                       223
assets
TOTAL ASSETS                     $         6,575               $     6,581
                                                                
LIABILITIES AND PARTNERS'
CAPITAL
Liabilities
Current maturities of            $         76                  $     93
long-term debt
Other current liabilities                  244                       188
Long-term debt                             4,172                     4,246
Other                                      105                       67
Total liabilities                          4,597                     4,594
                                                                
Partners' capital
Accumulated other                          11                        10
comprehensive income
Other partners' capital                    1,967                     1,977
Total partners' capital                    1,978                     1,987
TOTAL LIABILITIES AND            $         6,575               $     6,581
PARTNERS' CAPITAL
                                                                
Total Debt, net of cash and      $         4,111               $     4,233
cash equivalents (1)
EBITDA (2) (3)                   $         1,127               $     1,073
Debt to EBITDA                             3.6                       3.9
                                                                
                                                                
                                 Twelve Months Ended
                                 September 30, 2013            December 31,
                                                               2012
Net Income                       $         629                 $     589
Certain items                              7                         17
Depreciation and                           190                       178
amortization (3)
Interest expense, net                      301                       289
EBITDA                           $         1,127               $     1,073
                                                                
                                                                
Notes ($ millions):
(1) Amounts reflect the gross debt balance before unamortized discount of $8
for each of the periods presented.
(2) Amounts represent the last twelve months.
(3) Includes add back of EPB's share of Bear Creek and WYCO DD&A, which was
less than $1 for each of the twelve months ended September 30, 2013 and
December 31, 2012.
 

Contact:

El Paso Pipeline Partners, L.P.
Media Relations
Emily Mir, (713) 369-8060
emily_mir@kindermorgan.com
or
Investor Relations, (713) 369-9490
km_ir@kindermorgan.com
www.kindermorgan.com
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