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El Paso Pipeline president: Path for growth unaffected by spin-off
By Jennifer Lanning Drey
Savannah, Ga., May 25 - El Paso Pipeline Partners' basic strategy and growth trajectory are unaffected by its sponsor El Paso Corp.'s recently announced decision to spin off its exploration and production business, Jim Cleary, El Paso Pipeline's senior vice president, said Wednesday during a presentation at the NAPTP master limited partnership investor conference in Greenwich, Conn.
El Paso Corp. announced on Tuesday that its board of directors has granted initial approval of a plan to separate the company into two publicly traded businesses by year-end.
Cleary also said during his presentation that the decision has not affected El Paso Pipeline Partners' view of its business as a growth business that is beneficial to El Paso Pipeline unitholders and El Pasco Corp. shareholders.
Additionally, El Paso Corp. remains a very strong sponsor for El Paso Pipeline, whose interests are highly aligned with the interests of El Paso Pipeline Partners, Cleary said.
He went on to highlight that El Paso Pipeline's assets produce a stable cash flow with 90% or more of its revenues coming in the form of fixed monthly reservation charges. As a result, the company avoids revenue volatility due to factors including natural gas prices, liquids prices and weather.
Together, the sponsorship by El Paso Corp. and strong asset base has lead to growth that is expected to continue, both through acquisitions and organic growth, Cleary said.
El Paso Pipeline is a Houston-based limited partnership formed by El Paso Corp. to own and operate natural gas transportation pipelines and storage assets.
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