Oct. 17–Houston pipeline giant Kinder Morgan more than doubled its third quarter profit after closing the sale of its controversial Trans Mountain pipeline for about $3.5 billion in August.
The company on Wednesday reported net income of $693 million, up from $334 million during the third quarter last year. The company booked a one-time gain from the Trans Mountain sale on the expectation that its Canadian subsidiary will distribute about $2 billion in proceeds pending shareholder approval later this month.
Kinder Morgan’s revenues rose 9 percent during the quarter to $3.52 billion, up from $3.28 billion in 2017.
Kinder Morgan also saw higher earnings across most of its business segments, driven primarily by natural gas pipelines and Co2 units.
Its natural gas pipelines business, which accounts for a substantial portion of its earnings, benefited from an increase in drilling and production in the Bakken, Haynesville and Eagle Ford basins. It also recorded higher transport volumes thanks in part to power demand and additional capacity sales in the Permian basin.
Kinder Morgan expects to receive its share of the proceeds from the Trans Mountain pipeline in early January. The company has said it will use the money to pay down debt.
Kinder Morgan has lately intensified its focus on expanding its Texas operations with multibillion-dollar natural gas pipelines systems.
It’s now building the Gulf Coast Express Pipeline, a $1.75 billion project that would stretch from the southern Permian Basin in West Texas to Agua Dulce near Corpus Christi. The pipeline expected to begin full service in October 2019.
The company last month made a final investment decision on its Permian Highway Pipeline Project, a $2 billion joint venture with EagleClaw Midstream Ventures that will transport natural gas from Waha, Texas to the U.S. Gulf Coast and Mexico. It’s expected to come online in 2020.
Kinder Morgan reported its earnings after the market closed. Its stock rose 3 cents to $17.95 a share Wednesday.
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