Inter Pipeline Fund

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Inter Pipeline Fund
Type Public
Traded as TSX: IPL.UN
Industry Petroleum industry
Pipeline transport Storage
Founded November 27, 1997
Headquarters Calgary, Canada
Key people John F. Driscoll Chair
Pipeline Management
David W. Fesyk Pres,CEO,Dir Pipeline Management
William A. Van Yzerloo CFO Pipeline Management
Christian P. Bayle Sen.VP
Products ethane, butane, natural gas
Revenue $744.6 mil 9M10[1]Increase11.6%
Operating income $183.37 mil Ytd sep10[1]
Net income $176.1m Ytd 3q10[1]Increase31%
Total assets $4.4818 billion sep10[1]11px
Total equity $1.3397 billion sep10[1]11px
Employees 626 (Sept'10)
Divisions Simon Storage Limited
Website Inter Pipeline Fund

Inter Pipeline Fund TSX: IPL.UN is a multinational petroleum (oil, natural gas and petrochemical products) transportation and infrastructure limited partnership that is among North America's leading natural gas and NGL's extraction businesses (from its liquids (NGL's) counterpart). It is one of Canada's top 100 companies in terms of profit (85) and assets (94).[2][3]

It is the biggest transporter of oil sands' bitumen (over 1 million bbls/d after the Cold Lake oil sands upgrade)[4] and in 2010 it was Alberta's 23rd fastest growing business.[5] The energy infrastructure business is divided into 4 main segments; conventional oil pipelines, natural gas extraction, liquid storage and oilsands transportation. Major companies like Encana, Canadian Natural Resources, Shell Canada, Chevron, Marathon Oil and Imperial Oil rely on the pipelines for transportation to oil refineries and distribution to markets.[4] Abroad it operates in Germany, Ireland and the UK through international business unit Bulk Liquid Storage managed by subsidiary Simon Storage Ltd.[6]

Many other Canadian trusts/funds have recently (2010) converted to corporations but Inter Pipeline's board of directors decided against it citing costs, a lack of tax benefits and the market response to other companies that converted.[7]

History

Inter Pipeline's origins go back to 1997 to Koch Industries a refiner out of which sprang two pipelines one of which formed Koch Pipelines Canada, a conventional oil pipeline transportation company that Inter Pipeline directly traces its roots to. Within the next year it went public on the Toronto Stock Exchange listing under the symbol KPC.UN. In 2000 it bought a 15% interest in the Cold Lake pipeline system which it later increased to a controlling stake through a deal with Encana.[4][8] In early 2003 it purchased a 70% interest in the Cold Lake Pipeline system from Encana for $425 million giving it access to transportation hubs in major cities like Edmonton.[9] In 2004 it paid Williams Companies US$540 million for 3 of Canada's biggest natural gas treatment plants (which processed a combined 3.9 billion ft3 per day). That move gave it direct access to gas supplies from the Mackenzie Delta.[10] 2005 was the year Inter Pipeline entered the UK market by buying Simon Storage, the UK's biggest terminal operator for C$250 million.[11][12] In 2006 annual revenue reached $1 billion after the $38 million takeover of German storage company Tanklager-Gesellschaft Hoyer mbH (TLG). It entered the oilsands in March 2007 when it acquired the Corridor Pipeline from Houston based Kinder Morgan for C$275 million in cash and C$485 million in debt; the deal gave Inter Pipeline the infrastructure used to transport about 30% of the oilsands output (including the 85% interest it had in Cold Lake it is 50%) but also left it with a $1.8 billion infrastructure expansion commitment).[13] A decision by Enbridge and Inter Pipeline to move their pipelines east of the Labiche River helped to reduce the environmental impact and risk associated with the pipelines.[4]

Operations

At the NGL's processing plants natural gas is separated from associated liquids which contain valuable ethane and a mix of propane, butane and pentane. The liquids components have a variety of uses ranging from asphalt to lubricants.

  • Cold Lake - the transportation system sends oil from Cold Lake to Edmonton and Hardisty Alberta. Most of its expansion happened in 2008 when its capacity expanded from a 330,000 bbl/d to 560,000 bbl/d. Between it and Corridor there are 1,900 km of pipeline.
  • Corridor Pipeline - offers services related to oil sands storage and transport.
  • Bulk Liquid Storage - European business based in the UK. Offers trucking services as well as bulk liquid storage (8 terminals with a capacity of 8 million barrels)
  • Conventional Oil Pipelines - The Bow River, Central Alberta and Mid-Saskatchewan pipeline systems which transport almost 200,000 bbls/d to locations in Alberta and Saskatchewan.
  • NGL Extraction - Includes 2 wholly owned and 1 50% owned natural gas processing facilities.

References

  1. ↑ 1.0 1.1 1.2 1.3 1.4 "Inter Pipeline Fund 2010 Third Quarter Report". 2010-11-04. http://www.interpipelinefund.com/pdf/financial/quarterly/2010/Q3_2010_MDA_FS.pdf.
  2. ↑ "Inter Pipeline Fund company information". The Globe and Mail (Toronto). http://www.theglobeandmail.com/globe-investor/markets/stocks/summary/?q=ipl.un-T. Retrieved 2010-12-21.
  3. ↑ "The Venture 100". September 2008. http://www.albertaventure.com/wp-content/uploads/2008/08/v100_08.pdf.
  4. ↑ 4.0 4.1 4.2 4.3 "Oilsands Review A Blossoming Counterbalance". May 2008. http://www.ab-conservation.com/go/tasks/sites/default/assets/File/pdfs/07Media/01InTheNews/Oilsands_Review_May_2008_-_A_Blossoming_Counterbalance.pdf.
  5. ↑ "The Fast Growth 50, 2010". 2010-01-01. http://albertaventure.com/2010/01/the-fast-growth-50-2010/.
  6. ↑ "About Simon Storage". http://www.simonstorage.com/htm/who/who_about.php. Retrieved 2010-12-21.
  7. ↑ "Countdown To T-Day". 2010-11-24. http://www.gordonpape.com/Members/Newsletter/TII/showTII.cfm?CID=14221823&Number=163.
  8. ↑ "Inter Pipeline 10th Anniversary A Decade of Building Value". 2007. http://docs.google.com/viewer?a=v&q=cache:-95wqBnKIx0J:www.lisastrecko.com/assets/Inter%2520Pipeline%2520Legend.pdf+2005+inter+pipeline+acquires+simon+storage+250+MILLION&hl=en&gl=ca&pid=bl&srcid=ADGEESigRkD5C-Q85vDjR-Qm-JPkITOStDh53GkxB8rgsIHm_Vg_2BbraBL6royOOY0ECil1c7p1ezExhP_e6fZvugXHXy40qZxRaowMMicH3Tgy6paafPc-Y8h5GX9wMhHg-CBOO74Y&sig=AHIEtbSverCC0Y6kpAP8Xbbc9JaHBeGhjQ.
  9. ↑ "Encana closes sale of Cold Lake Pipeline System". 2003-01-02. http://www.encana.com/news/newsreleases/2003/P1161617082859.html.
  10. ↑ "Alaska gas liquids at forefront of Alberta straddle-plant deal". 2004-07-08. http://www.petroleumnews.com/newsbulletin/16671406.html.
  11. ↑ "Inter Pipeline Fund Completes Acquisition of Simon Storage". 2005-10-04. http://www.highbeam.com/doc/1P2-13708540.html.
  12. ↑ "Pipeline snaps up UK independent Simon Storage". 2006. http://business.highbeam.com/6211/article-1G1-141619463/inter-pipeline-snaps-up-uk-independent-simon-storage.
  13. ↑ "Inter Pipeline to buy Corridor for C$760 million". Reuters. 2007-03-05. http://www.reuters.com/article/idUSN0525890520070305.


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