El Paso Energy Capital Trust I PFD CV TR SECS

What they do

Kinder Morgan owns and operates natural gas pipelines, storage, and terminals, as well as crude oil, refined products, and CO2 infrastructure. Its operations are organized into Natural Gas Pipelines, Products Pipelines, Terminals, and CO2 segments. The company generates fee-based revenue from long-term transportation, storage, and processing contracts, with a focus on natural gas infrastructure.

Revenue drivers

• Natural Gas Pipelines (Midstream) — Largest segment; includes interstate pipelines (e.g., Tennessee Gas Pipeline, Gulf Coast Express), gathering and processing systems (e.g., Outrigger Energy in North Dakota), and storage. Revenue from contracted capacity and throughput fees; this segment represents the majority of EBITDA.
• Terminals — Provides liquid and bulk storage and handling services, including for chemicals, petroleum products, and steel. Revenue from throughput and storage fees; geographically diversified across North America.
• Products Pipelines — Transports gasoline, diesel, jet fuel, and NGLs through refined products and NGL pipelines. Revenue from tariffs on volumes shipped; utilization tied to regional fuel demand.
• CO2 Segment — Produces and markets CO2 for enhanced oil recovery and operates a CO2 pipeline network and oil producing properties. Revenue from CO2 sales and crude oil production; more volatile due to commodity prices.

Recent performance

For Q2 2026, Kinder Morgan reported net income attributable to KMI of $867 million, up 21% from $715 million in Q2 2025, and record Adjusted EBITDA of $2,199 million, up 12%. EPS was $0.39, up 22% year-over-year, with Adjusted EPS of $0.37, up 32%. Operating cash flow in the quarter was $2 billion, and free cash flow after capex was $1 billion. For full-year 2025, revenue was $15.20 billion, net income was $3.06 billion, and diluted EPS was $1.37, with dividends per share of $1.17.

Strategy

Management focuses on fee-based, long-term contracted assets to generate stable cash flows, and aims to internally fund the vast majority of its project backlog. In 2026, it expects to invest $4.1 billion in expansion projects, acquisitions, and joint ventures. Recent acquisitions include the $648 million Outrigger Energy gathering system (Feb 2025) and the $503 million Monument Pipeline system (May 2026), both in the Natural Gas Pipelines segment. The company also divested its 25% interest in EagleHawk for $382 million in December 2025, and is emphasizing natural gas infrastructure to serve LNG exports, power demand, and industrial expansion.

Risks

• Commodity price and supply dependence — Pipeline and terminal volumes depend on producers' ability to develop reserves and on demand for hydrocarbons; sustained low commodity prices could reduce throughput.
• Climate change and energy transition — Increased public concern and policy shifts toward renewable energy could reduce demand for fossil fuel infrastructure over time.
• Project execution and cost overruns — Large expansion projects like Gulf Coast Express and Cumberland involve construction risks that could impact returns or timing.
• Debt and leverage — With long-term debt of $29.80B and a Net Debt-to-Adjusted EBITDA target range, higher interest rates or cash flow shortfalls could pressure balance sheet flexibility.

Outlook

For 2026, management budgets net income attributable to KMI of $3.1 billion, Adjusted EPS of $1.36, declared dividends of $1.19 per share (a 2% increase from 2025), and Adjusted EBITDA of $8.6 billion. Year-end Net Debt-to-Adjusted EBITDA is expected at 3.8 times. The project backlog is $9.6 billion as of Q2 2026, with ~92% in natural gas projects, and management expects the non-EOR/gathering portion to generate a first-full-year EBITDA multiple of about 5.6 times.