Kinder Morgan, Inc. (KMI, formerly Kinder Morgan Holdco) is the top layer of a large oil and gas cake. It owns Kinder Morgan Management, which manages the general partner of Kinder Morgan Energy Partners (KMP). KMP operates pipeline that transport natural gas, crude oil, gasoline, and other products, along with terminals used to store chemicals and petroleum products. It produces carbon dioxide (CO2), which is used in oil field production. In a major move to become the largest natural gas pipeline and midstream enterprise in North America (with about 75,000 miles of natural gas pipeline and 180 terminals) in 2012 KMI acquired El Paso Corp. (which had 44,000 miles of natural gas pipeline) for about $38 billion.
Mergers and Acquisitions
Apart from greatly expanding the company's size and scope, the El Paso Corp. deal is expected to save KMI more than $400 million of cost savings per year through the integration of the two organizations and the elimination of redundancies.
In mid-2013 it paid $5 billion for Copano Energy, a midstream company with interests in almost 7,000 miles of natural gas pipeline in Oklahoma, Texas, and Wyoming. The acquisition expands Kinder Morgan's operations in the Eagle Ford shale and Barnett shale in Texas, and the Mississippi Lime and Woodford shales in Oklahoma.
KMI also owns 51% of El Paso Pipeline Partners, and about 20% of natural gas pipeline NGPL PipeCo.
The company is a leader in petroleum product transportation, terminal operations, and coke and CO2 transportation; it serves more than 1.1 million customers in the US and Canada.
In 2011 KMI reported a 1% increase in revenues, thanks largely to higher prices for its CO2 and petroleum products compensating for weakness in natural gas prices. However, those same lower natural gas prices resulted in lower gas expenses, helping to substantially lift the company's net income for the year.
KMI's strategy is focused on building and maintaining energy transportation and storage assets, which are central components to a growing natural gas and petroleum products infrastructure across North America.
Following its $2.9 billion IPO, the company is 30% controlled by chairman and CEO Richard Kinder. Other investors include several board members and other management as well as four investment funds.
Kinder led a group of investors in taking KMI private in 2007. It then adopted the Knight name. To take advantage of its better-known brand, it reverted to the Kinder Morgan name in 2009. Kinder Morgan went public in 2011 and changed its name to Kinder Morgan, Inc. IPO proceeds went to the aforementioned selling shareholders.