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Kinder Morgan, Inc. Makes Final Investment Decision on Trans Mountain Expansion Project

Kinder Morgan Canada Limited Prices C$1.75 billion Initial Public Offering

HOUSTON--(BUSINESS WIRE)--Kinder Morgan, Inc., (NYSE: KMI), today announced a final investment decision for the Trans Mountain Expansion Project in conjunction with its indirect subsidiary, Kinder Morgan Canada Limited (KML), pricing its initial public offering (the Offering) of 102.9 million shares of common stock at a price to the public of C$17.00 per share for total gross proceeds of C$1.75 billion. The final investment decision is conditioned on the successful completion of the IPO, which is expected to take place by not later than May 31, 2017.

“Upon the completion of the IPO, we will have secured satisfactory financing for the Trans Mountain Expansion Project. We are excited to be moving forward on this tremendous project which is expected to benefit KMI and KML as well as our Trans Mountain shippers and Canada,” said Steve Kean, Kinder Morgan chief executive officer. “The KML IPO is one of the largest ever in Canada and provides Canadian investors the opportunity to invest in a leading integrated midstream set of western Canadian assets. We are very pleased to price the Offering and excited about the future growth opportunities that this platform enables. The Offering also strengthens KMI’s balance sheet and strengthens our ability to return value to shareholders.”

“Our execution planning is complete, our approvals are in hand, and we are now ready to commence construction activities this fall generating thousands of direct jobs for Canadians, including significant benefits to Indigenous communities in Alberta and British Columbia,” said Ian Anderson, president of Kinder Morgan Canada Limited.

The Trans Mountain Expansion Project is a C$7.4 billion project (with a remaining cash spend of C$6.2 billion as of March 31, 2017) which upon completion will provide western Canadian oil producers with an additional approximately 590,000 barrels per day (resulting in total pipeline capacity of 890,000 barrels per day) of shipping capacity and tidewater access to the western United States and global markets. The project is underpinned by 15- and 20-year shipper commitments of 707,500 barrels per day, or roughly 80 percent of the capacity on the expanded pipeline, with the other 20 percent reserved for spot volumes as required by the National Energy Board. Construction on the project is expected to begin in September 2017 with completion expected in December 2019.

The final investment decision was contingent on securing financing. While the political climate was not ideal, the process proceeded at this time because the Trans Mountain Expansion Project financing contingency period, as specified in shipper agreements, concludes at the end of May.

The Offering constitutes a sale of a portion of KMI’s interest in the Canadian business of KMI (the Business). The Business is composed of: the Trans Mountain pipeline system (including related terminals assets), the Puget Sound pipeline, the Jet Fuel pipeline system, the Canadian portion of the Cochin pipeline system, the Vancouver Wharves Terminal and the North 40 Terminal; as well as three jointly controlled investments: the Edmonton Rail Terminal, the Alberta Crude Terminal and the Base Line Terminal.

KMI will use the proceeds it receives to pay down debt. As a result, KMI now expects to end the year at approximately 5.2X debt to EBITDA versus its budget of 5.4X and remains on track to announce revised dividend guidance for 2018 in the latter part of this year, consistent with the previously announced goal of returning additional value to shareholders. Upon closing of the Offering, KMI will own an approximately 70 percent interest in the Business, which will be operated and administered by KML and its affiliates.

An amended and restated preliminary prospectus of KML containing important information relating to these securities has been filed with the securities commissions or similar authorities in each province and territory of Canada. The amended and restated prospectus of KML is still subject to completion or amendment. Copies of the amended and restated prospectus of KML are available on SEDAR at or from the underwriters named in it. There will not be any sale or any acceptance of any offer to buy the securities until a receipt for the final prospectus has been issued.

The securities of KML have not been and will not be registered under the United States Securities Act of 1933 (the Securities Act) or the securities laws of any state or other jurisdiction of the United States. Accordingly, these securities may not be offered or sold in the United States absent registration under the Securities Act or an exemption from registration, and in each case in compliance with the applicable securities laws of any state or other jurisdiction of the United States. In particular, this press release is not an offer of securities for sale in the United States.

About Kinder Morgan, Inc. (KMI)

Kinder Morgan, Inc. (NYSE: KMI) is one of the largest energy infrastructure companies in North America. It owns an interest in or operates approximately 84,000 miles of pipelines and 155 terminals. KMI’s pipelines transport natural gas, refined petroleum products, crude oil, condensate, CO2 and other products, and its terminals transload and store petroleum products, ethanol and chemicals, and handle such products as steel, coal and petroleum coke. It is also a leading producer of CO2 that we and others use for enhanced oil recovery projects primarily in the Permian basin. For more information please visit

About Kinder Morgan Canada Limited (KML)

Kinder Morgan Canada Limited will operate the Business, comprised of a number of pipeline systems and terminal facilities including the Trans Mountain pipeline, the Cochin pipeline, the Puget Sound and Trans Mountain Jet Fuel pipelines, the Westridge marine and Vancouver Wharves terminals in British Columbia as well as various crude oil loading facilities in Edmonton, Alberta.

The Trans Mountain pipeline currently transports approximately 300,000 barrels per day (bpd) of crude oil and refined petroleum products from the oil sands in Alberta to Vancouver, British Columbia and Washington state. On Nov. 29, 2016, the Government of Canada granted approval for the $7.4 billion Trans Mountain Expansion Project, to increase the nominal capacity of the system to 890,000 bpd. The expanded pipeline is expected to be completed in 2019.

Important Information Relating to Forward-Looking Statements

In the interests of providing potential investors with information regarding KMI and KML, including management's assessment of KMI's and KML's future plans for the Business, certain statements contained in this news release are forward-looking statements or information within the meaning of applicable securities legislation, collectively referred to herein as "forward-looking statements." Forward-looking statements in this news release include, but are not limited to: the expected future activities of KML following closing of the Offering, KMI's expected ownership level in KML following closing of the Offering, expectations that applicable regulatory approvals will be obtained, the success of the Offering, and expected timing of closing of the Offering. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.

By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause the Business' actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. There can be no assurance that KML will ultimately complete the Offering, the size of the retained interest that KMI would hold initially or in the future in KML, and other arrangements that would exist between KMI and KML. Closing of the Offering is subject to a number of risks and uncertainties, including without limitation, those relating to due diligence, favourable market conditions, stock exchange and regulatory approvals, and approval by KMI's and KML's boards of directors. Although KMI believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Potential investors are cautioned that the foregoing list of important factors is not exhaustive. In addition, assumptions relating to such forward-looking statements generally include KMI's current expectations and projections made in light of, and generally consistent with, its historical experience and its perception of historical trends, all of which are subject to the risk factors identified elsewhere in this news release or in the preliminary prospectus, including assumptions related to receipt of all required regulatory approvals and completion of the Offering. Furthermore, the forward-looking statements contained in this news release are made as of the date hereof and, except as required by law, KMI and KML undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.


Kinder Morgan, Inc.
Media Relations
Dave Conover, (713) 369-9407
Investor Relations
(713) 369-9490

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