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NORTHERN BORDER PARTNERS, L.P. REPORTS FIRST QUARTER NET INCOME OF $14.9 MILLION AND DECLARES QUARTERLY DIVIDEND
FOR IMMEDIATE RELEASE: Monday, April 20, 1998
HOUSTON - Northern Border Partners, L.P. today reported first quarter 1998 net income of $14.9 million, or $0.50 per unit, compared to net income of $13.5 million, or $0.50 per unit, for the same period in 1997. In the first quarter 1998, earnings related to the Partnership's investment in Northern Border Pipeline Company's 700 million cubic feet per day (MMcf/d) expansion and extension into the Chicago area (The Chicago Project) more than offset the additional units issued to fund the investment. Additionally, the first quarter 1997 includes non-recurring net income of $1.4 million, or $0.05 per unit. The Partnership will continue to benefit from The Chicago Project during the remainder of the construction phase, as well as during commercial operation.
"We remain on track for a November 1998 in-service date for The Chicago Project," said Larry L. DeRoin, chairman and chief executive officer of Northern Border Partners, L.P. "Construction work is progressing, with three new compressor stations complete, three more in progress and retrofit work commencing on existing stations. In addition, contractors for the five pipeline spreads are being released to begin construction of the 390 miles of new mainline," DeRoin added.
First quarter throughput volumes averaged 1,808 MMcf/d versus 1,816 MMcf/d for the first quarter of 1997.
The Partnership Policy Committee of Northern Border Partners, L.P. today declared the Partnership's quarterly cash distribution of $0.575 per unit for the first quarter of 1998. The indicated annual rate is $2.30 per unit. The first quarter distribution is payable on May 15, 1998, to unitholders of record as of April 30, 1998, out of the available cash flow from operations of the Partnership from January 1 to March 31, 1998.
Northern Border Partners, L.P. owns a 70 percent general partner interest in Northern Border Pipeline Company, which owns a 969-mile U.S. interstate pipeline system that transports approximately 20 percent of all Canadian natural gas into the U.S. Northern Border Pipeline is currently expanding its capacity by 700 MMcf/d and extending the pipeline into the Chicago, Illinois area. The Partnership also owns the Black Mesa Pipeline, a 273-mile, coal-water slurry pipeline from Kayenta, Arizona to the Mohave Power Station in Laughlin, Nevada. The common units of Northern Border Partners, L.P. are listed on the New York Stock Exchange and trade under the symbol "NBP".
| Northern Border Partners, L.P. Financial Highlights(Unaudited: in millions except net income per unit) First Quarter |
| 1998 | 1997 |
| Operating Revenue | $52.8 | $46.6 |
| Net Income | $14.9 | $13.5 |
| Per Unit Net Income | $0.50 | $0.50 |
| Average Units Outstanding | 29.3 | 26.2 |
| Consolidated Statement of Income*(Unaudited: in millions) First Quarter |
| 1998 | 1997 |
| Operating Revenue | $52.8 | $46.6 |
| >Operating Expenses |
Operations and maintenance | 10.6 | 7.1 |
Depreciation and amortization | 10.4 | 9.6 |
| 6.2 | 6.1 |
| 27.2 | 22.8 |
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| Operating Income | 25.6 | 23.8 |
|
| Interest expense | ( 9.8) | ( 7.8) |
| Other income | 5.2 | 3.1 |
| Minority interest | ( 6.1) | ( 5.6) |
| Net Income | $14.9 | $13.5** |
* As of December 31, 1997, the Partnership owns 100% of Black Mesa Pipeline and Williams Technologies, Inc., which for the First Quarter 1998 are included on a consolidated basis. The Partnership owned 60.5 percent of Black Mesa Pipeline in the First Quarter 1997 and was accounted for on the equity method and included in Other income.
** Net income for the 1997 period includes $1.4 million, or $0.05 per unit, related to amounts received by Northern Border Pipeline for vacating certain microwave frequency bands.
| Northern Border Partners, L.P. Operating Highlights(Unaudited) First Quarter |
| 1998 | 1997 |
| Northern Border Pipeline Company: |
| Gas Delivered (MMcf) | 159,252 | 159,707 |
| Average throughput (MMcf/d) | 1,808 | 1,816 |
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| Financial Results (in millions): |
| $47.5 | $46.6 |
Depreciation & Amortization | $ 9.8 | $ 9.6 |
| $ 9.1 | $ 7.9 |
| $ 2.8 | $ 0.3 |
| $ 1.6 | $ 0.1 |
| $ 6.1 | $ 5.6 |
| $14.2 | $13.1 |
This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Northern Border Partners' believes that its expectations are based on reasonable assumptions, it can give no assurance that such expectations will be achieved. Important factors that could cause actual results to differ materially from those in the forward looking statement herein include, but are not limited to, extreme weather conditions that could delay construction, the failure of vendors and contractors to adhere to contract delivery and timing specifications, and the resolution of certain state and local pipeline right-of-way issues during the periods covered by the forward looking statements.
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For additional information please contact:
A. H. Davis
(713) 853-6941
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