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NORTHERN BORDER PARTNERS, L.P. REPORTS THIRD QUARTER EARNINGS PER UNIT OF $0.60 AND DECLARES THIRD QUARTER DISTRIBUTION
FOR IMMEDIATE RELEASE: Monday, October 19, 1998
HOUSTON -- Northern Border Partners, L.P. (the Partnership) announced today a 28 percent increase in reported earnings per unit to $0.60 for the third quarter of 1998, compared to $0.47 per unit for the same period in 1997. The Partnership generated net income of $18.0 million for the third quarter of 1998 versus $12.7 million for the same period in 1997.
The increase in this quarter’s results is primarily attributable to the returns on the Partnership’s investment in The Chicago Project, an $839 million, 700 million cubic feet per day (MMcf/d) expansion and extension of the Northern Border Pipeline system into the Chicago market area.
“The Chicago Project already has proven to be a great benefit to our unitholders, as demonstrated by the Partnership’s increased earnings per unit,” said Larry L. DeRoin, chairman and CEO of Northern Border Partners, L.P. “Additionally, the cash flows associated with the Project’s long-term firm transportation service contracts are anticipated to provide us the capacity to increase distributions.”
The Partnership previously announced its intention to increase its quarterly cash distribution to $0.60 per unit ($2.40 per unit on an annualized basis) by the fourth quarter of 1998, payable in February 1999. “We continue to target an early December in-service date for The Chicago Project. Looking beyond The Chicago Project, our new Project 2000 just reached an important milestone,” reported DeRoin. “Last week Northern Border Pipeline completed its certificate application and filed for approval with the Federal Energy Regulatory Commission. With timely approval, we anticipate construction will begin in late 1999.”
Already fully subscribed with shipper commitments, Project 2000 is a proposed $190 million, 60 MMcf/d mainline expansion and a 35-mile, 545MMcf/d extension of the Northern Border Pipeline system into Indiana. For the first nine months of 1998, the Partnership reported a 20 percent increase in recurring earnings per unit to $1.65 compared to $1.38 per unit in the first nine months of 1997. The Partnership reported net income of $49.4 million for the first nine months of 1998 versus $37.0 million in the prior year period. Results for 1997 exclude non-recurring earnings of $0.07 per unit, or net income of $2.0 million.
The Partnership Policy Committee of Northern Border Partners, L.P. declared today the Partnership’s regular quarterly cash distribution of $0.575 per unit for the third quarter of 1998. The indicated annual rate is $2.30 per unit. The distribution is payable November 13, 1998 to unitholders of record as of October 30, 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. 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.”
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 or contractors to adhere to contract delivery and timing specifications, the resolution of certain state and local pipeline right-of-way issues, and FERC approval of certain regulatory filings 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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