Fort Chicago announces solid 2009 second quarter results



    
    /NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
    DISSEMINATION IN THE UNITED STATES./

    Trading Symbol: FCE.UN
    Exchange: TSX
    

    CALGARY, Aug. 4 /CNW/ - Fort Chicago Energy Partners L.P. ("Fort Chicago"
or "the Partnership") today announced its results for the three months ended
June 30, 2009. Mr. Stephen H. White, President and Chief Executive Officer
commented, "The second quarter performance of each of our businesses was
consistent with our expectations. In particular, Aux Sable generated solid
results, as favourable NGL market conditions supported the recognition of $6.8
million of margin-based lease revenues. I am also gratified Fort Chicago
received a strong, investment grade credit rating from DBRS in July 2009, in
addition to our existing Standard & Poor's investment grade rating. These
credit ratings are evidence of the sound fundamentals which underpin Fort
Chicago's businesses. Our ability to finance future growth and overall
liquidity has also been significantly enhanced by our recent $200 million
senior note offering and other financing activities described below. Through
these activities we have largely addressed the April 2011 maturity of our 2004
credit facility."

    
    Highlights

    -   Net income of $20.0 million or $0.15 per Unit for second quarter 2009
    -   Distributable cash of $38.6 million or $0.29 per Unit for second
        quarter 2009
    -   Continued improvement in NGL market conditions during second quarter
        resulted in recognition of $6.8 million margin-based lease revenues;
        additional $7.9 million unrecognized
    -   $200 million senior unsecured notes issued through public offering
        July 28, 2009
    -   Alliance Pipeline's proposed new receipt and delivery services well
        received in open seasons


    Financial Highlights

                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands, except per
     Unit amounts)                     2009       2008       2009       2008
    -------------------------------------------------------------------------
    Revenues
      Pipeline(1)                   104,109    101,067    209,857    209,331
      NGL                            28,156     58,450     49,697     96,306
      Power                          16,903     19,120     39,842     45,880
      Fort Chicago - Corporate          122         47        698        384
    -------------------------------------------------------------------------
                                    149,290    178,684    300,094    351,901
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net income (loss) before tax
      Pipeline                       26,065     25,491     54,026     61,647
      NGL                             5,889     27,380      3,349     38,087
      Power                          (2,213)       804     (4,199)     6,704
      Fort Chicago - Corporate
        General, administrative
         and project development     (6,756)    (7,192)   (13,494)   (11,964)
        Interest                     (2,674)    (4,240)    (5,639)    (8,859)
        Depreciation                 (1,017)    (1,013)    (2,032)    (2,225)
        Foreign exchange gains
         (losses)                     2,528     (7,349)     1,840    (14,146)
    -------------------------------------------------------------------------
                                     (7,919)   (19,794)   (19,325)   (37,194)
    -------------------------------------------------------------------------
                                     21,822     33,881     33,851     69,244
    Taxes                            (1,863)   (13,764)    (2,588)   (17,082)
    -------------------------------------------------------------------------
    Net income                       19,959     20,117     31,263     52,162
      Per Unit ($)                     0.15       0.15       0.23       0.39
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Adjustments to net income for
     non-recurring (gains) losses
      Fair value loss reclassified
       from other comprehensive income    -          -      2,288          -
      Alliance shipper claim
       settlement                         -          -          -     (6,840)
      Gain on dilution of investment      -          -          -     (3,660)
    -------------------------------------------------------------------------
    Adjusted Net income              19,959     20,117     33,551     41,662
      Per Unit ($)                     0.15       0.15       0.25       0.31
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (1) Net of intersegment eliminations.
    

    For the second quarter of 2009 the Partnership generated net income of
$20.0 million or $0.15 per Unit, which approximates amounts generated during
the same period last year. Alliance and AEGS, which comprise Fort Chicago's
Pipeline business, continued their steady financial performance, generating
aggregate net income before tax of $26.1 million, up slightly from the same
period last year. Alliance's second quarter earnings benefited from increased
income tax recoveries and the effect of the weaker Canadian dollar relative to
the same period last year.
    The NGL business generated second quarter net income before tax of $5.9
million, in line with management's expectations. This compares to $27.4
million for the same period last year when NGL market conditions resulted in
record breaking profits. Aux Sable generated year-to-date margin-based lease
revenues of $14.7 million, $6.8 million of which was recognized in the second
quarter. Barring an abrupt and significant downward shift in NGL market
conditions, the balance of unrecognized margin-based lease revenues is
expected to be recognized during the remainder of the year.
    The Power business generated a second quarter pre-tax loss of $2.2
million compared to pre-tax income of $0.8 million during the same period last
year. The incremental tolling and capacity payments received in association
with Fort Chicago Power's new power generation facilities, Brush and the
London cogeneration facility, were offset by increased depreciation costs and
the recognition of a $1.9 million non-cash fair value loss in respect of Fort
Chicago Power's exchangeable debentures.
    Corporate costs before income taxes for the second quarter were $21.8
million, down from $33.9 million for the same period last year, primarily
reflecting lower foreign exchange losses, previously deferred and recorded in
other comprehensive income, resulting from lower amounts of cash distributed
by the Partnership's U.S. businesses and a weaker Canadian dollar, and lower
interest costs. Income taxes for the second quarter amounted to $1.9 million
compared to $13.8 million for the same period last year, reflecting the
decrease in earnings from Aux Sable.

    
                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands, except per
     Unit amounts)                     2009       2008       2009       2008
    -------------------------------------------------------------------------
    Distributable cash(2)
      Pipeline                       33,835     31,238     68,468     72,678
      NGL                             6,357     28,607      5,582     38,847
      Power                           4,767      1,163      9,829      1,028
      Fort Chicago - Corporate       (6,340)   (19,443)   (14,250)   (28,173)
    -------------------------------------------------------------------------
                                     38,619     41,565     69,629     84,380
        Per Unit                       0.29       0.31       0.52       0.64
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Cash from operating activities   33,227     39,512     77,607    135,111
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (2) This item is not a standard measure under GAAP and may not be
        comparable to similar measures presented by other entities. See
        section entitled "Non-GAAP Financial Measures" contained in Fort
        Chicago's 2008 Management's Discussion and Analysis.
    

    Distributable cash for the second quarter of 2009 was $38.6 million or
$0.29 per Unit compared to $41.6 million or $0.31 per Unit for the same period
last year. This decrease primarily reflects lower distributions from Aux
Sable, which amounted to $6.4 million this quarter compared to $28.6 million
for the second quarter last year. This was partially offset by increased
distributable cash from the Partnership's other businesses. The Pipeline
business generated $33.8 million of distributable cash in the second quarter,
compared to $31.2 million for the same period last year, reflecting Alliance's
increased income tax recoveries and the effect of the weaker Canadian dollar.
Distributable cash from the Power business increased from $1.2 million in the
second quarter of 2008 to $4.8 million this quarter, due to incremental cash
flows from Brush and the London cogeneration facility, as well as the
completion of major maintenance at the California cogeneration facilities in
the first half of 2008. Further, distributable cash outflows relating to
corporate activities decreased significantly, from $19.4 million in the second
quarter of 2008 to $6.3 million this quarter, reflecting lower cash taxes
associated with reduced Aux Sable earnings, decreased interest costs due to
lower average interest rates in 2009, and realized foreign exchange gains,
resulting from the repayment of U.S. dollar-denominated debt.
    Cash from operating activities for the second quarter of 2009 was $33.9
million compared to $39.5 million for the same period last year, primarily
reflecting decreased cash generated from Aux Sable, partially offset by
increased cash generated by Fort Chicago Power, lower corporate interest costs
and cash taxes, and higher realized foreign exchange gains.

    Operating Highlights

    During the second quarter of 2009 the Alliance pipeline continued to
operate in a reliable manner, fully meeting its contracted 1.325 billion cubic
feet per day of firm-service shipping capacity. Actual second quarter
transportation deliveries averaged 1.587 bcf/d, a slight decrease from volumes
of 1.623 bcf/d delivered during the same period last year. AEGS second quarter
toll volumes of 273.4 thousand barrels per day decreased slightly relative to
302.9 mbbls/d in the same period last year, due primarily to lower ethane
receipts from Empress-area extraction plants during the quarter. Aux Sable
processed 99 percent of the natural gas delivered by Alliance during the
second quarter. For the second quarter, average NGL daily volumes were 70.8
mbbls/d, down from 74.3 mbbls/d for the same period last year, but up
significantly from the first three months of 2009 when ethane was being
reinjected due to negative margins. Fort Chicago Power generated 112,525
megawatt hours of electricity compared to 79,782 MWh in the second quarter of
2008, reflecting improved efficiency at the California cogeneration facilities
due to recent maintenance work and incremental electricity generation at the
Brush and London cogeneration facilities. NRGreen's waste heat electrical
generation facilities operated reliably throughout the second quarter.
Construction of the East Windsor cogeneration facility continues to make good
progress. The project is expected to be completed at a capital cost of $104
million, slightly above its original budget of $103.5 million, and to be
placed into commercial service in the third quarter of 2009.

    July 2009 Senior Note Offering

    On July 28, Fort Chicago issued $200 million of senior unsecured notes
through a public offering. The senior notes, which bear interest of 5.60
percent and have a five-year term, have been assigned credit ratings of BBB
(high) with a stable trend by DBRS and BBB with a stable outlook by Standard &
Poor's. The net proceeds from the offering of the senior notes were used to
repay a portion of the outstanding indebtedness under the Partnership's 2004
revolving credit facility, which borrowings were used, in part, to finance the
August 2007 acquisition of Countryside Power Income Fund (now named Fort
Chicago Power Ltd.) and a portion of the outstanding 6.25 percent exchangeable
unsecured subordinated U.S. dollar denominated debentures of Countryside
Canada Power Inc. Mr. White commented, "The refinancing of the Countryside
acquisition has been a goal of ours since we closed the transaction. The
issuance of the senior notes achieves that goal and, together with the recent
expansion of our 2008 credit facility, affords us considerable flexibility in
pursuing acquisition and development opportunities."

    Alliance Business Initiatives

    From June 1, 2009 to July 15, 2009 Alliance held concurrent open seasons
for two new services: Gathering Receipt Service ("GRS") and Canadian Delivery
Service ("CDEL"), Alliance's first-ever Canadian delivery service. Both
services were proposed in response to commercial interests presented to
Alliance. GRS, offered in response to requests for additional receipt capacity
on Alliance from producers, marketers and consumers conducting business in
B.C., Alberta and Saskatchewan, included four discrete zones within Alliance's
gathering service extending from northeast British Columbia to south-central
Alberta. CDEL, offered in response to interest expressed by Canadian
transporters, storage operators and end-users, would deliver natural gas from
Alliance's northwestern Alberta and northeastern B.C. receipt points to
Canadian markets.
    Alliance has received sufficient interest for both GRS and CDEL to
proceed with detailed capital costing and preparation for regulatory approval
of the various resulting projects. Alliance is currently analyzing results and
will continue to work with subscribers to refine the services.

    2009 Guidance

    On July 14, 2009 the Partnership announced an update to its 2009
guidance, wherein it narrowed the forecasted range of distributable cash from
a low of $0.96 per Unit and high of $1.27 per Unit, to a low of $1.00 per Unit
and a high of $1.25 per Unit, with a payout ratio expected to be between 80
percent and 100 percent. This updated guidance primarily reflects a more
favourable outlook for Aux Sable, partially offset by updated assumptions
regarding the Canadian/U.S. dollar exchange rate. Further details concerning
2009 guidance can be found in the Investor Information section of Fort
Chicago's website at www.fortchicago.com.

    
    Conference Call
    ---------------
    
    Fort Chicago will hold a conference call at 9:00 a.m. Mountain time
(11:00 a.m. Eastern time) on Wednesday, August 5, 2009, to discuss the second
quarter results of 2009. The call can be accessed at 1-800-595-8550 or
1-416-644-3418. A replay will be available shortly thereafter at
1-877-289-8525 and 1-416-640-1917. The access code in each case is 21311033
(followed by the No. sign).

    Fort Chicago is a publicly traded limited partnership based in Calgary,
Alberta, that owns and operates energy infrastructure assets across North
America. Its Class A Units are listed on the TSX under the symbol FCE.UN. Fort
Chicago is engaged in three principal businesses: a pipeline transportation
business comprised of interests in two pipeline systems, the Alliance Pipeline
and the Alberta Ethane Gathering System; an NGL extraction business which
includes a significant interest in a world-class extraction facility near
Chicago; and a power business with cogeneration facilities in Ontario,
Colorado and California, district energy systems in Ontario and Prince Edward
Island and waste heat power facilities along the Alliance Pipeline. Fort
Chicago and its businesses are also actively developing a number of greenfield
investment opportunities that will be a key source of future growth, including
LNG and pipeline facilities on the U.S. west coast, Alberta-based ethane and
NGL extraction facilities, repowering and expansion opportunities at the
California power facilities and Nova Scotia-based underground natural gas
storage and pipeline facilities.

    
                     Class A Unit Ownership Restrictions

    Fort Chicago is organized in accordance with the terms and conditions of
    a limited partnership agreement which provides that no Class A Units may
    be transferred to, among other things, a person who is a "non-resident"
    of Canada, a person in which an interest would be a "tax shelter
    investment" or a partnership which is not a "Canadian partnership" for
    purposes of the Income Tax Act (Canada).
    

    Certain information contained herein relating to, but not limited to,
Fort Chicago and its businesses constitutes forward-looking information under
applicable securities laws. All statements, other than statements of
historical fact, which address activities, events or developments that Fort
Chicago expects or anticipates may or will occur in the future, are
forward-looking information. Forward-looking information typically contains
statements with words such as "may", "estimate", "anticipate", "believe",
"expect", "plan", "intend", "target", "project", "forecast" or similar words
suggesting future outcomes or outlook. Forward-looking statements in this news
release include, but are not limited to, statements with respect to: timing of
the start-up of the East Windsor cogeneration facility; NGL market conditions
for 2009; and the ability of each of its businesses to generate distributable
cash in 2009. The risks and uncertainties that may affect the operations,
performance, development and results of Fort Chicago's businesses include, but
are not limited to, the following factors: the ability of Fort Chicago to
successfully implement its strategic initiatives and achieve expected
benefits; levels of oil and gas exploration and development activity; the
status, credit risk and continued existence of contracted customers; the
availability and price of capital; the availability and price of energy
commodities; the availability of construction services and materials;
fluctuations in foreign exchange and interest rates; Fort Chicago's ability to
successfully obtain regulatory approvals; changes in tax, regulatory,
environmental, and other laws and regulations; competitive factors in the
pipeline, NGL and power industries; operational breakdowns, failures, or other
disruptions; and the prevailing economic conditions in North America.
Additional information on these and other risks, uncertainties and factors
that could affect Fort Chicago's operations or financial results are included
in its filings with the securities commissions or similar authorities in each
of the provinces of Canada, as may be updated from time to time. Readers are
also cautioned that the foregoing list of factors and risks is not exhaustive.
The impact of any one risk, uncertainty or factor on a particular
forward-looking statement is not determinable with certainty as these factors
are independent and management's future course of action would depend on its
assessment of all information at that time. Although Fort Chicago believes
that the expectations conveyed by the forward-looking information are
reasonable based on information available on the date of preparation, no
assurances can be given as to future results, levels of activity and
achievements. Undue reliance should not be placed on the information contained
herein, as actual result achieved will vary from the information provided
herein and the variations may be material. Fort Chicago makes no
representation that actual results achieved will be the same in whole or in
part as those set out in the forward-looking information. Furthermore, the
forward-looking statements contained herein are made as of the date hereof,
and Fort Chicago does not undertake any obligation to update publicly or to
revise any forward-looking information, whether as a result of new
information, future events or otherwise. Any forward-looking information
contained herein is expressly qualified by this cautionary statement.
    Certain financial information contained in this news release may not be
standard measures under Generally Accepted Accounting Principles ("GAAP") in
Canada and may not be comparable to similar measures presented by other
entities. These measures are considered to be important measures used by the
investment community and should be used to supplement other performance
measures prepared in accordance with GAAP in Canada. For further information
on non-GAAP financial measures used by Fort Chicago see Management's
Discussion and Analysis, in particular, the section entitled "Non-GAAP
Financial Measures" contained in the annual Management Discussion and
Analysis, filed by Fort Chicago with Canadian securities regulators.


    
    Fort Chicago Energy Partners L.P.
    -------------------------------------------------------------------------

    Consolidated Statement of Financial Position
    -------------------------------------------------------------------------
                                                       June 30,  December 31,
    ($ Thousands; unaudited)                              2009          2008
    -------------------------------------------------------------------------

    Assets
    Current assets
      Cash and short-term investments                   32,228        56,064
      Restricted cash                                    8,360        20,280
      Transportation security deposits and
       revenue adjustments                               2,492         7,989
      Receivables                                       68,236        61,935
      Inventory                                          3,569         3,913
      Prepaid expenses and other                         6,977        12,349
    -------------------------------------------------------------------------
                                                       121,862       162,530

    Long-term receivables                              375,194       273,392
    Pipeline, plant and other capital assets         2,443,576     2,547,701
    Intangible assets                                  113,263       121,267
    Other assets                                        22,368        22,789
    -------------------------------------------------------------------------
                                                     3,076,263     3,127,679
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities
    Current liabilities
      Payables                                          80,547       112,623
      Transportation security deposits                   3,738         5,581
      Distribution payable                               7,228        11,162
      Current portion of long-term senior debt
       and capital leases                               94,469        89,176
      Exchangeable debentures                           27,088        25,717
    -------------------------------------------------------------------------
                                                       213,070       244,259

    Long-term senior debt and capital leases         1,682,535     1,758,958
    Subordinated convertible debentures                 23,981        23,909
    Future taxes                                       336,006       239,823
    Other long-term liabilities                         55,120        60,143
    -------------------------------------------------------------------------
                                                     2,310,712     2,327,092
    -------------------------------------------------------------------------

    Partners' Equity
    Partners' capital account                        1,028,963     1,013,278
    Cumulative other comprehensive loss                (21,988)       (7,306)
    Cumulative net income                              577,406       546,143
    Cumulative distributions                          (818,830)     (751,528)
    -------------------------------------------------------------------------
                                                       765,551       800,587
    -------------------------------------------------------------------------
                                                     3,076,263     3,127,679
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Fort Chicago Energy Partners L.P.
    -------------------------------------------------------------------------

    Consolidated Statement of Income and Cumulative Income
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands, except per
     Unit amounts; unaudited)          2009       2008       2009       2008
    -------------------------------------------------------------------------
    Revenues
      Operating revenues            148,564    178,802    297,384    335,571
      Interest and other                726       (118)     2,710     16,330
    -------------------------------------------------------------------------
                                    149,290    178,684    300,094    351,901
    -------------------------------------------------------------------------
    Expenses
      Operations and maintenance     45,767     60,073     97,040    114,321
      Depreciation and amortization  35,750     30,805     71,995     62,586
      Interest and other finance     25,400     26,352     51,526     54,719
      General, administrative and
       project development           21,077     20,100     43,489     36,800
      Foreign exchange and other       (526)     7,473      2,193     14,231
    -------------------------------------------------------------------------
                                    127,468    144,803    266,243    282,657
    -------------------------------------------------------------------------
    Net income before taxes          21,822     33,881     33,851     69,244
      Current taxes                   2,717     11,105      2,819     11,271
      Future taxes                     (854)     2,659       (231)     5,811
    -------------------------------------------------------------------------
    Net income                       19,959     20,117     31,263     52,162
    Cumulative net income at the
     beginning of the period        557,447    516,689    546,143    484,644
    -------------------------------------------------------------------------
    Cumulative net income at the
     end of the period              577,406    536,806    577,406    536,806
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net income per Unit
      Basic and diluted                0.15       0.15       0.23       0.39
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Consolidated Statements of Comprehensive Income and Cumulative Other
    Comprehensive Income
    -------------------------------------------------------------------------

                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands; unaudited)           2009       2008       2009       2008
    -------------------------------------------------------------------------
    Net income                       19,959     20,117     31,263     52,162
    Other comprehensive income
     (loss), net of taxes
      Cumulative translation
       adjustment
        Unrealized foreign exchange
         gain (loss) on translation
         of self-sustaining foreign
         operations                 (38,882)    (3,186)   (25,886)     9,837
        Deemed realization of
         cumulative translation
         adjustment reclassified
         to net income                  377      7,054      1,038     15,897
        Gain (loss) on hedge of
         self-sustaining foreign
         operation                   11,430        744      7,870     (2,440)
      Fair value loss transferred
       to net income                      -          -      1,427          -
      Other                             607        216        869      3,537
    -------------------------------------------------------------------------
                                    (26,468)     4,828    (14,682)    26,831
    -------------------------------------------------------------------------
    Comprehensive income (loss)      (6,509)    24,945     16,581     78,993
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Cumulative other comprehensive
     income (loss) at the
     beginning of the period          4,480    (80,089)   (7,306)   (102,092)
    Other comprehensive income
     (loss), net of taxes            (26,468)     4,828   (14,682)    26,831
    -------------------------------------------------------------------------
    Cumulative other comprehensive
     loss at the end of the period   (21,988)    (75,261)  (21,988)  (75,261)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Fort Chicago Energy Partners L.P.
    -------------------------------------------------------------------------

    Consolidated Statement of Cash Flows
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands; unaudited)           2009       2008       2009       2008
    -------------------------------------------------------------------------
    Operating
      Net income                     19,959     20,117     31,263     52,162
      Non-cash transportation
       revenue                       (1,683)    (2,760)    (1,252)    (3,508)
      Depreciation, amortization
       and other non-cash items      39,290     32,319     73,842     56,564
      Unrealized foreign exchange
       loss                             445      8,039        222     14,704
      Future taxes                     (854)     2,669       (231)     5,811
      Changes in non-cash
       working capital              (23,930)   (20,872)   (26,237)     9,378
    -------------------------------------------------------------------------
                                     33,227     39,512     77,607    135,111
    -------------------------------------------------------------------------
    Financing
      Long-term debt repaid         (36,300)   (33,422)   (37,287)   (35,815)
      Net change in credit
       facilities                   (12,533)   (10,496)     6,457     14,420
      Distributions paid            (22,037)   (33,062)   (55,552)   (65,983)
      Other                            (512)    (1,258)      (512)      (402)
    -------------------------------------------------------------------------
                                    (71,382)   (78,238)   (86,894)   (87,780)
    -------------------------------------------------------------------------
    Investing
      Pipeline, plant and other
       capital assets                (5,555)   (36,648)   (14,074)   (64,768)
      Restricted cash                 4,291     20,189     11,911     30,797
      Other                               -          -     (1,008)   (11,307)
    Changes in non-cash investing
     working capital                 (1,586)    (5,615)    (8,801)      (285)
    -------------------------------------------------------------------------
                                     (2,850)   (22,074)   (11,972)   (45,563)
    -------------------------------------------------------------------------
    Increase (decrease) in cash
     and short-term investments
     before the effect of foreign
     exchange rate changes on cash
     and short-term investments     (41,005)   (60,800)   (21,259)     1,768
    Effect of foreign exchange
     rate changes on cash and
     short-term investments          (3,085)      (399)    (2,577)       655
    Cash and short-term
     investments at the beginning
     of the period                   76,318    110,813     56,064     47,191
    -------------------------------------------------------------------------
    Cash and short-term
     investments at the end of
     the period                      32,228     49,614     32,228     49,614
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Fort Chicago Energy Partners L.P.
    -------------------------------------------------------------------------

    Distributable Cash(1)
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands, except
     where noted; unaudited)           2009       2008       2009       2008
    -------------------------------------------------------------------------

    Cash inflows
      Alliance distributions,
       prior to withholdings for
       capital expenditures and
       net of debt service           30,285     27,186     61,173     64,684
      AEGS distributable cash,
       after non-recoverable capital
       expenditures and debt service  3,550      4,052      7,295      7,994
      Aux Sable distributions, net
       of support payments,
       non-recoverable debt service
       costs and maintenance capital  6,357     28,607      5,582     38,847
      Fort Chicago Power
       distributable cash, after
       maintenance capital
       expenditures and debt service  4,327        888      8,949        503
      NRGreen distributions, prior
       to withholding for project
       development costs                440        275        880        525
      Realized foreign exchange
       gains, interest income
       and other                      3,691         44      4,347        370
    -------------------------------------------------------------------------
                                     48,650     61,052     88,226    112,923
    Cash outflows
      General and administrative     (3,825)    (4,198)    (8,454)    (7,264)
      Interest and other finance     (2,669)    (3,437)    (5,632)    (8,491)
      Taxes                          (2,652)   (11,091)    (2,690)   (11,224)
      Principal repayments on
       senior debt                     (885)      (761)    (1,821)    (1,564)
    -------------------------------------------------------------------------
                                    (10,031)   (19,487)   (18,597)   (28,543)
    -------------------------------------------------------------------------

    Distributable cash(1)            38,619     41,565     69,629     84,380
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Distributable cash per
     Unit ($)(2)                       0.29       0.31       0.52       0.64
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Distributions paid/payable       33,788     33,183     67,301     66,124
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Distributions paid/payable
     per Unit ($)                      0.25       0.25       0.50       0.50
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Distributable Cash Footnotes:

    (1) Distributable cash is not a standard measure under generally accepted
        accounting principles in Canada and may not be comparable to similar
        measures presented by other entities. Distributable cash represents
        the cash available to Fort Chicago for distribution to holders of
        Units after providing for debt service obligations and any capital
        expenditures that are not growth-oriented or recoverable but does not
        include distribution reserves, if any, available in Fort Chicago's
        jointly held businesses, or project development costs, which
        represent discretionary costs, the recoverability of which has not
        been established, incurred to assess the commercial viability of new
        greenfield business initiatives unrelated to the Partnership's
        operating businesses. Distributable cash is an important measure used
        by the investment community to assess the source and sustainability
        of Fort Chicago's cash distributions and should be used to supplement
        other performance measures prepared in accordance with generally
        accepted accounting principles in Canada. See the following table for
        the reconciliation of distributable cash to cash flow from operating
        activities.
    (2) The number of Units used to calculate distributable cash per Unit is
        based on the average number of Units outstanding at each record date.
        For the three months ended June 30, 2009, the average number of Units
        outstanding for this calculation was 135,207,357 (2008 - 132,788,996)
        and 137,468,978 (2008 - 136,446,174) on a basic and diluted basis,
        respectively. For the six months ended June 30, 2009, the average
        number of units outstanding for this calculation was 134,659,117
        (2008 - 132,302,721) and 136,920,738 (2008 - 136,464,593) on a basic
        and diluted basis, respectively. The number of Units outstanding
        would increase by 2,261,621 (2008 - 2,261,621) Units if the
        outstanding Convertible Debentures as at June 30, 2009 were converted
        into Units.



    Fort Chicago Energy Partners L.P.
    -------------------------------------------------------------------------

    Reconciliation of Distributable Cash to Cash Flow from Operating
    Activities
    -------------------------------------------------------------------------
                                    Three months ended      Six months ended
                                               June 30               June 30
    -------------------------------------------------------------------------
    ($ Thousands; unaudited)           2009       2008       2009       2008
    -------------------------------------------------------------------------

    Consolidated cash flow from
     operating activities            33,227     39,512     77,607    135,111
    Add (deduct): Cash flow
     generated from operating
     activities applicable to
     jointly held businesses(1)      (3,914)     8,236    (40,883)   (45,168)
    -------------------------------------------------------------------------
    Cash flow from operating
     activities applicable to
     wholly-owned businesses(2)      29,313     47,748     36,724     89,943

    Add (deduct) amounts applicable
     to wholly-owned businesses:
      Project development costs       3,202      3,386      5,966      5,429
      Change in non-cash working
       capital                          756     (6,323)    17,709     (7,446)
      Principal repayments on
       senior notes                  (1,516)    (1,357)    (3,080)    (2,756)
      Maintenance capital
       expenditures                     231     (3,938)        18     (7,450)
      Distributions earned greater
       than distributions
       received(3)                    6,633      2,049     12,292      6,660
    -------------------------------------------------------------------------

    Distributable cash               38,619     41,565     69,629     84,380
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Reconciliation of Distributable Cash to Cash Flow from Operating
    Activities Footnotes:

    (1) Represents the cash flow from operating activities applicable to
        jointly held businesses which is not under the sole control of the
        Partnership and, as a consequence, is not included in distributable
        cash until such time as distributions are declared by the jointly
        held businesses.
    (2) Net of support payments made to Alliance Canada Marketing of
        $1.3 million and $4.1 million for the three and six months ended
        June 30, 2009 respectively (2008 - $0.7 million and $1.7 million,
        respectively).
    (3) Represents the difference between distributions declared by jointly
        held businesses and distributions received.
    




For further information:

For further information: Stephen H. White, President and C.E.O., Fort
Chicago Energy Partners L.P., Livingston Place, Suite 440, 222 - 3rd Avenue
S.W., Calgary, AB, T2P 0B4, Phone: (403) 296-0140, Fax: (403) 213-3648,
www.fortchicago.com

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