KMP Declares Quarterly Distribution of $0.83 Per Unit



    
    Announces Agreement to Buy Trans Mountain Pipeline
    

    HOUSTON, April 18 /CNW/ -- Kinder Morgan Energy Partners, L.P. (NYSE:  
KMP) today declared a cash distribution per common unit of $0.83 ($3.32
annualized) payable on May 15, 2007, to unitholders of record as of April 30,
2007.  The distribution represents a 2.5 percent increase over the first
quarter 2006 cash distribution per unit of $0.81 ($3.24 annualized).
    KMP reported first quarter distributable cash flow before certain items
of $185.8 million, 1 percent less than the $187.6 million recorded for the
same period in 2006.  Certain items in the first quarter resulted in a net
loss of $1.4 million and included refinancing debt at the Red Cedar Gathering
Company, and insurance costs and recoveries associated with hurricanes Katrina
and Rita.  First quarter net income before certain items was $216.3 million
versus $246.7 million for the comparable period last year.  Net income
including certain items was $214.9 million compared to $246.7 million for the
first quarter of 2006.
    Chairman and CEO Richard D. Kinder said, "KMP had a good first quarter,
led by strong performances from our products and natural gas pipelines
business units.  In total, first quarter segment earnings before DD&A were
almost $503 million, up 5 percent from $481.1 million in the first quarter of
2006.  Also during the quarter, we continued to make progress on several large
infrastructure projects to position KMP for future growth, as we plan to
invest over $6 billion in new infrastructure and expansion projects over the
next four years alone.  Additionally, we are excited to announce that the
boards of directors of both KMP and Kinder Morgan, Inc. (NYSE:   KMI) today have
approved KMP's plan to purchase the Trans Mountain pipeline system from KMI."

    
    Overview of Business Segments
    
    The Products Pipelines segment produced first quarter earnings before
DD&A of $143.2 million, up 14 percent from $125.9 million during the
comparable period a year ago and slightly above its budget for the quarter. 
"This segment had a strong quarter, with virtually all of the assets in this
business unit producing better results than in the first quarter last year,"
Kinder said.  Growth was driven by the North System, Central Florida Pipeline,
the West Coast and Southeast terminals, and transmix operations.  This segment
also realized additional contributions from the Cochin pipeline system as a
result of the transaction to increase its ownership stake in the pipeline to
100 percent.
    Total refined products revenues increased by 6.1 percent over the first
quarter of 2006, while volumes were down 1.3 percent.  Excluding Plantation
Pipe Line Company, which continued to be impacted by an alternative pipeline
that began service in the second quarter last year, revenues were up 7.1
percent and volumes were up almost 1 percent.  Compared to the first quarter
of 2006, Central Florida revenues increased by 13 percent and volumes were up
4.5 percent, and Pacific revenues increased 7.4 percent with volumes up 1.3
percent.  Arizona volumes were up 8 percent quarter over quarter due to the
expansion of the East Line which came online during the summer of 2006.  A 29
percent increase in North System volumes attributable to both higher propane
and refinery deliveries led to a 31 percent increase in revenues.
    The Natural Gas Pipelines segment delivered first quarter segment
earnings before DD&A of $135.7 million, down 5 percent from an exceptionally
strong first quarter in 2006 of $143.5 million, but above its plan for the
quarter. "Results for the quarter were driven by the Texas Intrastate Pipeline
Group, which generated more than half of this segment's earnings before DD&A,
and better than expected performance from our Casper-Douglas processing
operations in Wyoming," Kinder said.  The Texas intrastates realized solid
sales margins on renewal and incremental contracts, higher value from storage
activities and greater processing earnings.  Commercial volumes on the
intrastates increased quarter over quarter due to higher utilization of
capacity by new and existing customers.
    Transport volumes for the segment increased by 12 percent over the first
quarter a year ago.
    The CO2 segment produced first quarter earnings before DD&A of $125.4
million, up 3 percent from $121.7 million in the same period a year ago, but
below its budget for the quarter.  "Segment highlights included increased oil
production at the Yates Field and a 5 percent increase in natural gas liquids
(NGL) sales volumes compared to the first quarter of 2006," Kinder said.  "We
continue to be disappointed in the decline in oil production at SACROC, but
this quarter's decrease versus the comparable period a year ago was partially
offset by higher NGL sales volumes at SACROC, including a record month in
March."
    Average oil production at Yates increased by over 4 percent compared to
the first quarter last year to 26.1 thousand barrels per day (MBbl/d), and
decreased at SACROC by over 4 percent to 29.9 MBbl/d.
    The CO2 segment is one of the only areas where KMP is exposed to
commodity price risk, but that risk is mitigated by a long-term hedging
strategy intended to generate more stable realized prices.  The realized
weighted average oil price per barrel, with all hedges designated for oil, was
$35.17 for the quarter, and the realized weighted average NGL price per
barrel, with none of the hedges designated for NGLs, was $41.71.
    The Terminals segment reported a 10 percent increase in first quarter
earnings before DD&A to $98.7 million compared to almost $90 million for the
same period a year ago, but slightly below its budget for the quarter. "Growth
in this segment was driven by both acquisitions and internal growth, offset
somewhat by weaker performances from the Mid-Atlantic terminals and our Texas
petcoke terminals," Kinder said.
    Segment highlights included strong results at the Pasadena/Galena Park
liquids terminal complex on the Houston Ship Channel and improved performance
from the Lower River Region terminals, which had limited operations during the
first quarter last year due to hurricane damage.  In addition, expansions
resulted in higher ethanol throughput at the Chicago, Philadelphia, Perth
Amboy, N.J., and Pasadena, Texas, terminals.  Acquisitions made since the
first quarter last year included the purchase of rail terminals along the
Houston Ship Channel and in southern California, and 14 steel-related terminal
facilities in Chicago and elsewhere in the United States.

    
    Outlook
    
    KMP previously announced that it expects to declare cash distributions of
$3.44 per unit for 2007.  This projection includes contributions from assets
currently owned by KMP and does not include any benefits from unidentified
acquisitions.  Distributions per unit are expected to grow about 6 percent in
2007 with growth accelerating in the fourth quarter.

    
    News
    Products Pipelines
     (*) Today, KMP announced it will acquire the Trans Mountain pipeline
       system from KMI for approximately US$550 million.  The transaction,
       which is expected to close this month, was approved by the independent
       members of the boards of directors of both KMI and Kinder Morgan
       Management, LLC (KMR) following the receipt by each board of separate
       fairness opinions from different investment banks.  The Trans Mountain
       pipeline system, which transports crude oil and refined products from
       Edmonton, Alberta, to marketing terminals and refineries in British
       Columbia and Washington state, recently completed a pump station
       expansion and currently transports approximately 260,000 barrels per
       day. An additional expansion that will increase the pipeline capacity
       to 300,000 barrels per day is expected to be in service by late 2008.
       Combined, these projects, including enhancements to the Puget Sound
       system and other system modifications, represent approximately C$800
       million in capital investments.  Some of these investments have
       already been incurred by KMI.  With growth in oilsands production and
       strong demand from West Coast markets, KMP intends to continue to work
       with customers to further expand Trans Mountain.

     (*) KMP entered into a long-term agreement with a consortium of airlines
       this week to construct a 9-mile, 8-inch diameter pipeline and related
       storage facilities to connect Tampa International Airport with the
       company's Tampa refined products terminal.  KMP will invest
       approximately $25 million to build the new pipeline that will be
       capable of transporting more than 30,000 barrels per day of jet fuel
       and a new tank that will increase storage capacity at its Tampa
       terminal by about 45 percent to 386,000 barrels.  This project is
       expected to be fully completed and in service in the fourth quarter of
       2008.

     (*) KMP closed the transaction with BP in the first quarter that increased
       its ownership stake in the Cochin Pipeline System to 100 percent.  KMP
       now operates the 1,900-mile, multi-product pipeline that is expected
       to play an integral role in the future supply of propane in North
       America.

    Natural Gas Pipelines
    
    KMP has several significant natural gas pipeline projects under
construction, all of which are supported by long-term contracts.

    
     (*) In February, KMP began service on the second segment of the first leg
       of the Rockies Express Pipeline (REX), a 192-mile section of 42-inch
       diameter pipeline from the Wamsutter Hub in Wyoming to the Cheyenne
       Hub in Colorado.  Approximately 328 miles of the project, which
       originated at the Meeker Hub in Colorado, are now in service,
       transporting up to 500,000 dekatherms of natural gas per day (Dth/d).
       In other REX news, the Federal Energy Regulatory Commission (FERC)
       recently issued a favorable final environmental review for the next
       713-mile segment of the project, which will run from Weld County,
       Colo., to Audrain County, Mo.  REX-West, which expects to receive the
       FERC certificate this week that will allow construction to begin, is
       expected to be in service in January 2008.  A joint venture of KMP,
       Sempra Pipelines and Storage and ConocoPhillips, the $4.4 billion REX
       project will transport up to 1.8 billion cubic feet per day (Bcf/d) of
       natural gas through approximately 1,678 miles of pipeline.  Subject to
       receiving required regulatory approvals, the entire project is
       expected to be fully operational in June 2009.

     (*) Also in February, the FERC approved Midcontinent Express Pipeline's
       (MEP) request to begin the pre-filing review under the National
       Environmental Policy Act for its proposed $1.3 billion project.
       Pending necessary regulatory approvals, the approximately 500-mile
       pipeline is expected to be in service by February 2009 and have an
       initial transportation capacity of 1.4 Bcf/day.  The pipeline is
       designed to originate near Bennington, Okla., and terminate in Butler,
       Ala.  MEP is a joint venture of KMP and Energy Transfer Partners.

     (*) In January, the FERC approved a draft environmental impact statement
       for the Kinder Morgan Louisiana Pipeline, a proposed 136-mile pipeline
       that will transport up to 3.2 Bcf/day of gas from the Sabine Pass
       liquefied natural gas import terminal and connect with various
       interstate and intrastate pipelines.  The $500 million project will be
       built in phases with total completion scheduled for the second quarter
       of 2009.

     (*) KMP will invest approximately $29 million to construct its Colorado
       Lateral expansion project, a 38-mile pipeline that will transport
       natural gas from the Cheyenne Hub to various delivery points in
       Greeley, Colo.  The pipeline will have an initial capacity of 74,000
       Dth/d, and firm-contracted service is expected to begin in the third
       quarter of 2008.

    Terminals
     (*) KMP announced an agreement in April to purchase Vancouver Wharves, a
       bulk marine terminal, from British Columbia Railway Company, a crown
       corporation owned by the Province of British Columbia.  Located in the
       Port of Vancouver, the terminal facilities include rail
       infrastructure, dry-bulk and liquids storage, and material handling
       systems that handle over 3.5 million tons of cargo annually.  The
       transaction is expected to close in the second quarter of 2007.

     (*) KMP entered into a long-term agreement in February with Green Earth
       Fuels and will invest up to $100 million to build new tanks that will
       handle approximately 8 million barrels of biodiesel production at the
       company's terminals on the Houston Ship Channel, the Port of New
       Orleans and in New York Harbor.  Green Earth Fuels has begun
       construction on an 86 million gallon facility at KMP's Galena Park
       Terminal on the Houston Ship Channel that is expected to commence
       operations in July 2007.

    Other
     (*) KMP recognized its 10-year anniversary Feb. 14, 2007.  During those 10
       years, KMP delivered an average annual return to unitholders of 30
       percent and grew its enterprise value from $325 million to over $16
       billion.

    Kinder Morgan Management, LLC
    
    Shareholders of Kinder Morgan Management, LLC (NYSE:   KMR) will also
receive a $0.83 distribution ($3.32 annualized), payable on May 15, 2007, to
shareholders of record as of April 30, 2007.  The distribution to KMR
shareholders will be paid in the form of additional KMR shares.  The
distribution is calculated by dividing the cash distribution to KMP
unitholders by KMR's average closing price for the 10 trading days prior to
KMR's ex-dividend date.
    Kinder Morgan Energy Partners, L.P. is one of the largest publicly traded
pipeline limited partnerships in America.  KMP owns an interest in or operates
approximately 26,000 miles of pipelines and more than 150 terminals.  Its
pipelines transport more than 2 million barrels/day of gasoline and other
petroleum products and up to 7 billion cubic feet/day of natural gas.  Its
terminals handle over 90 million tons of coal and other dry-bulk materials
annually and have a liquids storage capacity of about 70 million barrels for
petroleum products and chemicals.  KMP is also the leading provider of CO2 for
enhanced oil recovery projects in North America.
    The general partner of KMP is owned by Kinder Morgan, Inc., one of the
largest energy transportation, storage and distribution companies in North
America.  Combined, the two companies have an enterprise value of more than
$35 billion.

    Please join KMP at 4:30 p.m. Eastern Time on Wednesday, April 18, at
http://www.kindermorgan.com for a LIVE webcast conference call on the
company's first quarter earnings.

    The non-generally accepted accounting principles financial measures of
segment earnings before depletion, depreciation and amortization (DD&A), and
distributable cash flow or distributable cash flow per unit, are presented in
this earnings release.  We define segment earnings before DD&A as segment
earnings plus DD&A and amortization of excess cost of equity investments.  We
define distributable cash flow to be pretax income before DD&A less cash taxes
paid and sustaining capital expenditures for KMP and Rockies Express, our
equity method investee.  The amounts included in the calculation of this
measure are computed in accordance with generally accepted accounting
principles (GAAP), with the exception of "sustaining capital expenditures,"
which is not a defined term under GAAP. Consistent with the partnership
agreement of Kinder Morgan Energy Partners, L.P., sustaining or maintenance
capital expenditures are defined as capital expenditures (as defined by GAAP)
which do not increase the capacity of an asset.  We routinely calculate and
communicate these measures to investors.  We believe that continuing to
provide this information results in consistency in our financial reporting. In
addition, we believe that these measures are useful to investors because they
enhance the investors' overall understanding of our current financial
performance and our prospects for future performance.  Specifically, we
believe that these measures provide investors an enhanced perspective on the
operating performance of our assets and the cash that our businesses are
generating.  Reconciliations of segment earnings before DD&A to segment
earnings, and distributable cash per unit to net income per unit are provided
in the earnings release.  Segment earnings before DD&A should be considered in
conjunction with segment earnings, as defined by GAAP, and distributable cash
per unit should be considered in conjunction with earnings per unit as defined
by GAAP.

    This news release includes forward-looking statements. Although Kinder
Morgan believes that its expectations are based on reasonable assumptions, it
can give no assurance that such assumptions will materialize.  Important
factors that could cause actual results to differ materially from those in the
forward-looking statements herein are enumerated in Kinder Morgan's Forms 10-K
and 10-Q as filed with the Securities and Exchange Commission.



    
              Kinder Morgan Energy Partners, L.P. and Subsidiaries
                  Preliminary Consolidated Statement of Income
                                   (Unaudited)
                     (in thousands except per unit amounts)


                                                  Three Mos. Ended Mar. 31
                                                   2007              2006

    Revenues                                    $2,152,243        $2,391,601

    Costs and Expenses
      Operating expenses                         1,633,519         1,901,536
      Depreciation, depletion and amortization     127,970            92,721
      General and administrative                    65,771            60,883
      Taxes, other than income taxes                30,864            31,267
      Other expense (income)                        (2,219)              ---
                                                 1,855,905         2,086,407
    Operating Income                               296,338           305,194

    Other Income/(Expense)
      Earnings from equity investments              19,018            24,721
      Amortization of excess cost of equity
       investments                                  (1,457)           (1,414)
      Interest, net                                (90,056)          (75,706)
      Other, net                                        89             1,775
      Minority interest                             (2,568)           (2,370)
    Income before income taxes                     221,364           252,200
    Income tax expense                              (6,488)           (5,491)

    Net Income                                    $214,876          $246,709

    Calculation of Limited Partners'
     Interest in Net Income:
      Net Income                                  $214,876          $246,709
      Less:  General Partner's Interest
       in Net Income                              (139,707)         (129,528)
      Limited Partners' Net Income                 $75,169          $117,181

    Calculation per Limited Partner Unit
     (Fully Diluted):
      Net Income per unit                            $0.33             $0.53

      Number of Units Used in Computation          231,261           221,080

    Additional per unit information:

      Net Income                                     $0.33             $0.53
      Depreciation, depletion and amortization        0.56              0.43
      Book/(Cash) Taxes - Net                         0.02              0.01
      Sustaining capital expenditures [A]            (0.11)            (0.12)
      Net income before DD&A and net
       taxes, less sustaining capex [B]              $0.80             $0.85
      Declared distribution                          $0.83             $0.81

      Sustaining Capex                              26,772            25,665

    [A] Sustaining capital expenditures are defined as capital expenditures
        which do not increase the capacity of an asset
    [B] Includes Rockies Express DD&A of $1,165



              Kinder Morgan Energy Partners, L.P. and Subsidiaries
              Preliminary Earnings Contribution by Business Segment
                                   (Unaudited)
                                 (in thousands)

                                                   Three Mos. Ended Mar. 31
                                                    2007              2006
    Segment Earnings Before DD&A and
     Amort. of Excess Investments
      Products Pipelines                          $143,171          $125,895
      Natural Gas Pipelines                        135,731           143,532
      CO2                                          125,412           121,668
      Terminals                                     98,662            89,969
        Total                                     $502,976          $481,064

    Segment DD&A and Amort. of Excess
     Investments:
      Products Pipelines                           $23,455           $21,083
      Natural Gas Pipelines                         16,074            16,002
      CO2                                           69,375            39,776
      Terminals                                     20,523            17,274
        Total                                     $129,427           $94,135

    Segment Earnings Contribution:
      Products Pipelines                         $119,716           $104,812
      Natural Gas Pipelines                       119,657            127,530
      CO2                                          56,037             81,892
      Terminals                                    78,139             72,695
      General and Administrative                  (64,108)           (60,883)
      Interest, net                               (91,142)           (76,967)
      Minority Interest                            (2,047)            (2,370)
      Certain Items:
        Loss on Debt Retirement                    (1,001)               ---
        Other [A]                                    (375)               ---
          Sub-total Certain Items                  (1,376)               ---
      Net income                                 $214,876           $246,709
        Less:  General Partner's Interest
         in Net Income                           (139,707)          (129,528)
        Limited Partners' Net Income              $75,169           $117,181

      Net income before certain items             216,252            246,709
        Less:  General Partner's Interest
         in Net Income before certain items      (139,721)          (129,528)
        Limited Partners' Net Income before
         Certain Items                             76,531            117,181
        Depreciation, depletion and
         amortization [B]                         130,592             94,135
        Book/(Cash) Taxes - Net                     5,491              1,950
        Sustaining capital expenditures           (26,772)           (25,665)
      DCF before certain items                    185,842            187,601

      Net income/unit before certain items          $0.33              $0.53
      DCF/unit before certain items                 $0.80              $0.85
      Number of Units Used in Computation         231,261            221,080

    [A] Hurricanes Katrina/Rita, net of minority interest
    [B] Includes Rockies Express DD&A of $1,165


                                Volume Highlights
                   (historical pro forma for acquired assets)


                                                    Three Mos. Ended Mar. 31
                                                     2007               2006
    Products Pipelines
      Gasoline                                      108.5              111.6
      Diesel                                         38.8               38.7
      Jet Fuel                                       30.2               29.5
        Total Refined Product Volumes (MMBbl)       177.5              179.8
      NGL's                                          16.7               16.7
        Total Delivery Volumes (MMBbl) [A]          194.2              196.5

    Natural Gas Pipelines [B]
      Transport Volumes (Bcf)                       378.3              336.7
      Sales Volumes (Bcf)                           209.0              223.8

    CO2
      Delivery Volumes (Bcf) [C]                    165.7              172.4
      Sacroc Oil Production - Gross (MBbl/d) [D]     29.9               31.3
      Sacroc Oil Production - Net (MBbl/d) [E]       24.9               26.1
      Yates Oil Production Gross - (MBbl/d) [D]      26.1               25.0
      Yates Oil Production - Net (MBbl/d) [E]        11.6               11.1
      NGL Sales Volumes (MBbl/d) [F]                  9.7                9.3
      Realized Weighted Average Oil
       Price per Bbl [G] [H]                       $35.17             $30.47
      Realized Weighted Average NGL
       Price per Bbl [H]                           $41.71             $41.35

    Terminals
      Liquids Leaseable Capacity (MMBbl)             43.6               42.8
      Liquids Utilization %                          98.5%              97.8%
      Bulk Transload Tonnage (MMtons)                19.6               21.2

    [A] Includes Pacific, Calnev, Plantation, Central Florida, Heartland,
        North System, Cochin and Cypress
    [B] Includes KMIGT, Texas Intrastates, KMNTP, Monterrey, Trailblazer
        and TransColorado
    [C] Includes Cortez, Central Basin, CRC, CLPL and PCPL pipeline volumes
    [D] Represents 100% production from the field
    [E] Represents Kinder Morgan's net share of the production from the field
    [F] Net to Kinder Morgan
    [G] Includes all Kinder Morgan crude oil properties
    [H] Hedge gains/losses for Oil and NGLs are included with Crude Oil



               KINDER MORGAN ENERGY PARTNERS, L.P. AND SUBSIDIARIES
                PRELIMINARY ABBREVIATED CONSOLIDATED BALANCE SHEET
                                   (Unaudited)
                                    (Millions)

                                                  Mar. 31,          Dec. 31,
                                                    2007              2006
    ASSETS

    Cash and cash equivalents                         $22                $14
    Other current assets                            1,001              1,023
    Property, Plant and Equipment, net              9,615              9,445
    Investments                                       415                425
    Deferred charges and other assets               1,313              1,339
    TOTAL ASSETS                                  $12,366            $12,246

    LIABILITIES AND PARTNERS' CAPITAL

    Notes payable and current maturities
     of long-term debt                               $625             $1,359
    Other current liabilities                       1,427              1,526
    Long-term debt                                  5,415              4,384
    Value of interest rate swaps                       43                 43
    Other                                             861                861
    Minority interest                                  49                 51
    Partners' Capital
      Accumulated Other Comprehensive  Loss          (873)              (841)
      Other Partners' Capital                       4,819              4,863
        Total Partners' Capital                     3,946              4,022
    TOTAL LIABILITIES AND PARTNERS'
     CAPITAL                                      $12,366            $12,246


    Total Debt, net of cash and cash
     equivalents, and excluding the value
     of interest rate swaps                        $6,018             $5,729

    Total Capitalization (Excl. Accum. OCI)       $10,886            $10,643

    Debt to Total Capitalization                     55.3%              53.8%

    Total Debt, net of cash and cash
     equivalents, and excluding the value
     of interest rate swaps                        $6,018             $5,729

    Segment Earnings Before DD&A and
     certain items                                 $1,966             $1,944
    G&A                                             $(221)              (218)
    EBITDA [A]                                     $1,745             $1,726

    Debt to EBITDA                                   3.45               3.32

    [A] 2007 EBITDA is last twelve months

    




For further information:

For further information: Larry Pierce, media relations, +1-713-369-9407,
 or Mindy Mills, investor relations, +1-713-369-9490, both of Kinder Morgan 
Energy Partners, L.P. Web Site: http://www.kindermorgan.com

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Kinder Morgan Energy Partners, L.P.

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