Shell and Kinder Morgan Announce Plans to Export LNG from the United States

HOUSTON--()--Shell US Gas & Power LLC (Shell), a subsidiary of Royal Dutch Shell plc, and Southern Liquefaction Company, LLC, a Kinder Morgan company and unit of El Paso Pipeline Partners, L.P. (NYSE: EPB), today announced their intent to form a limited liability company to develop a natural gas liquefaction plant in two phases at Southern LNG Company, LLC’s (Southern LNG) existing Elba Island LNG Terminal, near Savannah, Ga.

Subject to various corporate and regulatory approvals, Shell and Kinder Morgan affiliates have agreed to modify EPB’s Elba Express Pipeline and Elba Island LNG Terminal to physically transport natural gas to the terminal and to load the liquefied natural gas (LNG) onto ships for export.

“Kinder Morgan is delighted to be working with Shell at Elba Island on this project, which has already received Free Trade Agreement approval,” said Kinder Morgan Chairman and CEO Richard D. Kinder. “This project will facilitate further development of the abundant natural gas resources in the United States and will be a positive factor in the overall balance of trade between the U.S. and other countries.” Kinder added that the facility anticipates receiving non-Free Trade Agreement approval in due course.

“This announcement underscores how the abundance of natural gas in the U.S. is changing the energy landscape,” said Marvin Odum, President of Shell Oil Company. “With a measured, phased approach, exports of cleaner burning natural gas can help meet the world’s rising energy needs while also giving a boost to the U.S. economy.”

Once finalized, EPB, through its affiliates, will own 51 percent of the entity and operate the facility. Shell, through its affiliates, will own the remaining 49 percent and subscribe to 100 percent of the liquefaction capacity. The project will use Shell’s innovative small-scale liquefaction unit, which will be integrated with the existing Elba Island facility and enable rapid construction compared to traditional large-scale plants.

The total project is expected to have liquefaction capacity of approximately 2.5 million tonnes per year (mtpa) of LNG or 350 million cubic feet of gas per day (Mmcfd). In June 2012, the Elba Island terminal received approval from the U.S. Department of Energy (DOE) to export up to 4 mtpa (500 Mmcfd) of LNG to Free Trade Agreement (FTA) countries. In August 2012, the terminal submitted a filing to the DOE seeking approval to export up to 4 mtpa (500 Mmcfd) of LNG to non-FTA countries. Phase I of the project, approximately 1.5 mtpa (210 Mmcfd), requires no additional DOE approval.

This project combines Shell’s LNG leadership–from innovative technology to a vast global LNG portfolio and unrivaled access to strategic markets around the world–with Kinder Morgan’s unparalleled portfolio of U.S. natural gas assets and industry expertise.

As an integrated energy company, Shell has an array of long-term options for natural gas that will broaden the energy mix. This includes extracting ethane and other natural gas liquids for petrochemicals production; shipping solutions for LNG; and proprietary gas-to-liquids technology to produce fuels, lubricants and chemicals.

El Paso Pipeline Partners (NYSE: EPB) is a publicly traded pipeline limited partnership. It owns an interest in or operates more than 13,000 miles of interstate natural gas transportation pipelines in the Rockies and the Southeast, natural gas storage facilities with a capacity of nearly 100 billion cubic feet and LNG assets in Georgia. The general partner of EPB is owned by Kinder Morgan, Inc. (NYSE: KMI). Kinder Morgan is the largest midstream and the third largest energy company in North America with a combined enterprise value of approximately $100 billion. It owns an interest in or operates approximately 75,000 miles of pipelines and 180 terminals. Its pipelines transport natural gas, gasoline, crude oil, CO2 and other products, and its terminals store petroleum products and chemicals and handle such products as ethanol, coal, petroleum coke and steel. KMI owns the general partner interest of Kinder Morgan Energy Partners, L.P. (NYSE: KMP) and El Paso Pipeline Partners, L.P. (NYSE: EPB), along with limited partner interests in KMP and EPB and shares in Kinder Morgan Management, LLC (NYSE: KMR). For more information please visit www.kindermorgan.com and www.eppipelinepartners.com.

This news release includes forward-looking statements. These forward-looking statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, based on information currently available to them. Although EPB believes that these forward-looking statements 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 include those enumerated in EPB’s reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they were made, and except to the extent required by law, EPB undertakes no obligation to update or review any forward-looking statement because of new information, future events or other factors. Because of these uncertainties, readers should not place undue reliance on these forward-looking statements.

Contacts

El Paso Pipeline Partners
Richard Wheatley, (713) 420-6828
Media Relations
richard_wheatley@kindermorgan.com
www.eppipelinepartners.com
or
Peter Staples, (713) 369-9221
Investor Relations
peter_staples@kindermorgan.com
www.kindermorgan.com

Contacts

El Paso Pipeline Partners
Richard Wheatley, (713) 420-6828
Media Relations
richard_wheatley@kindermorgan.com
www.eppipelinepartners.com
or
Peter Staples, (713) 369-9221
Investor Relations
peter_staples@kindermorgan.com
www.kindermorgan.com