Enbridge Energy Partners, L.P. announced that, given the decline in the natural gas liquids ("NGL") commodity price environment, it is updating its financial outlook for full year 2012.
The Partnership expects full year adjusted net income for the current year to be between $440 million and $470 million, with adjusted EBITDA forecasted to be between $1.12 and $1.17 billion. Although the near term outlook for its natural gas business is being affected by the recent declines in NGL prices, the impact of commodity prices is significantly mitigated by the Partnership's existing commodity hedging arrangements.
The Partnership's distributable cash flow profile will be elevated by previously announced growth projects in liquids and natural gas. These accretive growth projects are secured predominantly by a long-term, low-risk commercial framework (i.e., cost-of-service or ship-or-pay contract structures), which are not significantly affected by fluctuations in commodity prices and are expected to begin phasing in during early 2013.
"The long-term outlook for the Partnership remains strong and the distribution is secure," said Mark Maki, president of the Partnership.
"Given recent events in the natural gas and NGL commodities market, our natural gas business will face challenges over our near term planning horizon. As such, we plan to reduce capital investment into the natural gas business in the near term," noted Maki.
"We continue to be very encouraged by the performance of our liquids pipeline systems with very high levels of system utilization being achieved each month. We are completing several attractive growth projects that will start growing distributable cash flow in early 2013. Management is confident in the current level of the Partnership's cash distribution and we continue to target 2 to 5 percent annual distribution growth," said Maki.
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