Investments

Our investments primarily consist of equity investments where we hold significant influence over investee actions and for which we apply the equity method of accounting. As of December 31, 2018 and 2017, our investments consisted of the following (in millions):



	December 31,
	2018		2017
Citrus Corporation	$	1,708	$	1,698
SNG	1,536		1,495
Ruby	750		774
NGPL Holdings LLC	733		687
Gulf LNG Holdings Group, LLC	361		461
Plantation Pipe Line Company	344		331
Utopia Holding LLC	333		276
EagleHawk	299		314
Gulf Coast Express Pipeline LLC	240		—
MEP	235		253
Red Cedar Gathering Company	191		187
Watco Companies, LLC	185		182
Double Eagle Pipeline LLC	140		149
Liberty Pipeline Group LLC	66		71
Bear Creek Storage	65		63
Sierrita Gas Pipeline LLC	55		55
Permian Highway Pipeline	45		—
FEP	44		112
All others	151		190
Total investments	$	7,481	$	7,298

As shown in the investment balance table above and the earnings from equity investments table below, our significant equity investments, as of December 31, 2018 consisted of the following:

•

Citrus Corporation—We own a 50% interest in Citrus Corporation, the sole owner of Florida Gas Transmission Company, L.L.C. (Florida Gas). Florida Gas transports natural gas to cogeneration facilities, electric utilities, independent power producers, municipal generators, and local distribution companies through a 5,300-mile natural gas pipeline. Energy Transfer Partners L.P. operates Florida Gas and owns the remaining 50% interest in Citrus;


•	SNG—We operate SNG and own a 50% interest in SNG; and Evergreen Enterprise Holdings, LLC, a subsidiary of Southern Company, owns the remaining 50% interest;


•	Ruby—We operate Ruby and own the common interest in Ruby, the sole owner of the Ruby Pipeline natural gas transmission system. Pembina Pipeline Corporation (Pembina) owns the remaining interest in Ruby in the form of a convertible preferred interest. If Pembina converted its preferred interest into common interest, we and Pembina would each own a 50% common interest in Ruby;


•	NGPL Holdings LLC— We operate NGPL Holdings LLC and own a 50% interest in NGPL Holdings LLC, the indirect owner of NGPL and certain affiliates, collectively referred to in this report as NGPL, a major interstate natural gas pipeline and storage system. The remaining 50% interest is owned by Brookfield;

•

Gulf LNG Holdings Group, LLC—We operate Gulf LNG Holdings Group, LLC and own a 50% interest in Gulf LNG Holdings Group, LLC, the owner of a LNG receiving, storage and regasification terminal near Pascagoula, Mississippi, as well as pipeline facilities to deliver vaporized natural gas into third party pipelines for delivery into various markets around the country. The remaining 50% interest is owned by a variety of investment entities, including subsidiaries of The Blackstone Group, LP; Warburg Pincus, LLC; Kelso and Company; and Chatham Asset Management, LLC, which is directed by Chatham Asset GP, LLC;

•

Plantation—We operate Plantation and own a 51.17% interest in Plantation, the sole owner of the Plantation refined petroleum products pipeline system. A subsidiary of Exxon Mobil Corporation owns the remaining interest. Each investor has an equal number of directors on Plantation’s board of directors, and board approval is required for certain corporate actions that are considered substantive participating rights; therefore, we do not control Plantation, and account for the investment under the equity method;


•	Utopia Holding L.L.C. — We operate Utopia Holding L.L.C. and own a 50% interest in Utopia Holding L.L.C. Riverstone Investment Group LLC owns the remaining 50% interest;


•	BHP Billiton Petroleum (Eagle Ford Gathering) LLC, (EagleHawk)—We own a 25% interest in EagleHawk, the sole owner of natural gas and condensate gathering systems serving the producers of the Eagle Ford shale formation. A subsidiary of BHP Billiton Petroleum (Tx Gathering), LLC operates EagleHawk and owns the remaining 75% ownership interest;

•

Gulf Coast Express Pipeline LLC — We operate Gulf Coast Express Pipeline LLC and own 35% interest of Gulf Coast Express Pipeline LLC indirectly through Kinder Morgan Texas Pipeline LLC, our 100% subsidiary. DCP GCX Pipeline LLC, an indirect subsidiary of DCP Midstream, owns 25% interest; Targa GCX Pipeline LLC, an indirect subsidiary of Targa Resources Corp., owns 25% interest and Altus Midstream Company, an indirect subsidiary of Apache Corporation, owns 15% interest;


•	MEP—We operate MEP and own a 50% interest in MEP, the sole owner of the MEP natural gas pipeline system. The remaining 50% ownership interest is owned by subsidiaries of Energy Transfer Partners L.P.;


•	Red Cedar Gathering Company—We own a 49% interest in Red Cedar Gathering Company, the sole owner of the Red Cedar natural gas gathering, compression and treating system. The Southern Ute Indian Tribe owns the remaining 51% interest and serves as operator of Red Cedar;

•

Watco Companies, LLC—We hold a preferred and common equity investment in Watco Companies, LLC, the largest privately held short line railroad company in the U.S. We own 100,000 Class A and 50,000 Class B preferred shares and pursuant to the terms of the investment, receive priority, cumulative cash and stock distributions from the preferred shares at a rate of 3.25% and 3.00% per quarter, respectively, and participate partially in additional profit distributions at a rate equal to 0.4%. Neither class holds any voting powers, but do provide us certain approval rights, including the right to appoint one of the members to Watco’s board of managers. In addition to the senior interests, we also hold approximately 13,000 common equity units, which represents a 3.2% common ownership;


•	Double Eagle Pipeline LLC - We own a 50% equity interest in Double Eagle Pipeline LLC. The remaining 50% interest is owned by Magellan Midstream Partners;


•	Liberty Pipeline Group, LLC (Liberty) —We own a 50% interest in Liberty. ETC NGL Transport, LLC, a subsidiary of Energy Transfer Partners, L.P. owns the remaining 50% interest and serves as operator of Liberty;


•	Bear Creek Storage—We own a combined 75% interest in Bear Creek through: our wholly owned subsidiary’s (TGP) 50% interest and an additional 25% indirect interest through our 50% equity interest in SNG, which owns the remaining 50% interest;


•	Sierrita Gas Pipeline LLC — We operate Sierrita Gas Pipeline LLC and own a 35% interest in Sierrita Gas Pipeline LLC. MGI Enterprises U.S. LLC, a subsidiary of PEMEX, owns 35%; and MIT Pipeline Investment Americas, Inc., a subsidiary of Mitsui & Co., Ltd, owns 30%;

•

Permian Highway Pipeline — We operate Permian Highway Pipeline and own a 50% interest of Permian Highway Pipeline indirectly through KMTP, our wholly owned subsidiary. BCP PHP, LLC (BCP), a portfolio company of Blackstone Energy Partners, owns the remaining 50% interest. An affiliate of an anchor shipper exercised its option in January 2019 to acquire a 20% equity interest in the project, bringing KMTP’s and BCP’s ownership interest to 40% each. Altus Midstream Company (Altus Midstream) (a gas gathering, processing and transportation company formed by shipper Apache Corporation) has an option to acquire an equity interest in the project from the initial partners by September 2019. If Altus Midstream exercises its option, KMTP, BCP and Altus Midstream will each hold a 26.67% ownership interest in the project. KMTP will build and operate the pipeline;


•	FEP —We own a 50% interest in FEP, the sole owner of the Fayetteville Express natural gas pipeline system. Energy Transfer Partners, L.P. owns the remaining 50% interest and serves as operator of FEP;


•	Cortez Pipeline Company—We operate the Cortez CO₂ pipeline system, and own a 52.98% interest in the Cortez Pipeline Company, the sole owner of the Cortez CO₂ pipeline system. Mobil Cortez Pipeline Inc. owns 33.25%; and Cortez Vickers Pipeline Company owns the remaining 13.77%.

Our earnings from equity investments were as follows (in millions):



	Year Ended December 31,
	2018			2017			2016
Gulf LNG Holdings Group, LLC(a)	$	209		$	47		$	48
Citrus Corporation	169			108			102
SNG	141			77			58
NGPL Holdings LLC	66			10			12
FEP	55			53			51
Plantation Pipe Line Company	55			46			37
Cortez Pipeline Company(b)	36			44			24
MEP	31			38			40
Ruby	26			44			15
Watco Companies, LLC	21			19			25
Red Cedar Gathering Company(c)	18			14			24
Utopia Holding LLC	14			—			—
Double Eagle Pipeline LLC	10			7			5
Bear Creek Storage	9			8			2
EagleHawk	7			24			10
Liberty Pipeline Group LLC	7			9			11
Sierrita Gas Pipeline LLC	7			7			7
Gulf Coast Express LLC	2			—			—
All others	4			23			26
Total earnings from equity investments	$	887		$	578		$	497
Amortization of excess costs	(95		)	(61		)	(59		)

_______


(a)	2018 amount includes our share of earnings recognized due to a ruling by an arbitration panel affecting a customer contract.


(b)	2017 and 2016 amounts include $(4) million and $9 million, respectively, representing our share of a non-cash impairment charge (pre-tax) recorded by Cortez Pipeline Company.


(c)	2017 amount includes non-cash impairment charges of $10 million (pre-tax) related to our investment.

Summarized combined financial information for our significant equity investments (listed or described above) is reported below (in millions; amounts represent 100% of investee financial information):



	Year Ended December 31,
Income Statement	2018		2017		2016
Revenues	$	5,129	$	4,703	$	4,084
Costs and expenses	3,371		3,398		3,056
Net income	$	1,758	$	1,305	$	1,028



	December 31,
Balance Sheet	2018		2017
Current assets	$	1,496	$	956
Non-current assets	23,396		22,344
Current liabilities	2,715		1,241
Non-current liabilities	9,555		10,605
Partners’/owners’ equity	12,622		11,454