U.S. pipeline operator Kinder Morgan has announced net losses of $637 million during Q2 2020 following a $1 billion impairment charge, Kallanish Energy reports.
Kinder Morgan’s losses for the first half of 2020 total $943 million after reporting declines in crude oil and natural gas production and reduced demand for refined products as a result of the Covid-19 pandemic.
The company’s net loss in the April-June period is a sharp contrast to the net profit of $518 million recorded in the same period last year. Without the impairment charge, Kinder Morgan would have posted net income of $363 million in Q2 2020.
Kinder Morgan revenue fell to $2.56 billion during Q2 2020, a year-on-year decline of 20% from $3.21 billion.
“Sharp declines in crude oil and natural gas production along with reduced demand for refined products due to the economic shutdown in the wake of the pandemic clearly affected our business and will continue to do so in the near term,” said Kinder Morgan chairman, Richard Kinder.
Kinder Morgan’s natural gas pipeline business recorded lower quarter-on-quarter contributions due to significantly reduced gas production from the Tennessee Gas Pipeline Company as a result of mild weather in the northeast and the impact of the Federal Energy Regulatory Commission rate settlement, and from the sale of the Cochin Pipeline in December 2019.
However, the company stated that two of its key natural gas projects are still on target. The Permian Highway Pipeline in Texas, which will transport up to 2.1 billion cubic feet per day of natural gas, is expected to start service in early 2021. Meanwhile, the final three units of the Elba Island LNG project are expected to be installed during this summer.
This post appeared first on Kallanish Energy News.