Pipeline Group
Our approximately 43,000-mile pipeline system connects the nation’s key natural gas supply areas to the largest consuming regions in the United States. Our Pipeline Group provides natural gas transmission, storage, and related services through interstate natural gas pipelines across the country. Our system represents about 20 percent of the total interstate pipeline mileage in the United States. Every day, we move about 1.8 billion cubic feet of gas through our system and touch more than 25 percent of all the gas delivered to U.S. consumers.
To continue to meet that commitment, as well as the growing demand for natural gas, we are expanding our system. In fact, we’re nearing completion of the largest build-out of pipeline projects in our history — $8 billion of new investments. One of the largest of these projects is Ruby Pipeline, a new 680-mile, 42-inch pipeline stretching from the Rockies to the West Coast that will be the first carbon-neutral interstate natural gas pipeline in U.S. history. It is expected to be in service during the summer of 2011.
Exploration & Production Company
Our E&P Company explores for, acquires, develops, and produces natural gas, oil and related products in key regions in the United States, Brazil, and Egypt. We are one of North America’s largest independent natural gas producers, and we’re involved in the entire E&P value chain, from drilling to production. We controlled about 3.7 million net leasehold acres at the end of 2010 and had proved natural gas and oil reserves of approximately 3.4 trillion cubic feet equivalent, which is an increase of 22 percent over 2009. Our 2010 production averaged about 782 million cubic feet equivalent per day.
We have grown our inventory of drilling opportunities by 30 percent annually from 2007 to 2009. And in 2010, we grew our inventory by more than 30 percent, reaching a total of approximately 8 trillion cubic feet equivalent. We have also successfully built large positions in four core domestic programs. In 2011, we’ll continue to focus on our domestic drilling inventory in the areas of Eagle Ford in South Texas; Haynesville in Louisiana and East Texas; Altamont in the Uinta Basin of Utah; and Wolfcamp in the Permian Basin of Texas and New Mexico, with an increased emphasis on our oil programs.
Midstream
El Paso’s Midstream Group is focused on providing access to supplies for our pipelines and enhancing growth for the E&P business by meeting the increased need for infrastructure between the wellhead and our pipelines. Our midstream strategy is to build and develop profitable midstream assets by leveraging El Paso’s existing pipeline and E&P business expertise and resources. We are developing greenfield gathering, compression, treating, and processing services that provide solid returns on invested capital.
We are also looking at acquisitions where they make sense, fit our strategy, and help us maximize the value of our existing assets. Our expertise and established asset position will allow us to provide competitive, creative, and high-value midstream solutions to the industry for years to come.
El Paso Corporation to Pursue Separation into Two Publicly Traded Companies
In May 2011, El Paso announced plans to spin off our E&P company, creating two separate and independent publicly traded companies by year-end 2011. Following the completion of the spinoff, El Paso Corporation will be comprised of El Paso’s Pipeline Group, its Midstream Group, and its general and limited partner interests in El Paso Pipeline Partners. The separation marks the beginning of an exciting new chapter in El Paso’s history that will enable us to take the businesses to new heights, continue to provide our shareholders with superior returns, and create even brighter futures for our employees.