Profile: Brookfield Infrastructure Partners LP (BIP.N)
24 Dec 2014
Brookfield Infrastructure Partners L.P. (the partnership), incorporated on May 29, 2007, owns and operates utilities, transport and energy businesses in North and South America, Australasia and Europe. Brookfield Infrastructure has appointed Brookfield as its Service Provider to provide certain management, administrative and advisory services for a fee under the Master Services Agreement. Brookfield owns an approximate 28% interest in Brookfield Infrastructure. The Company operates in three segments: utilities, transport and energy. Utilities include regulated or contractual businesses that earn a return on their rate base. Transport is involved in the movement of freight, bulk commodities and passengers. Energy is engaged in system for the transportation, storage and handling of energy. In April 2013, John Laing Infrastructure Fund Limited acquired a 30% stake in Peterborough City Hospital, an owner and operator of hospitals, from the partnership. Effective August 21, 2014, Brookfield Infrastructure Partners LP of Bermuda acquired a 50.01% interest in Thermal Chicago Corp.
The Company’s utilities platform consists of regulated businesses, which earn a return on their asset base, as well as businesses with long-term contracts designed to generate a return on capital over the life of the contract. In all cases, it owns and operates assets that earn a return on a regulated or notionally stipulated asset base, which it refers to as rate base. Its utilities platform consists of regulated terminal operations, electricity transmission and regulated distribution. Its regulated terminal operation consists of a port facility that exports metallurgical and thermal coal mined in the central Bowen Basin region of Queensland, Australia. Its regulated terminal operation generates revenues under long-term take-or-pay contracts. These contracts include two components: a capacity charge that is allocated to users based on the percentage of total capacity for which they contract and a fixed and variable handling charge associated with operating and maintaining the terminal.
The Company’s electricity transmission operations consists of approximately 15,500 kilometers of transmission lines in North and South America. Its North American electricity transmission system consists of approximately 560 kilometers of 44 kilovolt (kV) to 230 kV transmission lines in Ontario, a 39 kilometer, 330 megawatt (MW) HVDC submarine cable in New York, and 600 kilometers of 345 kV transmission lines under development in Texas. Its South American electricity transmission system includes 100% of Chile’s 500 kV transmission lines, the highest voltage lines in the country, approximately 51% of the 220 kV lines, 86% of the 154 kV lines and 11% of the 66 kV and 110 kV lines in Chile.
The Company’s regulated distribution operations have approximately 2.1 million electricity and natural gas connections in the United Kingdom, New Zealand and Colombia. In the United Kingdom, its regulated distribution operations is an independent natural gas and electricity connections provider, comprised of approximately 1.75 million connections, principally natural gas and electricity. In South America, its electricity distribution franchise area is in the Boyaca province of Colombia, a region that is approximately 150 kilometers north of the capital, Bogota.
The Company’s transport platform consists of open access systems that provide transportation for freight, bulk commodities and passengers, for which it is paid an access fee. This operating platform is comprised of businesses with regulated tariff structures, such as its railroad and toll road operations, as well as unregulated businesses, such as its ports. Its transport platform is expected to benefit from increases in demand for commodities as well as increases in the global movement of goods. Furthermore, the diversification within its transport platform mitigates the impact of fluctuations in demand from any particular sector, commodity or customer. The Company’s transport platform includes railroad operations, toll roads operations and port operations. Railroad Operations includes 5,100 kilometers of track in the southwest region of Western Australia. Toll Roads Operations includes 3,200 kilometers of toll roads in Brazil and Chile. Port Operations includes 28 port terminals primarily in the United Kingdom and across Europe.
The Company’s railroad operations consists of a below rail access provider, which operates approximately 5,100 kilometers of track and related infrastructure in the southwest region of Western Australia (WA) under a long-term lease with the government. Its railroad has approximately 36 years remaining on the lease and is a crucial transport link in the region. Its Australian railroad's revenue is derived from access charges paid by rail operators or underlying customers. Stability of revenue is underpinned by rail transport being a small yet essential component of the overall value of the commodities and freight transported and the long-term contractual framework that exists with a proportion of its customers.
The Company’s toll road operations consists of two urban toll roads and nine interurban toll roads in Chile and Brazil, respectively. Its Chilean operations include 33 kilometers of free flowing toll roads that form a key part of the ring road in the transportation network of Santiago, Chile. Its Brazilian operations comprise in excess of 3,200 kilometers of inter-urban toll roads, located in the Southeast and South regions of Brazil crossing or connecting states like Sao Paulo, Rio de Janeiro, Minas Gerais, Parana and Santa Catarina.
The Company’s port operations are located primarily in the United Kingdom and Europe. Its United Kingdom port is the operators in the country by volume and is a statutory harbor authority (SHA) for the Port of Tees and Hartlepool in the north of the United Kingdom. Its United Kingdom port's status as the SHA gives it the right to charge vessel and cargo owners conservancy tariffs (toll-like dues) for use of the River Tees. Its European port operations are comprised of a portfolio of concessions in key strategic locations throughout Europe that handle heavy dry bulk, specialty dry bulk, liquid bulk, general cargo and containers.
The Company’s energy platform consists of systems that provide energy transportation, distribution and storage services. This operating platform is comprised of businesses that are subject to light regulation, such as its natural gas transmission business whose services are subject to price ceilings, and businesses that are essentially unregulated like its district energy business. The Company’s energy platform is comprised of Energy Transmission, Distribution and Storage Operations and District Energy Operations. District Energy Operations consists of heating plants capable of delivering 1,905,000 pounds per hour of steam, as well as 136,800 tons of cooling capacity, sourced from a deep lake water system.
The Company’s energy transmission, distribution and storage operations natural gas transmission and pipeline systems in the United States, unregulated natural gas and liquid propane gas (LPG) distribution operations in Australia and the United States, and natural gas storage capacity in Alberta and the continental United States. Its profitability in this segment is primarily determined by its ability to compete in the market rather than from a regulated return on rate base. Its district energy operations consist of heating plants capable of delivering 1,905,000 pounds per hour of steam heating capacity, produced from three gas-fired steam plants and 136,800 tons of cooling capacity, sourced primarily from a deep lake water system. Its district energy operations provide steam heating in downtown Toronto, Ontario and in the medical district of New Orleans, Louisiana. District cooling services are provided through a deep lake cooling system in Toronto and from mechanical chilling operations in Houston, Texas and New Orleans.
Brookfield Infrastructure Partners LP
73 Front Street
HAMILTON HM 12