USA: El Paso Ups Earnings Guidance

El Paso Corporation announced today that it is raising its financial and operational guidance for 2011 as results to date have exceeded expectations.

Updated 2011 Guidance

— $1.00-$1.10 adjusted diluted earnings per share (Adjusted EPS)

— $2.3-$2.5 billion Adjusted Segment Earnings Before Interest and Taxes (Adjusted Segment EBIT)

— $3.4-$3.6 billion Adjusted Segment Earnings Before Interest, Taxes and Depreciation, Depletion and Amortization (Adjusted Segment EBITDA)

— $2.2-$2.4 billion cash flow from operations — $3.6 billion capital program

— $1.6 billion — Exploration and Production (E&P)

— $1.8 billion — Pipeline Group (includes 100 percent of the Ruby Pipeline Project)

— $0.2 billion — Midstream and Other

— Total production increasing to 830-860 million cubic feet equivalent per day

— Oil volumes rising to 18,500-20,500 barrels per day, 35-45 percent above 2010 levels

Note: Adjusted EPS, Adjusted Segment EBIT and Adjusted Segment EBITDA exclude loss on debt extinguishment and mark-to-market impacts from financial derivatives and include cash settlement proceeds of E&P financial derivatives based on guidance assumption prices. Guidance is based on $4.50 per MMBtu for natural gas (NYMEX) and $107 per barrel for oil (WTI).

“El Paso is on its way to another great year with improved earnings and operating cash flow,” said Doug Foshee, chairman, president, and chief executive officer of El Paso Corporation. “We are particularly excited about our drilling results in the Eagle Ford shale, where our oil production will grow significantly this year. We are also very pleased with the pace of drop downs to El Paso Pipeline Partners, L.P. . Our MLP has already issued more equity than we anticipated for all of 2011, and we will continue to accelerate our balance sheet improvement with the proceeds from future transactions.”

The company is raising its E&P capital by approximately $300 million to $1.6 billion to increase its activity in its Eagle Ford Central oil shale program in La Salle, County, TX. So far this year, El Paso’s E&P business has successfully mitigated much of the oil service cost inflation through increased efficiencies. Pipeline capital has been increased by approximately $100 million, primarily due to higher costs to complete the Ruby Pipeline.

[mappress]

Source: El Paso, May 24, 2011;