N-Q 1 tygnq83107.htm TORTOISE ENERGY INFRASTRUCTURE CORP. FORM N-Q tygnq83107.htm

 


 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


 
FORM N-Q
 
 
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY
 




Investment Company Act file number 811-21462



Tortoise Energy Infrastructure Corporation
(Exact name of registrant as specified in charter)



10801 Mastin Blvd., Suite 222, Overland Park, KS 66210
(Address of principal executive offices) (Zip code)



David J. Schulte
10801 Mastin Blvd., Suite 222, Overland Park, KS 66210
(Name and address of agent for service)



913-981-1020
Registrant's telephone number, including area code



Date of fiscal year end: November 30


Date of reporting period:  August 31, 2007




Item 1. Schedule of Investments.
(Unaudited) 
   
August 31, 2007 
 
Common Stock - 0.5% (1)
 
Shares
   
Value
 
Shipping - 0.5% (1)
           
Republic of the Marshall Islands - 0.5% (1)
           
Capital Product Partners L.P. (Cost $2,573,550)
   
119,700
    $
3,467,709
 
                 
Master Limited Partnerships and Related Companies - 200.6% (1)
         
Crude/Refined Products Pipelines - 101.7% (1)
               
United States - 101.7% (1)
               
Buckeye Partners, L.P.
   
567,102
     
27,816,353
 
Enbridge Energy Partners, L.P.
   
925,300
     
47,181,047
 
Enbridge Energy Partners, L.P. (2) (3)
   
971,399
     
48,045,373
 
Global Partners LP
   
214,286
     
6,844,295
 
Holly Energy Partners, L.P. (4)
   
427,070
     
19,440,226
 
Kinder Morgan Management, LLC (3)
   
1,669,229
     
80,356,684
 
Magellan Midstream Holdings, L.P.
   
589,245
     
16,681,526
 
Magellan Midstream Partners, L.P.
   
2,210,613
     
95,056,359
 
NuStar Energy L.P.
   
928,289
     
57,767,425
 
NuStar GP Holdings, LLC
   
1,062,718
     
34,750,879
 
Plains All American Pipeline, L.P.
   
1,986,084
     
114,299,134
 
Plains All American Pipeline, L.P. (2)
   
117,529
     
6,560,469
 
SemGroup Energy Partners, L.P.
   
151,675
     
4,556,317
 
Spectra Energy Partners, LP
   
332,965
     
8,820,243
 
Sunoco Logistics Partners L.P.
   
934,625
     
50,151,978
 
TEPPCO Partners, L.P.
   
869,520
     
34,911,228
 
TransMontaigne Partners L.P.
   
207,800
     
6,755,578
 
             
659,995,114
 
                 
Natural Gas/Natural Gas Liquids Pipelines - 48.0% (1)
               
United States - 48.0% (1)
               
Boardwalk Pipeline Partners, LP
   
1,162,800
     
38,604,960
 
Energy Transfer Equity, L.P.(2)
   
729,661
     
25,742,440
 
Energy Transfer Partners, L.P.
   
1,722,250
     
89,625,890
 
Enterprise GP Holdings L.P.
   
71,400
     
2,735,334
 
Enterprise Products Partners L.P.
   
3,005,940
     
88,705,289
 
ONEOK Partners, L.P.
   
267,455
     
17,114,445
 
TC PipeLines, LP
   
1,307,759
     
48,596,324
 
             
311,124,682
 
                 
Natural Gas Gathering/Processing - 36.6% (1)
               
United States - 36.6% (1)
               
Copano Energy, L.L.C.
   
1,073,386
     
41,851,320
 
Crosstex Energy, L.P.
   
268,587
     
9,507,980
 
Crosstex Energy, L.P. (2) (5)
   
712,760
     
22,986,510
 
Crosstex Energy, L.P. (2) (5)
   
193,767
     
5,377,034
 
DCP Midstream Partners, LP
   
19,200
     
868,800
 
DCP Midstream Partners, LP (2)
   
404,625
     
17,985,581
 
Duncan Energy Partners L.P.
   
441,900
     
10,596,762
 
Exterran Partners, L.P.
   
84,700
     
2,908,598
 
Exterran Partners, L.P. (2)
   
258,993
     
8,647,776
 
Hiland Partners, LP
   
41,048
     
2,052,811
 
MarkWest Energy Partners, L.P. (4)
   
2,201,640
     
70,188,283
 
Regency Energy Partners LP
   
162,100
     
5,187,200
 
Targa Resources Partners LP
   
115,200
     
3,456,000
 
Williams Partners L.P.
   
810,707
     
36,149,425
 
             
237,764,080
 
                 
Shipping - 4.3% (1)
               
Republic of the Marshall Islands - 0.9% (1)
               
Teekay LNG Partners L.P.
   
156,200
     
5,462,314
 
United States - 3.4% (1)
               
K-Sea Transportation Partners L.P. (4)
   
571,300
     
22,240,709
 
             
27,703,023
 
                 
Propane Distribution - 10.0% (1)
               
United States - 10.0% (1)
               
Inergy, L.P.
   
1,916,784
     
62,429,655
 
Inergy Holdings, L.P.
   
49,715
     
2,236,181
 
             
64,665,836
 
Total Master Limited Partnerships and Related Companies (Cost $852,797,397)
     
1,301,252,735
 
                 
Short-Term Investment - 2.8% (1)
               
United States Investment Company - 2.8% (1)
               
First American Government Obligations Fund - Class Y, 5.03% (6)
         
   (Cost $18,139,314)
   
18,139,314
     
18,139,314
 
                 
Total Investments - 203.9% (1) (Cost $873,510,261)
           
1,322,859,758
 
                 
Auction Rate Senior Notes - (47.0%) (1)
            (305,000,000 )
                 
Interest Rate Swap Contracts - 0.2% (1)
               
                 
$355,000,000 notional - Unrealized Appreciation, Net
           
1,263,948
 
                 
Liabilities in Excess of Cash and Other Assets - (28.6%) (1)
      (185,572,831 )
                 
Preferred Shares at Redemption Value - (28.5%) (1)
            (185,000,000 )
                 
Total Net Assets Applicable to Common Stockholders - 100.0% (1)
    $
648,550,875
 
                 
                 
(1) Calculated as a percentage of net assets applicable to common stockholders.
 
(2) Fair valued securities represent a total market value of $135,345,183 which represents 20.9% of net assets. These
 
   securities are deemed to be restricted.
 
(3) Security distributions are paid-in-kind.
               
(4) Affiliated investment; the Company owns 5% or more of the outstanding voting securities of the issuer.
 
(5) Non-income producing.
               
(6) Rate indicated is the 7-day effective yield as of August 31, 2007.
         

Certain of the Company’s investments are restricted and are valued as determined in accordance with procedures established by the Board of Directors.  The table below shows the number of units held, acquisition date, acquisition cost, value per unit of such securities and percent of net assets which the securities comprise at August 31, 2007.
 
Investment Security
Number of Units
Acquisition Date
Acquisition
Cost
Value
Per Unit
Value as Percent of
Net Assets
Crosstex Energy, L.P.
Series C Subordinated Units
712,760
6/29/06
$ 20,000,046
$32.25
 3.6%
Crosstex Energy, L.P.
Series D Subordinated Units
193,767
3/23/07
5,000,002
27.75
 0.8
DCP Midstream Partners, LP
Common Units
404,625
6/22/07
17,500,031
44.45
2.8
Enbridge Energy Partners, L.P.
Class C Common Units
971,399
4/02/07
50,000,000
49.46
7.4
Energy Transfer Equity, L.P.
Common Units
729,661
11/27/06
20,000,008
35.28
4.0
Exterran Partners, L.P.
Common Units
258,993
7/09/07
9,000,007
33.39
1.3
Plains All American Pipeline, L.P.
Common Units
117,529
6/25/07
7,000,000
55.82
1.0
       
$128,500,094
 
20.9%

The carrying value per unit of unrestricted common units of Crosstex Energy, L.P. (into which the restricted subordinated units are convertible) was $34.65 on March 23, 2007, the date of the purchase agreement and date an enforceable right to acquire the restricted Crosstex Energy, L.P. units was obtained by the Company.  The carrying value per unit of unrestricted common units of DCP Midstream Partners, LP was $45.48 on June 22, 2007, the date of the purchase agreement and date an enforceable right to acquire the restricted DCP Midstream Partners, L.P. units was obtained by the Company.  The carrying value per unit of unrestricted common units of Enbridge Energy Partners, L.P. (into which the restricted Class C common units are convertible) was $56.39 on April 2, 2007, the date of the purchase agreement and date an enforceable right to acquire the restricted Enbridge Energy Partners, L.P. units was obtained by the Company.  The carrying value per unit of unrestricted common units of Exterran Partners, L.P. was $39.44 on July 9, 2007, the date of the purchase agreement and date an enforceable right to acquire the restricted Exterran Partners, L.P. units was obtained by the Company.  The carrying value per unit of unrestricted common units of Plains All American Pipeline, L.P. was $63.76 on June 25, 2007, the date of the purchase agreement and date an enforceable right to acquire the restricted Plains All American Pipeline, L.P. units was obtained by the Company.
 
Investments representing 5 percent or more of the outstanding voting securities of a portfolio company result in that company being considered an affiliated company, as defined in the Investment Company Act of 1940. The aggregate market value of all securities of affiliates held by the Company as of August 31, 2007 amounted to $111,869,218, representing 17.2 percent of net assets applicable to common stockholders.  A summary of affiliated transactions for each company which is or was an affiliate at August 31, 2007 or during the period from December 1, 2006 to August 31, 2007, is as follows:

 
Share Balance 11/30/06
Gross Additions
Gross Reductions
Realized Gain (Loss)
Gross Distributions Received
August 31, 2007
 
Share Balance
Value
Holly Energy Partners, L.P.
427,070
$               -
$                -
$           -
$   884,035
427,070
$  19,440,226
K-Sea Transportation Partners L.P.
571,300
-
-
-
1,165,452
571,300
22,240,709
MarkWest Energy Partners, L.P. (1)(2)
1,016,877
1,384,765
-
-
3,268,027
2,201,640
70,188,283
   
$1,384,765
$                -
$           -
$5,317,514
 
$111,869,218

(1)  
2:1 stock split on March 1, 2007.
(2)  
121,186 unregistered shares registered for re-sale in a registration statement declared effective on July 11, 2007.

As of August 31, 2007, the aggregate cost of securities for federal income tax purposes was $812,365,415.  At August 31, 2007, the aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost was $513,120,492, the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value was $2,626,149 and the net unrealized appreciation was $510,494,343.

Item 2. Controls and Procedures.
 
(a)  
The registrant’s President and Chief Executive Officer and its Chief Financial Officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended.

(b)  
There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
 
Item 3. Exhibits.
 
Separate certifications for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) are filed herewith.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


  TORTOISE ENERGY INFRASTRUCTURE CORPORATION  
       
Date:  October 29, 2007
By:
/s/ David J. Schulte  
    David J. Schulte  
    President and Chief Executive Officer  
       



Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 
  TORTOISE ENERGY INFRASTRUCTURE CORPORATION  
       
Date:  October 29, 2007
By:
/s/ David J. Schulte  
    David J. Schulte  
    President and Chief Executive Officer  
       
       
Date:  October 29, 2007
By:
/s/ Terry Matlack  
    Terry Matlack  
    Chief Financial Officer