General

Organization

Kinder Morgan Energy Partners, L.P. is a Delaware limited partnership formed in August 1992. Unless the context requires otherwise, references to “we,” “us,” “our,” “KMP,” or the “Partnership” are intended to mean Kinder Morgan Energy Partners, L.P., our operating limited partnerships and their majority-owned and controlled subsidiaries. We are a leading pipeline transportation and energy storage company in North America, managing a diversified portfolio of energy transportation and storage assets. We own an interest in or operate approximately 52,000 miles of pipelines and 180 terminals, and we conduct our business through five reportable business segments.

These segments and the activities performed to provide services to our customers and create value for our unitholders are as follows:


▪	Natural Gas Pipelines - transporting, storing, buying, selling, gathering, treating, processing and fractionating natural gas;


▪	CO₂ – transporting oil, producing, transporting and selling CO₂for use in, and selling crude oil, natural gas and NGL produced from, enhanced oil recovery operations;


▪	Products Pipelines - transporting, storing and processing refined petroleum products (including gasoline, diesel fuel and jet fuel), NGL, crude oil, condensate and bio-fuels, plus operating associated product terminals and petroleum pipeline transmix facilities;


▪	Terminals - transloading, storing and delivering a wide variety of bulk, petroleum (including crude oil), petrochemical and other liquid products at terminal facilities located across the U.S. and portions of Canada; and


▪	Kinder Morgan Canada – transporting crude oil and refined petroleum products from Edmonton, Alberta, Canada to marketing terminals and refineries in British Columbia and the state of Washington.

We focus on providing fee-based services to customers, generally avoiding near-term commodity price risks and taking advantage of the tax benefits of a limited partnership structure. We trade on the NYSE under the symbol “KMP,” and we conduct our operations through five limited partnerships and one limited liability corporation, as follows: (i) Kinder Morgan Operating L.P. “A”; (ii) Kinder Morgan Operating L.P. “B”; (iii) Kinder Morgan Operating L.P. “C”; (iv) Kinder Morgan Operating L.P. “D”; (v) Kinder Morgan CO₂ Company, L.P.; and (vi) Copano. Combined, the five limited partnerships are referred to as our operating partnerships, and we are the 98.9899% limited partner and our general partner is the 1.0101% general partner in each. Both we and our operating partnerships are governed by Amended and Restated Agreements of Limited Partnership, as amended, and certain other agreements that are collectively referred to in this report as the partnership agreements.

KMI and Kinder Morgan G.P., Inc.

KMI, a Delaware corporation, indirectly owns all the common stock of our general partner, Kinder Morgan G.P., Inc., a Delaware corporation; however, in July 2007, our general partner issued and sold to a third party 100,000 shares of Series A fixed-to-floating rate term cumulative preferred stock due 2057. The consent of holders of a majority of these preferred shares is required with respect to a commencement of or a filing of a voluntary bankruptcy proceeding with respect to us or two of our subsidiaries, SFPP and Calnev. KMI’s common stock trades on the NYSE under the symbol “KMI.”

As of December 31, 2013, KMI and its consolidated subsidiaries owned, through KMI’s general and limited partner interests in us and its ownership of shares issued by its subsidiary KMR (discussed following), an approximate 11.6% interest in us. In addition to the distributions it receives from its limited and general partner interests, KMI also receives an incentive distribution from us as a result of its ownership of our general partner. Including both its general and limited partner interests in us, at the 2013 distribution level, KMI received approximately 49% of all quarterly distributions of available cash from us, with approximately 43% and 6% of all quarterly distributions from us attributable to KMI’s general partner and limited partner interests, respectively. As of December 31, 2012, KMI owned an approximate 12.8% interest in us and, at the 2012 distribution level, KMI received approximately 51% of all quarterly distributions of available cash from us, with approximately 45% and 6% of all quarterly distributions from us attributable to KMI’s general partner and limited partner interests, respectively. In addition, as a result of its May 25, 2012 acquisition of all of the outstanding shares of EP, a Delaware corporation, KMI now owns a 41% limited partner interest and the 2% general partner interest in EPB.

KMR

KMR is a Delaware LLC formed in February 2001. Our general partner owns all of KMR’s voting securities and, pursuant to a delegation of control agreement, has delegated to KMR, to the fullest extent permitted under Delaware law and our partnership agreement, all of its power and authority to manage and control our business and affairs, except that KMR cannot take certain specified actions without the approval of our general partner. KMR’s shares represent LLC interests and trade on the NYSE under the symbol “KMR.”

Under the delegation of control agreement, KMR, as the delegate of our general partner, manages and controls our business and affairs and the business and affairs our operating limited partnerships, of Copano, and our operating limited partnerships and Copano’s majority-owned and controlled subsidiaries. Furthermore, in accordance with its LLC agreement, KMR’s activities are limited to being a limited partner in us, and managing and controlling the business and affairs of us, our operating limited partnerships, Copano, and our operating limited partnerships and Copano’s majority-owned and controlled subsidiaries. As of December 31, 2013 and 2012, KMR, through its sole ownership of our i-units, owned approximately 28.3% and 30.8%, respectively, of all of our outstanding limited partner units (which are in the form of i-units that are issued only to KMR).