What is the primary purpose of the Credit Agreement disclosed in this 8-K?

The primary purpose of the Credit Agreement is to provide financing for the development, construction, and completion of Kinder Morgan's Trans Mountain expansion project through its Canadian subsidiaries.

What is KMI's financial commitment or support for this project's financing?

KMI has entered into an Equity Nomination and Support Agreement, committing to contribute or cause the contribution of equity to Cochin at the time of each credit facility drawdown. This is to ensure that the outstanding indebtedness for the project does not exceed 60% of the projected total project costs over the subsequent six months.

What are the key terms of the credit facilities, such as size, maturity, and interest rates?

The agreement establishes a CAD $4.0 billion revolving construction credit facility, a CAD $1.0 billion revolving contingent credit facility, and a CAD $500 million revolving working capital facility. All facilities mature on June 16, 2022. Interest rates vary based on the loan type, referencing Canadian Prime, U.S. Base Rate, or LIBOR, plus applicable margins that depend on credit ratings.

Are there any security or guarantee arrangements associated with these credit facilities?

Yes, the Borrowers' obligations are guaranteed by KML and other KMI subsidiaries. The facilities are secured by first priority security interests in the assets of the Borrowers and guarantors, and by a pledge of partnership interests in Kinder Morgan Canada Limited Partnership.

KMI/EP-PC 8-K: Material Agreements & Financial Events

Summary

Kinder Morgan, Inc. (KMI) has filed an 8-K report detailing significant financing arrangements for its Canadian subsidiary's Trans Mountain expansion project. On June 16, 2017, two KMI subsidiaries, Kinder Morgan Cochin ULC and Trans Mountain Pipeline ULC, entered into a definitive Credit Agreement establishing a substantial CAD $4.0 billion revolving construction credit facility. This facility, along with a CAD $1.0 billion contingent credit facility and a CAD $500 million working capital facility, is designed to fund the development, construction, and operational needs of the Trans Mountain expansion project. KMI, holding a roughly 70% economic interest in these subsidiaries, has committed to support these credit facilities through an Equity Nomination and Support Agreement, ensuring the project's debt levels remain within a specified ratio of total project costs.

Key Highlights

1Kinder Morgan Canada Limited (KML) subsidiaries secured a CAD $4.0 billion revolving construction credit facility on June 16, 2017, to fund the Trans Mountain expansion project.
2The financing package also includes a CAD $1.0 billion contingent credit facility and a CAD $500 million working capital facility for general corporate purposes.
3KMI holds an approximate 70% economic interest in the Borrowers and has agreed to provide equity support to maintain project debt-to-cost ratios.
4The credit facilities mature on June 16, 2022, with interest rates tied to Canadian Prime, U.S. Base Rate, or LIBOR, plus applicable margins.
5Obligations under the Credit Agreement are guaranteed by KML and other KMI subsidiaries and secured by first priority security interests in the Borrowers' assets.
6The agreement includes standard financial covenants, such as a maximum debt-to-capitalization ratio of 70%, and customary events of default.

KINDER MORGAN, INC. 8-K Report, Material Agreement (Jun 22, 2017)

Summary

Key Highlights

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