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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
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[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
EL PASO CORPORATION
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(Name of Registrant as Specified in its Charter)
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EL PASO CORPORATION
Operating Statistics
First Quarter 2003
Table of Contents
Page
Consolidated Statements of Income 2
Consolidated Analysis of Non-Recurring Items 3
Segment Information 4
Consolidated Operating Results
Consolidated Net Income 5
Consolidated Earnings Before Interest Expense and Income Taxes 6
Business Segment Results
Pipeline Group
Earnings Before Interest Expense and Income Taxes 7
Throughput 8
Production
Earnings Before Interest Expense and Income Taxes 9
Sales Volumes and Realized Prices 10
Merchant Energy Group
Earnings Before Interest Expense and Income Taxes 11
Analysis of Pro Forma Earnings Before Interest Expense
and Income Taxes by Division 12
Operating Data 13
Field Services
Earnings Before Interest Exposure and Income Taxes 13
Volumes and Rates 15
Schedule of Non-Recurring Items 16
EL PASO CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In Millions, Except per Share Amounts)
(UNAUDITED)
First Quarters Ended
March 31,
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2003 2002
------------------------------
Operating revenues $ 4,018 $ 3,765
Operating expenses
Cost of products and services 2,508 1,623
Operation and maintenance 612 662
Restructuring costs 75 -
(Gain) loss on long-lived assets 318 (15)
Ceiling test charges - 33
Depreciation, depletion and amortization 361 365
Taxes, other than income taxes 83 85
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3,957 2,753
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Operating income 61 1,012
Equity earnings and other income (expense) (185) (299)
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Earnings (losses) before interest expense, income taxes and other charges (124) 713
Interest and debt expense 345 307
Return on preferred interests of consolidated subsidiaries 39 40
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Income (loss) before income taxes (508) 366
Income taxes (133) 118
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Income (loss) from continuing operations before cumulative
effect of accounting changes (375) 248
Discontinued operations, net of income taxes 3 (19)
Cumulative effect of accounting changes, net of income taxes (22) 154
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Net income (loss) $ (394) $ 383
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Diluted earnings (losses) per common share $ (0.66) $ 0.72
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Diluted average common shares outstanding (000's) 595,059 538,015
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EL PASO CORPORATION
CONSOLIDATED ANALYSIS OF NON-RECURRING ITEMS
(In Millions, Except per Share Amounts)
(UNAUDITED)
First Quarters Ended
March 31,
--------------------------------
2003 2002
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Reported net income (loss) $ (394) $ 383
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Non-recurring items affecting EBIT
Restructuring costs 75 -
Impairment of long-lived assets 368 -
Impairment of equity investments 207 286
Impairments of cost basis investments 86 56
Net gain on sale of long-lived assets (49) -
Net loss on sale of equity investments 11 -
Ceiling test charges - 33
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Total non-recurring items affecting EBIT 698 375
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Income tax- tax effect of above non-recurring items (183) (121)
Discontinued coal operations, net of income taxes (3) 19
Cumulative effect of accounting changes, net of income taxes:
Adoption of SFAS No. 143- retirement obligations 22 -
Adoption of SFAS No. 141- elimination of negative goodwill - (154)
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Pro forma net income $ 140 $ 502
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Diluted earnings (losses) per common share:
Pro forma diluted earnings per common share $ 0.24 $ 0.93
Restructuring costs (0.09) -
Impairment of long-lived assets (0.46) -
Impairment of equity investments (0.26) (0.35)
Impairments of cost basis investments (0.11) (0.07)
Net gain on sale of long-lived assets 0.06 -
Net loss on sale of equity investments (0.01) -
Ceiling test charges - (0.04)
Discontinued coal operations 0.01 (0.03)
Cumulative effect of accounting changes:
Adoption of SFAS No. 143- retirement obligations (0.04) -
Adoption of SFAS No. 141- elimination of negative goodwill - 0.28
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Reported diluted earnings (losses) per common share $ (0.66) $ 0.72
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Adjusted pro forma diluted average common shares outstanding (000's) 595,059 546,472
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Reported diluted average common shares outstanding (000's) 595,059 538,015
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EL PASO CORPORATION
SEGMENT INFORMATION
(UNAUDITED)
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2003 2002
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(In Millions) First First Second Third Fourth
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Operating revenues
Pipelines $ 754 $ 703 $ 629 $ 609 $ 664
Production 595 550 560 499 517
Merchant Energy 2,164 2,021 1,356 1,078 1,135
Field Services 558 540 501 551 437
All other and eliminations (53) (49) (49) (74) 16
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Consolidated total $ 4,018 $ 3,765 $ 2,997 $ 2,663 $ 2,769
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Depreciation, depletion and amortization
Pipelines $ 95 $ 91 $ 95 $ 94 $ 94
Production 205 207 193 181 192
Merchant Energy 29 34 31 34 30
Field Services 10 19 15 11 11
All other and eliminations 22 14 18 20 21
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Consolidated total $ 361 $ 365 $ 352 $ 340 $ 348
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Operating income (loss)
Pipelines $ 384 $ 357 $ 277 $ 259 $ (103)
Production 235 175 5 179 170
Merchant Energy (514) 455 (25) (241) (1,525)
Field Services - 38 36 20 177
All other and eliminations (44) (13) (59) (16) (238)
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Operating income (loss) as reported $ 61 $ 1,012 $ 234 $ 201 $(1,519)
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Earnings (losses) before interest expense and income
taxes as reported
Pipelines $ 429 $ 399 $ 323 $ 302 $ (206)
Production 244 176 7 179 172
Merchant Energy (756) 93 60 (171) (1,620)
Field Services 27 51 54 (11) 193
All other and eliminations (68) (6) (78) 34 (271)
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Consolidated total (124) 713 366 333 (1,732)
Non-recurring charges 698 375 332 33 1,542
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Pro forma earnings (losses) before interest
and taxes $ 574 $ 1,088 $ 698 $ 366 $ (190)
EL PASO CORPORATION
CONSOLIDATED NET INCOME
(UNAUDITED)
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2003 2002
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(In Millions, Except per Share Amounts) First First Second Third Fourth
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Operating revenues $ 4,018 $ 3,765 $ 2,997 $ 2,663 $ 2,769
Operating expenses 3,957 2,753 2,763 2,462 4,288
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Operating income (loss) 61 1,012 234 201 (1,519)
Equity earnings and other income (expense) (185) (299) 132 132 (213)
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Earnings (losses) before interest expense, income
taxes and other charges (124) 713 366 333 (1,732)
Interest and debt expense 345 307 314 342 342
Return on preferred interests of consolidated
subsidiaries 39 40 43 38 38
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Income (loss) before income taxes (508) 366 9 (47) (2,112)
Income taxes (133) 118 1 (14) (600)
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Income (loss) from continuing operations before
cumulative effect of accounting changes (375) 248 8 (33) (1,512)
Discontinued operations, net of income taxes 3 (19) (67) (36) (2)
Cumulative effect of accounting changes, net of
income taxes (22) 154 14 - (222)
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Consolidated net income (loss) $ (394) $ 383 $ (45) $ (69) $ (1,736)
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Pro forma diluted earnings (losses) per common share (a) $ 0.24 $ 0.93 $ 0.44 $ (0.02) $ (0.69)
Reported diluted earnings (losses) per common share $ (0.66) $ 0.72 $ (0.08) $ (0.12) $ (2.92)
Adjusted pro forma diluted average common shares
outstanding (000's) 595,059 546,472 539,975 586,079 593,894
Reported diluted average common shares outstanding (000's) 595,059 538,015 532,163 586,079 593,894
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(a) Second quarter 2002 pro forma net income and pro forma diluted earnings
per share exclude an after-tax ceiling test charge of $(159) million,
after-tax restructuring costs of ($43) million, after-tax gain on sale of
Field Services' Dragon Trail processing plant of $7 million, discontinued
operations of $(67) million, net of income taxes, cumulative effect of an
accounting change of $14 million from the adoption of Derivatives Issue
C-16 of $14 million, net of income taxes, and after-tax currency loss on
Euro bond offering of $(31) million.
Third quarter 2002 pro forma net income and pro forma diluted earnings per
share exclude discontinued operations of $(36) million, net of income
taxes, and after-tax loss on sale of asset disposals of $(22) million.
Fourth quarter 2002 pro forma net income and pro forma diluted earnings per
share exclude an after-tax Western Energy Settlement of $(644) million,
after-tax ceiling test charge of $(1) million, after-tax restructuring
costs of $(13) million, discontinued operations of $(2) million, net of
income taxes, cumulative effect of accounting charges for adoption of EITF
Issue No. 02-3 of $(222) million, net of income taxes, after-tax long-lived
asset impairment of $(393) million, after-tax equity investment impairment
of $(209) million, after-tax net loss on sales of equity investment of
$(14) million, and after-tax net gain on sales of long-lived assets of $169
million.
For an explanation of the first quarter 2003 and 2002 excluded charges,
refer to the Consolidated Analysis of Non-Recurring Items on page 3.
EL PASO CORPORATION
CONSOLIDATED EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
(UNAUDITED)
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2003 2002
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(In Millions) First First Second Third Fourth
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Operating revenues
Pipelines $ 754 $ 703 $ 629 $ 609 $ 664
Production 595 550 560 499 517
Merchant Energy 2,164 2,021 1,356 1,078 1,135
Field Services 558 540 501 551 437
All other and eliminations (53) (49) (49) (74) 16
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Total 4,018 3,765 2,997 2,663 2,769
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Operating expenses
Cost of products and services 2,508 1,623 1,482 1,425 1,917
Operation and maintenance 612 662 584 632 728
Restructuring costs 75 - 63 - 18
(Gain) loss on long-lived assets 318 (15) (15) 1 311
Western Energy Settlement - - - - 899
Ceiling test charges - 33 234 - 2
Depreciation, depletion and amortization 361 365 352 340 348
Taxes, other than income taxes 83 85 63 64 65
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Total 3,957 2,753 2,763 2,462 4,288
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Consolidated operating income (loss) 61 1,012 234 201 (1,519)
Equity earnings and other income (expense) (185) (299) 132 132 (213)
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Earnings (losses) before interest expense, income
taxes and other charges $ (124) $ 713 $ 366 $ 333 $(1,732)
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PIPELINE GROUP
EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
(Excludes Intrasegment Transactions)
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2003 2002
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(In Millions) First First Second Third Fourth
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Revenues $ 754 $ 703 $ 629 $ 609 $ 664
Operating expenses
Operation and maintenance 238 227 223 226 240
Restructuring costs - - 1 - -
(Gain) loss on long-lived assets - (12) (2) 2 (1)
Western Energy Settlement - - - - 412
Depreciation, depletion and amortization 95 91 95 94 94
Taxes, other than income taxes 37 40 35 28 22
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Total 370 346 352 350 767
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Operating income (loss) as reported 384 357 277 259 (103)
Equity earnings and other income (expense) 45 42 46 43 (103)
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Earnings (losses) before interest expense and
income taxes as reported $ 429 $ 399 $ 323 $ 302 $ (206)
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Earnings (losses) before interest expense and
income taxes as reported $ 429 $ 399 $ 323 $ 302 $ (206)
Non-recurring charges:
Operation and Maintenance - - 1 - -
Western Energy Settlement - - - - 412
Equity earnings and other income - - - - 149
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Pro forma earnings before interest expense
and income taxes $ 429 $ 399 $ 324 $ 302 $ 355
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PIPELINE GROUP
THROUGHPUT
(Excludes Intrasegment Volumes)
(BBTU/D)
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2003 2002
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First First Second Third Fourth
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Tennessee Gas Pipeline 5,991 4,789 4,235 4,472 4,889
American Natural Resources 5,461 5,044 3,744 3,637 4,112
Southern Natural Gas 2,451 2,371 1,992 1,982 2,263
El Paso Natural Gas 4,069 4,203 4,046 4,069 3,943
Colorado Interstate Gas 2,933 2,851 2,576 2,613 3,032
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Total 20,905 19,258 16,593 16,773 18,239
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Equity Investments (Ownership Percentage)
Citrus (50%) 917 887 1,048 1,151 919
Portland (30%) 57 51 31 43 46
Australia (33%) 293 286 309 320 304
Great Lakes (50%) 1,437 1,245 1,099 1,221 1,192
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Total 2,704 2,469 2,487 2,735 2,461
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Total throughput 23,609 21,727 19,080 19,508 20,700
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PRODUCTION
EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
(Excludes Intrasegment Transactions)
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2003 2002
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(In Millions) First First Second Third Fourth
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Operating revenues
Natural gas $ 490 $ 480 $ 441 $ 403 $ 434
Oil, condensate and liquids 106 82 115 92 84
Other (1) (12) 4 4 (1)
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Total operating revenues 595 550 560 499 517
Transportation and net product costs (31) (22) (33) (29) (29)
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Total operating margin 564 528 527 470 488
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Operating expenses
Operation and maintenance 87 97 92 97 100
Restructuring costs 3 - - - -
(Gain) loss on long-lived assets 9 (2) - - 5
Ceiling test charges - 33 234 - 2
Depreciation, depletion and amortization 205 207 193 181 192
Taxes, other than income taxes 25 18 3 13 19
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Total 329 353 522 291 318
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Operating income 235 175 5 179 170
Equity Earnings and Other income 9 1 2 - 2
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Earnings before interest expense and income
taxes as reported $ 244 $ 176 $ 7 $ 179 $ 172
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Earnings before interest expense and income
taxes as reported $ 244 $ 176 $ 7 $ 179 $ 172
Non-recurring charges:
Operation and Maintenance 12 - - - 4
Ceiling test charges - 33 234 - 2
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Pro forma earnings before interest expense
and income taxes $ 256 $ 209 $ 241 $ 179 $ 178
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PRODUCTION
SALES VOLUMES AND REALIZED PRICES
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2003 2002
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First First Second Third Fourth
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Natural Gas Sales Volumes (MMcf)
Onshore 51,279 82,122 69,866 68,612 62,619
Offshore 35,884 40,024 38,239 36,991 35,818
Coal Seam 10,713 7,261 8,223 9,957 10,350
International 3,867 3,859 3,692 4,532 4,759
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Total Natural Gas Sales Volumes 101,743 133,266 120,020 120,092 113,546
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Oil, Condensate and Liquids Sales Volumes (MBbls)
Onshore 1,524 2,132 1,778 1,416 1,261
Offshore 2,068 2,586 2,913 2,323 2,053
International 132 270 275 247 260
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Total Oil, Condensate and Liquids
Sales Volumes 3,724 4,988 4,966 3,986 3,574
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Equivalent Sales Volumes (MMcf)
Onshore 60,420 94,913 80,534 77,109 70,184
Offshore 48,291 55,538 55,719 50,931 48,134
Coal Seam 10,715 7,261 8,223 9,957 10,350
International 4,660 5,481 5,340 6,011 6,324
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Total Equivalent Sales Volumes 124,086 163,193 149,816 144,008 134,992
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Weighted Average Realized Prices
Natural gas ($/Mcf) $ 4.60 $ 3.46 $ 3.45 $ 3.21 $ 3.61
Natural gas ($/Mcf) before hedging $ 6.46 $ 2.18 $ 2.40 $ 2.93 $ 3.79
Oil, condensate and liquids ($/Bbl) $ 27.33 $ 15.68 $ 22.14 $ 22.19 $ 22.39
Oil, condensate and liquids ($/Bbl)
before hedging $ 28.12 $ 15.02 $ 21.99 $ 22.93 $ 23.14
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MERCHANT ENERGY GROUP
EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
(EXCLUDES INTRASEGMENT TRANSACTIONS)
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2003 2002
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(In Millions) First First Second Third Fourth
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Gross margin and other revenue $ 200 $ 819 $ 307 $ 101 $ (312)
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Operating expenses
Operation and maintenance 314 319 277 295 359
Restructuring costs 59 - 11 1 17
(Gain) loss on long-lived assets 300 - (3) (2) 306
Western Energy Settlement - - - - 487
Depreciation, depletion and amortization 29 34 31 34 30
Taxes, other than income taxes 12 11 16 14 14
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Total 714 364 332 342 1,213
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Operating income (loss) as reported (514) 455 (25) (241) (1,525)
Equity earnings and other income (expense) (242) (362) 85 70 (95)
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Earnings (losses) before interest expense
and income taxes as reported $ (756) $ 93 $ 60 $ (171) $ (1,620)
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Earnings (losses) before interest expense
and income taxes as reported $ (756) $ 93 $ 60 $ (171) $ (1,620)
Non-recurring charges:
Operation and maintenance 359 - 11 1 326
Western Energy Settlement - - - - 487
Equity earnings and other income (expense) 304 342 - (16) 159
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Pro forma earnings (losses) before interest
expense and income taxes $ (93) $ 435 $ 71 $ (186) $ (648)
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MERCHANT ENERGY GROUP
ANALYSIS OF PRO FORMA EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES BY DIVISION
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2003 2002
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(In Millions) First First Second Third Fourth
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Power
Electron management fee $ - $ 46 $ 46 $ 47 $ 46
Other Domestic 8 264 69 19 4
International 51 14 114 49 47
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Total 59 324 229 115 97
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Petroleum
Refineries 82 105 (16) (84) 10
Chemicals, Terminals, Marine, & Other (4) 1 - (1) (11)
Petroleum & LNG Trading (4) 4 19 17 42
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Total 74 110 3 (68) 41
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Trading
Gas and Power (151) 68 (108) (170) (713)
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Total (151) 68 (108) (170) (713)
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Power (13) (21) (16) (17) (17)
Petroleum (27) (23) (13) (16) (27)
Trading (35) (23) (24) (30) (29)
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General and Administrative (75) (67) (53) (63) (73)
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Total $ (93) $ 435 $ 71 $ (186) $ (648)
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MERCHANT ENERGY GROUP
OPERATING DATA
(Excludes Intrasegment Transactions)
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2003 2002
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First First Second Third Fourth
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PRICE RISK MANAGEMENT STATISTICS
Forward Trading Book (In Millions) $ (146) $ 995 $ 1,078 $ 968 $ (59)
Forward Non-trading Book (In Millions) 967 984 979 963 968
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Total Foward Book (In Millions) $ 821 $ 1,979 $ 2,057 $ 1,931 $ 909
Average VAR (In Millions)* $ 22 $ 18 $ 13 $ 16 $ 16
Physical Gas Delivery (BBtu/d) 5,536 13,221 13,639 12,425 8,232
Physical Power Sales (MMWh) 85,330 104,659 107,698 141,022 116,098
Financial Settlements (BBtue/d)** 121,330 222,745 201,637 207,683 195,215
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ASSET STATISTICS
Power Assets Capacity (Net Megawatts)
Domestic 1,825 2,228 2,228 2,183 2,192
Electron 3,452 3,931 3,931 3,465 3,457
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Total Domestic 5,277 6,159 6,159 5,648 5,649
International 4,773 4,389 4,535 5,302 4,836
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Total 10,050 10,548 10,694 10,950 10,485
Power Generation Volumes (MMWh) 1,096 1,663 1,409 1,631 1,206
Petroleum Assets
Aruba refinery-MBbl/d 169 220 124 118 124
Aruba refinery-Margin/Bbl $ 5.971 $ 3.324 $ 1.619 $ 1.659 $ 3.103
Eagle Point refinery-MBbl/d 144 92 124 143 146
Eagle Point refinery-Margin/Bbl $ 7.118 $ 4.351 $ 2.942 $ 3.261 $ 4.174
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ANALYSIS OF PRICE RISK MANAGEMENT ACTIVITIES
AND FORWARD BOOK
Total Portfolio Value at Risk:
(In Millions)
-------------
One Day VAR-95% Confidence Level at March 31, 2003 $ 15
One Day VAR-99% Confidence Level at March 31, 2003 $ 21
Average VAR-95% Confidence Level during 2003 $ 22
High VAR-95% Confidence Level during 2003 $ 35
Low VAR-95% Confidence Level during 2003 $ 15
March 31, 2003
------------------------------------------------------------
Forward Accrual Return of Total Cash
Trading Book Based Portfolio Cash Collateral Expectations
Risk Management Assets and Liabilities ------------------------------------------------------------
Mark to Market Value and Cash Liquidation (In Millions)
2003 $ (19) $ (40) $ 792 $ 733
2004 $ (53) $ (58) $ 247 $ 136
2005 $ 1 $ (36) $ 75 $ 40
2006 $ 6 $ (23) $ 20 $ 3
2007 $ (16) $ (8) $ 31 $ 7
Remainder $ (65) $ 48 $ 117 $ 100
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Total $ (146) $ (117) $ 1,282 $ 1,019
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* Average VAR was calculated using the historical simulation methodology.
** Financial settlements for the second through fourth quarters of 2002
exclude financial settlements associated with futures.
FIELD SERVICES
EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
(Excludes Intersegment Transactions)
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2003 2002
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(In Millions) First First Second Third Fourth
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Gross margin
Gathering and transportation $ 12 $ 82 $ 41 $ 39 $ 29
Processing 31 39 39 39 30
NGL business 4 4 4 2 1
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Total 47 125 84 80 60
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Operating expenses
Operation and maintenance 31 61 37 44 38
Restructuring costs - - 1 - -
(Gain) loss on long-lived assets 1 - (10) 1 (170)
Depreciation, depletion and amortization 10 19 15 11 11
Taxes, other than income taxes 5 7 5 4 4
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Total 47 87 48 60 (117)
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Operating income as reported - 38 36 20 177
Equity earnings and other income (expense) 27 13 18 (31) 16
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Earnings (losses) before interest expense
and income taxes as reported $ 27 $ 51 $ 54 $ (11) $ 193
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Earnings (losses) before interest expense
and income taxes as reported $ 27 $ 51 $ 54 $ (11) $ 193
Non-recurring charges:
Operation and maintenance 1 - (9) 1 (169)
Equity earnings and other income - - - 47 3
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Pro forma earnings before interest
expense and income taxes $ 28 $ 51 $ 45 $ 37 $ 27
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Equity earnings from El Paso Energy
Partners, L.P. (a) $ 29 $ 15 $ 18 $ 17 $ 19
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Cash Distributions from El Paso Energy
Partners, L.P.
Common unit ownership $ 8 $ 6 $ 8 $ 8 $ 8
Series C unit ownership 7 - - - -
General partner ownership 15 9 11 11 12
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Total $ 30 $ 15 $ 19 $ 19 $ 20
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(a) El Paso is a general partner and owns 24.6 percent of the common units,
all of the partnership's Series C units and Series B preference units. The
Series C units are reflected in the partnership's capital account at $347
million and the Series B preference units are reflected at $161 million at
March 31, 2003.
FIELD SERVICES SEGMENT
VOLUMES AND RATES
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2003 2002
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First First Second Third Fourth
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Gathering and transportation volumes (BBtu/d) 531 641 638 619 691
Gathering and transportation volumes
from sold assets (1) 46 5,191 1,627 1,590 1,148
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Total gathering and transportation
volumes (BBtu/d) 577 5,832 2,265 2,209 1,839
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Weighted average gathering and transportation
rates ($/MMBtu) $ 0.22 $ 0.16 $ 0.20 $ 0.19 $ 0.17
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Processing volumes (Inlet BBtu/d ) 3,302 3,302 3,260 3,263 3,282
Processing volumes from sold assets (2) 5 815 696 620 447
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Total processing volumes (Inlet BBtu/d) 3,307 4,117 3,956 3,883 3,729
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Weighted average processing margins ($/MMBtu) $ 0.11 $ 0.10 $ 0.11 $ 0.11 $ 0.09
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Total NGL production (Bbl/d) 97,117 162,052 181,718 153,630 134,851
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2003 2002
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First First Second Third Fourth
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El Paso Energy Partners, L.P.
Natural gas pipelines and plants (BBtu/d) 7,710 2,430 6,254 5,971 6,501
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Oil and NGL logistics (Bbls/d) 256,842 231,740 240,184 219,449 209,613
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(1) Year 2002 primarily includes volumes for assets sold during 2002 and
1st Qtr. 2003:
1st Qtr: Texas Intrastate, Waha, and Carlsbad Gathering Systems (sold
April 2002) 3,679 Mdth/d; San Juan Gathering System (sold November
2002)
1,221 Mdth/d; Natural Buttes/Ouray (sold December 2002) 137
Mdth/d: and Wyoming Assets (sold February 2003) 154 Mdth/d
2nd Qtr: San Juan Gathering System 1,199 Mdth/d; Natural Butes/Ouray
146 Mdth/d; and Wyoming Assets 153 Mdth/d
3rd Qtr: San Juan Gathering System 1,213 Mdth/d; Natural Buttes/Ouray
143 Mdth/d; and Wyoming Assets 145 Mdth/d
4th Qtr: San Juan Gathering System 864 Mdth/d: Natural Buttes/Ouray
156 Mdth/d; and Wyoming Assets 129 Mdth/d
Year 2003 includes volumes for assets sold during 1st Qtr. 2003; 1st
Qtr: Wyoming Assets 46 Mdth/d
(2) Year 2002 primarily includes volumes for assets sold during 2002 and
1st Qtr. 2003:
1st Qtr: Indian Basin (sold April 2002) 140 Mdth/d; Dragon Trail (sold
May 2002) 40 Mdth/d; Chaco (sold November 2002) 618 Mdth/d; and
Wyoming Assets (sold February 2003) 17 Mdth/d.
2nd Qtr: Dragon Trail 28 Mdth/d; Chaco 646 Mdth/d; and Wyoming Assets
22 Mdth/d.
3rd Qtr: Chaco 605 Mdth/d; and Wyoming Assets 15 Mdth/d.
4th Qtr: Chaco 432 Mdth/d; and Wyoming Assets 15 Mdth/d.
Year 2003 includes volumes for assets sold during 1st Qtr. 2003; 1st
Qtr: Wyoming Assets 5 Mdth/d
EL PASO CORPORATION
SCHEDULE OF NON-RECURRING ITEMS
(UNAUDITED)
------------------------------------------------------------------------------------------------------------------------------
First Quarter Ended March 31,
----------------------------------------------------------------------
2003 2002
----------------------------------------------------------------------
(In Millions) Pre-tax After-tax Pre-tax After-tax
------------------------------------------------------------------------------------------------------------------------------
Restructuring costs
Employee severance, retention and transition costs $ 31 $ 23 $ - $ -
LNG charter cancellation and restructuring costs 44 32 - -
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Total restructuring costs 75 55 - -
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Asset impairments and net (gain)/loss on sales
Long-lived assets impairment 368 271 - -
Equity investments impairment 207 153 286 193
Cost basis investments impairment 86 64 56 38
Long-lived assets net gain on sales (49) (36) - -
Equity investments net loss on sales 11 8 - -
--------------------------------------------------------------------------------------------------------------------------
Total loss on assets 623 460 342 231
--------------------------------------------------------------------------------------------------------------------------
Ceiling test charges - - 33 23
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Total charges impacting EBIT 698 515 375 254
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Discontinued operations, net of income taxes - (3) - 19
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Cumulative effect of accounting changes,
net of income taxes - 22 - (154)
--------------------------------------------------------------------------------------------------------------------------
Total non-recurring items $ 698 $ 534 $ 375 $ 119
--------------------------------------------------------------------------------------------------------------------------
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First Quarter 2003
----------------------------------------------------
Pro forma Non-Rec Reported
Total EBIT by segment EBIT Charges EBIT
----------------------------------------------------
Pipelines $ 429 $ - $ 429
Production 256 12 244
Merchant Energy (93) 663 (756)
Field Services 28 1 27
Corporate and Other (46) 22 (68)
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Total $ 574 $ 698 $(124)
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First Quarter 2002
----------------------------------------------------
Pro forma Non-Rec Reported
Total EBIT by segment EBIT Charges EBIT
----------------------------------------------------
Pipelines $ 399 $ - $ 399
Production 209 33 176
Merchant Energy 435 342 93
Field Services 51 - 51
Corporate and Other (6) - (6)
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Total $ 1,088 $ 375 $ 713
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