<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
---------------
Date of Report (Date of earliest event reported): October 16, 1997
LAKEHEAD PIPE LINE PARTNERS, L.P.
(Exact name of registrant as specified in its charter)
DELAWARE 1-10934 39-1715850
(State or other jurisdiction (Commission File No.) (I.R.S. Employer
of incorporation) Identification No.)
LAKE SUPERIOR PLACE, 21 WEST SUPERIOR STREET, DULUTH, MN 55802-2067
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (218) 725-0100
================================================================================
<PAGE>
ITEM 5. OTHER EVENTS
Press Release. The information set forth in the press release of the
registrant dated October 16, 1997, which is filed as an exhibit hereto, is
incorporated by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits:
Exhibit No. Description
- ----------- -----------
99.1 Press release, dated October 16, 1997.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
LAKEHEAD PIPE LINE PARTNERS, L.P.
(Registrant)
By: Lakehead Pipe Line Company, Inc.
as General Partner
/s/ M. A. Maki
------------------------------------
M. A. Maki
Chief Accountant
(Principal Financial and Accounting Officer)
Date: October 17, 1997
<PAGE>
EXHIBIT 99.1
[LAKEHEAD PIPELINE
LOGO APPEARS HERE]
NEWS
RELEASE
For Immediate Release
October 16, 1997 LK97-08
LAKEHEAD PIPE LINE PARTNERS, L.P. REPORTS THIRD QUARTER FINANCIAL RESULTS AND
CASH DISTRIBUTION
(Duluth, Minnesota, October 16, 1997) Lakehead Pipe Line Partners L.P. (NYSE:
LHP) today reported third quarter net income of $19.4 million, or $0.76 per
unit, compared with 1996 third quarter net income of $17.7 million, or $0.72 per
unit. For the nine months ended September 30, 1997 net income was $56.3 million,
or $2.22 per unit, compared with $30.6 million, or $1.23 per unit, for the same
period last year. The first nine months of 1996 include the impact of provisions
for prior years' rate refunds and interest recorded to reflect the retroactive
aspects of the 1996 tariff rate agreement between the Partnership and customer
representatives. Excluding these provisions, recalculated net income for the
first nine months of 1996 was $53.7 million, or $2.18 per unit.
A cash distribution of $0.78 per unit was declared today for the quarter ended
September 30, 1997, payable November 14, 1997 to unitholders of record November
6, 1997.
Deliveries for the third quarter increased to 1,527,000 barrels per day, 8%
higher than the same period of 1996. Deliveries for the first nine months of
1997 averaged a record 1,496,000 barrels per day versus 1,421,000 barrels per
day for the first nine months of 1996, an increase of 5%, or 75,000 barrels per
day. This increase is primarily attributable to capacity added during the
Partnership's 1996 System Expansion Program, combined with an increase in
western Canadian crude oil production.
Operating revenue for the third quarter of 1997 increased $4.4 million, or 6%
from third quarter 1996. Total operating expenses for the third quarter
increased $3.0 million, or 7% over the corresponding period of 1996, primarily
due to increased power costs.
<PAGE>
Operating revenue for the nine months ended September 30, 1997 was $6.1 million,
or 3% higher than the same period in 1996. Excluding provisions for prior
years' rate refunds included in the 1996 amounts, operating expenses for the
nine months ended September 30, 1997 were $5.0 million, or 4% higher than the
same period in 1996, again primarily due to increased power cost.
Construction commenced October 1 on a portion of the new 450 mile pipeline from
Superior, Wisconsin to Chicago, Illinois. Approximately 11 miles of 24-inch
pipeline will be installed this fall at six major river crossings and selected
other segments of the pipeline route. To date, expenditures of $57.1 million
have been incurred on acquisition of materials and rights-of-way for the new
line and other projects related to the 1997/1998 System Expansion Program.
Construction of the remaining pipeline and related projects is expected to
recommence in May 1998, with an anticipated in-service date of December 1998.
Lakehead Pipe Line Partners, L.P. owns the United States portion of the world's
longest liquid petroleum pipeline. Lakehead Pipe Line Company, Inc., an
indirect wholly-owned subsidiary of IPL Energy Inc. of Calgary, Alberta, holds
an 18% interest in the Partnership and serves as General Partner. The
Partnership's Class A Common Units are traded on the New York Stock Exchange
under the symbol "LHP." IPL Energy Inc. common shares are traded on the Toronto
and Montreal Stock exchanges under the symbol "IPL" and on the NASDAQ under the
symbol "IPPIF."
Fore more information contact:
Ron Karlen, Investor Relations
Telephone: (800) 525-3999
(218) 725-0570
Facsimile: (218) 725-0169
Internet: Home Page - http://www.lakehead.com
E-mail - [email protected]
-----------------------
# # #
<PAGE>
LAKEHEAD PIPE LINE PARTNERS, L.P.
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Three months Nine Months
ended ended
September 30, September 30,
- --------------------------------------------------------------------------------
(unaudited; dollars in millions, except 1997 1996 1997 1996
per unit amounts
<S> <C> <C> <C> <C>
- --------------------------------------------------------------------------------
Operating Revenue $72.3 $ 67.9 $207.9 $201.8
- --------------------------------------------------------------------------------
Expenses
Power 16.2 13.6 48.0 44.5
Operating and administrative 19.2 19.5 50.9 49.7
Depreciation 9.8 9.1 29.3 29.0
Provision for prior years' rate
refunds/(1)/ -- -- -- 20.1
- --------------------------------------------------------------------------------
45.2 42.2 128.2 143.3
- --------------------------------------------------------------------------------
Operating Income 27.1 25.7 79.7 58.5
Interest Income 2.0 2.5 7.1 7.1
Interest Expense (9.5) (10.3) (29.8) (34.6)
Minority Interest (0.2) (0.2) (0.7) (0.4)
- --------------------------------------------------------------------------------
Net Income/(1)/ $19.4 $ 17.7 $ 56.3 $ 30.6
================================================================================
Net Income Per Unit/(2)/ $0.76 $ 0.72 $ 2.22 $ 1.23
================================================================================
Units Outstanding (millions) -- -- 24.0 24.0
================================================================================
Recalculated Net Income/(3)/ -- -- -- $ 53.7
================================================================================
Recalculated Net Income Per Unit/(3)/ -- -- -- $ 2.18
================================================================================
</TABLE>
/1/ Net income for the first quarter of 1996 was restated to reflect the rate
refunds and related interest accrued in response to the 1996 tariff rate
agreement, which reduced net income by $23.0 million, or $0.95 per unit.
As provided in the 1996 tariff rate agreement, refunds are being paid
through a 10% reduction on current rates. This reduction will continue
until all refunds have been made. Based on the $61.7 million remaining
balance at September 30, 1997 and projected system deliveries, the 10%
credit is expected to remain effective until some time during the third or
fourth quarter of 1999. With the exception of interest that continues to
accrue on the unpaid balance, all refunds due as a result of the agreement
were accrued and reflected in net income prior to 1997.
/2/ Net income per unit is computed by dividing net income, after deduction of
the General Partner's allocation, by the number of Class A and Class B
Common units outstanding (24,002,750). Net income allocated to the General
Partner for the three month and nine month periods ended September 30,
1997, was $1.2 million and $3.0 million respectively, as compared to $0.5
million and $1.1 million for the same periods last year. The increase was a
result of the additional incentive income allocated to the General Partner
due to the increases in cash distributions per unit.
/3/ The "recalculated" information includes the impact of the tariff rate
agreement on the periods presented and excludes any amounts related to
prior years.
OTHER FINANCIAL AND OPERATING HIGHLIGHTS
(Nine months ended September 30)
<TABLE>
<CAPTION>
(unaudited; dollars in millions) 1997 1996
- --------------------------------------------------------------------------------
<S> <C> <C>
Cash Provided from Operating Activities $ 82.3 $104.9
Capital Expenditures $ 79.5 $ 52.5
Cash Distributions to Partners $ 53.5 $ 47.1
Deliveries (thousands of barrels per day) 1,496 1,421
Barrel miles (billions) 287 283
Average Haul (miles) 702 727
- --------------------------------------------------------------------------------
</TABLE>
