tygnq83109.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)



11550 Ash Street, Suite 300, Leawood, KS 66211
(Address of principal executive offices) (Zip code)



David J. Schulte
11550 Ash Street, Suite 300, Leawood, KS 66211
(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, 2009



 
 
 
 
Item 1. Schedule of Investments.
 
Tortoise Energy Infrastructure Corporation
            
SCHEDULE OF INVESTMENTS (Unaudited)
            
             
   
August 31, 2009
  
Master Limited Partnerships and Related Companies - 164.0% (1)
  
Shares
    
Fair Value
  
Crude/Refined Products Pipelines - 79.3% (1)
            
United States - 79.3% (1)
            
Buckeye Partners, L.P.
     630,200     $ 29,606,796  
Enbridge Energy Partners, L.P.
     1,785,201       76,495,883  
Holly Energy Partners, L.P.
     503,100       18,428,553  
Kinder Morgan Management, LLC (2)
     1,574,500       74,521,085  
Magellan Midstream Partners, L.P.
     1,724,796       62,506,607  
NuStar Energy L.P.
     690,900       36,997,695  
Plains All American Pipeline, L.P.
     1,167,300       55,376,712  
SemGroup Energy Partners, L.P. (3)
     342,162       2,395,134  
Sunoco Logistics Partners L.P.
     754,700       42,851,866  
TEPPCO Partners, L.P.
     927,700       30,614,100  
              429,794,431  
                 
Natural Gas/Natural Gas Liquids Pipelines - 55.6% (1)
                
United States - 55.6% (1)
                
Boardwalk Pipeline Partners, LP
     1,274,000       29,824,340  
El Paso Pipeline Partners, L.P.
     1,412,000       27,421,040  
Energy Transfer Equity, L.P.
     554,110       14,900,018  
Energy Transfer Partners, L.P.
     1,620,700       65,703,178  
Enterprise Products Partners L.P.
     2,683,400       72,451,800  
ONEOK Partners, L.P.
     442,300       22,141,538  
Spectra Energy Partners, LP
     492,900       11,420,493  
TC PipeLines, LP
     1,174,400       42,865,600  
Williams Pipeline Partners L.P.
     802,865       14,836,945  
              301,564,952  
                 
Natural Gas Gathering/Processing - 19.0% (1)
                
United States - 19.0% (1)
                
Copano Energy, L.L.C.
     878,200       13,638,446  
Copano Energy, L.L.C. (3) (4)
     285,740       4,137,515  
DCP Midstream Partners, LP
     973,677       21,800,628  
Duncan Energy Partners L.P.
     350,400       6,359,760  
Exterran Partners, L.P.
     137,000       2,139,940  
MarkWest Energy Partners, L.P.
     1,250,252       25,830,206  
Targa Resources Partners LP
     1,512,600       25,562,940  
Western Gas Partners LP
     205,075       3,455,514  
              102,924,949  
                 
Propane Distribution - 9.4% (1)
                
United States - 9.4% (1)
                
Inergy, L.P.
     1,839,398       51,282,416  
                 
Shipping - 0.7% (1)
                
Republic of the Marshall Islands - 0.7% (1)
                
Teekay LNG Partners L.P.
     156,200       3,586,352  
                 
Total Master Limited Partnerships and Related Companies (Cost $641,033,533)
             889,153,100  
                 
Short-Term Investment - 0.1% (1)
                
United States Investment Company - 0.1% (1)
                
Fidelity Institutional Government Portfolio - Class I, 0.19% (5) (Cost $425,783)
     425,783       425,783  
                 
Total Investments - 164.1% (1) (Cost $641,459,316)
             889,578,883  
                 
Other Assets and Liabilities - (19.8%) (1)
             (107,356,347 )
                 
Long-Term Debt Obligations - (31.4%) (1)
             (170,000,000 )
                 
Preferred Shares at Redemption Value - (12.9%) (1)
             (70,000,000 )
Total Net Assets Applicable to Common Stockholders - 100.0% (1)
           $ 542,222,536  
 
(1) Calculated as a percentage of net assets applicable to common stockholders.
(2) Security distributions are paid-in-kind.
(3) Non-income producing.
(4) Restricted securities have been fair valued in accordance with procedures approved by the Board of Directors and have a total fair value of $4,137,515, which represents 0.8% of net assets.
(5) Rate indicated is the current yield as of August 31, 2009.

 
 
 
 
Various inputs are used in determining the value of the Company’s investments.  These inputs are summarized in the three broad levels listed below:
 
Level 1 – quoted prices in active markets for identical investments
Level 2 – other significant observable inputs (including quoted prices for similar investments, market corroborated inputs, etc.)
Level 3 – significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments)
 
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. 

On April 9, 2009, the FASB issued FASB Staff Position (FSP) No. FAS 107-1 and APB 28-1, Interim Disclosures About Fair Value of Financial Instruments, which amends FASB Statement No. 107, Disclosures About Fair Value of Financial Instruments (“FSP 107-1”), to require disclosures about fair value of financial instruments for interim financial statements of publicly traded companies as well as in annual financial statements.  FSP 107-1 also amends APB Opinion No. 28, Interim Financial Reporting, to require those disclosures in summarized financial information at interim reporting periods.  FSP 107-1 is effective for interim reporting periods ending after June 15, 2009.  The adoption of FSP 107-1 did not have a significant impact on the Company’s financial statements.

The following table provides the fair value measurements of applicable Company assets by level within the fair value hierarchy as of August 31, 2009.  These assets are measured on a recurring basis.

     
Fair Value Measurements at Reporting Date Using
     
Quoted Prices in
  
Significant
     
Active Markets for
Significant Other
Unobservable
 
Fair Value at
  
Identical Assets
Observable Inputs
Inputs
Description
August 31, 2009
  
(Level 1)
(Level 2)
(Level 3)
Equity Securities
          
Master Limited Partnerships and Related Companies(a)
$ 889,153,100
  
$ 885,015,585
$                   -
$ 4,137,515
Total Equity Securities
  889,153,100
  
  885,015,585
                    -
  4,137,515
Other
          
Short-Term Investment(b)
         425,783
  
         425,783
                    -
                 -
Total Other
         425,783
  
         425,783
                    -
                 -
Total
$ 889,578,883
  
$ 885,441,368
$                   -
$ 4,137,515

(a)  
All other industry classifications are identified in the Schedule of Investments.
(b)  
Short-term investment is a sweep investment for cash balances in the Company at August 31, 2009.


 
Fair Value Measurements Using Significant Unobservable Inputs 
 
 (Level 3) for Investments
 
For the period ended
August 31, 2009
Fair value beginning balance
$  3,924,726
Total unrealized gains included in net increase in net assets applicable to common stockholders
 
  1,317,262
Net purchases, issuances and settlements
                         -
Return of capital adjustments impacting cost basis of security
                         -
Transfers out of Level 3
                         (1,104,471)
Fair value ending balance
$  4,137,515

The Company utilizes the beginning of reporting period method for determining transfers into or out of Level 3.  Accordingly, this method is the basis for presenting the rollforward in the preceding table. Under this method, the fair value of the asset at the beginning of the period will be disclosed as a transfer into or out of Level 3, gains or losses for an asset that transfers into Level 3 during the period will be included in the reconciliation, and gains or losses for an asset that transfers out of Level 3 will be excluded from the reconciliation.
 
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, fair value per share and percent of net assets which the securities comprise at August 31, 2009.

Investment Security
Number of Shares
Acquisition Date
Acquisition
Cost
 Fair Value
Fair Value
Per Share
Fair Value as Percent of
Net Assets
Copano Energy, L.L.C.
Class D Common Units
  285,740
3/14/08
$  7,500,675
          $4,137,515
$  14.48
0.8%
 
As of August 31, 2009, the aggregate cost of securities for federal income tax purposes was $539,154,135.  At August 31, 2009, the aggregate gross unrealized appreciation for all securities in which there was an excess of fair value over tax cost was $365,612,756, the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over fair value was $15,188,008 and the net unrealized appreciation was $350,424,748.

 
 
 

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 27, 2009
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 27, 2009
By:
/s/ David J. Schulte  
    David J. Schulte  
    President and Chief Executive Officer  
       
  Tortoise Energy Infrastructure Corporation  
       
Date:  October 27, 2009
By:
/s/ Terry Matlack  
    Terry Matlack   
    Chief Financial Officer