tygnq.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:  February 28, 2011



 
 
 
 
Item 1. Schedule of Investments.
 
Tortoise Energy Infrastructure Corporation
            
SCHEDULE OF INVESTMENTS (Unaudited)
            
               
     
February 28, 2011
  
Master Limited Partnerships and Related Companies - 164.9% (1)
  
Shares
    
Fair Value
  
Crude/Refined Products Pipelines - 66.1% (1)
            
United States - 66.1% (1)
            
Blueknight Energy Partners, L.P. (2)
     342,162     $ 2,788,620  
Buckeye Partners, L.P.
     1,134,390       73,531,160  
Enbridge Energy Partners, L.P.
     1,755,900       117,715,536  
Holly Energy Partners, L.P.
     616,000       36,744,400  
Kinder Morgan Management, LLC (3)
     1,750,460       114,847,691  
Magellan Midstream Partners, L.P.
     1,493,800       90,285,272  
NuStar Energy L.P.
     926,400       64,986,960  
Plains All American Pipeline, L.P.
     993,100       65,018,257  
Sunoco Logistics Partners L.P.
     807,900       71,491,071  
 
               637,408,967  
                   
Natural Gas/Natural Gas Liquids Pipelines - 65.5% (1)
                
United States - 65.5% (1)
                
Boardwalk Pipeline Partners, LP
     1,761,700       58,506,057  
Duncan Energy Partners L.P.
     424,700       17,298,031  
El Paso Pipeline Partners, L.P.
     1,254,300       47,287,110  
Energy Transfer Equity, L.P.
     522,610       21,003,696  
Energy Transfer Partners, L.P.
     2,272,000       124,573,760  
Enterprise Products Partners L.P.
     2,895,600       126,248,160  
Niska Gas Storage Partners LLC
     501,300       10,151,325  
ONEOK Partners, L.P.
     766,700       63,751,105  
PAA Natural Gas Storage, L.P.
     285,167       6,949,520  
PAA Natural Gas Storage, L.P. (4)
     700,771       15,332,870  
Spectra Energy Partners, LP
     493,020       16,205,567  
TC PipeLines, LP
     1,376,389       74,682,867  
Williams Partners L.P.
     960,200       49,795,972  
                631,786,040  
                   
Natural Gas Gathering/Processing - 23.9% (1)
                
United States - 23.9% (1)
                
Chesapeake Midstream Partners, L.P.
     358,116       9,325,341  
Copano Energy, L.L.C.
     999,440       36,189,722  
DCP Midstream Partners, LP
     1,106,100       46,743,786  
MarkWest Energy Partners, L.P.
     1,066,900       47,903,810  
Regency Energy Partners LP
     726,700       20,180,459  
Targa Resources Partners LP
     1,822,225       62,411,206  
Western Gas Partners LP
     205,075       7,431,918  
                230,186,242  
                   
Propane Distribution - 8.8% (1)
                
United States - 8.8% (1)
                
Inergy, L.P.
     2,043,700       84,772,676  
                   
Shipping - 0.6% (1)
                
Republic of the Marshall Islands - 0.6% (1)
                
Teekay LNG Partners L.P.
     156,200       5,948,096  
                   
Total Master Limited Partnerships and Related Companies (Cost $777,193,659)
             1,590,102,021  
                   
Short-Term Investment - 0.0% (1)
                
United States Investment Company - 0.0% (1)
                
Fidelity Institutional Government Portfolio - Class I, 0.01% (5) (Cost $98,684)
     98,684       98,684  
                   
Total Investments - 164.9% (1) (Cost $777,292,343)
             1,590,200,705  
                   
Other Assets and Liabilities - (39.7%) (1)
             (382,604,494 )
                   
Long-Term Debt Obligations - (17.6%) (1)
             (169,975,000 )
                   
Mandatory Redeemable Preferred Stock at Liquidation Value - (7.6%) (1)
             (73,000,000 )
Total Net Assets Applicable to Common Stockholders - 100.0% (1)
           $ 964,621,211  
                   
                   
(1)
Calculated as a percentage of net assets applicable to common stockholders.
                
(2)
Non-income producing.
                
(3)
Security distributions are paid-in-kind.
                
(4)
Restricted securities have been fair valued in accordance with procedures approved by the Board of Directors and
  
 
have a total fair value of $15,332,870, which represents 1.6% of net assets. 
  
(5)
Rate indicated is the current yield as of February 28, 2011.
                

 
 
 
 
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.

The following table provides the fair value measurements of applicable Company assets by level within the fair value hierarchy as of February 28, 2011.  These assets are measured on a recurring basis.

   
Fair Value at
                    
Description
  
February 28, 2011
    
Level 1
    
Level 2
    
Level 3
  
Equity Securities:
                        
Master Limited Partnerships and Related Companies(a)
   $ 1,590,102,021     $ 1,574,769,151     $ 15,332,870     $ -  
Total Equity Securities
     1,590,102,021       1,574,769,151       15,332,870       -  
Other:
                                
Short-Term Investment(b)
     98,684       98,684       -       -  
Total Other
     98,684       98,684       -       -  
Total
   $ 1,590,200,705     $ 1,574,867,835     $ 15,332,870     $ -  

(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 February 28, 2011.

Valuation Techniques
In general, and where applicable, the Company uses readily available market quotations based upon the last updated sales price from the principal market to determine fair value.  This pricing methodology applies to the Company’s Level 1 investments. 

An equity security of a publicly traded company acquired in a private placement transaction without registration under the Securities Act of 1933, as amended (the “1933 Act”), is subject to restrictions on resale that can affect the security's fair value.  If such a security is convertible into publicly-traded common shares, the security generally will be valued at the common share market price adjusted by a percentage discount due to the restrictions and categorized as Level 2 in the fair value hierarchy.  If the security has characteristics that are dissimilar to the class of security that trades on the open market, the security will generally be valued and categorized as Level 3 in the fair value hierarchy.

The Company utilizes the beginning of reporting period method for determining transfers between levels.  There were no transfers between levels during the period from December 1, 2010 through February 28, 2011.
 
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, fair value per share and percent of net assets which the security comprises at February 28, 2011.
 
 
 
Investment Security
 
 
Number of Shares
  
 
Acquisition Date
 
Acquisition
Cost
 
 
Fair Value
 
Fair Value
Per Share
  Fair Value as Percent of
Net Assets
PAA Natural Gas Storage, L.P.
Unregistered Common Units
700,771
2/8/11
$ 15,000,000
$ 15,332,870
$  21.88
1.6%

The carrying value per unit of unrestricted common units of PAA Natural Gas Storage, L.P. was $24.38 on December 23, 2010, the date the purchase agreement and the date an enforceable right to acquire the restricted PAA Natural Gas Storage, L.P. units was obtained by the Company.
 
As of February 28, 2011, the aggregate cost of securities for federal income tax purposes was $630,653,098.  The aggregate gross unrealized appreciation for all securities in which there was an excess of fair value over tax cost was $963,388,848, the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over fair value was $3,841,241 and the net unrealized appreciation was $959,547,607.


 
 
 


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:  April 20, 2011
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:  April 20, 2011
By:
  /s/ David J. Schulte  
    David J. Schulte  
    President and Chief Executive Officer  
       
  Tortoise Energy Infrastructure Corporation  
       
Date:  April 20, 2011
By:
  /s/ Terry Matlack  
    Terry Matlack   
    Chief Financial Officer