How Richard built the fortune
Richard Kinder built his fortune by treating pipelines as toll roads. After leaving Enron in 1996, he and his college friend William Morgan bought Enron Liquids Pipeline, a modest partnership, for about 40 million dollars in early 1997 and renamed it Kinder Morgan. Their plan was to buy unglamorous assets such as pipelines and storage terminals, run them at low cost and pay out most of the steady cash flow to investors.
The company grew quickly through acquisitions. In 1999 Kinder Morgan merged with KN Energy, a natural gas pipeline company, which gave it a large network across the central United States. Kinder used a structure of publicly traded master limited partnerships, which paid little corporate tax, to finance growth and reward investors with rising distributions.
In 2007 Kinder led a management buyout that took the company private, and in 2011 he brought it back to the stock market in what was then the largest private equity backed initial public offering in American history. The 2012 purchase of El Paso Corporation made Kinder Morgan the biggest natural gas pipeline operator in the country. In 2014 he simplified the complex group by merging its partnerships into a single corporation. His wealth comes mainly from the large stake in that company he has held since its founding.
Companies and holdings
Kinder is executive chairman of Kinder Morgan Inc., based in Houston. The company operates:
- Tens of thousands of miles of natural gas pipelines and large gas storage capacity.
- Pipelines for refined products such as gasoline and jet fuel.
- Liquid and bulk terminals at ports and inland sites.
- Carbon dioxide pipelines and related oil field operations.
He served as chief executive from the founding until 2015, when Steven Kean succeeded him. Kim Dang became chief executive in 2023. Kinder has long taken a salary of one dollar a year, receiving his return through dividends on his shares.
Early life and career
Richard Dean Kinder was born in October 1944 in Cape Girardeau, Missouri. He earned an undergraduate degree and a law degree from the University of Missouri, where he became friends with William Morgan, his future business partner. After serving in the US Army, he practiced law in Missouri.
In 1980 he joined Florida Gas Transmission, a pipeline company, as general counsel. Through a series of mergers that company became part of Enron, and Kinder rose through the ranks, eventually becoming president and chief operating officer of Enron in 1990. He was widely seen as the disciplined operator who kept the company's ambitions grounded. He left in 1996 after it became clear he would not become chief executive, five years before Enron collapsed into bankruptcy amid an accounting scandal in which he was not implicated.
Philanthropy and public life
Kinder and his wife, Nancy, are among Houston's most prominent philanthropists. They signed the Giving Pledge in 2011 and give through the Kinder Foundation, which concentrates on urban green space, education and quality of life in Houston. The foundation was a major funder of Buffalo Bayou Park and of the Bayou Greenways project, which created a network of trails and parks along the city's waterways.
In 2010 the Kinders endowed the Kinder Institute for Urban Research at Rice University, which studies housing, transportation and social trends in Houston and other cities. They also funded the Nancy and Rich Kinder Building at the Museum of Fine Arts, Houston, which opened in 2020 and houses modern and contemporary art.
Kinder is known for frugality and a focus on cost control, both in his business and in public statements about corporate management. He has occasionally spoken about lessons from his years at Enron, emphasizing transparent accounting and conservative finances.
His career shows how infrastructure that is largely invisible to consumers can produce very large fortunes. By concentrating on fee based assets with long contracts rather than on commodity price bets, Kinder Morgan built a business that was less exposed to oil and gas price swings than many energy companies, although its share price has still experienced sharp declines, notably in 2015 when it cut its dividend.