ONEOK Partners’ (OKS) Natural Gas Pipelines segment contributes 16% of the company’s operating income. The segment transports and stores natural gas.
ONEOK’s annual distributions per unit have grown at a CAGR of 8% since 2010. The company’s distribution coverage ratio fell to 0.6 in the first quarter of 2015.
ONEOK Partners (OKS) is an energy MLP that gathers, processes, and transports natural gas and NGLs (natural gas liquids). It also stores and distributes NGLs.
Spectra Energy Partners lost 2.4% on Friday. It’s just $0.20 away from breaching its 52-week low of $46.20. It has returned -18.6% YTD.
Energy Transfer Equity was one of the biggest losers among the midstream MLPs on Thursday, June 25. It gained the most at the end of trade on June 26.
Milder weather forecasts continued to push natural gas prices lower the next day as well. Prices fell by ~0.2% to settle at $2.726 on Tuesday.
Propane production is outstripping demand by a large margin. This explains the inventory build. This is bearish for propane prices.
What’s interesting to note is that XOP was outperforming both natural gas and UNG, again, for almost the entire week, but it gave the lowest returns in the group toward the end.
The EIA reports that total natural gas supply increased by 1.1% in the week ended June 19, compared to the previous week. Supply was 5.8% greater than in the corresponding week last year.
EOG Resources held its capex (capital expenditure) fairly steady compared to the levels over the past ten quarters. In 1Q15, the capex fell 23% to $1.54 billion.
EOG Resources’ equity value has eroded in the last four quarters. Its stock has fallen 24% due to the fall in crude oil and natural gas prices.
EOG Resources’ 1Q15 adjusted revenue fell 39% quarter-over-quarter. This was mainly a result of the fall in crude oil and natural gas prices starting in 2H14.
“Keep-whole” contracts are commodity-price sensitive. Under keep-whole contracts, MarkWest Energy Partners generally keeps a portion of the NGLs extracted through fractionation as payment.
Revenues from Range Resources for MarkWest Energy’s gathering and processing services accounted for 14% MWE’s total revenues in fiscal 2014.
MarkWest Energy Partners started operations at the Utica Shale in the third quarter of 2012. The company’s operations at the shale are still under development.
The Southwest segment contributes nearly one-third of MarkWest Energy Partners’ total net operating income. The segment has been enjoying higher NGL sales and increasing fee-based revenues.
Under percent-of-proceeds contracts, MarkWest gathers and processes natural gas on behalf of producer customers. The residue gas and NGLs produced from the processing are sold on the market.
MarkWest Energy’s five-year average distribution yield is 7.3%. It’s trading at a lower forward yield than its own historical average.
MarkWest Energy Partners is a midstream energy MLP formed in 2002. In this series, we’ll learn about its operations, its segments, and the factors that affect its performance.
The best performing midstream MLP on Thursday, June 25 was Western Gas Partners (WES). It rose 0.5% yesterday. However, it’s close to its 52-week low.