How EQM, AM, CNNX, and RMP Benefit from Strong Marcellus Focus



Marcellus natural gas production

Our four Appalachia-based gathering peers—EQT Midstream Partners (EQM), Antero Midstream Partners (AM), Cone Midstream Partners (CNNX), and Rice Midstream Partners (RMP)—have a significant presence in the Marcellus shale region. These companies’ 2Q16 throughput volume growth has been driven by strong Marcellus production growth. According to the monthly drilling productivity report released by the EIA (US Energy Information Administration), average natural gas production in the Marcellus region rose 9.3% YoY (year-over-year) in 2Q16.

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Notably, production in the region has started to fall after reaching an all-time high in February 2016. But production is expected to rise again with the recovery in natural gas prices, driven by the growing natural gas demand in the US Northeast region. Moreover, these MLPs (master limited partnerships) are protected to a large extent from production declines through MVCs (minimum volume commitments) contracts.

In the next part, we’ll compare the leverages of our four select MLPs.


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