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Vanguard Natural: A Strong Natural Gas Story

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Dec. 14 2016, Updated 1:35 p.m. ET

Vanguard Natural’s production mix

Vanguard Natural Resources’ (VNR) production mix was 16% crude oil, 14% NGLs (natural gas liquids), and 70% natural gas in 3Q16. Liquids make up 30% of its total production. VNR should benefit from its higher Natural Gas focus, considering the recent rally in natural gas prices.

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Production

Vanguard Natural Resources’ (VNR) average daily production fell to 423.8 Mcfepd (million cubic feet equivalent per day) in 3Q16, as compared to 445.3 Mcfepd in the second quarter of 2016, which represents a quarter-over-quarter decline of 4%.

VNR will likely increase its production to leverage the current rise in natural gas demand. However, VNR still has the largest production among upstream MLPs (master limited partnerships), including Memorial Production Partners (MEMP), EV Energy Partners (EVEP), and Legacy Reserves (LGCY).

In the next part of this series, we’ll discuss Vanguard Natural Resources’ deficiency payment plan.

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