Navios Maritime Midstream Partners
Navios Maritime Midstream Partners (NAP), an MLP involved in the marine transportation of crude oil, refined products, and NGLs, was the top MLP gainer in the week ending April 20. Navios Maritime Partners rallied 29.2% due to J.P. Morgan upgrading it to a “buy.” Overall, the partnership has lost 55.4% since the beginning of 2018. The fall could mainly be attributed to the partnership’s weak operating performance in 4Q17. To learn more, read Comparing Crude Tanker Companies’ 4Q17 Performances.
Seadrill Partners (SDLP), an MLP formed by Seadrill Limited (SDRL) to own, operate, and acquire offshore drilling rigs, was the second-highest MLP gainer last week. Seadrill Partners shares jumped 20.8% in a strong week for MLPs. Last week, the partnership’s strong gains could be attributed to a sharp recovery in the US offshore rig count. According to Baker Hughes, the US total offshore rig count increased to 16 as of April 13, 2018, after falling to 2018 lows of 12 in previous weeks. The uptrend continued with the total offshore rig increasing to 18.
Legacy Reserves (LGCY), an upstream MLP involved in crude oil, natural gas, and NGL production, was the third-highest MLP gainer last week. Legacy Reserves rallied 10.8% last week mainly due to strong crude oil prices.
Legacy Reserves has remained among the top ten MLP gainers for several weeks since the beginning of 2018. Overall, Legacy Reserves has gained 262.1% since the beginning of 2018. The company’s strong YTD gains could be attributed to strong crude oil prices, strong fourth-quarter earnings, better financial position, and the announcement about moving from an MLP to a C corporation structure. The MLP structure has been a challenge for upstream MLPs since the rout in energy prices. MLPs aren’t able to distribute income under the challenging energy price environment.