More From Victor Cheng
EPD’s Crude Oil Pipeline Has Been Increasing since 2010
The operating margin of EPD’s crude oil pipeline segment has been increasing since 2010 due to increases in volume, average tariffs, and other fees.
How US Oil Production Impacts MLPs
Oil production in the US has increased drastically due to new technologies and the application of hydraulic fracturing and horizontal drilling.
How to Invest in Master Limited Partnerships
An investor can invest in MLPs directly by purchasing the units from the stock exchange or through exchange-traded funds, exchange-traded notes, and mutual funds.
Most MLPs Today Focus on the Oil and Gas Sector
Currently close to 130 MLPs that trade on major exchanges have a primary focus on oil and gas midstream and downstream activities.
How EPD Increased Operating Income in Its Petrochemical Segment
EPD’s Petrochemical segment’s operating income has been increasing since 2010 due to higher propylene sales margins and lower maintenance expenses.
Analyzing How Williams Partners’ Segments Performed in 1Q15
For the quarter, the Atlantic-Gulf segment’s adjusted EBITDA increased by 25.9% to $335 million—compared to $266 million for 1Q14.
Western Gas Partners Reports Higher Cash Distribution in 1Q15
Western Gas Partners increased its cash distribution from $0.16 per unit in August 2008 to $0.72 per unit in April 2015.
EPD’s Onshore Crude Oil Pipelines & Services Segment
EPD’s Onshore Crude Oil Pipelines & Services segment includes approximately 5,400 miles of onshore crude oil pipelines, crude oil storage terminals, and crude oil marketing activities.
EPD’s Offshore Pipelines & Services Segment
EPD’s Offshore Pipelines & Services segment includes approximately 2,350 miles of offshore natural gas and crude oil pipelines and six offshore hub platforms.
Williams Partners’ Expected Capex Outlook for Fiscal 2015
Williams Partners’ capex (capital expenditure) for 1Q15 was $735 million—1.5% higher than 1Q14. It expects the total capex for the rest of 2015 to be ~$3,955 million.
Why Williams Partners’ Stock Dipped after Its 1Q15 Earnings
Williams Partners’ (WPZ) stock price decreased 1.1% from $49.90 per share to $49.40 per share after it announced its fiscal 1Q15 results on April 30, 2015.
EPD’s Natural Gas Liquids Pipeline Segment Shows Marginal Increase
EPD’s natural gas processing subsegment has been declining since 2013 due to low natural gas prices in 2013 and 2014.
Why NGL Fractionation Is an Important Subsegment for EPD
Fractionation is the process through which mixed natural resources are separated into pure form that can be taken up by the end users.
EPD’s Most Profitable Segment: NGL Pipelines & Services
EPD’s Natural Gas Liquid Pipelines & Services segment involves natural gas processing plants and NGL marketing activities.
How EPD’s Crude Oil Transportation Volume Affects Revenue
Transported volumes have increased significantly for EPD’s Crude Oil Pipelines and Services segment due to expansion of the Eagle Ford Crude Oil Pipeline system and the Seaway Pipeline.
How the Changing Natural Gas Scenario Affects MLPs
Since significant pipeline capacity will be added in the coming years, it will directly affect midstream MLPs with a good cash position, strong parent companies, and a clear growth outlook.
How Commodity Prices Impact MLPs
MLPs involved in oil and gas production, gathering and processing, and coal have significant exposure to commodity price fluctuations.
An Introduction to MLPs: A Framework for Investment
Master Limited Partnerships (or MLPs) are publicly traded partnerships that generally operate in the energy and natural resources sectors.
The Importance of Incentive Distribution Rights for MLPs
Incentive distribution rights (or IDRs) determine the share of cash distribution paid to the general partner (or GP) for managing the operations of the MLPs.
The Pros and Cons of Incentive Distribution Rights
Most MLPs restructure the IDRs when they reach high splits, as growth is capped. The markets view IDR restructuring favorably.
How Master Limited Partnerships Are Structured
A MLP’s ownership structure consists of a decision-making general partner (or GP) and a limited partner (or LP).
How MLPs Fund their Growth
MLPs fund their growth by raising more capital every year, as they distribute major portions of their cash flow to unit holders.
The Importance of the Distribution Coverage Ratio
The distribution coverage ratio is the most important ratio for MLPs, as it highlights the cash available to the LP unit holders divided by the cash distributed to LP unit holders.
What Are the Tax Implications of Investing in MLPs?
The IRS considers MLPs to be pass-through entities, so they are not required to pay corporate level federal income taxes.
Why It’s Important that MLPs Have a C-Corp as a Parent
Having a C-Corp as a parent company helps the MLP grow when there is fierce competition for new acquisitions and when new projects are difficult to build.
The Advantages and Disadvantages of Investing in MLPs
MLPs clearly stand out when compared to other asset classes because of their structure, yields as compared to other asset classes, and stability of cash distribution.
How Different Contracts Affect Master Limited Partnerships
There are various types of contracts in energy MLPs that each have their own advantages and disadvantages.
How Do Master Limited Partnerships Grow?
MLPs normally pay out all the available cash to the unit holders in the form of quarterly cash distribution. They hold only the maintenance capital expenditure.