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Kinder Morgan Energy Partners Message Board

  • crysball2 crysball2 Jan 9, 2012 3:46 PM Flag

    BENTEK Report.... Must Read

    Bentek published an extremely NEGATIVE report on Pipeline MLP's and Pipeline ETN's

    Bottom line...........with all the Shale gas coming online in multiple plays acrross the USA the demand for long distance pipelines for NG will diminsih......this is exacerbated by the mild (so far) Winter....basically local gas [like Marcellus in the Northeast Corridor] can serve local markets without having to transport accross the country.

    Also has big implications for NG Storarge.

    As substantiation, they offer the shrikage in differentials between the various hubs.

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    • Still need method of getting from producing field well head to rail head

      meaning trucking (with some local storage at well head) or local pipe

      [as we all know the density of rail lines compared to highways has changed drastically since the 1950-60's when a lot of local rail lines and their rights of way were abandoned]

      all of which adds to costs and makes Schaeffer's idea less competitive

      there being little differential in price at the various wellheads because of growing supply does undercut value somewhat of long haul pipes

      but will not have the grave impact concluded in this BENTEK report

    • You don't have any idea what your trying to post SHORTIE ! ON IGNORE CRYSBALL2 for being

    • From a different but related report:

      U.S. Capital analysts Becca Followill and James Carreker pointed out in a note last Friday "just how big the Kinder Morgan family of companies will be in the pipeline space once the transaction closes." By the analysts' math, the consolidated KMI-El Paso would have a roughly 52% market share in the Rockies based on 2010 throughput figures for interstate pipelines and estimates for Ruby from regulatory filings last year. Clearly, some assets will have to be sold.

      . . .

      And as for REX? "We don't see Rockies Express as a likely sales candidate given its below-market returns (2010 estimated return on equity of 3.2%) and the fact that ConocoPhillips was unable to find a buyer at the right price for their 25% share in 2010," U.S. Capital said.