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Magellan Midstream Partners LP Message Board

not_totally_gray 47 posts  |  Last Activity: Feb 24, 2015 2:27 PM Member since: May 14, 1999
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  • Reply to

    After hours announcement

    by mtm_20120 Feb 23, 2015 6:28 PM
    not_totally_gray not_totally_gray Feb 24, 2015 2:27 PM Flag

    IMO the initial reaction is pretty positive... shares were sold at $75.50, opened for public trading a dollar above that, and then added another $1 by mid-day. That tells you that not only were the new shares snapped up, lots of other folks took advantage of the dip to buy more. I bought some more myself first thing this morning at $76.47.

  • Reply to

    What the hell is golng on.

    by two4flintstone Feb 18, 2015 9:52 AM
    not_totally_gray not_totally_gray Feb 20, 2015 12:26 PM Flag

    why on earth would the dividend not be sustainable?
    the list of high-quality, non-distressed companies selling at 52-week low in this market is really short. hopefully more folks will notice this.

  • not_totally_gray not_totally_gray Feb 19, 2015 8:43 AM Flag

    I was going to make fun of this post until I looked at a chart and saw that even with all the punk news going on with RIG lately, it's still up from mid-December.

  • Reply to

    Gross is selling PDI

    by mgerner214 Feb 8, 2015 9:26 AM
    not_totally_gray not_totally_gray Feb 11, 2015 10:20 AM Flag

    wouldn't you kind of expect that given that he now works for their competitor? it was great that he said lots of nice things about his pimco funds after he left -- obviously he didn't want to trash them since he still owned a gazillion $$ worth -- but you'd expect him to sell out over time. I'd be surprised if he still owned a single share of Pimco-anything by a year after his departure.

  • Reply to

    lastest earnings

    by rjraecek Feb 10, 2015 9:37 AM
    not_totally_gray not_totally_gray Feb 10, 2015 1:40 PM Flag

    "Look at the whole sector"
    Not quite -- last week I swapped my HCN for HCP because there seemed to be a big valuation disparity. Since then HCN has holding up fine, HCP has been declining much more.

  • Reply to

    What would you do?

    by habitsowner Jan 30, 2015 3:46 PM
    not_totally_gray not_totally_gray Jan 30, 2015 4:19 PM Flag

    EPD. That 1.5X coverage ratio and conservative financial mgmt while energy markets are gyrating all over the place is a nice security blanket.

  • Reply to

    Spectra vs Kinder Morgan

    by jceandthegirls Jan 26, 2015 9:10 AM
    not_totally_gray not_totally_gray Jan 28, 2015 10:10 PM Flag

    I agree with that -- I can easily seeing them selling or spinning off the Canadian utility to focus on the midstream businesses and become more of a "pure play"

  • Reply to

    Spectra vs Kinder Morgan

    by jceandthegirls Jan 26, 2015 9:10 AM
    not_totally_gray not_totally_gray Jan 28, 2015 10:08 PM Flag

    I've owned KM for years, both the KMR LP shares and KMI before last year's take out, and I am *clearly* favoring SE vs KMI now. I recently sold some KMI -- for the first time in years -- and bought SE. Comparing the two, I think KMI is much more aggressively levered / smaller margin of error, plus they still get a large amount of cash flow from oil production that introduces a lot more risk -- given their IMO thin distribution coverage. SE is a much simpler play on North American nat gas demand/production, more conservatively managed, with better growth prospect simpler because they're a fraction of the size. IMO they're more similar to KMI 5 years ago in terms of benefiting from the IDR's of the captive MLP. What we learned from the KMx experience is how much better it is to own the GP instead of the LP, and I think that will play out again with SE vs SEP. (I'd also buy EPD instead of KMI at these prices, too.) Still own a large chunk of KMI, so I don't want to paint it as too negative, but new money definitely going to SE.

  • not_totally_gray not_totally_gray Jan 27, 2015 11:35 AM Flag

    they might, but ETE already controls the GP, so not much chance of success. That said, they're a fairly mercenary bunch, so if someone really wants to overpay I'm sure they'd consider selling it all.

  • not_totally_gray not_totally_gray Jan 27, 2015 11:33 AM Flag

    One, they're buying in all the RGP common units that they don't already own at a discounted price. Two, RGP projects will have lower cost of capital / better access to capital with higher credit rating. Three, I'm sure there will be lots of G&A costs they can eliminate by administering one company instead of two. Four, lots of people (read: investors) don't like how complicated ETE/ETP structure is, so anything that simplifies it makes it more attractive to future investors. Is it a huge impact for ETE? No, but it's just another step forward with basic mgmt blocking and tackling.

  • Reply to

    So what was that all about?

    by chinookcook2000 Jan 21, 2015 6:36 PM
    not_totally_gray not_totally_gray Jan 21, 2015 8:01 PM Flag

    normally I don't pay any attention to stuff like this, but $40 was a pretty hard double-bottom last fall, so I suppose it's not surprising that it would be a ceiling now -- today's high @ 39.59 just a little too convenient?

  • not_totally_gray by not_totally_gray Jan 21, 2015 12:25 PM Flag

    Thought these comments (from Charles Sizemore) were interesting --

    "Yes, the fracking revolution has turned the U.S. into an energy powerhouse again. American crude oil production is up 45% since 2000. And Russia and Canada have seen even bigger boosts to crude production, up 56% and 78%, respectively. (Note: Data are for crude oil and lease condensate and are through September 2014; they exclude natural gas plant liquids.)

    Yet production has collapsed in several traditional producers, such as Norway, Mexico, the United Kingdom and Venezuela. Overall, world output is only up about 13% since 2000. That’s less than 1% per year.

    The crude oil glut is looking a lot more like a dearth of demand than an abundance of new supply.

    Some of this is due to efficiency gains, of course. But we’re also seeing warning signs elsewhere. Retail sales were lower in December…despite the drop in gasoline prices that was supposed to give consumers extra cash to spend. The 30-year Treasury bond yield hit new all-time lows last week — yes, as in the lowest yields in history — and finished the week yielding 2.44%. And core Consumer Price Index inflation, which excludes energy and food, came in lower than expected at 1.6% for the year."

    Kind of supports the idea that fracking growth is an independent trend that is larger-scale than what is happening in current market and will continue to be necessary to meet worldwide oil demand. Couple that with what is happening in domestic nat gas market, the LT outlook for HCLP continues to be bright, IMO.

  • not_totally_gray not_totally_gray Jan 19, 2015 8:49 AM Flag

    this isn't the average MLP... profit margins on selling sand are ridiculous compared to operating a pipeline, there's no way they can shield it all with non-cash charges.

  • not_totally_gray by not_totally_gray Jan 16, 2015 10:43 AM Flag

    " Year over year, we have increased our quarterly distribution by 32%. We remain committed to delivering double digit annual growth in our distributions to our unit holders through similar quarterly increases.""

    After all the speculation and forecasts and what-not, at the end of the day, money talks.

  • not_totally_gray not_totally_gray Jan 15, 2015 1:12 PM Flag

    Realistically, you have to expect that a certain % of these "long-term" contracts will wind up being renegotiated. Even if HCLP has iron-clad language where they don't have to, if you're running a business in the real world you need to manage your relationships with your customers, and if that's what it takes to keep your customer, you do it if it makes sense. It does them no good to take a hard-line enforcing current contracts at customers' expense, if you piss them off and they jump to your competitor as soon as contract is up. Especially with all the sand companies adding so much capacity. Renegotiating volume commitments/flexibility in favor of longer-term and/or better pricing might make sense for everyone, even if there is a short-term hit to cash flow.

  • Reply to

    From Bloomberg 1/15/2014

    by buybackerer Jan 15, 2015 10:56 AM
    not_totally_gray not_totally_gray Jan 15, 2015 1:06 PM Flag

    That's nice as far as it goes, but the reason things are selling off isn't because of current drilling, but what happens 6-9-12 months from now. I think HCLP will be fine even so, but these ultra-short-term "everything is fine" articles miss the point.

  • Reply to

    I hate to point this out, but . . .

    by bicepsbunny Jan 8, 2015 4:31 PM
    not_totally_gray not_totally_gray Jan 13, 2015 10:04 AM Flag

    your event risk on the short side is simply that the Saudis/UAE announce a "deal" after all to reduce production, and oil shoots up $30 overnight.

  • Reply to


    by maven37514 Jan 12, 2015 10:19 AM
    not_totally_gray not_totally_gray Jan 12, 2015 11:03 AM Flag

    no one cares anymore about 2015 hedges -- the questions are, a) what does bbep's profitability (and distribution outlook) look like if oil price recovers to, say, mid-60s instead of mid-90s; b) what happens to their cost of capital for developing and maintaining production; and c) what happens to current equity holders if they need to raise new equity at terms that are massively dilutive to current shareholders?
    This is nothing specific to bbep, of course, they apply to all leveraged e&p and related companies, but those are the risks that are driving the latest rounds of selling, not the 2015 cash flow/distribution.

  • not_totally_gray by not_totally_gray Jan 9, 2015 12:38 PM Flag

    if the price of natural gas liquids is down along with oil & nat gas, that should reduce APU's cost as well, shouldn't it? And current frigid weather should be supporting retail price? So APU should be pretty well positioned for current market.

  • Reply to

    Excerpt from Nov 24 2014 seekingalpha

    by buybackerer Jan 7, 2015 10:16 AM
    not_totally_gray not_totally_gray Jan 8, 2015 9:50 AM Flag

    nope, that was *sale* price in the 30s. Yahoo won't let me post a link to the article -- apparently you are no longer allowed to include links to people who don't pay money to yahoo -- but this excerpt gives you the idea:

    Crude prices on the NYMEX fell below $50 a barrel briefly on Monday, but managed to close the trading day at $50.04. Tuesday morning the price fell to $48.47 in early electronic trading.

    The really bad news is the price that Plains Marketing is offering to pay for crude oil produced in the Bakken shale play. Williston Basin Sweet (equivalent to WTI) fetched just $33.44 a barrel on Monday; Williston Basin Sour fetched just $24.33. No other grade of crude on the Plains price bulletin was priced lower than Williston Sour.

    In our earlier look at the top producers in the Bakken, we noted the added transportation costs of $19 a barrel for Bakken crude headed by rail to the east coast and $11 a barrel for crude headed to the Gulf coast by pipeline. Adding the transportation cost to east coast refineries to the posted price of $33.44 gives a price per barrel at the refinery of $52.44. Because east coast crude is benchmarked to Brent, not WTI, the price paid was 1.2% below Monday’s closing price of $53.11 per barrel of Brent.

    The calculation for Bakken crude headed for the Gulf coast is similar, though slightly worse. The impact on Bakken producers’ stock was immediate and unpleasant.

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