Domestic Oil Production Up Almost 40%; U.S. Close to Highest Production Levels in Over 21 Years and Likely to Reach Over 10 Million Barrels a Day By the End of the Decade

Wall Street Transcript

67 WALL STREET, New York - March 27, 2013 - The Wall Street Transcript has just published its Oil & Gas: Master Limited Partnerships Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Increasing Demand for Midstream Assets - U.S. Energy Infrastructure Build Out - Emerging Shale Plays - Oil and Gas Transportation Infrastructure Demand - Master Limited Partnerships Distribution Growth - Outlook for Natural Gas Liquids - Low Treasury Yields and MLP Dividends

Companies include: Genesis Energy LP (GEL), Plains All American Pipeline L (PAA), Targa Resources Partners LP (NGLS), Enterprise Products Partners L (EPD), Kinder Morgan Energy Partners (KMP), Magellan Midstream Partners LP (MMP) and many more.

In the following excerpt from the Oil & Gas: Master Limited Partnerships Report, an expert analyst discusses the outlook for the sector for investors:

TWST: It seems like exploration and production in the U.S. is still going strong.

Mr. Edwards: It is. What's been particularly surprising to the upside is on the oil side. In fact, I was just recently reviewing some of the data; the oil production is now running at over 7.1 million barrels a day. If you think about it, that's really an astounding accomplishment, because just two or three years ago the U.S. was around 5.3 million - so in two or three years production is up almost 40%. And we're now close to the highest production levels in over 21 years. That represents a dramatic reversal of production having been in decline for something like 23 years.

Now it looks like as a nation, the United States is more likely to reach over 10 million barrels a day in production by the end of the decade. To put that in perspective, that's a number that has not been seen since 1970. Of course, you'll recall that was when the peak oil theory was advanced. However, the advent of horizontal drilling technology has been able to reverse the decline, so it's really quite an achievement.

TWST: Are there any other technology advances or other trends impacting the space, particularly for the midstream players?

Mr. Edwards: This production trend has been percolating now for about five to seven years; we first saw it on the natural gas side, then it migrated to the natural gas liquids side and has since migrated to the oil. One thing we should bear in mind is natural gas demand is likely to start picking up because we now look like we have a 100-year supply.

The supply in front of us used to be a rolling eight to 10 years; it's much greater at this point, and so it looks like we're going to have reasonably low-cost energy for a very long time, particularly on the natural gas side...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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