67 WALL STREET, New York - March 21, 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: Plains All American Pipeline L (PAA), Magellan Midstream Partners LP (MMP), Western Gas Partners Lp (WES), DCP Midstream Partners LP (DPM), Anadarko Petroleum Corp. (APC), Kinder Morgan Energy Partners (KMP), Copano Energy LLC (CPNO) 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: And it seems these companies have plenty of access to capital to fund that growth.
Ms. Scotto: Yes, especially in this environment. We're in a low interest rate environment right now, and investors are looking for yield. MLPs offer nice yield and total return potential.
Recall, the MLP model is such that MLPs generally pay out the majority of their cash flow in the form of distributions. When MLPs make acquisitions or undertake growth projects, they tend to tap the debt and equity markets for funding. Currently, access to capital is readily available. We've already seen several equity deals completed since the start of the year, and we continue to see investor appetite. In addition to yield, we believe MLPs also provide investors a way to participate in the energy infrastructure build in the U.S.
TWST: Do you anticipate a normal amount of M&A activity this year, or more or less?
Ms. Scotto: I think we'll continue to see M&A activity this year. What we saw last year was several acquisitions of private-equity-backed companies, and I think that will continue this year. The drop-down acquisitions for the traditional drop-down stories, we expect those to continue.
It's harder to see MLPs acquiring other MLPs. Kinder Morgan (KMP) announced its intention to acquire Copano (CPNO). That was a relatively simple acquisition, because Copano did not have a general partner with incentive distribution rights. MLP-to-MLP M&A activity can be more challenging because there are four entities involved, the limited partner and the general partner for each 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.
- Investment & Company Information
- Master Limited Partnerships
- Kinder Morgan Energy Partners