Owning High-Quality MLP Names for the Long Term: An Expert Analyst Discusses Investing in the MLP Sector with The Wall Street Transcript

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: Do you expect M&A activity in the sector this year?

Mr. Edwards: We've already seen some, so I guess it's more accurate to ask, do we think we'll see more? The E&P MLPs, their fundamental business model is to do that, so I think there will be more there. Whether we'll see any more as far as combination of midstream players, it remains to be seen.

Despite the fact that the general partner, at least in theory, is supposed to have the say on things, in reality it has proven more difficult to get MLPs to acquire other MLPs, just because of the complexity of managing through the conflicts committees of multiple entities. The conflicts committees of both a GP and LP for both acquirer and target have to agree, which can get cumbersome, and so it has proven harder to get transactions done.

So we'll have to see, but I wouldn't be surprised if you continue to see some significant assets acquired. Whether whole companies - I don't want to get into speculating who I think would be targets, but I think there are a handful that are possibilities.

TWST: What are your favorite names in your coverage universe right now? Tell us a little bit about why.

Mr. Edwards: Our thesis for the last year or so, maybe even longer, has been to overweight the oily-related infrastructure names. We think that that thesis - while it's played out in a very large way, there are still lots of tailwinds. There's probably another five to seven years of production increase coming, as we discussed earlier, so there's going to be an ample amount of opportunity for alleviating the bottlenecks that that increase in production creates.

The interesting thing is these production increases keep surprising to the upside. Probably a year ago, the outlook was over five...

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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