MLP Market Update

MLP Market Update
Commentary on Master Limited Partnerships

Nov 16th, 2014

MLP Market Post

Week Thoughts: MLP Neutrality

MLPs finished the week down 0.6%, saved from a worse print by a 1.3% positive move on Friday.  The equal weight MLP index lagged the cap-weighted version by 80 basis points, continuing the trend discussed here last week.  The MLP index remains 5.7% below its peak at the end of August, but 11.2% higher than its mid-October low.

But again, oil’s slippery slide was the big story.  The U.S. benchmark oil futures price was down another 3.5% this week, with futures closing the week just under $76.00/bbl, around 23% lower than the spot price at the end of 2013.  Natural gas gave back its gains from last week, and dragged ethane down with it, both were down more than 7%.  MLPs held up pretty well given oil’s continued decline, but they are stuck in neutral post-earnings.  The Energy Transfer family of MLPs is holding its highly-anticipated analyst day this week, which may provide some catalysts to get MLPs back in gear.

Weekly MLP Review_11-14

MLPs, Oil and Interest Rates

At the request of a reader, below is a 10 year chart of the MLP Index compared with the price of oil and the interest rate on 10-yr US treasuries.  Not sure there is much to glean from the chart below, particularly given how different the MLP sector is today as compared with even just a few years ago.  Over the long term, MLPs have been fairly consistently higher as interest rates bounced around and oil stagnated after an initial bounce coming out of the financial crisis.

MLPs Crude Interest Rates

Below is a chart that illustrates just how much the sector has changed.  It’s a histogram of the 121 MLPs based on how old they are.  While about 77% of the sector’s market cap is 5+ years old and the cap-weighted average age of all MLPs is 11.4 years, the median age of all MLPs is 3.6 years.  66 MLPs, more than half of the sector, has been public less than 5 years.  Growth rates of those newer MLPs are much higher and with all the drop downs, those newer MLPs will grow much larger in the coming years as the sector continues to evolve.



Winners & Losers

QEPM reversed its recent downtrend this week and led all MLPs higher.  QEPM’s strong week was likely a read through from the slightly better deal EPD gave to OILT when the final merger terms were announced this week.  TLLP already announced their intention to take out the remaining units of QEPM at some point following the close of the acquisition of QEPM’s general partner.  If OILT and ACMP got improved deals on their mergers, perhaps QEPM investors will get a reasonable premium when its special committee negotiates its merger.

Speaking of OILT, it made the top 5 this week as well, based on the aforementioned agreement to merger terms with EPD.  TCP also had a strong week on the back of its GTN drop down announcement (see news section below).

On the downside, IPOs GLOP and RIGP, both 2014 IPOs with drop down stories and foreign parent companies, both made the list.  This comes on a week when fellow 2014 IPO Abengoa Yield, a yieldco with a drop down story and a foreign parent company, was down as much as 35.2% this week and closed 17% down week over week.  Questions about that company may have bled over into some of the foreign-backed MLPs.


DM took a break from the top five this week for the first time since its IPO.  RNO made it 4 straight weeks in the bottom 5, down another 11.8%.


Year to date, OILT popped back into the top 5 this week, displacing EQM.  QEPM clawed out of the bottom five, while NKA and RNO sunk deeper.  Both leaders (PSXP and TEP) dropped this week, but maintained their substantial leads over the rest of the sector.



News of the (MLP) World

No big M&A and a lot fewer earnings releases made this week feel downright peaceful.

Two more MLP IPOs did file initial registration statements this week (Smart Sand and Azure), bringing the total number of MLP IPOs on file to 13 (see table below for complete list), to go with 17 MLP IPOs so far this year (not counting Landmark Infrastructure, which falls in the non-energy MLP category.  One of those 17 MLP IPOs came this week, and it was not very well received, pricing at a near record yield, but in the wrong direction.

IPO Backlog_11-14


  • Mid-Con Energy (MCEP) priced public offering of 5.8mm units at $17.27/unit, raising $100.2mm in gross proceeds (press release)
    • Overnight offering, priced at 4.0% discount to prior close, and closed down 4.8% from pricing in the next session
  • Plains GP Holdings (PAGP) priced secondary offering of 60.0mm units at $25.00/unit, raising $1.5bn in gross proceeds for selling unitholder (press release)
    • Selling unitholder is a subsidiary of Occidental (NYSE: OXY)
    • 3 day marketed offering, with file-to-price decline of 7.4%
    • PAGP traded up 11.3% in the next session following pricing
    • Offering upsized from 55.0mm units
  • EnLink Midstream (ENLK) priced public offering of 10.5mm common units at $28.37/unit, raising $297.9mm in gross proceeds (press release)
    • Overnight offering, priced at 3.6% discount to prior close
  • Cheniere Energy Partners LP Holdings, LLC (CQH) priced public offering of 10.1mm shares at $23.25/share, raising $234.8mm in gross proceeds (press release)
    • Overnight offering, priced at 2.8% discount to prior close
  • Navios Maritime Midstream Partners (NAP) priced IPO of 8.1mm units at $15.00/unit (11.00% yield), raising $121.5mm in gross proceeds (filing)
    • NAP is a spinoff from Navios Maritime Acquisition (NYSE: NNA) that will own and operate crude oil tankers under long-term charter agreements
    • Priced well below the initial filing range
    • 0% yield was the worst for a non-variable distribution MLP in more than 2 years (since HCLP’s IPO in August 2014)
    • NAP opened at $13.20 and closed at $13.45, down 10.0% in its first session
  • Azure Midstream (AZUR) filed initial registration statement for MLP IPO to raise up to $175mm (filing)
    • AZUR will operate natural gas gathering and processing assets in North Louisiana and East Texas under long-term, fixed fee contracts with producers
    • Backed by PE-firms Energy Spectrum and Tenaska Capital Management
    • AZUR expects to have $37.0mm of EBITDA in 2015
  • Smart Sand Partners (SSLP) filed initial registration statement for MLP IPO to raise up to $100mm (filing)
    • SSLP produces Northern White frac sand from its sand mine and processing facility near Oakdale, Wisconsin
    • SSLP has contracted 96% of its production capacity under fixed price contracts with weighted average remaining contract life of 2.7 years
    • Has full IDRs up to 50% tier


  • Sunoco Logistics (SXL) priced $1.0bn worth of senior notes (press release)
    • $200mm of 4.25% senior notes due 2024 sold at 101.772% of par
    • $800mm of 5.35% senior notes due 2045 sold at 99.331% of par

M&A / Growth Projects

  • Enterprise Products (EPD) and Oiltanking Partners (OILT) announce merger agreement (press release)
    • OILT unitholders will receive 1.3 EPD units for each OILT unit
    • Ratio implies a 5.6% premium to OILT unitholders based on 9/30 stock prices, one day prior to announcement of the merger, and a 10.4% premium to OILT unitholders based on 11/10 price
  • White Cliffs Pipeline, LLC (owned by RRMS, PAA, WES and Noble Energy, Inc.) announced plans to expand capacity on the pipeline from 150,000 bbls/d to 215,000 bbls/d by adding horsepower, modifying pumps and adding stations (press release)
  • TC PipeLines (TCP) announced plans to acquire remaining 30% interest in GTN from parent TransCanada (press release)
    • Gas Transmission Northwest LLC (GTN) is a 1,353 mile pipeline that transports natural gas under long-term contracts from the Westrn Canada Sedimentary Basin and the Rocky Mountains to Oregon and California
    • TRP highlighted that it expects to drop down $1bn of worth of assets to TCP annually going forward

Hamm History

  • Harold Hamm’s divorce settlement was announced to be approximately $1.0bn (Forbes)
    • Hamm is worth around $14bn today, but before he became King of the Bakken (and the SCOOP), he was the chairman of an MLP that almost 10 years ago priced one of the smallest MLP IPOs ever ($45mm) Hiland Partners
    • A short 19 months later, Hiland Holdings GP, LP (HPGP) priced its IPO. HPGP owned L.P. and G.P. Interests (and IDRs) in Hiland Partners (see deal gift pictured below)
    • It was (and for now, it still is) the quickest GP IPO post MLP IPO
    • In June 2009, Hiland Partners and HPGP announced that it would be taken private by Harold Hamm, Hiland at $7.75/unit and HPGP at $2.45/unit
    • Speculation is that at some point Hamm’s midstream business might go public again someday, and it may even continue to be called Hiland


Nov 9th, 2014

MLP Market Post

Week Thoughts: MLPs Working Big to Small

MLPs kept pace with the slight gains of the broad stock market this week, even as oil prices touched multi-year lows mid-week.  MLPs caught up with the market with big gains Friday, when the MLP Index was up 2.0%.  Year to date total return for the MLP Index ended the week at a nice round 15%.  Elections in the U.S. gave Republicans control of the House and Senate, which seems to have been interpreted as a positive sign for development of energy resources and energy infrastructure.

Weekly MLP Review_11-7

Natural gas prices climbed for the second straight week, and are now well above $4.00. As producers develop drilling plans for next year drilling plans, don’t expect a reversal of the oil rig count growth back to natural gas.  But natural gas price strength is welcome for MLPs, even if it narrows the global LNG arbitrage.

Index Inferences

Large cap MLPs continue to drive the MLP Index higher, as the spread between the price return of the cap-weighted MLP Index and the Equal Weight version is now 600 basis points.  For historical context, for the last 11 years, the most the MLP Index has ever outperformed its Equal Weight version by is 785 basis points in 2008.  See below for an annual breakdown.

Equal Weight vs. AMZ

Overall, the Equal Weight version on average outperformed the cap-weighted version by more than 300 basis points.  Interestingly, the MLP Index has outperformed its Equal Weight counterpart just 5 times out of 11, and each time it was in a year when both indexes had produced less than 15% returns.  With the Alerian Index up exactly 15% this year, to keep consistent with history, smaller MLPs need to catch up by year end, or MLPs will be flat into year end.

To be clear, the constituents of each index are exactly the same, all that is different are the size of the individual MLP weights.  In the Equal Weight version, every MLP is a 2% weight.  In the cap weighted version, the largest MLP EPD is a 15.9% weight.

Winners & Losers

Antero Midstream’s debut this week was less stellar than recent IPOs, but still good enough to outpace all other MLPs this week.  Pricing the IPO 25% higher than the midpoint of the filing range took some of the juice out of the potential pop.  DM made it 3 straight weeks in the top 5, up another 10.7%, perhaps helped by AM’s IPO highlighting relative value for DM.  RNO made it to the bottom 5 again this week, down another 7.5%.  Three upstream MLPs made the bottom 5 (MEMP, EROC, LRE), with MEMP’s performance taking the bottom spot for the entire sector after MEMP posted results way below expectations on production and operating expenses.  MEMP also guided to $55m less EBITDA in 2014 compared with previous guidance.



Year to date, DM has in just three weeks managed to produce the 4th best return of all MLPs at 57.3%.  MPLX continued its ascent this week, moving ahead of EQM into 3rd place.




News of the (MLP) World

MLP earnings season is almost over, and earnings releases this week were accompanied by some very large growth project announcements and updates, along with a few sizeable acquisitions.  MLP IPO season is in full swing, with another IPO priced last week, two IPOs on the road and two more IPOs filed.  After this week, there will have been 18 MLP IPOs in 2014 with no signs of slowing down.


  • Antero Midstream (AM) priced IPO of 37.5mm units at $25.00/unit, raising $1.0bn in gross proceeds (press release)
    • AM opened at $30.50, and closed at $28.03, up 12.1% in its first session
    • Offering upsized from initial 37.5mm units during the marketing period
    • IPO yield of 2.7% ranks as the lowest ever for an MLP

Lowest Yields

  • AM’s IPO size of $1.0bn ranks as the largest IPO ever for an MLP

Largest MLP IPOs

  • Plains GP Holdings (PAGP) launched secondary offering of 55.0mm units with proceeds going to selling unitholder (press release)
    • Selling unitholder is a subsidiary of Occidental (NYSE: OXY)
    • Offering is being marketed over three days and is expected to price on Monday afternoon
    • Based on its current price, the offering could raise $1.4bn in gross proceeds to OXY
  • Navios Maritime Midstream Partners (NAP) launched IPO of 8.1mm units with midpoint IPO yield of 8.25%, expected to raise $162mm at the midpoint (filing)
    • NAP is a spinoff from Navios Maritime Acquisition (NYSE: NNA) that will own and operate crude oil tankers under long-term charter agreements
    • NAP’s initial assets consist of 4 oil tankers with an average remaining contract term of 7.7 years, and NAP will have the option to buy 7 additional tankers from its parent
    • NAP is selling a 42.5% stake in the IPO
    • NAP will have net debt of $106mm post-IPO, and expects to generate $34.6mm in distributable cash flow over the next 12 months
  • Rice Midstream Partners (RMP) filed initial registration statement to raise up to $425mm in an MLP IPO (filing)
    • RMP is a spinoff of midstream assets developed by Rice Energy (NYSE: RICE), a publicly-traded producer that went public in early 2014
    • RMP has acreage dedications with RICE under a 15-year, fixed-fee contract for gathering & compression covering 55,000 acres of RICE’s acreage in Washington and Green Counties in the Marcellus Shale in southwestern Pennsylvania
    • RMP will retain a ROFO on RICE’s Ohio (Utica shale) gathering system and RICE’s freshwater distribution systems serving its Marcellus and Utica acreage
    • RMP will have no debt after the IPO, very similar to other Marcellus MLP spinoffs Antero Midstream and CONE Midstream
    • RMP is expected to have $55.7mm in EBITDA the next 12 months
    • CEO and CFO have a combined age of 62 years old
  • Terryville Mineral & Royalty Partners (TRVL) filed initial registration statement to raise up to $150mm in an MLP IPO (filing)
    • Formed by Memorial Resource Development (NYSE: MRD) to own and acquire royalty interests and mineral interests from MRD and third parties
    • TRVL will have a minimum quarterly distribution and IDRs up to 25%, which distinguishes it from another royalty interest MLP VNOM, which pays a variable distribution
  • Landmark Infrastructure Partners (LMRK) launched IPO of 3.0mm units to raise $60mm at midpoint of price of $20.00/unit, 5.75% yield (filing)
    • LMRK owns a portfolio of real property interests leased to companies engaged in wireless communications, outdoor advertising and renewable power generation
    • Portfolio includes 701 sites across 42 states, 99% of which are leased, 88% of which are leased to large, publicly-traded companies with national footprints
  • Sunoco Logistics (SXL) files equity distribution agreement to sell up to $1.0bn worth of common units at the market (filing)
  • EnLink Midstream (ENLK) files equity distribution agreement to sell up to $350mm worth of common units at the market (filing)

M&A / Growth Projects

  • Plains All American (PAA) announced the $1.075bn acquisition of 50% interest in BridgeTex crude oil pipeline from Occidental Petroleum (press release)
    • PAA will acquire 50% interest in the 300,000 bbl/d pipeline which recently began service and transports oil from the Permian basin to the Texas Gulf Coast
    • PAA paying around 10x EBITDA, and PAA expects 1.5% accretion from the acquisition
  • Sunoco Logistics (SXL) announced $2.5bn Mariner East 2 Pipeline (press release)
    • The pipeline will transport 275,000 bbl/d of NGLs produced in the Marcellus and Utica shale to SXL’s Marcus Hook terminal in eastern Pennsylvania for export and local demand
  • Kinder Morgan Energy (KMP) announced the proposed Palmetto Project received sufficient committed volumes to proceed with the project (press release)
    • The 167,000 bbl/d pipeline will transport refined products across the southeastern U.S.
    • Anticipated to cost $1bn, supported by 5-10 year contracts
  • Enterprise Product (EPD) and Plains All-American (PAA) announce expansion of the Eagle Ford Joint Venture Pipeline system and plans to build a new terminal (press release)
    • EPD and PAA will construct a new condensate gathering system and expand storage capacity at the JV’s Three Rivers terminal
    • JV will also build a new terminal on the Corpus Christi ship channel which will connect to the Three Rivers terminal by a newly constructed pipeline
  • Seadrill Partners (SDLP) announced the acquisition of the West Vela drillship from sponsor Seadrill Limited (press release)
    • SDLP will acquire 51% interest in the West Vela at a cost of $433mm including the assumption of debt
  • Energy Transfer (ETP) announced plans to construct two new natural gas processing plants and associated gathering systems in the Eagle Ford shale and East Texas (press release)
    • ETP will build two 200mmcf/d processing plants
    • ETP will also construct the 200mmcf/d Volunteer Pipeline which will connect the East Texas plant to an ETP gas gathering system
  • Markwest Energy (MWE) announced plans to expand natural gas processing and fractionation capacity in the Utica shale (press release)
    • MWE, as part of the Markwest Utica EMG joint venture will construct an additional 200MMcf/d processing plant which will increase the JV’s total processing capacity to 1.5bcf/d
    • The JV also announced plans to construct a new 60,000 bbl/d fractionator in the Utica shale bringing total fractionation capacity to 274,000 bbl/d in the Marcellus and Utica shales
  • Plains All-American (PAA) announced plans to construct a new crude oil pipeline from Oklahoma to East Texas (press release)
    • Total capacity of the pipeline will be 150,000 bbl/d and is supported by long-term commitments
  • Sprague Resources (SRLP) announced acquisition of Castle Oil for $56mm (press release)
    • Castle Oil assets include the Port Morris terminal and its associated wholesale, commercial and retail fuel distribution business
    • The Port Morris terminal is the largest deepwater petroleum products terminal in New York City, with total storage capacity of 907,000 barrels

Nov 2nd, 2014

MLP Market Post

Week Thoughts: MLPs Fall Back

MLPs sold off this week, moving in the opposite direction of the broader stock market and other yield-based equities (like utilities).  Interest rates and commodity price movements likely weren’t much of a factor in the underperformance.  Distribution ex-date trading was likely in MLP weakness.  Another potential driver is MLP investors reassessing valuations and long term growth expectations in light of what appears to be a sustained lower commodity price environment.

Weekly MLP Review_10-31

This week’s price action, uncorrelated with oil prices or the broader stock market, is an affirmation (although not a welcome one when MLPs are down) of the lack of correlation between daily movements of oil prices and MLP price changes.  This week, we published a short whitepaper on the topic of MLP correlation with oil. You can find it here.

The end of this week marks the end of another month for MLPs.  October was the second straight negative month for the MLP Index, which was down 4.7% including distributions.  It was the worst October ever for the MLP Index.  November has historically been a weaker month on average for MLPs, but seasonality has been off this year, with an unusually strong August and weak September.

Extreme Growth MLPs

Shell priced its MLP IPO this week.  It was biggest, lowest-yielding MLP of all time, with the biggest first day pop after the IPO priced.  SHLX’s strategy (similar to DM, EQM, PSXP and other high-profile growth MLPs) appears to be to get to the 50% tier as quickly as possible to recognize the IDR value as soon as possible.

This quarter, PSXP announced a distribution that is 49.2% higher than IPO in just the 5th quarter since IPO.  That got me curious as to what the record is for the fastest MLP to get to the top tier.  The record is 6 quarters for now, and PSXP will join the 6 quarter club below.  EQM reached the 50% tier in 8 quarters.

Fastest to 50% tier:

  • 6 Quarters: Hiland Partners (which was taken private) and NGLS (Copano raised its distribution 50%+ in 6 quarters, but it had no IDRs)
  • 7 Quarters: DPM
  • 8 Quarters: MWE, TLLP, EQM

Investor push back at IPO on incentive distribution rights has not existed because IDRs are thought of as something that only becomes a problem much later.  If MLPs continue to push initial growth to the extremes, and total cash to the GP grows more quickly, does the life-cycle of some MLPs get shorter?  Do they more quickly reach the point KMP reached this year where the IDRs make it difficult for the MLP to grow?

A shorter life cycle eventually could put pressure on MLPs to have better mechanisms in place at IPO for keeping IDRs in check.  It’s hard for investors to push back when the growth MLPs have been so successful, but at some point the model might get too extreme, leading to a backlash among investors.  The backlash may come when these extreme growth start launching IPOs of their general partners within 2 years of their MLPs going public.

Winners & Losers

Commodity sensitive (NSLP), distressed (NKA and RNO) or oilfield services MLPs (HCLP and SDLP) comprise the bottom 5 this week.  The two most recent IPOs (DM and SHLX) and MLPs with strong earnings (ARLP) or announcements related to earnings (MPLX) dominated the top 5.  Expect IPOs and earnings announcements to continue to show up at the top and bottom ends of the MLP return spectrum next week.



For the month of October, IPOs ruled on the upside while dramatic revaluations dominated the downside.  SHLX and DM were both up more than 40%, followed by MPLX and ARLP each up more than 12%. On the downside in October, RNO and NKA were both down more than 50%, QEPM down 30%+ and upstream MLPs LGCY and NSLP were each down 20%+.  Compared to last month when large cap, mature MLPs topped the MLP charts, this month it was much younger or smaller MLPs in the top 5.


Year to date, MPLX’s big week pushed it up into the top 5, displacing RRMS.  NKA went from outside of the bottom 5 last week to second worst on the year this week.  BWP, which was an early favorite for biggest loser of the year early in 2014, has floated higher on the list.



News of the (MLP) World

This week we saw two high up-front multiple, strategic acquisitions totaling $2.3bn, and updates on several large scale pipeline projects and a merger.  But the highlight was the most successful MLP IPO of all time, on any measure.  SHLX may have felt like they left some money on the table given the huge IPO pop, but on day one Shell saw the value of its retained 71% interest in SHLX grow by $1.0bn, so I think they’ll be ok.



  • Shell Midstream (SHLX) priced IPO of 40.0mm units at $23.00/unit, raising $920mm in gross proceeds (press release)
    • IPO yield of 2.8% ranks as the lowest ever for an MLP
    • IPO size of $920mm ranks as the most ever raised in an MLP IPO
    • SHLX opened at $32.00, and closed at $33.55, up 45.8% in its first session, the biggest 1 day IPO pop for an MLP ever
    • Offering upsized from 37.5mm units originally offered
    • Below is a list of the 10 lowest MLP IPO yields ever. All have come in the last 16 months

Lowest Yields

  • Below is an updated list of biggest MLP IPO pops, 5 of which have happened in 2014.

IPO Pops_10-29


  • Western Gas (WES) prices public offering of 7.5mm units at $70.85/unit, raising $531.4mm in gross proceeds (press release)
    • Overnight offering, priced at 3.1% discount to prior closing price
  • Tallgrass Energy (TEP) files equity distribution agreement to sell up to $200mm of common units at the market (filing)
  • Enviva Partners (EVA) filed for $100mm IPO (filing)
    • Riverstone-sponsored wood pellet production MLP
    • $60.5mm of EBITDA
    • Full IDRs with 50% top tier

M&A / Growth Projects

  • Western Gas (WES) announced the acquisition of Nuevo Midstream for $1.5bn (press release)
    • Nuevo’s assets include an existing 300 mmcf/d natural gas processing plant, a 400 mmcf/d processing plant under construction, and other gathering infrastructure in the Delaware Basin
    • WES announced that to partially finance the acquisition it will issue $750mm of Class C units to Anadarko. Class C units will receive distributions in the form of additional Class C units and the units will not be subject to IDR payments until they are converted to common units
    • WES indicated that the purchase price represents an 8.5x multiple of 2016 EBITDA
    • As a result of a JV arrangement between Anadarko and another midstream operator, WES will offer 50% of the acquisition to that midstream operator, who will have 30 days to respond and another 30 days to pay for their 50%
  • Energy Transfer (ETP) announced Phillips 66 will be a joint venture partner on development of Bakken Shale crude oil pipelines (press release)
    • ETP will own 75% and Phillips 66 will own 25% of two large scale crude oil pipeline projects (Dakota Access Pipeline and Energy Transfer Crude Oil Pipeline) that will provide producers in the Bakken shale with access to markets in the Midwest and in Texas Gulf Coast area
  • ONEOK Partners (OKS) announced $800mm acquisition of Natural Gas Liquids pipeline assets from Chevron (press release)
    • OKS will acquire 80% interest in West Texas LPG Pipeline and 100% interest in the Mesquite Pipeline, which gather and transport NGLs from the Permian Basin to East Texas and Mt. Belvieu
  • Magellan Midstream (MMP) announces sufficient commitments to proceed with Saddlehorn Pipeline project (press release)
    • MMP announced commitments from Anadarko and Noble Energy
    • MMP also announced letters of intent with Anadarko and Saddle Butte Pipeline for potential equity investments in the pipeline
  • Breitburn Energy Partners (BBEP) announces $122.7mm acquisition of properties in the Midland Basin (press release)
    • Properties purchased from Antares Energy are adjacent to BBEP’s properties in Howard County
    • Financed with $50mm in cash and 4.3mm units issued to Antares
  • Williams Partners (WPZ) and Access Midstream (ACMP) announced merger agreement with updated terms from initial proposal (press release)
    • WPZ will merger with ACMP in a unit-for-unit exchange at a ratio of 0.86672 ACMP common units per WPZ unit
    • ACMP unitholders will receive an additional 6.3mm new common units prior to the merger
    • The net effect of these terms is that WPZ and ACMP are getting a better deal, at the expense of WMB
    • Merger is expected to close in early 2015
  • MPLX announced that parent MPC has offered to drop down remaining 31% of Pipe Line Holdings to MPLX (press release)
    • This drop down was announced as part of its 3Q results release, which also included a plan to accelerate distribution growth
  • Energy Transfer (ETP) announced that its ET Rover Pipeline project is fully subscribed at 3.25 bcf/d (press release)
    • ETP secured 3.25 bcf/d of binding shipper commitments under 15 and 20-year fee-based contracts
    • The 800-mile pipeline is expected to cost $3.8bn to $4.4bn and will transport natural gas from Marcellus Shale supply areas to demand centers in Michigan and in Ontario, Canada, but will also connect with ETP’s Panhandle Eastern Pipeline allowing shippers access to Gulf Coast markets


  • EROC re-instated distribution (of $0.07/unit), announced unit buyback program of up to $100mm (press release)
  • Notable Distribution Increases:
    • ATLS (+6.1%
    • MEP (+3.8%)
    • SRLP (+3.5%)
    • WNRL (+3.4%)
    • ACMP (+3.4%)
    • AHGP (+2.7%)
    • RGP (+2.6%)
    • ARLP (+2.0%)
    • SDLP (+1.8%)
    • EXLP (+1.8%)
    • DPM (+1.7%)
    • APL (+1.6%)