MI - SPOT review schedule on hold as EPP gathers more information
- June 2020Enterprise Products Partners LP and Enbridge Inc. told the US Coast Guard and Maritime Administration that they needed more time to provide information about their joint project in Freeport, Texas—Sea Port Oil Terminal. SPOT is being built to load supertankers, specifically VLCCs that can take up to 85,000 bo per hour, or 2 MMbo/d. The application review schedule for the project was suspended after SPOT Terminal Services LLC asked for more time to gather information requested by the...
Jun 17, 2020
MI - Investor confidence trickling back with ‘cautious optimism’
- June 2020Midstream companies and MLPs have rebounded on the stock market significantly from their lows in March but are still down around 20% YTD, midstream and infrastructure fund specialist Alerian noted. The performance of the Alerian Midstream Energy Select Index (AMEI) is off 19.5% this year but still outshines all other major energy industry benchmarks. In its latest report, the group said that its 21-constituent MLP Infrastructure Index (AMZI) fell 67.4% from the end of 2019 through...
Jun 17, 2020
MI - Analyst Notes - June 17, 2020Enterprise Products Partners, LP (NYSE: EPD; $21.78-June 10; Buy; PT-$21) Updated capital budget of $2.5-3.0B came in ~$1.0B below prior guide, earning generally favorable feedback from investors. Reduced cash outlay combined with management commentary that FY marketing contribution may be similar to 2019’s $500-600mm on the back of contango benefits has seen EPD outperform in recent weeks as market looks to balance need for upside leverage with a general mistrust of the continued beta...
Jun 17, 2020
MI - Shippers & SPR helping producers with new storage solutions - May 2020Energy Transfer sought and obtained permission from the Texas Railroad Commission to turn two pipelines in the state into storage vessels for almost 2 MMbo, according to press reports. The company plans to “move product around” to idle the pipelines so that it can fill them with crude by mid-May, company sources told Argus. If Energy Transfer’s plan is approved, the company said it will be easy to add pumps to the lines. It’s a creative solution to a growing problem as Texas producers need...
May 06, 2020
MI - At $16.8B, midstream sector bond issuers led the way in Q1 - May 2020The midstream sector generated $16.8 billion of fixed income securities sales in Q1 according to Enverus’ Capitalize platform, the largest share of all of the $39.9 billion of energy industry debt issued during the quarter. With $4.5 billion principal amount of debt sold across five tranches, Energy Transfer LP was the sector’s largest issuer. Western Energy Partners was second with $3.5 billion issued across four tranches, and Enterprise Products Partners came in third with $3.0 billion....
May 06, 2020
MI - Sector a bond-buyer haven, but fish & beetles have other plans - May 2020With $16.8 billion of debt raised during Q1, midstream was again the lead US energy sector according to Enverus’ Capitalize platform (PG.3). Energy Transfer LP, which raised the most at $4.5 billion (and $1.6 billion in equity), is also using it to help alleviate a crude storage shortage (PG.1), as are owners of Jones Act vessels (PG.3). Enterprise Products Partners, which raised $3.0 billion during the quarter, also earned 7% higher net income YOY in Q1 (PG.13). The sector’s allure to debt...
May 06, 2020
MI - EPP’s Q1 ‘good momentum’ netted $1.35B before virus took hold - May 2020Enterprise Products Partners reported $1.35 billion of net income attributable to limited partners in Q1, up 7% YOY, although it generated 12.5% less revenue at $7.5 billion. Net income included $187 million of deferred tax benefits. Net cash flow from operating activities of $2 billion was up 73% YOY, and free cash flow of $916 million compared with just $2.7 million a year ago. Distributable cash flow of $1.6 billion was flat YOY and EPP distributed 1.7% more of it to unitholders at $0.445...
May 06, 2020
CM - EPP signs a new $1B revolver, has $6B in total loan capacity - April 2020Enterprise Products Partners LP signed a new 364-day, $1.0 billion revolving credit agreement through its Enterprise Products Operating LLC subsidiary. The additional facility increases the partnership’s borrowing capacity by 20% to $6.0 billion. The expanded funding would cover needs ranging from working capital to new projects or acquisitions. The interest rate for the new revolver is variable. Citi was lead arranger of the new facility. JP Morgan, Mitsubishi UFJ, Mizuho, TD...
Apr 24, 2020
MI - Midstream taking precautions but getting on with life - April 2020The midstream sector has not escaped the one-two punch of the coronavirus and the oil price war. As would be expected during a time like this, one of the first things that companies do is cut capital spending. The $2.5 billion Red Oak pipeline got the axe for now (PG.1) as Royal Dutch Shell decided to practice social distancing from the 16.45 mtpa Lake Charles LNG project (PG.1). The Keystone XL pipeline, on which TC Energy recently resumed building with a 2023 startup date, now faces new...
Apr 17, 2020
MI - Enterprise bolsters credit supply with another $1B revolver - April 2020Enterprise Products Partners LP signed a new 364-day, $1 billion revolving credit agreement through its Enterprise Products Operating LLC subsidiary. The additional facility increases EPP’s borrowing capacity by 20% to $6 billion. The expanded funding would cover needs ranging from working capital to new projects or acquisitions. The interest rate for the new revolver is variable. Citi was lead arranger of the new facility. JP Morgan, Mitsubishi UFJ, Mizuho, TD Securities, Scotia, RBC and BB&T...
Apr 17, 2020
MI - Enterprise breaks 15-year streak of quarterly dividend hikes - March 2020Enterprise Products Partners’ Q1 distribution will remain the same as what was paid for 4Q19, the first time in 63 quarters the distribution has not increased. The partnership is reviewing its capex program but will not announce any changes before the end of April, it said March 18. The Q1 distribution of $0.445 per common unit will be payable April 30. While unchanged from 4Q19, this distribution represents a 1.7% increase over 1Q19. Management said Jan. 30, when WTI was still over...
Mar 26, 2020
MI - Altus left hanging after Apache suspends Alpine High drilling - March 2020Apache Corp. will no longer drill the Alpine High formation in Reeves County, Texas, a stunning change that has left Altus Midstream in the lurch. The spinoff of Apache’s Alpine High midstream buildout took a $1.36 billion impairment in reaction and is looking at its options going forward. “We never expected to be in a situation where we were not going to be fully servicing Alpine High gas,” Altus CEO Clay Bretches said during the 4Q19 earnings conference call. Apache announced the...
Mar 05, 2020
A&D - Enverus acquires fellow SaaS innovator RS Energy Group
- February 2020Enverus acquired RS Energy Group, a technology and data-driven energy intelligence firm allowing investors and executives to operationalize analytics and increase transparency at enterprise scale. RSEG offers a single-solution SaaS platform to benchmark the competitive landscape, uncover M&A opportunities and allocate capital, complementing Enverus’ predictive/prescriptive analytics solutions. “This is about accelerating innovation through high-powered technology and is another active...
Feb 27, 2020
OFS - Enverus acquires fellow SaaS innovator RS Energy Group - February 2020Enverus acquired RS Energy Group, a technology and data-driven energy intelligence firm allowing investors and executives to operationalize analytics and increase transparency at enterprise scale. RSEG offers a single-solution SaaS platform to benchmark the competitive landscape, uncover M&A opportunities and allocate capital, complementing Enverus’ predictive/prescriptive analytics solutions. “This is about accelerating innovation through high-powered technology and is another active...
Feb 25, 2020
CM - EPP reports record net income & DCF, spending less in 2020 - February 2020Enterprise Products Partners reported $4.68 billion of net income attributable to limited partners in 2019, up 10% YOY, and a new record for the largest US midstream company by market cap. The partnership generated $32.8 billion of revenue, off 10% YOY, but cash flow from operations rose 6% to a record $6.5 billion, and free cash flow jumped 24% to $2.5 billion from the prior year. Distributions went up 2.3% in 2019 to $1.765/unit, representing a 59% payout ratio. EPP’s distributable...
Feb 21, 2020