For many midstream companies, the experience of the past 12 months has been akin to falling down a flight of stairs. The fortunate sit at the bottom — stunned a bit, with arms and legs akimbo — and gradually determine that they’re generally alright, and that they’ll be more careful next time. The less lucky? They’re banged up and bloodied, and maybe headed to the ER and, after that, weeks of physical therapy. But were the “fortunate” really just lucky? Or were they in better shape, more athletic, more prepared for any eventuality? And what about companies when they’re hit hard with a sudden, negative shift in market conditions, out of the blue? Today, we discuss highlights from the second part of East Daley Capital’s 2021 edition of Dirty Little Secrets report, which examines the assets and outlooks of 26 leading midstream companies. We’ll focus on two representative midstreamers: Energy Transfer and EnLink Midstream.
As we said a few weeks ago in Down So Low, our blog about the first part of the report, the events of 2020 shook the North American midstream sector to its core and up-ended many midstreamers’ plans and expectations for the first half of the 2020s. A year ago, pre-pandemic, there was a general consensus among midstream executives that the boom years for energy infrastructure development were beginning to wind down; that the sector was entering an era of top-to-bottom reevaluation and rationalization; and that capacity was being overbuilt in some areas, most notably crude pipelines out of the Permian. All that remained true as COVID-19 took root and spread, but all kinds of new, troublesome issues arose, many of them related to the fact that less crude oil and refined products were being produced and transported by pipeline. Natural gas and NGL production and pipeline flows morphed too.
In Fight or Flight: Taking Stock of the Midstream, the 2021 edition of the Dirty Little Secrets report, our friends at East Daley again assess the challenges that individual companies — and the broader midstream sector — are up against through their Treadmill Incline Intensity (TII) index. The index (see Figure 1) builds upon a granular review of each midstreamer’s assets (gathering systems, processing plants, long-haul pipelines, fractionators etc.) to help determine how tough a time the company in question is likely to have in maintaining its earnings over the next four years — the steeper the incline, the harder the workout.
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About the song
“I’m Still Standing” was written by Elton John and Bernie Taupin. It appears as the second song on side one of Elton John’s 17th studio album, Too Low for Zero. Produced by Chris Thomas, the single was released in February 1983 and went to #12 on the Billboard Hot 100 Singles chart. It has been certified Gold by the Recording Industry Association of America (RIAA). Personnel on the record were: Elton John (lead vocals, piano, synthesizer), Davey Johnston (guitar, backing vocals), Dee Murray (bass, backing vocals), and Nigel Olsson (drums, backing vocals).
Too Low for Zero was recorded at AIR in Monserrat and Sunset Sound Recorders in Hollywood, CA, between September 1982 and January 1983, with Chris Thomas producing. It reunited Elton John with his backing band of the early 1970s. The album marked a comeback for him, as his previous four albums had yielded disappointing sales. Released in May 1983, the LP went to #25 on the Billboard Top 200 Albums chart and has been certified Platinum by the RIAA. Five singles were released from the album.
Sir Elton John (Reginald Kenneth Dwight) is an English singer, songwriter, pianist and composer who started his professional career in London in 1967. He has released 31 studio albums, five live albums, 18 compilation albums, 10 soundtrack albums, four EPs and 148 singles and has sold more than 300 million records worldwide. Sir Elton has won two Academy Awards, five Brit Awards, two Golden Globe Awards, six Grammy Awards, 10 Ivor Novello Awards, one MTV Video Music Award and one Tony Award. Elton John is a member of the Rock and Roll Hall of Fame and Songwriters Hall of Fame, and has a star on the Hollywood Walk of Fame. He continues to record but has retired from touring.
