Midstream giant Enterprise Products Partners, with a market capitalization of $57 billion, has attracted significant investor interest because of its simplified structure, 51 consecutive quarters of dividend growth and strong distribution coverage — $2.7 billion in retained cash in the last three years. The company has continued to build out its large integrated midstream network despite the plunge in commodity prices, investing almost $18 billion in organic growth projects and acquisitions in 2014-16. Enterprise (NYSE: EPD) is now connected to every major U.S. shale basin, every U.S. ethylene cracker and 90% of the refineries east of the Rocky Mountains. As a result, it is well positioned to benefit from the recovery in crude oil and natural gas production, especially in the Permian and the Eagle Ford; continuing NGL and crude oil exports; and the impending growth of the U.S. petrochemical industry. Today we discuss highlights from the first part of our new Spotlight analysis of EPD, which focuses on the company’s NGL Pipelines & Services segment.
Spotlight is a joint venture of RBN Energy and East Daley Capital Advisors. With the support of Oil & Gas Financial Analytics, Spotlight provides deep dives into the fundamentals that shape the outlook for midstream energy companies. Spotlight should not be viewed as investment advice. Spotlight is included as part of our Drill Down Report series, which is available to RBN Backstage Pass members. For more about Spotlight, click here.
The Crude Voyager is a weekly analysis of U.S. Gulf Coast loading activity that explains the ebbs and flows of crude loadings, destinations, and geopolitical issues impacting U.S. exports. It outlines the major paths for laden tankers hauling U.S. crude all over the world and reflects the change in tanker departures to the main regions that consume U.S. crude.
Enterprise Products Partners L.P. is a publicly traded midstream master limited partnership (MLP) that operates an integrated U.S. network of crude oil, natural gas, natural gas liquids (NGLs) and refined product midstream infrastructure. Its operations include pipelines, natural gas processing plants, liquid and gas storage, NGL fractionation, import and export terminals and marine transportation assets. In 2016, EPD generated $23 billion in revenue and $5.2 billion in earnings before interest, taxes, depreciation and amortization (EBITDA). EPD has four business segments:
- NGL Pipelines & Services, which includes natural gas processing plants and related NGL marketing activities; nearly 20,000 miles of NGL pipelines; NGL and related product storage facilities; 15 NGL fractionators; and liquefied petroleum gas (LPG) and ethane export terminals and related operations.
- Crude Oil Pipelines & Services, which consists of about 5,400 miles of crude oil pipelines and related operations, crude oil storage and marine terminals, and crude oil marketing activities.
- Natural Gas Pipelines & Services, whose assets includes 19,120 miles of natural gas pipeline systems that provide for the gathering and transportation of natural gas in Colorado, Louisiana, New Mexico, Texas and Wyoming. EPD also leases and owns underground salt dome natural gas storage facilities in Texas and Louisiana.
- Petrochemical & Refined Products Services, which includes propylene fractionation and related operations; a butane isomerization complex; octane enhancement and high purity isobutylene production facilities; and 4,250 miles of refined products pipelines, terminals and related marketing activities, and marine transportation.
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About the song
“Liquid Love” was the second track on the Isley Brothers’ 17th album, Winner Takes All, which was released on June 16, 1979.
