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There have been some noteworthy additions to the resource links in the left hand column of this page. Two more MLP primers have been added - one from Merrill Lynch and one from Morgan Stanley - both at the naptp.org site. At the bottom of the resource list are links to my first two BDC [Business Development Company] Updates. I am still working on the "Intro to BDCs" in the November update, so here is my invitation to you to give me feedback and corrections on that effort. Additionaly, I seek reader input on the selection of new MLPs to include in the 2007 update. At the moment, those will be CLMT [if I can find DCFs], DPM, EROC, GEL and UCLP. Duncan Energy Partners and Atlas Energy Resources [ATN] are also potential additions. I am thinking about dropping all the 'shippers'. And one last change, the year-end yardsticks and strategic short cuts update has already been added - it is javascripted to change daily with each price update. It takes 84 pages [or computer 'screens'] of code to produce eleven computer screens worth of output - so it takes a while to find any bugs or outdated code - so I am starting early. Feedback on that effort is also welcomed. The spreadsheet below uses month ending data. The 'monthly price change' column is for unit price changes, while the 'year to date' stats is for total return [distributions plus unit price gains]. This explains the jumps in year to date gains in the distribution heavy months of February, May, August and November without similar gains in those month's unit prices. CEF numbers are for MLP and MLP-hybrid Closed-End Funds. The 'Ten Year Yield' numbers are for the US Treasury. Tracking the spread of the average MLP's yield to the Treasury [which I have done since January of 2005] has been a useful tool for timing of MLP purchases - according to this metric, buy MLPs when the spread is high. I have tracked the CEF spread since April 2006, and it is too early to tell if this number is meaningful. A new addition to this data is the CEF Price/NAV ratio, which is used in academia to measure investor sentiment. According to theory, buy MLPs when the price is at the largest discount to NAV.
WPZ Announces Equity Offering PRNewswire 12-04 Williams Partners [WPZ] announced that it intends to commence an underwritten public offering of 6.9 million common units representing limited partner interests. Williams Partners plans to use the net proceeds of the offering to fund a portion of the cash consideration for its planned $1.223 billion acquisition from Williams [WMB] of the remaining 74.9% interest in Williams Four Corners LLC that the partnership does not own. WPZ previously acquired a 25.1 percent interest in Four Corners from Williams for $360 million in June 2006. Four Corners owns certain natural gas gathering, processing and treating assets in the San Juan Basin in Colorado and New Mexico. Also on 12-04 WPZ announced that it intends to commence a private offering of $600 million aggregate principal amount of senior unsecured notes due 2017. TGP Acquires of Four LPG Carriers Businesswire 12-06 Teekay LNG Partners announced that it has agreed to acquire four liquefied petroleum gas (LPG) carriers for a total cost of $106 million. Upon their delivery to Teekay LNG, all of the vessels will commence service under long-term fixed-rate time-charters, and it is expected that they will generate approximately $11.6 million per annum in cash flow from vessel operations when all the vessels are delivered. Teekay LNG Partners L.P. provides LNG, liquefied petroleum gas (LPG) and crude oil marine transportation services under long-term, fixed-rate time charter contracts with major energy and utility companies through its fleet of thirteen LNG carriers, four LPG carriers and eight Suezmax class crude oil tankers. Eight of the thirteen LNG carriers and three of the LPG carriers are newbuildings scheduled for delivery between early 2007 and mid-2009. Moody's Affirms Enbridge Energy Rating, Changes Outlook to 'Negative' AP 12-08 Moody's Investors Service on Friday downgraded the rating outlooks for pipeline owner Enbridge Energy Partners LP and one its subsidiaries to "negative" from "stable." "The combination of EEP's financial profile, which Moody's considers to be weak for the rating category, and the execution risk associated with EEP's substantial capital program and equity and debt financing requirements underlie the change in the rating outlooks of both EEP and Enbridge Energy Limited Partnership, according to the ratings agency. Moody's said proposed organic growth capital expenditures of about $3 billion between 2007 and 2010 could strain the company's resources and increase its reliance on both equity and debt markets, heightening its exposure to market turbulence. Kinder Morgan and Energy Transfer Announce New Pipeline Project PRNewswire 12-13 Kinder Morgan Energy Partners and Energy Transfer Partners announced the two companies have entered into a 50/50 joint development of the Midcontinent Express Pipeline (MEP). The approximately 500-mile pipeline, which will originate near Bennington, Okla., be routed through Perryville, La., and terminate at an interconnect with Transco in Butler, Ala., will have an initial capacity of 1.4 billion cubic feet per day. MEP has prearranged binding commitments from multiple shippers for 800,000 dekatherms per day, which includes a binding commitment from Chesapeake Energy Marketing. MEP has executed a firm capacity lease agreement for up to 500,000 dekatherms per day with Enogex. The new pipeline will also interconnect with Natural Gas Pipeline Company of America (NGPL), a wholly owned subsidiary of Kinder Morgan, Inc. [KMI], and with the previously announced ETP 36-inch pipeline extending from the Barnett Shale and interconnecting with ETP's Texoma pipeline near Paris, Texas. KMP Announces Guidance for 2007 PRNewswire 12-14 Kinder Morgan Energy Partners [KMP] announced it expects to declare distributions of $3.44/unit for 2007 [compared to $3.23 in 2006]. "Towards the end of 2007 growth at KMP is expected to accelerate. We anticipate that the fourth quarter 2007 distribution per unit will be more than 10% higher than the Q4-06 distribution per unit. While we expect that we will continue to be able to grow the distribution per unit at KMP at about 8% per year over the long term, the increase in 2008 is expected to be greater than 8%, due mainly to the anticipated in service date of January 2008 for the western portion of the Rockies Express pipeline," KMP Chairman and CEO Richard D. Kinder added. TOO IPOs WSJ 12-14 Teekay Offshore opened at $25 on the New York Stock Exchange, up from its IPO price of $21. It sold seven million common units at the high end of its expected price range. The company, based in the Bahamas, was formed in August by Teekay Shipping (TK) to take over its offshore oil transportation and storage business; the parent continues to own 65% of the new company. Although Teekay Offshore is organized as a partnership, it elected to be taxed as a corporation for U.S. federal income tax purposes. It plans to pay an annual dividend of $1.40 a year. Teekay Offshore's general partner will be helmed by some of the same executives and directors that are at its parent, as well as at the general partner of another limited partnership that went public last year, Teekay LNG Partners L.P. (TGP). The company warns its interlocking management arrangement could lead to conflicts of interest. For the six months that ended in June, Teekay Offshore's net voyage revenue declined 8% to $338.4 million, and it reported a net loss of $16.8 million versus net income of $69.2 million in the same period of 2005. The company is forecasting an increase in voyage revenue in 2007 and a profitable year. Moody's Raises Outlook on Copano Energy AP 12-18 Moody's Investors Service on Monday changed its rating outlook for Copano Energy LLC, a natural gas pipeline operator and processor, to "positive" from "stable." Moody's said the upgrade came because Copano successfully shored up its balance sheet following its acquisition of ScissorTail Energy LLC last year, "both through strong operational performance and a demonstrated ability and willingness to issue equity." Copano's ratings also are supported by its position in active natural gas supply areas, its moderate downside risk to changes in commodity prices, high distribution coverage relative to its peers, an experienced management team and its limited liability company structure, which reduces the cost of issuing equity, according to Moody's. Copano's ratings could be upgraded next year, assuming continued strong operational performance, including volume growth, and other factors, Moody's said. Energy Transfer Partners Increases Distribution Businesswire 12-19 ETP announced a $0.075 increase in the annual distribution, to $3.075 annually. This $0.76875/unit distribution will be paid on January 15, 2007 to Unitholders of record as of the close of business on January 4, 2007. Enterprise Credit Ratings Upgraded by Standard & Poor's Businesswire 12-20 Enterprise Products Partners announced that Standard & Poor's has raised its corporate credit rating on the partnership and its operating subsidiary, Enterprise Products Operating L.P. to BBB- from BB+, with a stable outlook for both entities. Standard & Poor's also raised the rating on Enterprise's junior subordinated notes two notches to BB. Standard & Poor's said the upgrades reflect the partnership's improved credit protection measures and a greater diversity in its business mix that has been developed in recent years. They also noted that Enterprise has performed above expectations, both operationally and financially, since the purchase of the GulfTerra Energy Partners in 2004 and that some of Enterprise's major capital projects were expected to begin generating cash and earnings in 2007. On 12-01 Oppenheimer Initiated coverage of BPL at Neutral. On 12-20 Deutsche Securities Downgraded PAA from Buy to Hold. On 11-02 Citigroup Upgraded VLI from Hold to Buy and raised its price target to $60 from $55, citing attractive valuation. The broker also cited improved visibility to expansion projects as a reason for its upgrade. On 11-07 Wachovia Downgraded MGG from Outperform to Market Perform. On 11-08 Wachovia Downgraded TPP from Outperform to Market Perform and Goldman Sachs Upgraded TCLP from Sell to Neutral. On 11-14 Wachovia Downgraded TLP from Outperform to Market Perform. On 11-15 Wachovia Downgraded RGNC from Outperform to Market Perform. On 11-21 Oppenheimer Initiated coverage of ETE at Buy and Initiated coverage of epe at Buy. On 12-20 Plains All American Pipeline announced that it completed the sale of approximately 6.2 million common units to a group of institutional and private investors. Net proceeds were approximately $306 million. The Partnership now has approximately 109.4 million common units outstanding. On 12-20 Martin Midstream Partners announced that is has completed a private placement of 470,484 common units to Martin Resource Management Corporation, the owner of MMLP's general partner, at a purchase price of $31.88 per unit. MMLP received proceeds of approximately $15.3 million, including a capital contribution of approximately $0.3 million made by MMLP's general partner in order to maintain its 2% general partner interest in MMLP. On 12-01 FMO announced that it is increasing the quarterly dividend by 4.8% to $0.3275 per share, effective with the next distribution in January 2007. The increased dividend compares to the $0.3125 per share for the last quarterly dividend. On 12-11 Energy Income and Growth Fund [FEN] announced that it is increasing the quarterly dividend by 5.63% to $0.375/share from $0.3550/share, payable on January 31, 2007 to shareholders of record on January 18, 2007. On 12-14 Kayne Anderson MLP Investment [KYN] declared its quarterly dividend of $0.47/share payable on January 12, 2007 to common stockholders of record on January 5, 2007, with an ex-dividend date of January 3, 2007. On 12-14 Kayne Anderson Energy Total Return Fund [KYE] declared its quarterly dividend of $0.445/share payable on January 12, 2007 to shareholders of record on December 29, 2006, with an ex-dividend date of December 27, 2006. On 12-01 KYN announced its net asset value per share was $28.99. Its top seven holdings were: [1] Energy Transfer Partners - 14.1% [2] Magellan Midstream Partners - 8.9% [3] Enterprise Products Partners - 8.9% [4] Kinder Morgan Management - 7.7% [5] Plains All American Pipeline - 7.5% [6] Copano Energy - 6.8% [7] Crosstex Energy - 6.4%. On 12-01 KYE announced net assets of $806 million and its net asset value per share was $25.44 based on 31.7 million shares outstanding. As of November 30, 2006, equity and fixed income investments were 86% and 14%, respectively, of the Fund's total long-term investments of $1.1 billion. Long-term investments were comprised of MLPs and MLP Affiliates (45%), Canadian Income Trusts (24%), Marine Energy Transportation (13%), Coal Companies (8%) and U.S. Royalty Trusts and Other Energy Companies (10%). Its top ten holdings were KMR, PAA, EPD, KMI, XTEX, PennWest, Bonavista, Harvest, Crescent Point and Targa. On 11-7 the GP CAGR estimates were changed to reflect the average estimates from three brokerages. On 12-12 VEH announced that it will commence a secondary public offering of 17,869,565 of its units. VEH has 42.5 million units outstanding and an average daily volume of 160,132 units. Valero GP Holdings, LLC is a publicly traded limited liability company that owns the 2% general partner interest, a 21.4% limited partner interest and the incentive distribution rights in Valero L.P. On 12-18 VEH announced the pricing of its secondary public offering at $21.62 per unit. The offering is expected to close on or about December 22, 2006. On 12-12 Atlas America [ATLS] announces that its current wholly owned subsidiary, Atlas Energy Resources, LLC ("Atlas Energy"), which will own and operate substantially all of the natural gas and oil production assets and the investment partnership management business of the Company, has priced the initial public offering of 6,325,000 of its common units at $21.00 per unit. Atlas Energy Resources will begin trading tomorrow on the NYSE under the ticker symbol "ATN." Atlas America will own an 81% common unit interest and all of the Class A and management incentive interests in ATN. Atlas America also owns an 83% interest in Atlas Pipeline Holdings [AHD], a limited partnership which owns a 2% general partner interest, all the incentive distribution rights and 1,641,026 common units of Atlas Pipeline Partners [APL]. On 12-19 ETE announced an $0.11 per unit increase in annual distribution to $1.36 annually, or a quarterly distribution of $0.34/unit to be paid on January 19, 2007 to Unitholders of record as of the close of business on January 4, 2007. [Note: this new distribution is NOT used in the tables above. I wait to update ETE distributions until the other GPs have made their announcements - in order to compare apples to apples.] NOTE #1: This page is ment to be a supplement for those already getting monthly sector updates from another source. Data entry errors sporadically happen. Metrics like Debt/Market Cap and the GP/LP split ratios should not be ignored. NOTE #2: The operator of this site owns units in BWP, EPD, ETP, MWE and PAA, and units in GP ETE, and candidates for future acquisition include CPNO, HLND and WPZ - and this could distort the coverage of those MLPs. NOTE #3: Those wishing to contribute data to this site can do so by contacting Bob Martin at factoids@flash.net or by sharing data with one of the Yahoo user groups where people share their brokerage updates -- The only way we are going to get consensus DCF stats is if we build them ourselves, and that takes a team effort. The DCF numbers in the first spreadsheet and in the Forecaster spreadsheet users consensus DCF data that this site generates from four analysts/brokerages. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||