Today’s recommendation is a growth-oriented MLP that is the leading processor of natural gas, NGLs and crude oil in the Marcellus region. The company recently entered a joint venture that will hopefully make it a leading company in the Utica shale as well. Igor Greenwald and Jason Burack of MLP Profits recently named the company a Best Buy.
MarkWest Energy Partners (MWE)
from MLP Profits
MarkWest Energy Partners (NYSE: MWE) is already the leading natural gas processor and NGL fractionator in the Marcellus, and the master limited partnership is aiming for a similar leadership role in the Utica joint venture with EMG Group, a Houston private equity firm that has agreed to finance up to $950 million of the JV’s investments.
That money is being spent to expand MarkWest’s current 185 million cubic feet (MMcf) of daily Utica gas gathering and processing capacity to nearly 600 MMcf/day by year’s end and almost 1,000 MMcf by the end of 2014.
To that end, MarkWest has signed dedicated acreage gathering deals with aggressive Utica drillers Gulfport, Antero Resources and Rex Energy (REXX). Their gas will flow to the two cryogenic processing units under construction at its Seneca plant in Ohio’s Noble county, each with the capacity to process 200 MMcf/d when both come on line later this year. ...
Longer term, MarkWest has unveiled plans for a joint venture with Kinder Morgan (KMP) that would build a large-scale processing plant in Tuscarawas county west of Cadiz with an initial processing capacity of 200 MMcf/d, expandable to more than one billion cubic feet daily based on customer commitments.
Gas would enter facility via a converted section of Kinder Morgan’s Tennessee Gas Pipeline (TGP) and NGLs would be sent via another converted section of the TGP as well as new pipes on a 1,100-mile journey to Mont Belvieu, Texas along the Gulf Coast.
The pipeline, which would have an initial capacity of 200,000 b/d that could eventually be doubled, would enter service in late 2015 pending regulatory approvals. MarkWest Utica EMG would have a 50% stake in the processing plant and a stake of up to 25% stake in the Gulf Coast pipeline.
Igor Greenwald and Jason Burack, MLP Profits, www.mlpprofits.com, 800-832-2330, October 2013