Most people probably know that the past few years haven't been kind to natural gas producers, who saw prices for their product plunge to a decade low last spring. In response, most decided to curtail gas drilling as much as possible in favor of drilling for oil.
This tendency of energy producers to avoid the out-of-favor commodity is perhaps most evident in the U.S. rig count data. Over the past year and a half, the number of rigs drilling for natural gas has plunged by more than half. Yet U.S. natural gas production continues to shatter records.
Last year, total marketed production came in at 25.3 trillion cubic feet, the highest ever level of output. And production continues at astonishing levels of just under 65 billion cubic feet per day. What explains this paradox?
The nature of oil and gas wells
There are at least two important factors to consider here. The first has to do with the technicalities of drilling for hydrocarbons.
Despite industry jargon characterizing individual wells as "oil wells" or "gas wells," most wells actually produce a mixture of crude oil, natural gas liquids, and dry gas. Some plays, such as the Marcellus or the Haynesville, produce much more natural gas and gas liquids than oil, while others, such as the Bakken and the Eagle Ford, crank out much higher proportions of crude oil.
Zargon Oil & Gas Ltd. (Zargon), formerly Zargon Energy Trust, is engaged in the business of oil and natural gas exploration, exploitation, development, acquisition and production in Canada and the United States. During the year ended December 31, 2010, Zargon�� average daily production were 9,879 barrels of oil equivalent. Its properties are concentrated within the Western Provinces in Canada and in North Dakota in the United States. Its Williston Basin core area encompasses a portion of southeast Saskatchewan, southwest Manitoba and three counties of North Dakota. During 2010, it accounted 51% of its oil and liquids production. During 2010, its Alberta Plains South core area contributed 27% of its oil and liquids production. In June 2012, the Company sold 275 barrels of oil per day pertaining to all of its southwest Manitoba assets and selected properties in the Elswick area of southeast Saskatchewan.
Advisors' Opinion: - [By MLP Trader]
Here are the current top five companies in the list:
CompanySymbolEV/BOEPD/NetbackPrice/NAVEV/DACFPinecrest(PNCGF.PK)53564%4.0XLightstream(LSTMF.PK)131753%4.5XNovus(NOVUF.PK)133290%4.1XZargon(ZARFF.PK)138664%5.6XTwin Butte(TBTEF.PK)155885%5.5XOf the larger companies, one that remains obstinately near the top of the list is Lightstream . Lightstream trades at 40% of its book value and a whopping 13.4% yield.
Top Oil Companies To Own For 2014: EV Energy Partners LP (EVEP)
EV Energy Partners, L.P. (the Partnership) is engaged in the acquisition, development and production of oil and natural gas properties. As of December 31, 2011, the Company's properties were located in the Barnett Shale, the Appalachian Basin (which includes the Utica Shale), the Mid Continent areas in Oklahoma, Texas, Arkansas, Kansas and Louisiana, the San Juan Basin, the Monroe Field in Northern Louisiana, the Permian Basin, Central and East Texas (which includes the Austin Chalk area), and Michigan. On November 1, 2011, the Company acquired oil and natural gas properties in the Mid Continent area. On December 1, 2011, the Company along with certain institutional partnerships managed by EnerVest, acquired oil and natural gas properties in the Barnett Shale. It acquired a 31.02% proportional interest in these properties. On December 20, 2011, the Company, along with certain institutional partnerships managed by EnerVest, acquired additional oil and natural gas properties in the Barnett Shale. It acquired a 31.63% proportional interest in these properties. On February 7, 2012, the Company along with certain institutional partnerships managed by EnerVest, had a second closing on the oil and natural gas properties, and acquired a 31.63% proportional interest in these properties.
Barnett Shale
The Barnett Shale properties are located in Denton, Parker, Tarrant and Wise counties in Northern Texas. Its portion of the estimated net proved reserves as of December 31, 2011, was 647.4 one billion cubic feet equivalent (Bcfe), 72% of which is natural gas. During 2011, the Company drilled 35 wells. EnerVest operates wells representing 100% of its estimated net proved reserves in this area, and the Company owns an average 29% working interest in 976 gross productive wells.
Appalachian Basin
The Company�� activities are concentrated in the Ohio and West Virginia areas of the Appalachian Basin. Its Ohio area properties are producing from the Knox and Clinton f! ormations and other Devonian age sands in 41 counties in Eastern Ohio and 11 counties in Western Pennsylvania. Its West Virginia area properties are producing from the Balltown, Benson and Big Injun formations in 23 counties in North Central West Virginia. Its estimated net proved reserves as of December 31, 2011, were 126.4 Bcfe, 76% of which is natural gas. During 2011, it drilled 33 grosswells, 26 of which were completed. EnerVest operates wells representing 92% of its estimated net proved reserves in this area, and it owns an average 41% working interest in 8,670 gross productive wells.
Mid-Continent Area
The properties are located in 47 counties in Oklahoma, 17 counties in Texas, four parishes in North Louisiana, one county in Kansas and six counties in Arkansas. The Company�� estimated net proved reserves as of December 31, 2011, were 81.2 Bcfe, 63% of which is natural gas. During 2011, it drilled 82 wells, all of which were completed. EnerVest operates wells representing 33% of its estimated net proved reserves in this area, and it owns an average 12% working interest in 1,864 gross productive wells.
San Juan Basin
The properties are located in Rio Arriba County, New Mexico and La Plata County in Colorado. The Company�� estimated net proved reserves as of December 31, 2011, 68.6 Bcfe, 59% of which is natural gas. During 2011, it drilled two wells, one of which were completed. EnerVest operates wells representing 94% of its estimated net proved reserves in this area, and it owns an average 71% working interest in 227 gross productive wells.
Monroe Field
The properties are located in two parishes in Northeast Louisiana. The Company�� estimated net proved reserves as of December 31, 2011, were 60.9 Bcfe, 100% of which is natural gas. During 2011, it drilled one well, which was completed. EnerVest operates wells representing 100% of its estimated net proved reserves in this area, and it owns an average 100% working i! nterest i! n 3,930 gross productive wells.
Permian Basin
The properties are located in the Yates, Seven Rivers, Queen, Morrow, Clear Fork and Wichita Albany formations in four counties in New Mexico and Texas. The Company�� estimated net proved reserves as of December 31, 2011, were 54.1Bcfe, 37% of which is natural gas. During 2011, it did not drill any wells. EnerVest operates wells representing 99% of its estimated net proved reserves in this area, and it owns an average 93% working interest in 160 gross productive wells.
Central and East Texas
The properties produce primarily from the Austin Chalk formation and are located in 30 counties in Central and East Texas. Its portion of the estimated net proved reserves as of December 31, 2011 was 60.9 Bcfe, 46% of which is natural gas. During 2011, the Company drilled 16 gross wells, 15 of which were completed. EnerVest operates wells representing 93% of its estimated net proved reserves in this area, and it owns an average 12% working interest in 1,829 gross productive wells.
Michigan
The properties are located in the Antrim Shale reservoir in Otsego and Montmorency counties in northern Michigan. The Company�� estimated net proved reserves as of December 31, 2011, were 44.9 Bcfe, 100% of which is natural gas. During 2011, it did not drill any wells. EnerVest operates wells representing 99% of its estimated net proved reserves in this area, and it has an average 84% working interest in 370 gross productive wells.
Advisors' Opinion: - [By Arjun Sreekumar]
Houston-based EnerVest has also placed acreage for sale through its master limited partnership EV Energy Partners (NASDAQ: EVEP ) , after initial results came in under expectations. The MLP's CEO, Mark Houser, said the decision to sell out of the Utica was because oil production doesn't fit its low-cost business model. �
- [By Robert Rapier]
The second, and riskier, option is to buy MLPs engaged in natural gas production. While these tend to have some portion of their output hedged against sharp price fluctuations, they retain much more exposure to the ups and downs of natural gas prices than the midstream partnerships, which function as toll collectors.�EV Energy Partners�(NASDAQ: EVEP),�Atlas Resource Partners�(NYSE: ARP),�BreitBurn Energy Partners�(NASDAQ: BBEP) and�Memorial Production Partners�(NASDAQ: MEMP) are some of the upstream (oil and gas production) partnerships in the US shale plays.
- [By Matt DiLallo]
The big problem is that there aren't a lot of buyers, which is the issue that�EV Energy Partners� (NASDAQ: EVEP ) has run into with its own Utica sale. With major players like Chesapeake and Devon exiting, and foreign buyers like Sinopec already securing a foothold in the play, there are few buyers left that are willing to risk capital on a play that's no longer viewed as a sure thing. This has left EV Energy stuck with the 100,000 net acres it has been marketing since last year. The company has chosen to change its marketing strategy to sell the acreage in smaller packages to appeal to more buyers.�
Top Oil Companies To Own For 2014: Phillips 66 (PSX)
Phillips 66 is a holding company. The Company is engaged in producing natural gas liquids (NGL) and petrochemicals. The Company operates in three segments: the Refining and Marketing (R&M) segment, the Midstream segment and the Chemicals segment. The Refining and Marketing (R&M) segment purchases, refines, markets and transports crude oil and petroleum products, mainly in the United States, Europe and Asia, and also engages in power generation activities. The Midstream segment gathers, processes, transports and markets natural gas, and fractionates and markets NGL, predominantly in the United States. The Chemicals segment manufactures and markets petrochemicals and plastics on a worldwide basis. The Company�� operations encompass 15 refineries with a gross crude oil capacity of 2.8 million barrels per day, 10,000 branded marketing outlets and 7.2 billion cubic feet per day of gross natural gas processing capacity.
R&M
The Company�� R&M segment primarily refines crude oil and other feedstocks into petroleum products (such as gasolines, distillates and aviation fuels); buys, sells and transports crude oil; and buys, transports, distributes and markets petroleum products. This segment also engages in power generation activities. R&M has operations in the United States, Europe and Asia.
The Company�� Bayway Refinery is located on the New York Harbor in Linden, New Jersey. The refinery produces a high percentage of transportation fuels, such as gasoline, diesel and jet fuel, as well as petrochemical feedstocks, residual fuel oil and home heating oil. Its Trainer Refinery is located on the Delaware River in Trainer, Pennsylvania. Refinery facilities include fluid catalytic cracking units, hydrodesulfurization units, a reformer and a hydrocracker. The Alliance Refinery is located on the Mississippi River in Belle Chasse, Louisiana. The single-train facility includes fluid catalytic cracking units, hydrodesulfurization units and a reformer and aromatics unit. Alli! ance produces a percentage of transportation fuels, such as gasoline, diesel and jet fuel. Other products include petrochemical feedstocks, home heating oil and anode petroleum coke.
The Lake Charles Refinery is located in Westlake, Louisiana. Its facilities include crude distillation, fluid catalytic cracker, hydrocracker, delayed coker and hydrodesulfurization units. The refinery produces a percentage of transportation fuels, such as gasoline, off-road diesel and jet fuel, along with home heating oil. It owns a 50% interest in Excel Paralubes, a joint venture which owns a hydrocracked lubricant base oil manufacturing plant located adjacent to the Lake Charles Refinery. The Sweeny Refinery is located in Old Ocean, Texas, approximately 65 miles southwest of Houston. Refinery facilities include fluid catalytic cracking, delayed coking, alkylation, a continuous regeneration reformer and hydrodesulfurization units. It produces a percentage of transportation fuels, such as gasoline, diesel and jet fuel. Other products include petrochemical feedstocks, home heating oil and coke.
The Company�� Merey Sweeny, L.P. (MSLP) owns a delayed coker and related facilities at the Sweeny Refinery. Fuel-grade petroleum coke is produced as a by-product and becomes the property of MSLP. The Company owns 50% operating interest in Sweeny Cogeneration, a joint venture, which owns a simple cycle, cogeneration power plant located adjacent to the Sweeny Refinery. The plant generates electricity and provides process steam to the refinery, and it also provides merchant power into the Texas market.
The Company�� Wood River Refinery is located in Roxana, Illinois, about 15 miles northeast of St. Louis, Missouri, at the convergence of the Mississippi and Missouri rivers. Operations include three distilling units, two fluid catalytic cracking units, hydrocracking, coking, reforming, hydrotreating and sulfur recovery. The refinery produces a percentage of transportation fuels, such as gasoline,! diesel a! nd jet fuel. Other products include petrochemical feedstocks, asphalt and coke. Its Borger Refinery is located in Borger, Texas, in the Texas Panhandle, approximately 50 miles north of Amarillo. The refinery facilities consist of coking, fluid catalytic cracking, hydrodesulfurization and naphtha reforming, in addition to a 45,000-barrels-per-day NGL fractionation facility. It produces a percentage of transportation fuels, such as gasoline, diesel and jet fuel, as well as coke, NGL and solvents.
The Ponca City Refinery is located in Ponca City, Oklahoma. It is a high-conversion facility, which includes fluid catalytic cracking, delayed coking and hydrodesulfurization units. It produces a range of products, including gasoline, diesel, jet fuel, liquefied petroleum gas (LPG) and anode-grade petroleum coke. The Billings Refinery is located in Billings, Montana. Its facilities include fluid catalytic cracking and hydrodesulfurization units. The Ferndale Refinery is located on Puget Sound in Ferndale, Washington, approximately 20 miles south of the United States-Canada border. Facilities include a fluid catalytic cracker, an alkylation unit, a diesel hydrotreater and an S-Zorb unit. The Los Angeles Refinery consists of two linked facilities located about five miles apart in Carson and Wilmington, California. The San Francisco Refinery consists of two facilities linked by a 200-mile pipeline. The Santa Maria facility is located in Arroyo Grande, California, about 200 miles south of San Francisco.
As of December 31, 2011, the Company marketed gasoline, diesel and aviation fuel through approximately 8,250 marketer-owned or -supplied outlets in 49 states. At December 31, 2011, its wholesale operations utilized a network of marketers operating approximately 6,875 outlets that provided refined product offtake from its refineries. In addition to automotive gasoline and diesel, it produces and markets aviation gasoline, which is used by smaller piston engine aircrafts. As December 31, 2011,! aviation! gasoline and jet fuel were sold through dealers and independent marketers at approximately 875 Phillips 66-branded locations in the United States.
The Company manufactures and sells automotive, commercial and industrial lubricants, which are marketed worldwide under the Phillips 66, Conoco, 76 and Kendall brands, as well as other private label brands. It also manufactures Group II and import Group III base oils and market both globally under the respective brand names Pure Performance and Ultra-S. It manufactures and markets graphite and anode-grade petroleum cokes in the United States and Europe for use in the global steel and aluminum industries. It also manufacture and market polypropylene to North America under the COPYLENE brand name. Its ThruPlus Delayed Coker Technology, a process for upgrading heavy oil into higher value, light hydrocarbon liquids, was sold in June 2011. In October 2011, it sold Seaway Products Pipeline Company to DCP Midstream. In December 2011, the Company sold its 16.55% interest in Colonial Pipeline Company and its 50% interest in Seaway Crude Pipeline Company. The Company manufactures and sells a variety of specialty products, including pipeline flow improvers and anode material for high-power lithium-ion batteries. Its specialty products are marketed under the LiquidPower and CPreme brand names.
The Company owns four refineries outside the United States: the Humber Refinery, Whitegate Refinery, Melaka Refinery and Wilhelmshaven Refinery. The Humber Refinery is located on the east coast of England in North Lincolnshire, United Kingdom. It is an integrated refinery, which produces a high percentage of transportation fuels, such as gasoline and diesel. Humber�� facilities encompass fluid catalytic cracking, thermal cracking and coking. The refinery has two coking units with associated calcining plants, which upgrade the heaviest part of the crude barrel and imported feedstocks into light oil products and graphite and anode petroleum cokes.
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Th! e Whitegate Refinery is located in Cork, Ireland. The refinery primarily produces transportation fuels, such as gasoline, diesel and fuel oil, which are distributed to the inland market, as well as being exported to Europe and the United States. It also operate a crude oil and products storage complex consisting of 7.5 million barrels of storage capacity and an offshore mooring buoy, located in Bantry Bay, about 80 miles southwest of the refinery in southern Cork County.
The Mineraloelraffinerie Oberrhein GmbH (MiRO) Refinery, located on the Rhine River in Karlsruhe in southwest Germany, is a joint venture in which it owns an 18.75% interest. Facilities include three crude unit trains, fluid catalytic cracking, petroleum coking and calcining, hydrodesulfurization units, reformers, isomerization and aromatics recovery units, ethyl tert-butyl ether (ETBE) and alkylation units. MiRO produces a percentage of transportation fuels, such as gasoline and diesel. Other products include petrochemical feedstocks, home heating oil, bitumen, and anode- and fuel-grade petroleum coke. The Wilhelmshaven Refinery is located in the northern state of Lower Saxony in Germany, and has a 260,000 barrels-per-day crude oil processing capacity.
As of December 31, 2011, the Company had approximately 1,430 marketing outlets in its European operations, of which approximately 900 were Company-owned and 330 were dealer-owned. It also held brand-licensing agreements with approximately 200 sites. Through its joint venture operations in Switzerland, it also has interests in 250 additional sites.
Midstream
The Midstream segment purchases raw natural gas from producers, including ConocoPhillips, and gathers natural gas through pipeline gathering systems. Its Midstream segment is primarily conducted through its 50% investment in DCP Midstream. DCP Midstream also owns or operates 12 NGL fractionation plants, along with propane terminal facilities and NGL pipeline assets. It has a 25% inte! rest in R! ockies Express Pipeline LLC (REX).
Chemicals
The Chemicals segment consists of its 50% investment in CPChem. As of December 31, 2011, CPChem owned or had joint-venture interests in 38 manufacturing facilities. CPChem�� business is structured around two primary operating segments: Olefins & Polyolefins (O&P) and Specialties, Aromatics & Styrenics (SA&S). The O&P segment produces and markets ethylene, propylene, and other olefin products, which are primarily consumed within CPChem for the production of polyethylene, normal alpha olefins, polypropylene and polyethylene pipe. The SA&S segment manufactures and markets aromatics products, such as benzene, styrene, paraxylene and cyclohexane, as well as polystyrene and styrene-butadiene copolymers.
Advisors' Opinion: - [By Dan Caplinger]
In recent years, though, investors have discounted the potential impact of inflation on their portfolios. Consider these facts:
Gold is the traditional safe-haven investment for those who believe that inflation will take away the purchasing power of paper currency. Yet the plunge in gold prices has led to a mass exodus of investor interest in gold, with the popular SPDR Gold Trust (NYSEMKT: GLD ) losing billions of dollars not just due to price declines but also as investors have taken money out of the ETF entirely. Inflation-indexed bonds like the Treasury's TIPS have climbed so far in price that their real inflation-adjusted yields are negative, even for bonds that don't mature for another 20 years. That's been excellent news for existing investors in iShares Barclays TIPS Bond (NYSEMKT: TIP ) and similar inflation-indexed bond investments, but it presents no inflation protection for those considering purchases now. The sole fly in the inflation ointment has come from energy prices, with gasoline and heating-oil prices having remained stubbornly high despite plentiful domestic production from unconventional plays as refiners Phillips 66 (NYSE: PSX ) , Valero (NYSE: VLO ) , and others have greatly boosted their exports of refined products rather than letting Americans reap the benefits of high supply. Yet even the oil market has seen international spreads narrow, and gasoline prices have finally started to come down modestly, providing further downward pressure on inflation. Based on the conventional understanding of inflation, you'd think that all these signs of its demise were a good thing. The truth is far less clear.
- [By Tyler Crowe]
What several oil companies realized, though, is that moving oil by rail did one thing that pipelines could not: reach the East Coast and West Coast markets. Less than six months ago, the price spread between Bakken crude and imported Brent crude -- the primary source for East Coast refiners -- was over $20. So despite the premium to move by rail versus by pipeline, it was still well worth it for the refineries. Refiners and producers from the Bakken region have thus begun to move massive amounts of oil by rail. Continental Resources (NYSE: CLR ) , the largest producer of crude from the Bakken, now transports about 80% of all its crude by rail, and Phillips 66 (NYSE: PSX ) signed on to a five-year contract to receive 50,000 barrels per day of Bakken crude that will get there mostly by rail.
- [By The Part-time Investor]
Next I turned to Phillips 66 (PSX). I received PSX when it was spun off from ConocoPhillips (COP). I had held onto it since that time because I wasn't quite sure what to do with it. Should I buy more shares to bring it up to a full position? Or should I just sell it and move on? I wanted to see what kind of dividend policy PSX would develop before I made a decision, and it did recently raise its dividend by 24.8%. When I saw that I thought about bringing PSX up to a full position, but I also knew that PSX, even with the dividend increase, would have a yield of only 2.70%. In the end my desire to increase my portfolio yield over-ruled my pleasure with the dividend increase, and I sold my small position in PSX.
- [By Paul Ausick]
Kinder Morgan says the plant will cost $370 million, about 80% to 90% less than a full-blown refinery. Valero Energy Corp. (NYSE: VLO) and Phillips 66 (NYSE: PSX) have both indicated they may follow Kinder Morgan�� lead and build splitter plants of their own.
Top Oil Companies To Own For 2014: Pembina Pipeline Corp (PBA)
Pembina Pipeline Corporation (Pembina) is a Calgary-based company, engaged in providing transportation and midstream services. It owns and operates: pipelines that transport conventional and synthetic crude oil and natural gas liquids produced in western Canada; oil sands, heavy oil and diluent pipelines; gas gathering and processing facilities; and, an oil and natural gas liquids infrastructure and logistics business. It has facilities located in western Canada and in natural gas liquids markets in eastern Canada and the United States. Pembina also offers a spectrum of midstream and marketing services. Pembina�� Midstream business is organized into two segments: crude oil and NGL. The crude oil segment represents the Company�� midstream operations. The NGL segment includes two operating systems: Redwater West and Empress East. Pembina's Conventional Pipelines business consists of a pipeline network, located 7,850 kilometers, that extends across much of Alberta and British Columbia.
Advisors' Opinion: Top Oil Companies To Own For 2014: San Juan Basin Royalty Trust (SJT)
San Juan Basin Royalty Trust (the Trust) is an express trust created by the San Juan Basin Royalty Trust Indenture, between Southland Royalty Company (Southland Royalty) and The Fort Worth National Bank. The Trustee of the Trust is Compass Bank. The function of the Trustee is to collect the net proceeds attributable to the Royalty (Royalty Income), to pay all expenses and charges of the Trust and distribute the remaining available income to the Unit Holders. The Royalty conveyed to the Trust was carved out of Burlington Resources Oil & Gas Company LP�� (Burlington) working interests and royalty interests in certain properties situated in the San Juan Basin in northwestern New Mexico.
Burlington is the principal operator of the Underlying Properties. A percentage of the Royalty Income is attributable to the production and sale by Burlington of natural gas from the Underlying Properties. The Underlying Properties are primarily gas producing properties. The Underlying Properties consist of working interests, royalty interests, overriding royalty interests and other contractual rights in 151,900 gross (119,000 net) producing acres in San Juan, Rio Arriba and Sandoval Counties of northwestern New Mexico and 4,015 gross (1,158.5 net) wells. Gas produced in the San Juan Basin is sold in both interstate and intrastate commerce. Gas production from the properties totaled 32,580,756 million cubic feet (Mcf), during the year ended December 31, 2012. Gas produced from the Underlying Properties is processed at one of the five plants: Chaco, Val Verde, Milagro, Ignacio, and Kutz, all located in the San Juan Basin. Gas produced from the Underlying Properties and processed at Kutz is being sold under three separate contracts with Pacific Gas and Electric Company (PG&E), Shell Energy North America (US), LP (Shell) and New Mexico Gas Company, Inc. (NMGC).
Advisors' Opinion: Top Oil Companies To Own For 2014: Access Midstream Partners LP (ACMP)
Access Midstream Partners, L.P., formerly Chesapeake Midstream Partners, L.L.C. (Partnership), incorporated on January 21, 2010, owns, operates, develops and acquires natural gas, natural gas liquids (NGLs) and oil gathering systems and other midstream energy assets. The Company is focused on natural gas and NGL gathering. The Company provides its midstream services to Chesapeake Energy Corporation (Chesapeake), Total E&P USA, Inc. (Total), Mitsui & Co. (Mitsui), Anadarko Petroleum Corporation (Anadarko), Statoil ASA (Statoil) and other producers under long-term, fixed-fee contracts. On December 20, 2012, the Company acquired from Chesapeake Midstream Development, L.P. (CMD), a wholly owned subsidiary of Chesapeake, and certain of CMD's affiliates, 100% of interests in Chesapeake Midstream Operating, L.L.C. (CMO). As a result of the CMO Acquisition, the Partnership owns certain midstream assets in the Eagle Ford, Utica and Niobrara regions. The CMO Acquisition also extended the Company's assets and operations in the Haynesville, Marcellus and Mid-Continent regions.
The Company operates assets in Barnett Shale region in north-central Texas; Eagle Ford Shale region in South Texas; Haynesville Shale region in northwest Louisiana; Marcellus Shale region in Pennsylvania and West Virginia; Niobrara Shale region in eastern Wyoming; Utica Shale region in eastern Ohio, and Mid-Continent region, which includes the Anadarko, Arkoma, Delaware and Permian Basins. The Company's gathering systems collect natural gas and NGLs from unconventional plays. The Company generates its revenues through long-term, fixed-fee gas gathering, treating and compression contracts and through processing contracts.
Barnett Shale Region
The Company's gathering systems in its Barnett Shale region are located in Tarrant, Johnson and Dallas counties in Texas in the Core and Tier 1 areas of the Barnett Shale and consist of 25 interconnected gathering systems and 850 miles of pipeline. During the year! ended December 31, 2012, average throughput on the Company's Barnett Shale gathering system was 1.195 billion cubic feet per day. The Company connects its gathering systems to receipt points that are either at the individual wellhead or at central receipts points into which production from multiple wells are gathered. The Company's Barnett Shale gathering system is connected to the three downstream transportation pipelines: Atmos Pipeline Texas, Energy Transfer Pipeline Texas and Enterprise Texas Pipeline. Natural gas delivered into Atmos Pipeline Texas pipeline system serves the greater Dallas/Fort Worth metropolitan area and south, east and west Texas markets at the Katy, Carthage and Waha hubs. Natural gas delivered into Energy Transfer Pipeline Texas pipeline system serves the greater Dallas/Fort Worth metropolitan area and southeastern and northeastern the United States markets supplied by the Midcontinent Express Pipeline, Centerpoint CP Expansion Pipeline and Gulf South 42-inch Expansion Pipeline. Natural gas delivered into Enterprise Texas Pipeline pipeline system serves the greater Dallas/Fort Worth metropolitan area and southeastern and northeastern the United States markets supplied by the Gulf Crossing Pipeline.
Eagle Ford Shale Region
The Company's gathering systems in its Eagle Ford Shale region are located in Dimmit, La Salle, Frio, Zavala, McMullen and Webb counties in Texas and consist of 10 gathering systems and 618 miles of pipeline. During 2012, gross throughput for these assets was 0.169 billion cubic feet per day. The Company connects its gathering systems to central receipt points into which production from multiple wells is gathered. The Company's Eagle Ford gathering systems are connected to six downstream transportation pipelines, which include Enterprise, Camino Real, West Texas Gas, Regency Gas Service, Eagle Ford Gathering and Enerfin. The Company processes gas at Yoakum or other Enterprise plants and transports residue to Wharton residue header w! ith conne! ctions to numerous interstate pipelines.
Haynesville Shale Region
The Company's Springridge gas gathering system in the Haynesville Shale region is located in Caddo and DeSoto Parishes, Louisiana, in one of the core areas of the Haynesville Shale and consists of 263 miles of pipeline. During 2012, average throughput on the Company's Springridge gathering system was 0.359 billion cubic feet per day. The Company connects its gathering system to receipt points that are at central receipt points into which production from multiple wells is gathered. The Company's Springridge gathering system is connected to three downstream transportation pipelines: Centerpoint Energy Gas Transmission, ETC Tiger Pipeline and Texas Gas Transmission Pipeline. The Company's Mansfield gas gathering system in the Haynesville Shale region is located in DeSoto and Sabine Parishes, Louisiana, in one of the areas of the Haynesville Shale and, as of December 31, 2012, consist of 304 miles of pipeline. During 2012, average throughput on the Company's Mansfield gathering system was 0.720 billion cubic feet per day. The Company connects its gathering system to receipt points that are at central receipt points into which production from multiple wells is gathered and treated. The Company's Mansfield gathering system is connected to two downstream transportation pipelines: Enterprise Accadian Pipeline and Gulf South Pipeline. Natural gas delivered into Enterprise Accadian pipeline can move to on-system markets in the Midwest and to off-system markets in the Northeast through interconnections with third-party pipelines. Natural gas delivered into Gulf South pipeline can move to on-system markets in the Midwest and to off-system markets in the Northeast through interconnections with third-party pipelines.
Marcellus Shale Region
Through Appalachia Midstream, the Company operates 100% of and own an approximate average 47% interests in 10 gas gathering systems that consist of approximately 5! 49 miles ! of gathering pipeline in the Marcellus Shale region. The Company's volumes in the region are gathered from northern Pennsylvania, southwestern Pennsylvania and the northwestern panhandle of West Virginia, in core areas of the Marcellus Shale. The Company operates these smaller systems in northeast and central West Virginia, southeast Pennsylvania, northwest Maryland, north central Virginia, and south central New York. During 2012, gross throughput for Appalachia Midstream assets was just over 1.8 billion cubic feet per day. The Company's Marcellus gathering systems' delivery points include Caiman Energy, Central New York Oil & Gas, Columbia Gas Transmission, MarkWest, NiSource Midstream, PVR and Tennessee Gas Pipeline. Natural gas is delivered into a 16-inch pipeline and delivered to the Caiman Energy Fort Beeler processing plant where the liquids are extracted from the gas stream. The natural gas is then delivered into the TETCo interstate pipeline for ultimate delivery to the Northeast region of the United States. Natural gas delivered into Central New York Oil & Gas 30-inch diameter pipeline can be delivered to Stagecoach Storage, Millennium Pipeline, or Tennessee Gas Pipeline's Line 300. In Columbia Gas Transmission lean natural gas is delivered into two 36-inch interstate pipelines for delivery to the Mid-Atlantic and Northeast regions of the United States. Natural gas is delivered into a MarkWest pipeline for delivery to the MarkWest Houston processing plant where the liquids are extracted from the gas stream. In NiSource Midstream natural gas is delivered into a 20-inch diameter pipeline and delivered to the MarkWest Majorsville processing plant where the liquids are extracted from the rich gas stream. In PVR natural gas is delivered into the 24-inch diameter Wyoming pipeline and the Hirkey Compressor Station. In Tennessee Gas Pipeline natural gas is delivered into this looped 30-inch diameter pipeline (TGP Line 300) at three different locations can be received in the Northeast at points along th! e 300 Lin! e path, interconnections with other pipelines in northern New Jersey, as well as an existing delivery point in White Plains, New York.
Niobrara Shale Region
The Company's gathering systems in the Niobrara Shale region are located in Converse County, Wyoming and consist of two interconnected gathering systems and 79 miles of pipeline. During 2012, average throughput in the Company's Niobrara Shale region was 0.013 billion cubic feet per day. The Company connects its gathering systems to receipt points,which are either at the individual wellhead or at central receipts points into which production from multiple wells are gathered. The Company's Niobrara gathering systems are connected to two downstream transportation pipelines: Tallgrass/Douglas Pipeline and North Finn/DCP Inlet Pipeline. Natural gas delivered into Tallgrass/Douglas pipeline is sent to the Tallgrass processing facility; after processing, natural gas is delivered to Cheyenne Hub, Rockies Express Pipeline, or Trailblazer Pipeline through Tallgrass Interstate Gas Transmission.
Utica Shale Region
The Company's gathering systems in the Utica Shale region are located in northeast Ohio and consist of 67 miles of pipeline. The Company's Utica gathering systems are connected to two downstream transportation pipelines: Dominion East Ohio (Blue Racer) and Dominion Transmission, Inc.
Mid-Continent Region
The Company's Mid-Continent gathering systems extend across portions of Oklahoma, Texas, Arkansas and Kansas. Included in the Company's Mid-Continent region are three treating facilities located in Beckham and Grady Counties, Oklahoma, and Reeves County, Texas, which are designed to remove contaminants from the natural gas stream.
Anadarko Basin and Northwest Oklahoma
The Company's assets within the Anadarko Basin and Northwest Oklahoma are located in northwestern Oklahoma and the northeastern portion of the Texas Panhandle and consist of appro! ximately ! 1,578 miles of pipeline. During 2012, the Company's Anadarko Basin and Northwest Oklahoma region gathering systems had an average throughput of 0.457 billion cubic feet per day. Within the Anadarko Basin and Northwest Oklahoma, the Company is focused on servicing Chesapeake's production from the Colony Granite Wash, Texas Panhandle Granite Wash and Mississippi Lime plays. Natural gas production from these areas of the Anadarko Basin and Northwest Oklahoma contains NGLs. In addition, the Company operates an amine treater with sulfur removal capabilities at its Mayfield facility in Beckham County, Oklahoma. The Company's Mayfield gathering and treating system gathers Deep Springer natural gas production and treats the natural gas to remove carbon dioxide and hydrogen sulfide to meet the specifications of downstream transportation pipelines.
The Company's Anadarko Basin and Northwest Oklahoma systems are connected to a transportation pipelines transporting natural gas out of the region, including pipelines owned by Enbridge and Atlas Pipelines, as well as local market pipelines such as those owned by Enogex. These pipelines provide access to Midwest and northeastern the United States markets, as well as intrastate markets.
Permian Basin
The Company's Permian Basin assets are located in west Texas and consist of approximately 358 miles of pipeline across the Permian and Delaware basins. During 2012, average throughput on the Company's gathering systems was 0.076 billion cubic feet per day. The Company's Permian Basin gathering systems are connected to pipelines in the area owned by Southern Union, Enterprise, West Texas Gas, CDP Midstream and Regency. Natural gas delivered into these transportation pipelines is re-delivered into the Waha hub and El Paso Gas Transmission. The Waha hub serves the Texas intrastate electric power plants and heating market, as well as the Houston Ship Channel chemical and refining markets. El Paso Gas Transmission serves western the United ! States ma! rkets.
Other Mid-Continent Regions
The Company's other Mid-Continent region assets consist of systems in the Ardmore Basin in Oklahoma, the Arkoma Basin in eastern Oklahoma and western Arkansas and the East Texas and Gulf Coast regions of Texas. The other Mid-Continent assets include approximately 648 miles of pipeline. These gathering systems are localized systems gathering specific production for re-delivery into established pipeline markets. During 2012, average throughput on these gathering systems was 0.031 billion cubic feet per day.
The Company competes with Energy Transfer Partners, Crosstex Energy, Crestwood Midstream Partners, Freedom Pipeline, Peregrine Pipeline, XTO Energy, EOG Resources, DFW Mid-Stream, Enbridge Energy Partners, DCP Midstream, Enterprise Products Partners Inc., Regency Energy Partners, Texstar Midstream Operating, West Texas Gas Inc., TGGT Holdings, Kinderhawk Field Services, CenterPoint Field Services, Williams Partners, Penn Virginia Resource Partners, Caiman Energy, MarkWest Energy Partners, Kinder Morgan, Dominion Transmission (Blue Racer), Enogex and Atlas Pipeline Partners.
Advisors' Opinion: - [By Robert Rapier]
That�� the neat trick�Williams�(NYSE: WMB) pulled off today in converting its equity investment in�Access Midstream Partners�(NYSE: ACMP) into full control that will allow it to use ACMP�� surplus �cash flow to offset the deficit at its fully sponsored�Williams Partners�(NYSE: WPZ) MLP, which is to be folded into Access. Williams shareholders get stepped up dividend growth and strategic control of valuable assets.
- [By Adam Galas]
After Williams Companies changed the terms of its merger between Williams Partners and Access Midstream Partners (NYSE: ACMP ) , I recommended that income investors consider both Williams Companies and Access Midstream for their diversified high-yield portfolios, especially since share prices have slumped thanks to oil prices' worst collapse since the financial crisis.�
- [By Robert Rapier]
Access Midstream Partners (NYSE: ACMP) is the successor to Chesapeake Midstream, after it bought Chesapeake Energy’s (NYSE: CHK) midstream assets. At the same time Williams (NYSE: WMB) acquired a 50 percent stake in Access Midstream’s general partner from the master limited partnership’s private equity sponsor. ACMP is now one of the largest midstream companies in the US with gathering pipelines and facilities in the Barnett, Eagle Ford, Haynesville, Marcellus, Niobrara and Utica shales, and elsewhere in the Mid-Continent.
- [By Marc Bastow]
Natural gas and gas liquids owner and operator Access Midstream Partners (ACMP) raised its quarterly distribution 23.5% to 55.5 cents per unit for its Common and Class C units, payable on Feb. 14 to unit holders of record as of Feb. 7.
ACMP Dividend Yield: 3.96%
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