EUROPE’S ENERGY CRISIS IS KEEPING ENERGY PRICES AND INFLATION HIGH
America leads the world in oil and gas production. We believe midstream energy infrastructure offers predictable cash flows to investors..
Pipeline Stocks Get That Warm Feeling Again
A common concern of both existing and potential investors in energy infrastructure is the relatively high volatility of recent years. Many recall the “toll-model” of pipelines that was the basis of their appeal prior to 2014. As we have often written, the Shale Revolution broke the MLP model, as companies with very high payout ratios […]
Fanatics Protest From a Steel Cell
You might think that using a crane to place steel boxes so as to block all the entrances to a global energy corporation might attract some attention before completed. Nonetheless, Greenpeace successfully demonstrated a gap in business continuity planning, just hours before BP’s annual general meeting. Even at 3am, BP’s global headquarters should have had […]
Better Odds With Pipelines
New pipelines are becoming harder to build. New York recently blocked a natural gas pipeline planned by Williams Companies (WMB) because of environmental concerns, although WMB plans to reapply. Canada is becoming a more difficult and expensive place in which to build (other than in oil-rich Alberta). Enbridge (ENB) went as […]
Why Keeping Up With Inflation Isn’t Enough
Cher wanted to turn back time to regain love lost. But economists are always turning back time to adjust prices for inflation, to calculate a measure in today’s dollars. This is to provide a relative price, comparable to current purchases. Although mathematically correct, applied over decades or more it produces a misleading picture of what […]
Why Energy Transfer Can’t Get Respect
If Energy Transfer (ET) was a private company contemplating an IPO, the 15% Distributable Cash Flow (DCF) yield indicated by their underwriters would draw laughter. The bankers would be ushered out of the conference room. Yet that is the lowly valuation investors assign to perhaps the least loved pipeline company in a sector that investors […]