MLP January 2013 Update
- Present domestic oil production around 6 million barrels a day projected to go over 9 million by 2020
- Present domestic natural gas production 65 billion cubic feet per day projected to go over 75 by 2020
- Natural Gas midstream capex investments in the US estimated at $205 billion over next 25 years
- $46 additional billions estimated for NGL and oil pipes investments
- Some projected crude oil production increases form 2011 to 2016-2018:
- Eagle Ford: 600%
- Bakken: 150%
- Rockies: 75%
- Expected MLP IPOs in 2013: 14
- Current Yields:
- Cushing 30 MLP Index: 6.7%
- Alerian Index: 5.9%
- MLP Spreads:
- Versus REITS: approx 300 bps (one standard deviation above average - positive)
- Versus BBB: approx 280 bps (just above one standard deviation over average - positive)
- Versus 10 Year US Treasuries: approx. 400 bps (above historical average - positive)
- Current Price to Distributable Cash Flow: 9.59 (above historical average of 8.5x – negative)