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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: White Bear who wrote (25027)	10/16/2006 10:30:34 PM
From: E_K_S	Read Replies (1) \| Respond to of 78753

Hi Thanksalot - That's interesting. The key is that eventually all of the operator's expenses are recovered and a "fair" return is provided to the partnership for their capital invested (TCLP: ROA 7.16%; ROE 16.23%). Their gross revenue is calculated based on the quantity of gas delivered, overall demand (i.e. growth in usage) and the applicable interstate rate fee charged per unit delivered. I think the long term demand for natural gas will be higher as it is plentiful (U.S. reserves are large), clean burning and relatively priced compared to oil. This company was mentioned on this thread and looks like it might provide good value. TCLP (TC Pipelines LP) finance.yahoo.com TC Pipelines, LP and its subsidiaries engage in the acquisition and management of pipelines in the United States. It owns a 30% general partner interest in Northern Border Pipeline Company, which owns 1,249-mile interstate pipeline system that transports natural gas from the Montana-Saskatchewan border to markets in the Midwestern. The company also owns 49% general partner interest in Tuscarora Gas Transmission Company that owns a 240-mile interstate pipeline system, which transports natural gas from Oregon to northern Nevada. TC PipeLines GP, Inc. serves as the general partner of the partnership. TC PipeLines was founded in 1998 and is based in Westborough, Massachusetts. I am not sure if their dividend is qualified or non-qualified. If it is deemed qualified then on any pull back this might be a good one to own. They currently trade with a PE at 12, pay a 7% dividend and generate positive free flow cash flow. They do carry $18/share in debt but according to the information you posted, this borrowed money is recoverable through their interstate rate fees. The company has made over $600 million in longterm investments in June'06 so it appears that management is making the necessary investments for the future. EKS