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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Ed Ajootian who wrote (96554)	2/8/2008 8:17:11 AM
From: Schnullie	Respond to of 206201

Currently paying 6.3% but 12 months of flat PPS...owned it for years Enterprise Products Partners (NYSE: EPD) is among the nation's largest pipeline operators. The firm owns nearly 900 miles of crude oil pipelines and 33,000 miles of natural gas, natural gas liquids [NGL], and petrochemical pipelines. Other assets include several gas import terminals and storage facilities, two dozen processing plants, and a number of fractionation facilities -- which separate raw streams of NGL into various products like ethane and propane. The company also has a network of gathering and processing facilities concentrated along the Gulf Coast. Following a series of acquisitions, Enterprise is now one of the nation's largest publicly-traded energy partnerships. As a master limited partnership [MLP], the company is generally exempt from federal income taxes, provided it distributes the lion's share of its cash flows to shareholders (technically referred to as unitholders). This special status allows MLPs to shell out generous payments, although these distributions typically don't qualify for the reduced 15% dividend tax rate. As opposed to the "upstream" business of exploration and production, Enterprise is a "midstream" energy player -- a sector coveted for its steady cash generation potential. Much of Enterprise's diverse revenue stream comes from pipeline charges, which are influenced more by volume flow than by volatile commodity prices. And the firm's assets are focused in the nation's most reliable supply basins -- those representing approximately 90% of the production in the lower 48 states. Enterprise's network transports 1.8 million barrels of NGL and 7.9 trillion BTUs of natural gas every day. All of this has translated into a steadily rising stream of distributable cash flows. Following record financial results in 2006, the company has generated cash flows in excess of $730 million through the first three quarters of 2007. As a result, management just boosted quarterly distributions to $0.50 per unit, or $2.00 annually. That marks the 14th consecutive quarterly increase, and overall the payout has surged by +122% over the past decade. And there is plenty more where that came from. Natural gas consumption isn't slowing down -- management is expecting the rising volume of gas flowing through its pipelines and facilities to lead to heavier cash flows down the line. Increased deepwater drilling and leasing activity in the Gulf of Mexico also bodes well. Most importantly, the company is also wrapping up $2.1 billion worth of expansion projects that are just now coming online and could be key growth drivers going forward. Much like a toll road, Enterprise can now sit back and collect a steady stream of revenues as natural gas flows from producers into the homes of millions of Americans. From the beginning of 1999 through the end of October last year, EPD delivered a jaw-dropping total return of more than +500% -- versus just +45% for the S&P 500. However, with a sizeable yield of 6.4% and a good long-term outlook, the units could continue upwards for the next couple of years.

To: Ed Ajootian who wrote (96554)	2/8/2008 11:25:32 AM
From: JimisJim	Respond to of 206201

Ed: good point... <With any amount of luck this boredom will continue ad infinitum!> It would be very bullish for the energy sector for oil to stay in the 80-90 range all year. The companies in energy with big capex spending care less about the exact price of oil than they do price stability for budgetary planning -- as long as the price stability is above whatever level is needed for them to operate profitably... they get nervous and conservative when there are a lot of sudden spikes and plunges... just like the rest of us, I guess. Jim