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Company Links |
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Business Environment |
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The midstream natural gas industry is the link between exploration and production of natural gas and the delivery of its components to end-use markets, and consists of the gathering, compressing, treating, processing, transportation and selling of natural gas, and the transportation and selling of NGLs.
Natural gas is a critical component of energy consumption in the United States. According to the Energy Information Administration, or the EIA, total annual domestic consumption of natural gas is expected to increase from approximately 22.1 trillion cubic feet, or Tcf, in 2004 to approximately 25.4 Tcf in 2010, representing an average annual growth rate of over 2.3% per year. The industrial and electricity generation sectors are the largest users of natural gas in the United States. During the last three years, these sectors accounted for approximately 61% of the total natural gas consumed in the United States.
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Company Strategy |
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The Company is a growth-oriented Delaware limited partnership engaged in the business of gathering, compressing, treating, processing, transporting and selling natural gas and fractionating and transporting natural gas liquids, or NGLs. |
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Product/Services Portfolio |
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The Company’s assets are strategically located in three significant natural gas producing regions in the Texas Panhandle, southeast Texas and Louisiana.
The Company’s Texas Panhandle operations cover ten counties in Texas and one county in Oklahoma, consisting of its East Panhandle System and its West Panhandle System. The facilities that comprise the Company’s East Panhandle System are primarily located in Wheeler, Hemphill and Roberts Counties in the eastern Texas Panhandle and consist of approximately 769 miles of natural gas gathering pipelines, ranging from two inches to 12 inches in diameter, with 33,726 horsepower of associated pipeline compression; two active natural gas processing plants with an aggregate capacity of 65 MMcf/d; and two natural gas treating facilities with an aggregate capacity of 75 MMcf/d.
In addition, the Company recently purchased Midstream Gas Services, L.P., which consists of facilities located in Roberts County within its East Panhandle System. The facilities consist of approximately four miles of natural gas gathering pipelines with associated pipeline compression and an active natural gas processing plant with aggregate capacity of 25 MMcf/d.
The facilities that comprise the Company’s West Panhandle System are primarily located in Moore, Potter, Hutchinson, Carson, Roberts, Gray, Wheeler and Collingsworth Counties in the western Texas Panhandle and consist of approximately 2,556 miles of natural gas gathering pipelines, ranging from two inches to 12 inches in diameter, with 81,178 horsepower of associated pipeline compression; four active natural gas processing plants with an aggregate capacity of 101 MMcf/d; three natural gas treating facilities with an aggregate capacity of 65 MMcf/d; a propane fractionation facility with capacity of 1,000 Bbls/d; and a condensate collection facility.
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Investment Analysis |
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Total operating revenues increased $61.4 million, or 18.3%, to $396.9 million for the eleven months ended November 30, 2005 from $335.5 million for the year ended December 31, 2004.
Purchases of natural gas and NGLs increased $53.1 million, or 20.1%, to $317.0 million as of November 30, 2005 from $263.8 million as of December 31, 2004.
Gross margin increased $8.3 million, or 11.6%, to $80.0 million as of November 30, 2005 from $71.7 million as of December 31, 2004.
Operating and maintenance expense increased $0.1 million, or 0.3%, to $27.5 million as of November 30, 2005 from $27.4 million as of December 31, 2004.
Net interest income increased $0.2 million, or 33.1%, to $0.9 million as of November 30, 2005 from $0.6 million as of December 31, 2004 due to higher cash generation during 2005.
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Income Data (Thousand $ Except EPS) |
| Year |
Revenues |
Costs |
Oper Income |
Taxes |
Net Income |
EPS |
| 2003
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0.00 |
144,045 |
-144,045 |
0.00 |
388,502 |
0.00 |
| 2004
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10,636,169 |
11,870,533 |
-1,234,364 |
0.00 |
20,981,981 |
0.00 |
| 2005
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73,690,152 |
67,080,030 |
6,610,122 |
0.00 |
2,749,796 |
0.00 |
| 2006
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211,204,281 |
229,258,970 |
-18,054,689 |
507,855 |
-24,485,774 |
0.00 |
| *As of period ended June 30, 2006
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Balance Sheet Data
(Thousand $) |
Year |
Cash |
Acct Recv. |
Inventory |
Total Cur Assets |
Total Cur Liability |
PPE |
Total Assets |
LT Debt |
SH Equity |
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2004 |
8,235,336 |
149,893 |
0.00 |
8,438,314 |
361,053 |
19,563,742 |
28,016,536 |
0.00 |
28,016,536 |
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2005 |
19,371,706 |
43,557,479 |
0.00 |
86,036,196 |
56,851,977 |
441,587,868 |
700,659,062 |
404,600,000 |
700,659,062 |
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2006 |
7,170,377 |
42,536,221 |
0.00 |
57,717,430 |
40,939,166 |
532,937,696 |
769,121,497 |
395,000,000 |
769,121,497 |
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*As of period ended June 30, 2006
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| Cash
Flow Summary
(Thousand $) |
Year |
Net Cash-Ops |
Net Cash-Inv |
Net Cash-Fin |
Net Change |
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2003 |
32,219,184 |
-5,203,298 |
-27,015,886 |
0.00 |
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2004 |
41,813,016 |
-5,567,410 |
-36,245,606 |
0.00 |
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2005 |
47,602,734 |
-6,707,606 |
-40,895,128 |
0.00 |
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*Period ended November 30, 2005
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- Value Gap 
- Short-Term Growth
- Long-Term Growth 
- Long-Term Value 