Tuesday, October 22, 2013

EQT Midstream: A Small Marcellus Focused MLP To Bet On

EQT Midstream is poised for significant growth in the coming years due to drop-downs from EQT Corp, increasing investments in transmission, storage and gathering systems and its ability to capitalize on the increasing Marcellus production.  

EQT Midstream Partners (EQM) is the midstream arm of one of the leading natural gas producers at the Appalachian Basin EQT Corporation (EQT). EQT Midstream owns, operates and develops midstream assets in the region. EQT Midstream's primary assets are the Equitrans Transmission and Storage System and the Equitrans Gathering System. The business provides its services to EQT Corp as well as other companies. The partnership was formed by EQT Corp in June-2012. EQT is the general partner and owns 44.6% of the equity interest (2% GP and 42.6% LP interest).

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EQT Midstream's primary assets and its association with a leading player at Appalachian Basin makes it a premier midstream operator in the region. The firm is in a good position to capitalize on the growing demand of Marcellus' supply.

Equitrans Transmission and Storage System is the life and blood of EQT Midstream. It includes 700-mile FERC-regulated interstate pipeline system which connects with other pipelines and distribution companies. By the end of 2012, the system had a throughput capacity of 1.4 TBtu/day, which has now increased to 2.1 TBtu/day. In 2012, the system's throughput rose by 53% from a year ago to 606 BBtu/day. Equitrans Gathering System includes 2000 miles of FERC regulated low-pressure gathering lines that connects with other transmission and storage systems.

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The business has typically earned more than 85% of its revenues from Equitrans Transmission and Storage System and more than 12% from Equitrans Gathering System.

Quarterly Results and outlook

In its last … read full article with figures at Seeking Alpha