Hess Corp (NYSE: HES) last month closed the sale of $860 million in liquids terminals and related assets to MLP Portfolio holding Buckeye Partners LP (NYSE: BPL) as part of the company’s effort to monetize its midstream assets and unlock shareholder value.
The proposed initial public offering of Hess Midstream Partners LP (NYSE: HESM) will monetize Hess Corp’s processing, transportation and terminal assets in North Dakota’s Bakken Shale, a prolific oil-producing play.
The MLP’s initial assets will include a 30 percent economic interest in the Tioga gas-processing plant, a 50 percent interest in an associated rail terminal that transports crude oil and natural gas liquids (NGL) and nine 104-railcar unit trains.
An agreement to supply Nova Chemicals’ petrochemical operations with ethane produced at Hess Midstream Partners’ Tioga processing plant should also bolster Hess Corp’s price realizations relative to its peers.
Hess Midstream Partners will also own a 50 percent stake in the Ramberg truck facility that receives crude oil for shipment via pipeline to the Tioga rail terminal and 100 percent of a propane storage facility in Mentor, Minnesota.
Through January 2024, the partnership will have the right of first refusal to acquire the remaining stakes in the aforementioned assets and Hess Corp’s oil- and gas-gathering pipeline systems in the Bakken Shale.
Your complete guide to energy investing, from growth stocks to high-yielders.
In October 2012, renowned energy expert Elliott Gue launched the Energy & Income Advisor, a twice-monthly investment advisory that's dedicated to unearthing the most profitable opportunities in the sector, from growth stocks to high-yielding utilities, royalty trusts and master limited partnerships.
Elliott and Roger on Dec. 21, 2017
Balanced portfolios of energy stocks for aggressive and conservative investors.
Our take on more than 50 energy-related equities, from upstream to downstream and everything in between.
Our assessment of every energy-related master limited partnership.
Roger Conrad’s coverage of more than 70 dividend-paying energy names.