• Energy and Income Advisor
  • Conrads Utility Investor
  • Capitalist Times
  • Twitter
  • Seeking Alpha
  • Roger S. Conrad

IPO Analysis: PES Logistics Partners LP (NYSE: PESL)

By Roger S. Conrad on Nov. 18, 2014

PES Logistics Partners LP (NYSE: PESL) owns a 45 percent interest in North Yard Logistics, an operating company whose cornerstone asset is a rail unloading terminal that can accommodate up to three 120-railcar unit trains per day.

This facility supplies crude oil to its sponsor’s Philadelphia refining complex—the largest on the East Coast—under a 10-year contract that includes inflation escalators and minimum volume commitments.

Philadelphia Energy Solutions, which owns and operates the refinery, is a 70-30 joint venture between private-equity giant The Carlyle Group (NYSE: CG) and Sunoco, which is now a part of Energy Transfer Partners LP (NYSE: ETP)

Rail has emerged as an important link between producing basins and end-markets that can’t be reached via existing pipelines. In fact, this mode of transportation has single-handedly revived the profitability of East Coast refineries by supplying them with discounted crude oil produced in North Dakota’s Bakken Shale.

PES Logistics Partners also has the right to purchase a rail terminal that handles natural gas liquids (NGL). This facility, which is expected to come onstream in the fourth quarter, will take advantage of surging production from the nearby Marcellus Shale that has overwhelmed the region’s existing transportation capacity and trades at a discount to other regions.

Energy & Income Advisor

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.

Subscribe today to receive a sample issue of EIA
  • Live Chat with

    Elliott and Roger on Feb. 28, 2017

  • Portfolios & Ratings

    • Model Portfolios

      Balanced portfolios of energy stocks for aggressive and conservative investors.

    • Coverage Universe

      Our take on more than 50 energy-related equities, from upstream to downstream and everything in between.

    • MLP Ratings

      Our assessment of every energy-related master limited partnership.

    • International Coverage Universe

      Roger Conrad’s coverage of more than 70 dividend-paying energy names.

    Experts

    • Roger S. Conrad

      Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor

    • Elliott H. Gue

      Founder and Chief Analyst: Capitalist Times and Energy & Income Advisor

    • Peter Staas

      Managing Editor: Capitalist Times and Energy & Income Advisor