We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
SemGroup, DCP Midstream Commence Open Season for NGL Pipeline
Read MoreHide Full Article
SemGroup Corporation recently announced a binding open season along with DCP Midstream, LP for the White Cliffs Pipeline and Southern Hills Pipeline, which will provide natural gas liquids (NGL) shipping services. The project is expected to connect Weld County, CO and Mont Belvieu, TX.
SemGroup plans to transform part of White Cliffs Pipeline system to NGL service, which will help the shippers from the DJ Basin to reach Cushing, OK. DCP Midstream will help the project by constructing a 25-mile long pipeline in the prolific basin, which will be connected to the White Cliffs. SemGroup will further extend the White Cliffs pipeline by 12 miles to connect it with the Southern Hills Pipeline. The project is supported by 10-year commitment from DCP Midstream and its unit, DCP Southern Hills Pipeline, LLC.
Notably, holding 51% interest, SemGroup is the owner and operator of the White Cliffs pipeline, while DCP Midstream owns 66% stake in the Southern Hills Pipeline. The project is anticipated to come online in 2019’s fourth quarter.
The binding open season will render potential NGL transporters in the DJ Basin an opportunity to score discounted rates against long-term volume commitments. The project is also expected to provide them open access to the markets in Texas Gulf Coast. The open season will be concluded on Jun 25.
Earlier, SemGroup stated that the cost of the project was estimated to be in the range of $60-$66 million and the company will pay 51% of it. Apart from a new source of revenue, the move is expected to diversify SemGroup’s portfolio. It will also elevate White Cliffs’ potential beyond crude while lowering its risk-profile. The project is also in line with DCP Midstream’s strategy to expand its value chains.
Additionally, DCP Midstream has two more projects that are expected to come online in 2019: Front Range and Texas Express expansion.
Price Performance
Tulsa, OK-based SemGroup has lost 26.6% of its value in the past year while Denver, CO-based DCP Midstream has gained 13.3% against 12.3% fall of their industry.
Zacks Rank and Stocks to Consider
Currently, both SemGroup and DCP Midstream have a Zacks Rank #3 (Hold).
Houston, TX-based Nine Energy Service is an onshore service provider. For 2018, its bottom line is likely to be up 181.7%. In the last reported quarter, the company delivered a positive earnings surprise of 28.6%.
Brentwood, TN-based Delek is a downstream energy company. The company’s top line for 2018 is anticipated to improve 39.2% year over year, while its bottom line is expected to increase 194.4%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
SemGroup, DCP Midstream Commence Open Season for NGL Pipeline
SemGroup Corporation recently announced a binding open season along with DCP Midstream, LP for the White Cliffs Pipeline and Southern Hills Pipeline, which will provide natural gas liquids (NGL) shipping services. The project is expected to connect Weld County, CO and Mont Belvieu, TX.
SemGroup plans to transform part of White Cliffs Pipeline system to NGL service, which will help the shippers from the DJ Basin to reach Cushing, OK. DCP Midstream will help the project by constructing a 25-mile long pipeline in the prolific basin, which will be connected to the White Cliffs. SemGroup will further extend the White Cliffs pipeline by 12 miles to connect it with the Southern Hills Pipeline. The project is supported by 10-year commitment from DCP Midstream and its unit, DCP Southern Hills Pipeline, LLC.
Notably, holding 51% interest, SemGroup is the owner and operator of the White Cliffs pipeline, while DCP Midstream owns 66% stake in the Southern Hills Pipeline. The project is anticipated to come online in 2019’s fourth quarter.
The binding open season will render potential NGL transporters in the DJ Basin an opportunity to score discounted rates against long-term volume commitments. The project is also expected to provide them open access to the markets in Texas Gulf Coast. The open season will be concluded on Jun 25.
Earlier, SemGroup stated that the cost of the project was estimated to be in the range of $60-$66 million and the company will pay 51% of it. Apart from a new source of revenue, the move is expected to diversify SemGroup’s portfolio. It will also elevate White Cliffs’ potential beyond crude while lowering its risk-profile. The project is also in line with DCP Midstream’s strategy to expand its value chains.
Additionally, DCP Midstream has two more projects that are expected to come online in 2019: Front Range and Texas Express expansion.
Price Performance
Tulsa, OK-based SemGroup has lost 26.6% of its value in the past year while Denver, CO-based DCP Midstream has gained 13.3% against 12.3% fall of their industry.
Zacks Rank and Stocks to Consider
Currently, both SemGroup and DCP Midstream have a Zacks Rank #3 (Hold).
Investors interested in the Energy sector can opt for some better-ranked stocks in the same space like Nine Energy Service, Inc. (NINE - Free Report) and Delek US Holdings, Inc. (DK - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Houston, TX-based Nine Energy Service is an onshore service provider. For 2018, its bottom line is likely to be up 181.7%. In the last reported quarter, the company delivered a positive earnings surprise of 28.6%.
Brentwood, TN-based Delek is a downstream energy company. The company’s top line for 2018 is anticipated to improve 39.2% year over year, while its bottom line is expected to increase 194.4%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>