Best Transportation Stocks For 2014

FedEx Corporation (NYSE:FDX) plans to release its financial results for the third quarter of fiscal year 2014 on Wednesday, March 19, 2014 before the market opens The Company plans to host a webcast at 8:30 a.m. ET the same day to review the results and management's outlook.

Wall Street anticipates that the delivery company will earn $1.51 per share for the quarter, which is $0.28 more than last year's profit of $1.23 per share. iStock expects FDX �to miss Wall Street's consensus number. The iEstimate is $1.47, a bearish surprise of $0.04; although, we could be lowballing the Dow Transportation Index member's actual results.

[Related -FedEx Corporation (FDX): George Soros And John Paulson Own This Stock. Should You?]

Along with EPS rising an expected 22.76%, sales are forecasted to increase 4.6%. The consensus revenue estimate for Q3 is $11.46 billion, up from last year's $10.95 billion.

Best Defensive Companies To Invest In Right Now: Boardwalk Pipeline Partners LP (BWP)

Boardwalk Pipeline Partners, LP is a limited partnership company. The Company owns and operates three interstate natural gas pipeline systems including integrated storage facilities. Its business is conducted by its primary subsidiary, Boardwalk Pipelines, LP (Boardwalk Pipelines) and its subsidiaries, Gulf Crossing Pipeline Company LLC (Gulf Crossing), Gulf South Pipeline Company, LP (Gulf South) and Texas Gas Transmission, LLC (Texas Gas) (together, the operating subsidiaries), which consist of integrated natural gas pipeline and storage systems. During the year ended December 31, 2011, it formed Boardwalk Midstream, LP (Midstream), and its operating subsidiary, Boardwalk Field Services, LLC (Field Services), which is engaged in the natural gas gathering and processing business. In December 2011, Boardwalk HP Storage Company, LLC (HP Storage), a joint venture between Boardwalk Pipelines and Boardwalk Pipelines Holding Corp. (BPHC) acquired Petal Gas Storage, L.L.C. (Petal), Hattiesburg Gas Storage Company (Hattiesburg). In December 2011, it acquired a 20% equity interest in HP Storage.

The Company�� pipeline systems originate in the Gulf Coast region, Oklahoma and Arkansas and extend north and east to the midwestern states of Tennessee, Kentucky, Illinois, Indiana and Ohio. It serves a mix of customers, including producers, local distribution companies (LDCs), marketers, electric power generators, direct industrial users and interstate and intrastate pipelines. The Company provides a portion of its pipeline transportation and storage services, through firm contracts, under which the Company�� customers pay monthly capacity reservation charges. Other charges are based on actual utilization of the capacity under firm contracts and contracts for interruptible services. During 2011, approximately 82% of its revenues were derived from capacity reservation charges under firm contracts; approximately 14% of its revenues were derived from charges-based on actual utilization under firm contr! acts, and approximately 4% of its revenues were derived from interruptible transportation, interruptible storage, parking and lending (PAL) and other services. Its expansion projects include South Texas Eagle Ford Expansionand Marcellus Gathering System and HP Storage.

Pipeline and Storage Systems

The Company�� operating subsidiaries own and operate approximately 14,200 miles of pipelines, directly serving customers in twelve states and indirectly serving customers throughout the northeastern and southeastern United States through numerous interconnections with unaffiliated pipelines. In 2011, its pipeline systems transported approximately 2.7 trillion cubic feet of gas. Average daily throughput on its pipeline systems during 2011 was approximately 7.3 billion cubic feet. Its natural gas storage facilities are comprised of eleven underground storage fields located in four states with aggregate working gas capacity of approximately 167.0 billion cubic feet. the Company operates the assets of HP Storage on behalf of the joint venture.

The principal sources of supply for our pipeline systems are regional supply hubs and market centers located in the Gulf Coast region, including offshore Louisiana, the Perryville, Louisiana area, the Henry Hub in Louisiana and the Carthage, Texas area. Its pipelines in the Carthage, Texas area provide access to natural gas supplies from the Bossier Sands, Barnett Shale, Haynesville Shale and other gas producing regions in eastern Texas and northern Louisiana. The Henry Hub serves as the designated delivery point for natural gas futures contracts traded on the New York Mercantile Exchange. Its pipeline systems also have access to unconventional mid-continent supplies, such as the Woodford Shale in southeastern Oklahoma and the Fayetteville Shale in Arkansas. The Company also accesses the Eagle Ford Shale in southern Texas; wellhead supplies in northern and southern Louisiana and Mississippi; and Canadian natural gas through an unaffil! iated pip! eline interconnect at Whitesville, Kentucky.

Gulf Crossing

The Company�� Gulf Crossing pipeline system originates near Sherman, Texas, and proceeds to the Perryville, Louisiana area. The market areas are in the Midwest, Northeast, Southeast and Florida through interconnections with Gulf South, Texas Gas and unaffiliated pipelines.

Gulf South

The Company�� Gulf South pipeline system is located along the Gulf Coast in the states of Texas, Louisiana, Mississippi, Alabama and Florida. The on-system markets directly served by the Gulf South system are generally located in eastern Texas, Louisiana, southern Mississippi, southern Alabama, and the Florida Panhandle. These markets include LDCs and municipalities located across the system, including New Orleans, Louisiana; Jackson, Mississippi; Mobile, Alabama; and Pensacola, Florida, and other end-users located across the system, including the Baton Rouge to New Orleans industrial corridor and Lake Charles, Louisiana. Gulf South also has indirect access to off-system markets through numerous interconnections with unaffiliated interstate and intrastate pipelines and storage facilities. These pipeline interconnections provide access to markets throughout the northeastern and southeastern United States.

Gulf South has two natural gas storage facilities. The gas storage facility located in Bistineau, Louisiana, has approximately 78 billion cubic feet of working gas storage capacity from which Gulf South offers firm and interruptible storage service, including no-notice service. Gulf South�� Jackson, Mississippi, gas storage facility has approximately five billion cubic feet of working gas storage capacity, which is used for operational purposes and is not offered for sale to the market.

Texas Gas

The Company�� Texas Gas pipeline system originates in Louisiana, East Texas and Arkansas and runs north and east through Louisiana, Arkansas, Mississippi, Tennessee, K! entucky, ! Indiana, and into Ohio, with smaller diameter lines extending into Illinois. Texas Gas directly serves LDCs, municipalities and power generators in its market area, which encompasses eight states in the South and Midwest and includes the Memphis, Tennessee; Louisville, Kentucky; Cincinnati and Dayton, Ohio, and Evansville and Indianapolis, Indiana metropolitan areas. Texas Gas also has indirect market access to the Northeast through interconnections with unaffiliated pipelines. Texas Gas owns nine natural gas storage fields, of which it owns the majority of the working and base gas. Texas Gas uses this gas to meet the operational requirements of its transportation and storage customers and the requirements of its no-notice service customers.

Field Services

In 2011, the Company formed its Field Services subsidiary and transferred to it approximately 100 miles of gathering and transmission pipeline. In 2012, the Company transferred to Field Services an additional 240 miles of pipeline and two compressor stations. Field Services is developing gathering and processing capabilities in south Texas and Pennsylvania.

Advisors' Opinion:

• [By Robert Rapier]

  The worst performer in the first half was�Oxford Resource Partners�(NYSE: OXF), a coal producer that suspended its distribution more than a year ago and has seen its unit price continue to decline. It is down 31.5 percent in 2014.�Boardwalk Pipeline Partners�(NYSE: BWP) saw the second worst decline in the first half of 2014 after announcing a distribution cut of more than 80 percent. BWP saw its unit price plunge by 46 percent in a single trading session. It has since recovered somewhat, but is down 28.8 percent year-to-date.

Best Transportation Stocks For 2014: Frontline Ltd (FRO)

Frontline Ltd., incorporated on June 12, 1992, is a shipping company. The Company is engaged primarily in the ownership and operation of oil tankers and oil/bulk/ore (OBO) carriers. The Company operates tankers of two sizes: very large crude carriers (VLCCs), which are between 200,000 and 320,000 deadweight tons, and Suezmax tankers, which are vessels between 120,000 and 170,000 deadweight tons. As of December 31, 2010, its tanker and OBO fleet consisted of 73 vessels. The fleet consists of 44 VLCCs, which are either owned or chartered in, 21 Suezmax tankers, which are either owned or chartered in and eight Suezmax OBOs, which are chartered in. The Company also had five VLCC newbuildings and two Suezmax newbuildings on order and three VLCCs under its commercial management. In February 2010, it purchased the VLCC Front Vista from Ship Finance International Limited (Ship Finance). In January 2011, it sold the VLCC Front Shanghai.

The Company operates through subsidiaries and partnerships located in the Bahamas, Bermuda, the Cayman Islands, India, the Isle of Man, Liberia, Norway, the United Kingdom and Singapore. The Company is also engaged in the charter, purchase and sale of vessels. In April 2010, the Company delivered the single hull Suezmax Front Voyager. During the year ended December 31, 2010, six newbuildings were completed. Four Suezmax vessels were delivered: the Northia, on January 5, 2010; the Naticina, on March 9, 2010; the Front Odin, on May 5, 2010, and the Front Njord on August 12, 2010. Two VLCCs were delivered: the Front Cecilie on June 10 and the Front Signe on August 9, 2010. As of December 31, 2010, the Company's newbuilding program consisted of two Suezmax tankers and five VLCCs.

Advisors' Opinion:

• [By Paul Ausick]

  Big Earnings Movers: Hewlett-Packard Co. (NYSE: HPQ) is up 9.1% at $27.37 after beating on both the top and bottom lines last night. 58.com (NYSE: WUBA) is down 10% at $33.56. Frontline Ltd. (NYSE: FRO) is up 16.6% at $2.74.

Best Transportation Stocks For 2014: NuStar GP Holdings LLC (NSH)

NuStar GP Holdings, LLC (NuStar GP Holdings), incorporated on June 06, 2000, conducts operations through its indirect ownership interests in NuStar Energy L.P. (NuStar Energy). NuStar Energy is engaged in the terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. The Company operates in three segments: NuStar Energy�� Storage Segment, NuStar Energy�� Pipeline Segment and NuStar Energy�� Asphalt and Fuels Marketing Segment. On January 1, 2013, NuStar Energy sold the San Antonio Refinery and related assets, which included inventory, a terminal in Elmendorf, Texas and a pipeline connecting the terminal and refinery. On December 13, 2012, NuStar Energy completed its acquisition of the TexStar Crude Oil Assets (as defined below), including 100% of the partnership interest in TexStar Crude Oil Pipeline, LP, from TexStar Midstream Services, LP and certain of its affiliates.

NuStar Energy has terminal and storage facilities in the United States, Canada, Mexico, the Netherlands, including St. Eustatius in the Caribbean, the United Kingdom and Turkey. NuStar Energy L.P.'s asphalt refineries, refined product terminals, petroleum and specialty liquids storage and terminaling operations, and crude oil storage tank facilities are predominantly located on waterways that are easily accessible by barge or vessel. On September 28, 2012, NuStar Energy sold a 50% ownership interest (the Asphalt Sale) in NuStar Asphalt LLC (Asphalt JV), previously a wholly owned subsidiary of NuStar Energy, to an affiliate of Lindsay Goldberg LLC (Lindsay Goldberg), a private investment firm.

Advisors' Opinion:

• [By Robert Rapier]

  NuStar Energy does have a publicly traded general partner in�NuStar GP Holdings�(NYSE: NSH) which went public in 2006. The GP pays a lower dividend at 5.8 percent, but has significantly outperformed the limited partner since it went public:

• [By Robert Rapier]

  But it is important to note that ETE also has interests in Sunoco Logistics Partners (NYSE: SXL) and Regency Energy Partners (NYSE: RGP).

  Finally, consider NuStar Energy (NYSE: NS) and its general partner NuStar GP Holdings (NYSE: NSH). Like ETE, NSH went public in 2006 and has also significantly outperformed its limited partner since:
  
  
  

  The vast majority of partnerships don’t have a publicly-traded GP. But in each of these three cases in which the GP is publicly traded, the GP tends to outperform the LP units on long-term gains, an advantage somewhat offset by the typically higher LP yield.

Best Transportation Stocks For 2014: Golar LNG Partners LP (GMLP)

Golar LNG Partners LP (the Partnership), incorporated on September 24, 2007, is a limited partnership formed as a wholly owned subsidiary of Golar LNG Limited (Golar), an independent owner and operator of floating storage re-gasification units (FSRUs) and liquefied natural gas (LNG) carriers, to own and operate FSRUs and LNG carriers under long-term charters. The vessels in its fleet are chartered to BG Group, Pertamina, Petrobras and Dubai Supply Authority. As of December 31, 2012, Golar owned its 2.0% general partner interest, all of its IDRs and a 49.9% limited partner interest in it. As of December 31, 2012, its fleet consisted of a 100% interest in the Golar Spirit, which is operating under a time charter with Petrobras; a 100% interest in the Golar Winter, which is operating under a time charter with Petrobras; a 100% interest in the Golar Freeze, which is operating under a time charter with Dubai Supply Authority (DUSUP), the purchaser of natural gas in Dubai; a 100% interest in the Methane Princess, which is operating under a time charter with BG Group PLC (BG Group), and a 60% interest in the Golar Mazo, an LNG carrier, which is operating under a time charter with PT Pertamina (Pertamina). In July 2012, Golar sold its interests in the companies that own and operate the floating storage and regasification unit (FSRU) Nusantara Regas Satu to the Company. As of April 30, 2013, the Company has a fleet of four FSRUs and four LNG carriers. In November 2012, the Company acquired from Golar interests in subsidiaries that lease and operate the LNG carrier, the Golar Grand.

FSRU Charters

The Company provides the services of each of the Golar Spirit and the Golar Winter to Petrobras under separate time charter parties (or TCP) and operation and services agreements (OSAs). The TCPs and OSAs are interdependent and when combined have the same effect as the time charters for its LNG carriers. The services of the Golar Freeze are provided to DUSUP under a TCP. The Golar Spirit and ! Golar Winter charters also contained provisions giving Petrobras the option to purchase the vessels from it under certain circumstances.

LNG Carrier Charters

The Company provides the LNG marine transportation services of the Golar Mazo, Methane Princess and the Golar Maria under a time charters with LNG Shipping SpA. A time charter is a contract for the use of the vessel for a fixed period of time at a specified daily rate. Under a time charter, the vessel owner provides crewing and other services related to the vessel�� operation.

The Company competes with Royal Dutch Shell, BP, BG, Malaysian International Shipping Company, National Gas Shipping Company, Qatar Gas Transport Company, Excelerate Energy, Hoegh LNG, Exmar, Teekay LNG and MISC Berhad.

Advisors' Opinion:

• [By Seth Jayson]

  Golar LNG Partners Limited Partnership (Nasdaq: GMLP  ) reported earnings on May 30. Here are the numbers you need to know.

  The 10-second takeaway
  For the quarter ended March 31 (Q1), Golar LNG Partners Limited Partnership met expectations on revenues and crushed expectations on earnings per share.

• [By Roberto Pedone]

  Golar LNG Partners LP (GMLP), a limited partnership, owns and operates floating storage and regasification units and LNG carriers under long-term charters. This stock closed up 3.5% at $32.74 in Monday's trading session.

  Monday's Volume: 432,000
  
  Three-Month Average Volume: 81,559
  
  Volume % Change: 283%

  From a technical perspective, GMLP bounced notably higher here right off its 200-day moving average of $31.79 and back above its 50-day moving average of $32.56 with strong upside volume. This move is quickly pushing shares of GMLP within range of triggering a near-term breakout trade. That trade will hit if GMLP manages to take out Monday's intraday high at $32.96 to some more near-term overhead resistance at $33.15 with high volume.

  Traders should now look for long-biased trades in GMLP as long as it's trending above its 200-day at $31.79 and then once it sustains a move or close above those breakout levels with volume that's near or above 81,559 shares. If that breakout hits soon, then GMLP will set up to re-test or possibly take out its next major overhead resistance levels at $34.78 to its 52-week high at $36.

• [By Robert Rapier]

  Q: Golar (GMLP) has been doing well lately after an up/down and eventually flat year in 2013. �While sometimes diverging TGP performed about the same. Thoughts on any catalyst this year that might help GMLP start to trend up consistently?

Best Transportation Stocks For 2014: Eagle Rock Energy Partners LP (EROC)

Eagle Rock Energy Partners, L.P. (Eagle Rock) is a limited partnership engaged in the business of gathering, compressing, treating, processing and transporting natural gas; fractionating and transporting natural gas liquids (NGLs); crude oil logistics and marketing; natural gas marketing and trading, known as Midstream Business, and developing and producing interests in oil and natural gas properties, known as Upstream Business. On May 3, 2011, the Company acquired CC Energy II, L.L.C and outstanding membership interests of Crow Creek Energy. On May 20, 2011, it sold the Wildhorse Gathering System in its East Texas and Other Midstream Segment.

Midstream Business

The Company�� Midstream Business is located in four natural gas producing regions: the Texas Panhandle; East Texas/Louisiana; South Texas, and the Gulf of Mexico. As of December 31, 2011, these working interest properties included 591 gross operated productive wells and 1,197 gross non-operated wells with net production to the Company of approximately 87.7 million cubic feet of natural gas per day and proved reserves of approximately 234.0 Bcf of natural gas, 11.5 million barrels of crude oil or other liquid hydrocarbons of crude oil, and 11.3 million barrels of crude oil or other liquid hydrocarbons of natural gas liquids, of which 76% are proved developed. As of December 31, 2011, its Midstream Business consisted of Panhandle Segment and East Texas and Other Midstream Segment.

The Company�� Texas Panhandle Segment covers 10 counties in Texas and two counties in Oklahoma. Through the systems within this segment, the Company offers midstream wellhead-to-market services, including gathering, compressing, treating, processing and selling of natural gas, and fractionating and selling of NGLs. As of December 31, 2011, approximately 213 producers and 2,072 wells and central delivery points were connected to the systems in its Texas Panhandle Segment. The Texas Panhandle Segment averaged gathered volumes fo! r 2011 of approximately 155.1 million cubic feet of natural gas per day. As of December 2011, Chesapeake Energy and BP America Production represented 14% and 11%, respectively, of the total volumes of its Texas Panhandle Segment. The Texas Panhandle Segment consists of approximately 3,963 miles of natural gas gathering pipelines, ranging from two inches to 24 inches in diameter; seven natural gas processing plants with an aggregate capacity of 210 million cubic feet of natural gas per day; a propane fractionation facility with capacity of 1.0 million cubic feet of natural gas per day, and two condensate collection and stabilization facilities.

Eagle Rock�� systems in the East Panhandle (northern Wheeler, Hemphill and Roberts Counties, Texas) gather and process natural gas produced in the Morrow and Granite Wash reservoirs of the Anadarko basin. In the Panhandle Segment, natural gas is contracted at the wellhead primarily under percent-of proceeds (which includes percent-of-liquids) fixed recovery, percent-of-index and fee-based arrangements that range from one to five years in term. During the year endede December 31, 2011, it produced over 2,600 equity barrels per day of condensate in the Texas Panhandle Segment. During 2011, it stabilizes approximately 2,000 barrels per day combined at its Superdrip and Cargray Stabilizers.

The Company�� East Texas and Other Midstream Segment operates within the natural gas producing regions, such as East Texas/Louisiana, South Texas and the Gulf of Mexico. Through its Texas/Louisiana region, it offers producers natural gas gathering, treating, processing and transportation and NGL transportation across 21 counties in East Texas and seven parishes in West Louisiana. Its operations in the South Texas region primarily gather natural gas and recover NGLs and condensate from natural gas produced in the Frio, Vicksburg, Miocene, Canyon Sands and Wilcox formations in South Texas. Its operations in the Gulf of Mexico region are non-operated owne! rship int! erests in pipelines and onshore plants which are all located in southern Louisiana. The Gulf of Mexico region also provides producer services by arranging for the processing of producers��natural gas into third-party processing plants, known as Mezzanine Processing Services.

As of December 31, 2011, approximately 705 wells and central delivery points were connected to its systems in the East Texas and Other Midstream Segment. As of December 31, 2011, the East Texas and Other Midstream Segment provides gathering and/or marketing services to approximately 140 producers. During 2011, the East Texas and Other Midstream Segment averaged gathered volumes of approximately 319.9 million cubic feet of natural gas per day. As of December 31, 2011, Stone Energy Corporation and Anadarko Petroleum Company represented 18% and 9%, respectively, of the total volumes of its East Texas and Other Midstream Segment. Residue gas pipelines include Houston Pipeline Company, Natural Gas Pipeline Company, Tennessee Gas Pipeline, Crosstex Energy L.P. and Southern Natural Pipeline.

Upstream Business

The Company�� Upstream Business located in four regions within the United States, such as Southern Alabama, which includes the associated gathering, processing and treating assets; Mid-Continent, which includes areas in Oklahoma, Arkansas, Texas Panhandle and North Texas; Permian, which includes areas in West Texas, and East/South Texas/Mississippi assets. As of December 31, 2011, these working interest properties included 591 gross operated productive wells and 1,197 gross non-operated wells with net production of approximately 87.7 million cubic feet of natural gas per day and proved reserves of approximately 234.0 Bcf of natural gas, 11.5 million barrels of crude oil or other liquid hydrocarbons of crude oil, and 11.3 million barrels of crude oil or other liquid hydrocarbons of natural gas liquids, of which 76% are proved developed.

The Southern Alabama region includes the! Big Esca! mbia Creek, Flomaton and Fanny Church fields located in Escambia County, Alabama. These fields produce from either the Smackover or Norphlet formations at depths ranging from approximately 15,000 to 16,000 feet. The Big Escambia Creek field encompasses approximately 11,568 gross and 7,334 net Eagle Rock operated acres. It operates 18 productive wells with an average ownership of 60% working interest and 51% net revenue interest in the Big Escambia Creek field. The Fanny Church field is located two miles east of Big Escambia Creek. Its ownership includes approximately 1,284 gross and 999 net operated acres that include three productive operated wells with an average ownership of 86% working interest and 66% net revenue interest. The Flomaton field is adjacent to and partially underlies the Big Escambia Creek field. The field encompasses approximately 1,280 gross and 1,256 net Eagle Rock operated acres and produces from the Norphlet formation at depths from approximately 15,000 to 16,000 feet. It operates three productive wells with an approximate average 91% working interest and 78% net revenue interest. The Smackover and Norphlet reservoirs are sour, gas condensate reservoirs which produce gas and fluids containing a high percentage of hydrogen sulfide and carbon dioxide.

The Mid-Continent region consists of operated and non-operated properties across the Golden Trend Field, Cana Shale play, Verden Field, and other western Oklahoma fields located in the Anadarko Basin in Oklahoma, the Mansfield Field and other various fields in the Arkoma Basin in Arkansas and Oklahoma, various fields in the Texas Panhandle, and the Barnett Shale in north Texas. Productive depths range from approximately 2,500 feet in the Arkoma fields of western Arkansas to greater than 18,000 feet in the Springer formation in certain western Oklahoma fields. Its producing field is the Golden Trend field that extends across Grady, McClain and Garvin counties in Oklahoma. It has 14,621 net acres in the Cana Shale play exte! nding acr! oss Canadian, Blaine and Dewey counties, Oklahoma. The Cana Shale produces from horizontal wells drilled to vertical depths of 11,000 - 13,000 feet and extended with horizontal lateral lengths of approximately 5,000 feet. In the total Mid-Continent region, it operate 316 productive wells and own a working interest in an additional 1,054 non-operated productive wells. The average working interest in these productive operated and non-operated wells is 83% and 9%, respectively. The net production averaged approximately 53.2 million cubic feet of natural gas per day during 2011, of which approximately 77% was produced from wells it operated.

The Permian region contains numerous fields, including Block 27, Estes Block 34, H.S.A., Heiner, Monahans N., Payton, Running W., Ward S, and Ward-Estes N. located mainly in Ward, Pecos, and Crane Counties, Texas. These fields are located in the Central Basin Platform which extends from central Lea County in New Mexico to central Pecos County in Texas and encompasses hundreds of individual fields with multiple productive intervals from the Yates-Seven Rivers-Queen through the Ellenburger formations. The Ward County fields contains two major properties, the Louis Richter and the American National Life Ins. Co. leases, and encompasses approximately 10,285 gross and 10,215 net Eagle Rock acres. It operate multiple fields consisting of stacked multi-pay horizons that produce from depths of 2,300 feet (Yates) to 9,100 feet (Pennsylvanian). The Southern Unit is located in the Running W Waddell field and produces predominantly oil at depths from approximately 5,750 to 5,900 feet. It operates approximately 5,875 net acres in this area.

The East/South Texas/Mississippi region includes the Aker, Birch, Edgewood, Eustace, Fruitvale, Ginger and Wesson fields in East Texas, the Jourdanton field in South Texas, and the Chicora W, High Road, and Stafford Springs fields in Mississippi. The East Texas fields produce primarily from the Smackover Trend at depth! s from 12! ,000 to 12,700 feet and encompass approximately 18,991 gross and 15,872 net Eagle Rock acres. It operates 32 productive wells, which produce gas that contains between approximately 30% to 69% of impurities (hydrogen sulfide, nitrogen, and carbon dioxide). The Edgewood field also contains two productive gas wells in the Cotton Valley at depths of 11,500 to 11,600 feet which produce sweet natural gas. The East Texas production, with the exception of a single well, is delivered to the third party owned Eustace Plant for separation of condensate, removal of impurities, and extraction of natural gas liquids and sulfur for a combination of fees and percentage of proceeds.

In South Texas, it operates wells in the Jourdanton field in Atascosa County, Texas. It operates nine productive wells with 100% working interest and 88% net revenue interest. Its production from the field is primarily from the Edwards carbonates (7,300 to 7,400 feet). On December 31, 2011, the Company had under operation 290 gross (261 net) productive oil wells and 301 gross (251 net) productive natural gas wells. On December 31, 2011, Eagle Rock owned non-operated working interests in an additional 148 gross (18 net) productive oil wells and 1049 gross (72 net) productive natural gas wells.

The Company competes with DCP Midstream, LLC and Enbridge Energy Partners, L.P., Crosstex Energy, L.P., Energy Transfer Partners, LP and Enterprise Products Partners, L.P.

Advisors' Opinion:

• [By Ben Levisohn]

  Eagle Rock Energy Partners (EROC) has advanced 3.9% to $6.60 after it was upgraded to Market Perform from Underperform at Raymond James.

  United Parcel Service (UPS) and FedEx (FDX) blamed bad weather and a glut of packages for delayed holiday deliveries. So far, the market response has been muted: Shares of United Parcel Service are unchanged in pre-open trading, while FedEx has gained 0.4% to $142.50.

• [By Robert Rapier] Most MLP investors have two main concerns: the preservation of capital and reliable income — in that order. These two objectives are, of course, closely linked. An MLP that treats its investors to negative distribution surprises is likely to be an MLP that does a poor job of preserving capital. For example, Eagle Rock Energy Partners (Nasdaq: EROC) has lost 25 percent of its value since announcing a distribution cut in late October.
  

  But how does an investor judge whether an MLP is at risk of a surprising distribution cut? As we discussed recently in The Unkindest Cut for MLPs, some classes of MLP are more susceptible to cuts than others. For variable distribution MLPs, it’s par for the course. Distributions go up, and they go down — depending on market conditions. MLPs focused on upstream oil and gas operations are also at greater risk of a distribution cut during periods of softening oil and gas prices.

• [By Monica Gerson]

  Eagle Rock Energy Partners LP (NASDAQ: EROC) dipped 17.55% to $6.06 in the pre-market session after the company lowered its quarterly distribution to $0.15 from $0.22 per unit.