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Ohio Utica Shale

MarkWest Energy Partners release 1Q 2013 report

By Bob Downing Published: May 9, 2013

From MarkWest Energy Partners, a major player in developing midstream facilities in Ohio's Utica shale:

DENVER--(BUSINESS WIRE)--May. 8, 2013-- MarkWest Energy Partners, L.P. (NYSE: MWE) (the Partnership) today reported quarterly cash available for distribution to common unitholders, or distributable cash flow (DCF), of $110.2 million for the three months ended March 31, 2013, compared to $109.2 million for the three months ended March 31, 2012. DCF for the three months ended March 31, 2013 represents 102 percent coverage of the first quarter distribution of $108.4 million or $0.83 per common unit, which will be paid to unitholders on May 15, 2013. The first quarter 2013 distribution represents an increase of $0.01 per common unit or 1.2 percent over the fourth quarter 2012 distribution and an increase of $0.04 per common unit or 5.1 percent compared to the first quarter 2012 distribution. As a Master Limited Partnership, cash distributions to common unitholders are largely determined based on DCF. A reconciliation of DCF to net income, the most directly comparable GAAP financial measure, is provided within the financial tables of this press release.

The Partnership reported Adjusted EBITDA of $140.8 million for the three months ended March 31, 2013, compared to $153.1 million for the same period in 2012. The Partnership believes the presentation of Adjusted EBITDA provides useful information because it is commonly used by investors in Master Limited Partnerships to assess financial performance and operating results of ongoing business operations. A reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, is provided within the financial tables of this press release.

The Partnership reported (loss) income before provision for income tax for the three months ended March 31, 2013 of ($14.2) million, compared to $20.8 million for the same period in 2012. Income (loss) before provision for income tax includes non-cash gains (losses) associated with the change in fair value of derivative instruments of $9.0 million and ($48.2) million for the three months ended March 31, 2013 and March 31, 2012, respectively, and a (loss) associated with the redemption of debt of ($38.5) million for the three months ended March 31, 2013. Excluding these items, income before provision for income tax for the three months ended March 31, 2013 and 2012 would have been $15.3 million and $69.0 million, respectively.

“Our diverse set of midstream assets continues to deliver strong financial results and create opportunities for future growth,” said Frank Semple, Chairman, President and Chief Executive Officer. “The recent completion of nine major projects since last October and the planned completion of 18 additional major projects over the next year and a half will continue to grow our fee-based income and distributable cash flow for years to come. In addition, we are very pleased with the acquisition of the Chesapeake assets in the Granite Wash and our entrance into the liquids-rich Eagle Ford Shale through our strategic agreement with Newfield Exploration.”

BUSINESS HIGHLIGHTS

 

Utica:

  • In February 2013, the Partnership, together with EMG, completed an Amended and Restated Limited Liability Company Agreement (Amended LLC Agreement) for MarkWest Utica EMG. The Amended LLC Agreement increases EMG’s capital commitment to MarkWest Utica EMG from $500 million to $950 million. The transaction provides the Partnership with flexibility in the timing of future capital contributions to MarkWest Utica EMG and accelerates the continued development of critical midstream infrastructure in the highly prospective Utica Shale.
  • In February 2013, MarkWest Utica EMG announced the execution of definitive agreements with Rex Energy Corporation (NYSE: REXX) (Rex) to provide gathering, processing, fractionation, and marketing services in the Utica Shale. MarkWest Utica EMG expects to begin providing the full-suite of midstream services for Rex by the end of the second quarter of 2013.
  • In March 2013, MarkWest Utica EMG announced the execution of definitive agreements with PDC Energy, Inc. (NASDAQ: PDCE) (PDC) to provide gathering, processing, fractionation, and marketing services in the Utica Shale. MarkWest Utica EMG expects to begin providing the full-suite of midstream services for PDC by the end of the second quarter of 2013.
  • In May 2013, MarkWest Utica EMG announced the execution of definitive agreements with CNX and an additional producer to provide processing, fractionation, and marketing services in the Utica Shale.
  • In May 2013, MarkWest Utica EMG is commencing operations of Cadiz I, a 125 MMcf/d cryogenic processing facility in Harrison County, Ohio. Cadiz I is supported by fee-based agreements with Gulfport Energy Corporation (NASDAQ: GPOR), Antero and other producers.

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Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.