Sunoco Logistics Partners reports earnings for fourth quarter 2011

Sunoco Logistics Partners L.P. (NYSE: SXL) on Jan. 26 announced net income attributable to owners for the fourth quarter 2011 of $76 million ($0.60 per unit diluted), compared with $59 million ($0.47 per unit diluted) for the fourth quarter 2010.

Net income for the fourth quarter 2011 includes a $42 million charge to impair certain assets and account for regulatory obligations associated with the Partnership's assets which could be negatively impacted by Sunoco, Inc.'s announced exit from its refining operations. Excluding the charge, the Partnership had net income of $118 million ($0.99 per unit diluted).

Highlights of the fourth quarter and full year 2011 include:

-- Adjusted EBITDA for the quarter rose to a record level of $165 million and $544 million for the full year

-- Record distributable cash flow of $110 million for the quarter and $388 million for the full year

-- Continued to focus on growth: $665 million of expansion capital spending, including major acquisitions

-- Completed a three-for-one unit split on Dec. 2, 2011

"The Partnership had a record year in 2011," said Lynn L. Elsenhans, chairman and chief executive officer. "The West Texas crude oil market and developing shale production areas provided many opportunities for us to optimize our assets to generate additional cash flow. In addition, we continue to grow our ratable business which was up 14 percent year over year. 2011 expansion capital was $665 million, including $494 million of major acquisitions. Our acquisitions and organic projects over the past year are in alignment with our goal of creating long-term, sustainable growth."

In looking towards expectations for the future, Elsenhans said, "Our Mariner West project with MarkWest Energy to deliver ethane to Canada is under way. This project is backed by long-term shipper commitments and is expected to be operational by July 2013. We continue to develop our West Texas crude expansion project, which is expected to be on-line in the first quarter of 2013. For 2012, we plan to increase organic capital spending to approximately $300 million in order to capture more value from existing assets such as Eagle Point, Nederland and our patented butane blending technology, as well as Mariner West and the West Texas crude expansion."

MarkWest Energy's 3.5 million unit offering priced at 3.4 percent discount

DALLAS, Texas - The upsized offering on July 8 of 3.5 million units of MarkWest Energy Partners LP (NYSE: MWE) was priced at $48.00, a 3.4 percent discount to the unit's July 7 close. The offering will be used to fund debt repayment.

Units of the natural-gas processor and distributor on July 8 closed down 2.76 percent at $48.30.

MarkWest disclosed plans to offer 3.2 million units late on July 7, adding itself to a growing list of companies tapping equity markets to pay down debt. In addition to repaying amounts under its revolving credit facility, MarkWest planned to use some proceeds for ongoing capital expenditures.

The Partnership has granted the underwriters a 30-day option to purchase a maximum of 525,000 additional common units to cover over-allotments, if any.

In the first quarter, MarkWest recorded a loss because of derivative effects and a loss from repaying debt, but revenue climbed at most of its units.

Sunoco Logistics plans to convert pipeline to ethane transport

PHILADELPHIA, Pa. - Sunoco Logistics Partners L.P. of Philadelphia announced plans on March 22 to convert an existing pipeline to deliver ethane from Marcellus Shale drilling areas to industrial customers in Ontario, Canada.

Sunoco Logistics, the pipeline affiliate of Sunoco Inc., said it would join with MarkWest Liberty Midstream & Resources L.L.C. to develop the project. MarkWest Liberty is a partnership between MarkWest Energy Partners L.P. and the Energy & Minerals Group, an investment fund.

The partnership will use new and existing pipelines to transport up to 65,000 barrels a day of ethane from Western Pennsylvania to petrochemical customers in Sarnia, Ontario.

Marcellus wells in southwestern Pennsylvania produce a sidestream of high-value liquid hydrocarbons such as ethane, butane and propane, which must be separated at plants operated by companies such as MarkWest, a Colorado firm.

Ethane is a major ingredient in ethylene, which is used to produce plastics.

The companies declined to estimate the project's cost or earnings projections. Thomas P. Golembeski, Sunoco's spokesman, said the project was expected to go online in the third quarter of 2012.

MarkWest Energy agrees to buy EQT natural gas assets for $230 million

MarkWest Energy will pay EQT Corp. $230 million for Kentucky property.

The acquisition includes an associated natural gas liquids pipeline and a 100 million cubic feet per day cryogenic processing plant.

EQT Corporation and MarkWest Energy Partners said on Jan. 2 that MarkWest had agreed to acquire EQT's natural gas processing complex in Langley, Ky., for $230 million.

MarkWest said it will expand the cryogenic processing capacity immediately following the close of the acquisition, which is expected by the end of the first quarter.

Upon the close of the transaction, EQT will execute a long-term agreement with MarkWest to provide processing services for its Kentucky Huron/Berea shale gas, including natural gas liquids transportation, fractionation, and marketing services through 2022.