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About Energy Transfer LP

Energy Transfer LP (ET) transfers natural gas and other energy resources through its massive network of US-based pipelines. The company's operations occur primarily through primary subsidiary Energy Transfer Operating, LP (ETO) and Sunoco LP, although it has interests in a number of LPs and other subsidiaries. The company operates pipelines that transport natural gas, natural gas liquids, refined products, and crude oil across the US. It also owns and operates associated terminalling, storage, and fractionation facilities. Energy Transfer LP generates about 30% of revenue through a 35% stake in Sunoco LP. In 2019 the company agreed to acquire SemGroup Corporation for $5 billion.

Operations

Energy Transfer (ET) reports financial results according to its major investments in Energy Transfer Partners, Sunoco LP, and Lake Charles LNG.

Its largest segment is Energy Transfer Operating, LP (ETO). ETO gathers, processes, compresses, treats, and transports natural gas. These midstream services occur in some of the most prolific shale plays in the US, such as Eagle Ford, Marcellus, Utica, Bone Spring, and Avalon. ETO is one of the largest movers of natural gas in the country and does so through its 71,000 miles of pipeline. It also possesses a controlling interest in a limited partnership that owns and operates a logistics business, consisting of crude oil, natural gas liquids (NGLs), and refined products pipelines. 

Its investment in Sunoco LP brings in some 35% of revenue. Sunoco LP operates almost 5,0000 gas stations and convenience stores in the Eastern US. It produces revenue through fuel sales, which typically top 2.5 billion gallons in a given year. It generates a few billion dollars from merchandise sales in its gas station convenience stores. Sunoco sells about 5 billion gallons of fuel wholesale, through nearly 8,000 dealers, distributors, and commercials customers. In 2017 this segment's pipeline and product terminals were merged into the ETO entity.

Lake Charles LNG generates a small amount of total revenue by storing and re-gasifying natural gas in its facility in Lake Charles, LA.

Geographic Reach

Dallas, TX is home to Energy Transfer Operating's and Energy Transfer's headquarters. ETO, along with the recently merged pipeline and terminal assets of Sunoco, have significant operations in Texas, Louisiana, Oklahoma, West Virginia, Pennsylvania, and New York. Its pipelines reach as far as North Dakota, Arizona, and Idaho.

The Sunoco LP subsidiary is headquartered in Philadelphia, PA and operates nearly 5,000 gas stations in 26 states, mostly in the Eastern US and Texas.

Sales and Marketing

Energy Transfer, via Energy Transfer Operating, sells natural gas to utilities, industrial consumers, other marketers and pipeline companies. Its Sunoco segment sells gasoline and diesel in addition to a broad mix of merchandise such as groceries, fast foods and beverages at its convenience stores. A sizable portion of Sunoco's gasoline and diesel sales are to wholesale customers.

Financial Performance

In recent years Energy Transfer's revenue growth has been excellent, rising from a $5.4 billion low in 2009 to a $55.7 billion peak in 2014 (driven by the Sunoco acquisition), before sliding back to $37.5 billion in 2016. Net income was rangebound between 2010 and 2013 ($200 million - $300 million) before spiking to $1.2 billion in 2015 and then falling in 2016.

In 2016, revenue decreased 11% to $37.5 billion due to a 20% fall in crude oil sales and lower refined product sales, both partially offset by higher NGL sales.

Net income in 2016 fell 17% to $983 million, the result aided by a $954 million windfall from a noncontrolling interest adjustment. Without the adjustment, net income from operations came in at a paltry $41, a 96% plummet from the prior year. Although in dollar terms operating expenses fell, when viewed as a percent of revenue, the expenses did not fall in line with revenue and therefore had a negative effect on earnings. Included in expenses was a goodwill impairment loss exceeding $1.0 billion.

Cash available at the end of 2016 was $483 million, a decrease of $123 million from 2015. Large uses of cash came from $8.0 billion of capital expenditures and a $1.6 billion outlay for acquisitions. Operations contributed $3.4 billion to cash and financing activities added almost $6.0 billion mainly through issuance of debt and notes.

Strategy

Energy Transfer has been busy in recent years. Its strategy is playing out through partnership restructuring, divestitures, capital raises, and the build out of several midstream projects.

Announced in 2016 and closed in early 2017, ET orchestrated a merger of its two primary subsidiaries – Energy Transfer Partners and the midstream assets of its Sunoco LP – into a surviving entity that kept the Energy Transfer Partners name. The deal cleans up its partnership structure and is anticipated to help with credit ratings going forward. Operational synergies are expected to be minimal.

Sunoco LP has been on an acquisition spree since 2014, spending over $700 million between then and mid-2017. Its retail acquisitions brought on board more than 120 new gas stations from previous owners Pico Petroleum, Aziz Quick Stops, Valentine Stores, Denny Oil, Aloha Petroleum, among others. It purchased a wholesaler in the US Northeast and obtained midstream assets in Alabama, Hawaii, and Texas.

To help raise capital for its acquisitions and project expenses, ET sold in late 2017 half of its interests in ET Rover Pipeline to Blackstone Energy Partners for approximately $1.6 billion. ET, through its ETO subsidiary, will remain operator of the Marcellus and Utica shale Rover Pipeline. ETO sold off partial interests in its Bakken holdings in late 2016 for $2 billion. ETO also issued perpetual preferred stock in late 2017, raising $1.5 billion.

ET is building out its already expansive midstream network of assets. In the Permian Basin it brought online an additional 600 mm cubic feet/day in processing capacity and anticipates 200 mmcf/d more by mid-2018. Its Mariner East system in the Marcellus Shale is receiving capital to expand its NGLs transport line from Ohio & Western Pennsylvania to the Marcus Hook Industrial Complex on the Eastern Atlantic coast. ET is also expanding its Mont Belvieu fractionation facility, adding more than 250 mmbpd capacity by mid 2019. In total the company spent about $4.0 billion on capital expenditures in 2016 and is on track to spent $3.5 billion in 2017.

Mergers and Acquisitions

In 2019, Energy Transfer agreed to acquire fellow pipeline and energy infrastructure firm SemGroup Corporation in a transaction valued at $5 billion. The deal would enhance Energy Transfer's midstream infrastructure connectivity, increases the company's crude oil and natural gas liquids (NGL) infrastructure, and adds direct pipelines to the Houston Ship Channel and the Nederland Terminal.

Company Background

In 2012 Energy Transfer Equity bought diversified gas player Southern Union for $9.4 billion (including $3.7 billion in debt). The acquisition made Energy Transfer Equity one of the largest natural gas infrastructure companies in the US.

That year the company also completed a $2 billion merger of a wholly owned Energy Transfer Partners subsidiary with and into Southern Union subsidiary CrossCountry Energy, LLC, which owns an indirect 50% interest in Citrus Corp., the owner of the Florida Gas Transmission pipeline system. After the merger, CrossCountry Energy remained as the surviving entity, a wholly owned subsidiary of Energy Transfer Partners.

In 2010 Energy Transfer Equity acquired the general partner stake of Regency Energy Partners and sold a 49.9% stake in its Midcontinent Express Pipeline to that company. The move was seen as a way for the company to diversify its general partner operations with the aim of getting a better return for shareholders. Regency Energy Partners focuses on the gathering, processing, marketing, and transportation of natural gas and natural gas liquids in Arkansas, Kansas, Louisiana, and Texas.

Energy Transfer Equity was formed in 2002 as La Grange Energy, a Texas limited partnership. In early 2005 it changed its name to Energy Transfer Company. In August 2005 it converted from a Texas limited partnership to a Delaware limited partnership and became Energy Transfer Equity.

Energy Transfer LP

8111 Westchester Dr STE 600
Dallas, TX 75225-6142
Phone: 1 (214) 981-0700

Firm Stats

Employer Type: Publicly Owned
Stock Symbol: ET
Stock Exchange: , NYSE
CFO: Thomas E. Long
EVP and General Counsel: Thomas P. Mason
President: John W. McReynolds
Employees (This Location): 170
Employees (All Locations): 11,768

Major Office Locations

Dallas, TX

Other Locations

Cullman, AL
Decatur, AL
Huntsville, AL
Selma, AL
Flagstaff, AZ
Mohave Valley, AZ
Window Rock, AZ
Winslow, AZ
Durango, CO
Grand Junction, CO
Bonita Springs, FL
Brooksville, FL
Bushnell, FL
Clearwater, FL
Clermont, FL
Cocoa, FL
Cocoa Beach, FL
Delray Beach, FL
Englewood, FL
Florida City, FL
Fort Myers, FL
Fort Pierce, FL
Gainesville, FL
Homestead, FL
Jacksonville, FL
Jupiter, FL
Lady Lake, FL
Lakeland, FL
Lake Worth, FL
Largo, FL
Mangonia Park, FL
Melbourne, FL
Merritt Island, FL
Miramar, FL
Naples, FL
Nokomis, FL
Ocala, FL
Okeechobee, FL
Orlando, FL
Palm City, FL
Pompano Beach, FL
Port Charlotte, FL
Port Saint Lucie, FL
Rockledge, FL
Saint Petersburg, FL
Sanford, FL
Sarasota, FL
Sebastian, FL
Stuart, FL
Tampa, FL
Titusville, FL
Vero Beach, FL
West Palm Beach, FL
Wildwood, FL
Winter Haven, FL
Winter Park, FL
Zephyrhills, FL
Acworth, GA
Atlanta, GA
Augusta, GA
Byron, GA
Calhoun, GA
Conley, GA
Jonesboro, GA
Kennesaw, GA
Lithonia, GA
Macon, GA
Perry, GA
Smyrna, GA
Stone Mountain, GA
Tucker, GA
Warner Robins, GA
Galesburg, IL
Johnsonville, IL
Kewanee, IL
Marion, IL
Pleasant Hill, IL
Springfield, IL
Tuscola, IL
Waverly, IL
West Frankfort, IL
Ambia, IN
Fort Wayne, IN
Indianapolis, IN
Knox, IN
Monroeville, IN
Montezuma, IN
Greensburg, KS
Haven, KS
Lawrence, KS
Liberal, KS
Louisburg, KS
Meade, KS
Olpe, KS
Overland Park, KS
Satanta, KS
Burlington, KY
Bastrop, LA
Baton Rouge, LA
Bossier City, LA
Centerville, LA
Epps, LA
Erath, LA
Haynesville, LA
Houma, LA
Lake Charles, LA
Longville, LA
New Iberia, LA
Patterson, LA
Pollock, LA
Beverly, MA
Boston, MA
Cambridge, MA
Fall River, MA
Foxboro, MA
Mansfield, MA
Nantucket, MA
North Attleboro, MA
Revere, MA
Salem, MA
Tewksbury, MA
Wayland, MA
West Springfield, MA
Baltimore, MD
Howell, MI
Jackson, MI
Lambertville, MI
Taylor, MI
Waterford, MI
Centralia, MO
Grandview, MO
Hannibal, MO
Independence, MO
Kirksville, MO
La Monte, MO
Monett, MO
Neosho, MO
Saint Joseph, MO
Warrensburg, MO
Oxford, MS
Rolling Fork, MS
Schlater, MS
Shaw, MS
Charlotte, NC
Durham, NC
Fayetteville, NC
Gastonia, NC
Lillington, NC
Mebane, NC
Reidsville, NC
Shallotte, NC
Williamston, NC
Cedarville, NJ
Egg Harbor Township, NJ
Millville, NJ
Monroe Township, NJ
Mount Laurel, NJ
Penns Grove, NJ
Rutherford, NJ
Westville, NJ
Albuquerque, NM
Bloomfield, NM
Carlsbad, NM
Gallup, NM
Jal, NM
Laguna, NM
Los Lunas, NM
Mountainair, NM
Portales, NM
Roswell, NM
Taos, NM
Las Vegas, NV
Albany, NY
Clayton, NY
Corning, NY
Honeoye Falls, NY
Lawrence, NY
Newark, NY
New Hartford, NY
Niagara Falls, NY
Penn Yan, NY
Rochester, NY
Warners, NY
Akron, OH
Blue Ash, OH
Cleveland, OH
Columbus, OH
Cygnet, OH
Dayton, OH
Haverhill, OH
Holland, OH
Lima, OH
Maumee, OH
Oregon, OH
Powell, OH
Swanton, OH
Altus, OK
Alva, OK
Ardmore, OK
Cashion, OK
Chickasha, OK
Del City, OK
Duncan, OK
Enid, OK
Okmulgee, OK
Seminole, OK
Tulsa, OK
Allentown, PA
Annville, PA
Bridgeville, PA
Coraopolis, PA
Delmont, PA
Exeter, PA
Harrisburg, PA
Hatboro, PA
Hershey, PA
Hopewell, PA
Latrobe, PA
Lock Haven, PA
Marcus Hook, PA
Middleburg, PA
Middletown, PA
Mill Hall, PA
Milton, PA
Montoursville, PA
Northumberland, PA
Oxford, PA
Philadelphia, PA
Phoenixville, PA
Pittsburgh, PA
Reading, PA
Rebersburg, PA
Sharon Hill, PA
Somerset, PA
Wayne, PA
Whitehall, PA
Williamsport, PA
Riverside, RI
West Warwick, RI
Aiken, SC
Blacksburg, SC
Charleston, SC
Columbia, SC
Dillon, SC
Goose Creek, SC
Greenville, SC
Greenwood, SC
Hardeeville, SC
Hartsville, SC
Hilton Head Island, SC
Ladson, SC
Moncks Corner, SC
Mount Pleasant, SC
North Charleston, SC
Orangeburg, SC
Piedmont, SC
Rock Hill, SC
Spartanburg, SC
Summerville, SC
Townville, SC
Walterboro, SC
Dyersburg, TN
Greeneville, TN
Hornsby, TN
Jefferson City, TN
Johnson City, TN
Lenoir City, TN
Madison, TN
Maryville, TN
Morristown, TN
Nashville, TN
New Johnsonville, TN
New Tazewell, TN
Tullahoma, TN
Alice, TX
Barstow, TX
Bay City, TX
Beaumont, TX
Beeville, TX
Bryan, TX
Cleburne, TX
Comfort, TX
Corpus Christi, TX
Cypress, TX
Dallas, TX
Dawn, TX
Eagle Pass, TX
Edna, TX
Franklin, TX
George West, TX
Gonzales, TX
Harlingen, TX
Hawley, TX
Hearne, TX
Houston, TX
Jacksonville, TX
Karnes City, TX
Kermit, TX
La Grange, TX
Laredo, TX
League City, TX
Liberty, TX
Longview, TX
Lumberton, TX
Mansfield, TX
Maypearl, TX
Mercedes, TX
Midland, TX
Monahans, TX
Nederland, TX
Odessa, TX
Pampa, TX
Pasadena, TX
Pearland, TX
Pecos, TX
Pharr, TX
Pleasanton, TX
Port Arthur, TX
Robstown, TX
Round Rock, TX
San Antonio, TX
Sanger, TX
Sour Lake, TX
Sugar Land, TX
Tennessee Colony, TX
Victoria, TX
Wharton, TX
Yoakum, TX
Zapata, TX
Kent, WA
Beckley, WV
Kenova, WV
Wayne, WV