Market Overview

East Daley: Oil and Gas Production Growth in the U.S. Will Continue to Propel Future Midstream Sector Earnings


Recently released analysis suggests strong earnings for midstream
companies with exposure to the Permian Basin, including Energy Transfer
(ETP), Enterprise Products Partners (EPD) and Plains All American (PAA),
are expected to continue from increasing production growth and marketing

Daley Capital Advisors, Inc.,
an energy information and insights
provider that is redefining how markets view risk for midstream and
exploration and production (E&P) companies released new analysis which
underscores that overall midstream sector growth is up, primarily due to
increased oil and gas production, and will continue into the near
future. Permian Basin production growth is largely responsible for
helping companies beat expectations, which is in line with East Daley's Consensus
Comparison Report
, which provides investors with key analysis
prior to earnings calls. In the report, six of seven midstream companies
beat consensus where East Daley had a significant (>5%) beat, which
validates East Daley's rigorous approach to asset-level research.

"We are optimistic about the fundamentals that support the cash-flow
generating ability of the midstream market for the remainder of this
year and as we move into 2019," said Justin Carlson, VP and Managing
Director, Research at East Daley Capital. "The midstream sector is
really strong right now, but outliers do exist, and investors do need to
exercise some caution. Looking closely at long-term asset health is an
absolute must to truly understand how to best succeed in this boom
environment, because even when the market is sending strong signals for
growth, not all assets and companies are equal."

East Daley analysis also indicated that companies not only benefited
from volume growth, but also operational leverage, higher walk-up tariff
rates and improved marketing profits. Oil and gas marketing gains at
midstream companies with exposure to the Permian should continue over
the next 18-months as there is only one large-scale Permian takeaway
project planned within the next year, which is the Sunrise expansion
(PAA) going into operation in 4Q2018. For Permian basis to equalize with
other key pricing locations in the U.S., additional crude oil takeaway
capacity is needed.

East Daley
for more information on the Consensus
Comparison Report or Earnings Scorecard.

East Daley has the largest asset database of U.S. energy infrastructure
tied to EBITDA and its patent-pending production allocation model,
combined with in-depth analysis, brings greater transparency to the
energy and commodity financial market by providing investors and market
participants with deeper, more accurate data to inform their investment
and strategy decisions.

About East Daley Capital Advisors, Inc.

East Daley Capital is an energy information and insights provider that
is redefining how markets view risk for midstream and exploration and
production (E&P) companies. In addition to using top-level financial
data to predict a company's performance, East Daley delivers asset and
commodity analysis that provides comprehensive, fact-based intelligence.
Supported by a team of unbiased, experienced financial and commodity
analysts, East Daley provides its clients unparalleled insight into how
midstream and E&P companies operate and generate cash flow, in addition
to commodity forecasting. East Daley uses publicly available fundamental
data and intersects that data with a company's reported financials to
asset-level adjusted-EBITDA and distributable cash flow (DCF). The
result allows for more informed investment decisions. Founded in 2014,
the company is based in Centennial, Colorado. For more information visit

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