Enbridge Energy Partners, L.P. (EEP), Genesis Energy, L.P. (GEL) – Inside the Alerian Mlp (AMLP): Petroleum Transport

Buckeye Partners, L.P. (NYSE:BPL) is the modern-day iteration of one of the oldest pipeline companies in the world and, in fact, it is the oldest energy MLP trading today, with an IPO date of Dec. 16, 1986. It controls 6,000 miles of pipeline and about 100 petroleum products storage terminals across the U.S. and the Caribbean. International exposure is something that few MLPs offer investors right now. Its an important angle, and it drove growth at Buckeye Partners, L.P. (NYSE:BPL) in the second quarter.

Enbridge Energy Partners, L.P. (NYSE:EEP) has reported dismal earnings results for two straight quarters, but its 6.6% yield keeps investors hanging on. The problem at Enbridge Energy Partners, L.P. (NYSE:EEP) right now is by and large declining volumes. The partnership’s North Dakota pipeline system has had to compete with rail for the past two years, and it has very much been on the losing end of that contest. The recent collapse of the Brent/WTI spread resulted in an uptick in volume on the system, but whether that will make a big enough difference on the bottom line remains to be seen. Enbridge Energy Partners, L.P. (NYSE:EEP) also maintains a natural gas business but has plans to spin those operations off into a separate MLP called Midcoast Energy Partners.

Genesis Energy, L.P. (NYSE:GEL) is another small player in the index worth noting. Shares have been on a tear this year, up more than 35% since January. It’s a smaller MLP compared with the Magellans and the Plains of the world, focused primarily on petroleum logistics on the Gulf Coast. Operations include a growing marine transportation business, and the partnership has done well targeting the increasingly lucrative barge market. Investors should also note that Genesis Energy, L.P. (NYSE:GEL) remains committed to distribution increases, and just announced its 32nd consecutive quarterly increase.

Bottom line 
The Alerian Mlp (NYSEMKT:AMLP) performs well, and generates income without the paperwork headaches that come with individual MLP ownership via the K-1 form. Diversity mitigates risk, and that’s what you get with the 25 different MLPs in this ETF.

The article Inside the Alerian MLP Index: Petroleum Transport originally appeared on Fool.com and is written by Aimee Duffy.

Fool contributor Aimee Duffy has no position in any stocks mentioned. The Motley Fool recommends Magellan Midstream Partners.

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