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Boardwalk Pipeline Partners Is 1 MLP With Pipelines Perfectly Positioned for LNG Exports

There's no doubt about it, this has been a rough year for Boardwalk Pipelines Partners (NYSE: BWP  ) . The MLP's units are down more than 27% as it cut its distribution amid slumping income. However, Gulf Coast LNG export facilities like those being built by Cheniere Energy Partners (NYSEMKT: CQP  ) as well as those proposed by Energy Transfer Partners (NYSE: ETP  ) have its pipelines perfectly positioned to supply gas to those facilities and future income to investors.

LNG Exports are focused along the Gulf Coast
While energy companies have filed to build LNG export facilities along the east and west coasts of America, the bulk of the projects are concentrated along the Gulf Coast as noted on the following slide from Cheniere Energy Partners.

Source: Cheniere Energy Partners Investor Presentation (link opens a PDF)

As that slide points out more than a half dozen LNG export facilities are in the process of being constructed along the U.S. Gulf Coast including Cheniere Energy Partners' Sabine Pass facility and Energy Transfer Partners' proposed Lake Charles facility.

While not every facility will be built, several are likely to eventually come online. The first one will be Cheniere Energy Partners' Sabine Pass, which is expected to start exporting LNG next year. Meanwhile, next year will be an important decision year for Energy Transfer Partners as it will make the final investment decision for Lake Charles LNG by mid-year as noted on the next slide.

Source: Energy Transfer Partners Investor Presentation (link opens a PDF)

While Energy Transfer Partners' Lake Charles facility wouldn't be fully operational until 2020, if complete it and others like it would necessitate additional gas supplies needing to be delivered to the Gulf Coast. It's this long pipeline of LNG projects that bodes well for Boardwalk Pipeline Partners as its pipelines are perfectly positioned to supply gas to these export facilities.

How Boardwalk Pipeline Partners can profit from LNG exports
Take a look at the following asset map from Boardwalk Pipeline Partners.

Source: Boardwalk Pipelines Partners Investor Presentation (link opens a PDF)

As that map points out Boardwalk Pipeline Partners' pipelines are in the perfect position to supply these Gulf Coast LNG export facilities. The company's pipelines have key natural gas receipt locations in the Haynesville and Fayetteville Shale plays, which are likely going to be two key supply basins for LNG exports as both are located in close proximity to the Gulf Coast. Because of this Boardwalk Pipeline Partners should make a lot of money for its investors as it likely will be a key gas shipper to support export facilities.

Investor takeaway
2014 has been a rough year for investors in Boardwalk Pipelines Partners. However, its future could be much brighter as its pipelines are perfectly positioned to make it a key natural gas supplier to LNG export facilities from companies like Cheniere Energy Partners and Energy Transfer Partners. That's important upside to a company that hasn't had much of it this year.

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Matt DiLallo

Matthew is a Senior Energy and Materials Specialist with The Motley Fool. He graduated from the Liberty University with a degree in Biblical Studies and a Masters of Business Administration. You can follow him on Twitter for the latest news and analysis of the energy and materials industries:

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8/27/2015 4:02 PM
BWP $13.42 Up +0.53 +4.11%
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ETP $48.61 Up +1.89 +4.05%
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