High Yielding Dividend Stocks Creating American Energy Independence

Midstream companies can be looked upon as the oil and gas industry equivalent of UPS, or more accurately, Amazon Prime Delivery. In the same way Amazon Prime imports, sorts and separately packages bulk delivered items for individual delivery and then transports them to various warehousing hubs for subsequent sorting pursuant to direct inland transport according to zip codes, midstream companies’ logistics services create the infrastructure of the energy industry in America. 

Publicly traded midstream companies are registered as Limited Partnerships or Master Limited Partnerships. Similar to REITs, they are usually required to remit 90% of the revenues from their various contracts to unitholders. Since unitholders in a partnership are taxed differently than passive stock shareholders who receive dividends, they receive K-1s instead of 1099-DIV statements for their tax filings. The proceeds for unitholders can be classified as “high-yield”, since an APY over 6.0% is not uncommon for midstream companies. For the simplicity’s sake, the following midstream company examples are quoted based on a $10,000 investment, but the percentage is consistent regardless of the principal investment size. Prices are based on the market quotes at the time of this writing.

Energy Transfer LP

Stock #1 : Energy Transfer LP (NYSE: ET)

Yield: 7.23%

Shares for $10,000: 572.7

Annual Dividend Income: $723.00

For the past 29 years, Dallas, Texas based Energy Transfer LP (NYSE: ET) has built a solid business for itself by providing storage and transport of crude oil, natural gas, natural gas associated liquids (NGL), and refined products. 

Presently, Energy Transfer ranks as the third largest US midstream company by market cap size, which is $59.9 billion. Its supply chain network covers Texas, New Mexico, West Virginia, Pennsylvania, Ohio, Oklahoma, Arkansas, Kansas, Montana, North Dakota, Wyoming, and Louisiana. Boasting over 125,000 miles of continental US infrastructure under its umbrella, Energy Transfer’s business structure and forward thinking strategy situates it very advantageously for the future.

Energy Transfer is a Limited Partnership and is addressing the growth of LNG demand with expanded capital expenditures. An additional $2 billion was allocated for recent acquisitions, such as WTG Midstream, Lotus Midstream, and Crestwood Equity Partners. The company is also ready to kickstart the anticipated commencement of its long delayed Lake Charles LNG facility, and recently inked a deal with Cloudburst to supply power to several developing data centers located across Texas. 

Enterprise Products Partners LP

Stock #2 : Enterprise Products Partners LP (NYSE: EPD)

Yield: 6.90%

Shares for $10,000: 313.5

Annual Dividend Income: $690.00

Headquartered in Houston, TX, Enterprise Products Partners LP (NYSE: EPD) operates in CO, NM, LA, MS, WY, and TX. Founded in 1968, Enterprise Products Partners has continued to expand operations and has amassed a gigantic collection of midstream assets and services, which contribute to its $69.16 billion market cap, which ranks it #1 in the US. Its infrastructure network assets include pipelines, maritime port docking locations, fractionation plants, and storage terminals for crude oil, refined oil products, natural gas, NGLs, and petrochemicals. 

Enterprise Products Partners LP has nearly $7 billion worth of expansion projects currently under construction, making the company’s growth prospects very bullish. These include a new fractionator scheduled to launch operations in 2025, three new NGL plants in 2025-2026, and a new propane and ethane export terminal in 2026. 

Enterprise Products Partners achieved dividend aristocrat status in 2024, and this year marks its 26th year of consecutive dividend increases. 

Enbridge, Inc.

Stock #3: Enbridge, Inc. (NYSE: ENB)

Yield: 6.05%

Shares for $10,000: 224.46

Annual Dividend Amount: $605.00

Headquartered in Calgary, Canada, Enbridge, Inc. (NYSE: ENB) is a midstream company energy infrastructure company with five (5) separate divisions:

• Liquids Pipelines – Liquids Pipelines handles crude oil and liquid hydrocarbons transport and management of pipelines and terminals within Canada and the US.
• Gas Transmission and Midstream – This division invests in and manages natural gas pipelines and processing facilities.
• Gas Distribution and Storage – Tanker and pipeline delivery of natural gas utility operations throughout Ontario and Quebec to retail, commercial and industrial customers.
• Renewable Power –  This is the Green power division in charge of North American solar, wind, geothermal, waste heat recovery, and transmission assets. 
• Energy Services – This department provides logistics services and physical commodity marketing to energy producers, refiners, and other customers. 

Founded in 1949, Enbridge, Inc. has a dividend record stretching for over seven decades, while raising payouts for 28 years. Through its Mainline and Express pipelines, Enbridge transports 3 million barrels of crude daily. This allocation accounts for almost 63% of the Canadian crude oil production transported to the U.S. annually. Enbridge also delivers natural gas to roughly 7 million North American customers.

The green energy subsidy cuts in the recently signed Big Beautiful Bill will likely have minimal, if any, effect on Enbridge, since demand for its natural gas and NGL products are escalating. 

Additionally, Enbridge, Inc.’s acquisition of three natural gas processing facilities from Dominion Energy finalized in October, 2024. The deal featured:

• The East Ohio Gas Company ($6.6 billion)
• Questar Gas Company (and Wexpro natural gas supply chain – $4.3 billion)
• Public Service Company of North Carolina ($3.2 billion)

The addition of these three assets (all since renamed under the Enbridge name) is anticipated to increase Enbridge’s natural gas earnings from 12% of EBITDA to 20%. This will subsequently reduce the contribution from oil pipelines from 57% to 50% and increase natural gas pipelines from 25% to 28%.

MPLX LP

Stock #4 : MPLX LP (NYSE: MPLX)

Yield: 7.43%

Shares for $10,000: 197.4

Annual Dividend Amount: $743.00

It’s not a stretch to imagine that oil drilling and production companies might utilize the capital markets to finance their own midstream companies for their in-house use as well as for outside customers. MPLX LP is based in Findlay, OH. Incorporated in 2012, MPLX LP (NYSE: MPLX)  is a de facto  subsidiary of Marathon Petroleum (NYSE: MPC), which owns 64% of outstanding shares. With a $51.71 billion market cap, MPLX comes in at #5 among the largest US midstream company rankings. Aside from Marathon Oil’s Capline and Mark West pipeline networks, MPLX has two primary operational divisions: 

• Logistics and Storage handles transportation, distribution, storage and marketing of crude oil, refined products and other hydrocarbon-based products throughout the U.S. Consisting of a network of wholly and jointly-owned common carrier crude oil and refined product pipelines, associated storage assets, refined product terminals, storage caverns, refinery integrated tank farm assets, rail and truck racks, a marine business, export terminals, and wholesale and fuels distribution businesses, this vertical is responsible for navigating inventory supplies to be shipped to the various processing and industrial or wholesale locations. 
• Gathering and Processing is dedicated to natural gas and separating various hydrocarbon components from it for different markets. The heavier and more valuable hydrocarbon components, which have been extracted as a mixed NGL stream, are then further separated into their component parts for end-use sale through the process of fractionation. MPLX sells basic Natural Gas Liquid (NGL) products, including ethane, propane, normal butane, isobutane and natural gasoline.

MPLX is presently in the process of acquiring full ownership of the BANGL pipeline system, which connects the Texas part of the Permian Basin to fractionation facilities in the Gulf Coast. Its pipeline capacity expansion is expected to finish in 2026 and will increase from 250,000 to 300,000 barrels per day, 

Western Midstream Partners, LP

Stock #5: Western Midstream Partners, LP (NYSE: WES)

Yield: 9.41%

Shares for $10,000: 253.35

Annual Dividend Income: $941.00

Similarly to how MPLX is closely tied to Marathon Oil, Western Midstream Partners, LP’s General Partner is Occidental Petroleum Corp. (NYSE: OXY).

Headquartered in The Woodlands, TX, Western Midstream Partners, LP (NYSE: WES) is a Master Limited Partnership midstream company. Its primary operations are in the Delaware Basin in West Texas and NM, and the DJ Basin in northeastern CO. Additional assets and investments are located in South Texas, Utah, and Wyoming .

The MLP’s focus is primarily on natural gas and natural gas liquids (NGL) processing, as well as crude oil. Western Midstream’s operational assets feature 14,373 total miles of pipeline, and includes the following:

• 21 Gathering Systems
• 69 Processing and Treating facilities
• 7 Natural Gas pipelines
• 12 Crude Oil and NGL pipelines

Western Midstream Partners’ hefty dividend is buoyed by strong cash flows, cost of service contracts with minimum volume requirements, a rock solid balance sheet, and a very low leverage ratio. Although it may not lead to growth in the near term, Western Midstream Partners’ Pathfinder Pipeline project – a 42 mile, 30-inch long haul pipeline designed to transport and clean water used in drilling production, will certainly help with environmental concerns and may trigger similar steps from its competitors in the future. 

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