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Oil & Gas Master Limited Partnerships

Opportune LLP

Can Positive Free Cash Flow Be Achieved In Today’s Upstream Oil & Gas Industry?

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As growth slows and investor expectations change, achieving positive cash flow will be crucial going forward in 2021. Originally published in NAPE Magazine, January 2021 ...more

Eversheds Sutherland (US) LLP

DC Circuit denies recovery of income tax allowance by oil pipeline partnership

On July 31, 2020, the US Court of Appeals for the DC Circuit issued a per curiam opinion in SFPP L.P. v. Federal Energy Regulatory Commission, et al. The DC Circuit denied the recovery of an income tax allowance by SFPP L.P....more

Bracewell LLP

Utilizing REITs for Midstream Assets

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The real estate investment trust (REIT) has been a preferred vehicle for investment in income producing real estate portfolios. The REIT provides investors with many federal income tax benefits associated with C-corporations,...more

Orrick, Herrington & Sutcliffe LLP

FERC Issues Final Rule Regarding Income Tax Allowances in Rate Setting for Pipelines: MLPs Not Precluded from Tax Allowance

On Wednesday, July 18, 2018, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued a final rule regarding the application of income tax rate reductions in setting natural gas pipeline rates.  ...more

Eversheds Sutherland (US) LLP

FERC orders natural gas pipelines to address federal income tax changes

On July 18, the Federal Energy Regulatory Commission (FERC) issued orders (i) adopting procedures to implement the federal corporate income tax rate reduction in natural gas pipeline rates, and (ii) providing guidance...more

Jones Day

FERC Announces Initiatives Regarding Income Tax Cost Recovery for Pipelines and Utilities

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The Situation: The United Airlines, Inc. v. FERC decision and the reduction of corporate income tax rate in the Tax Cut and Jobs Act significantly lowered the tax costs able to be included in the jurisdictional rates of...more

Orrick, Herrington & Sutcliffe LLP

FERC Abandons Tax Allowance in MLP Pipeline Rate Setting and Signals Changes Due to Tax Act Rate Drop

On Thursday, March 15, 2018, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued a series of orders and notices to address changing the treatment of income tax costs in rate setting for oil and natural...more

McGuireWoods LLP

Energy Companies Take Hit After FERC MLP Decision

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In a March 15 decision, the Federal Energy Regulatory Commission (FERC) disallowed certain tax benefits for master limited partnerships (MLPs), the predominant corporate structure for several energy companies....more

Eversheds Sutherland (US) LLP

FERC eliminates tax allowances for MLP pipelines, proposes tax-related rate reviews

On March 15, 2018, the Federal Energy Regulatory Commission (FERC) issued important orders regarding two significant tax-related rate matters affecting interstate oil and natural gas pipelines. The action eliminated tax...more

Cadwalader, Wickersham & Taft LLP

FERC Addresses Effects of Tax Cuts on Jurisdictional Rates and Disallows Income Tax Component in MLP-Owned Partnership Pipeline...

On March 15, 2018, the Federal Energy Regulatory Commission (“FERC”) issued an order on remand disallowing an income tax component in cost-of-service rates charged by an interstate oil pipeline owned by a master limited...more

Latham & Watkins LLP

Tax Cuts & MLPs: FERC Announces Changes Designed to Reduce Cost-Based Rates Charged by Regulated Pipelines

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FERC eliminates tax allowance in MLP pipelines’ cost-based rates and establishes procedures to address income tax changes. Key Points: ..FERC will no longer permit MLPs to recover an income tax allowance in cost-based...more

King & Spalding

Master Limited Partnerships: Fundamentals and Related Structuring and Formation Considerations

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It has been a rough three years in the energy sector. We all witnessed the precipitous decline in oil and gas prices and the wide-spread carnage that followed. As of July 2017, 130 oil and gas producers have filed for...more

King & Spalding

Mineral and Royalty Interest MLPs: An Alternative Exit For PE-Backed Mineral and Royalty Interest Cos.

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Oil and gas exploration companies no longer have to go door-to-door, or ranch-to-ranch, to negotiate oil and gas leases with individual mineral interest owners. Over the last decade or more, pure-play mineral and royalty...more

Akin Gump Strauss Hauer & Feld LLP

Final Regulations on MLP Qualifying Income Provide Clarification

Final regulations issued by the Treasury and the Internal Revenue Service (IRS) on January 19, 2017, revealed a set of new rules interpreting “qualifying income” under Section 7704(d) of the Internal Revenue Code, affecting...more

Latham & Watkins LLP

IRS and Treasury Finalize Guidance Determining MLP Qualifying Income

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Regulations provide rules for determining MLP qualifying income from certain mineral or natural resource-related activities and services. On January 19, 2017, the US Department of the Treasury (Treasury) and the Internal...more

Orrick, Herrington & Sutcliffe LLP

Midnight Regulations Provide Oil & Gas MLPs with Favorable Answers; New Administration Immediately Withdraws

On January 19, 2017, less than 24 hours before the change of administration, the IRS and Treasury released much-anticipated final regulations under Code section 7704(d)(1)(E) setting parameters for qualifying income for...more

Bracewell LLP

Delaware Chancery Court Dismisses Challenge to MLP Drop Down Transaction

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The Delaware Chancery Court recently dismissed a challenge to a transaction in which a master limited partnership (the "MLP") repurchased an interest in a crude oil pipeline in 2015 previously sold to its general partner (the...more

Latham & Watkins LLP

Restructuring Oil and Gas Partnership Debt? Tax Planning Is Key

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Tax partnerships, including MLPs, seeking to restructure debt face peril and possibility during challenging times. With the lowest oil prices in more than a decade and the equity markets effectively closed to them, oil...more

Latham & Watkins LLP

Commenters Weigh in on Proposed Regulations for Determining MLP Qualifying Income

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IRS’ proposed MLP regulations generate flurry of specific industry-related comments and spur public hearing. “I’m mad as Hell, and, frankly, I’m not going to take it anymore.” — Paraphrase of concerned citizen and...more

Eversheds Sutherland (US) LLP

Master Limited Partnerships: Proposed Tax Regulations Scale Back Activities Giving Rise to Qualifying Income

The Treasury Department (Treasury) and the Internal Revenue Service (Service) have issued proposed tax regulations (Proposed Regulations) that provide guidance on, and significantly scale back, the types of activities...more

Dechert LLP

Publicly Traded Partnership Proposed Regulations

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Widely held partnerships are a significant source of funding for oil, gas and certain natural resources projects, but the publicly traded partnership (“PTP”) rules can cause such partnerships to be treated as corporations for...more

K&L Gates LLP

New MLP Rules Provide Bright Lines and New Challenges

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On May 5, 2015, the Internal Revenue Service (“IRS”) released proposed regulations that, if finalized, would provide guidance on qualifying income from minerals and natural resources activities for master limited partnerships...more

BakerHostetler

IRS Publishes Proposed Regulations Addressing Fracking Services by MLPs

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On May 6, 2015, the Internal Revenue Service (IRS) published proposed regulations [REG-132634-14], which if finalized would clarify that income from certain oil and natural gas fracturing (“fracking”) services is “qualifying...more

Skadden, Arps, Slate, Meagher & Flom LLP

"Managing Related-Party Transactions With Yieldco and MLP Vehicles After El Paso Pipeline"

Sponsors generally form a yieldco or a master limited partnership (MLP) because the structure of these permanent capital vehicles allows for the issuance of equity to investors at a lower cost of capital, providing a...more

McGuireWoods LLP

It’s All About the Process: Lessons from Delaware Court on MLP’s Conflicts Committee Approval

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On April 20, 2015, the Delaware Court of Chancery issued a post-trial opinion in the case In Re: El Paso Pipeline Partners L.P. (C.A. No. 7141-VCL), finding El Paso Pipeline GP Company LLC, the general partner (GP) of El Paso...more

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