No. of Recommendations: 3
Hi Denny!

Due to the amount of NG available as a fracking by-product (and it's dramatically lowered price), I see NG as the "bridge" fossil fuel....that is, the bridge to other, cleaner energy sources, as we gradually replace more coal and oil (at least in generating electricity). Of course, this transition will take quite some time, but the trend is clear...the US has recently crossed the point wherein the amount of electricity generated from NG exceeds that of coal (33%+ versus 30%)....and the trend continues.

Rather than a pure commodity play on NG (that it's price will rise as demand increases,assuming the supply situation remains as is...a big assumption), I have invested in the best of class NG pipeline MLP's....which were beaten down during the last few years of energy stock price declines. The best of these companies derive most of their revenue from the transportation of NG (but some also get income from oil transportation, and other petroleum-based "liquids"). Some of then have NG price related exposure; some don't...and the amount varies. Sort of a sell the "picks and shovels" approach versus the gold miners.

Personally, I have focused on these names, in the following order of safety (distribution coverage ratio and debt levels/payoff schedules....and lesser exposure to NG commodity pricing:

MMP, EPD, OKE, SEP, ENB....with MMP and EPD being the cream of the crop.

If you have invested in MLP's before and are aware of their special tax situation and implications, great. If not, read up on them before you do....not sure if you have the same sort of tax issues (i.e. UBTI in tax-deferred accounts).

None of these names are the fast-growers that you tend to favor; rather "get-rich slowly" types of investments....perfect for the nature of my portfolio....and one of the keys to having achieved my goal of meeting 100% of all living expenses from a combination of dividends/distributions, Social Security and a VERY small pension (about $9K/year) by age 70.

Of course, my opinions a few dollars American will fill your gas tank in Venezuela. ;-)

Cheers!
Murph
II and PP Home Fool
(long MMP, EPD, OKE, ENB and a few other pipeline MLP's)
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