CTR - Midstream/MLP Contracts: Playing The Long Game Wins

• The length of midstream contracts can vary from a few years to 20+ years, but importantly, contracts help support stable cash flows used to pay the attractive dividends offered by many energy infrastructure companies.
• Contract tenures vary by company and asset type. At the longer end of the spectrum, contracts related to liquefied natural gas (LNG) export facilities tend to have initial terms of 20 or 25 years.
• While individual companies manage re-contracting risk by staggering their contract expirations, re-contracting risk can be effectively mitigated by owning the energy infrastructure space through a diversified exchange-traded product, mutual fund, or closed-end fund.

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