Back to top

Image: Bigstock

UGI Corp. Arm to Expand Capacity of Auburn Gathering System

Read MoreHide Full Article

UGI Corporation’s (UGI - Free Report) subsidiary, UGI Energy Services, LLC recently announced its intention to expand its Auburn Gathering System. The King Of Prussia, PA-based holding company provides midstream energy services through UGI Energy. The Auburn Gathering System is almost a $215 million project located in Pennsylvania. Currently, Auburn Gathering System runs across the Susquehanna, Wyoming, and Luzerne counties, and connects shippers to the interstate pipeline system.

UGI Corporation, which distributes, stores, transports and markets energy products and related services, plans to build two new compressor stations that will expand the system’s capacity by 150,000 dekatherms per day. Following the completion of the project, the system will have a total capacity of 620,000 dekatherms per day. The company intends to build these stations in Susquehanna County and Wyoming County, and invest $50 million in the project. The deliveries from the project are anticipated to start this fall and the balance capacity will be available one year from then. 

The project is expected to support the growing demand for Marcellus gas. The expansion has a long-term commitment backing from the Houston, TX-based exploration and production company, Cabot Oil & Gas Corporation that operates in the prolific Marcellus shale. The project will likely enable UGI Energy to transport Marcellus gas, including Cabot Oil & Gas’ products to several new regions. Moreover, the expansion project bodes well for the company, which has a fee-based revenue structure. 

Zacks Rank and Other Stocks to Consider

Currently, UGI Corporation sports a Zacks Rank #1 (Strong Buy).

Investors interested in the Energy sector can opt for other top-ranked stocks in the same space like Nine Energy Service, Inc. (NINE - Free Report) and Delek US Holdings, Inc. (DK - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Houston, TX-based Nine Energy Service is an onshore service provider. For 2018, its bottom line is likely to be up 181.7%. In the last reported quarter, the company delivered a positive earnings surprise of 28.6%.

Brentwood, TN-based Delek is a downstream energy company. The company’s top line for 2018 is anticipated to improve 35.6% year over year, while its bottom line is expected to increase 159.5%.

Wall Street’s Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>


Zacks' 7 Best Strong Buy Stocks (New Research Report)


Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.


Click Here, It's Really Free

Published in