The controversial Dakota Access pipeline, developed by the Energy Transfer Partners ETP, has leaked more than 100 gallons of oil in North Dakota. Two separate incidents of leakage were recorded in March in the $3.78 billion pipeline system.

About the Leakages

On Mar 3, the State Health Department announced that 84 gallons of oil spilled from the connecting segment of two sections of the Dakota Access pipeline in Watford City. The spill was contained on site by stopping the flow of oil. The polluted snow and soil were also later removed. The department’s environmental health database has importantly stated that no human life, wildlife and waterways were affected by the spill.

In another incident of leakage, 20 gallons of oil was spilled in rural Mercer County on Mar 5. The federal Pipeline and Hazardous Materials Safety Administration has provided the data.

Cause and Measurements

The leakage occurred due to failure of an above-ground valve. A manufacturing defect is therefore cited as the reason. To isolate the leak, upstream and downstream valves were shut down. Inspections were carried out to ensure no leakage was left in the pipeline system. The database from the above-mentioned authority confirmed that there were no leaks along the pipeline in the neighboring states of Iowa and Illinois.

Following these spilling incidents, the partnership assured that the pipeline is safe. Energy Transfer Partners is making preparations to start commercial operations from Jun 1. However, many tribes residing in Dakota fear environmental harm can be caused by this pipeline and challenged the partnership in court.

We would like to remind investors that recently the partnership had been fined $430,000 in Ohio for the Rover pipeline spills. 

About the Partnership

Energy Transfer Partners is one of the largest Master Limited Partnerships, having one of the most diversified portfolios of energy assets in the United States. The asset list includes 71,000 miles of crude oil, natural gas, natural gas liquids and refined products pipelines, crossing 36 states. It also provides fractionation, storage and terminalling facilities.  The partnership is headquartered in Dallas, TX.

Price Performance

Energy Transfer Partners, which falls under the Zacks categorized Oil and Gas - Production Pipeline - MLP industry, has seen its units lose 1.22% over last one month, compared with the broader industry’s decrease of 2.63%.

Zacks Rank and Stocks to Consider

Energy Transfer Partners presently has a Zacks Rank #4 (Sell). Some better-ranked stocks in oil and energy sector include Delek US Holdings, Inc. DK, Exterran Corp. EXTN and Canadian Natural Resources Ltd. CNQ. All of these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Delek US Holdings’ sales for the current year are expected to increase 73.24% year over year. The company recorded a positive average earnings surprise of 60.68% in the last four quarters.

Exterran Corporation’s sales for 2017 are expected to increase 25.65% year over year. The company recorded a positive earnings surprise of 123.21% in the first quarter of 2017.

Canadian Natural Resources’ sales for the current quarter are expected to increase 24.11% year over year. The company recorded a positive earnings surprise of 30.77% in the first quarter of 2017.

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