Spectra Energy is one of North America's premier natural gas
infrastructure plays. It has a strong presence in growth markets,
which should lead to value-creating investment opportunities in the
coming years. Also the recent acquisition of the Express-Platte
Pipeline System enabled the company to diversify its portfolio to a
growing market of crude oil pipeline businesses. The company's core
fee-based businesses have the potential to move the needle towards
solid earnings and cash flow growth. Management remains optimistic
on its performance going forward on the back of its expansion
program, which remains on track. With its market leading position,
diversified asset portfolio and strong investment opportunities, we
expect Spectra Energy to sustain the growth momentum. However, all
these positives have already been reflected in its valuation,
leaving little space for above-market gains. Thus our Neutral
recommendation remains unchanged at this stage.
Houston, Texas-based Spectra Energy Corporation (SE), through
its subsidiaries and equity affiliates, engages in the ownership
and operation of a portfolio of complementary natural gas-related
energy assets. The company operates in four segments: U.S.
Transmission, Distribution, Western Canada Transmission &
Processing, and Field Services. The company also has 50% ownership
in DCP Midstream, one of the largest natural gas gatherers and
processors in the U.S. In Mar 2013, the company acquired the
interest of Express-Platte Pipeline System.
The U.S. Transmission segment engages in the transportation and
storage of natural gas for customers in various regions of eastern
and southeastern United States and the Maritime Provinces in
The Distribution segment provides retail natural gas
distribution services in Ontario, Canada, as well as natural gas
transportation and storage services to other utilities and energy
market participants in Ontario, Canada and the United States.
The Western Canada Transmission & Processing segment
provides natural gas transportation, gathering, and processing
services and natural gas liquid extraction, fractionation,
transportation, storage and marketing to customers in Canada and
the northern tier of the United States.
The Field Services segment gathers and processes natural gas, as
well as fractionates, markets and trades natural gas liquids (NGL).
It engages in gathering raw natural gas through gathering systems
located in nine natural gas producing regions, consisting of the
Mid-Continent, Rocky Mountain, east Texas-north Louisiana, Barnett
Shale, Gulf Coast, South Texas, Central Texas, Antrim Shale and
Spectra Energy Corporation (SE): Read the Full
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