MPLX's Base/Special Distribution Policy Differentiates the Partnership From Peers

We like MPLX's portfolio of refining and Appalachian-based gathering and processing assets, given the propensity for fee-for-capacity and minimum volume commitment contracts, which present a highly secure stream of income over the long run. Further, MPLX still has plenty of opportunities to unlock within its newly enlarged portfolio of assets following dropdowns from its parent and the Andeavor Logistics deal, which has taken the partnership to $5.7 billion in expected 2022 EBITDA compared with just over $550 million in 2015. Already, it has sliced billions in spending from the portfolio as 2022 growth capital spending is just $700 million from the $2.6 billion initially announced at the time of the merger, demonstrating commendable focus on unitholder returns. We expect MPLX to generate over $650 million in excess cash flow after capital spending and distributions in 2022, and the management team has prioritized unit buybacks. 2021 buybacks totaled $630 million and we expect similar capacity in 2022.