Citigroup's Favorite Energy Trusts: Enerplus Resources, Harvest

The Tories’ “Tax Fairness Plan” made it through the House of Commons, and is on its way to the Senate, where it is expected to pass into law.

Some in the oilpatch were keeping their fingers crossed, hoping the legislation would be amended to allow them to continue on as trusts. Not so.

Converting into a U.S. master limited partnership — essentially an American oil and gas royalty trust — could boost the value of some of the “high-quality trusts,” said Richard Roy, an analyst at Citigroup Global Markets.

Consolidation opportunities, favorable commodity prices and strong operations will also help unit prices.

His favorite picks are Enerplus Resources Fund (ERF) and Harvest Energy Trust (HTE). Mr. Roy likes Enerplus’ “strong development prospects” and Harvest’s reduced debt levels, among other attributes.

Comments

[User 111947:]

i currently hold shares of provident [pvx] and harvest [hte] the only fully integrated trust.

2007 Oct 09 05:43 AM