August 1, 2016 Comments (0) Blog, Current Investigations

Update: Emerge Energy LP MLP Losses

(Last Updated On: October 13, 2016)

Have you suffered losses investing in Emerge Energy LP MLP? If so, the securities attorneys of The White Law Group may be able to help.

Emerge Energy Services LP is a “growth-oriented” limited partnership engaged in the businesses of mining, producing, and distributing silica sand, a key input for the hydraulic fracturing of oil and natural gas wells, according to their website. Emerge Energy also processes transmix, distributes refined motor fuels, operates bulk motor fuel storage terminals, and provides complementary fuel services.

Master Limited Partnership (MLP) is a type of limited partnership that is publicly traded. MLP’s receive the same tax benefits of a limited partnership combined with the liquidity of a publically traded security. In order to be classified as an MLP the partnership must receive 90% of its cash flow from a “qualifying source” – such as real estate, natural resources or commodities.

MLP’s are extremely complex and risky. They are only suitable for wealthy, sophisticated retail investors or institutional investors.

According to the company news release at the beginning of August, Emerge Energy reported net loss of $(22.9) million, or $(0.95) per diluted unit, for the three months ended June 30, 2016.  In addition, Emerge Energy will not make a cash distribution on its common units for the three months ended June 30, 2016.  Emerge Energy did not generate available cash to distribute for the three months ended June 30, 2016 “due to the challenging oil and natural gas frac sand market during this period”.  In addition, Emerge Energy is restricted from making distributions to its common unitholders until certain financial covenants are met under its amended credit agreement.

The White Law Group continues to investigate the liability that brokerage firms have for recommending oil and gas MLPs like Emerge Energy LP.

Brokerage firms that sell such products are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives. Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.

If you suffered losses investing in Emerge Energy LP or another MLP and would like a free consultation with a securities attorney, please call The White Law Group at 1-888-637-5510.

The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.

For more information on The White Law Group, visit www.whitesecuritieslaw.com.