‘A perfect match’

Institutional capital is coming around to energy infrastructure in 2013.

Energy infrastructure is emerging as a spot-on space to park institutional wealth, with macroeconomic pressure creating ample promise for the ‘midstream’ sector of energy.

“There is a perfect match,” noted Greg Martin. Martin is chairman of Prostar Capital, a fund manager dedicated to investing in midstream, a market devoted to energy transportation and storage. Citing predictable, stable cash flows and its “long-lived” character, midstream, as an infrastructure sector, can offer “plenty of opportunity,” Martin said.

Michael Miller, partner with Highstar Capital, a $5.5 billion core infrastructure fund operator, finds midstream an ideal diversifier. “It has a stable return, as well as good downside protection,” Miller said. “With the right strategy, the right investment, it can also capture upside return”.

Miller estimated a “trillion dollars” in capital is invested in the midstream market – an assessment Peter Labbat agreed with.

“Energy infrastructure is the largest, most capital-intensive arena out there, and also the fastest-growing,” explained Labbat, a partner with Energy Capital Partners.

*To read what Martin, Miller and Labbat think about investing in energy infrastructure in 2003, please download our US Energy Supplement 2013.