Given the shale-play exploration and development successes of independent oil and gas operators, many wonder if upstream master limited partnerships (MLPs) will play a meaningful role in developing America’s unconventional hydrocarbon resources.

In short, yes. However, the more difficult question is, when?

Generally, MLPs are indifferent with respect to hydrocarbon-production mix and basin location. To highlight the geographic point, Memorial Production Partners LP recently closed the acquisition of long-lived offshore California oil producing assets, a first for the MLP sector.

Given MLPs distribute a substantial majority of available cash flow ...