Directions(1-10): In the passage given below there are 10 blanks. Every blank has four alternative words given in options (A),(B),(C), and (D). You have to tell which word is APPROPRIATE according to the context. If all are appropriate then mark your answer as “E”.
IN 2012 Barack Obama drew attention to a boom taking place in America, linked to—but vastly overshadowed by—the country’s shale revolution. In the course of his administration, he said, “we’ve added enough new oil and gas pipeline to circle the Earth and then some.” Of course, it was not the government laying those pipes. It was an array of relatively ___1___ companies which raised money on the stockmarket to finance an infrastructure-spending spree reminiscent of the 19th-century railway boom.
Energy Transfer, a Texas-based firm that had 200 miles (320km) of pipelines in 2002, now has 71,000 miles, and will own another 33,000 after its $37.7 billion purchase of Williams, an Oklahoman firm, is completed next year. It says the ___2___ will give it a debt-plus-equity value of $141 billion, making it only a bit smaller than BP and Total, two European oil majors.
The bid for Williams, announced in September, is one of the biggest in America’s energy markets this year. But it comes as the pipeline industry is going through unprecedented turbulence. Many pipeline firms are “master limited partnerships” (MLPs). These are a ___3___ version of the conventional joint-stock company. They retain few earnings, paying most of them in dividends, which means they regularly have to raise fresh debt and equity; and they are ___4___ from income tax.
In recent months the combined market capitalisation of pipeline MLPs and other “midstream” oil and gas distributors has ___5___ by a fifth to $535 billion. Over the past year an index of listed MLPs has performed twice as badly as a basket of energy shares belonging to the S&P 500 index; for several prior years it had ___6___ them. Over a similar period the MLP index’s dividend yield has risen by three percentage points to above 8%, suggesting doubts about future payouts. On November 30th Breitburn Energy Partners, a debt-laden oil, gas and pipeline MLP, ___7___ its dividend to common shareholders. Its shares fell by a quarter.
Though not shut out of capital markets, MLPs are finding it harder to tap them. Deutsche Bank estimates that they raised $11 billion of debt and equity in the third quarter, 39% below the average quarterly amount since 2013; in October and November, they raised just $2 billion. The cost of financing is rising, too. Kinder Morgan, a Houston-based firm that helped pioneer MLPs (and spent $44 billion ___8___ them before turning into a normal company last year), said in October that the high cost of issuing new shares had forced it to look for other funding options.
Champions of the pipeline operators had argued that, since they tend to sign long-term contracts with fixed fees, they should be reasonably well insulated from any weakness in the prices of the commodities. But as American gas prices have ___9___ weak, and the global price of oil has slumped since mid-2014, worries have grown among investors that “upstream” production firms may seek to renegotiate their pipeline contracts. And as those upstream firms have scaled back their ___10___ projects, demand for new pipelines has fallen. The fewer that are laid, the harder it is for MLPs to meet a promise to investors to keep increasing their payouts. Kevin Kaiser of Hedgeye, a financial-research firm, says that retail investors, who do not fully understand the companies’ business model and were lured in by the promise of big dividends at the tail-end of the boom, are “getting completely fleeced.”
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obviousobscurepredawnphotogenicAll are CorrectOption B
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providedearthacquisitiondispositionAll are CorrectOption C
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distinctingenuousblankdistortedAll are CorrectOption D
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exempttaxableliablecondemnAll are CorrectOption A
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honorablefallenlaudedanimateAll are CorrectOption B
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excelledeclipsedoutperformedbeatenAll are CorrectOption C
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inauguratedfinishedadvancedsuspendedAll are CorrectOption D
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dividingconsolidatingcentrifugalpartibleAll are CorrectOption B
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wanderedchangedstayedveeredAll are CorrectOption C
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skimpeekpreviewexplorationAll are CorrectOption D
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