I inherited a significant amount of oil/gas pipeline MLP's back in 2011, and carry them in my taxable portfolio. These MLP's are all top tier midstream pipeline/storage companies: EPD, PAA, MWE, MMP, SEP, and the former KMP. They have been excellent investments over that time (even with the recent drop in oil, they are still up significantly), but they can also be difficult to understand from a tax perspective.
The good: They have very good yields, which can be well over 5-6%, and the tax structure allows them to kick off this income in tax advantaged ways. The midstream or pipeline MLP's are my preferred holdings, since they are somewhat insulated from the ups and downs of the oil/gas price. However, they are still investments that are intrinsically tied to commodity prices (oil/gas) and as we see now, they can drop as fast as they go up.
The Bad: When you sell or liquidate one of these partnerships, especially with large gains, they can create a huge tax hit. That's when you eventually feel it. Last year, Kinder Morgan (KMP) dissolved their partnerships and rolled these under the umbrella of their parent company, KMI. They exchanged corporate shares for partnership shares and triggered a taxable event, which created a major tax headache/pain at the end of the year for me. Kinder Morgan was up huge when they did this, and it was a real shock to total taxes due. Even with previous carry over losses I could apply to that sale, it still created a huge tax bite and was somewhat complicated to sort out. I needed my tax accountant to sort through the complexities and get it figured out to my best benefit.
I can say that from my experience, I still find them a very good, but sometimes complicated investment to understand from a tax perspective. They provide great yields, and if I were needing to shore up my energy sector holdings right now, I would certainly be looking at them to make up a portion of that sector. And as others have mentioned, stick with midstream MLP's. Just be sure you understand what you are buying into, as they are NOT your typical ETF holding.