Producers might not be ecstatic about natural gas liquids (NGL) prices at the moment, but their customers are having a better go of it as the lower prices have been a boon to the petrochemical and manufacturing industries.
You would be hard-pressed to get any U.S. or Canadian citizen to name a single other midstream project besides the Keystone XL Pipeline under development, but that doesn’t make the project the be-all/end-all of TransCanada Corp’s business strategy and operations.
Historically, waste management landfills have been the infrastructure everyone loves to hate. Today, the public has the same view concerning oil and gas drilling in the Marcellus and Utica shale formations.
It might not be a true indication that the U.S. economy is turning around, but the master limited partnership (MLP) market is definitely at its strongest level since the recession of 2008-2009. There aren’t many “sure things” in stock market trading, but investors are embracing the steady dividends that MLPs provide.
The weekend of July 6 for the surviving residents of Lac-Megantic in Quebec, Canada, is one they will never forget. About 155 miles from Montreal, the town was the site of the biggest energy transportation disaster in nearly three years.
Sometimes you need to take a step back to make up lost ground. The phrase “rebuilding year” is most associated with sports, but it turns out that it might have another home: the commodities market. While commodities don’t have a general manager or owner that will purposefully tank the season in order to accrue assets for a brighter future the way a team like the Houston Astros are performing this season, the overall outlook and impact are much the same.
The Keystone XL pipeline is likely to be passed, maybe one day soon or maybe in a year. At this point, it is anyone’s guess as to what will happen with TransCanada’s mammoth project, which is now estimated to cost a staggering $5.3 billion.
Master limited partnerships (MLP) have had a remarkable decade. In 2002, there were 20 MLPs with a total market capitalization of $20 billion. Today, there are more than100 MLPs valued at more than $400 billion. The latest energy boom will fuel more growth and increase the frequency of MLP transactions. Recent years have already witnessed a remarkable proliferation—since January 2011, there have been about 227 MLP transactions worth a combined $114.4 billion.
The shale gale is presenting many new business opportunities for producers to utilize the increased volumes. One of the companies at the forefront of this expanded use is Royal Dutch Shell, which is seeking to expand the use of liquefied natural gas (LNG) as a commercial fuel in high-horsepower applications, including rail, marine, mining, and industrial applications such as drilling rigs, fracing units, and grain drying.
The unprecedented rise in domestic crude oil production has created tremendous change for the U.S. Gulf Coast refining market, including an advantageous position for some midstream logistics companies.
Enterprise Products Partners is the largest publicly traded energy partnership, which made it very popular during the National Association of Publicly Traded Partnership’s (NAPTP) annual MLP investor conference held on May 22-23 in Stamford, Connecticut.
Since U.S. unconventional oil and gas production has grown in the past four years, one of the biggest benefits cited by its proponents has been the ability to make the country “energy independent” by stopping its “dependence on foreign oil.”
Rail transportation has become extremely important for crude producers and refiners as plays such as the Bakken shale have greatly increased production, but have limited transportation infrastructure in place.
Ten years ago, the U.S. energy industry was finalizing plans to import approximately $100 billion worth of liquefied natural gas (LNG) to make up for the rapid decline in domestic natural gas production.
The midstream has never been as fast moving, dynamic or as active as it has been in the past few years. Energy is now coming out of areas that have not traditionally been associated with it or have produced other types of hydrocarbons. As a result, the midstream has had to replace or expand current infrastructure or build new infrastructure to transport, gather, process and treat this production.
With North American oil production on the rise and global demand tapering, the price for a barrel of oil will inevitably follow a similar trend downward as did the price of natural gas as volumes rose, according to economist Peter Tertzakian. However, the fall won’t be as severe nor is it imminent, he said.
On the afternoon of March 29, ExxonMobil’s 848-mile, 20-inch Pegasus pipeline that transports up to 90,000 barrels (bbl.) of crude oil per day from Patoka, Illinois, to the Gulf Coast experienced a leak and caused the evacuation of 22 homes in the town of Mayflower, Arkansas.
As the Environmental Protection Agency (EPA) continued to impose regulations on the energy industry, it is becoming increasingly obvious that a dichotomy exists between operators and regulators who have little to no experience within the industry they are regulating.
After a relatively quiet front few years in which only one or two big announcements were made, the master limited partnership (MLP) market has gotten off to a big start in 2013 as Kinder Morgan Energy Partners announced in January that it was acquiring Copano Energy and last week CenterPoint Energy, OGE Energy and ArcLight Capital Partners announced the formation of a new midstream MLP.
U.S. liquefied natural gas (LNG) exports have been getting a lot of attention in the past few years as LNG import terminals seek to reverse course to compensate for an oversupply of natural gas from shale plays. What has been less detailed has been the development of domestic liquefied petroleum gas (LPG) export projects to send out excess propane and butane.
John Kerry may have lost the U.S. Presidential election in 2004, but the Secretary of State has been tasked with making a decision that the White House had previously stated would be made by the President.
As the North American crude market has experienced a renaissance, thanks to the unconventional development revolution, Enbridge Energy Partners has been one of the largest beneficiaries in this change in market dynamics.
The shale gas revolution hasn’t just helped support and renew local economies; it also helped the U.S. avoid falling over the fiscal cliff last year, according to Rick Cargile, president, midstream, Energy Transfer Partners (ETP).
January is usually a pretty quiet month when it comes to acquisitions, but Kinder Morgan Energy Partners (KMP) started 2013 with a bang by announcing they had reached an agreement to acquire Copano Energy for approximately $5 billion.
Despite an economic downturn, the master limited partnership (MLP) sector was able to outperform the overall stock market from 2009 through 2011, due to its heavy focus on energy, and, the midstream, in particular.
Industrial demand for natural gas could grow by 1 billion cubic feet per day (Bcf/d) over the next three years as an avalanche of industrial plants expand capacity expansion, said Barclays Capital analyst Biliana Pehlivanova.
ExxonMobil executives said that energy demand and resource diversity will grow throughout the next 30 years. According to the company’s vice president of corporate strategic planning, William Colton, global demand for energy will increase by 35% by 2040.
Williams announced it has agreed to acquire a 50% interest in privately held Access GP and approximately 25% of the limited partner units of Access Midstream Partners LP for approximately $2.4 billion. ACMP announced plans today to acquire most of Chesapeake Energy Corp.'s remaining natural gas and crude-oil gathering assets for $2.16 billion.
Natural gas markets have experienced a particularly rough 2012 as a warm winter reduced heating demand in much of North America. Prices faced further headwinds as shale gas production remained high, which increased storage levels.
Hart Energy’s Frank Nieto sat down with former deputy chief of staff and senior advisor to President George W. Bush, Karl Rove at the DUG East conference in Pittsburgh, Pennsylvania, to get “the architect’s” thoughts on the election’s impact on the energy industry.
The long road to development for the Keystone XL Pipeline is expected to finally end in the first quarter of 2013, as TransCanada Corp. officials anticipate that the U.S. Department of State will formally award the project a Presidential Permit.
The centers of power and fuel in the East Coast — including several refineries, ports and pipelines — were brought to a standstill Oct. 30 as Hurricane Sandy whipped through the region, slashing New York and New Jersey with 90 mph gusts.
In the last half decade, the United States, once a net importer of natural gas, is now on the threshold of becoming a major exporter of liquefied natural gas (LNG). In the early part of the 21st century, companies began building LNG import terminals in advance of an expected decline in natural gas production.
DCP Midstream's van Kempen: Company Will Continue Focus On Liquids Wouter van Kempen, who was recently promoted to the position of president and chief operating officer at DCP Midstream, said that he plans to continue the company’s strategy of focusing on its footprint in liquids-rich plays.
In an effort to better reflect the logistics in the midstream industry and identify the real players in this sector, Midstream Monitor altered its reporting criteria for our annual rankings of the top natural gas processors and natural gas liquids (NGL) producers. In the past, we have based our rankings on first-party processing and production volumes.
It has been known for some time that many of the prolific plays throughout the U.S. are in need of immediate infrastructure attention, especially in the bountiful Bakken, where a surge in production has caused more than its fair share of challenges.
The U.S. oil and gas industry is in the midst of a renaissance – for the first time since the Truman administration the U.S. became a net exporter of gasoline and diesel. As this renaissance continues to grow, the industry is creating more jobs, yet energy hasn’t been a large focus in this presidential campaign.
Former House Speaker and Republican presidential candidate Newt Gingrich, watching the failed attempt of the Congressional Super Committee last year to find an additional $1.5 trillion in debt savings over 10 years, pondered the possibility that oil and gas development might be a solution offering long-term national security benefits. He also recognized the fact that the federal government holds mineral rights to 279 million acres.
It was expected that ethane demand from petrochemical producers would be down much of the first half of this year due to the scheduled turnaround for many of the Gulf Coast’s ethane crackers. What wasn’t expected was that when these facilities came back online in May and June that demand would remain stagnant, but that is what happened.
As the summer season began to come to close, there was a mini revival for Conway natural gas liquids (NGL) prices as producers began to find a market for their products by transporting them out of the region to the Gulf Coast and Canada.
Production of gas and liquids has increased significantly in the past five years as production has shifted from conventional resources to unconventional resources, but production could be even greater except for delays in midstream infrastructure build out.
The second quarter of 2012 saw Chesapeake Energy Corp. take a large step out of the midstream through the $2 billion sale of Chesapeake Midstream Partners (now Access Midstream Partners) MLP to Global Infrastructure Partners (GIP).
If there is one major takeaway from the winter of 2011-2012 it is that just as cold weather can drive natural gas and natural gas liquids (NGL) prices up, a warm winter can drive those price down just as fast.
Midstream operators seeking to make long-term moves have had a rough time of it in the past few years as production shifts have happened at an extremely fast pace. In 2009 it appeared that even with production from unconventional natural gas plays, volumes from the North Slope of Alaska would be needed in the Lower 48 states.
During the past two years, M&A deal value in the U.S. oil and gas industry has mostly been driven by shale transactions in the upstream sector. But during the second quarter of 2012, that trend dissolved as
midstream deals sizzled, according to a report by PwC US.
It is likely that natural gas liquids (NGL) prices have hit their low point for the year, but don’t expect a sudden price surge given the amount of transportation coming out of Conway in 2013, according to Tudor, Pickering, Holt & Co. (TPH).
Petral Worldwide co-founder James Cutler’s vast experience in the industry has given him a unique perspective on the industry and some recent developments. One in particular is the push for a world-scale ethylene plant -- capable of cracking approximately 2 billion pounds of ethane per year, which requires about 60,000 barrels per day of ethane feedstock -- in the Northeast to crack ethane production out of the Appalachian basin.
The forward natural gas liquid (NGL) market continues to grow bleaker as storage levels rise and demand falls. Due to these factors, Wells Fargo altered its Mont Belvieu forward pricing estimates for NGLs from $1.28 per gallon (/gal) to 99¢/gal in the second half of 2012 and from $1.29/gal to $1.05/gal in 2013.
There is a perception that natural gas liquids production is at complete odds with natural gas production, but this isn’t really the case as NGLs are helping a natural price recovery, Peter Howard, president and chief executive of the Canadian Energy Research Institute (CERI), said at last week’s DUG Canada conference in Calgary.
While producers are understandably downbeat about where oil and gas prices are, these prices are a signal that the free market continues to work, said Peter Tertzakian, chief economist at ARC Financial Corp., during his lunch keynote at DUG Canada in Calgary earlier this week.
While natural gas liquids have been the saving grace in the past year for producers that have struggled with extremely low gas prices, a Bernstein Research group report suggests that the party may be coming to an end.
While primarily directed at Wall Street and mortgage lending reform, the Dodd-Frank Act is likely to have a significant impact on the oil and gas industries due to the legislation’s initiatives to empower the U.S. Commodity Futures Trading Commission (CFTC).
Kinder Morgan Inc. (NYSE: KMI) completed its acquisition of El Paso Corp. (NYSE: EP), which was announced in October of 2011. Combining the two companies makes Kinder Morgan the largest midstream and the fourth largest energy company (based on combined enterprise value) in North America.
Enterprise Products Partners L.P. (NYSE: EPD) and Enbridge Inc. (NYSE/TSX: ENB) announced that modifications to the Seaway crude oil pipeline allowing it to transport crude oil from Cushing, Oklahoma to the U.S. Gulf Coast have been completed.
The shale gas revolution has already had a major impact on the power generation, petrochemical and heating and cooling industries. Now it is poised to have a similar impact on the transportation industry because of the tremendous price discrepancy between gasoline and natural gas.
As Eagle Ford shale production continues to increase, it is hastening the need for midstream infrastructure development in the play. “The pace of reserve development in the Eagle Ford is challenging producers, midstream service providers, and
Three major shocks have roiled the world in the past decade or so: the 9/11 attack, the global financial crisis, and Arab Spring, said Dr. Condoleezza Rice, former U.S. Secretary of State, speaking at Hart Energy's DUG Conference & Exhibition in Fort Worth.
The Dow Chemical Company (NYSE: DOW) will construct a new $1.7 billion world-scale ethylene production plant at Dow Texas Operations in Freeport, TX, as part of Dow's previously announced comprehensive plan to further connect its U.S. operations with cost-advantaged feedstocks available from increasing supplies of U.S. shale gas.
Enterprise Products Partners LP (NYSE: EPD), Anadarko Petroleum Corp. (NYSE: APC) and DCP Midstream LLC announced a joint venture to build the 435-mile Front Range natural gas liquids (NGL) pipeline in the DJ basin. The partners will each hold a one-third interest in the pipeline, which will run from Weld County, Colo. to Skellytown, Texas.
The midstream industry has been able to quickly respond to many of the demand needs that the E&P industry may face in the Marcellus and Utica shales, potentially avoiding many of the constraints now facing producers in the Mid-Continent.
Chesapeake Midstream Development, a wholly owned subsidiary of Chesapeake Energy Corp. (NYSE: CHK), announced it is partnering with M3 Midstream LLC and EV Energy Partners LP (NASDAQ: EVEP) to build a $900 million midstream service complex to serve producers in the Utica shale.
MarkWest Utica EMG LLC, a joint venture
between MarkWest Energy Partners LP (NYSE: MWE) and The Energy and Minerals Group, signed a letter of intent with Gulfport Energy Corp. (NASDAQ: GPOR) to develop gathering, processing, fractionation and marketing services in the liquids-rich portion of the Utica shale.
Cheniere Energy Partners, L.P. (NYSE Amex: CQP) entered into an exclusive arrangement with Blackstone Energy Partners L.P., Blackstone Capital Partners VI L.P., and certain affiliates to finalize and execute definitive agreements under which Blackstone would purchase newly issued CQP Senior Subordinated Paid-in-Kind Units for $2 billion.
TEAK Midstream LLC announced it will spend $280 million to build the 200 million cubic feet per day (MMcf/d) Silver Oak cryogenic gas processing plant along with a new natural gas gathering and residue delivery system that will run more than 200 miles and will transport volumes from the Eagle Ford shale.
Energy Transfer Partners LP (NYSE: ETP) and Regency Energy Partners LP (NYSE: RGP) announced their Lone Star NGL LLC joint venture will build a second 100,000 barrels per day (b/d) NGL fractionator at Mont Belvieu, Texas.
The race to secure an ethane cracker in the Marcellus/Utica shale region of the country continues to heat up as a bill was passed on Feb. 8 in the Pennsylvania state legislature that would utilize a portion of the fees collected from each unconventional gas well in the Commonwealth to fund the development of an ethane cracker.
Though we’re one month into 2012, there are still quite a bit of uncertainties when it comes to energy prices. Can oil maintain or surpass the $100 per barrel (/bbl) threshold? Have gas prices hit their floor and can they recover in the next 11 months? Can liquids continue their winning streak?
Natural gas production should remain at roughly the same level as in 2011, but there could be a pullback by producers in 2013 because of the continued decline in the forward pricing curve, according to Barclays Capital.
NGL prices began to regain strength in 2011, most notably heavy NGLs and Mont Belvieu ethane. However, as the year drew to a close propane prices lost much of their gains from the previous 12 months and the Conway market was feeling the negative effects from transportation bottlenecks and an oversaturated market.
Although many pundits have focused on job growth from shale gas directly coming from the energy industry and construction affiliated with it, one of the biggest beneficiaries of the shale gas revolution could be the U.S. manufacturing industry, according to a recent report developed by PwC.
Despite a natural gas market that remained depressed in 2011, the production of natural gas remained high. While this can partially be attributed to producers drilling to retain land leases, Barclays Capital reported that drilling budgets are no longer as vulnerable to weak natural gas prices because of strong prices for associated liquids.
Although there are some headwinds facing the midstream industry the positives outweigh the negatives according to David Lundberg, analytical manager for Standard & Poor's midstream energy and MLP team, as he points to a strong outlook for the industry in 2012.
Republicans in the House of Representatives are not giving up on gaining approval for TransCanada's Keystone XL pipeline prior to 2013. On Dec. 2, Rep. Lee Terry (R-Neb.) introduced a bill that would extend payroll tax cuts and unemployment benefits that includes a provision that would place the decision on the pipeline in the hands of the Federal Energy Regulatory Commission (FERC) rather than the State Department.
It turns out that discovering how to produce the vast amount of natural gas out of the Marcellus shale wasn’t the hardest part. Instead, it was discovering how to handle all of the ethane out of the play.
While Enbridge Energy Partners LP's total natural gas volumes increased in Q3 2011, the company anticipates reaping further growth in 2012. The company's volumes increased to 2.8 billion cubic feet per day (Bcf/d) in Q3 2011 from 2.4 Bcf/d in the same quarter last year due to the acquisition of the Elk City gathering and processing system and increased volumes on its Anadarko and East Texas systems.
Enterprise Products Partners LP (NYSE: EPD) secured long-term contracts for more than 75% of the initial capacity on its proposed Marcellus and Utica shale ethane pipeline with Chesapeake Energy Corp. (NYSE: CHK) serving as the pipeline’s anchor.
Last month, the U.S. Senate passed the Pipeline Transportation Safety Improvement Act of 2011 (S. 275) in an effort to improve the safety of the nation's natural gas pipelines following several high profile leaks and explosions involving gas pipelines last year.
This is an exciting time for the energy industry with the advent of shale plays and development of new alternative sources of energy, but there are still problems hounding the industry. These range from infighting to price speculation among other ills, according to Raymond J. Learsy, a former commodities trader, private investor, and author of Oil and Finance: The Epic Corruption.
Speaking at this week’s DUG Eagle Ford conference in San Antonio, several midstream operators said that infrastructure will be built to handle the increasing production out of the Eagle Ford shale, but stated that producers must be patient while issues are resolved.
Last week, DCP Midstream retained its ranking as the Top NGL Producer in Midstream Monitor’s annual rankings. This marked the fourth consecutive year that the company achieved this ranking, largely because of its positioning in the top basins in America.
Midstream Monitor and Midstream Business are proud to present our annual rankings of the Top Gas Processors and Top NGL Producers for 2010. For the fourth straight year ExxonMobil was the top processor and DCP Midstream was the top NGL producer in the rankings (which were previously compiled in Gas Processors Report). Midstream was the top NGL producer in the rankings (which were previously compiled
in Gas Processors Report).
While Devon Energy’s primary focus is in E&P, the company’s midstream division is a very important and profitable segment of the company. “We produce somewhere around 250 million barrels per year, so that adds a couple of dollars per barrel on our net back. It’s a very, very profitable business for us,” John Richels, president and chief executive of Devon, said at the recent Barclays CEP Energy Power Conference in New York.
The advent of shale plays in North America has brought natural gas and oil exploration to parts of the continent where both the E&P and midstream industries have never been before. This has required a lot of new infrastructure build-out and caused bottlenecks in various regions.
Propane supplies will be better balanced in 2012 than they were in 2011 with a nearly 3% increase, according to Wells Fargo’s August 2011 NGL Snapshot. This increase will be mainly supported by increased natural gas processing capacity in Mont Belvieu and an increased focus on developing liquids rich plays.
As operators add more pipeline capacity out of the Marcellus and Utica shales, the importance of maintaining the safety of these pipelines is also increasing because of the potential for lawsuits in these plays. Already hydraulic fracturing and GHG emissions, along with other activities and processes related to the production and transportation of gas and liquids out of these plays, have generated litigation against the industry.
The continued after-effects of the Japanese
nuclear fuel reactor leaks this past
spring have had at least one positive effect-
-they’re boosting the stock prices of global
liquefied natural gas, according to experts.
Royal Dutch Shell Plc fraced half of the
Marcellus wet-gas conundrum at press
time, announcing it will build a 60,000- to
80,000-barrel-a-day ethane cracker. And,
no big transportation deal is necessary: It
will build it right there in Appalachia, in
the midst of hundreds, and soon to be thousands,
of 1,400-plus Btu wells.
Chesapeake Energy Corp. remains one of
North America’s largest natural gas and
liquids producers with significant holdings
in the most prolific basins on the continent,
and the company continues to eye growing
liquids plays for future growth.
The production of natural gas liquids (NGL)
in the Permian Basin in West Texas and
southeast New Mexico is likely to be constrained
though 2012, but pipeline projects
should help relieve some of the bottlenecks
by 2013, according to Wells Fargo Securities’
“NGL Snapshot” report that was released in
The midstream sector, which has historically
received less investor interest than E&P and
oilfield services, is in the middle of an unprecedented
transformation brought about
by a revolution in North American unconventional
resource development, according
to a study by Houston-based Tudor, Pickering,
Holt & Co. Securities Inc.
The midstream sector has experienced quite
a turnaround in the past several years, moving
from a lack of access to capital in 2008-
2009 to the current period in which there
has been a tremendous injection of capital
into the market.
In anticipation of the release of its North
American NGL study next month, IHS CERA
held a webinar, “Rebalancing NGLs in an
Unconventional North America,” to discuss
several findings of the study. Much of the
report will focus on how the marketplace is
expected to handle increased volumes from
liquids-rich shale plays.
At last month’s annual analyst meeting, El
Paso Corp.’s Chairman, President and Chief
Executive Doug Foshee highlighted the company’s
return to strength in the eight years
from the collapse of the energy merchants
industry to today.
As activity in the Marcellus shale has ramped
up so has litigation related to hydraulic fracturing,
infrastructure construction, leasing
issues and disputes related to mineral rights,
according to Karen Kahle, who heads Steptoe
& Johnson’s class-action and mass-tort team.
The U.S. Department of State is currently reviewing
an application from TransCanada to
build the Keystone XL pipeline to transport
oil sands output from Alberta, Canada, to the
Gulf Coast. A recent report from IHS CERA
stated that if the U.S. government rejects the
project, it would potentially harm U.S.-Canada
relations and leave the U.S. more reliant
on distant oil supplies.
While there is no question that ethylene
production capacity will increase during the
next few years, given the number of projects
that have been announced, the question is
how much will capacity increase and which
projects are likely to see the light of day.
The midstream industry continues to benefit
from large production increases from the
development of the shale plays. This added
production, much of it coming from new
areas without much infrastructure, has led
to a large ramp-up in midstream infrastructure
While many people, not just industry insiders,
are high on the role of shale gas in the
long-term energy plans of the U.S., noted energy
market expert Dale Nesbitt put a bit of a
damper on this future at last week’s 2011 Deloitte
Energy Conference in Washington, D.C.
Hart Energy’s 6th annual DUG conference,
recently in Fort Worth, Texas, Bush engaged
nearly 2,400 attendees during a special
luncheon with a frank and sometimes
humorous speech on the reasons behind
his recent memoir, his presidency, and his
outlook for energy.
It is becoming more apparent that the Environmental Protection Agency (EPA) does indeed plan on acting on its previous warnings that it would attempt to regulate greenhouse gas (GHG) emissions through the Clean Air Act if Congress failed to enact legislation to do the same.
The first Gas Plant in a Bottle™ (GPB™) is scheduled to be installed in south Texas later this year. Developed by Ortloff Engineers Ltd. and SME Products, L.P. to reduce the cost, emissions and plot space necessary for gas processing plants, this new process and equipment design is able to place nearly all of the processing equipment in a typical cryogenic gas plant inside a single vertical tower.
“The oil and gas extraction industries are very much under attack today,” Dr. Loren Scott said during his keynote speech at the Gas Processors Association’s (GPA) 90th Annual Convention in San Antonio, Texas, while discussing the outlook for the oil and natural gas industries in 2011-12.
Rep. Bill Schuster (R-PA) spoke last week at Hart Energy’s Marcellus Midstream Conference in Pittsburgh, Pa. about why regulating the natural gas industry should remain in the hands of the Pennsylvania Department of Environmental Protection (DEP) – and not the federal government – to ensure the fastest and safest development the Marcellus shale.
Nowhere is the economic rebound in the midstream industry more obvious than with the market for master limited partnerships (MLP), which have returned to their pre-collapse performances and are expected to continue to grow.
Advances in recovery of unconventional gas resources, especially in shale plays, are expected to make natural gas the preferred energy source in coming years, according to Energy Vision 2011, a report published by the World Economic Forum in partnership with IHS Cambridge Energy Research Associates.
It's been a busy few years for Alan Armstrong, the new CEO of Williams Co., a position he assumed at the start of this year, after serving as president of the company's midstream business where he was responsible for Williams' midstream activities in the United States and Canada.
There has been increased speculation about whether the suc- cess of shale gas in North America, where production has grown to 12 billion cubic feet per day (Bcf/d) by the end of 2010, can be replicated in other parts of the world.
Interest in shale gas plays was a major driver for the U.S. oil and gas industry’s M&A (mergers and acquisitions) ac- tivity outpacing the overall U.S. market in 2010, according to a recent report from PwC’s U.S. Energy Practice.
As producers continue to focus on liquids-rich plays, DCP Midstream LLC remains in a strong position as the com- pany adds to its already large presence in the Eagle Ford and other liquids-rich plays as it aims to build a super-system in the play.
As producers continue to move more rigs away from dry gas plays to liquids-rich plays due to the significant price differ- entials, gas processors and other midstream companies aren’t the only ones standing to benefit from the switch.
Rather than increasing costs for U.S. natural gas and oil producers through increased taxes and regulatory costs, the United States government should be improving access to domestic oil and gas reserves to improve the economy, ac- cording to Jack Gerard, president and CEO of the American Petroleum Institute (API).
After dropping across the board in mid-2010, natural gas liquids (NGL) prices finished on a high to close out 2010 as stronger demand for heavy liquids and tightened supplies helped to push butane, iso-butane and C5+ prices to their highest levels in well over a year.
Historically natural gas prices have been subject to volatility from heating and cooling demand, as well as due to tightened balances, but over much of the past decade prices have traded in a tighter range, due to increased production among other factors. Given this situation, a recent Natural Gas Weekly Kaleidoscope from Barclays Capital questioned whether pricing volatility was dead.
The biggest opportunity to lower CO2 emissions is by changing the way in which electricity is generated and the biggest opportunity for this is through the combination of renewables and natural gas, according to Worldwatch Institute’s “Powering the Low-Carbon Economy: The Once and Future Roles of Renewable Energy and Natural Gas” report authored by Saya Kitasei
Judging by the message sent by voters in the mid-term elections last month, climate change legislation is likely to be on the backburner for awhile. This would seemingly work against the argument to displace coal-fired power plants with natural gas-fired plants, but with natural gas prices remaining low there is an economic advantage to be found in doing so.
“The widening crude oil-to-natural gas ratio has really changed the game in the NGL (natural gas liquids) industry,” Michael Blum, managing director of equity research at Wells Fargo Securities said at this month’s DUG East conference in Pittsburgh, Pa.
“When we look at the midstream landscape, there really are two avenues for growth and opportunities. The first is most specific to the Marcellus and other shale plays and that’s greenfield development … the other avenue is acquisition of existing assets,” Mark Honeybone, a partner in private-equity firm Energy Spectrum Capital, said while speaking at Hart Energy Publishing’s DUG East Marcellus Midstream Workshop in Pittsburgh, Pa., last week.
Industry worries over Congressional legislation of climate change and hydraulic fracturing are a thing of the past based on this week’s U.S. mid-term elections, according to Karl Rove, who spoke at Hart Energy Publishing’s DUG East Conference in Pittsburgh, Pa., last week.
Kinder Morgan updated the status of its Fayetteville Express Pipeline during its recent conference call to discuss its third quarter 2010 earnings, stating that the 185-mile pipeline is now complete and in-service.
Investors take note: the era of booking the latest and greatest shale discovery will likely give way to an age of consolidation in already existing plays, according to comments made by Chesapeake Energy Corp.'s chief executive Aubrey McClendon during the company's annual investor meeting October 13.
There is good news and bad news for natural gas prices forecast for next year – the good news is that unless European prices drastically fall below U.S. by 30¢ to 50¢ per million Btu (/MMBtu) than liquefied natural gas (LNG) will continue to be shipped to Europe, South America and the Middle East over U.S. markets.
The tremendous increase in North American natural gas production that began in 2007 with the development of unconventional shale plays, along with the global economic recession, caused significant changes not just in the North American natural gas market, but the global gas market.
“We have to understand supply and demand better than anybody else and look for the opportunities to connect supply with demand and vice versa and collect a few for that service,” John Gibson, president and CEO of ONEOK Partners, said when asked at the recent Barclays Capital CEO Energy Conference in New York City about the challenges the company faces in dealing with increased ethane production.
Hydraulic fracturing has been in the news a lot this past year since the U.S. Environmental Protection Agency announced it would study any effects that “fracking” has on the environment. This past week the EPA held two public hearings on the practice in Binghamton, New York, which has postponed drilling rights in its section of the Marcellus shale as it studies the effects fracking could have on the state’s waterways.
Spectra Energy’s CFO Pat Reddy highlights the company’s asset base as enabling the company to continue to grow relatively inexpensively compared to the growth rate in the coming years. Speaking at this week’s Bank of America Merrill Lynch Investment Conference in San Francisco, Calif., Reddy said that the company’s asset base forms the company’s foundation for the future and would be impossible to duplicate today.
For the past several months producers such as Chesapeake Energy and EOG Resources have been switching their focus further from natural gas production to production of liquids (see Gas Processors Report 05/11/10; 08/31/10) due to the price differential offered between the products that favor liquids.
The U.S. rig count rose by 47% in August to almost 1,000 compared to the 672 rigs in July 2009, primarily due to horizontal drilling in shale plays by independent operators with much of this increase focused on liquids-rich plays such as the Eagle Ford, according to a recent Natural Gas Weekly Kaleidoscope report from Barclays Capital.
When we last sat down to speak with Crestwood’s Bob Phillips the company was just starting out and the midstream market was at its peak. Since then, the credit crunch and changes in the market caused the company to re-evaluate its strategy.
Frank Semple, MarkWest Energy Partners’ chairman, president and CEO, highlighted the company’s diverse asset base in some of the country’s strongest plays as the primary driver of the company’s growth in the second quarter of 2010 which saw the company post US$73 million in earnings and $102 million in operating income.
For the third straight year DCP Midstream topped Gas Processors Report’s (GPR) annual rankings for the top natural gas liquids (NGL) producer with ExxonMobil also topping GPR’s annual rankings for the top natural gas processor for the third consecutive year.
Like many other midstream companies, DCP Midstream has been more active with liquids than with gas this past year due to the discrepancy between natural gas liquids and natural gas prices. But the company’s size and asset base has allowed it to focus more on a section of its assets rather than having to build up new projects.
As producers continue to gravitate towards more liquids rich plays to capitalize on the greater profits offered by natural gas liquids and refined products over natural gas, integrated midstream companies such as Enterprise Products Partners are continuing to benefit from this focus.
The current oversupply in the global natural gas market combined with a worldwide recession has given the impression to not just consumers, but also the European energy industry that there isn’t a real incentive or need for additional gas storage capacity, but this sentiment is shortsighted -On Gas Storage UK’s managing director, Jo Vizor, said at last month’s SMi Gas Storage conference in London.
The natural gas market will remain oversupplied with storage levels remaining full over the next two years due to the inability of the market to respond to price signals and adjust supply and demand, according to Barclays Capital’s Natural Gas Weekly Kaleidoscope.
While the U.S. natural gas markets are beginning to feel the effects of a growing gas market that is increasingly becoming more global in scope, the European gas markets have been undergoing their own changes.
As natural gas becomes a more popular energy source in Europe and Asia, the liquefied natural gas market has been changing to meet this increased demand with both more supply and import regions opening up.
Politicians and the general public are beginning to grasp the reality that a move away from fossil fuels towards “green” energy sources such as renewables will not come any time soon and that an increase in usage of cleaner bridge fuels such as natural gas will be necessary to reach this destination.
While natural gas prices will remain depressed in the short term, the market for natural gas should be strong in the future due to its abundant supply and the continuing global political pressure to utilize it over other competing products such as coal, according to a panel discussion held at the Argyle Executive Forum’s recent 2010 Leadership in Oil and Gas conference in Houston.
The Pennsylvania State University released a study this week that found that the Marcellus shale has the potential to become the second-largest natural gas field in the world behind only the South Pars/Asalouyeh field between Iran and Qatar and bring the state of Pennsylvania an estimated US$18.9 billion in additional revenue by 2020.
This week Gas Processors Report spoke with both Kelcy Warren, chief executive officer and chairman of Energy Transfer Partners (ETP) and chairman of Energy Transfer Equity (ETE), and Byron Kelley, president, chief executive officer and chairman of Regency Energy Partners LP, about last week’s announcement that ETE was buying Regency’s general partner (GP) along with Regency acquiring a 49.9% interest in the Midcontinent Express pipeline (MEP) (see Gas Processors Report 5/13/10).
Senators John Kerry (D-Mass) and Joe Lieberman (I-Conn) introduced The American Power Act, an energy/climate change bill into the U.S. Senate yesterday. The bill is designed to combine many of the various provisions found in earlier legislation in both the House and Senate as well as coax enough Republican votes to ensure passage in the Senate.
U.S. gas markets will benefit from higher crude oil prices, as European and Asian markets will offer more attractive pricing for liquefied natural gas (LNG) than the U.S., according to a new report from Tudor, Pickering, Holt & Co. (TPH).
One of the largest and most successful partnerships in the Marcellus shale is between MarkWest Energy Partners LP and Range Resources Corp. in which MarkWest agreed to build pipeline and processing infrastructure in the play to support Range’s, and others, production efforts. Executives from both companies were on hand at this week’s Marcellus Midstream Conference.
Kinder Morgan Energy Partners LP made a big splash in the Haynesville shale this week as the company announced that it was forming a joint venture (JV) with Petrohawk called KinderHawk Field Services that will be the largest gathering and midstream business in the play.
Gas Processors Report attended a tour of DCP Midstream LLC’s Giddings, Texas, natural gas processing plant that was recently held in conjunction with the 89th Annual Gas Processors Association Convention.
There are many aspects of the energy and climate change debates that are taken as fact: we want energy, we want renewable energy, wind energy is "green," and we are using too much oil. All of these are false, said Robert Bryce, who gave the keynote speech at the 89th Annual Gas Processors Association Convention in Austin last week.
Looking back on his term as president of the Gas Processors Association (GPA), Bob Dunn said that the top achievements made by GPA during his tenure were in the fields of advocacy as well as continuing to grow its membership from its traditional gas processing base.
“A big part of our federal efforts have been on the education process because as much as 85% of our NGLs [natural gas liquids] are never combusted, so they never have any type of emission,” Gas Processors Association’s director of government affairs, Jeff Applekamp, told Gas Processors Report, explaining why marking processors as a point of regulation never made sense.
A move by Russian integrated energy company Gazprom to tie a portion of its sales of natural gas in Europe to spot prices may see increased liquefied natural gas (LNG) imports enter a recently oversupplied U.S. market, according to Barclays Capital’s Natural Gas Weekly Kaleidoscope’s "Pushing Russian Gas into the U.S."
A new study found that the continued moratoria on exploration of federal lands will result in the U.S. GDP (gross domestic product) decreasing by a cumulative US$2.36 trillion, or roughly 0.52% annually, from the period of 2009 to 2030.
Chevron Corp.’s results for the fourth quarter of 2009 were highlighted by a 7% growth in production for 2009 compared to 2008 due to major projects coming online that added 450,000 barrels in net production in oil and gas, and the company’s focus on its key components during the current economic downturn that are designed to increase both growth and returns.
As the price of oil begins to make a steady climb back toward the $US80-per-barrel mark seen a few weeks ago, rig counts rise in the United States to more than 37% since the middle of last year, exploration and production spending is on the rise roughly 10% and hydrocarbon demand is expected to increase to levels seen in 2007, more countries are expected to step up to the recovery efforts.
The House Subcommittee on Energy and Environment seemingly gave the nod to the proposed US$41 billion merger between ExxonMobil and XTO Energy. The main topic of discussion was on possible hydraulic fracturing legislation, which could trigger an exit clause on ExxonMobil’s behalf should it prove too costly.
As the public funding for midstream projects continues to dry up, a host of private equity-funded companies have been entering the sector. One of the most interesting and aggressive is Caiman Energy, led by Jack Lafield and Danny Thompson, recently of Crosstex Energy, and Rick Moncrief, late of Regency Energy.
Chesapeake Energy continued to increase liquidity and finance future drilling and completion costs in what it calls the Big 4 shales by reaching a $2.25 billion agreement to sell a 25% interest in its Barnett production assets to France’s Total.
After months of speculation, the U.S. Environmental Protection Agency (EPA) announced they will seek to curb greenhouse gas (GHG) emissions in the U.S. through the Clean Air Act, stating that such emissions endanger the lives of U.S. citizens.
Barry Davis, chairman, president and chief executive officer of Cross- tex Energy Inc. said during a confer- ence call to discuss the company’s third-quarter earnings that his company is poised to capitalize on the upswing being felt in the industry of late.
Long before the terms “hybrid vehi- cle” and “alternative fuels” were part of the American lexicon, Rich Kolodziej was seeking to advance the use of natu- ral gas vehicles (NGVs) since he was named as president of the NGV Amer- ica in 1995.
While many midstream companies are maintaining a long-term commit- ment to the Barnett shale, the formation has given up its status as the “hot play” to both the Haynesville and Marcellus in the eyes of many industry players.
Washington – Royal Dutch Shell CEO Peter V oser heavily praised the future of natural gas and the role it will play not just in the world energy mar- ket but in the company itself, when he spoke at the Woodrow Wilson Center in Washington, DC last week.
British Columbia’s Horn River basin has more potential than the Barnett shale, IP rates on par with the Haynes- ville and a supportive government that will enable the play to compete with both and others in the Lower 48 states, according to a Barclays Capital report, “Horn River Basin: An Emerging Shale Play.”
Sen. Barbara Boxer (D-Calif.), chair of the U.S. Senate Environment and Public Works Committee, and Sen. John Kerry (D-Mass.), chair of the For- eign Relations Committee, released a draft yesterday that was designed to form a framework for the Senate’s ver- sion of climate change legislation.
Regency Energy Partners LP began construction on a plan to expand its Nexus gathering system in the North Louisiana section of the Haynesville via a US$44 million pipeline expansion that will add 300 million cubic feet per day of natural gas capacity.
A recent research report from Barclays Capital, “Energy
Focus: A shrinking role for gas-fired generation?,” states that the future of gas-fired power plants isn’t as certain as much as people think it is.
Natural gas producers and processors may get some victories out of this U.S. congressional year, as it is unlikely that national legislation regulating hydraulic fracturing or implementing a carbon cap-and-trade system will pass into law according to a Washington insider with whom Gas Processors Report spoke.
Earlier this month, Delphi Midstream Partners LLC announced it had received an equity commitment from American Securities to support up to US$2 billion in investment and acquisition opportunities in the midstream energy sector.
Officials from the U.S. Commodity Futures Trading Commission (CFTC) are considering ways to create more oversight and limits in the trading of exchange-traded funds (ETF) in order to establish more transparency in the marketplace.
Enterprise Product Partners’ adjusted earnings in Q2 2009 were down US$4 million due to general and administrative expenses associated with its proposed merger with TEPPCO, which was formerly announced at the start of the third quarter, along with $46 million in nonrecurring items.
Despite the continuing economic downturn, Kinder Morgan Energy Partners LP officials were happy with their second quarter 2009 results, as the results exceeded executives’ expectations for the quarter. Additionally, officials stated that the company’s divisions were on track to exceed their earnings and distributable cash, year-on-year.
This year has been a busy one for those involved in legislative advocacy in the energy industry, but not many can claim to have been busier than Johnny Dreyer, corporate secretary and director of industry affairs for the Gas Processors Association (GPA).
Enterprise Products Partners and TEPPCO Partners announced a $3.3 billion stock-for-stock agreement to merge under the Enterprise name into the largest publicly traded energy master limited partnership and largest pipeline partnership, with an estimated valuation of more than $26 billion.
For the second straight year, Gas Processors Report compiled its rankings for the top NGL producers and the top gas processors in the United States and for the second straight year, DCP Midstream topped the NGL list and ExxonMobil came in first in the gas processors list.
Crosstex Energy LP signed a definitive agreement to sell its assets in Mississippi, Alabama and South Texas to Southcross Energy LLC for $220 million by the end of July in order to pay down its outstanding debt, which is over $200 million.
As expected, the House Energy and Commerce Committee passed the American Clean Energy and Security Act (GPR 5/20/09), which would create a national cap-and-trade index in order to reduce greenhouse gas (GHG) emissions.
Chesapeake Energy’s chairman and CEO Aubrey McClendon stated during a conference call to discuss Q1 earnings that natural gas prices are too low and that the market will not sustain such levels for long.
Washington, D.C. – There was a consensus by the speakers at the Financial Markets and Short-Term Energy Prices session at last week’s Energy Information Administration’s annual conference that last year’s run-up on oil and prices was not caused by speculators.
Washington, D.C. – The consensus from the panel that discussed the future of natural gas markets at the Energy Information Administration (EIA) Annual Convention was that natural gas has a strong future, but industry leaders need to do a better job in apprising the public and legislators of its positives in order to utilize the large supply build up.
The frac spreads of the first week of January 2008 compared to the first week of January 2009 show such a severe drop in margins that it is hard to believe that margins as late as mid-summer were above the January 2008 levels.
While some midstream industry observers were caught by surprise by the natural gas price depression over the past six months, some in the midstream industry have said that the decreased prices aren’t as much of a surprise as were the previous few years’ high prices.
The 88th Annual Gas Processors Association (GPA) Convention will take place next week at the San Antonio Rivercenter Hotel and present a mixture of ideas and presentations for the various segments of the midstream industry that makes the annual GPA convention such a unique event in the industry.
We’ve been reporting the last few weeks in GPR that the Haynesville Shale continues to have stout production activity due to the strength of its economics. Another shale that continues to produce, albeit quieter and at a slower pace, is the Marcellus.
Development of natural gas shale plays has resulted in an unprecedented boom in gas production in the U.S., but state agencies and residents where these shales are located are beginning to question the safety of the new techniques used to produce the shales.
Chairman of the U.S. House Agricultural Committee Collin Peterson (D- Minn.) will soon attempt to push legislation through the committee that would give the U.S. Commodity Futures Trading Commission greater oversight in reviewing and monitoring over-the-counter markets.
NGL prices steadily climbed throughout the first half of the year with prices peaking at record levels at Mont Belvieu and Conway in the second or third week of July before the global economic crisis caused a massive collapse in pricing in the second half of the year that saw prices drop to four- and five-year lows.
President-elect Barack Obama nominated Sen. Ken Salazar (D-Colo.) as Secretary of the Interior at a press conference that indicated the Obama administration would seek to clean up and possibly alter some of the drilling and leasing policies of the Bush administration.
In an effort to create greater price transparency, the Federal Energy Regulatory Commission (FERC) issued a final rule requiring interstate, as well as major non-interstate, natural gas pipelines to post information detailing supply and demand fundamentals in their markets.
Weaker natural gas prices have caused Chevron to slow down development of its holdings in the Piceance Basin. While development of the Colorado holdings will continue, the company will stick with the two rigs currently operating in the play rather than the previously planned six.
Crosstex Energy LP became the latest midstream player to sell off assets in an effort to improve liquidity in the midst of the global financial crisis. The company sold its 12.4% interest in the Seminole gas processing plant in Gaines County, Texas to Hess Corp. for $85 million.
Most midstream players are evaluating ways they can maximize profits, in the midst of the current economic crisis, and manage losses associated with Hurricanes Ike and Gustav either through the sale of assets or reduced spending.
Chesapeake Energy made a big push last week to reassure investors who have pushed the company’s stock down in the past few months by naming Mike Stice as senior vice president of natural gas projects and COO.
Enterprise Products Partners and its Duncan Energy Partners affiliate have pulled out of the Pathfinder pipeline project in the Rockies as a result of the credit crunch that has increased the cost of capital.
Chesapeake Energy’s stock value has lost 70% in the past three months, which is more a sign of an overall U.S. economic crisis than of the company’s value. Chesapeake is a top leaseholder in some of the most important natural gas plays in North America, including the Barnett, Haynesville, Fayetteville and Marcellus shales.
After much worrying, Hurricane Gustav’s impact on the energy industry looks to have been minimal with an early estimate from EQECAT Inc., which develops extreme-risk modeling software, stating that 5% of natural gas production for the next year will be shut-in.
The Woodford Shale in the Arkoma Basin has been the site of some interesting news in the past week. The biggest development was reported first in Industrial Information Resources, saying that Atlas Pipeline was planning a $150 million gas processing plant in Bennington, Okla.
Natural gas has found itself being discussed more and more in Washington. Last week, the House Select Committee on Energy Independence and Global Warming heard testimony on utilizing natural gas in more industries.
Liquefied natural gas (LNG) has been touted as the next big market in the U.S. for years, yet its import levels aren’t rising. In fact, they’re dropping. In 2007, the U.S. received 770.8 billion cubic feet of LNG.
Alaska Gov. Sarah Palin has lifted the curtain on a public-private joint venture with Enstar National Gas Co. to build an in-state gas pipeline that she says could be online in five years at a cost of about $3 billion.
For the first time, GPR has ranked the top processors in the U.S. (see table below). Many of the largest natural gas processors are likely to be included in next week’s rankings of the top NGL producers.
The Independence Hub being brought back online by Enterprise Products Partners this week is good news for storage facilities, which have been feeling the strain of reduced injection rates this season following a colder winter and decreased imports from Canada.
Representatives from China’s state-owned oil company Sinopec hosted a delegation of Alaskan representatives earlier this month in hopes of reaching an agreement to secure natural gas from the state’s North Slope region.
San Diego, Calif. -- Shell unveiled at the National Petrochemical & Refiners Association annual meeting here in March what it calls “Milos” technology for boosting the yield of diesel-destined light-cycle oil (LCO) or propylene from the fluid catalytic cracking (FCC) unit.
EnCana announced plans to reorganize by splitting the company into two primary divisions. One division, currently called GasCo, will focus on natural gas resources plays in North America. This division includes nearly all of the company’s NGL production. The other division, which has the working name of IntegratedOilCo (IOCo), will concentrate on the company’s established natural gas and oil production assets. Additionally, IOCo will focus on the company’s Canadian oil sands and refinery assets.
U.S. sanctions against Iran have continued to curtail investment in gas and oil projects in Iran from U.S. companies and corporations with U.S. interests. This week it appears that major LNG producers are pulling out or backing away from projects in the country, which the U.S. labels a supporter of international terrorism.
ConocoPhillips CEO Jim Mulva said he was hopeful of adding ExxonMobil to the Denali pipeline that ConocoPhillips and BP are developing in the North Slope of Alaska (see GPR 4/16/08). The statement came during ConocoPhillips’ conference call announcing its Q1 2008 results.
Citing a changing market, the Federal Energy Regulatory Commission (FERC) voted to include master limited partnerships (MLPs) into the proxy group to determine the return on equity (ROE) under the discounted cash flow (DCF) model.
Eagle Rock Energy Partners LP entered the Permian Basin by acquiring Stanolind Oil and Gas Corp. for $79 million in cash. Stanolind’s holdings are comprised of a 47% interest in gas producing proved reserves in the region. The remaining 53% interest is comprised of oil producing properties.
The recent credit crunch isn’t normally seen as an advantage in the midstream sector, but twice in the early months of 2008 Kayne Anderson has backed this notion of value in the market’s current conditions.
This year’s Gas Processors Association (GPA) Convention saw United Gas Derivatives Company (UGDC) of Egypt win the GPA’s award for safe international operations for a company with more than 500,000 workhours.
Some 39 U.S. states have signed some type of emissions reductions accord, said Mark Menezes of Hunton & Williams at the Gas Processors Association (GPA) Annual Convention’s Environmental Issues Roundtable: Climate Change – Issues & Industry Initiatives meeting.
The theme of this year’s GPA convention was change.
“The politicians may think that they invented change,” said GPA president Gene Thomas,” but our industry-wide gas processing growth, the aging of the workers, and other challenges means we must change.”
The former Alberta Energy and Utilities Board (EUB) began the oral portion of its NGL inquiry into NGL extraction issues on pipeline transmission systems and facilities regulated by the province of Alberta.
ONEOK Partners LP was forced to stop construction on a 16-mile section of its Overland Pass NGL pipeline by order of the Wyoming Bureau of Land Management (BLM) in order to protect wildlife in the area. The 16-mile section is part of a federal big game migration area.
The 2007 energy bill passed (HR 6) by Congress included one section that relates to the natural gas market. The Advanced Geothermal Energy Research and Development Act of 2007 authorizes $95 million annually for a five-year period from 2008 to 2012 to encourage the commercial use and development of geothermal energy.
Enterprise Products Partners is in the process of adding a fourth propylene splitter at Mont Belvieu which will increase propylene/propane fractionation capacity by about 1 billion pounds per year to a total of approximately 6 billion pounds per year.
The Commodity Futures Trading Commission (CFTC) received unanimous reauthorization approval from the Senate and the House Committee on Agriculture. CFTC reauthorization still requires full House approval.
Kayne Anderson Energy Funds announced its investment in the newly created Crestwood Midstream Partners LLC, a private company designed to pursue the acquisition and development of North American midstream assets. Crestwood has total equity commitments of $150 million.
With its right of way agreements in the region about to expire, Enterprise Products Partners formed a joint venture with the Jicarilla Apache Nation to own and operate natural gas gathering assets located on and near Jicarilla reservation lands in New Mexico. The land, part of 6,000 miles of natural gas pipelines Enterprise owns in New Mexico and Colorado, was previously fully owned by Enterprise.
Gateway Energy says expansion of the natural gas treatment plant at the Madisonville Project located in East Texas is completed. The additional facilities are designed to be capable of treating 50 million cfd, which combined with the capacity of the current in-service treating facilities will represent a total designed treating capacity of 68 million cfd.
Energy Transfer Partners came out vigorously defending itself Tuesday in its long awaited response to FERC’s Show Cause Order of July 26, which alleged that ETP manipulated natural gas prices at the Houston Ship Channel in the wake of Hurricanes Katrina and Rita.
A protest against rate increases on the Mid-America Pipeline (MAPL) by the National Propane Gas Association (NPGA) and five propane shippers finally makes it to trial before the Federal Energy Regulatory Commission beginning Tuesday.
BreitBurn Energy Partners made a major acquisition last week with its agreement to purchase all of Quicksilver Resources Inc.’s properties in Michigan, Indiana and Kentucky for $750 million in cash and $704.5 million in stock for a total package of $1.45 billion. The transaction is expected to close Nov. 1.
Jim Hunt has clear goals to grow Regency Energy Partners into a major midstream energy company and with the financial backing of GE Energy Financial Services (GEEFS) he is confident the goals will be achieved.
The names Hanover Compressor Co. and Universal Compression Holdings are now in the history books with the formation last week of Exterran Holdings, a “merger of equals” between the two largest independent compression companies. The new company has equity capitalization of approximately $3.8 billion.
(Publisher’s note: GPR Editor John Hart is on vacation. We thought this would be a good time to catch up on the proposed treatment of carried interest discussed in Congress.)
Are changes in the treatment of carried interest going to adversely affect midstream energy companies?
Increased use of biofuels and petroleum products from natural gas liquids could result in an oversupply situation in 2010, reducing gasoline prices and affecting refinery utilization, Scotland-based consulting firm Wood Mackenzie believes.
Michael Creel will become president and CEO of Enterprise Products Partners while Dr. Ralph Cunningham will take over as president and CEO of Enterprise GP Holdings. The management change takes effect Aug. 1.
Joseph Kelliher awaits approval of the U.S. Senate for another term as chairman of the Federal Energy Regulatory Commission. In May, the Senate Energy and Natural Resources Committee approved his re-nomination, sending it to the full Senate for final approval.
Spectra Energy Partners (SEP) welcomed the favorable reaction to its initial public offering last week with the more than 30% gain seen in the first day of trading seen as a strong endorsement of the midstream sector’s newest MLP .
FERC Chairman Joseph Kelliher says Commission policy should fully encourage the use of the MLP structure in the energy industries that they regulate, as long as the MLP structure is allowed by tax law.
The Gas Processors Association has issued new Fractionation Grade Product Specifications (GPA 2107-07) and is currently conducting balloting among GPA board members who must approve the changes. Ballots are due back to GPA by June 26.
First quarter net income for Hiland Partners fell 39%, to $3.6 million, from $2.2 million last year due mainly to lower realized natural gas and NGL sales prices and additional depreciation expense and interest expense incurred as a result of the acquisition of the Kinta Area gathering assets effective last May 1 and offset by increased sales volumes from the Kinta Area acquisition and the Bakken and Eagle Chief gathering systems.
Enterprise GP Holdings, which owns the general partner of Enterprise Products Partners, has purchased 17.6% or 39 million common units of Energy Transfer Equity and approximately 62.5 million common units of Energy Transfer Partners.
Over the past four months seven new MLPs hit the market with the investor community for the most part eager to snap them up. This strong interest is prompting other companies to put some of their assets into an MLP.
By 2030, the lion’s share of new natural gas requirements in Asia, the U.S. and Canada will be met by LNG while in Europe the need will be met mostly by new pipeline supplies, principally from Russia, allow LNG will play an important role as well.
The 86th annual Gas Processors Association Convention gets underway Sunday at the Marriott Rivercenter in San Antonio with 1,420 attendees from 20 plus countries and 475 companies on hand. The theme for this year’s convention is “Challenges in a Volatile Environment.”
State and regulatory support plus streamlined financing and construction approaches are a must for long-term supplies of LNG to come into the United States in a reliable way, says Spectra Energy’s Martha Wyrsch.
CERA Week, one of the energy industry’s most important conferences, ended last week after more than 2,000 attendees from 44 countries and 151 U.S. cities gathered at the Westin Galleria in Houston. Of all the discussion and the endless words spoken one message permeated: the vital need for energy security.
The natural gas midstream sector earns low customer satisfaction marks when compared with certain other segments of the oil and gas industry, EnergyPoint Research’s latest Customer Satisfaction Survey shows.
Spectra Energy remains on target to deploy more than $3 billion in capital expenditures over the next three years which will meet EBIDTA growth targets of 7% to 9% and earnings per share growth of 5% to 7% for the period.
NGL prices and fractionation spreads broke records in 2006, hitting a crescendo in July on the heels of $78.00 crude prices. In July, the NGL barrel at Mont averaged $48.34 and the barrel at Conway averaged $47.84.