Seeking Alpha
  • Today - Thursday, August 21, 2014

  • 7:19 PM
    • Amid the latest flareup of Middle East violence, one-time enemies Israel and Egypt are negotiating deals that may mean the sale of $60B in Israeli natural gas to liquefaction plants in Egypt.
    • Executives at Noble Energy (NYSE:NBL) and units of Israel’s Delek Group said this week they expect to finalize by year-end agreements to deliver as much as 6.2T cf of gas over 15 years from the Tamar and Leviathan offshore fields to LNG facilities in Egypt.
    • For Israel, the two fields have more than enough gas to supply it for decades, so it is seeking a way to export the excess, and shipping it to Egypt would be faster than building LNG plants; the Russia-Ukraine crisis has made energy security a top priority for Europe, which will be scrutinizing all potential energy sources.
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  • 6:20 PM
    • Baker Hughes (NYSE:BHI) is poised to win the biggest contract in Petrobras' (NYSE:PBR) $1.5B-$2B offshore drilling program, according to a Bloomberg report.
    • BHI is said to have placed the lowest-cost bid for a contract representing half the drilling work being offered by the Brazilian company over the next four years, charging less per well compared with other drilling packages that have smaller volumes of work.
    • Schlumberger reportedly offered the cheapest bid for a second package representing 30% of offshore wells and Halliburton (NYSE:HAL) placed the lowest-cost offer for the remaining 20% of work.
    • Meanwhile, PBR has spudded the first appraisal well in the pre-salt Libra field, where production is scheduled to begin in 2017, plateauing at 1.3M bbl/day in 2030.
    | 1 Comment
  • 3:53 PM
    • Jim Cramer offers a shout-out for DistributionNOW (DNOW +1.6%), the distribution business that recently was spun out from National Oilwell Varco, as a long-term gainer based on the amount of money set to be spent on oil pipelines.
    • Cramer notes that Rich Kinder believes $800B will be spent on new pipeline, and DNOW CEO Robert Workman confirmed the outlook on CNBC's Mad Money.
    • Cramer sees DNOW as a one-stop shop for the industry's pipe, valve and flange needs, and notes that Warren Buffett has acquired a stake in the company.
    | 2 Comments
  • 3:29 PM
    • Mozambique will invest more than $30B to begin building capacity in its natural gas sector to produce 20M metric tons/year of liquefied natural gas, with the first exports due to start in 2018, according to the head of the national oil company.
    • The investments will be made to develop the northern ports of Pemba and Palma, where a giant logistics base and LNG production plants are planned that will use gas produced from offshore fields in the Rovuma Basin being developed by Anadarko Petroleum (NYSE:APC) and Eni (NYSE:E).
    • Commitments from APC and Eni already run into several billions of dollars, but the national oil company estimate is the first to put an overall price tag on the first phase of Mozambique's LNG ambitions.
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  • 2:56 PM
    • DuPont ([[DD] +0.4%) says it has filed a patent infringement lawsuit against SunEdison (SUNE -0.3%) and its NVT affiliate, alleging infringement of its patented tellurium paste technology.
    • DuPont says that by sourcing and using photovoltaic cells and solar modules containing Samsung SDI front-side metallization paste, SUNE is infringing on DD's patent.
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  • 2:29 PM
    • The latest fleet status reports from Diamond Offshore (DO -0.2%) and Hercules Offshore (HERO -3.8%), released after yesterday's close, appear to provide another sign that offshore drilling likely will get worse before it gets better.
    • Raymond James analysts explain that DO's negative fleet status included a lower than expected dayrate on the ultra-deepwater rig Ocean Monarch for one year at $425K, below the firm's estimated 2015 rate of ~$450K; a convertible option to alter the contract to an 18-month term also was below expectations.
    • HERO's August fleet status included a contract termination; Raymond James had expected choppiness in the coming months through hurricane season, but says the termination and increase in potential rigs available is cause for further caution.
    • Also: SDRL -0.7%, RIG -0.5%, ESV -0.2%, HP -1.3%, RDC -0.7%, ATW -1%.
    | 9 Comments
  • 1:58 PM
    • Cameco (CCJ -4.9%) slumps nearly 5% after Cowen analysts downgrade the stock to Market Perform from Outperform with a $20 price target, lowered from $25, as the firm anticipates an extended malaise in uranium pricing.
    • Cowen reassesses its uranium market outlook and expect that a meaningful recovery in pricing will not surface until 2017; despite strong long-term fundamentals, expectation for a recovery is more distant as a result of Japan's painfully slow restart process and ample global supply.
    | 4 Comments
  • 1:03 PM
    • Statoil (STO +0.4%) signs a five-year deal with Lithuanian gas supplier Litgas to deliver 540M cubic meters/year of liquefied natural gas from 2015, a move that could end Lithuania's dependence on Russian gas.
    • STO's first shipment of LNG is set to be delivered at the Klaipeda terminal in December, with a new floating terminal set to begin commercial operations by Jan. 1, 2015.
    • Lithuania is currently dependent on Gazprom (OTCPK:OGZPY) for 100% of its gas, and the country has been paying 15% higher than the European average gas price.
    | 1 Comment
  • 12:36 PM
    • Rosetta Resources (ROSE +0.6%) is benefiting slightly from an upgrade from KLR Group, which raises its rating to Accumulate from Hold and announces a $59 price target after shares have sold off ~7% since Aug. 11.
    • ROSE has significant upside potential in the Eagle Ford and Delaware Basin sites, the firm says, seeing the two locations driving 30% growth in 2015.
    • An Upper Eagle Ford pilot test has been successful, exhibiting similar performance as Lower Eagle Ford, according to KLR; in the Delaware Basin, only 4-5 rigs are currently in place while ROSE plans to add 20 more in 2014.
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  • 12:03 PM
    • Whitecap Resources (OTC:SPGYF +6.9%) agrees to acquire a controlling stake in a Niska light sweet oil pool in Alberta for ~C$267M, which it says will add 2,500 boe/day of production.
    • The purchase includes strategic facilities consisting of two oil batteries, water disposal infrastructure and pipelines which Whitecap says will be important for future low-cost production growth.
    • The company also plans to sell ~600 boe/day of non-core production for C$57M, and announces a 12% dividend hike to a monthly C$0.07/share.
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  • 11:35 AM
    • Plains All American Pipeline (PAA -0.5%) announces plans to construct a 440-mile pipeline from its Cushing, Okla., terminal to Valero's (VLO +0.2%) Memphis refinery, to provide capacity of up to 200K bbl/day of domestic sweet crude.
    • PAA expects total project investment of ~$900M and completion in late 2016.
    • PAA says the Diamond pipeline project is underpinned by a long-term shipping agreement with VLO and a related contract for storage and terminalling services at the Cushing terminal.
    • VLO holds an option until Jan. 2016 to become a partner in the pipeline and purchase a 50% interest.
    | 2 Comments
  • 11:07 AM
    • A planned $2B deal between Rosneft (OTC:RNFTF) and oil trader Vitol has been scrapped, FT reports, in the clearest sign yet that tougher western sanctions are hurting the Russian state oil group’s ambitions.
    • Vitol, the world’s largest independent oil trader, had been in talks to raise the money from international banks to make an advance payment to Rosneft in exchange for future oil supplies, but sources say the deal has been shelved in the wake of the latest round of sanctions.
    • Bankers and traders say the latest round of sanctions likely will discourage western banks from financing new such prepayment deals, even if existing deals are unaffected.
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  • 10:42 AM
    • Penn West Petroleum (PWE -0.6%) says holders of its unsecured notes have provided waivers that give it until at least Oct. 14 to fix defaults arising from the previously announced restatement of more than four years of financial results that revealed hundreds of millions in expenses had been classified incorrectly.
    • PWE previously received waivers from the defaults under its bank lending agreements; it announced last week it had access to up to $660M under the bank facility, of which $250M had been drawn.
    | 7 Comments
  • 10:30 AM
    | 2 Comments
  • 9:57 AM
    • Russia's Gazprom (OTCPK:OGZPY) says it has started seaborne shipments of oil to Europe from its Novoportovskoye field in the Arctic.
    • Gazprom says more than 80K metric tons of the new Novy Port oil classification, light and low-sulphur, was scheduled to be delivered from the field by two tankers during the 2014 ice-free season.
    • Meanwhile, Gazprom says Ukraine's outstanding debt for gas supplies stood at $5.3B as of Aug. 1 and calls on Ukraine's government to ensure that gas continues to transit without disruption to Europe.
    | 1 Comment
  • 8:38 AM
    • Eni (NYSE:E) says it has started production at the offshore Deka gas project in Egypt in a joint venture with BP, with the first of five development wells in operation producing 1.8M cubic meters/day of gas.
    • Deka's production is expected to reach its peak in Q1 of next year with a total gross gas rate of ~6.5M cubic meters/day.
    • Eni, the biggest foreign energy player in Egypt, produced ~228K boe/day last year.
    | 1 Comment
  • 8:19 AM
    • Even as chaos continues to engulf the country, Libya said yesterday that oil exports would resume shortly from the Es Sider terminal, the country's largest and capable of exporting 350K bbl/day of crude, after being shut for the past year.
    • Libya’s production is now well over 500K bbl/day, still below peaks reached under Gadhafi's rule but a significant addition to global oil supply.
    • Crude oil futures are falling in Europe on news of the increased Libyan supply as well as weak overnight data on Chinese manufacturing; October Brent crude on the ICE exchange fell $0.71 to $101.57.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, CRUD, USL, UWTI, DWTI, DNO, SZO, OLO, OLEM, TWTI
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  • 7:13 AM
    • Petrovietnam has entered talks with banks to secure financing for a seven-year loan of up to $1.8B for its bid to buy a stake in Murphy Oil's (NYSE:MUR) Malaysian oil and gas assets.
    • The $1.8B offer tops a $1.5B bid previously made by India's Oil & Natural Gas and Oil India. Mitsubishi (OTCPK:MSBHY) is also bidding on the assets.
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  • 4:55 AM
    • After a year-long blockade, Libya has restarted oil exports from its largest port, resolving some mistrust between rebel leaders and the government.
    • Despite the ongoing clashes and violence still raging in main cities, the OPEC member's oil production has risen in the past few weeks to around 560K barrels a day.
    • The new production is well above the 100K bpd seen earlier this year, but still short of the 1.4M bpd a year ago.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, CRUD, USL, UWTI, DWTI, DNO, SZO, OLO, OLEM, TWTI
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  • Wednesday, August 20, 2014

  • 6:21 PM
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