Tue, Nov. 24, 12:49 PM
- Canadian oil producers may say they are on board with Alberta’s new climate change policy goals, but the requirement that companies reduce their methane emissions by 45% will add costs "in the tens or hundreds of millions of dollars over the next five years," the Canadian Association of Petroleum Producers says.
- Alberta’s oil and gas sector produced 30.4 megatons of methane emissions in 2013, accounting for 70% of the province’s overall methane emissions.
- National Bank Financial analyst Kyle Preston calls Alberta’s climate change policy “fair and accommodating” for oil and gas companies, and says newer energy projects such as Canadian Natural Resources' (NYSE:CNQ) Horizon oil sands project and MEG Energy’s (OTCPK:MEGEF) Christina Lake facility emit less greenhouse gas than older facilities, which will be hit harder by the new policies.
- Other related tickers: TRP, ENB, IMO, XOM, RDS.A, RDS.B, OTCQX:COSWF, OTCPK:HUSKF, CVE
Mon, Nov. 23, 8:19 AM
- Alberta's government announces plans to cap oil sands emissions for producers, phase out coal power plants and implement a carbon tax in an effort to curb pollution.
- The provincial government in impose a limit of 100 megatons/year of carbon emissions, above current annual emissions of ~70 megatons, phase out coal power plants by 2030, and set a carbon price of C$20/metric ton (US$15) by 2017 which rises to C$30 in 2018.
- The Canadian Association of Petroleum Producers supports the initiative, saying it could help improve Alberta’s image in markets to which oil sands producers hope to expand access.
- "This will create a wealth of opportunities and jobs for generations to come. We in Alberta want to take a leadership role on climate," says Suncor (NYSE:SU) CEO Steve Williams.
- Coal producers criticized the new policy, however, saying it will raise electricity costs in Alberta and cost Canadian jobs.
- Other relevant tickers: TRP, ENB, IMO, XOM, RDS.A, RDS.B, OTCQX:COSWF, OTCPK:HUSKF, CVE, CNQ
Thu, Nov. 12, 7:11 PM
- Hard-hit Canadian energy producers, coming off a bleak Q3 earnings season, are signaling they will cut capital spending for a second straight year in 2016, Reuters reports.
- The seven biggest Canadian producers cut 2015 capital spending by 39%, or a combined C$12B, from last year, and Eric Nuttall, portfolio manager at Sprott Asset Management, expects another 10%-20% reduction for 2016.
- Of the seven, so far only Cenovus Energy (NYSE:CVE) and Canadian Natural Resources (NYSE:CNQ) have outlined 2016 budgets; CVE estimates 2016 capex of C$1.5B-C$2B vs. C$1.8B-$1.9B in 2015, and CNQ expects to spend C$4.5B-C$5B next year from C$5.44B in 2015.
- Encana (NYSE:ECA) today bucked the trend a bit by speeding up investment in the U.S. Permian Basin this year but is using capital originally earmarked for 2016; the company suggested in its earnings conference call that 2016 spending will be carefully controlled.
- Also: SU, TRP, ENB, IMO, OTCPK:HUSKF
Wed, Nov. 11, 1:10 PM
- Canadian Natural Resources' (CNQ -2.4%) sale of most of its royalty lands to PrairieSky (OTC:PREKF) is a strategic departure for the company but attractive given current market conditions, solidifying its balance sheet and allowing it to keep some asset upside, says RBC Capital's Greg Hardy.
- TD Securities analyst Menno Hulshof agrees that CNQ executed the deal at attractive metrics, but seems uncertain about CNQ's plan to return to investors at least 47% of the PrairieSky shares it receives in the deal, perhaps as a one-time special dividend.
- "We suspect some would have preferred an all-cash transaction whereby all proceeds could have been earmarked for debt reduction" rather than just the remaining 53% of the PrairieSky position, Hulshof says.
Mon, Nov. 9, 7:38 AM
- Canadian Natural Resources (NYSE:CNQ) +2.7% premarket after agreeing to sell a part of its royalty assets to PrairieSky Royalty (OTC:PREKF) in a cash and stock deal worth ~C$1.8B ($1.4B).
- CNQ says PrairieSky will pay C$680M in cash and ~44.4M in stock valued at C$25.20/share.
- PrairieSky is acquiring assets representing ~6,700 boe/day, or 81% of CNQ’s royalty volumes; the assets comprise ~5.4M acres of royalty lands throughout western Canada.
Thu, Nov. 5, 8:45 AM
- Canadian Natural Resources (NYSE:CNQ) +0.4% premarket after reporting a surprise Q3 profit and better than expected revenues, and again cutting its capital spending budget.
- CNQ, which already had cut its capex program four times, says it now targets full-year 2015 spending of C$5.44B ($4.13B), down from its most recent projection of C$5.5B, and says spending will fall further in 2016 to C$4.5B-C$5B.
- CNQ says it is targeting 2016 production of 840K-850K boe/day; says Q3 production averaged ~848K boe/day, up from 797K boe/day in the year-earlier quarter.
- Says Q3 cash flow fell 37% to C$1.53B.
Thu, Nov. 5, 5:42 AM
Thu, Nov. 5, 5:40 AM
Wed, Nov. 4, 5:30 PM
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Fri, Oct. 30, 4:22 PM
- Reuters reports Canadian Natural (NYSE:CNQ) is exploring options for its royalty assets, and has held talks with the Canada Pension Plan Investment Board, the Ontario Teachers' Pension Plan, and PrairieSky Royalty.
- Cenovous Energy struck a C$3.3B deal to unload its royalty lands to Ontario Teachers' earlier this year. Meanwhile, Bloomberg reported last month ConocoPhillips was near a ~$1B deal to sell Western Canadian assets to Canadian Natural and other buyers. Canadian had $16B in debt at the end of June.
Tue, Oct. 27, 7:37 PM
- Energy-dependent Alberta today unveiled its 2015 budget, the first under the new NDP government, projecting a record deficit on falling revenue linked to the sharp slump in crude oil prices.
- It's a spend and borrow budget that will see the province borrowing for operating for the first time in two decades, promising to spend an additional C$4.5B above previous commitments over the next five years for infrastructure such as new transportation projects and hospitals.
- As for the oil sector, which is pleading for a three-year lag before royalties are changed, Finance Minister Ceci indicated no letup from the NDP's promise of royalty increases and tougher climate change regulations once reviews now underway are completed over the next few months.
- Relevant tickers: SU, ENB, TRP, KMI, IMO, CVE, CNQ, OTCPK:HUSKF, OTCQX:COSWF.
Wed, Oct. 21, 12:58 PM
- Canadian Natural Resources (CNQ -2.4%) is Barclays' top E&P pick in an otherwise dismal sector, as analyst Thomas Driscoll notes that E&P firms likely slowed their completion activity due to low oil prices in Q3 while Q4 volumes may be at risk.
- But Driscoll calls Overweight-rated CNQ his "most fundamentally undervalued" name, and says the company is transitioning to a "long-lived, low-maintenance and low-decline" production profile which is not reflected in the "annuity-like character of its asset base."
- The firm also has Overweight ratings on EOG Resources (EOG -0.6%), Noble Energy (NBL -0.5%) and Southwestern Energy (SWN -4.4%).
Tue, Oct. 20, 2:30 PM
- Canada's oil patch may have lost a major energy opportunity with the defeat of the Conservative government, but Canadian energy stocks are mostly higher despite the surprise mandate won by Justin Trudeau's Liberals that promises less favorable energy policies and increased environmental stewardship.
- The Liberal majority at least removes the uncertainty of a widely speculated minority government and gives the changing industry political stability in Ottawa, the president of the Canadian Association of Petroleum Producers says.
- Energy proponents in Alberta may be relieved that last May’s provincial NDP victory did not translate into a federal win by Tom Mulcair’s NDP, which would have brought far tougher anti-oil policies that the winning Liberals.
- Trudeau is opposed to Enbridge's (ENB +1.1%) Northern Gateway pipeline, but has expressed qualified support for TransCanada's (TRP +1.4%)Keystone XL and Energy East and Kinder Morgan’s (KMI +0.5%) TransMountain projects, though he would also bring in tougher environmental review processes and a national plan to tackle greenhouse gases.
- Some say an Obama administration veto for Keystone XL would make the job easier for the new Prime Minister in an effort to reset a relationship with the U.S. he says was damaged by the outgoing Stephen Harper.
- Also: SU +1.3%, IMO +1.1%, CVE +1.1%, CNQ +3%, OTCPK:HUSKF +0.6%, CNI +1.9%, CP +3.8%.
- Earlier: Canadian energy stocks to turn red if Harper fails to win upcoming election (Oct. 14)
Tue, Oct. 6, 12:44 PM
- Chevron (CVX +2.7%) could enjoy "a step forward" in its Q3 results vs. other oil majors such as Exxon Mobil (XOM +1.4%), ConocoPhillips (COP +2.9%) and Canadian Natural Resources (CNQ +4%) that are likely to muddle through another tough quarter for earnings, free cash flow and leverage creep, J.P. Morgan's Phil Gresh writes.
- The analyst sees an opportunity for CVX to take a step forward with rebuilding investor confidence around the long-term cost reduction and dividend coverage story, although the real uplift will have to come with an on-time Gorgon startup, which is still slated for Q1 2016; he rates the stock as Overweight.
- JPM has lowered its 2016-18 EPS estimates for natural gas prices in North America and Europe, which now show limited potential for recovery over the next few years and are considered most impactful for Neutral-rated XOM and CNQ and Underweight-rated COP.
Mon, Oct. 5, 5:49 PM
- Investors rushed back into Canadian oil companies today in hopes of picking up the next takeover target following news of Suncor's unsolicited $4.3B bid for Canadian Oil Sands.
- MEG Energy (OTCPK:MEGEF) jumped 22% on speculation it could be the next in line to be taken over, perhaps by Imperial Oil (NYSEMKT:IMO), which has been considered a possible suitor for Canadian Oil Sands.
- Penn West (NYSE:PWE) also surged 22% as investors "clearly are positioning themselves into the next potential target, and both of them [MEG and PWE] make some sense,” says TriVest's Martin Pelletier. "They both have stretched balance sheets, both have been beaten up in the market, and they are a heck of a lot cheaper than last year.”
- Other oil sands stocks also climbed following the Suncor offer: CVE +3.3%, OTCPK:ATHOF +14.5%, CNQ +8.8%.
Tue, Sep. 22, 3:38 PM
- ConocoPhillips (COP -0.1%) is near a deal to sell several western Canadian assets to various buyers including Canadian Natural Resources (CNQ -1.9%), Bloomberg reports.
- The group of assets could be valued at $1B or more, according to the report, and an agreement could be reached as soon as this week.
- Production from the properties, located in Alberta, British Columbia and Saskatchewan, is said to represent ~20% of COP’s Canadian volumes outside of oil sands.
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