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  • Alberta to cap oil sands emissions, phase out coal [View news story]

    So true, coal is the only true reliable base load supply. Natgas pipelines can be interrupted. When I drive by coal fired plants and see the piles of coal ready to burn, it seems very unlikely they would ever be interrupted by unplanned events.

    I read you description and saw you are type 1 diabetic, my son was diagnosed at age 13 (now 18). The University of Missouri breakthrough (link below) using stem cells to regenerate the blood vessels of the pancreas, reportedly enables the pancreas to start producing insulin again. Combined with a drug called Ig-GAD2 seems allow the pancreas to function normally, thereby potentially eliminating insulin injections. Hopefully, this leads to a cure.

    My brother-in-law's son is type 1 as well (now in his 40's) and told his father that the condition likely help drive him to success in his career (an aeronautical engineer) since it made him more focused and disciplined.

    I hope my son sees the cure someday, but admire the strength, success and determination those managing the condition exhibit. I believe battles like yours and my nephews helped and helps my son realize the disease won't dictate his life. I plan on showing him your bio when he comes home for Thanksgiving break from university.

    God bless you and Happy Thanksgiving.
    Nov 23, 2015. 10:23 AM | 7 Likes Like |Link to Comment
  • Peabody Energy to sell New Mexico, Colorado assets for $358M [View news story]
    Bowie Resources LLC

    Then go to "global customers" and click on Galena Asset Management under management and partners and Trafigura.

    Looks like Swiss money, this deal is solid and closing, no worries.
    Nov 23, 2015. 09:26 AM | 1 Like Like |Link to Comment
  • Alberta to cap oil sands emissions, phase out coal [View news story]
    From the press release:

    Electricity and renewables
    •Alberta will phase out all pollution created by burning coal and transition to more renewable energy and natural gas generation by 2030.
    •Three principles will shape the coal phase-out: maintaining reliability; providing reasonable stability in prices to consumers and business; and, ensuring that capital is not unnecessarily stranded.
    •Two-thirds of coal-generated electricity will be replaced by renewables – primarily wind power – while natural gas generation will continue to provide firm base load reliability.
    •Renewable energy sources will comprise up to 30 per cent of Alberta’s electricity production by 2030.

    "providing reasonable stability in prices to consumers and business; ensuring that capital is not unnecessarily stranded" Wow that sounds expensive to rate payers and who defines "unnecessarily stranded". Sounds like one term for Notley.
    Nov 23, 2015. 08:54 AM | 3 Likes Like |Link to Comment
  • Peabody Energy to sell New Mexico, Colorado assets for $358M [View news story]

    Clueless may be a bit harsh, since most analysts are intelligent and provide decent analysis on financials.

    I recall before I retired (was a position trader at a major investment bank) we had one analyst who we nicknamed "wrong way", nearly every time he put a sell on one stock (I was the trader for it) we would buy it that day (from clients) and then sell the next day at a profit. It worked the other way as well, when he said buy, we would short it and cover the next day at a profit. It got to the point that trading accounts (hedge fund clients) we told about it would put the trade on as well (they loved it).

    Of course he eventually had the stock removed from his coverage list and he ultimately departed the firm. This also was before research was required to show graphs depicting buy/sell ratings changes in relation to the stock price. It is much harder now for analysts to keep horrendously bad track records going before they are removed from covering names that they can't seem to get right.
    Nov 21, 2015. 02:36 PM | 1 Like Like |Link to Comment
  • Peabody Energy to sell New Mexico, Colorado assets for $358M [View news story]
    Agreed, and likely closer to $5 per ton when calculating the interest payments saved by retiring debt early. I wonder if they had any Letters of Credit as collateral for the $300 million in self bonding that will now be free to add to the firepower for debt buybacks or at least offset the cash collateral they said will be needed this quarter for Australia bonding requirements.

    Also, nice call by UBS this week in going to sell on BTU. It never ceases to amaze me how clueless some analysts are on stock entry and exit points. Factor in tax loss selling that likely has been going on as well (it is that time of year), meaning a lot of sellers in BTU for tax reasons are now probably done or will pull back and watch. A price back into the low $20s (or higher) Monday seems probable and if the news flow continues positive, let the real squeeze begin.
    Nov 20, 2015. 10:58 PM | 12 Likes Like |Link to Comment
  • Peabody Energy's Restructuring Plan Could Be Announced After VEBA Issue Is Resolved [View article]

    The green movement is a joke, unfortunately as you state with the skinny one as POTUS they are able to exert disproportionate power via administrative courts of law. They sue over perceived injustices to their furry friends, changing atmosphere (blaming mankind even though they are part of it) and polluted water (ask the EPA politburo about that one) while all the time demanding payments in the name of nature conservation. It used to be a cottage industry that has grown like a malignant tumor under this idiot we have as POTUS. The Corleone family would recognize the method and be envious of their political connections.

    As one member of this syndicate states above about England closing a coal plant, see the link below to see what they substituted the generation with, as the old Guinness commercial used to say, Brilliant! In essence, they complied with all renewable energy laws and succeeded in creating a dirtier biomass plant that now operates.

    Also, with Germany's plan to close their nuclear industry after Japan's Tsunami (a rash decision if here ever was one) the country has increased the burning of coal (link below), despite the heavy subsidies they throw at renewable energy. The country is actually building new coal capacity, so disregard the wacko green enviros who live in an alternate universe with POTUS.
    Nov 19, 2015. 07:40 PM | 4 Likes Like |Link to Comment
  • Peabody Energy agrees with NY AG to greater disclosure of financial risks [View news story]
    Two year investigation that makes Peabody admit their crystal ball on the future demand of their product may not adequately capture the destructive nature of a misguided regulatory policy based on questionable science? Wow, what a waste of time, New York actually wastes resources paying for this garbage? No wonder businesses and people leave that state.
    Nov 9, 2015. 11:19 AM | 5 Likes Like |Link to Comment
  • Peabody Energy: The Bears Can't Have It Both Ways [View article]

    Yes natgas is a byproduct of oil drilling and will always be sold if the infrastructure is there to capture and transport it, rather then flare/burn it off.

    However, many shale fields are natgas rich and not oil rich. The Marcellus field is an example (link below). Capping wells/production in these fields to limit supply makes sense until prices rise with increasing demand. The oil/gas majors can do this if they control these fields, currently they do not.

    Natgas is not in backwardation and is in contango (second link) and has been for as long as I can remember. I am a retired position trader from a major investment bank, didn't trade actual natgas commodity (traded European oils/industrials for eight years as well as U.S. small/midcap energy materials for a couple of years), but followed the oil and gas commodity movements daily and produced reports on the weekly EIA oil and natgas storage reports for sales force and clients. Contango usually exists when there is ample supply, which certainly is the current environment.

    Finally, as you likely know, there is still much debate on the depletion rates from shale wells (both oil and gas) with many believing that these wells deplete faster then conventional wells. Fact or fiction (time will tell), one certainty is that shale fields require more wells to be drilled, at additional expense.
    Nov 5, 2015. 08:08 PM | 2 Likes Like |Link to Comment
  • NYT: Exxon climate statements under NY AG scrutiny [View news story]
    I guess Schneiderman will be running for governor of N.Y. Also, it sounds like Peabody (aka Delta) has been on double secret probation! I believe that is Schneiderman in the video below.
    Nov 5, 2015. 04:02 PM | 12 Likes Like |Link to Comment
  • Peabody Energy: The Bears Can't Have It Both Ways [View article]
    I believe many shale oil and gas producers had to start drilling or lose their lease on acreage drilling rights. As, the author points out the major midstream players are highly levered, but they will be able to roll over their debts and they certainly will cut cap-ex and expansion plans well before refinancing is needed.

    However, many small and midsized players will not be able to roll over their debts and their production will be sold to larger players at discounted prices and shut-in until prices improve markedly. The fact the oil/gas majors have announced massive cap-ex reductions (over $200 billion) means they will acquire most of the distressed assets, which replaces the lost production increases that would have come from their new cap-ex on development. It is so important to remember in the oil and gas business you are running frantically just to stay in place due to depletion.

    Natural gas is nicknamed the "widow maker", it will live up to the name again at some point and when the price moves higher, coal will once again be the stable low cost alternative for utilities that haven't completely deserted coal. As the EIA has repeatedly forecasted, coal will remain in the energy mix for the next few decades (or longer).

    Finally, if the eventual price rise in natgas large enough and sustained over time, we may even see new cleaner operating coal plants built, providing we get a change next November in our government that wipes away the current EPA absurdity and ridiculous executive orders issued by the current anti-American business administration that resides in D.C.

    To Courage and Conviction, your work on Peabody is excellent and I am long Peabody equity, it is due to your work that I have added a position in the bonds as well and believe they have many options to survive, but as you have stated many times they need to take action sooner rather then later or their options will dwindle as they wait for the much needed rebound in price and tonnage.
    Nov 5, 2015. 03:24 PM | 3 Likes Like |Link to Comment
  • Peabody Energy: Indiana, Let It Go [View article]
    Biological, excellent post, so true about our current sorry excuse for government and their outrageous quest to destroy the coal industry. A very old and good friend of mine knows people who bought and sold coal mines and he has told me that these investors have never, in their lifetimes, seen a U.S. government so hostile to an industry.

    I too was way to early in this investment in BTU and it has cost me more then a few multiples of what C&C lists above, but I will hold as you say until the elephant enters the room and will wait until the 800 pound gorilla known as the hostile current administration leaves the room.
    Oct 30, 2015. 11:17 AM | 3 Likes Like |Link to Comment
  • Peabody Energy: Time To Play Hedge Fund Whack-A-Mole [View article]
    C&C, your reply from above is so spot on (below).

    Right now, it's 2009 for BTU. Too bad Buffet's Berkshire Hathaway Energy is trumpeting their climate change pledge as many companies pay lip service to our current government. What Peabody could really use is an investment (or loan/sale on unencumbered assets) from Buffet as BofA and Wells obtained from the "Oracle of Omaha" of a billion or two to start market purchases of their debt. Structured like the BofA preferred with warrants, would be a homerun for him, but unfortunately unlikely to happen.

    "Author’s reply » Fliper - you are exactly right. The market pushed BofA and WFC there in 2009. JPM was way too strong and Jamie Dimon is the best banking CEO in the world.

    If they can push BofA and WFC then they can push Peabody. Time to announce my convertible deal. it is sink or swim time."
    Oct 29, 2015. 11:57 AM | Likes Like |Link to Comment
  • MLPs struggle as reality check slaps old narrative of hedge against price swings [View news story]

    so true, ETF liquidations earlier this week were indiscriminate. All quality large cap MLPs (MMP, SEP, EPD, ETP to name a few) are held in ETFs. An ETF gets an order to liquidate (especially physical delivery) they sell seemingly regardless of price (algorithm/program) with only real objective of completing the sale of basket of MLPs.

    Since Tuesday's lows, EPD +25%, MMP +19%, ETP +15% and SEP +8%. KMI, although no longer an MLP, stills trades with sector was +14%. The fact that the larger the market cap, the more volatile the move, indicates to me ETF liquidations, since the larger cap MLPs, which hold larger weightings within the sector ETFs, were sold more heavily and provided the bulk of the funds liquidated.

    The subsequent rallies in these names seems to continue today, which likely indicates the end of the month, and more importantly end of the quarter sell program in MLPs is over.
    Oct 2, 2015. 02:17 PM | 3 Likes Like |Link to Comment
  • No long-term future in tar sands, Alberta's premier says [View news story]
    "Alberta premier Notley says she sees no long-term future in fossil fuels" technically, correct since all fossil fuels are eventually depleted without new sources being brought online. Most energy companies now are cutting cap-ex which guarantees supply reductions and ultimately higher prices since demand is relatively inelastic for fossil fuels no matter what the lunatic left dreams and hopes for. Maybe the voters of Alberta should try a recall on the election of Nutley, sorry Notley.
    Sep 30, 2015. 04:41 PM | 4 Likes Like |Link to Comment
  • Environmentalists challenge major U.S. mines owned by CLD, ACI, BTU [View news story]

    so true, four more years of the skinny one's reign of terror on the U.S. would definitely regress the country further toward their goal of having bicycles and horses as prime modes of transportation.

    On a more serious note, a repeal of all the ridiculous regulation and executive orders by the next president of Skinny's agenda will begin the process of recovery for the country both domestically and internationally. This country can survive bad presidents, but eight years of incompetent, or more likely an anti-American agenda, has left it's mark and will be felt for some time to come.
    Sep 19, 2015. 10:28 AM | 5 Likes Like |Link to Comment