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MISO awards contract for 345-kV line; Total to buy 23% stake in Tellurian

Top News

MISO selects LS Power-led project in competition for 345-kV line

The Midcontinent Independent System Operator Inc. selected a partnership led by private developer LS Power Associates LP to build, own and operate the Duff-Coleman 345-kV line in southern Indiana and western Kentucky, the first transmission project selected through a competitive process in compliance with FERC Order 1000. MISO selected Republic Transmission LLC, a partnership between the LS Power Group unit and Hoosier Energy Rural Electric Cooperative Inc., out of 11 applicants, the grid operator said in a Dec. 20 press release.

Infusion from giant Total to help fledgling Tellurian secure 1st LNG project

The massive balance sheet of Total SA should help Tellurian Investments Inc. when it comes time to nail down financing for the proposed 26 million-tonne-per-annum Driftwood LNG liquefaction and export terminal, analysts said. Total and Tellurian said on Dec. 20 in a joint statement that Total will buy a 23% stake in Tellurian for $207 million in order to help secure U.S. natural gas supply and deliver LNG from the Driftwood LNG terminal proposed for Calcasieu Parish, La.

Trump's EPA pick offers past at odds with coal, but industry optimistic

The U.S. coal industry remains bullish about President-elect Donald Trump's selection of Oklahoma Attorney General Scott Pruitt to head the U.S. EPA despite previous comments that are at odds with the industry's view on its recent challenges. Pruitt was selected by Trump earlier this month, promising a staunch advocate against Obama administration regulations that are often cited as detrimental to the coal industry.


* The staff of the Kansas Corporation Commission has recommended that the proposed merger between Westar Energy Inc. and Great Plains Energy Inc. be rejected for not being in the public interest. However, certain analysts are still optimistic that the state commission will approve the proposed combination.

* TerraForm Global Inc. released its fourth-quarter 2015 financial results, which include adjusted EBITDA of $40 million, net loss of $254 million, and net revenue of $51 million. The yieldco, an affiliate of bankrupt renewable energy developer SunEdison Inc., also filed its first financial report in more than a year as part of its efforts to "regain regulatory compliance."

* U.S. Senate Minority Leader-elect Chuck Schumer announced the names of Democratic committee members for the 115th Congress, including lawmakers who will serve on that chamber's energy and environment committees. GOP staff have yet to release a full list of Republican committee members for the new Congress, which convenes Jan. 3, 2017.

* Colorado Springs Utilities denied that its Martin Drake coal-fired facility in El Paso County, Colo., violated federal standards for sulfur dioxide emissions, the Colorado Spring Gazette reported. The violations are reportedly included in a report by consultant AECOM Inc., which the utility does not plan to release until February 2017.

* Georgia regulators approved a cost recovery settlement for two delayed reactors at the Alvin W. Vogtle Nuclear Plant that deems "prudent" $3.3 billion of capital costs and that incentivizes Georgia Power Co. to finish construction by 2021, when eligibility for federal production tax credits will expire.

* Southern California Edison Co. is awarding the San Onofre Nuclear Generating Station decommissioning contract to a joint venture of AECOM and EnergySolutions. Major dismantlement work will only begin after state regulators complete their environmental review, which is not expected before 2018, according to a news release.

* NextEra Energy Resources LLC has commissioned the 200-MW Kingman and 208.3-MW Ninnescah wind farms in Kansas. The facilities are selling power to Westar Energy Inc. under long-term agreements. Westar expects to add 280 MW of wind power from the Western Plains project in early 2017, bringing its commitment to renewable energy to about 1,750 MW, according to a Westar release.

* Location matters for new energy projects, and now developers can determine the most competitive form of new electricity generation in each county in the U.S. thanks to a new online tool and interactive map from researchers at the University of Texas at Austin.

* NJR Clean Energy Ventures completed the 39.9-MW Ringer Hill wind farm in Somerset County, Pa. Iron Mountain Inc. will purchase 26.6 MW from the facility under a 15-year contract. NJR Clean Energy is a subsidiary of New Jersey Resources Corp.

Natural gas/midstream

* The Oklahoma Corporation Commission's Oil and Gas Conservation Division and the Oklahoma Geological Survey developed new well-completion seismicity guidelines for SCOOP and STACK operators to reduce risks related to fracking-induced earthquakes, according to a news release. In response, the Oklahoma Oil & Gas Association said its member companies "are ready to immediately implement" the new guidelines, which are intended to help manage and mitigate anomalous seismic activity that has occurred near oil and natural gas completion operations.

* President Barack Obama ordered an indefinite ban on offshore drilling in areas of the Arctic and Atlantic oceans, a "gift" to environmental groups with a month left before the Trump administration takes power. The Dec. 20 move, which covers 3.8 million acres in the Atlantic and 115 million acres in the Arctic, follows a ban put in place in the final draft of the 2017-2022 federal oil and gas offshore drilling plan.

* Alberta Investment Management Corp. agreed to acquire an approximately 28% ownership stake in Howard Energy Partners from EnLink Midstream Partners LP, according to a news release. The deal, which is expected to close in the first quarter of 2017, follows Alberta Investment's earlier purchase of up to $500 million of Howard Energy Partners' series B preferred units. Separately, EnLink Midstream closed the sale of approximately 140 miles of natural gas transportation pipeline in North Texas to Atmos Energy Corp. EnLink will receive $275 million from combined noncore asset sales.

* Kinder Morgan Inc.'s Elba Island LNG project, under construction near Savannah, Ga., received authorization from the U.S. Department of Energy to export 0.36 Bcf/d of natural gas to countries with which the U.S. does not have a free trade agreement.

* SandRidge Energy Inc. agreed to pay a $1.4 million penalty to settle charges in a whistleblower retaliation case at the SEC. However, the company neither admitted nor denied the SEC's findings that it used illegal separation agreements and retaliated against a whistleblower who expressed concerns internally about how the company calculated its oil and gas reserves.

* California Attorney General Kamala Harris and the California Coastal Commission filed a lawsuit to challenge the U.S. Department of the Interior's assessment that fracking off the coast of the state will not have a significant impact on marine life, ecosystems and coastal communities. The federal agency's "inadequate environmental assessment would open the door to practices like fracking that may pose a threat to the health and well-being of California communities," Harris said in a statement.

* KLR Energy Acquisition Corp. is merging with Tema Oil and Gas Co. to form a pure-play Delaware Basin company, dubbed Rosehill Resources Inc. The combined entity will have 4,771 net acres in the Delaware Basin, about 200 potential drilling locations on current leaseholds and expected net production of more than 6,000 barrels of oil equivalent per day in January 2017. The deal is expected to close in the first half of 2017.

* Former Chesapeake Energy Corp. COO Steven Dixon will join Tapstone Energy as CEO on Jan. 1, 2017, according to a news release. Dixon will replace Tom Ward, who founded Tapstone Energy and SandRidge Energy Inc. and co-founded Chesapeake Energy.


* Peabody Energy Corp. recorded net loss attributable to common stockholders of $161.6 million, operating loss of $94.7 million and total revenues of $504.4 million for the month ended Nov. 30, according to a Form 8-K filing.

* Cliffs Natural Resources Inc. is asking a judge to intervene in a dispute over $6 million with a conservationist who bought Cliffs' last coal mines. A Dec. 20 complaint said Seneca Coal Resources LLC, owned by conservationist and healthcare executive Tom Clarke, failed to comply with its post-closing bonding requirements and to pay Cliffs.

* Jera Co. Inc. subsidiary JERA Trading Singapore Pte. Ltd. agreed to acquire EDF Trading Ltd.'s coal and freight business. As part of the deal, EDF Trading will hold 33% of JERA Trading shares. At closing, JERA Trading is expected to have total physical coal sales of about 60 million tonnes per annum. The transaction is expected to close in early April 2017, according to a news release.

* Rep. Evan Jenkins, R-W.Va., introduced a resolution to force Congress to take an up-or-down vote on the Stream Protection Rule. The finalization of the rule, which could negatively affect coal companies' ability to mine near streams, was announced Dec. 19.


* Spectra Energy Corp.'s Algonquin Incremental Market project has given natural gas shippers more flexibility for delivering natural gas into New England, but as some have expected, the project falls short of satisfying the region's appetite for heating energy during very cold weather. Consisting of 37.6 miles of pipeline and 81,620 hp of additional compression, the project, also known as AIM, is designed to bring 342,000 Dth/d of additional natural gas capacity into the region.

* After shedding 12.9 cents Dec. 20 to settle at $3.263/MMBtu, January 2017 gas renewed gains overnight ahead of the Wednesday, Dec. 21, open, amid buying at lows and short covering driven by the anticipation of another impressive pull from stocks when the next weekly inventory data is released. At last look early Wednesday, the contract was up 7.5 cents to $3.338/MMBtu.

* Following a mixed session Dec. 21, falling demand forecasts should help pressure power dailies across the U.S. on Wednesday, Dec. 21, despite a slight recovery in the natural gas markets. At last glance, January 2017 natural gas was trading 8.0 cents higher at $3.343/MMBtu, reclaiming some of the 12.9 cents forfeited in the previous session but still down a whopping 40.3 cents since Dec. 9.

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New from RRA

* Mexico is primed to remain the U.S.' largest importer of natural gas for some years and is expected to fill the lion's share of its natural gas-for-generation needs from U.S. sources.


"I think it may be difficult for companies to comply. These aspects of their operations haven't been regulated in the past," attorney Eugene Elrod said about the U.S. Pipeline and Hazardous Materials Safety Administration's interim final rule governing underground gas storage.

The day ahead

* Early morning futures indicators pointed to a mixed opening for the U.S. equity markets. To view more SNL equity market indexes, click here. To view more SNL Energy commodities prices, click here.

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