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Warrior Met Coal kicks off IPO; 2 NJ gas utilities eyeing merger

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Warrior Met Coal kicks off IPO; 2 NJ gas utilities eyeing merger

Top News

In battle over solar's future, Pinnacle West reports $10M in political funding

In the latest move in a fierce battle over the future of solar power in one of the country's largest solar markets, Pinnacle West Capital Corp. released a list of what it says are shareholder-funded political contributions to various causes totaling nearly $10.4 million. The release comes as an Arizona utility regulator continues his efforts to learn whether electric ratepayers paid any of the money.

In battered oilfield services sector, wary optimism emerges

The good news for the U.S. oilfield services industry coming out of the commodity price trough in 2017 is that their independent shale driller clients ultimately won their multiyear standoff with OPEC. The bad news is the drillers did it by figuring out ways to produce more with less, leaving service providers in a state of uncertainty even as many drillers and pipeline companies return to a growth phase.

The 'New BTU': Largest US coal producer springs out of bankruptcy

Peabody Energy Corp. returned to the NYSE on April 4 fresh out of bankruptcy and riding a wave of optimism in the U.S. coal sector. The world's largest private-sector coal producer is the last of the giant coal miners in the U.S. to emerge from bankruptcy, joining old peers such as Arch Coal Inc. and surviving less fortunate companies such as Peabody spinoff Patriot Coal Corp. and sold-off metallurgical coal producer Walter Energy Inc.

Power

* Hydropower projects have become so difficult to permit that the industry no longer speaks of them as a viable source of electricity, President Donald Trump lamented during an April 4 townhall meeting.

* President Donald Trump administration is said to be seeking "an American or an allied buyer" for Westinghouse Electric Co. LLC's nuclear business in a bid to keep Chinese investors away from the Toshiba Corp. subsidiary, sources told Bloomberg News.

* A decision by Dominion Resources Inc. to miss a deadline to notify the ISO New England if it intends to retire its Millstone nuclear power plant has competitors warning that the Connecticut facility now is committed through May 2022 to supply power to the region's capacity market.

* The city of San Diego ranked first among 20 U.S. cities by total solar photovoltaic capacity installed by year-end 2016 with 303 MWdc, followed by Los Angeles at 267 MWdc, according to a new report from the Environment America Research & Policy Center. Meanwhile, Honolulu came in third on the list, but ranked first on per capita solar photovoltaic installed with 175 MWdc. The report noted that the 20 cities have "nearly 2 GW of solar PV capacity—nearly as much solar power as the entire country had installed at the end of 2010."

* Kauai Island Utility Cooperative is considering a deregulated or minimally regulated status in a bid to respond to member concerns and unexpected changes in fuel prices and market conditions, according to the co-op's Strategic Plan Update 2016-2030. The co-op is currently under the authority of the Hawaii Public Utilities Commission.

* One of the bidders for President Donald Trump's border wall with Mexico is proposing to build it with solar panels, The Associated Press reports. Gleason Partners LLC managing partner Thomas Gleason told AP that electricity sales to utilities could cover construction costs of the wall.

Natural gas/midstream

* New Jersey Resources Corp. is said to be in talks with South Jersey Industries Inc. to explore the possibility of merging the two natural gas utilities, The Wall Street Journal reported, citing "people familiar with the matter."

* Republicans in the Pennsylvania General Assembly left any severance tax on shale gas out of their version of the state budget when the GOP caucus in the state House released its financial plan April.

* Hess Midstream Partners LP priced an upsized initial public offering of 14,780,000 common units at $23 apiece. The units are expected to begin trading today on the NYSE under the ticker symbol "HESM," according to a news release. The partnership owns interests in North Dakota assets, including a natural gas gathering and compression system and a crude oil gathering system, and a natural gas processing and fractionation plant, among others.

* A Brookfield Infrastructure LP-led consortium completed the acquisition of a 90% ownership interest in a South American natural gas transmission utility for a total consideration of $5.2 billion. The consortium acquired the stake in Nova Transportadora do Sudeste SA from Petroleo Brasileiro SA. "We are deploying approximately $1.3 billion at closing to significantly expand our utilities business in a sector and geography that we know well, where we will earn strong risk-adjusted returns," said Brookfield Infrastructure CEO Sam Pollock in a statement.

* Carbon Natural Gas Co. and two institutional investors formed Carbon Appalachian Co. LLC to acquire producing assets in Southern Appalachia, according to a news release. Carbon Appalachia has an initial equity commitment of $100 million. Concurrently, the company closed a $20 million deal to acquire natural gas producing properties and related facilities in Tennessee.

* Four bipartisan lawmakers, including Rep. Jared Huffman, D-Calif., and Rep. Brian Fitzpatrick, R-Pa., introduced a bill to designate the Arctic National Wildlife Refuge on the north coast of Alaska "as wilderness, codifying into law permanent protections from damaging activities like oil and gas drilling," Huffman said in a news release.

* A New Jersey township has sued Transcontinental Gas Pipe Line Co. LLC over a land sale connected with an expansion of the Transco natural gas pipeline system. Court filings could not be obtained by press time, but the company said the suit is baseless.

* An American Midstream Partners LP subsidiary secured the approval of FERC to place its $60 million Midla Natchez pipeline into service. The 55-mile pipeline extends from Winnsboro, La. To Natchez, Miss. and has capacity to deliver 50,000 dekatherms/day, the partnership said.

* A survey conducted by law firm Haynes and Boone LLP found that executives in the energy and finance space have a positive outlook on upcoming borrowing base redeterminations. According to report, respondents expect a smaller percentage of E&P borrowers to see a decrease in their borrowing base redeterminations in spring 2017.

* Citing depressed LNG prices, Resources Energy Inc. has decided to halt development of the Cook Inlet LNG plant in Alaska, the Alaska Journal of Commerce reports. Resources Energy is a consortium of Japanese companies and municipal governments that are interested in Alaska's natural gas.

* Edge Natural Resources LLC's private equity fund ENR Partners II LP secured $650 million in total commitments, according to a news release. The fund is targeting investments in upstream and oilfield service transactions requiring between $25 million and $75 million in equity capital.

Coal

* Warrior Met Coal LLC launched its initial public offering of 16,666,667 common shares at an anticipated price between $17 and $19, according to a news release. The shares are being offering by selling stockholders, who also plan to grant the underwriters a 30-day option to purchase up to an additional 2.5 million shares. Warrior Met Coal is a producer and exporter of metallurgical coal operating in northern Alabama.

* Coal exports from the Hampton Roads port facilities in Virginia registered a healthy growth of 111.6% year over year, to 3.3 million tons in March, and climbed 18.7% compared to February's total, according to data obtained April 4 from the Virginia Maritime Association.

* The federal agency in charge of cleaning up former coal mining sites has failed to ensure that states are properly using grant money intended for reclamation projects, a federal evaluation determined.

* The U.S. Mine Safety and Health Administration needs to provide better oversight of emergency response plans, according to an audit conducted by federal inspectors. "The ERPs we reviewed were inadequate in one or more ways and placed miners at unnecessarily increased risk during an emergency," according to a summary report by the U.S. Department of Labor's Office of Inspector General.

Commodities

* Natural gas working storage capacity was up slightly from November 2015 to November 2016, led by growth in the South Central region, where several facilities reached new five-year maximum levels, the U.S. Energy Information Administration said.

* After climbing by 16.5 cents on Tuesday to settle at $3.293/MMBtu, NYMEX May natural gas futures pulled back overnight ahead of the Wednesday, April 5, open, as traders considered expectations for the early start of the injection season and a warming trend in forecasts that should dampen demand and allow for a ramp up in the pace of storage-building. At 7:11 a.m. ET (1111 GMT) the contract was 2.3 cents lower at $3.269/MMBtu after trading a range of $3.267/MMBtu to $3.295/MMBtu.

* Power dailies could advance Wednesday, April 5, as predominantly stronger demand expectations are joined by a recent rally at the natural gas futures arena. Surging more than 16 cents in the prior trading day, front-month May natural gas futures were trading down slightly ahead of the opening bell at midweek.

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New from RRA

* Citing high earned ROEs and returns earned in neighboring states, the Massachusetts attorney general questioned the need for NSTAR Electric Co. and Western Massachusetts Electric Co. to increase rates.

Quoted

"Truth be told, FERC's really important to everybody in this room, but outside this room, how important is FERC?" said Michael McKenna, former head of the U.S. Department of Energy transition team, on the delay in appointing new FERC commissioners.

The day ahead

* Armstrong Energy Inc. will hold its fourth-quarter 2016 earnings conference call at 11 a.m. ET.

* 8point3 Energy Partners LP will hold its first-quarter 2017 earnings conference call at 4:30 p.m. ET.

* 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.

The Daily Dose is updated as of 7:30 a.m. ET. Some links may require registration or a subscription.