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Duke Energy acquires REC Solar; Drillers have clear path to production increases

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Duke Energy acquires REC Solar; Drillers have clear path to production increases

Top News

Duke Energy puts its money on 'behind-the-meter' business with REC Solar deal

Duke Energy Corp. is taking a cue from the market and fulfilling its plan to build up a "behind-the-meter" renewable energy portfolio through the acquisition of a California solar provider.

US oil drillers have clear path to production increases amid OPEC's restraint

When OPEC announced a deal in 2016 for production cuts of about 1.8 million barrels per day, U.S. producers were quick to fill the void, pushing down oil prices in the process. With the cartel extending its cuts through 2018, the Americans are more likely to stage a repeat that puts a ceiling on prices than to keep output steady, industry observers said.

Left out of tax bills, carbon capture credits have 1 more shot at passage

A legislative package that would extend a variety of federal energy tax credits likely represents the best chance for advocates hoping to see carbon capture credits renewed this year.

Power

* Public Service Co. of New Mexico agreed to examine the possibility of joining the Southwest Power Pool or another regional transmission entity in conjunction with studying potential membership in an energy imbalance market in response to an inquiry from state regulators.

* Volta Energy Technologies has launched a new model for advancing and financing energy storage technologies. Exelon Corp. and Albemarle Corp. are founding strategic investors of Volta, according to a news release.

* Private power plant operator Northern Star Generation LLC has notified the PJM Interconnection of its intent to close the 110-MW Colver Power Project waste coal plant in September 2020, once its power supply contract with local utility Pennsylvania Electric Co. ends.

* A whistleblower told congressional investigators that former National Security Adviser Michael Flynn texted a former business associate that a plan to build nuclear power reactors in the Mideast was "good to go," The Associated Press reported. Flynn also told the business associate that the U.S. sanctions that stymied the project would soon be "ripped up," AP added.

* Global Technical Systems is investing $54.7 million to build an electro-mechanical energy storage system manufacturing operation in the city of Virginia Beach, Va. Gov. Terry McAuliffe approved a $1.8 million grant from the state's opportunity fund to assist the city with the project.

* Whitefish Energy Holdings LLC reached a settlement with subcontractor Arc American of Indiana over a payments dispute tied to Puerto Rico's grid work, The Associated Press reported. Whitefish made headlines after it won and lost a controversial $300 million grid repair contract from the Puerto Rico Electric Power Authority.

* The New York State Energy Research and Development Authority and the New York Power Authority allotted $3.8 million to launch an initiative to help stimulate financing and installation of large-scale geothermal systems at state and local governmental entities, public and private schools and healthcare facilities.

* A prototype nuclear fusion reactor being built in southern France is facing delays due to the Trump administration's plan to lower its contribution to the project, Reuters reported. The European Union shoulders the bulk of construction costs of the ITER project, with the remainder equally shared by China, India, Japan, Korea, Russia and U.S. at 9.1% each.

Natural gas/Oil

* Utica Shale drillers continue to focus on the dry gas window of the play in southeastern Ohio, according to November permitting data from the Ohio Department of Natural Resources, but one big player, Antero Resources Corp., has shifted to wet Marcellus wells as NGL prices improve.

* Chevron Corp. announced an $18.3 billion capital and exploratory spending program for 2018. "We're fully funding our advantaged Permian Basin position and dedicating approximately three-quarters of our spend to projects that are expected to realize cash flow within two years," said Chairman and CEO John Watson.

* Andeavor, the refining giant built through the combination of Tesoro Corp. and Western Refining Inc., is reassuring investors that its midstream master limited partnership has the ability to self-fund its equity needs, but not all analysts were persuaded by the company's Dec. 5 growth plan presentation.

* Bill Barrett Corp. has agreed to combine with Fifth Creek Energy Co. LLC in an approximately $649 million deal that would create an exploitation and production company exclusively focused on oil-weighted rural areas in the Denver-Julesburg Basin. The companies will have a combined acreage position of approximately 151,100 net acres and an inventory of 2,865 highly economic future drilling locations.

* The Alberta government, together with the Alberta Energy Regulator, made changes to Directive 67 that will put greater scrutiny on officials from companies that walk away from oil and gas infrastructure without cleaning it up. "We're taking action to protect Albertans and the environment by ensuring consequences for those who try to get around the 'polluter-pays' principle," said Margaret McCuaig-Boyd, Minister of Energy.

* Colorado has suffered at least a dozen fires and explosions at oil and gas facilities in the state since the fatal Firestone disaster in April, The Denver Post reported, citing state records. But the new rules proposed in response to the Firestone explosion do not address fatalities caused by such accidents, and the Colorado Oil and Gas Conservation Commission still lacks the authority to punish the concerned companies, the Post noted.

* Alberta's carbon tax is expected to cost large industrial emitters, including oilsands operations, C$1.2 billion a year by 2020, according to the Calgary Herald. But the government plans to implement a system of credits to address concerns on maintaining global competitiveness.

* Baker Hughes, a GE company, LLC priced senior notes offerings totaling $3.95 billion. The company plans to use net proceeds to fund tender offers for outstanding debt securities.

* Exxon Mobil Corp. has sent its first fuel shipment to Mexico from its Beaumont, Texas, refinery, Bloomberg News reported. The company shipped two cargoes totaling 120,000 barrels of diesel and gasoline.

* ConocoPhillips and its partner Anadarko Petroleum Corp. were the bidding group in the annual lease sale for the National Petroleum Reserve-Alaska, the Anchorage Daily News reports. The companies bid for seven tracts out of the 900 offered under the lease sale.

* The Desjardins Group has lifted a moratorium on energy pipeline project loans and has adopted an environment, social and governance criteria for business decisions, The Canadian Press reported.

Coal

* The export market for U.S. thermal coal continues to gain strength but is likely only a temporary boost given the bearish long-term fundamentals for domestic consumption, several speakers at an industry event said Dec. 5.

* One of the two men indicted in the death of former Patriot Coal Corp. President and CEO Bennett Hatfield went on trial Dec. 4 on charges of first-degree murder, robbery and conspiracy.

* Nippon Steel & Sumitomo Metal Corp. anticipates coking coal prices to stay above $200/ton through the three-month period ending March, 31, 2018, Reuters reported.

Commodities

* The weekly natural gas inventory report to be released by the U.S. Energy Information Administration at 10:30 a.m. ET on Thursday is expected to outline a modest pull from stocks for the week to Dec. 1.

* After advancing by a meager 0.8 cent to a finish at $2.922/MMBtu in the prior session, NYMEX January 2018 natural gas futures lost footing overnight ahead of the Thursday, Dec. 7, open, as bearish storage expectations undermined lingering weather support. At 6:40 a.m. ET (1140 GMT) the contract was 9.1 cents lower at $2.831/MMBtu.

* Following a session of mostly gains at midweek, next-day power prices could run mixed Thursday, Dec.7, as traders look to varied demand forecasts for week's end and potential volatility in natural gas.

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New from RRA

* In a final order issued by the Illinois Commerce Commission on Dec. 6, Ameren Corp. subsidiary Ameren Illinois Co. was ordered to implement a $16.4 million, or 1.6%, electric distribution revenue requirement reduction in the company's annual formula rate plan proceeding.

Quoted

"Our health, environment and global climate are actively being destroyed. And it is clear to me that EPA Administrator Scott Pruitt and President Trump are accelerating and cheering on the damage. I have come here today to ask you to stop. For the sake of my grandchildren and yours, I call on you to strengthen, not repeal, the Clean Power Plan," Harlan County, Ky., coal miner Stanley Sturgill testified at the hearing on the EPA's repeal of the plan in Charleston, W.V.

The day ahead

* The EIA natural gas storage report is due out today.

* 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.