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In US LNG, Saudis may seek geopolitical win; top 12 coal firms shed market value

Q2: U.S. Solar and Wind Power by the Numbers

Essential Energy Insights - September 17, 2020

Essential Energy Insights September 2020

Rate case activity slips, COVID-19 proceedings remain at the forefront in August


In US LNG, Saudis may seek geopolitical win; top 12 coal firms shed market value

Top News

Companies adopting new climate disclosure framework see data gaps, other hurdles

Companies implementing a new international climate change reporting framework may find the heaviest lift involves crafting long-term scenario analyses of potential climate-related risks and opportunities, according to industry and climate disclosure experts.

Shutdown could hamper US EPA's efforts to lock in Trump's top energy rules

As the partial federal government shutdown over President Donald Trump's proposed U.S.-Mexico border wall stretches on, the rulemaking process at the U.S. Environmental Protection Agency has ground to a halt. And that could imperil some of the Trump administration's signature energy-related rulemakings, according to former top EPA officials with expertise on the policy process.

In US LNG, Saudis may seek geopolitical win, fuel with 'longer time horizon'

Saudi Arabia is reportedly nearing a decision to invest in U.S. liquefied natural gas export plants — a move that could further a shift in energy flows between the two countries while underpinning one or more of the American projects that backers hope to commercially sanction this year.

Market value of top 12 US coal producers down $2.11B since Q3'18

The 12 largest publicly traded U.S. coal producers lost 16.6% of their total market value since September 2018, with just one seeing an increase during the period. The companies' total market capitalization was $12.68 billion on Sept. 27, 2018, and $10.58 billion as of Jan. 8, 2019, according to data compiled by S&P Global Market Intelligence.

Schlumberger, Halliburton Q4'18 earnings should reflect weakening market

Fourth-quarter 2018 earnings for oilfield service majors Schlumberger Ltd. and Halliburton Co. are expected to trail the previous quarter and impact full-year 2018 results amid a combination of producer budget exhaustion, North America land pipeline capacity constraints and a crumbling crude oil price.

Quoted

"In a lot of ways it's kind of a no-brainer. It helps geopolitically. It helps diversify their economy. It helps reduce domestic subsidies. So for the Saudis it has a lot of advantages," Jason Feer, head of business intelligence at oil broker and ship broker Poten & Partners, commented' on reports that Saudi Arabia is nearing a decision to invest in U.S. LNG export plants.

Power

* Moody's downgraded PG&E Corp. and utility subsidiary Pacific Gas and Electric Co.'s credit ratings to junk status, citing mounting liabilities from recent California wildfires.

* California utility regulators agreed to examine how to divide the costs of wildfire liability between utilities and ratepayers so that safe and adequate electricity service is not impaired.

* S&P Global Ratings lowered its ratings on Berkshire Hathaway Energy's Topaz Solar Farm by five notches to B from BBB-, following the recent downgrade of PG&E Corp. and its utility Pacific Gas and Electric Co. The 550-MW solar facility receives all of its revenue from the PG&E Corp. utility under a long-term power contract.

* U.S. electric utilities and power producers issued approximately $79.46 billion of securities during 2018, up 3.5% from $76.74 billion in 2017, according to S&P Global Market Intelligence data.

* More than 600 environmental groups signed an open letter that calls on the U.S. House of Representatives to pursue the "Green New Deal" in order to transition away from fossil fuels to 100% renewable energy by 2035.

* During the week ended Jan. 10, solar and nonsolar renewable energy credit values were varied at market centers across the U.S. After sliding the week prior, vintage 2019 class I RECs in New Jersey were up 17 cents to an average of $6.24/MWh due to increased buying interest.

* A Wall Street Journal reconstruction of the 2017 cyberattack on the U.S. electric system shows that hackers attacked several unprotected small contractors and subcontractors instead of utilities and succeeded in planting malware on publication websites that were frequently visited by utility engineers.

* The solar sector landed $9.7 billion in total global corporate funding in 2018, a 24% drop the $12.8 billion raised in 2017, according to a new report from Mercom Capital Group LLC. The sector raised $1.3 billion in 65 global venture capital funding in 2018, an 18% drop from $1.6 billion in 99 deals in 2017.

Natural gas

* The potential for natural gas to play a bigger part in the U.S. energy portfolio will continue to drive investment in pipeline projects, especially in regions where politics or market forces have so far restrained such infrastructure, the new chairman of the Interstate Natural Gas Association of America said.

* U.S. oil and gas bankruptcies dropped to 43 filings in 2018, compared with 70 filings in 2017, the Houston Chronicle reported, citing law firm Haynes and Boone.

* The U.S. Department of Energy's Office of Fossil Energy is providing up to $88 million in federal funding for cost-shared research and development projects aimed at enhancing technologies for oil and natural gas recovery.

* A shareholder of American Midstream Partners LP urged the three independent directors to turn down private equity heavyweight ArcLight Capital Partners LLC's unsolicited offer to buy out the debt-ridden energy infrastructure partnership.

* The Royal Canadian Mounted Police and the Wet'suwet'en Hereditary chiefs reached an agreement over the enforcement of an interim injunction order to allow TransCanada Corp. workers to access a bridge for pre-construction work on the Coastal GasLink project, The Canadian Press reported.

* German Foreign Minister Heiko Maas said U.S. sanctions against Russia's planned $11 billion Nord Stream 2 gas pipeline project is a wrong approach and that any decision related to European energy policies "must be decided in Europe," Reuters reported.

* Targa Resources Corp. priced and upsized offering of $1.5 billion of senior unsecured notes to redeem its outstanding senior notes due 2019 in full and for general partnership purposes.

* Phoenix Petroleum Philippines Inc. has been given the green light to build the country's first LNG import terminal in partnership with China National Offshore Oil Corp., Reuters reported. The project, which is estimated to cost about $2 billion, is expected to an annual capacity of 2.2 million tonnes.

Oil

* The proposed IPO of stock in Saudi Arabian Oil Co., which has been through a series of hurdles and delays, inched closer to market as the massive state-owned oil producer intends to issue commercial bonds for the first time and released its first reserve estimates in decades.

* Canada's National Energy Board released draft conditions and recommendations to mitigate the potential risks of the Trans Mountain oil pipeline expansion project on the environment, The Canadian Press reported.

* After halting all drilling and well completions in Ohio in the third quarter of 2018, oil and gas producer Gulfport Energy Corp. is back in the game, filing three permits for new wells in liquids-rich Harrison County at the end of the year, according to the latest state data.

* EPIC Crude Pipeline LP is urging FERC to act on its petition for declaratory order for its crude pipeline from the Permian basin to Corpus Christi, Texas, by Jan. 15 after the federal regulators did not act on the requested Jan. 4 date. "This is placing our project timeline in some jeopardy, and causing concern to our shippers," the company wrote in a letter to FERC.

* Norway-based Equinor announced it has completed the acquisition of Chevron Corp.'s 40% stake in the Rosebank field in the U.K. No financial details were provided.

Coal

* Total U.S. coal production for the week ended Jan. 5 remained flat year over year at 11.9 million tons, according to data from the U.S. Energy Information Administration.

* Total U.S. coal rail traffic for the week ended Jan. 5 climbed 1.1% year over year to 70,807 carloads, according to data from the Association of American Railroads. BNSF Railway Co. coal shipment volumes clocked in at 29,004 carloads in the week ended Jan. 5, sliding 10.4% from the previous week's 32,357 carloads.

ChartWatch

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Ohio's new top gas producer, the privately held Ascent Resources, also based in Oklahoma City, pulled the most permits by far of any producer in December 2018, with 18. Ascent, with a C-suite stocked with executives who pioneered the Utica play while at Chesapeake Energy Corp., split those permits between three counties: dry gas Belmont and Jefferson counties and Guernsey County in the wet gas window.

New from RRA

* Missouri energy utility regulation is somewhat more restrictive than average from an investor perspective, according to Regulatory Research Associates, a group within S&P Global Market Intelligence.

The day ahead

* Early morning futures indicators pointed to a lower 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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Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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