Not willing to commit more capital to the production of natural gas, EOG Resources Inc (NYSE:EOG) had its share price plunge as the cut their production estimates. Citigroup downgraded them from "Buy" to "Hold" in response.
Most of this is driven by the depressed prices of natural gas, which at least in the short term, aren't going to be moving up.
Natural gas companies with heavy exposure have been transferring capital to the oil sector or liquefied natural gas segment, which generate stronger margins and earnings at this time.
Even with lower production estimates, some question if EOG has the capital to pull it off.
EOG closed Wednesday at $88.64, plummeting $9.10, or 9.31 percent. Citigroup slashed their price target from $110 to $95.
Showing posts with label Liquefied Natural Gas. Show all posts
Showing posts with label Liquefied Natural Gas. Show all posts
Thursday, November 4, 2010
Monday, October 25, 2010
Citigroup (NYSE:C) Says Conditions Surrounding Santos Gas Project Approval Manageable
Approval of the natural gas project of Santos Ltd is based on certain conditions, which Citigroup (NYSE:C) shouldn't be too burdensome to the company and the project.
Some of the conditions for the $17.6 billion project include a possible increase in the water monitoring requirements and regulators keeping a closer watch over the Gladstone liquefied natural gas venture.
Citigroup said together the additional cost should come to about A$20 million, which compared to the overall capital expenditure total is relatively small.
Gas will be liquefied from the project and exported to Asian markets.
Some of the conditions for the $17.6 billion project include a possible increase in the water monitoring requirements and regulators keeping a closer watch over the Gladstone liquefied natural gas venture.
Citigroup said together the additional cost should come to about A$20 million, which compared to the overall capital expenditure total is relatively small.
Gas will be liquefied from the project and exported to Asian markets.
Wednesday, September 1, 2010
PetroChina (NYSE:PTR) Building Tibetan Liquefied Natural Gas Project
PetroChina (NYSE:PTR), which is the subsidiary of China National Petroleum Corp, will be building a liquefied natural gas project in Tibet.
The capital city of Tibet, Lasa, will be the location of the project and destination of the gas.
Once that project is completed, expectations are the project will expand to other cities in Tibet.
The first step in the process will be to build a liquefied natural gas terminal, which will be able to receive the product, which will come from the Qunghai Province of China.
Next they're going to build a natural gas network throughout the city of Lasa, and finally, they'll put together a refueling network around the city.
Liquefied natural gas should start supplying Lasa by October 2011.
For those without much knowledge of India/China relations, this could be considered a threat by India, who has been getting nervous over the increased military presence of China in Tibet, and could be more of an effort to supply energy for them than the stated purpose of increasing the use of natural gas in the mountainous country.
The capital city of Tibet, Lasa, will be the location of the project and destination of the gas.
Once that project is completed, expectations are the project will expand to other cities in Tibet.
The first step in the process will be to build a liquefied natural gas terminal, which will be able to receive the product, which will come from the Qunghai Province of China.
Next they're going to build a natural gas network throughout the city of Lasa, and finally, they'll put together a refueling network around the city.
Liquefied natural gas should start supplying Lasa by October 2011.
For those without much knowledge of India/China relations, this could be considered a threat by India, who has been getting nervous over the increased military presence of China in Tibet, and could be more of an effort to supply energy for them than the stated purpose of increasing the use of natural gas in the mountainous country.
Tuesday, July 20, 2010
Apache (NYSE:APA), Chevron (NYSE:CVX), KUFPEC in KOGAS Deal
Chevron (NYSE:CVX), Apache (NYSE:APA) and Kuwait Foreign Petroleum Exploration Co (KUFPEC), have made a deal with Korea Gas Corporation for the purpose of acquiring liquefied natural gas.
The liquefied natural gas will be acquired from Australian-based Wheatstone project in Western Australia, according to the companies involved.
KUFPEC and Apache, who have equity stakes in the fields which supply Wheatstone, have plans to sell 5 percent of those stakes.
KOGAS has committed to acquiring 1.5 million tons of liquefied natural gas annually, with 75 percent of the gas provided by Chevron, which operates Wheatstone, and close to 25 percent from KUFPEC and Apache.
The assets being sold by Apache and KUFPEC are from the Julimar and Brunello fields, which account for the 5 percent mentioned above. When completed, KOGAS will have a 5 percent stake in the overall Wheatstone project.
The liquefied natural gas will be acquired from Australian-based Wheatstone project in Western Australia, according to the companies involved.
KUFPEC and Apache, who have equity stakes in the fields which supply Wheatstone, have plans to sell 5 percent of those stakes.
KOGAS has committed to acquiring 1.5 million tons of liquefied natural gas annually, with 75 percent of the gas provided by Chevron, which operates Wheatstone, and close to 25 percent from KUFPEC and Apache.
The assets being sold by Apache and KUFPEC are from the Julimar and Brunello fields, which account for the 5 percent mentioned above. When completed, KOGAS will have a 5 percent stake in the overall Wheatstone project.
Wednesday, April 14, 2010
Petrohawk Energy (NYSE:HK), Kinder Morgan (NYSE:KMP) in Joint Venture
Petrohawk Energy (NYSE:HK) announced it'll be selling its 50 percent stake in its Haynesville Shale project to Kinder Morgan Energy Partners (NYSE:KMP). The Haynesville Shale project include the extracting and processing side of the business.
As a result of the $875 million deal, the two companies will form a partnership for the project.
Petrohawk has been selling off some of its assets this year, which so far has reached $1.4 billion in order to increase its liquidity, in order to focus on this very Haynesville property, along with the Eagle For shale project.
Capital raised from the deal will be used by Petrohawk to work on and expand its drilling programs, according to CEO and Chairman Floyd Wilson.
Wilson said this will probably be the last deal like this for 2010, possibly because it exceeded expectations by over $200 million.
Separate from this deal, Petrohawk has also been migrating capital toward the Eagle Ford project to increase oil production in order to diversify its assets because of the abundance of natural gas which is bringing prices down.
The new company, named KinderHawk Field Service, will be valued at close to $1.75 billion at the close of the deal. Until then, Petrohawk will continue to operate the business.
As a result of the $875 million deal, the two companies will form a partnership for the project.
Petrohawk has been selling off some of its assets this year, which so far has reached $1.4 billion in order to increase its liquidity, in order to focus on this very Haynesville property, along with the Eagle For shale project.
Capital raised from the deal will be used by Petrohawk to work on and expand its drilling programs, according to CEO and Chairman Floyd Wilson.
Wilson said this will probably be the last deal like this for 2010, possibly because it exceeded expectations by over $200 million.
Separate from this deal, Petrohawk has also been migrating capital toward the Eagle Ford project to increase oil production in order to diversify its assets because of the abundance of natural gas which is bringing prices down.
The new company, named KinderHawk Field Service, will be valued at close to $1.75 billion at the close of the deal. Until then, Petrohawk will continue to operate the business.
Thursday, April 8, 2010
JPMorgan (NYSE:JPM) Deal with Cheniere Energy (AMEX:LNG)
JPMorgan Natural Gas Deal with Cheniere Energy
A number of banks have been moving into the natural gas sector, and that's true with JPMorgan (NYSE:JPM), as evidenced by their deal with (AMEX:LNG).
The deal entails importing liquefied natural gas, which while having long term potential, in the short term will put downward pressure on teh profits of JPMorgan.
I'm a long-term investor, so that doesn't bother me in the least, but for those only looking at the short-term, it will be a challenging deal to absorb.
This is the result of the continuing fall of natural gas prices in the United States, which shows no sign of abating any time soon.
How the deal will work, is JPMorgan will jointly buy natural gas cargoes with Cheniere from overseas markets and resale them in the U.S. market. Both will share in any profits or losses incurred from the arrangement.
With the growing number of gas-shale opportunities within the United States, it is becoming more difficult to acquire import loads at a price that will make sense or be profitable.
Adding the balance sheet of JPMorgan to the mix does make it more probable they can make larger acquisitions which could result in lower prices which would make sense at that time.
Either way, this is a long term play, which will demand a lot on the domestic natural gas supply in the U.S., which shows no sign of abating.
JPMorgan competitors like Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS) have also entered the natural gas market in anticipation of growing demand. But as long as supply is so available, this shouldn't do much to increase the profits at the companies, but does position them for the day when the supply/demand situation changes.
A number of banks have been moving into the natural gas sector, and that's true with JPMorgan (NYSE:JPM), as evidenced by their deal with (AMEX:LNG).
The deal entails importing liquefied natural gas, which while having long term potential, in the short term will put downward pressure on teh profits of JPMorgan.
I'm a long-term investor, so that doesn't bother me in the least, but for those only looking at the short-term, it will be a challenging deal to absorb.
This is the result of the continuing fall of natural gas prices in the United States, which shows no sign of abating any time soon.
How the deal will work, is JPMorgan will jointly buy natural gas cargoes with Cheniere from overseas markets and resale them in the U.S. market. Both will share in any profits or losses incurred from the arrangement.
With the growing number of gas-shale opportunities within the United States, it is becoming more difficult to acquire import loads at a price that will make sense or be profitable.
Adding the balance sheet of JPMorgan to the mix does make it more probable they can make larger acquisitions which could result in lower prices which would make sense at that time.
Either way, this is a long term play, which will demand a lot on the domestic natural gas supply in the U.S., which shows no sign of abating.
JPMorgan competitors like Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS) have also entered the natural gas market in anticipation of growing demand. But as long as supply is so available, this shouldn't do much to increase the profits at the companies, but does position them for the day when the supply/demand situation changes.
Tuesday, March 23, 2010
BG Group (LSE:BG) $80 Billion Deal with China National Offshore Oil Corp
BG Group in Huge Natural Gas Deal with China
BG Group (LSE:BG) is about to sign a major deal worth from $50 billion to up to $80 billion with China National Offshore Oil Corp for a liquified natural gas agreement.
If prices are close to last years' prices, the deal would be close to the higher end of $80 billion.
This is why Australia and China have been working hard behind the scenes to patch up their relationships, as this follows a deal with PetroChina and Royal Dutch Shell for Arrow Energy, also based in Australia for $3.4 billion. That was for coal-seam gas.
BG Group in Huge Natural Gas Deal with China
BG Group (LSE:BG) is about to sign a major deal worth from $50 billion to up to $80 billion with China National Offshore Oil Corp for a liquified natural gas agreement.
If prices are close to last years' prices, the deal would be close to the higher end of $80 billion.
This is why Australia and China have been working hard behind the scenes to patch up their relationships, as this follows a deal with PetroChina and Royal Dutch Shell for Arrow Energy, also based in Australia for $3.4 billion. That was for coal-seam gas.
BG Group in Huge Natural Gas Deal with China
Monday, March 15, 2010
Exxon Mobil (NYSE:XOM) Financing Secured for Esso Highlands
Exxon Mobil Esso Highlands Financing
Exxon Mobil (NYSE:XOM) announced the financial arrangements for the Esso Highlands project in Papua New Guinea is complete, with an estimated $15 billion in investment in the first round.
The project entails liquefied natural gas, which includes Exxon Mobil partners Santos Ltd. and Oil Search Ltd., which have secured agreements with its lenders and customers of LNG.
Esso Highlands has a 33.2 percent stake in the venture.
Exxon Mobil Esso Highlands Financing
Exxon Mobil (NYSE:XOM) announced the financial arrangements for the Esso Highlands project in Papua New Guinea is complete, with an estimated $15 billion in investment in the first round.
The project entails liquefied natural gas, which includes Exxon Mobil partners Santos Ltd. and Oil Search Ltd., which have secured agreements with its lenders and customers of LNG.
Esso Highlands has a 33.2 percent stake in the venture.
Exxon Mobil Esso Highlands Financing
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