Entries by Simon Lack

POTUS Should Have Called in Sick

SL Advisors Talks Markets
SL Advisors Talks Markets
POTUS Should Have Called in Sick



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For those wondering how the election will affect the energy sector, Thursday’s presidential debate offered some clarification but also added some uncertainty. Following Biden’s stuttering performance, he’s a poor bet to return to the White House after November. It must be more likely than not that his party will find a way to dump him […]

Monetary Policy Is Increasing The Deficit

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SL Advisors Talks Markets
Monetary Policy Is Increasing The Deficit



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Last week the Congressional Budget Office (CBO) released their latest ten year budget projection. It invariably makes for depressing, if unsurprising reading. Significant deterioration in our fiscal outlook is visible with every release. For example, in February we noted that one particular milestone, the year in which interest on the Federal debt exceeds $1TN, keeps […]

Cheniere Keeps Returning Cash

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SL Advisors Talks Markets
Cheniere Keeps Returning Cash



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Cheniere Energy Inc (CEI) has come a long way since its founding by Charif Souki in 1996. Three decades ago the US looked likely to be an importer of Liquefied Natural Gas (LNG) as demand outgrew dwindling domestic production. CEI planned to meet the gap with LNG imports. By 2008 the company’s LNG import terminal […]

Drilling Down On AI

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SL Advisors Talks Markets
Drilling Down On AI



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It says something about one company’s dominance of AI chips when a presentation on power demand growth starts with Nvidia’s revenue forecast. But that’s how John Schultz of the Advanced Data Center Consulting Group opened a recent webinar. Unit volumes can be derived from sales, and the number of chips being bought determines the amount […]

Serious Energy Forecasts Are Rare

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SL Advisors Talks Markets
Serious Energy Forecasts Are Rare



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The International Energy Agency (IEA) issued a report forecasting an oil glut by 2030, with 113.8 Million Barrels per Day (MMB/D) of supply capacity versus demand of only 105.4 MMB/D. They expect oil demand to plateau over the next few years. By contrast, OPEC sees continued demand growth, albeit slowing to around 1 MMB/D by […]

The Pipeline Outlook Keeps Improving

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SL Advisors Talks Markets
The Pipeline Outlook Keeps Improving



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The trend of positive assessments is continuing for the pipeline industry. Sell-side analysts are pressing the case for their favorite names. JPMorgan sees further upside for Targa Resources (TRGP) even though it’s returned 40% YTD. They have a $140 price target for the end of next year, up from ~$120 today. They cite a “fully […]

Another Inflation Omission

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SL Advisors Talks Markets
Another Inflation Omission



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The inflation statistics offer a rich trove of counterintuitive methods that often inspire this blogger. It’s an important issue because voters cite inflation, for which they blame Joe Biden, as one of their top concerns. Inflation reports show it’s coming down, although that doesn’t mean earlier price hikes are being reversed, simply that prices are […]

Blue State Energy Policies

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SL Advisors Talks Markets
Blue State Energy Policies



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Oregon is typical of many liberal states in that it is reviewing the infrastructure plans of the utilities it regulates. The concern is that too much capital will be invested in new natural gas infrastructure that will subsequently result in “stranded assets” as renewables reduce natural gas demand. The fear is that poor capex decisions […]

A Closer Look At Canada’s Newest Pipeline

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SL Advisors Talks Markets
A Closer Look At Canada’s Newest Pipeline



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I was perusing energy podcasts the other day. Disappointingly they all seemed to be about renewables – nothing about where over 80% of the world’s energy comes from today. Hopefully I started listening to one by Shell, but quickly realized it’s part of their PR campaign to convince people they’re fully committed to the energy […]

Picking The Top Pipeline

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SL Advisors Talks Markets
Picking The Top Pipeline



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Which is the best pipeline company? It depends on what you’re measuring. Income-seeking investors might focus on Distributable Cash Flow (DCF) yield or distribution (dividend) yield. Dividend coverage is usually important. Lowest leverage would provide comfort to those concerned about downside. Momentum investors will look at dividend growth – and few will ignore price performance. […]

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