Oneok (OKE) is developing a habit of surprising the market with their acquisitions. Last year’s deal with Magellan Midstream (MMP) was roundly criticized, including by us, because of few obvious synergies and an unwelcome tax bill for MMP unitholders (see Oneok Does A Deal Nobody Needs). MMP’s refined products business didn’t look like a […]
Investors sometimes ask us what induces us to sell a security. It’s usually because relative valuation has made one stock more attractive than another. Williams Companies (WMB) is an example. The company holds a unique position in natural gas pipelines with its Transco network running along the eastern US. They have a heavily fee-based business, […]
Rivian’s R1T truck has a special storage compartment for golf clubs. Nothing else so eloquently describes the conundrum facing the auto industry. America is not an obvious market for EVs. It’s a vast place, so we drive greater distances. Gasoline is cheaper than in other developed countries. And we like big cars – two thirds […]
I traveled from San Diego to Portland, OR last week and enjoyed a delicious wine pairing dinner in nearby Oswego with a group of investors. Oregon is wine country, and its residents are knowledgeable about varietals and vintages. I met some people who cultivate vines as a hobby and enjoy producing enough to fill a […]
2Q midstream earnings have come in mostly at or ahead of expectations. Oneok had a strong quarter and are expected to raise full year EBITDA guidance in November. Targa Resources also beat analyst estimates and raised full year guidance. Cheniere beat expectations and once again raised full year guidance, something that is becoming a regular […]
US natural gas and its related infrastructure isn’t the only beneficiary of the AI-driven boom in power demand. Utility stocks have been rising, as investors assess growing power demand will boost earnings. The S&P Utilities Index is several per cent ahead of the S&P500 this year. Operators of data centers well understand the challenges they […]
Once again a liberal activist judge has succumbed to a far-left climate extremist group. On Tuesday DC Circuit Chief Judge Srinivasan, along with Circuit Judges Childs and Garcia sent parts of a previously granted permit from the Federal Energy Regulatory Commission (FERC) back for review. NextDecade’s (NEXT) Rio Grande LNG export terminal was one of […]
It looks like a big margin call started in Japan. The Japanese Yen has become a funding currency in recent years, a source of cheap financing with the proceeds reinvested in better returning assets – such as US$ listed AI stocks. Debtors benefit when the currency in which they’ve borrowed depreciates. The Yen offered low […]
US natural gas is the cheapest in the world. December TTF futures on the European benchmark are $13 per Million BTUs (MMBTUs). The Asian JKM benchmark is $12.50. The US Henry Hub December futures are at $3.15. Fracking has become ever more efficient, allowing production to continue even at prices that seem ruinous. Range Resources […]
One casualty of the shale revolution was the MLP financing model. The General Partner (GP) would typically direct its MLP to finance assets that were “dropped down” from the GP. MLP capex and M&A more than tripled from 2010 to 2015. Cash returns too often came up short of those promised, and investors lost confidence […]
