Energy

Trouble in Paradise highlights U.S. coal’s dilemma

15 February 2019

The Kentucky power plant is one of two being closed because the fuel is no longer economical. Struggling supplier Murray Energy, run by a big Trump supporter, reckons overseas markets are its salvation. But they are unlikely to come to the rescue of the American industry.

Shell might win new energy race by wanting it more

15 February 2019

The UK oil major is acquiring German energy-storage group Sonnen. Utilities, carmakers and big tech groups are all converging on the residential-power market. Shell’s need to move quickly to hedge against peak oil demand may give it an edge.

Elliott kicks China’s EDP bid when it’s down

14 February 2019

The activist investor objected to China Three Gorges’ offer for the Portuguese utility. The deal was struggling, and Elliott’s plan, to invest in renewables, isn’t controversial. But the Chinese group’s large shareholding could still be a problem for Paul Singer’s fund.

Aramco’s new tangent more rational than it looks

12 February 2019

The Saudi oil giant wants to develop oil and gas projects overseas. Like its planned purchase of SABIC, that sits uneasily with other strategic goals. But emphasising lower-carbon gas while burnishing global credentials is sensible.

U.S. Green New Deal is at least a big idea

7 February 2019

The progressive Democrat plan envisages sweeping measures to combat climate change and a raft of social ills. It’s vague, flawed and hotly opposed by Republicans. But backer Alexandria Ocasio-Cortez has a knack for getting noticed – and a serious environmental debate is overdue.

Chevron climate pay plan may get more out of less

7 February 2019

The $230 bln oil giant is tying compensation to emissions cuts. The details may seem less ambitious than Shell’s, and pay is still partly linked to production. But the scheme targets methane, includes most Chevron workers and sets a potent challenge for U.S. rivals.

Total can pay up for Eneco – and may have to

7 February 2019

The French oil major could well bid for the Dutch utility. As annual results show, it has the financial heft to pay a big premium. Yet so does Shell, which is equally keen to diversify into power – and with the potential trump card of home advantage.

EQT fight shows never too late to fix a bad deal

5 February 2019

A merger with rival natural gas producer Rice always looked overambitious. It has turned out to be a total dud. Now Rice’s founders want control. Their plan looks like it could have saved EQT before the merger. Listening to them now isn’t ideal, but it’s better late than never.

BP beats Rosneft in valuation, not operations

5 February 2019

The UK oil major and the Russian group of which it owns 20 pct both delivered strong full-year results. But despite producing more with fatter margins, Rosneft trades on a much lower earnings multiple. Fears of tougher sanctions and exposure to Venezuela mean that will persist.

Breakdown: How to fix Venezuela

4 February 2019

The oil-rich Latin American country resembles a failed state. It may need $80 billion in loans and investment if embattled President Maduro departs. At 2013 pumping levels and $50 a barrel, that’s two years’ output for state oil firm PDVSA. A U.S. invasion would be a mistake.

Exxon’s earnings beat creates its own headwinds

1 February 2019

The $320 bln oil giant’s Guyana discoveries are swelling, Permian production is booming, and restructuring efforts are paying off. That helped it top quarterly earnings expectations. But CEO Darren Woods’ efforts are adding to a global oil glut, which will limit future success.

Falling prices only hurt Shell in the long term

31 January 2019

Despite a crude downturn in the final quarter, the UK oil major hiked output and earnings. Given prices should stay high enough for free cash flow to cover dividends, that’s sustainable. The main cloud is Shell and peers have less to invest to wean themselves off fossil fuels.

U.S. oil boom good for everything but profit

30 January 2019

Slowing growth and rising American production have knocked nearly 30 pct off Brent crude prices since October. Companies like Chevron and Exxon have responded by ramping up investment in the Permian, but that’s merely aggravating the glut – and making earnings growth elusive.

Hitachi jitters place UK nuclear at crossroads

11 January 2019

The Japanese group is set to freeze its Welsh Wylfa project, Nikkei says. The UK government can defend its view that nuclear provides secure and carbon-free power at an acceptable cost. But it will be politically tough to fill investment gaps if Hitachi steps back.

Hadas: Silly carbon tax talk hides hard choices

2 January 2019

The principle that higher prices reduce demand lies behind calls for levies on carbon dioxide emissions. But prices cannot do much in the large, complicated and economically crucial energy industry. Only big government, or major lifestyle adjustments, can really change things.

Brazil will get energy mostly right; Mexico won’t

28 December 2018

New regimes of opposing ideologies in Latam’s two biggest economies will wrestle with balancing 1970s-style nationalism against the need to open up to foreign and private capital to exploit their oil and gas resources. Brazil’s far-right president-elect has the better prospects.

World will improve where it matters most in 2019

24 December 2018

By next December, more people will have electricity and clean water. Child deaths are likely to be rarer and education more common. In future years, the pace of gains could accelerate. The open question is whether progress will undermine prosperity by also bringing more conflict.

China can afford some pipe dreams in 2019

20 December 2018

After years of speculation, Beijing will finally push behemoths like $200 bln PetroChina to spin off their pipelines next year. Allowing those oil and gas networks to run independently opens the field up to smaller competitors. It’s a major step towards energy market reform.

SSE comes off worse in energy M&A short-circuit

17 December 2018

The UK energy group’s plan to merge its retail unit with that of Germany’s Innogy collapsed, after a price cap undermined the transaction’s logic. Innogy can still do a deal with new owner E.ON. SSE’s transition to renewables looks murkier, and its generous payout more fragile.

Market forces put more coal in Trump’s stocking

12 December 2018

U.S. usage of the black stuff will hit a 39-year low and plant closings double in 2018 despite the president’s support. Cheaper natural gas and renewables are driving the trend, and will encourage other countries to follow. Miners will suffer but the world will breathe easier.