VANCOUVER, B.C. - In the footsteps of investments by the British Columbian government, Encana Corp. and TransCanada Corp., Spectra Energy Corp, a U.S. gas infrastructure company, has announced plans to start a pipeline crossing project at the Salmon River in British Columbia.
Discussions with the B.C. Ministry of Environment and Fisheries and Oceans are still ongoing, according to Spectra’s manager of community and aboriginal relations, as the company deals with concerns expressed by various groups.
The project plan is to start construction in the third week of June. Construction of the river bore is expected to take about six months to complete. Spectra will drill a “pilot hole” to a depth of approximately 20 meters under the Salmon River, and then pull the pipeline through that pilot hole after it is enlarged.
Spectra is the third largest natural gas pipeline company in North America. It is expanding its gathering and processing capacity to accommodate gas from the Horn River shale, and adding storage caverns along the U.S. Gulf Coast.
Between 2009 to 2012, Spectra plans a number of expansion projects to increase gathering and processing capacity in Fort Nelson, B.C., in order to accommodate gas from the Horn River basin. The company reports firm “take or pay” initial commitments from eight customers totaling 750 mmcf/day.
Friday, May 29, 2009
Thursday, May 28, 2009
Report from U.S. CFR contends claims of oil sands pollution overstated
NEW YORK - A new report from the Council on Foreign Relations (CFR) – “The Canadian Oil Sands: Energy Security vs. Climate Change” - contends that prudent greenhouse gas regulations can limit emissions from Canadian oil sands while still enabling development of the energy resource.
The report argues that oil sands production delivers both energy security benefits and climate change damages, but warns that both are often overstated. “For the near future, the economic and security value of oil sands expansion will likely outweigh the climate damages that the oil sands create,” it says, “but climate concerns cannot and must not be ignored, and will become more important over time.”
Policymakers, the report warns, must carefully balance the two concerns.
Smart regulation can place a fair and reasonable price on the oil sands’ greenhouse gas emissions, providing the right incentive to reduce them, but ill-conceived regulation could undermine U.S. and Canadian climate and security goals.
Michael A. Levi, CFR’s David M. Rubenstein senior fellow for energy and the environment, and the report’s author, argues that it is important to integrate U.S. and Canadian cap-and-trade systems, while warning against the risks of a Canada-only cap-and-trade scheme and against an ill-designed U.S. low-carbon fuel standard.
In the contentious debate about oil sands, some argue that the U.S. should discourage the development of oil sands because its operations generate more climate-damaging greenhouse gas emissions than conventional oil production. Others argue that the U.S. should actively encourage their development because it would strengthen U.S. energy security with a supply of oil from a friendly and stable neighbor.
The report argues that oil sands production delivers both energy security benefits and climate change damages, but warns that both are often overstated. “For the near future, the economic and security value of oil sands expansion will likely outweigh the climate damages that the oil sands create,” it says, “but climate concerns cannot and must not be ignored, and will become more important over time.”
Policymakers, the report warns, must carefully balance the two concerns.
Smart regulation can place a fair and reasonable price on the oil sands’ greenhouse gas emissions, providing the right incentive to reduce them, but ill-conceived regulation could undermine U.S. and Canadian climate and security goals.
Michael A. Levi, CFR’s David M. Rubenstein senior fellow for energy and the environment, and the report’s author, argues that it is important to integrate U.S. and Canadian cap-and-trade systems, while warning against the risks of a Canada-only cap-and-trade scheme and against an ill-designed U.S. low-carbon fuel standard.
In the contentious debate about oil sands, some argue that the U.S. should discourage the development of oil sands because its operations generate more climate-damaging greenhouse gas emissions than conventional oil production. Others argue that the U.S. should actively encourage their development because it would strengthen U.S. energy security with a supply of oil from a friendly and stable neighbor.
Wednesday, May 27, 2009
Illinois Commerce Commission tells Enbridge to go make peace with landowners
SPRINGFIELD - The Illinois Commerce Commission (ICC) has thrown a wrench into the well-oiled plans of Enbridge Energy to build a 170-mile pipeline, ordering it to reach an agreement with upset property owners.
The board said the pipeline's path makes sense, but wouldn't grant Enbridge eminent domain to take land to lay its pipe.
A group of 200 landowners near Bloomington, Ill., are refusing to sign an agreement with the company for putting the pipeline on their property.
Back in February, the ICC said Enbridge could get eminent domain, but now more talks are needed.
Delays are pushing construction on the half-billion dollar pipeline back a year.
Building could start in 2010.
The board said the pipeline's path makes sense, but wouldn't grant Enbridge eminent domain to take land to lay its pipe.
A group of 200 landowners near Bloomington, Ill., are refusing to sign an agreement with the company for putting the pipeline on their property.
Back in February, the ICC said Enbridge could get eminent domain, but now more talks are needed.
Delays are pushing construction on the half-billion dollar pipeline back a year.
Building could start in 2010.
Tuesday, May 26, 2009
Enbridge Energy environmental assessment available for comment
MADISON, Wis. – Environmental officials in Wisconsin have invited the public to comment on an Environmental Assessment (EA) prepared by the Department of Natural Resources (DNR) for the Enbridge Alberta Clipper petroleum pipeline system project.
Enbridge Energy Co. of Superior has applied to the Wisconsin DNR for waterway and wetland crossing permits and air quality permits for the proposed project. The company will also need a stormwater permit and an endangered resources review for the project.
The proposed project consists of constructing a new 36-inch diameter petroleum pipeline known as the Alberta Clipper, a new 20-inch diameter diluent return pipeline known as the Southern Lights, an associated pump station for the Southern Lights pipeline and five 250,000-barrel breakout tanks. The proposed pipelines would be constructed along a 13-mile route in Douglas County from the Wisconsin-Minnesota border to the Enbridge Superior Terminal in Superior.
It requires 17 water body crossings, including 10 tributaries to the Pokegama River, three un-named waterways, two tributaries to the Little Pokegama River, one crossing of the Pokegama River and one crossing of an unnamed tributary to the Nemadji River.
The proposed pipelines would temporarily impact approximately 75 acres of wetland.
The pump station and breakout tanks at the Superior Terminal would fill approximately 12 acres of wetland and temporarily impact approximately three acres of wetland.
The project as proposed is not anticipated to result in significant adverse environmental effects, according to DNR officials. DNR has made a preliminary determination that an environmental impact statement will not be required.
Enbridge Energy Co. of Superior has applied to the Wisconsin DNR for waterway and wetland crossing permits and air quality permits for the proposed project. The company will also need a stormwater permit and an endangered resources review for the project.
The proposed project consists of constructing a new 36-inch diameter petroleum pipeline known as the Alberta Clipper, a new 20-inch diameter diluent return pipeline known as the Southern Lights, an associated pump station for the Southern Lights pipeline and five 250,000-barrel breakout tanks. The proposed pipelines would be constructed along a 13-mile route in Douglas County from the Wisconsin-Minnesota border to the Enbridge Superior Terminal in Superior.
It requires 17 water body crossings, including 10 tributaries to the Pokegama River, three un-named waterways, two tributaries to the Little Pokegama River, one crossing of the Pokegama River and one crossing of an unnamed tributary to the Nemadji River.
The proposed pipelines would temporarily impact approximately 75 acres of wetland.
The pump station and breakout tanks at the Superior Terminal would fill approximately 12 acres of wetland and temporarily impact approximately three acres of wetland.
The project as proposed is not anticipated to result in significant adverse environmental effects, according to DNR officials. DNR has made a preliminary determination that an environmental impact statement will not be required.
Thursday, May 21, 2009
FERC gives Downeast LNG project favorable review
WASHINGTON - Federal regulators on May 18 gave a favorable environmental review of Downeast LNG's proposed liquefied natural gas terminal in Washington County, Me.
The Federal Energy Regulatory Commission said Downeast LNG's proposed LNG terminal and pipeline would have some adverse environmental impacts, but that they could be "reduced to less-than-significant levels" by the company's proposed mitigation efforts and additional recommendations included in FERC's draft environmental impact statement.
Downeast LNG is proposing a 320,000-cubic-meter LNG terminal, storage tanks, regasification plant and a pier on an 80-acre site on Passamaquoddy Bay in Robbinston, as well as a pipeline that would send the natural gas 30 miles northwest to a point near Baileyville where it would connect with Maritimes and Northeast Pipeline LLC's existing pipeline.
The Federal Energy Regulatory Commission said Downeast LNG's proposed LNG terminal and pipeline would have some adverse environmental impacts, but that they could be "reduced to less-than-significant levels" by the company's proposed mitigation efforts and additional recommendations included in FERC's draft environmental impact statement.
Downeast LNG is proposing a 320,000-cubic-meter LNG terminal, storage tanks, regasification plant and a pier on an 80-acre site on Passamaquoddy Bay in Robbinston, as well as a pipeline that would send the natural gas 30 miles northwest to a point near Baileyville where it would connect with Maritimes and Northeast Pipeline LLC's existing pipeline.
Wednesday, May 20, 2009
Wilbros denies picketers’ claims that it’s paying substandard wages on pipeline construction jobs
JACKSONVILLE, Texas – Wilbros began work in March on a 143-mile Energy Transfer Partners’ natural gas pipeline that passes through northern Cherokee County on its way to Minden, Texas, from Maypearl, Texas.
Officials with Willbros Group, the construction company building the pipeline, have said they will employ as many as 1,200 workers at its peak.
At least two union groups have been picketing Willbros Group’s local headquarters in protest of the company’s hiring practices.
“We’ve been picketed at several locations over the years,” said Harry New, Wilbros project director for the natural gas pipeline.
New said some of the reasons the Texas picket line formed aren’t true –specifically, allegations concerning the company’s employment pools and pay scales.
“All the people we hire are legal to work in the U.S.,” New said. “We’ve also implemented a 401K and offer benefits. It’s up to the employee to elect to take advantage of them.”
Officials with Willbros Group, the construction company building the pipeline, have said they will employ as many as 1,200 workers at its peak.
At least two union groups have been picketing Willbros Group’s local headquarters in protest of the company’s hiring practices.
“We’ve been picketed at several locations over the years,” said Harry New, Wilbros project director for the natural gas pipeline.
New said some of the reasons the Texas picket line formed aren’t true –specifically, allegations concerning the company’s employment pools and pay scales.
“All the people we hire are legal to work in the U.S.,” New said. “We’ve also implemented a 401K and offer benefits. It’s up to the employee to elect to take advantage of them.”
Tuesday, May 19, 2009
Wet spring slows TransCanada Keystone construction in South Dakota
ABERDEEN, S.D. - The resumption of work on the TransCanada oil pipeline in northeast South Dakota has been delayed because of an exceptionally wet spring.
The prime contractor says many fields are too wet and some roads have load limits so it's impossible to get heavy equipment to rural sites.
The pipeline will carry crude oil from Canada through 10 counties in eastern South Dakota and on to refineries in Illinois and Oklahoma.
Some pipeline such as at stream crossings was buried in the northeast part of the state last year before crews quit for winter.
TransCanada spokesman Jeff Rauh says in spite of the delay this spring, the line should be operational by late this year.
The prime contractor says many fields are too wet and some roads have load limits so it's impossible to get heavy equipment to rural sites.
The pipeline will carry crude oil from Canada through 10 counties in eastern South Dakota and on to refineries in Illinois and Oklahoma.
Some pipeline such as at stream crossings was buried in the northeast part of the state last year before crews quit for winter.
TransCanada spokesman Jeff Rauh says in spite of the delay this spring, the line should be operational by late this year.
Monday, May 18, 2009
Three workers killed in TEPPCO tank farm explosion in Arkansas
LITTLE ROCK, Ark. - Three men killed when vapors in a gasoline storage
tank exploded in north Arkansas likely died from the impact of the
blast, a coroner said on May 13.
Federal safety officials began their investigation into the blast at the
TEPPCO Partners LP facility near Searcy in earnest on May 13. They were trying to determine what killed the contract workers from Indiana.
Meanwhile, Arkansas officials acknowledged the tank fell outside of any state oversight and last underwent an internal inspection by federal authorities more than a decade ago.
White County Coroner David Powell told The Associated Press that rescuers recovered the workers' bodies outside of the crumpled storage tank after the explosion on May 12. Powell said the men's bodies bore no signs of being scorched by flames.
"There was no indication of fire. It was an explosion," Powell said. "The injuries were simply caused from the concussion of the explosion."
All three men worked for C and C Welding of Elizabethtown, Ky. Powell identified the dead as William Decker, 48, of Scottsburg, Ind.; Roy Mathis, 60, of Wheatfield, Ind.; and Stoney Powell, 45, also of Wheatfield.
Powell said the workers' bodies had been sent to the state Crime Laboratory in Little Rock for autopsies.
tank exploded in north Arkansas likely died from the impact of the
blast, a coroner said on May 13.
Federal safety officials began their investigation into the blast at the
TEPPCO Partners LP facility near Searcy in earnest on May 13. They were trying to determine what killed the contract workers from Indiana.
Meanwhile, Arkansas officials acknowledged the tank fell outside of any state oversight and last underwent an internal inspection by federal authorities more than a decade ago.
White County Coroner David Powell told The Associated Press that rescuers recovered the workers' bodies outside of the crumpled storage tank after the explosion on May 12. Powell said the men's bodies bore no signs of being scorched by flames.
"There was no indication of fire. It was an explosion," Powell said. "The injuries were simply caused from the concussion of the explosion."
All three men worked for C and C Welding of Elizabethtown, Ky. Powell identified the dead as William Decker, 48, of Scottsburg, Ind.; Roy Mathis, 60, of Wheatfield, Ind.; and Stoney Powell, 45, also of Wheatfield.
Powell said the workers' bodies had been sent to the state Crime Laboratory in Little Rock for autopsies.
Friday, May 15, 2009
Nabucco deal to be signed in Ankara on June 25
ANKARA - The European Union and Turkey have struck a ground-breaking gas pipeline deal, according to senior EU officials.
The agreement, to be signed in Ankara on June25, represents a major boost to the EU's proposed Nabucco pipeline project, which is to transport natural gas to Europe from central Asia, the Caucasus and the Middle East.
"This is a complete breakthrough," said a senior EU official involved in the tough negotiations with Turkey. "The Turks have accepted our terms. There is no conditionality."
The €9 billion Nabucco project is at the center of a contest pitting Russia against the EU and involving Turkey, Germany, Austria, Azerbaijan and the authoritarian regimes of central Asia in the effort to secure Europe's gas needs while curbing the hold Moscow and the gas monopoly Gazprom have over the supply lines. Nabucco, to stretch more than 2,000 miles from Turkey's eastern border to Europe's main gas hub outside Vienna, would be the main route for pumping gas to Europe not controlled by Gazprom.
The plan to build Nabucco faltered over a deadlock between the EU and Turkey over the pipeline transit agreement. More than half the pipeline is to be located in Turkey, making it the gatekeeper of Europe's energy supplies.
Ankara has been driving a hard bargain, insisting on collecting a "tax" on the gas being pumped and demanding 15 percent of the transit gas at discounted prices. This, say EU officials and the six-company consortium that is to build and run the pipeline, would render Nabucco financially unviable.
The stalemate was broken at a summit in Prague on May 8 between the EU and the countries involved. "The 15 percent demand has gone," Andris Piebalgs, the EU commissioner for energy, told the Guardian. "We've agreed on cost-based transit. We're very close to a conclusion."
The agreement, to be signed in Ankara on June25, represents a major boost to the EU's proposed Nabucco pipeline project, which is to transport natural gas to Europe from central Asia, the Caucasus and the Middle East.
"This is a complete breakthrough," said a senior EU official involved in the tough negotiations with Turkey. "The Turks have accepted our terms. There is no conditionality."
The €9 billion Nabucco project is at the center of a contest pitting Russia against the EU and involving Turkey, Germany, Austria, Azerbaijan and the authoritarian regimes of central Asia in the effort to secure Europe's gas needs while curbing the hold Moscow and the gas monopoly Gazprom have over the supply lines. Nabucco, to stretch more than 2,000 miles from Turkey's eastern border to Europe's main gas hub outside Vienna, would be the main route for pumping gas to Europe not controlled by Gazprom.
The plan to build Nabucco faltered over a deadlock between the EU and Turkey over the pipeline transit agreement. More than half the pipeline is to be located in Turkey, making it the gatekeeper of Europe's energy supplies.
Ankara has been driving a hard bargain, insisting on collecting a "tax" on the gas being pumped and demanding 15 percent of the transit gas at discounted prices. This, say EU officials and the six-company consortium that is to build and run the pipeline, would render Nabucco financially unviable.
The stalemate was broken at a summit in Prague on May 8 between the EU and the countries involved. "The 15 percent demand has gone," Andris Piebalgs, the EU commissioner for energy, told the Guardian. "We've agreed on cost-based transit. We're very close to a conclusion."
Wednesday, May 13, 2009
Drop in natural gas price slows Marcellus shale development
The recession-induced decline in the price of natural gas has slowed development of Marcellus shale deposits in Pennsylvania, but development is expected to accelerate once prices pick up in 2010.
Virtually all of the Marcellus wells are still in the exploratory stage, with only one in southwestern Pennsylvania sending gas into a production pipeline.
The 365 million-year-old layer of rock that contains the gas underlies 54 of Pennsylvania's 67 counties. The rock is believed to hold 363 trillion cubic feet of natural gas worth $1 trillion. By some calculations, 10 percent of that could supply all the gas needs of the United States for two years.
More efficient and economical methods of drilling have allowed exploration at depths of 5,000 to 8,000 feet that were previously out of reach.
Close to 30 drilling companies have set up operations in the commonwealth, snapping up drilling rights on tens of thousands of acres of land
The state is on track to issue a record number of Marcellus permits this year. From Jan. 1 through April 17, the Department of Environmental Protection has issued 2,028 drilling permits, 394 of which are specifically for exploration of the Marcellus shale.
Virtually all of the Marcellus wells are still in the exploratory stage, with only one in southwestern Pennsylvania sending gas into a production pipeline.
The 365 million-year-old layer of rock that contains the gas underlies 54 of Pennsylvania's 67 counties. The rock is believed to hold 363 trillion cubic feet of natural gas worth $1 trillion. By some calculations, 10 percent of that could supply all the gas needs of the United States for two years.
More efficient and economical methods of drilling have allowed exploration at depths of 5,000 to 8,000 feet that were previously out of reach.
Close to 30 drilling companies have set up operations in the commonwealth, snapping up drilling rights on tens of thousands of acres of land
The state is on track to issue a record number of Marcellus permits this year. From Jan. 1 through April 17, the Department of Environmental Protection has issued 2,028 drilling permits, 394 of which are specifically for exploration of the Marcellus shale.
TransCanada awarded contract to build Guadalajara pipeline in Mexico
CALGARY, Alta. - TransCanada Corp. has been awarded a contract to build, own and operate a US$320 million pipeline in Mexico. The project is supported by a 25-year contract for its entire capacity with Comision Federal de Electricidad (CFE), Mexico’s state-owned electric company.
The proposed Guadalajara Pipeline will follow a 193-mile route from a liquefied natural gas terminal under construction near Manzanillo on Mexico’s Pacific Coast to Guadalajara, the second largest city in Mexico. The 30-inch pipeline will be capable of transporting 500 million cubic feet a day (MMcf/d) of natural gas. The majority of the capital expenditures are expected to be made in 2010 with a targeted in-service date of March 2011.
“The Guadalajara Pipeline project builds on TransCanada’s excellent working relationship with CFE,” said Hal Kvisle, TransCanada president and chief executive officer. “With Mexico’s growing reliance on natural gas and TransCanada’s proven success in building, owning and operating Mexican pipelines, the Guadalajara Pipeline offers an excellent opportunity for TransCanada to expand its footprint in Mexico.”
The proposed Guadalajara Pipeline will follow a 193-mile route from a liquefied natural gas terminal under construction near Manzanillo on Mexico’s Pacific Coast to Guadalajara, the second largest city in Mexico. The 30-inch pipeline will be capable of transporting 500 million cubic feet a day (MMcf/d) of natural gas. The majority of the capital expenditures are expected to be made in 2010 with a targeted in-service date of March 2011.
“The Guadalajara Pipeline project builds on TransCanada’s excellent working relationship with CFE,” said Hal Kvisle, TransCanada president and chief executive officer. “With Mexico’s growing reliance on natural gas and TransCanada’s proven success in building, owning and operating Mexican pipelines, the Guadalajara Pipeline offers an excellent opportunity for TransCanada to expand its footprint in Mexico.”
Tuesday, May 12, 2009
Third-party damage blamed for gas pipeline rupture in Wisconsin
ARKANSAW, Wis. - A May 6 rupture in a Northern Natural Gas pipeline here has been blamed on third-party damage.
First responders evacuated homes within a one-half mile radius, affecting approximately 25 residences. Responders also blocked roads near the accident. There was no fire or explosion and there are no known injuries.
Northern dispatched trained crews to the scene who implemented a plan to safely make repairs on the line. Until repairs were completed, Northern asked local gas distribution companies to conserve as much gas as possible
Repair crews finished their work on May 7. Mike Loeffler of Northern Natural Gas said everyone who was evacuated in the area was back at home by 4:30 a.m. May 7.
The Pepin County Sheriff said a farm employee was dragging a scraper behind a tractor when he hit the pipeline.
First responders evacuated homes within a one-half mile radius, affecting approximately 25 residences. Responders also blocked roads near the accident. There was no fire or explosion and there are no known injuries.
Northern dispatched trained crews to the scene who implemented a plan to safely make repairs on the line. Until repairs were completed, Northern asked local gas distribution companies to conserve as much gas as possible
Repair crews finished their work on May 7. Mike Loeffler of Northern Natural Gas said everyone who was evacuated in the area was back at home by 4:30 a.m. May 7.
The Pepin County Sheriff said a farm employee was dragging a scraper behind a tractor when he hit the pipeline.
Monday, May 11, 2009
NuStar reports decline in first quarter 2009, income, announces distribution
SAN ANTONIO. Texas - NuStar Energy L.P. (NYSE: NS) on April 30 announced net income applicable to limited partners of $31.6 million, or $0.58 per unit, for the first quarter of 2009, compared to $49.6 million, or $1.01 per unit, earned in the first quarter of 2008.
"However, a year-over-year quarterly comparison is largely meaningless as NuStar's business changed dramatically with its acquisition of the former CITGO asphalt refining and marketing operations near the end of the first quarter of 2008," said Curt Anastasio, CEO and president of NuStar Energy L.P. and NuStar GP Holdings, LLC. "Because of the inherent seasonality of the asphalt business, our first quarter 2009 results are burdened with all of the additional cost and expense of that operation while the vast majority of the financial benefit will be generated during the second and third quarters. The important takeaway for our unitholders is that the financial results of our transportation and storage segments during the first quarter of 2009 were actually better than last year. And, for the full year 2009, the asphalt operations are expected to provide an even bigger boost to earnings and cash flow than they did in 2008.
Included in NuStar Energy L.P.'s earnings results for the first quarter of 2009 is a $4.7 million, or $0.08 per unit, gain, net of tax, related to property insurance proceeds received due to damage incurred from Hurricane Ike that occurred at the Texas City, Texas, terminal in the third quarter of 2008. Excluding the effect of the Hurricane and other items, first quarter 2009 adjusted earnings would have been $25.8 million, or $0.47 per unit.
NuStar Energy L.P. also announced that its board has declared a distribution of $1.0575 per unit, which would equate to $4.23 per unit on an annual basis. The quarterly distribution represents an increase of $0.0725 per unit, or 7.4 percent, over the $0.985 distribution for the first quarter of 2008, but is unchanged from the fourth quarter of 2008. The first quarter 2009 distribution will be paid on May 15 to holders of record on May 8.
Distributable cash flow available to limited partners for the first quarter of 2009 was $69.4 million, or $1.28 per unit, compared to $72.0 million, or $1.46 per unit, for the first quarter of 2008. This was the third best quarterly distributable cash flow performance since NuStar Energy L.P. went public in 2001.
"However, a year-over-year quarterly comparison is largely meaningless as NuStar's business changed dramatically with its acquisition of the former CITGO asphalt refining and marketing operations near the end of the first quarter of 2008," said Curt Anastasio, CEO and president of NuStar Energy L.P. and NuStar GP Holdings, LLC. "Because of the inherent seasonality of the asphalt business, our first quarter 2009 results are burdened with all of the additional cost and expense of that operation while the vast majority of the financial benefit will be generated during the second and third quarters. The important takeaway for our unitholders is that the financial results of our transportation and storage segments during the first quarter of 2009 were actually better than last year. And, for the full year 2009, the asphalt operations are expected to provide an even bigger boost to earnings and cash flow than they did in 2008.
Included in NuStar Energy L.P.'s earnings results for the first quarter of 2009 is a $4.7 million, or $0.08 per unit, gain, net of tax, related to property insurance proceeds received due to damage incurred from Hurricane Ike that occurred at the Texas City, Texas, terminal in the third quarter of 2008. Excluding the effect of the Hurricane and other items, first quarter 2009 adjusted earnings would have been $25.8 million, or $0.47 per unit.
NuStar Energy L.P. also announced that its board has declared a distribution of $1.0575 per unit, which would equate to $4.23 per unit on an annual basis. The quarterly distribution represents an increase of $0.0725 per unit, or 7.4 percent, over the $0.985 distribution for the first quarter of 2008, but is unchanged from the fourth quarter of 2008. The first quarter 2009 distribution will be paid on May 15 to holders of record on May 8.
Distributable cash flow available to limited partners for the first quarter of 2009 was $69.4 million, or $1.28 per unit, compared to $72.0 million, or $1.46 per unit, for the first quarter of 2008. This was the third best quarterly distributable cash flow performance since NuStar Energy L.P. went public in 2001.
Friday, May 8, 2009
Enbridge will appeal $2.4 million fine levied for fatal Minnesota accident
DULUTH, Minn. – This July, Enbridge Pipelines, LLC will makes its case for a reduction in the fine levied by the U.S. Pipeline and Hazardous Materials Safety Administration for a fatal accident in Minnesota.
PHMSA has proposed a $2.4 million dollar fine from the November 2007 fire and explosion in Clearbrook, Minn., that killed two contract pipeline repair workers from Superior, Wis.
Spokeswoman Denise Hamsher says Enbridge is not contesting the investigation, only the $2.4 million fine.
She says Enbridge’s own internal investigation agrees with the government findings, but that the fine should be consolidated. There should be fewer specific violations, thus a smaller fine. She said she doesn't know what figure would be appropriate.
The hearing is set for July 13th in Kansas City.
PHMSA has proposed a $2.4 million dollar fine from the November 2007 fire and explosion in Clearbrook, Minn., that killed two contract pipeline repair workers from Superior, Wis.
Spokeswoman Denise Hamsher says Enbridge is not contesting the investigation, only the $2.4 million fine.
She says Enbridge’s own internal investigation agrees with the government findings, but that the fine should be consolidated. There should be fewer specific violations, thus a smaller fine. She said she doesn't know what figure would be appropriate.
The hearing is set for July 13th in Kansas City.
Thursday, May 7, 2009
PAA Natural Gas Storage Pine Prairie facility listed as ICE market hub
PAA Natural Gas Storage Pine Prairie facility listed as ICE market hub
HOUSTON, Texas - PAA Natural Gas Storage (PNGS), LLC on April 28 announced that IntercontinentalExchange (NYSE: ICE), a leading operator of regulated global futures exchanges and over-the-counter markets, has listed the PNGS Pine Prairie facility in Evangeline Parish, La., as a natural gas market hub on the ICE OTC trading platform. PNGS is indirectly owned 50 percent by Plains All American Pipeline, L.P. (NYSE: PAA) and 50 percent by Vulcan Capital.
"The listing of Pine Prairie Hub as a trading point by ICE is a meaningful step in the evolution of our Pine Prairie franchise," said Dean Liollio, president of PNGS. "ICE is a well-respected market platform that offers customers price discovery and the ability to buy and sell natural gas at a variety of physical market hubs throughout North America. The addition of Pine Prairie to the ICE system facilitates our customers' ability to efficiently utilize their leased storage and wheeling capacity at Pine Prairie to balance their system-wide natural gas needs and improves the liquidity of the Pine Prairie facility. Enhanced liquidity around a market hub is attractive for customers and we believe will ultimately improve the value of our asset."
HOUSTON, Texas - PAA Natural Gas Storage (PNGS), LLC on April 28 announced that IntercontinentalExchange (NYSE: ICE), a leading operator of regulated global futures exchanges and over-the-counter markets, has listed the PNGS Pine Prairie facility in Evangeline Parish, La., as a natural gas market hub on the ICE OTC trading platform. PNGS is indirectly owned 50 percent by Plains All American Pipeline, L.P. (NYSE: PAA) and 50 percent by Vulcan Capital.
"The listing of Pine Prairie Hub as a trading point by ICE is a meaningful step in the evolution of our Pine Prairie franchise," said Dean Liollio, president of PNGS. "ICE is a well-respected market platform that offers customers price discovery and the ability to buy and sell natural gas at a variety of physical market hubs throughout North America. The addition of Pine Prairie to the ICE system facilitates our customers' ability to efficiently utilize their leased storage and wheeling capacity at Pine Prairie to balance their system-wide natural gas needs and improves the liquidity of the Pine Prairie facility. Enhanced liquidity around a market hub is attractive for customers and we believe will ultimately improve the value of our asset."
Wednesday, May 6, 2009
Eagle Rock LP stock plunges after dividend cut announcement
HOUSTON – Houston-based natural gas company Eagle Rock Energy Partners, L.P. (NASDAQ: EROC) late on April 29 announced that it was cutting its common unit distribution from $0.41per quarter to $0.025 per quarter.
Although the company said the move was temporary, EROC stock in heavy trading on April 30 declined to $3.79 per common unit, a drop of $2.64 or 41.06 percent per common unit. On May 2, in continued heavy trading, the unit price was down another $0.13 per unit, or 3.43 percent.
EROC said in its initial news release that the move was made to enhance its liquidity position
In September 2008, Kayne Anderson Energy Development Co., a Houston closed-end investment firm, announced the sale of Millennium Midstream Partners LP to Eagle Rock Energy for $236 million. Eagle Rock agreed to pay $181 million cash plus four million units of its stock for Millennium.
The new Eagle Rock distribution of $0.025 per unit will be paid on May 15 to common unitholders of record on May 11. Subordinated units will not receive a distribution.
In the news release announcing the change, EROC said its board made the decision to reduce the distribution due to the continued decline in natural gas prices and drilling activity and the concern that these conditions may persist for the next 12 to 24 months. Also impacting the decision was a recent reduction in the company’s borrowing base which impacted the Partnership's overall liquidity. Management expects the Partnership to continue with a reduced distribution rate until commodity prices rise to a level that supports resumed drilling activity in its core areas and, in the opinion of the board, the Partnership's liquidity is sufficiently improved.
EROC expects on May 7 to report adjusted EBITDA of approximately $40 million for the first quarter of 2009 (subject to the completion of the Partnership's quarter-end review). Based on normal operating conditions, current expectations of customer drilling activity and assuming no curtailments or shut-in production by the Partnership's producer customer base, management believes the Partnership will generate between $40 million and $45 million of quarterly Adjusted EBITDA for the remainder of 2009. This would enable the Partnership to redirect $75 million to $100 million of cash flow to enhance liquidity and to remain within the financial covenants in its credit facility.
Although the company said the move was temporary, EROC stock in heavy trading on April 30 declined to $3.79 per common unit, a drop of $2.64 or 41.06 percent per common unit. On May 2, in continued heavy trading, the unit price was down another $0.13 per unit, or 3.43 percent.
EROC said in its initial news release that the move was made to enhance its liquidity position
In September 2008, Kayne Anderson Energy Development Co., a Houston closed-end investment firm, announced the sale of Millennium Midstream Partners LP to Eagle Rock Energy for $236 million. Eagle Rock agreed to pay $181 million cash plus four million units of its stock for Millennium.
The new Eagle Rock distribution of $0.025 per unit will be paid on May 15 to common unitholders of record on May 11. Subordinated units will not receive a distribution.
In the news release announcing the change, EROC said its board made the decision to reduce the distribution due to the continued decline in natural gas prices and drilling activity and the concern that these conditions may persist for the next 12 to 24 months. Also impacting the decision was a recent reduction in the company’s borrowing base which impacted the Partnership's overall liquidity. Management expects the Partnership to continue with a reduced distribution rate until commodity prices rise to a level that supports resumed drilling activity in its core areas and, in the opinion of the board, the Partnership's liquidity is sufficiently improved.
EROC expects on May 7 to report adjusted EBITDA of approximately $40 million for the first quarter of 2009 (subject to the completion of the Partnership's quarter-end review). Based on normal operating conditions, current expectations of customer drilling activity and assuming no curtailments or shut-in production by the Partnership's producer customer base, management believes the Partnership will generate between $40 million and $45 million of quarterly Adjusted EBITDA for the remainder of 2009. This would enable the Partnership to redirect $75 million to $100 million of cash flow to enhance liquidity and to remain within the financial covenants in its credit facility.
Tuesday, May 5, 2009
Eagle Rock LP stock plunges after dividend cut announcement
HOUSTON – Houston-based natural gas company Eagle Rock Energy Partners, L.P.
(NASDAQ: EROC) late on April 29 announced that it was cutting its common unit distribution from $0.41per quarter to $0.025 per quarter.
Although the company said the move was temporary, EROC stock in heavy trading on April 30 declined to $3.79 per common unit, a drop of $2.64 or 41.06 percent per common unit. On May 2, in continued heavy trading, the unit price was down another $0.13 per unit, or 3.43 percent.
EROC said in its initial news release that the move was made to enhance its liquidity position
In September 2008, Kayne Anderson Energy Development Co., a Houston closed-end investment firm, announced the sale of Millennium Midstream Partners LP to Eagle Rock Energy for $236 million. Eagle Rock agreed to pay $181 million cash plus four million units of its stock for Millennium.
The new Eagle Rock distribution of $0.025 per unit will be paid on May 15 to common unitholders of record on May 11. Subordinated units will not receive a distribution.
In the news release announcing the change, EROC said its board made the decision to reduce the distribution due to the continued decline in natural gas prices and drilling activity and the concern that these conditions may persist for the next 12 to 24 months. Also impacting the decision was a recent reduction in the company’s borrowing base which impacted the Partnership's overall liquidity. Management expects the Partnership to continue with a reduced distribution rate until commodity prices rise to a level that supports resumed drilling activity in its core areas and, in the opinion of the board, the Partnership's liquidity is sufficiently improved.
Joseph A. Mills, chairman and chief executive officer, said, "The continued decline in natural gas prices through the end of the first quarter has resulted in a dramatic response from E&P companies. The onshore natural gas rig count has fallen by approximately 45 percent since the start of the year. This reduced drilling activity and unfavorable commodity price environment has had an impact on our overall revenue stream. As the timing of a potential rebound in commodity prices remains uncertain, we have refocused our priorities towards ensuring the sustained viability of the Partnership. By lowering our distributions, we intend to significantly reduce our outstanding debt, which will benefit our common unitholders in the form of greater equity value and more financial and operating flexibility. At the same time, we will continue our efforts to control costs and capital expenditures in these challenging times."
(NASDAQ: EROC) late on April 29 announced that it was cutting its common unit distribution from $0.41per quarter to $0.025 per quarter.
Although the company said the move was temporary, EROC stock in heavy trading on April 30 declined to $3.79 per common unit, a drop of $2.64 or 41.06 percent per common unit. On May 2, in continued heavy trading, the unit price was down another $0.13 per unit, or 3.43 percent.
EROC said in its initial news release that the move was made to enhance its liquidity position
In September 2008, Kayne Anderson Energy Development Co., a Houston closed-end investment firm, announced the sale of Millennium Midstream Partners LP to Eagle Rock Energy for $236 million. Eagle Rock agreed to pay $181 million cash plus four million units of its stock for Millennium.
The new Eagle Rock distribution of $0.025 per unit will be paid on May 15 to common unitholders of record on May 11. Subordinated units will not receive a distribution.
In the news release announcing the change, EROC said its board made the decision to reduce the distribution due to the continued decline in natural gas prices and drilling activity and the concern that these conditions may persist for the next 12 to 24 months. Also impacting the decision was a recent reduction in the company’s borrowing base which impacted the Partnership's overall liquidity. Management expects the Partnership to continue with a reduced distribution rate until commodity prices rise to a level that supports resumed drilling activity in its core areas and, in the opinion of the board, the Partnership's liquidity is sufficiently improved.
Joseph A. Mills, chairman and chief executive officer, said, "The continued decline in natural gas prices through the end of the first quarter has resulted in a dramatic response from E&P companies. The onshore natural gas rig count has fallen by approximately 45 percent since the start of the year. This reduced drilling activity and unfavorable commodity price environment has had an impact on our overall revenue stream. As the timing of a potential rebound in commodity prices remains uncertain, we have refocused our priorities towards ensuring the sustained viability of the Partnership. By lowering our distributions, we intend to significantly reduce our outstanding debt, which will benefit our common unitholders in the form of greater equity value and more financial and operating flexibility. At the same time, we will continue our efforts to control costs and capital expenditures in these challenging times."
Monday, May 4, 2009
Embattled in Illinois, Enbridge gets diplomats to lobby for it
SPRINGFIELD, Ill. - Facing strong opposition from environmental groups for its ambitious pipeline project to transport oil-sands crude to U.S. refineries, Enbridge turned to Canadian diplomats to lobby for it in the state capital.
Despite the opposition, construction of the opposed pipeline may start as early as this summer.
The Canadian consul general from Chicago visited Springfield recently along with officials from Enbridge to seek support for the pipeline. The group met with Gov. Pat Quinn and other officials on April 29 to argue that the project will bring revenue and jobs to Illinois.
The first section of the nearly three-year-old, $350 million construction project has been completed to an area about 50 miles northeast of Peoria, Ill. But the final phase has run into opposition from environmental groups and some landowners, who say the pipeline would only encourage continued reliance on polluting petroleum products and would violate property rights.
“Canada has the second-largest reserves in the world. There's 170 billion barrels of reserves, and 97 percent are in the oil sands," said Don Thompson, president of The Oil Sands Developers Group.
Thompson was referring to oil fields in Alberta, Canada, which already supply much of the oil refined in Illinois.
Canadian consul general Georges Rioux estimated $15 billion worth of refinery upgrades and pipeline construction have been completed or begun in order to improve the energy infrastructure connecting Canada and the United States.
Despite the opposition, construction of the opposed pipeline may start as early as this summer.
The Canadian consul general from Chicago visited Springfield recently along with officials from Enbridge to seek support for the pipeline. The group met with Gov. Pat Quinn and other officials on April 29 to argue that the project will bring revenue and jobs to Illinois.
The first section of the nearly three-year-old, $350 million construction project has been completed to an area about 50 miles northeast of Peoria, Ill. But the final phase has run into opposition from environmental groups and some landowners, who say the pipeline would only encourage continued reliance on polluting petroleum products and would violate property rights.
“Canada has the second-largest reserves in the world. There's 170 billion barrels of reserves, and 97 percent are in the oil sands," said Don Thompson, president of The Oil Sands Developers Group.
Thompson was referring to oil fields in Alberta, Canada, which already supply much of the oil refined in Illinois.
Canadian consul general Georges Rioux estimated $15 billion worth of refinery upgrades and pipeline construction have been completed or begun in order to improve the energy infrastructure connecting Canada and the United States.
Friday, May 1, 2009
El Paso lifts force majeure on Southern Natural Gas
HOUSTON - El Paso said on April 24 that it had lifted force majeure on its Southern Natural Gas unit after divers confirmed a leak in the area of its 18-inch West Delta 105 natural gas pipeline in the Gulf of Mexico was not on its system.
Employees were in the process of restoring the pipeline to service, according to a
website posting.
About 42 million cubic feet per day of gas was shut in while divers investigated the leak.
It was not immediately known what pipeline was involved in the reported leak.
Employees were in the process of restoring the pipeline to service, according to a
website posting.
About 42 million cubic feet per day of gas was shut in while divers investigated the leak.
It was not immediately known what pipeline was involved in the reported leak.
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