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.
Monday, May 11, 2009
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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