Brianna Panzica - Angel PublishingLatest Articles by Brianna Panzica of Angel Publishing2013-02-14T21:42:55ZAmerican Airlines and US Airways to MergeWith the American Airlines and US Airways merger, four main airlines will control global travel. And as oil prices rise, this could mean trouble for ticket prices. You heard it here first...<p>Today, US Airways Group Inc. (NYSE: LCC) and AMR Corp. (PINK: AAMRQ), the parent of American Airlines, announced the approval of their merger.</p>
<p>AMR Corp. filed for bankruptcy protection in 2011. The company had been losing money for years, and it decided then that it was time to restructure. US Airways showed interest in a merger, but AMR CEO Tom Horton criticized the airline's advances.</p>
<p>Now, more than a year later, his company has given in. And Horton is handling it well, telling the <em><a href="http://online.wsj.com/article/SB10001424127887323478004578303630011153910.html" target="_blank">Wall Street Journal</a></em>, “I think we'll work well together,” in reference to the relationship between him and US Airways CEO Doug Parker.</p>
<p>The two had been friends for years, working together at American Airlines. When the merger takes place, Parker will become chairman and Horton will stay on temporarily as non-executive chairman, stepping down in 2014.</p>
<p>The new airline will be worth an estimated $11 billion and will be one of the largest in the world. It is expected to be enough to repay AMR's creditors while also allowing current shareholders to obtain the remaining 3.5% stake. Shareholders of US Airways will control 28% of the company.</p>
<p>Though Mr. Parker will become CEO, the company will retain the American Airlines brand – one that is much better known globally. The companies expect to save $1 billion a year by 2015 and bring in an annual $40 billion in revenue.</p>
<p>Now there will be just four major airlines to rule the global skies: United Continental (NYSE: UAL), Delta Air Lines (NYSE: DAL), Southwest (NYSE: LUV), and of course the newly-merged company.</p>
<p>This, of course, will limit options for passengers even more than ever before. And when choices are limited, prices go up. Passengers simply can't avoid paying more.</p>
<p><em><a href="http://money.cnn.com/2013/02/08/news/companies/american-us-airways/index.html?iid=EL" target="_blank">CNNMoney</a></em> found that, since 2004, airline fees have only gone up 2%. But now the price of oil is also rising, and these four companies are about to control 80% of passengers on U.S. airlines. There's less competition than ever before – and fewer choices for one-way trips.</p>
<p>Between American Airlines and US Airways, just thirteen locations had nonstop flights, eight of which were shared and will consolidate into one airline. As there are fewer options for flights, seats will become more competitive, pushing prices up.</p>
<p>And then there's the price of oil. It's been bouncing close to $100 a barrel, and this year as global demand goes up to higher than it's ever been and OPEC production goes down slightly, you can guarantee it will break that barrier soon.</p>
<p>Jet fuel prices rely on oil prices, and airline ticket prices rely on jet fuel prices. As John Heimlich, the chief economist at Airlines for America, told <em><a href="http://money.cnn.com/2013/02/14/news/companies/us-airways-american-airlines-passengers/" target="_blank">CNNMoney</a></em>:</p>
<blockquote>
<p><em>“Air travel is a commodity. The market still disciplines pricing.”</em></p>
</blockquote>
<p>Of course, he was referring specifically to customer demand. But that's only part of it. Oil prices have a large hand as well.</p>
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<p>At <em>Energy and Capital</em>, we caught onto this trend in airline prices years ago. It was 2008 when <a href="http://www.energyandcapital.com/articles/rail-airlines-peak+oil/691">we told you</a> about closing and consolidating airlines due to fuel prices, and how growing crude prices would continue to damage this industry.</p>
<p>We even warned you about American Airlines:</p>
<blockquote>
<p><em>The bigger carriers with deeper pockets (and more unsold seats) have kept prices relatively low while burning through cash reserves as their own fuel costs mounted. American Airlines is now losing about $3.3 million a day, and at the current rate, could burn through its $5 billion in cash reserves in as little as four years. And it has the biggest cash reserve in the industry.</em></p>
</blockquote>
<p>And here we are, at a point where American Airlines' losses forced it to make a decision. Fortunately for the company, it will likely be able to repay its creditors – something that doesn't often happen. And as it becomes one of the four major airlines, it's safe for now.</p>
<p>But the price you pay for a flight will not be so lucky. These four will control the pricing, and though smaller carriers may come in to try to cover where these airlines are lagging, they too will struggle to keep up with oil prices.</p>
<p>So book your upcoming flights while you can...before deals on flights are part of the past.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-02-14T21:42:55Z2013-02-14T21:42:55Z3088Brianna PanzicaThe World Needs More OilOPEC forecasts global oil demand will average 89.7 million barrels per day this year. But the world still can't produce that much oil...<p>Global oil demand had been growing steadily since 1984 when the recession hit in 2008. But the economic toll also took a toll on growing demand, and levels remained relatively stagnant at 85 million barrels per day between 2006 and 2008, actually falling below that level in 2009.</p>
<p>In 2010, the world began pulling out of the recession, when demand grew to over 87 million barrels per day. And though it's been a very gradual improvement, the global economy is recovering.</p>
<p>This is apparent in the extent to which oil demand has grown since then. In 2011, demand was 88.2 million barrels per day. In 2012, it was 88.9.</p>
<p>And OPEC recently announced the figure for this year is estimated at 89.7 million barrels per day, an average 800,000 barrels per day more.</p>
<p>But the world has never produced that much. The most <strong>total oil</strong> the world has ever produced was 89.0 million barrels per day, achieved in October 2012.</p>
<p>The most <strong>crude oil</strong> the world has ever produced was 79.99 million barrels per day in April 2012.</p>
<p>It's true, the world has been consuming more oil than it produces for years. According to the International Energy Agency, crude oil production peaked in 2006.</p>
<p>The shale boom has helped North America and the rest of the world continue to increase <strong>total liquids</strong>, but that includes more than just crude oil.</p>
<p>It's called unconventional oil. It's stuck in the shale rock formations, in deposits we previously thought too difficult or even impossible to tap.</p>
<p>New improvements on drilling technology have now allowed us to tap them. But the problem with these unconventional deposits is that they're much harder to access than the conventional crude oil deposits. They require more resources, different technologies, and <em>much</em> more money.</p>
<p>For all intents and purposes, crude oil has peaked. And the shale oil, natural gas liquids, and other liquids that will replace it are going to be different and from different locations around the globe.</p>
<p>OPEC has announced it would increase its planned output in 2013, estimating production of 29.8 million barrels per day on average.</p>
<p>But the group's production in January was higher than this at 30.3 million bpd.</p>
<p>From <em><a href="http://www.bloomberg.com/news/2013-02-12/opec-boosts-estimated-demand-for-its-own-crude-oil.html" target="_blank">Bloomberg</a></em>:</p>
<blockquote>
<p><em>“Given some signs of recovery in the global economy and colder weather at the start of this year, the forecast for world oil demand growth in 2013 has also been revised up,” OPEC's Vienna-based secretariat said. “The bulk of the growth is seen coming from China.”</em></p>
</blockquote>
<p>Oil demand in developing nations is growing rapidly. China and India have a seen an uptrend in power demand, as have major oil producers like Saudi Arabia.</p>
<p>This is beginning to pose a problem. Though Saudi demand peaked over the summer, it's likely to go back up again throughout the year. The nation is interested in curbing domestic demand, working on <a href="http://www.energyandcapital.com/articles/opec-panics/3075">renewable energy projects</a> in an effort to do so.</p>
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<p>Saudi Arabia output dropped in December to 9 million bpd from what had been around 9.9 million bpd for the first half of the year, rising as high as 10.1 million bpd during April and June. It was suggested that the nation decreased its output in order to manipulate crude prices, though Saudi Arabia has denied those allegations.</p>
<p>The truth is, crude oil output isn't going to last. The world has unconventional petroleum to rely on, though obtaining those fuels can prove very expensive. But crude oil has peaked, and now even more developing nations are growing to the point where higher oil demand is only natural.</p>
<p>And as that happens, the gap between oil production and demand will only continue to grow.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>
<p> </p>2013-02-12T20:44:41Z2013-02-12T20:44:41Z3077Brianna PanzicaAustralia's BakkenThe world is awaiting the next shale boom. But while focus remains on European and Asian nations, another country may be preparing for a boom...<p>The United States proved the success of shale oil and gas drilling in the last few years as its production efforts grew into a boom.</p>
<p>News stories swirled around shale formations like the Marcellus, the Eagle Ford, and the Utica. At the center of it all was the Bakken.</p>
<p>Now the focus is on which nation will be the next U.S. Could it be the U.K., which just lifted a ban on fracking? Or China, which is said to have massive shale reserves? And which play will be the next Bakken?</p>
<p>One nation has been calling out that it's found it. But amid all this concentration on Europe and Asia, the rest of the world has yet to listen.</p>
<p><strong>The Shale Down Under</strong></p>
<p>Energy production isn't what comes to mind when thinking of Australia. Kangaroos, maybe, and valuable wildlife, but not energy.</p>
<p>In fact, the country ranks firmly hidden in the middle for most things. According to the <a href="https://www.cia.gov/library/publications/the-world-factbook/geos/as.html" target="_blank">CIA World Factbook</a>, it was ranked 29th for its 2009 crude oil exports, 13th for 2011 natural gas exports, and 53rd for 2009 refined petroleum exports.</p>
<p>It's not even a very big consumer. It's the 31st biggest natural gas consumer and the 16th biggest electricity consumer.</p>
<p>But that is to be expected, as the total population is only 22 million. It lands somewhere in the middle with that, too.</p>
<p>So what is surprising, then, is the fact that the nation is claiming to have massive shale reserves. And because of this, few have paid much attention.</p>
<p>But it's time we started. Australia's Arckaringa Basin could be the next Bakken.</p>
<p><strong>The Arckaringa Basin</strong></p>
<p>The basin is located near the town of Coober Pedy in southern Australia, 500 miles north of Adelaide. Linc Energy (ASX: LNC), the major stakeholder, holds roughly 25,096 square miles.</p>
<p>It's at an early stage right now, but the Australian media has placed its value at $20 trillion. Linc estimates show what it calls “unrisked prospective resources” between 103 and 233 billion barrels of oil equivalent. At least 3.5 billion barrels may be recoverable.</p>
<p>Compare this to the <a href="http://www.energyandcapital.com/resources/bakken-oil-field">Bakken</a>, with an estimated 5.4 billion barrels. The Arckaringa is not that far off, and estimates might increase—as they did with the Bakken—when production begins.</p>
<p>Linc Energy's CEO Peter Bond seems highly optimistic about the prospects. He told <em><a href="http://www.cbc.ca/news/business/story/2013/01/24/business-australia-shale-oil.html" target="_blank">CBC News</a></em>:</p>
<blockquote>
<p><em>“If you stress test it right down and you only took the very sweetest spots in the absolute known areas and you do nothing else, it's about 3.5 billion [barrels] and that's sort of worse-case scenario. So if you took the 233 billion, well, you're talking Saudi Arabia numbers. It's massive, it's just huge.”</em></p>
</blockquote>
<p>Australia had relatively good levels of oil production in 2000. Production peaked that year at 721,566 barrels per day. Consumption, meanwhile, was just above that at 872,429 barrels per day.</p>
<p>But in 2011 consumption had risen to over 1 million bpd, while production dropped to 517,360 bpd. According to Bond, the nation was “falling off the peak oil curve.”</p>
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<p>This shale deposit holds the potential to bring the nation back to its relative self-sufficiency. In fact, if the deposit proves significant enough, Australia could become a net energy exporter.</p>
<p>Cost will certainly be a factor, however. According to <em><a href="http://www.reuters.com/article/2013/01/24/lincenergy-shale-shares-idUSL4N0AT1BC20130124" target="_blank">Reuters</a></em>, shale well drilling costs are 50% higher than they are in the U.S.—where they already run high. The average U.S. shale well costs $10 million, while the average Australian well is closer to $15 million.</p>
<p>Bond puts the project cost for the Arckaringa somewhere around $300 million. Production is still some way off, expected to begin around the end of 2014, but hopes are high. Bond estimates “big commercial operation” in as little as four or five years.</p>
<p>And just as the Bakken brought prosperity to the town of Williston, where unemployment now hardly touches 1%, the Arckaringa is promising for Coober Pedy locals.</p>
<p>Steve Baines, Mayor of Coober Pedy, told the <em><a href="http://www.theaustralian.com.au/news/breaking-news/sa-untapped-oil-may-be-worth-20-trillion/story-fn3dxiwe-1226560693251" target="_blank">Australian</a></em>:</p>
<blockquote>
<p><em>“They've got to source their labour from somewhere, and a project such as what Linc are proposing would need a huge workforce.”</em></p>
<p><em>“I've no doubt that they will be sourcing labour primarily from Coober Pedy where they can.”</em></p>
</blockquote>
<p>Perhaps Australia is the next shale oil boom nation. With major production not five years off, Australia could very well be where the U.S. was in 2006—on the verge of an energy boom, and at an opportunistic early stage for smart investors.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>
<p> </p>2013-02-07T19:58:10Z2013-02-07T19:58:10Z3066Brianna PanzicaDuke Energy (NYSE: DUK) Closes Nuclear PlantDuke Energy (NYSE: DUK) has decided it's in everyone's best interest to close the Crystal River Nuclear Plant, and a natural gas plant might provide a nice replacement...<p>The shale gas boom has a hold over the energy industry.</p>
<p>The low-priced fuel is beginning to take over every aspect of North American energy: it's catching up to coal in power plant fueling, it's working in conjunction with alternative power to increase efficiency, and it's even starting to gain steam as a vehicle fuel.</p>
<p>Few might imagine natural gas could infiltrate the nuclear power industry; yet it's starting to push even nuclear aside.</p>
<p>Yesterday, Duke Energy (NYSE: DUK), the largest utility owner in the country, announced it would be shutting down its Crystal River Nuclear Plant in Florida after years of attempted and failed repairs.</p>
<p>The plant was originally owned by Progress Energy, Inc., which merged with Duke in July 2012. It was 36 years old, but it had been offline since 2009 after cracks were found.</p>
<p>Two years and millions later, the cracks had been repaired, but it was not enough; new cracks were discovered in 2011. Through 2012, the company had spend $338 million on repairs, but the new damage would cost between $1.49 billion and $3.43 billion more.</p>
<p>During the time the reactor had been offline, customers were forced to pay higher costs for alternative power – costs they hadn't expected. Through an insurance settlement, Duke will repay over $835 million to its customers. But this might not be enough to create good terms.</p>
<p>Because while it will reimburse its customers, Duke is also hoping to take back $1.65 billion from its customers to recover its investment in the plant.</p>
<p>A number of analysts believe the decision to close the plant is a good one, including Nathan Judge, an analyst at Atlantic Equities LLP. He told <em><a href="http://www.bloomberg.com/news/2013-02-05/duke-energy-to-shut-crystal-river-reactor-in-florida.html" target="_blank">Bloomberg</a></em> it was a “prudent decision,” though he also expressed concerns:</p>
<blockquote>
<p><em>“Having said that, it leaves ratepayers with about a $1.6 billion bill and that's going to increase scrutiny on Duke's operations in Florida and its rates.”</em></p>
</blockquote>
<p>The company's decision doesn't yet have the all-clear. Florida's Public Service Commission must first determine that the plant's closure is the best decision for the company and its customers. The company will also not be able to recoup its $1.65 billion investment without approval from Florida regulators.</p>
<p>Still, Duke does not believe it is worth keeping the plant alive. The cost of repairs won't be able to be balanced by the low price of nuclear. And there may be a lower-cost fuel readily available, anyway.</p>
<p>From <em><a href="http://www.businessweek.com/news/2013-02-05/duke-reactor-shutdown-plan-shows-shale-s-sway-over-power-energy" target="_blank">Businessweek</a></em>:</p>
<blockquote>
<p><em>“The fuel du jour is natural gas,” Florida Public Counsel J.R. Kelly, the state's official advocate for utility customers, said yesterday in a telephone interview. “I personally believe in fuel diversity. I'm just afraid the costs of new nuclear are going to be prohibitive.”</em></p>
</blockquote>
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<p>Duke, it seems, shares these sentiments. Its top consideration for replacement power is, as <em><a href="http://www.usatoday.com/story/money/business/2013/02/05/duke-energy-nuclear-plant/1893109/" target="_blank">USA Today</a></em> reports, a natural gas-fueled power plant.</p>
<p>Natural gas-fired electricity plants are starting to overtake coal-fired plants to become the norm in the United States. Last year, the EIA estimates, electricity generated by natural gas rose to 30.6% from 24.7% a year earlier. Meanwhile, coal-fired generation fell to 37.3% from 42.3%.</p>
<p><img style="vertical-align: middle; margin: 5px auto; display: block; border: 1px solid black;" src="https://images.angelpub.com/2012/47/17259/electricity-generation-by-fuel.jpg" border="0" alt="Electricity Generation by Fuel" /></p>
<p>The EIA expects this major shift to correct a bit this year, as you can see in the chart, but over the long term it is quite possible that <a href="http://www.energyandcapital.com/resources/natural-gas-companies">natural gas</a> could become the main generator of electricity, particularly as climate change concerns continue the move away from coal use.</p>
<p>That's not to say coal use will disappear globally; China and India are major coal consumers, and this will grow in the years to come. That's good news for U.S. coal miners that export to these locations.</p>
<p>But the shale gas boom has brought forth a cleaner burning, abundant energy source that companies are scrambling to use. The risk is much lower than with nuclear plants, where cracks are the warning signs for major problems.</p>
<p>And when it comes to building a whole new plant, companies are likely to skip the expense and safety measures that come with new nuclear plants. Instead, natural gas looks much more attractive.</p>
<p>As for price, it's one of the cheapest sources available. Duke's customers may be a little more forgiving.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>
<p> </p>2013-02-06T20:06:48Z2013-02-06T20:06:48Z3060Brianna PanzicaBP No Longer Top Oil ProducerBP (LON: BP), once the biggest oil producer, has fallen from the top spot as production slowdowns and Deepwater Horizon trials continue...<p>BP (LON: BP) had a tough year in 2012 after negotiating deals and enduring court cases regarding the 2010 blowout of the Deepwater Horizon rig.</p>
<p>But things got even tougher when the company released its fourth-quarter earnings.</p>
<p>The report, released today, showed a decline of $1 billion in profit from last year's $5 billion. The company chalked the slowdown up to declining production levels and growing costs.</p>
<p>Output from all locations except Russia fell 7%, and the company has sold $38 billion in assets in order to pay for the spill, which so far has cost $42.2 billion. $4.5 billion settlement with the Justice Department over the 2010 spill and any additional costs.</p>
<p>But the nightmare from the spill is far from over. The company's recent $4.5 billion settlement with the Justice Department is included in the costs, but BP still has to face a civil trial. The next trial is expected to begin at the end of February.</p>
<p>As a result of the slip in production, BP suffered perhaps an even bigger fall. The company had been the largest <a href="http://www.energyandcapital.com/articles/crude-oil-investments/2991">crude oil producer</a> since 2008, but this most recent report caused it to fall to number two, ceding the leading spot to Royal Dutch Shell Plc (LON: RDSA).</p>
<p>This fall is proof that the Deepwater Horizon disaster still has far-reaching effects on the company. Though BP plans to boost investments this year to $25 billion, it still will be facing additional costs from the nearly three-year-old mistake. The civil trial alone could cost upwards of $20 billion.</p>
<p>After the blowout, nearly all oil and gas activity in the Gulf of Mexico was halted temporarily as new regulations were put in place. This put a huge dent in BP's output, as it had heavy operations in the Gulf.</p>
<p>But this year, the company's Gulf operations continued to drop almost a third as it produced and average 185,000 barrels per day from the region, the <em><a href="http://online.wsj.com/article/SB10001424127887324900204578285980098301180.html" target="_blank">Wall Street Journal</a></em> reports.</p>
<p>The company attributed this in large part to its maintenance operations this year. BP performed heavy maintenance throughout 2012 to improve the safety of its equipment and set out a more reliable 2013.</p>
<p>Yet that might not carry all the way over to production. Brian Gilvary, BP's chief financial officer, talked to the <em><a href="http://www.nytimes.com/2013/02/06/business/global/bp-earnings-fall-on-lower-production-and-higher-costs.html?_r=0" target="_blank">New York Times</a></em>:</p>
<blockquote>
<p><em>“The impacts of the divestments will be increasingly evident as we move through 2013,” Mr. Gilvary said, adding that asset sales last year would reduce output by about 150,000 barrels per day this year.</em></p>
</blockquote>
<p>The areas Gilvary that mentioned would be lacking in particular were the Gulf of Mexico and the North Sea. CEO Robert W. Dudley believes a production level of 2.2 million barrels per day would be a “low point” for the company, but BP is not far away right now with 2.3 million bpd.</p>
<p>Shell and Exxon Mobil (NYSE: XOM) produce 3.4 million bpd and 4.2 million bpd, respectively.</p>
<p>Meanwhile, the company's net profit dropped 72% from a year ago—dropping from $7.61 billion to $2.14 billion.</p>
<p>BP shares managed to close up 1.46% on Tuesday in London despite the poor earnings report. The company might still be facing setbacks in the year to come, but it has the potential and the resources to regain the strength it once had.</p>
<p>As Dudley said in a statement reported by <em><a href="http://www.marketwatch.com/story/bp-profit-falls-72-on-gulf-fines-lower-output-2013-02-05" target="_blank">MarketWatch</a></em>:</p>
<blockquote>
<p><em>“We have moved past many milestones in 2012, repositioning BP through divestments and bringing on new projects. This lays a solid foundation for growth into the long term.”</em></p>
</blockquote>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>
<p> </p>2013-02-05T21:50:37Z2013-02-05T21:50:37Z3056Brianna PanzicaPBF Energy (NYSE: PBF) Expands Bakken Oil Rail CapacityPBF Energy's (NYSE: PBF) refinery expansions will allow it to ship more Bakken crude than before, but that's not the end of these expansions...<p>The domestic oil and gas industry continues to expand its production levels as improvements in drilling technology couple with a growing demand for the fuels.</p>
<p>But the industry has also faced a problem lately: the nation does not have sufficient infrastructure to support growing production.</p>
<p>Pipelines are planned and under construction, connecting to shale formations like North Dakota's Bakken, but approvals and construction take time. And as producers wait for more infrastructure, the oil and gas they need to move is piling up.</p>
<p>This has led to an excess of on-site flaring of natural gas from some companies, something that regulators are looking to curtail. But it's also led to producers looking for other solutions.</p>
<p>PBF Energy (NYSE: PBF) is taking advantage of existing infrastructure to move its crude faster.</p>
<p>The company has just completed construction of a second rail terminal on its Delaware City refinery, allowing it to move more crude to the facility.</p>
<p>Railways have proved a successful alternative to pipelines for oil and gas transportation. While moving the fuels requires specialized rail cars and terminals that can accept the cars, most of the infrastructure is already in place.</p>
<p>For PBF Energy, this has worked as an advantage. Last year the company announced it would spend between $50 and $60 million on expanding its facilities and purchasing new rail cars, <em><a href="http://www.delawareonline.com/article/20130204/BUSINESS06/130204015/PBF-rail-depot-bring-more-oil-refinery?nclick_check=1" target="_blank">Delaware Online</a></em> reports. Part of this was its second terminal at the Delaware City facility, which can accept 70,000 barrels per day of light Bakken crude.</p>
<p>But that's just the start of expansions for this refinery. PBF Energy announced an additional $50 million will be spent on that facility this year.</p>
<p>The company has been wildly successful with these type of crude oil shipments. As it uses just rail cars, unlike other companies that use rail cars and barges, it save $3 per barrel on shipments to its Delaware facility. The refinery currently has a rail capacity of 110,000 barrels per day, but it can refine up to 182,200 barrels per day in its current state.</p>
<p>The company's CEO, Tom Nimbley, has compared these rail shipments to what the Keystone XL could have been.</p>
<p>From <em><a href="http://www.businessweek.com/news/2013-02-04/pbf-energy-completes-delaware-city-rail-terminal-for-bakken-oil" target="_blank">Businessweek</a></em>:</p>
<blockquote>
<p><em>“The Bakken was faster on building rail infrastructure than the Canadians,” he said. “They were thinking (Keystone) XL was going to get done, they were thinking they'd have that to move it, now they're saying 'Oh my what has happened?'”</em></p>
</blockquote>
<p>The company also transports heavier Canadian crude, which costs more than <a href="http://www.energyandcapital.com/resources/bakken-oil-field">Bakken</a> because fewer barrels can be transported per car. It also requires coiled and insulating rail cars, adding to the transportation cost of $17 per barrel.</p>
<p>It plans on purchasing an additional 2,000 of these special cars for heavy Canadian crude, which can each hold about 550 barrels, within the next two years, and 500 general purpose cars by this year.</p>
<p>Today's announcement of the completion of a second rail terminal marks the beginning of what could be a very good year for PBF. Its success at transporting Bakken crude and refining highly-demanded resources could put it far ahead in the game.</p>
<p>As Tom Nimbley said in the <a href="http://www.marketwatch.com/story/pbf-energy-announces-arrival-of-first-unit-train-at-completed-east-coast-rail-facility-and-additional-investment-in-new-rail-infrastructure-2013-02-04" target="_blank">press release</a>:</p>
<blockquote>
<p><em>“The completion of this premier rail facility puts our East Coast refining system at a competitive advantage compared to its Atlantic Basin peers. PBF is now able to deliver significant quantities of cost-advantaged North American crude oils directly to Delaware City at very competitive pricing.”</em></p>
</blockquote>
<p>Bakken crude rose today after the announcement to trade at a $3.10 a barrel discount to WTI crude, the smallest spread in six weeks.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>
<p> </p>2013-02-04T21:19:31Z2013-02-04T21:19:31Z3051Brianna PanzicaNatural Gas Vehicle GrowthNatural gas vehicles have been gaining popularity in Europe, Asia, and Latin America for the past two decades. So why are they still so scarce in North America?<p>If you fueled up your car this week in the United States, you paid somewhere around $3.35 a gallon for gasoline.</p>
<p>Natural gas, meanwhile, sold for $3.14 per million British thermal units. When considered in terms of gallons, we're looking at around $2 a gallon of gasoline equivalent.</p>
<p>The natural gas production boom has been featured in the mainstream media as production continues to increase monthly...</p>
<p>Total marketed natural gas production set a record in 2012. The EIA predicts it will exceed that this year.</p>
<p>Keep in mind the shale boom that's been contributing to growing production was cranking along long before the media caught on.</p>
<p>With attractive low prices and the years the boom has had to gain momentum, you're probably wondering why you can't just trade your gasoline tank for a natural gas one.</p>
<p>Well, to be honest, you can — but it's probably going to cost you...</p>
<p><strong>The Facts</strong></p>
<p>Here's why:</p>
<ol>
<li>Natural gas fueling stations supplying either compressed natural gas (CNG) or liquefied natural gas (LNG) are few and far between.</li>
<li>Natural gas vehicles, particularly passenger vehicles, make up only a minuscule portion of the entire U.S. vehicle market.</li>
<li>The natural gas-powered vehicles that <em>do</em> exist cost more than gasoline-powered vehicles. With better fuel economy and cheaper prices at the pump, you would recover the cost — if you could only find a fueling station...</li>
<li>A number of cars can be converted to run off natural gas for a cost, but again, you might spend more than you save in driving to a fueling station.</li>
</ol>
<p>It's important to note that the problem that's present in the U.S. isn't universal...</p>
<p>In fact, while the number of natural gas vehicles in North America has been low — and stagnant — since 1991, growth in every other region (with the exception of Africa) has been robust:</p>
<p style="text-align: center;"><img style="vertical-align: middle; margin: 5px auto; display: block; border: 0px none;" src="https://images.angelpub.com/2013/05/18135/natural-gas-vehicles-by-region.jpg" border="0" alt="Natural Gas Vehicles by Region" width="550" /><span style="font-size: 10pt;">Source: <a href="http://www.iangv.org/current-ngv-stats/" target="_blank">NGV Global</a></span></p>
<p>Iran leads the world's nations with the most natural gas vehicles on the road. The country has huge <a href="http://www.energyandcapital.com/articles/shale-natural-gas-better-than-oil/3009">natural gas reserves</a>, and recent sanctions have hurt its gasoline imports. But Iran is learning to become more self-reliant, and its natural gas vehicle market is booming.</p>
<p>In the U.S. natural gas vehicles and fueling infrastructure hit a wall when getting off the ground. Because without vehicles, companies won't build infrastructure... and without infrastructure, consumers won't buy vehicles.</p>
<p><div style="border: 3px solid #00456b; border-radius: 7px; padding: 0px; margin-bottom: 15px; background: #fff;">
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<p><strong>What's Available Now?</strong></p>
<p>As far as passenger vehicles go, the Honda Civic Natural Gas was actually the only all-natural gas vehicle available in 2012. This year, Ford (NYSE: F), General Motors (NYSE: GM), and Ram will each debut bi-fuel pickups, which run on both gasoline and natural gas.</p>
<p>There are also conversion kits that can switch cars to run off of natural gas, which will cost drivers $1,000 or more.</p>
<p>But then there's the fueling stations. Though they're still relatively scarce, particularly in certain parts of the country, more are popping up.</p>
<p>Clean Energy Fuels Corp. (NASDAQ: CLNE) may prove one of the leaders in fueling station installations. The company's America's Natural Gas Highway project is currently in progress, but by the end of the year CLNE will have installed 150 LNG fueling stations — mainly at Pilot-Flying J truck stops — on major highways across the country.</p>
<p>Clean Energy also has a number of CNG stations in place across the United States. And in anticipation of the New Year, the company teamed up with Honda, offering a $3,000 fuel card for its stations to anyone who bought a Civic Natural Gas before January 2.</p>
<p>Companies like Clean Energy and Honda are behind the first big push for natural gas vehicles, but others — particularly truck companies and companies with large fleets — will move it forward.</p>
<p>It isn't going to be a rapid process, but it will likely be a steady one. And natural gas production opportunities will thrive once nat gas-powered vehicles gain their fair share of the market.</p>
<p>Good Investing,</p>
<p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica for <em>Energy and Capital</em></p>
<p><strong><a href="http://www.wealthdaily.com/articles/why-you-should-celebrate-apples-sell-off/3935">Why You Should Celebrate Apple's Sell-Off</a>: Apple's Sell-Off is Good News</strong><br />Analyst Briton Ryle takes readers back in time to explain why investors should be celebrating Apple's sell-off.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/peak-car-investment-opportunities/3015"></a></strong><strong><a href="http://www.energyandcapital.com/articles/peak-car-investment-opportunities/3015?r=1">Peak Car Investment Opportunities</a>: We Hit the Peak in 2005!</strong><br />There's been an interesting shift in behaviors regarding daily work commutes that has led to some folks not even needing a car. You've heard of Peak Oil, but what about "Peak Car"?</p>
<p><strong><a href="http://www.wealthdaily.com/articles/obama-destroys-2900-jobs/3939">Obama Destroys 2,900 Jobs</a>: How to Profit from Government Foolishness</strong><br />Emerging markets are rapidly increasing their use of coal, and logic would dictate the U.S. government would smooth the way for exports. But instead it's attempting to shut it down...</p>
<p><strong><a href="http://www.wealthdaily.com/articles/big-ag-subsidies/3941">Big Ag Subsidies</a>: The Free Market is a Lie!</strong> <br />Your tax dollars are funding beef exports to Japan, industrial farms, and concentrated animal feeding operations.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/us-lng-outlook/3032">U.S. LNG Outlook</a>: LNG Investments</strong><br />Editor Keith Kohl breaks down three U.S. LNG investments and shows readers how to find the safe plays in LNG.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/the-yens-loss-is-golds-gain/3943">The Yen's Loss is Gold's Gain</a>: Currency Wars Flare Up</strong><br />The yen, U.S. dollar, and euro have returned to their three-way race to the bottom. But Japan's desperate move may signal an upward run out of gold's malaise.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/air-car-investment-opportunities/3021">Air Car Investment Opportunities</a>: Will the French Kill the Electric Car?</strong><br />The technology has been around for over 117 years, but a lot has changed. A new compressed air vehicle could be a major game-changer for this automaker. </p>
<p><strong><a href="http://www.wealthdaily.com/articles/buy-silver/3946">Buy Silver</a>: GDP Down, Fed Spending to Continue</strong><br />Consumer demand for silver is setting records. Christian DeHaemer shares with readers four easy ways to play silver.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/frack-it-all/3036">Frack It All!</a>: Free Natural Gas</strong><br />An EIA report published many years ago stated the world would have to spend $20 trillion to meet future energy needs. It seems as though that figure will be grossly underestimated...</p>2013-02-02T16:00:00Z2013-02-02T16:00:00Z3040Brianna PanzicaChesapeake Energy (NYSE: CHK) CEO to RetireAfter his company's huge budget shortfall and SEC scrutiny into his personal loans, Chesapeake Energy (NYSE: CHK) CEO Aubrey McClendon is leaving the company.<p>Chesapeake Energy (NYSE: CHK) investors are saying goodbye and good riddance to the company's once-hailed co-founder and CEO Aubrey McClendon.</p>
<p>Shares were up 8% today after yesterday's announcement that the CEO would step down on April 1. This comes at the end of a downward spiral for McClendon, who faced scrutiny and criticism after using stakes in company wells to take out personal loans.</p>
<p>But at the height of his career, McClendon's success was very real. He helped co-found the company in 1989 with Tom Ward, the company's former President and COO.</p>
<p>The young company began with horizontal drilling in Texas and Oklahoma, completing an IPO in 1993 and making its first major natural gas discovery in 1994.</p>
<p>This discovery kick-started the momentum that allowed Chesapeake to grow from a company with $50,000 in capital and just two employees into the second-largest natural gas producer in the nation.</p>
<p>The company currently has natural gas operations in the Barnett shale, the Haynesville shale, and the Marcellus shale, and it also operates in the Utica shale, Eagle Ford shale, Niobrara shale, and the Anadarko Basin.</p>
<p style="text-align: center;"><img style="vertical-align: middle; margin: 5px auto; display: block;" src="https://images.angelpub.com/2013/05/18108/chesapeake-energy-operations.jpg" border="0" alt="Chesapeake Energy Operations" /><span style="font-size: 10pt;">Source: <a href="http://www.chk.com/Operations/Pages/Default.aspx" target="_blank">Chesapeake Energy</a></span></p>
<p>But in April 2012, natural gas prices hit a ten-year low, falling below $2. This struck <a href="http://www.energyandcapital.com/resources/natural-gas-companies">natural gas producers</a> particularly hard as they struggled to remain profitable, drilling expensive wells for little reward. To this day, natural gas prices still remain firmly below $4.</p>
<p>That summer, Chesapeake Energy reported a budget shortfall of more than $22 billion that it planned to reconcile through asset sales. In 2012, the company sold between $11 billion and $12 billion in assets. More sales will come this year, as the company still remains saddled with debt.</p>
<p>But McClendon's actions caused even more suffering for the company last year. It was reported that he borrowed over $1 billion in personal loans from stakes in company-owned wells. This raised questions and sparked an inquiry from the Securities and Exchange Commission.</p>
<p>After backlash from shareholders, he was removed as chairman and a number of board members were replaced.</p>
<p>When the announcement of his retirement was made yesterday, shares went up 10% after hours and continued their high ride today. Shareholder approval of this decision was reflected in that move.</p>
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<p align="center" style="font-size: 14pt; font-weight: normal; padding: 0px 5px 0px 5px;">Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our <em>Energy and Capital</em> investment community is sign up for the newsletter below.</p>
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<p>But McClendon does not leave the company on a sour note. He received much praise from billionaire investor Carl Icahn, a major shareholder and one of the company's new board members. From the <a href="http://dealbook.nytimes.com/2013/01/29/chesapeakes-chief-to-retire/" target="_blank">New York Times</a>:</p>
<blockquote>
<p><em>“Aubrey has every right to be proud of the company he has built, the world-class team of people at Chesapeake and the collection of assets he has assembled, which in my opinion are the best portfolio of energy assets in the country,” he said.</em></p>
</blockquote>
<p>Other members of the company also had good things to say. From the <a href="http://www.chk.com/News/Articles/Pages/1779133.aspx" target="_blank">press release</a>:</p>
<blockquote>
<p><em>Archie W. Dunham, Chairman of the Board, stated: “Over the past 24 years, Aubrey McClendon has created one of the most valuable and innovative companies in the energy industry. Under Aubrey’s strong leadership, Chesapeake has built an unmatched portfolio of natural gas and oil assets in creating one of the world’s leading energy companies. He has been a pioneer in the development of unconventional resources, and he has also been a leader in the effort to make the United States energy independent.”</em></p>
</blockquote>
<p>Without McClendon, Chesapeake would not have seen the success it has in its 24 years of existence. But the company hit a major lull this year, and it will take a lot to come back from that.</p>
<p>The scrutiny into McClendon's actions has only exacerbated the company's problems, and investors and the board of directors alike hope new leadership will steer the company in the right direction.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-30T20:59:00Z2013-01-30T20:59:00Z3037Brianna PanzicaSan Francisco 49ers' Solar Powered StadiumThe San Francisco 49ers will go up against the Baltimore Ravens in Super Bowl XLVII...and they'll come home to NRG Energy's (NYSE: NRG) new solar powered stadium...<p>Here in Baltimore, we'll be rooting for our hometown team this Sunday as the Ravens take on the San Francisco 49ers at Super Bowl XLVII in New Orleans.</p>
<p>As one of the most-watched shows in U.S. history, it's bound to be exciting. And regardless of the outcome, the Ravens will come back to a proud city.</p>
<p>But the 49ers will have something else to come home to. By the spring of 2014, the team will have a completely new Santa Clara Stadium designed to take advantage of solar power.</p>
<p>The project is spearheaded by NRG Energy (NYSE: NRG), a power generation and electricity company that puts a focus on clean energy and climate change prevention. In conjunction with the Santa Clara Stadium Authority and the San Francisco 49ers, NRG will bring solar elements to the new stadium sufficient to entirely offset the whole season's worth of home games.</p>
<p>This stadium is the first professional sporting venue that will achieve that net zero capacity. It will be granted LEED certification, or Leadership in Energy and Environmental Design, by the U.S. Green Building Council, for this achievement.</p>
<p>Though it's not yet clear whether the stadium will be granted silver, gold, or platinum standard by the Council, many expect it will qualify for gold.</p>
<p>The renovations are no simple additions, either. The new facility will feature three solar bridges providing covered walkways to the stadium from the main parking area.</p>
<p>The stadium itself will have a green roof – a 27,000 square foot landscaped, living roof canopy that will insulate the suites on the stadium's west side. And other parts of the stadium will also feature solar panels to create a total peak capacity of 400 kilowatts of solar power.</p>
<p>NRG plans to encourage sustainable transportation habits as well. The stadium will have easy access to public transportation, bicycle parking, and connection to a bike path.</p>
<p>From the <a href="http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTY4ODMyfENoaWxkSUQ9LTF8VHlwZT0z&t=1" target="_blank">press release</a>:</p>
<blockquote>
<p><em>“NRG is much more than a Founding Partner, they are providing the energy leadership, infrastructure and expertise to help us achieve the vision of making the new Santa Clara Stadium an economically and environmentally sustainable showcase for innovation,” said Jed York, Chief Executive Officer, San Francisco 49ers. “As we strive to build a stadium that embodies all that is unique and special about both the Bay Area and Silicon Valley, this partnership with NRG will make very lofty goals become realities.”</em></p>
</blockquote>
<p>And if the currently planned projects weren't enough, NRG will continue to participate in updates to the stadium going forward. The company envisions bringing electric vehicle charging stations to the parking lot in the future, as it also detailed in plans for the Washington Redskins' <a href="http://www.energyandcapital.com/articles/nfl-lockout-cant-stop-solar-play/1644">FedEx Field</a>.</p>
<p>NRG is not new to electric vehicle charging infrastructure. It's leading the eVgo project, which aims to install a network of DC fast-charging stations across the country.</p>
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<p>The new Santa Clara Stadium will cost roughly $1.2 billion and have the capacity to seat 68,500 fans. Of that seating, 9,000 will be club seats, and an estimated 165 luxury suites will be included.</p>
<p>In addition to housing the 49ers, the venue will also feature as a concert venue and the hub for other sporting events such as motocross and soccer, as the press release indicates.</p>
<p>And even before it's built, the stadium is already preparing for big things. <em><a href="http://www.ninersnation.com/2013/1/27/3921566/49ers-new-stadium-santa-clara-nrg-energy-environmental-sustainability" target="_blank">Niners Nation</a></em> reports that it is one of just two facilities being considered to host Super Bowl L in 2016.</p>
<p>NRG plans on bringing sustainability to a number of stadiums across the country, including the aforementioned FedEx Field. This sustainability movement in major U.S. sporting stadiums is a huge step for solar expansion, which could benefit not only from the large-scale installations but also from the visibility to such a large and diverse audience.</p>
<p>Solar prices are coming ever closer to parity with fossil fuels, and as the prices stay low, <a href="http://www.energyandcapital.com/resources/solar-energy-companies">solar energy companies</a> that install the arrays will be the ones to benefit.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-29T21:01:42Z2013-01-29T21:01:42Z3033Brianna PanzicaNatural Gas FlaringEven as gas production in North Dakota grows, the percentage of gas flared remains the same. This highlights the shale gas infrastructure problem and the importance of companies with a solution...<p>A new photo was released by NASA showing a satellite image of the United States. The image is fascinating, showing a glowing nation with interconnecting highways.</p>
<p>The big cities, particularly along the East Coast, glowed brilliantly. In the Midwest, the nation grew darker, with bright spots spread sparingly.</p>
<p>For the most part, the light clusters in the image were no surprise; New York was a beacon, as were other major cities, and states like Maine were mainly dark.</p>
<p>But one light cluster stood out. Amid an eerily dark Midwest was the even more eerie light cluster in North Dakota.</p>
<p>That cluster was centered on northwestern North Dakota, and particularly around the town of Williston. By day and from Earth, Williston looks like any small town:</p>
<p style="text-align: center;"><img style="vertical-align: middle; margin: 5px auto; display: block;" src="https://images.angelpub.com/2013/05/18068/williston-nd.jpg" border="0" alt="Williston%2C ND" /><span style="font-size: 9pt;">Source: <a href="http://www.businessinsider.com/youve-never-seen-anything-like-the-williston-oil-boom-2012-3?op=1" target="_blank">Business Insider</a></span></p>
<p>But by night, its lights could rival the bigger cities in the country:</p>
<p style="text-align: center;"><img style="vertical-align: middle; margin: 5px auto; display: block;" src="https://images.angelpub.com/2013/05/18069/north-dakota-nasa.jpg" border="0" alt="North Dakota NASA" /><span style="font-size: 9pt;">Source: <a href="http://www.theglobeandmail.com/report-on-business/top-business-stories/shale-gas-boom-imagery-from-space/article7903922/" target="_blank">The Globe and Mail</a></span></p>
<p>A closer look would show us that those lights aren't from new skyscrapers or a particularly dense area in a sparsely populated state. They're not even all lights focused on North Dakota's abundant oil and gas fields, though that guess would be closer.</p>
<p>No, the lights are actually from flare stacks. And they're burning off valuable natural gas constantly.</p>
<p>Gas flaring has been occurring more in the U.S. within the past several years as natural gas production from the shale boom began to outpace infrastructure development. While railways are available to ship some of the gas, pipelines that would be able to move it in higher quantities call for permits, contracts, and construction time.</p>
<p>Williston, North Dakota is the hub for the <a href="http://www.energyandcapital.com/resources/bakken-oil-field">Bakken shale</a> – one of the most productive shale oil and gas formations in the United States. Pipelines are under construction in the region, but very few are currently operating.</p>
<p>ONEOK Partners' (NYSE: OKS) 525-mile natural gas liquids pipeline is currently under construction. The pipeline is planned to be online this year, moving NGLs to Colorado.</p>
<p>The Tioga pipeline, capable of shipping 106,500 million cubic feet per day to Chicago, is also expected to be complete this year. The pipeline is owned by Alliance Pipeline, a limited partnership between Enbridge Inc. (TSX: ENB) and Veresen Inc. (TSX: VSN).</p>
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<p>But that's not soon enough or enough capacity to stop the flaring taking place there. According to the <em><a href="http://www.ft.com/intl/cms/s/0/ac8b0726-6894-11e2-9a3f-00144feab49a.html#axzz2JIdgfB00" target="_blank">Financial Times</a></em>, oil companies globally have reduced flaring by 20% between 2005 and 2010. But last year alone, North Dakota's flaring grew by 50%.</p>
<p>Overall, roughly 30% of the gas produced in North Dakota is flared on site. And the percentage has stayed stubbornly the same despite the region's constantly increasing production level.</p>
<p>It all comes down to infrastructure; the oil and gas companies just do not have the means to move their natural gas. But they're also losing money by flaring it, and the world is losing the additional resources.</p>
<p>The problem is the same at Texas' Eagle Ford formation, which also shines brightly in NASA's satellite photograph. Last spring, the <em>Financial Times</em> reports, Texas producers flared enough gas to power 400,000 homes.</p>
<p>From the <em>Financial Times</em>:</p>
<blockquote>
<p><em>“The situation in the shale oilfields is similar to the early days of the U.S. oil industry,” said Adam Brandt, a Stanford academic who studies greenhouse gas emissions from fossil fuels.</em></p>
<p><em>“Companies are in a race with their competitors to develop the resource, which means there is little incentive to delay production to reduce flaring.”</em></p>
</blockquote>
<p>But this could all change soon, beginning with a move by officials in North Dakota. The House Taxation and Finance Committee is reviewing a bill that could encourage companies to collect more gas on site.</p>
<p>Under current rules, gas companies are exempt from paying royalties and taxes on flared gas for the first year. But if this new bill passes, the <em><a href="http://www.jamestownsun.com/event/article/id/177700/" target="_blank">Jamestown Sun</a></em> reports, this would be extended to three years, with one condition: the company <span style="text-decoration: underline;">must</span> collect 75% of the gas it produces on site.</p>
<p>New technologies are emerging to enable companies to gather more gas on site and put it to use; the biggest of these, perhaps, is the use of gas in place of diesel to power fracking pumps.</p>
<p>Companies like Apache Corp. (NYSE: APA), in cooperation with Halliburton Co. (NYSE: HAL), Schlumberger Ltd. (NYSE: SLB), and Caterpillar Inc. (NYSE: CAT) are working to develop and make use of this technology, <em><a href="http://news.yahoo.com/fracking-natural-gas-being-powered-170628804.html" target="_blank">Yahoo! News</a></em> reports. PGE is converting a pump to run on a blend of natural gas and diesel.</p>
<p>These technologies will continue to emerge as the shale boom expands. Not only do they reduce the pollution and resources lost in the process, but they also significantly reduce the costs for the companies using them.</p>
<p>When natural gas is flared, it's wasted; no one can use it, and the money and manpower spent extracting it was for naught. But these developing technologies will reduce this waste while increasing the efficiency of gas extraction.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-28T21:10:48Z2013-01-28T21:10:48Z3029Brianna PanzicaNatural Gas Export InvestingThe question now isn't whether we should export natural gas; it's how much. And the debate has some companies fired up.<p>In April 2012 the U.S. economy was still working its way back from the recession.</p>
<p>Unemployment was at 8.1 percent, continuing a slow and bumpy descent from the 2009 high of 10.0 percent. Home sales were growing, but they were still a long way away from pre-recession levels. Retail sales had slowed back down that month after a brief pickup.</p>
<p><em>But the domestic natural gas sector was booming.</em></p>
<p>Natural gas production was becoming the pride of the nation. The shale boom that had been ongoing for several years finally hit the mainstream media.</p>
<p>That same month, natural gas prices fell below $2 to reach ten-year lows.</p>
<p>Since that point, the nation has been buzzing with talk of natural gas exports.</p>
<p><strong>Net Benefit</strong></p>
<p>In Europe and Asia, natural gas prices are substantially higher than they are in the U.S.</p>
<p>European natural gas imports in December were priced at $11.79 per million British thermal units (mmBtu), while Japan's LNG imports were priced at $16.49 per mmBtu.</p>
<p>And though production was still booming in the U.S., the low prices had started to hurt production companies...</p>
<p>European and Asian prices started to look very attractive. In fact, they still do — even with natural gas back up to $3.53 this week.</p>
<p>But exports can't happen until these companies set up contracts with purchasers, find locations for their export terminals, and, most importantly, receive clearance from the Energy Department.</p>
<p>The approval of proposed export terminals has been one of the main energy debates among politicians lately. The Energy Department's recent review of the impacts discovered that natural gas exports would have a “net economic benefit” for the nation over the long term.</p>
<p>After a period of responses from the general public, they now move to a review of the proposed terminals.</p>
<p>It isn't really too much of a mystery at this point. While nothing has been made official, it's starting to look like natural gas exports will happen.</p>
<p>And why not? Exportation would help the production companies and stimulate the economy.</p>
<p><strong>But How Much?</strong></p>
<p>Here's the <em>real</em> question: <span style="text-decoration: underline;">To what extent should these exports occur?</span></p>
<p>It's this very question that has two major energy companies fired up...</p>
<p>Dow Chemical Co. and ExxonMobil Corp. both rely on <a href="http://www.energyandcapital.com/resources/natural-gas-companies">natural gas</a> as part of their operations. Dow Chemical uses natural gas in its chemical production; Exxon is, of course, a major natural gas producer with stakes in the Bakken and other major shale gas deposits.</p>
<p>As it's on the demand side of things, Dow Chemical wants to see a quota set up to limit natural gas exports in order to keep domestic prices from inflating.</p>
<p>But Exxon is a producer. And exports mean revenue. Exxon believes a restriction on exports will taper job growth and economic expansion.</p>
<p>That's shaping up to be the fight that Congress will have to deal with — and not from these two companies alone...</p>
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<p>Companies on the production side will be open to unlimited exports, benefiting from higher prices abroad and the capability to ramp up production of these expensive wells while still bringing in a profit.</p>
<p>But those that use the natural gas, particularly utilities or companies like Dow Chemical, will balk at the idea of a price increase. And prices will rise when this high supply is suddenly tightened.</p>
<p>No one can deny the reality that the U.S. economy could use the boost. Even Dow Chemical and members of the coalition it heads, America's Energy Advantage, support natural gas exports.</p>
<p>But they don't see eye to eye when it comes to how <em>much</em> the U.S. should let exports go unconstrained.</p>
<p>Fortunately, the benefit for investors like you is there regardless of companies' opinions...</p>
<p>When natural gas exports are approved, prices will jump (if Dow gets its way, they won't increase much — but they'll go up nonetheless) and producers will thrive.</p>
<p>Natural gas will create jobs. It will create revenue. And it will bring you profits.</p>
<p>You'll want to position yourself <em>before </em>natural gas becomes a major export.</p>
<p>Good Investing,</p>
<p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica for <em>Energy and Capital</em></p>
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<p><strong><a href="http://www.wealthdaily.com/articles/china-covets-us-coal/3928?r=1&lloct=2&r=1">China Covets U.S. Coal</a>: This Little-Known Aussie Stock Could Launch</strong><br />The Hammer talks about beaten-down commodities in a rising market. China demands coal... but where will it get it? And who will benefit?</p>
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<p><strong><a href="http://www.wealthdaily.com/articles/german-gold-repatriation/3918?r=1&lloct=2&r=1">German Gold Repatriation</a>: Trust No Longer Exists</strong><br />The big news last week was the initial announcement by Germany that they would be repatriating their gold back to Germany and the political rhetoric that followed.</p>2013-01-27T04:00:00Z2013-01-27T04:00:00Z3022Brianna PanzicaFirst Canadian LNG Export FacilityThe Douglas Channel LNG Project is set to be the first LNG export facility in Canada, tapping much-desired Asian markets...<p>Canada's first LNG export facility has finalized contracts for 700,000 tons of its liquefied natural gas.</p>
<p>Golar LNG Ltd. (NASDAQ: GLNG), an LNG tanker company based in Bermuda, and LNG Partners LLC. have signed sales agreements with BC LNG Export Co-operative LLC, owner of the Douglas Channel LNG Project.</p>
<p>The Haisla First Nation and Douglas Channel Gas Services Ltd. are partners in the export facility. Its initial capacity of 700,000 is expected to come online in the start of 2015.</p>
<p>The facility itself will be located on the coast of British Columbia, an ideal location for supplying the enticing Asian markets.</p>
<p>And the Douglas Channel is not alone in its desire to tap Asian markets. Apache Corp. (NYSE: APA) and Chevron Corp. (NYSE: CVX) were also granted an LNG export license from the Canadian government for their Kitimat LNG project.</p>
<p>And majors like Royal Dutch Shell PLC (NYSE: RDS.A), BG Group PLC (LON: BG), Petronas, and Exxon Mobil Corp. (NYSE: XOM) are also supporting facilities in the region.</p>
<p>But the Douglas Channel project will be the first to come online, making BC LNG the first major Canadian exporter of LNG.</p>
<p>Asian markets have been attractive to LNG suppliers since the start of the North American shale boom due to their much higher natural gas retail price. While natural gas was selling for $3.57 per million Btu in the U.S. last week, the <em><a href="http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/bc-lng-inks-sales-contract/article7563307/" target="_blank">Globe and Mail</a></em> reports, it was a whopping $17.35 in Japan and South Korea.</p>
<p>But lately BC LNG has been faced with a problem.</p>
<p>From the <em>Globe and Mail</em>:</p>
<blockquote>
<p><em>“What we're seeing is that the Asian marketplace is now beginning to embrace the North American gas indices as the pricing forum,” said Tom Tatham, managing director of BC LNG.</em></p>
</blockquote>
<p>The hope of producers interested in the Asian markets was that the gas would sell for the higher price and provide much-needed financial relief, particularly at a time when low North American sale prices were barely cutting it considering the high production cost at the well.</p>
<p>In addition to the change in selling price, the project has also faced a number of other setbacks. Completion was initially scheduled for early 2014. Tatham cited “various reasons” for the year-long delay on the project.</p>
<p>And the price will also go up. Though an exact number hasn't been given, the <em><a href="http://www.calgaryherald.com/business/lines+buyers+suppliers/7849769/story.html" target="_blank">Calgary Herald</a></em> says that it could be “millions more than its $400-million initial capital budget.”</p>
<p>This is due in part to addition of a 45-megawatt electrical generation plant, not initially included in the cost.</p>
<p>The gas-powered plant is coming after new rules now require the export facility to be self-sufficient. Electricity is required to chill the <a href="http://www.energyandcapital.com/resources/natural-gas-companies">natural gas</a> for transportation, and the original plan was to simply tap the grid.</p>
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<p>Tatham is currently working on deals with foreign buyers, talking to customers in Japan.</p>
<p>From the <em>Calgary Herald</em>:</p>
<blockquote>
<p><em>“The bidding procedures didn't provide a huge uplift to the producers but it will be overall beneficial to those who participated,” he said.</em></p>
<p><em>“Our initial hope was we could do something significantly in excess of index (but) there's been a fundamental shift in the marketplace.”</em></p>
</blockquote>
<p>Despite the lower-than-expected pricing system coming from these Japanese buyers, the sales will be sure to set up a mutually beneficial relationship.</p>
<p>Signing producers onto the project hasn't been as easy, Tatham said. But even with these setbacks, the Douglas Channel LNG Project is pushing ahead, and it's still set to be the first operational LNG export facility in Canada, a victory for BC LNG.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-22T20:22:11Z2013-01-22T20:22:11Z3014Brianna PanzicaMiddle East, Africa Could Thrive on Solar PowerIn oil producing nations where high oil prices and higher domestic consumption are hurting revenue, renewable power could thrive...<p>The oil industry is starting to experience a shift in supply and demand distribution.</p>
<p>Many oil producers, particularly nations in the Middle East and North Africa, are beginning to develop. Citizens are demanding a higher standard of living, energy demand is growing, and domestic resources are stretching thin.</p>
<p>Saudi Arabia is an example of this. Currently the world's largest oil producer, the Middle Eastern nation is feeling the change in dynamic as demand grows. Even the IEA has predicted that the United States will surpass Saudi Arabia's production level in under a decade.</p>
<p>The same is true for other nations as well. When OPEC producers are not struggling to keep up with supply due to geopolitical tensions, their issue is with domestic demand.</p>
<p>But oil and petroleum resources aren't the only options these nations have for energy consumption, nor are they necessarily the cheapest.</p>
<p>Brent crude, the European benchmark, on average sells for more than $110 per barrel. And even though these producing nations have the advantage of subsidized prices, <em><a href="http://www.bloomberg.com/news/2013-01-21/first-solar-abengoa-bullish-on-mideast-africa-power.html" target="_blank">Bloomberg</a></em> reports that a barrel will still cost them an average of $90 per barrel.</p>
<p>The cost isn't low, particularly for these nations that receive a large portion of their revenues from oil exports. And when they consume the product they rely on selling, the overall cost is much higher.</p>
<p>But First Solar (NASDAQ: FSLR) and Abengoa SA (MCE: ABG) see opportunity for another type of power in the regions. The renewables companies believe solar power, at its now low cost, could hold a great deal of promise in the Middle East and North Africa.</p>
<p>First Solar is a producer of photovoltaic cells, which have plummeted in price recently. The cells and the panels they're built into convert solar power into electricity on contact.</p>
<p>Abengoa's tactic is slightly different with its concentrated solar power (CSP) plants. These plants, which cost slightly more than photovoltaic cells, use mirrors to focus sunlight on a liquid inside a turbine, which turns when the liquid is heated into steam.</p>
<p>And though CSP plants cost more, they're more reliable than <a href="http://www.energyandcapital.com/resources/solar-energy-companies">solar panels</a>, which can only produce electricity during sunny hours. CSP plants, on the other hand, can make use of natural gas or other sources when the sun isn't out to keep the turbine moving.</p>
<p>But both would bring opportunity to the Middle East and North Africa. Both could reach parity with the prices these oil producers currently pay to consume oil. But they would also allow the nations to send that oil back into their exports.</p>
<p>From <em>Bloomberg</em>:</p>
<blockquote>
<p><em>“The Middle East and Africa are areas where we see opportunities in the short term,” Abengoa Solar Chief Executive Officer Santiago Seage said in an interview the same day. Abengoa Solar's CSP facilities are well suited to the region since gas is available to help run turbines at its plants, boosting generation capacity and allowing for potentially constant supply, he said.</em></p>
</blockquote>
<p>First Solar, one of the few U.S. makers of photovoltaic cells that withstood the price plunge, still took a hit.</p>
<p>But to fix the downtrend, the company has begun to refocus its business on power plant production. Its plants are made for utility use – a big step from its previous business model of just solar module manufacturing.</p>
<p>The company believes oil producing nations overseas could benefit from these types of power plants, and it's noticed higher demand internationally.</p>
<p>Abengoa SA, a Spanish company, has already started projects in these regions. In Abu Dhabi, its Shams 1 power plant is capable of producing 100 megawatts of power. It's also working on closing two deals in South Africa.</p>
<p>First Solar has gained over 100% in the last six months.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-21T21:06:16Z2013-01-21T21:06:16Z3008Brianna PanzicaGeopolitical Tensions Shake Up Oil ProductionThe attack on an Algerian natural gas field has halted oil and natural gas production. What is the cost of this hit to production in a world constantly demanding more?<p>On Wednesday, militant forces attacked an Algerian natural gas field.</p>
<p>Varying reports claim anywhere from 50 to 132 hostages were taken from the site by an al Qaeda-linked group after it attacked the In Amenas facility jointly owned by Statoil (NYSE: STO) and BP (LON: BP).</p>
<p>The attack was followed by a raid by the Algerian military in an attempt to foil the assailants. Claims that 35 of the hostages are dead have been reported.</p>
<p>Regardless of what the details turn out to be, the attack is undoubtedly tragic. Some news agencies are reporting hostages escaped; others say a large number were freed; still others are reporting only a few are alive, and still held by kidnappers.</p>
<p>Needless to say, the extent of the effects are unclear.</p>
<p>But what is clear are the implications this attack will have for oil...</p>
<p>Algeria is one of OPEC's twelve members. The nation produces almost 1.2 million barrels of crude oil per day and is responsible for 698,000 bpd in crude oil exports and 52.02 billion cubic meters in natural gas exports. The United States is one of its major customers, importing an average of 358,000 barrels of crude per day in 2011 and 186,000 bpd in October last year.</p>
<p>This attack, analysts have said, will take 24 million cubic meters a day of gas and 60,000 barrels a day of liquids offline — and no one can say how long this production halt will last.</p>
<p><strong>Price Surge</strong></p>
<p>In the midst of the turmoil overseas, the U.S. reported a sudden and significant drop in oil stockpiles.</p>
<p>Contrary to the gain analysts expected, U.S. oil stocks dropped by more than one million barrels last week.</p>
<p>Between these two pieces of news, oil prices surged.</p>
<p>On Wednesday, crude for February delivery was gaining on $95 a barrel, and on Thursday it broke that mark, rising to as high as $96.04 during the day before settling back down.</p>
<p>But this could mark the start of an even bigger climb in oil prices, which have been flirting with the $100 mark.</p>
<p>Nick Hodge told you this week that <a href="http://www.energyandcapital.com/articles/crude-oil-investments/2991">$100 oil</a> is just around the corner. The price has been hovering just below that level for a while.</p>
<p>Demand will keep increasing... production, on the other hand, will not. Compared to consumption, production will taper off.</p>
<p>Some of this might be a result of rising consumption from the producing nations. Saudi Arabia, for example, has seen demand increase, particularly in the last five years:</p>
<p><img style="vertical-align: middle; margin: 5px auto; display: block; border: 1px solid black;" src="https://images.angelpub.com/2013/03/17926/saudi-arabia-oil-consumption-chart.jpg" border="0" alt="Saudi Arabia Oil Consumption Chart" /></p>
<p>But some will also be a result of continuing geopolitical tensions.</p>
<p>The attack in Algeria is just the latest of these problems. Libya's production is only just recovering after the civil war that all but stopped oil exports. Iran's exports have fallen dangerously low — particularly for a nation whose budget relies on oil revenues — after its covert nuclear program sparked Western sanctions.</p>
<p>And when oil supplies are low, prices are sure to be high.</p>
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<p><strong>The World's <em>New</em> Biggest Oil Producer</strong></p>
<p>U.S. oil production, meanwhile, continues to grow. The report of falling stockpiles, while not good news, was countered by the fact that supplies are <em>still</em> higher than they would normally be this time of year.</p>
<p>Domestic oil production is at a 20-year high — but it's not stopping there...</p>
<p>The IEA expects the U.S. to surpass Saudi Arabia, <span style="text-decoration: underline;">the world's biggest oil producer</span>, in about seven years.</p>
<p><em>This means domestic production will provide a safe ride for the decade to come.</em></p>
<p>Then again, so will <a href="http://www.energyandcapital.com/articles/oil-oil-stocks-to-head-higher/2946">crude oil</a> in general. Because prices are going to continue to ride high — and move even higher — as rising consumption battles with struggling production overseas.</p>
<p>If you prefer to stay domestic, there are still companies that will provide safe entryways into U.S. oil production.</p>
<p>Threats on international oil reserves are going to push the price of oil up — and that means increased demand for growing U.S. production...</p>
<p>Don't miss your chance to profit.</p>
<p>Good Investing,</p>
<p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica<br />for <em>Energy and Capital</em></p>
<p><strong><a href="http://www.wealthdaily.com/articles/are-you-a-contrarian-indicator/3899">Are YOU a Contrarian Indicator?</a>: Investments Tend to Surge at Market Tops</strong><br />Did you invest money in the U.S. stock market last week? If you did, you may have just bought a short-term top in stock prices.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/oil-pipeline-investing/2979">Oil Pipeline Investing</a>: Could THIS Man Kill TransCanada's Pipeline?</strong><br />A long-delayed decision is drawing nearer, and the fate of TransCanada's XL Pipeline is in this man's hands.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/when-to-sell/3901">When to Sell</a>: Is the Market Cheap? How You Know...</strong><br />When do you have to sell your 401(k)? When should you? Is the market cheap? How do you know? Check out this long-term P/E chart of the S&P and decide for yourself...</p>
<p><strong><a href="http://www.wealthdaily.com/articles/on-the-constitution-gun-rights-criminal-bankers-and-silver/3914">On The Constitution, Gun Rights, Criminal Bankers, and Silver</a>: Buy a Gun, Buy Silver</strong> <br />The Federal Reserve has never been an agent of the government; it is a creation of the bankers. You see, the government cannot control the banks because the banks control the government.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/a-flood-of-unconventional-gas/2988">A Flood of Unconventional Gas</a>: Shale Gas Profits</strong><br />Editor Keith Kohl explains why shale gas production is the key to our cheap, abundant alternative to crude oil.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/what-are-you-paying-for/3906">What Are You Paying For?</a>: Pros are Getting Paid to Underperform</strong><br />Ignore their hype. Managed funds are terrible. You're better off on your own and here is why...</p>
<p><strong><a href="http://www.energyandcapital.com/articles/crude-oil-investments/2991">Crude Oil Investments</a>: Get In Tune, Get In the Money</strong><br />We need to start producing at least 8 million more barrels of oil per day in the next few years. Because the world has never increased crude production this fast, I'm extremely bullish on crude oil and the companies that will be producing it.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/germany-starts-a-central-bank-run/3909">Germany Starts a Central Bank Run</a>: The Bundesbank Starts a Run on Gold</strong><br />Everything the Bundesbank does is close to perfection. The very fact that it is calling in its gold is monumental in terms of questioning the "full faith and credit" of the United States Treasury...</p>
<p><strong><a href="http://www.energyandcapital.com/articles/the-government-said-i-lied-about-the-bakken/2997">The Government Said I Lied About the Bakken</a>: Why Being Ahead of the Curve Makes the Establishment Uncomfortable</strong><br />In January 2008 I commissioned my research staff to investigate and to produce a report on the Bakken. I gave them two months to give me their findings... They did it in one.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/shale-gas-101/3002">Shale Gas 101</a>: U.S. Shale Formations</strong><br /><em>Energy and Capital</em>'s Keith Kohl takes a closer look at three of the top shale gas plays in the United States.</p>2013-01-19T16:00:00Z2013-01-19T16:00:00Z3001Brianna PanzicaCNG Fueling CorridorWest Virginia will use natural gas from the Marcellus shale to fuel state vehicles with its new CNG Fueling Corridor.<p>Last year, Clean Energy Fuels Corp. (NASDAQ: CLNE) began the first major project for natural gas fueling infrastructure since the shale boom pushed natural gas prices through the floor.</p>
<p>Called America's Natural Gas Highway, the effort to build 150 LNG fueling stations on major trucking highways across the United States got underway with 70 stations in 2012. The remaining 80 will be complete by the end of this year.</p>
<p>But this project was just part of a national focus on natural gas for fueling. Honda rolled out a natural gas version of its Civic last year, while a number of companies began shifting fleets over to natural gas vehicles.</p>
<p>But a major problem underlying a more universal shift was a lack of infrastructure on both sides. Without more vehicles (the Civic was the only natural gas passenger vehicle of 2012), fueling companies did not find it feasible to invest in filling stations. And without filling stations, auto makers didn't foresee a demand for vehicles.</p>
<p>The change is slow but visible. Clean Energy's project is made for trucks, appearing mainly at Pilot-Flying J Travel Centers. But truck fleets will likely be the first to shift to <a href="http://www.energyandcapital.com/resources/natural-gas-companies">natural gas</a> use, as companies will recover the cost of converting the vehicles by using the cheap fuel in place of diesel.</p>
<p>The next group to take the plunge, before passenger vehicles, will likely be government and business fleets. And it's with that in mind – as well as the citizens that will benefit in the future – that IGS Energy CNG Services has agreed to develop a Compressed Natural Gas (CNG) Fueling Corridor in West Virginia.</p>
<p>The corridor will consist of three CNG filling stations along Interstate 79, costing a total of somewhere around $10 million.</p>
<p>The first station will be located in Charleston, with two more also starting construction in the first quarter. IGS Energy expects all three to be complete before the end of the year.</p>
<p>West Virginia's Department of Highways will be the first to take advantage of the new stations. It has committed to purchasing 20 state vehicles capable of filling up at these CNG stations.</p>
<p>Companies such as Antero Resources, Chesapeake Energy Corp. (NYSE: CHK), and EQT Corp. (NYSE: EQT) have also agreed to make use of the stations with their fleets.</p>
<p>But the stations will also be open to the public, and anyone who owns a CNG vehicle will have the privilege of using the stations. And the development will also likely have the effect of boosting CNG vehicle purchases.</p>
<p>From the <em><a href="http://www.dailymail.com/Business/201301170086?page=1&build=cache" target="_blank">Charleston Daily Mail</a></em>:</p>
<blockquote>
<p><em>“West Virginia has been blessed with an abundance of natural gas, and I'm extremely appreciative of the many dedicated folks who are working hard to find the best way for our state to use it as a cost-saving means of transportation,” [Governor Earl Ray] Tomblin said.</em></p>
</blockquote>
<p>The “abundance of natural gas” he refers to is gas from the Marcellus shale, on which West Virginia is located. And the fueling stations, IGS Energy's West Virginia operations manager T.J. Meadows said, will use gas extracted from within the state.</p>
<p><div style="border: 3px solid #00456b; border-radius: 7px; padding: 0px; margin-bottom: 15px; background: #fff;">
<h2 style="text-align: center; color: #fff; background: #00456b; border-radius: 3px 3px 0px 0px; margin-top: 0px; padding: 5px;">The Best Free Investment You'll Ever Make</h2>
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<p align="center" style="font-size: 14pt; font-weight: normal; padding: 0px 5px 0px 5px;">You'll also get our free report, <em>"<strong>2015 Natural Gas Forecast</strong>" </em>by our resident expert Keith Kohl.</p>
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<p>CNG, on average, costs roughly $2.10 per gallon. The average price for gasoline in the U.S. this week was $3.30 per gallon, and diesel cost an average of $3.89 per gallon.</p>
<p>And while natural gas vehicles typically do cost more than standard gasoline- or diesel-powered vehicles, drivers in West Virginia can also take advantage of an Alternative Fuel Tax Credit. For converting passenger vehicles, this credit can be as high as $7,500. For industrial vehicles over 26,000 pounds, the credit can be $25,000.</p>
<p>Consumers can also purchase conversion kits to switch standard vehicles over to natural gas. These, Meadows told <em><a href="http://www.businessweek.com/ap/2013-01-17/igs-energy-to-build-natural-gas-stations-on-i-79" target="_blank">BusinessWeek</a></em>, can cost between $2,000 and $10,000, but it will take under two years to recover the cost considering the difference in fueling price.</p>
<p>IGS doesn't plan to stop its construction in West Virginia. The company is considering similar projects in Ohio, home to the Utica shale, and Pennsylvania, also on top of the Marcellus.</p>
<p>Not all passenger vehicles can be converted to natural gas, but enough can to make this Compressed Natural Gas Fueling Corridor a promising venture. And it's ventures like these that will spark a shift in U.S. passenger vehicle fueling as the shale boom presses on.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-18T21:19:26Z2013-01-18T21:19:26Z3005Brianna PanzicaBillionaire Investor Buys Stake in Oil CompanyTransocean (NYSE: RIG) is still recovering from the backlash of the 2010 Gulf oil spill, and billionaire Carl Icahn wants to help.<p>Billionaire investor Carl Icahn is known for his activism when it comes to suffering energy companies.</p>
<p>When Chesapeake Energy (NYSE: CHK) was struggling under the direction of CEO Aubrey McClendon, who used company loans for personal business, Icahn bought into the company, removed McClendon as chairman, and replaced a large portion of the board of directors.</p>
<p>He did the same for oil company CVR Energy Inc. (NYSE: CVI) last year. The company has gone on to create a master limited partnership, CVR Refining, LP, which will IPO tomorrow under the symbol “CVRR.”</p>
<p>Now he has something in the works for international drilling service provider Transocean LTD (NYSE: RIG).</p>
<p>Transocean owned the oil rig involved in the massive April 2010 blowout in the Gulf of Mexico that killed 11 people and spilled over 200 million gallons of oil into the waters. Barely two weeks ago, the company reached an agreement with the U.S. government over the spill in which it agreed to pay $1.4 billion.</p>
<p>Shares have fallen over 32% since April 2010. The company has been able to regain more than 36% in the past year, but it still hasn't recovered completely.</p>
<p>But that's where Icahn comes in. In an effort to turn things around, the billionaire announced this week that he had purchased 1.56% of the company's shares, and he is now seeking permission to purchase more than 3% at an estimated $682.1 million.</p>
<p>He has so far been silent on his motives behind the purchase, but analysts have their suspicions. A number suspect the move is the start of an effort to turn Transocean into a master limited partnership, or MLP.</p>
<p>From <em><a href="http://www.bloomberg.com/news/2013-01-16/icahn-s-stake-pushes-transocean-closer-to-partnership-spi.html" target="_blank">Bloomberg</a></em>:</p>
<blockquote>
<p><em>“I would guess he's going after an MLP because there aren't a whole lot of other levers to pull,” Joe Hill, an analyst at Tudor Pickering Holt & Co. in Houston said in a telephone interview.</em></p>
</blockquote>
<p>The company has been fairly successful in boosting shares on its own following the spill. <em>Bloomberg</em> analysts expect the company will report earnings of $3.39 billion last year, nearly doubled from 2011.</p>
<p>Transocean has also begun construction on nine <a href="http://www.energyandcapital.com/articles/shells-arctic-oil-disaster/2584">oil rigs</a> and sold other rigs for a total of $1.05 billion.</p>
<p>BP (LON: BP), the Deepwater Horizon rig operator, has not been doing as well. In the last year, shares have lost more than 3%. The company is still involved in civil litigations after pleading guilty to manslaughter and agreeing to pay $4.5 billion in a criminal case.</p>
<p>Some analysts don't think there's much Icahn can do for Transocean, as the company's legal settlement has already been made and shares have only been going up. Others are concerned the timing is off.</p>
<p>From <em>Bloomberg</em>:</p>
<blockquote>
<p><em>“A year ago, you could see some incremental pockets of value in squeezing some stuff out, but now some of those have been resolved and you're left wondering,'What's left for him to really change?” [Raymond James' Collin] Gerry said. “Maybe it's the MLP structure.”</em></p>
</blockquote>
<p>Transocean shares fell immediately following the news, but they closed up 1.48% on Wednesday. Reactions have been mixed, but more details should emerge soon regarding both Icahn's and Transocean's intentions.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-16T21:16:17Z2013-01-16T21:16:17Z2998Brianna PanzicaTesla Motors' (NASDAQ: TSLA) Model XTesla (NASDAQ: TSLA) reveals a model and details on its Model X at the Auto Show in Detroit, as well as details on its cheaper vehicle.<p>This year's North American International Auto Show in Detroit kicked off this week. The show has so far been light on showcasing electric vehicles, but it hasn't lacked them entirely.</p>
<p>Companies with new electric vehicles or plug-ins on the way, like Nissan (TYO: 7201), for example, may not have discussed them in their press conferences. But the vehicles were there.</p>
<p>Nissan recently announced it would roll out an updated version of its LEAF, and a model was on display at the Auto Show. The vehicle is to have a starting price of about $28,800 before rebates, which could bring the price as low as $19,000.</p>
<p>Via Motors revealed its X-Truck, a large electric truck with 800 horsepower. The company is exploring contracts with PG&E (NYSE: PCG) to create vehicle-to-grid connections for emergency situations such as mass power outages, <em><a href="http://www.plugincars.com/2013-detroit-show-pushes-plug-margins-126108.html" target="_blank">PluginCars</a></em> reports.</p>
<p>And Tesla Motors (NASDAQ: TSLA), the company whose much-anticipated Model S was released last year, had more to say on the next project it's working on.</p>
<p>The Model X isn't new news to Tesla fans. It was officially unveiled by CEO Elon Musk back in February 2012. But a preproduction model was finally on display at the Auto Show on Monday.</p>
<p><img style="float: left; margin: 5px; border: 0px;" src="https://images.angelpub.com/2013/03/17889/tesla-model-x.jpg" border="0" alt="Tesla Model X" title="Tesla Model X" />Set for deliveries in 2014, the Model X is Tesla's first luxury SUV. The company revealed additional details about the vehicle in a press conference at the show today, calling it a “continuation” of its first car, the Model S.</p>
<p>The company compared the vehicle to a Porsche 911 – but better, since it's electric.</p>
<p>It will feature what the company has dubbed “Falcon Wing” doors. The design is similar to the “gull wing” doors present on the DeLorean of the 1980s, but rather than swinging back and up, the doors rise straight overhead.</p>
<p>With its three rows of seats, the vehicle can seat the driver and up to six passengers. In its model presented at the auto show, the interior uses a mixture of white and black, with each row of seats covered in alternating colors.</p>
<p>The alternating color scheme continued throughout the entire car, both inside and out. Like the Model S, the car comes with the options of a 60 or 85 kWh battery and a 17-inch touch screen for entertainment, navigation, and even some controls for the driver.</p>
<p>But this is an SUV, capturing an audience the Model S cannot.</p>
<p>From the <em><a href="http://blogs.windsorstar.com/2013/01/15/electric-tesla-model-x-to-compete-with-premium-suvs-minivans/" target="_blank">Windsor Star</a></em>:</p>
<blockquote>
<p><em>“We looked at the marketplace and realized that minivans are incredibly practical and they serve a great purpose, but you kind of sell your soul a little bit in order to get that practicality,” said [chief designer Franz] von Holzhausen. “An SUV or crossover has all the character and styling you want in a vehicle but not necessarily that practical in its usability.”</em></p>
</blockquote>
<p>But according to Tesla's <a href="http://www.teslamotors.com/modelx" target="_blank">website</a>, the Model X combines “the best of an SUV with the benefits of a minivan, as only an electric car can.”</p>
<p>Though the company has yet to reveal a specific price tag for the new vehicle, von Holzhausen indicated that it would be between 5 and 10 percent more than the Model S, which starts at $57,400.</p>
<p>Tesla also announced a plan to expand in 2013. The company currently has 33 stores across the globe, with 23 in North America. It added 13 of those last year alone.</p>
<p>This year, the expansion will move ahead even more quickly. The company has plans to open a total of 25 retail locations, including its first Chinese store, with half of the locations in the U.S.</p>
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<p>And it's still planning a cheaper <a href="http://www.energyandcapital.com/articles/2013-electric-vehicles/2917">electric vehicle</a>, with a tentative date set for 2016. This new car will be priced closer to $30,000 – in line to compete with the BMW 3 Series, the company announced.</p>
<p>As Tesla's sales executive George Blankenship said:</p>
<blockquote>
<p><em>“We want to take away every hurdle there is to people driving electric cars.”</em></p>
</blockquote>
<p>While a $30,000 vehicle may not take away every hurdle, it could come close to doing what Nissan plans to do with its lower-priced LEAF.</p>
<p>Blankenship claims that the company's mission is to reduce the use of fossil fuels, not just sell cars, the <em><a href="http://www.freep.com/article/20130115/BUSINESS03/130115052/Tesla-Motors-reveals-Model-X-brags-s-1-electric-vehicle-development" target="_blank">Detroit Free Press</a></em> reports. This is reflected in the sales model – you can walk into a Tesla store without feeling pressured to buy a car.</p>
<p>And as the company evolves to support a wider customer base, its mission will move forward too.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-15T20:51:54Z2013-01-15T20:51:54Z2993Brianna PanzicaCanadian Pipeline ProjectsStill awaiting a decision on the Keystone XL Pipeline project, TransCanada (TSX: TRP) is keeping busy with projects in Canada.<p>TransCanada Corp. (TSX: TRP) may not be getting any love in the United States, but its home nation of Canada is more than making up for that.</p>
<p>The company behind the proposed Keystone XL Pipeline, still awaiting approval for a Presidential Permit more than two years after receiving approval in Canada, is moving ahead much more quickly with projects in Canada.</p>
<p>Last week TransCanada announced it had been chosen by the Canadian arm of Malaysian company Petroliam Nasional Bhd (Petronas) for the Prince Rupert Gas Transmission project, an LNG pipeline worth roughly $6.58 billion.</p>
<p>The pipeline would move LNG from British Columbia's Montney shale deposit to Progress Energy Canada's planned export facility in Port Edward.</p>
<p>Progress Energy Canada, formerly known as Progress Energy Resources Corp., was acquired by Petronas for $5.28 billion at the end of last year.</p>
<p>Its export facility is the latest effort from Canada to ship LNG to Asian customers after exports to the U.S., one of its biggest customers, were slowed amid the U.S. shale boom. The facility will cost roughly $11.2 billion.</p>
<p>TransCanada's pipeline will have an initial capacity of 2 billion cubic feet of liquefied natural gas per day, expandable to 3.6 billion cubic feet per day.</p>
<p>The pipeline itself will cost roughly $5.1 billion, but TransCanada will spend up to an additional $1.5 billion on connecting it to its NOVA regional pipeline network.</p>
<p>Once the Prince Rupert Project is connected to NOVA, it will have access to other areas in the Montney shale as well as Alberta gas deposits.</p>
<p>This project is good news for a company that has been struggling with the postponement of the Keystone XL decision in the U.S.</p>
<p>From <em><a href="http://uk.reuters.com/article/2013/01/09/transcanada-progressenergy-idUKL4N0AE57C20130109" target="_blank">Reuters</a></em>:</p>
<blockquote>
<p><em>TransCanada expects to get continued support from British Columbia communities. “Recently we have built about C$1 billion of infrastructure in northeast B.C.,” Russ Girling, TransCanada's chief executive, said in an interview. “Our process of community engagement and consultation has worked well for us and I believe those communities trust us.”</em></p>
</blockquote>
<p>Construction will get underway once Progress and TransCanada finalize the details, and the Prince Rupert Gas Transmission Project should be complete by 2018.</p>
<p>But this isn't the only project TransCanada will be working on in the region. In June last year, the company was selected for another <a href="http://www.energyandcapital.com/articles/natural-gas-goes-global/2700">LNG pipeline</a>.</p>
<p>Coastal GasLink, worth $4 billion, will bring LNG to a Kitimat, British Columbia export terminal proposed by Royal Dutch Shell Plc (NYSE: RDS.A), Mitsubishi Corp. (TYO: 8058), Korea Gas Corp. (KRX: 036460), and PetroChina Co. (NYSE: PTR).</p>
<p>From <em><a href="http://www.businessweek.com/news/2013-01-09/transcanada-to-develop-5-dot-1-billion-pipeline-to-lng-terminal" target="_blank">Businessweek</a></em>:</p>
<blockquote>
<p><em>“It looks like TransCanada is going to be the builder of choice to get gas to the West Coast, with two pipelines running two separate paths, one to Prince Rupert and one to Kitimat,” said Steven Paget, an analyst at FirstEnergy Capital Corp. in Calgary.</em></p>
</blockquote>
<p>Between the two pipelines, TransCanada will have plenty to keep it occupied regardless of how the Keystone XL decision plays out. The company is still looking forward to a positive decision on the Keystone project, but these two pipelines will give the company security.</p>
<p>TranCanada shares rose 2.41% to close at $48.39 last Wednesday when the company made the announcement. Shares were at $48.37 on Monday afternoon.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-14T20:05:32Z2013-01-14T20:05:32Z2987Brianna PanzicaOil Transportation InvestingU.S. oil production is skyrocketing. But without the proper resources, this growth can only continue for so long...<p>There's no shortage of good news lately when it comes to U.S. oil production...</p>
<p>Since the fracking boom really took off in the United States, the country has been surpassing one milestone after the next.</p>
<p>This week production hit a 20-year high. The U.S. Energy Department announced oil production had surpassed 7 million barrels per day to hit 7.002 million barrels per day on average.</p>
<p>North Dakota, home of the Bakken Shale, saw a 40% growth in production in the ten months through October.</p>
<p>Texas, where the Eagle Ford Formation is located, grew production by 23%.</p>
<p>Production will average out to around 7.3 mbpd this year, and by next year it will be at a 26-year high of 7.9 mbpd.</p>
<p>It's clear that the Bakken is the fastest-growing of these areas. The formation is well known all across the country, and unemployment in Williston, North Dakota, the Bakken's hub, is an incredible 1%.</p>
<p>But an abundant supply of oil isn't all it takes to go from small town to boomtown...</p>
<p>The location needs resources —lots of them.</p>
<p><strong>Moving Oil</strong></p>
<p>One of the biggest resources any oil-producing region needs is transportation infrastructure.</p>
<p>Oil can't just stay at the wells; it has to be moved to refineries and then to the location where it will be used. And pipelines are the best way to get the job done. They can go long distances, and they can run underground so as to not disrupt life above.</p>
<p>But they also require lengthy regulatory processes and construction time.</p>
<p>The Keystone XL Pipeline, figuring strongly in the presidential debates and still anxiously awaiting approval, is a prime example.</p>
<p>TransCanada's (TSX: TRP) international pipeline was approved by Canada back in 2010, but the process of receiving a Presidential Permit from the U.S. Department of State has been a tedious one.</p>
<p>A report from the Nebraska Department of Environmental Quality that showed “minimal environmental impacts” may force the president's hand in a decision. But even if the permit is granted in the first quarter of this year — the earliest possible — construction time could push the start-up date to as far in the future as 2015.</p>
<p>And as projects like these are delayed, production is maintaining its rapid pace. More oil needs to move to refineries, and it will be years before it can safely rely on these slow-to-move pipelines</p>
<p>But pipelines aren't the only ways oil can move...</p>
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<p><strong>All Aboard!</strong></p>
<p>This week, Phillips 66 (NYSE: PSX) announced it would be involved in a contract to ship Bakken crude by railroad to refineries in New Jersey.</p>
<p>Unlike pipelines, railways are already in place; they don't require any preliminary approvals or construction time. All the companies need are contracts and proper rail cars.</p>
<p>Phillips 66 is far from the first rail company to become involved in the Bakken. Billionaire investor Warren Buffett got into Bakken oil shipments early when he purchased the Burlington Northern Santa Fe (BNSF) railroad company.</p>
<p>His company was able to increase crude shipments by 40% this year alone. Next year, they're likely to grow even more — even if the Keystone XL approval goes as smoothly as possible.</p>
<p>As Jeff Siegel told you this week, railways will be the major <a href="http://www.energyandcapital.com/articles/warren-buffett-bakken-shale-investment/2960">transportation infrastructure</a> in high oil-producing areas like the Bakken for years to come.</p>
<p style="margin-bottom: 1em;">Good Investing,</p>
<p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica<br />for <em>Energy and Capital</em></p>
<p><strong><a href="http://www.wealthdaily.com/articles/2-data-points-and-3-trends-for-q1/3892">2 Data Points and 3 Trends for Q1</a>: This Changes Everything</strong><br />For the first time in three years, consumer credit card debt has improved for three consecutive quarters. Less debt means more disposable income.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/a-brief-history-of-fracking/2972">A Brief History of Fracking</a>: Before Matt Damon, There was Colonel Edward Roberts</strong><br />Nobody knew it at the time, but Roberts' "Exploding Torpedo" was the birth of the modern-day shale fracturing industry...</p>
<p><strong><a href="http://www.wealthdaily.com/articles/coal-overseas/3889">Coal's New Life Overseas</a>: The Exiled King</strong><br />King Coal has been dethroned and is being ran out of America. However, coal still rules supreme overseas, and American miners are poised to make a fortune.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/3d-printing-brings-manufacturing-to-the-masses/2965">3D Printing Brings Manufacturing to the Masses</a>: Everyone's a Henry Ford</strong><br />I've been showing you the benefits of 3D printing for some time now. The technology has existed in its current form for about five years. And it's taking off like wildfire. So are the related stocks.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/buy-this-stock/3887">Buy This Stock</a>: This Obvious Trend Could Triple Your Money</strong><br />Should you own this stock? Heck ya! Christian DeHaemer explains why this company is a great investment for the year to come.</p>
<p><strong><a href="http://www.energyandcapital.com/articles/the-boom-and-bust-of-us-oil-investing/2968">The Boom and Bust of U.S. Oil Investing</a>: Oil Crisis Brewing in Alaska</strong><br />Keith Kohl unearths the backstory of the upcoming oil crisis brewing in Alaska's North Slope.</p>
<p><strong><a href="http://www.wealthdaily.com/articles/billionaire-says-2013-will-be-good/3884">Billionaire Says 2013 Will Be Good</a>: We Hope So!</strong><br />We can almost guarantee the market will go great guns in 2013. Let me explain by taking you back two years...</p>
<p><strong><a href="http://www.energyandcapital.com/articles/warren-buffett-bakken-shale-investment/2960">Warren Buffett Bakken Shale Investment</a>: Buy This Bakken Shale Play Now!</strong><br />An ingenious move gave Warren Buffett the keys to a company that is now the lifeblood of the oil and gas boom. And we're buying this backdoor Bakken Shale play.</p>2013-01-13T17:00:00Z2013-01-13T17:00:00Z2978Brianna PanzicaNatural Gas and Renewables Join TogetherThe director-general of the International Renewable Energy Agency and the CEO of a solar company both support natural gas use.<p>The U.S. shale gas industry has found itself backed by an unlikely supporter: the renewables industry.</p>
<p>Both domestically and internationally, champions of the renewable sector are supporting the widespread growth of natural gas usage as a complement to green power.</p>
<p>And it may sound counterproductive; natural gas, after all, is an incredibly cheap power source, creating fierce competition for more expensive solar and wind power.</p>
<p>But the International Renewable Energy Agency disagrees. Natural gas and renewables share the common enemy of coal.</p>
<p>From <em><a href="http://www.bloomberg.com/news/2013-01-10/shale-gas-boom-can-complement-renewables-to-cut-coal-irena-says.html" target="_blank">Bloomberg</a></em>:</p>
<blockquote>
<p><em>“Gas in the first instance is going to displace coal,” Adnan Amin, director-general of the agency known as IRENA, said in an interview in Abu Dhabi. “Shale gas at low cost can help to create a hybrid system,” whereby more gas-fired power is fed to the grid, supplanting coal, and augmented by wind and solar.</em></p>
</blockquote>
<p>While solar and wind power cannot supply constant power since they rely on inconsistent weather patterns, natural gas can – with half the carbon emissions of coal.</p>
<p>And carbon emissions are garnering more attention surrounding the issue of climate change. Even developing nations, with growing power needs, are working to increase reliance on low-emissions technology.</p>
<p>A joint effort between renewable power and natural gas is the way to do that.</p>
<p>Saudi Arabia, for example, has been seeing its growing power needs sap up the oil it relies on for exports. To combat that, the country plans to get a third of its power from solar by 2032 after $109 billion in investments.</p>
<p>In the U.S., natural gas utilities will have the most additions by 2015, but solar and wind will follow behind:</p>
<p><img style="vertical-align: middle; margin: 5px auto; display: block;" src="https://images.angelpub.com/2013/02/17850/utility-planned-capacity.jpg" border="0" alt="Utility Planned Capacity" /></p>
<p>IRENA is releasing a report analyzing the costs of renewable power and power from fossil fuels next week. Renewables have seen a huge drop in prices, particularly over the past year, bringing the costs closer than ever before.</p>
<p>And it's not just international organizations that are hailing the shale boom as a blessing to renewables. Right in the U.S., where the gas is abundant and cheap, some are saying exports will boost the renewable industry further.</p>
<p>One such person is Arno Harris, the CEO of solar company Recurrent Energy. Harris' view is similar to Amin's: that together, renewables and natural gas will help displace coal and make even more room for these emerging sources.</p>
<p>But he also believes that there's a next step in the process: <a href="http://www.energyandcapital.com/articles/export-natural-gas/2890">natural gas exports</a>.</p>
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<p>A recent report from the Department of Energy showed that there would be a “net economic benefit” to exporting natural gas from the U.S. That benefit, Harris believes, would also include an increase in prices that would put renewables and natural gas in even closer competition.</p>
<p>From the <em><a href="http://blog.sfgate.com/nov05election/2013/01/10/solar-chief-argues-for-natural-gas-exports/" target="_blank">SFGate</a></em>:</p>
<blockquote>
<p><em>“Everybody knows we're in this cheap gas environment,” Harris said. “Gas-fired electricity today is probably five cents or six cents per kilowatt hour, wholesale.” But new solar plants that Recurrent Energy is building will sell power to utilities as low as seven cents a kilowatt hour, he said.</em></p>
<p><em>“There's no longer this giant gap like there used to be a few years ago,” Harris said. “What Americans aren't aware of is in fact how narrow that gap gotten, just as gas is at historically low prices, wind and solar are at historically low prices as well.”</em></p>
</blockquote>
<p>Harris may have trouble getting other renewable supporters to rally behind him. Many environmentalists are still heavily opposed to natural gas production in general because of the stigma surrounding fracking.</p>
<p>But Harris is trying to change that, as is IRENA. Renewable power needs a supplement power source to provide power during downtime. Natural gas, meanwhile, is abundant and cheap. Bringing the two together has the potential to change the face of global energy.</p>
<p>That's all for now,</p>
<p><p><img style="margin: 10px; border: 0px none;" src="https://images.angelpub.com/2012/33/15729/brianna-sig-cropped.png" border="0" alt="brianna sig cropped" /></p>
<p>Brianna Panzica</p>
<p><a href="https://twitter.com/brianna_panzica" target="_blank"><img style="vertical-align: middle;" src="https://images.angelpub.com/2011/50/11971/follow-basic.jpg" border="0" alt="follow basic" />@brianna_panzica on Twitter</a></p>
<p><em><span style="color: #333333;"><a href="http://www.energyandcapital.com/" target="_blank">Energy & Capital's</a> modern energy guru, Brianna digs deep into the industry with accurate and insightful updates into the biggest energy companies and events. She stays up to date with the latest market moves and industry finds, bringing readers a unique view of current energy trends. For more on Brianna, see her editor's <a href="http://www.energyandcapital.com/editors/brianna-panzica" target="_blank">page</a>.</span></em></p></p>2013-01-11T21:33:50Z2013-01-11T21:33:50Z2983Brianna Panzica