Friday, April 28, 2017

The Energy And Market Page, T+97 -- April 28, 2017

Disclaimer: this is not an investment site. This helps me put the Bakken into perspective.

Wow, wow, wow: GDP at 0.7%. Expectations as low as 0.5% so this is not as bad as it could have been. We're okay. Market with no reaction. Dow 30 futures suggest an opening of up about 15 points. Folks are already looking at 3% GDP for the second quarter. The "Street" doesn't care about the 1Q GDP -- it's always low.

OMG: Atheanhealth is down almost 20% in pre-market trading.

Boom. From FuelFix, shale investments in the US have surged $100 billion. No signs that things will slow down. Three plays in the US are getting the bulk of this $100 billion: the Permian; the Bakken (four counties in North Dakota); and, the Eagle Ford.

Boom. GM knocks it out of the park. Easily beats estimates. Shares up 1.5% in pre-market trading. EPS $1.70 vs $1.48 forecast. Also beat on revenues. Tops estimates for 8th straight quarter.

Surprise: ExxonMobil EPS 95 cents vs 86 cents forecast; missed on revenues and took loss on upstream. But the bean counters managed to surprise analysts at the end of the day: earnings per share. The guys working in the back room deserve a huge raise in pay. Good for them.

No repeat of the DAPL (link at FuelFix): Trans-Pecos Pipeline ready; protest camp to close. See more of this story at this post

Apple wins: Qualcomm says it will no longer get any royalty payments from Apple for iPhone technology. Complicated story. But Qualcomm's announcement seems pretty straightforward.

Headlines from Rigzone today:
  • OPEC wants further drop in oil stocks; is working for consensus
  • OPEC ministers to meet Russia amid push to extend cuts
  • France's Total approves first major project since 2014 as profits surge
  • OPEC wants US to join production cut deal; dream on, OPEC -- the US will never act like a cartel
  • France's Total will invest $500  million to produce shale gas in Argentina
  • world's two biggest shipbuilders signal more orders as earnings improve

PJM And Wind

Link here at Bloomberg: story developing. We will know more next month after PJM's capacity auction.

When the story comes out next week, the story will be 23 paragraphs long with a huge headline that "wind wins again."

One will have to get to the 21st paragraph to read the following:
Payments from capacity auctions are sought after by owners of nuclear and natural-gas fired plants and other resources in an era of lower power prices. Bidders have to ensure they can supply energy at any time of the year or risk paying hefty penalties under a rule designed to head off a repeat of the 2014 polar vortex, when a cold snap led to fuel shortages, forcing some plants to shut.  
In last year’s auction, the amount of wind resources selected rose to 969 megawatts from 857 megawatts, according to PJM. That represents just 13 percent of the total wind capacity available on the grid, and 0.6 percent of the total purchased at the auction.
While its role in the capacity market has been limited, wind has been playing a bigger one in the spot market. Its capacity on the grid jumped to 7,655 megawatts last year and has more than doubled in the past seven years, data from the Valley Forge, Pennsylvania-based grid operator show.
0.6 percent the total energy purchased at the auction. Wow.

And the writer fails to say how much that trivial amount is costing its customers.

Let's see if Bloomberg provides the percent that wind energy adds to overall energy purchased at next month's auction. My hunch: we won't see it.

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