Notes From All Over -- Catching Up -- Part 2 -- July 2, 2021

Texas freeze hangover: could spoil California's summer. Link here. Interesting story. This helps answer the question I had regarding the California heat wave which I wrote about on June 29, 2021, just a couple of days ago. 

That post began:

Link here.

• Spot gas prices in Southern California surged 8% today to $7.08/MMBtu as the region turned to gas-fired generation to cope with the ongoing heatwave while power imports dropped.
• Relevant tickers include SRE, EIX, PCG
• California ISO's thermal power demand has spiked in the days since the start of the West Coast heat wave, with generation ramping up 58% to 331 GWh on June 28 from 210 GWh on June 26, 2021.
• Yet even as total power demand rose, power imports into the state fell 36% to 85 GWh on June 28 from 133 GWh on June 26.
• The National Weather Service forecasts the upper-level high-pressure system responsible for the heat wave could weaken by July 1.

Now, more, from the link above.  

This is pretty amazing (as you read the article, think about the amount of pressure EVs would put on the grid). 

A drought threatens California's hydroelectric power, and now its natural gas backup is also running low. 

This all comes from an original op-ed in Bloomberg. Or here, perhaps without a paywall.

California’s hydropower reserves are drying up in the most literal sense. 

This summer, however, the fuel that normally stands in for water is also running lower than usual. 

Natural gas typically fulfills two roles for California’s power grid during a hot, dry summer. 

First, it fills in the gap left by depleted hydropower. Second, it handles much of the state’s surge in electricity demand during the early evening, when solar power fades; especially important if that surge is powering a lot of air-conditioning [and when folks return home from work, plugging in their EVs]. 

California’s gas market is twitchy. 

PG&E Corp.’s recent announcement of maintenance on a key pipeline through the end of June caused the premium on local gas supplies to jump to its highest level since February. 

It didn’t help that, around the same time, power stations in California and Nevada were suddenly burning double the amount of gas compared to the previous month as a heatwave washed over the West. 

PG&E had also just reclassified about 50 billion cubic feet of its gas inventory as "base" gas -- which stays in the tank to maintain pressure -- from the "working" gas that can actually be drawn upon to meet demand.  

Net net, it looks like California may be entering the height of a particularly demanding summer with the lowest stockpile of gas in more than decade.

One reason for this concerns prior events in another state some way, geographically and philosophically, from Sacramento: Texas. California produces very little gas of its own, relying on imports from the Rockies, Canada (via the Pacific Northwest) and Texas (via the desert Southwest). A little of that gas then usually heads south out of California to Mexico. 

Most readers can connect the dots from there, but if not, it's all made clear at the linked article.

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For Investors

Dividends: if one wants to see a long list of dividend-paying companies highlighted by Kiplinger Today, here's one link. It's a SeekingAlpha link so the article will disappear behind a paywall shortly. 

AMD set to dominate: due to Intel's ongoing delays. Previously posted through a different source. This, too, is a SeekingAlpha link so the article will disappear behind a paywall shortly. 

US ethane exports: April, 2021, US ethane exports rose to a record in April, 2021, supported by expanded export infrastructure, surpassing the high set in the prior month (March, 2021).

Exports rose 9 percent from March, 2021, and a 45 percent increase from April, 2020. Energy Transfer's 180,000 b/d Orbit ethane export terminal in Nederland, Texas, came on line at the beginning of the year. The facility is the third ethane export terminal in the county. 

Brent: a subject often discussed on the blog. Now, this from Gerald Jansen. A huge story; needs to be posted as a stand-alone post. 

Surprised? Still one of my favorite tweets. Link here. WTI at $75.01 today (July 2, 2021).

Oil rally. Link to Tsvetana Paraskova. Forty percent rally puts oil prices on track for best first half since 2009. That's more than a decade of suffering for oil bulls. LOL.