The company's utility group expects to grow its rate base
approximately 7 percent annually over the next five years on a compound
basis. This growth projection is on a much larger base, having grown
rate base at a record pace of 10 percent compounded annually over the
past five-year period. Although the company has assumed slower growth in
the Bakken region of North Dakota, the
utility group is spread across eight states where customer growth is
expected to be higher than the national average. This customer growth
along with system upgrades and replacements needed to supply safe and
reliable service will require investments in new electric generation and
transmission and electric and natural gas distribution. In addition,
while the company is among the lowest-priced power providers in the
country, the EPA's recently published Clean Power Plan could require
additional investment that would be incremental to the company's
five-year capital expenditures forecast.
The capital investment program at the pipeline and energy services
business reflects organic growth projects and includes a pipeline
project to serve eastern North Dakota
later in the five-year timeframe. The group is focused on improving
existing operations and accelerating growth in its current markets while
evaluating expansion into other basins. Potential acquisitions would be
incremental to the five-year capital investment program. Capital
expenditures pertaining to a second refinery have been removed from the
forecast as the company focuses on optimizing its current refinery
investment.
At the company's construction businesses, the capital expenditures
forecast is focused primarily on organic expansion opportunities. In
addition, operating leases for equipment upgrades are being utilized and
supplement the capital program. The group continues to evaluate
opportunities for merger and acquisition growth. While acquisition
capital was included in last year's capital forecast, the new forecast
does not include potential acquisitions, but rather any acquisitions
would be in addition to the projected capital investments. The
construction materials business has momentum with improving markets and a
lower cost structure, and adjusted earnings are 80 percent higher
year-to-date from a year ago.
Regular readers know my opinion on the US Strategic Petroleum Reserve: no longer necessary. I just posted that over the weekend again, time to sell off the US SPR.
It's interesting to read the comments. My knee-jerk reaction was to agree with Tim: the tablet and the laptop (or the tablet and the PC) are two different animals, and trying to merge them into one will result in a less satisfying experience.
I am sitting here, working on my MacBook Air, doing things I cannot do on an iPad (certainly not easily). My workhorse is the MacBook Air. But I do occasionally use my iPad but not very much any more.
However, if I could have this very same MacBook Air experience, and then when I'm done, and ready to go out for coffee, and just remove the "monitor" -- i.e., the tablet, that would be awesome. Most folks know that Apple users can partition their Apple computers to run on Apple OS as well as on a PC operating system. There should be no reason that when the monitor is attached to the MacBook Air keyboard it runs the standard Apple Mac OS, but when the monitor comes off, it flips to Apple mobile OS.
Imagine how much more capability the complete system would have. One would have battery power in the monitor (the tablet) as well as in the MacBook Air keyboard. There would be memory in each half -- both RAM and flash.
My hunch is that Apple engineers are already working this issue, and some day we will have a tablet that remains a 100% tablet when standing along, but then becomes a simple monitor when plugged into the MacBook Air keyboard.
Permian Basin crude production more than doubled since 2011 to reach
nearly 2 MMb/d today, but that rate of increase has leveled off since
prices crashed last year. Meantime 750Mb/d of long-haul pipeline
takeaway capacity came online in the first half of 2015 - greatly
exceeding today’s take-away requirements. And there is more to come next
year when the 470 Mb/d Enterprise Midland-to-Sealy pipeline is expected
online – leading to fears regional pipeline infrastructure is
overbuilt. How about inside the Permian Basin? Today we start a series
reviewing Permian gathering system build out.
We recently looked at changing differentials between prices for
Permian West Texas Intermediate (WTI) crude at the Midland, TX gathering
hub close to producing areas and WTI prices at Cushing, OK the Midwest
crude trading and storage hub.
In theory – if there is no congestion on pipelines between Midland and
Cushing, the crude price differential between the two points (Cushing
minus Midland) should equal the cost of transportation or less than
$1/Bbl (depending on shipper commitments). And that is the way the
differential traded for years before Permian crude production took off
in 2011 after producers applied shale drilling technologies in the
basin. Since then crude output in the region has more than doubled –
reaching close to 2 MMb/d in July 2015 according to the Energy
Information Administration (EIA) drilling productivity report.
Increasing production put pressure on crude takeaway capacity from the
region as midstream companies scrambled to keep up with soaring output.
When production exceeded takeaway capacity, producers had to accept
discounted prices to get their barrels onto busy pipelines – causing
prices at Midland to dip well below Cushing. Then as new pipelines came
online the pressure was relieved and the differential narrowed. Over the
summer we saw Midland prices at a rare premium to Cushing when a spate
of new pipelines came online together creating the opposite of
congestion – a shortage of crude - when shippers could not source enough
barrels to meet their commitments to the new pipelines and bid up the
price at Midland above Cushing. In the last month that situation has
reversed again as refinery maintenance in the Permian Basin has freed up
barrels at Midland. Between October 2, 2015 and last Friday (November
13, 2015) WTI Midland once again traded under Cushing – by an average of
$0.57/Bbl.
*********************************
Glut of Coal-Fired Plants Casts Doubt on China's Energy Priorities -- New York Times
Just outside the southwest border of Beijing, a new coal-fired power
and heating plant is rising in Dongxianpo, a rural town in Hebei
Province. Cement mixers roll onto the site. Cranes tower above a
landscape of metal girders.
When finished, the plant, run by a company owned
by the Beijing government, is expected to have a generating capacity of
700 megawatts of power, more than the total of similar plants in Ohio.
But whether it will actually be used to its fullest is questionable,
despite the investment of $580 million.
That
is because the plant is scheduled to come online in three years amid a
glut of coal-fired power plants — an astounding 155 planned projects
received a permit this year alone, with total capacity equal to nearly
40 percent of operational coal power plants in the United States.
China’s economic slowdown and the government’s pledges to use more renewable and nuclear energy
make some of the country’s existing plants and most or all of the 155
new ones unnecessary, according to interviews with officials and
scholars, a review of public statistics and a report released Wednesday about the “coal power bubble” by Greenpeace East Asia. There are already too many plants, as shown by a steady decline in the plants’ average operating hours since 2013.
The construction boom — with capital costs estimated by Greenpeace
at $74 billion — is a clear sign that China remains entrenched in
investment-driven growth, despite promises by leaders to transform the
economic model to one based on consumer spending.
It
also raises questions about whether China is weaning itself from coal
as quickly as it can and whether officials are sufficiently supporting
nonfossil fuel sources over coal, which is championed by some
state-owned enterprises. China is the biggest emitter of greenhouse
gases in the world and the main driver of climate change, and it has some of the worst air pollution.
Conflict
within the system is rising. Renewable-energy interests — wind, solar
and hydropower — are pushing back against coal-fired power plants, which
have 40-year life spans. They say the rising number of coal plants
prevents other energy sources from selling electricity on the grid and
attracting more investment. They want the government to move faster with
its promised “green dispatch,” giving priority to low-carbon
electricity sources.
By the way, this allows China to come up with huge reductions of carbon emissions in the out-years -- all fake numbers, of course. If they define the baseline as the "potential" CO2 emission of all these coal plants -- built or not built -- and then measure "actual" CO2 emissions, the delta will be so big, China will have bragging rights to the largest decrease in CO2 emissions in the entire universe.
