Launching my new Aussie oil and gas blog

Commodity Prices

The oil price spread between WTI and Brent continues to widen and on percentage terms is as high as I can ever remember it.  No doubt K Street lobbyists are pointing this out in the corridors of Congress – but would the Presidential veto pen hover over any Republican sourced legislation to repeal the US (strictly speaking the Lower 48) crude oil export ban?

Meanwhile, gas prices in the US seem to be immune from the New England/Mid-West cold weather that we have been seeing on our TV screens.  What would those prices be like if Southern New York State did secede and joined their frack-friendly Marcellus friends, as recently was reported as under consideration in the Economist?

LNG

Speaking of spreads, the natural order in the LNG world has been restored with Asia trading higher than Europe.  Phew!

Politics

I note that the Victorian Parliament is joining the band of brave Australian politicians who are facing the hot issue of community concerns about fracking versus the looming gas supply shortfall – by conducting an enquiry.  There is a real sense of urgency indicated by the mid 2016 reporting timeframe.  Sir Humphrey would be proud.

Company news

Santos

Post market closing yesterday, Santos put out a somewhat baffling ASX announcement about the “retirement” of its Chairman Ken Borda and his replacement by his predecessor.  The AFR reported a strong difference of opinion between Borda and his MD, David Knox.  What is surprising to me is that when Chairmen and MDs disagree, at a time when a company has just lost ~$7B in market cap over a few months, it is normally the MD who goes!

No doubt this story will run and run.  Its most interesting outcome would be that the dispute was over something as material as a merger or takeover approach……

Beach Energy

Someone with real money has joined the other substantial shareholders, Messrs Stokes and Packer, over at Beach – the Bank of Norway.  I however doubt it will have eyes on Board seats as I suspect Seven does.  Also at Beach, Reg Nelson spoke in a media interview about the many buying opportunities facing a company like Beach at a time like this.  Light lies the removal of the crown!

The Business Spectator noted today that KKR were supposedly looking at Cooper Basin buying opportunities.  My own view is that bigger, less risky, more leverage-able deals will be available to the Barbarians back in the good old US of A.

Maverick Drilling

The ASX might be winding up its speeding ticket dispenser to give MAD a ticket later today.  Is this the sign that Chuck Yeager and his merry men are going to announce the long awaited acquisition deal that MAD shareholders have been waiting for for some time?

LNG Ltd

LNG announced today it will likely list on a US exchange.  Nothing particularly firm was said in the announcement.  This company’s share price has performed exceptionally well in recent times, and US market interest could well be piqued by the upcoming commencement of exports by Cheniere later this year.

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