Q3 Summary: Items worthy of discussions? 1)Seasonal Trading. Several posters have mention that ALA has a seasonal stock price component. What triggers the end of the seasonal trade? Heating days going positive indicating the WGL customers using natural gas? US injection of natural gas into storage coming to an end –late OCT? Release of the Q3 numbers late Oct---Q3 being the worst performing qtr?
2)PPL plans to expand Watson Island to include Butane exports and deepen water channel to include VLGC’s so exports can increase. This surely means a positive of Propane /Butane exports.
3)China orders energy companies to stock up for the winter. China relaxes CO2 emissions so that coal plants can produce excess electricity to meet winter demand. Good for propane exports .
4)FEI propane prices never dipped in the summer due to lack of demand. From $544/tonne in Feb to $910/tonne in OCT. This correlates with the Chinese order to ensure winter demand is met.
5)Natural gas injection in the US remains below 5yr average. Several posters noted the high Nat Gas price but what is important to ALTAGAS is, “How much gas is processed by the their facilities?”. ALTAGAS is paid by the mcf to gather, process and transport natural gas to market. I would expect similar numbers to Q2 which was very good given that summer is a slow period due to lower demand.
6)Lack of Federal decisions regarding VOPAK Tank farm on Ridley Island. There is a strong relationship between ALTAGAS and Vopak. Expansion of RIPET will be included in the VOPAK proposals. Sharing of Storage tanks and wharfs . Once again , the federal government is late. I would just cancel this project and look at development in Ferndale.
7) Purchase of InTalco’s land at Ferndale. Why bother? I’ve always said look for Ferndale to expand. What a gold mine? One of the few export terminals on the west coast that is underutilized. Management has already mentioned increasing rail facilities there……low hanging fruit. I would look bigger at a much larger expansion that will include “green gas”, increased storage.
8)WGL signs agreement with RNG firms to distribute gas to customers. This is the start of reducing GHGs to the WGL customers. More agreements were forthcoming but we know how ALA is going to proceed . It has started.
9)PennEast pipeline proposal has been cancelled. Years of fighting … developers throw in the towel. What does this mean for MVP? If Crawford could sell ALA’s stake in the pipeline …he would in a second. But no one wants it due to the regulatory mess that has been created by government officials and opponents. I expect a writedown of investment here…since the pipeline is unlikely to be built or sold. (my guess). I also expect that this cancellation of the pipeline will help keep NAT gas prices high.
10)In the Q2 Altagas NR … LPGs exports where sited as 90,106barrels/day. There were 91 days in the quarter so 91 x 90,106 barrels/day = 8.2M barrels /Qtr. Why is it that we report 7.8M barrels by adding up vessel volumes on RIPET and FERNDALE? What is missing?
11)What I like (which is the exact opposite of green companies ..npi,aqn, etc is that ALA has not diluted the shares. ALTAgas has kept its word.
There is only a general direction for SP . I am not surprised by analysts targets.
GLTA
RFguy