RE:Ferndale -- undervalued Hidden Jewel?Probably dreaming but interesting info.
What we need from Petrogas is:Numbers
We have had an indication from Randy at the time of the deal to buy an additional 37% to own a total of 74% .
The only on thing about Petrogas possible EBITDA is :
«
Petrogas is one of the largest privately held mid-stream and logistics companies in North America with operations dating back to 1986. The company operates a large-scale fully integrated natural gas liquids (NGLs) and crude oil platform that provides sourcing, storage, marketing and transportation services of NGLs and LPGs for customers throughout Canada, the United States and Asia, and crude oil throughout Canada and the U.S.» -«
Assuming reasonable LPG exports from Ferndale in 2021, the current forward curves and other logical assumptions, coupled with Petrogas's fixed fee-based contracts, Petrogas is expected to earn an estimated $185-million of normalized EBITDA in 2021, prior to operational synergies. In addition, by optimizing the marketing contract portfolios and logistics, together with supply chain efficiencies and potential cost savings, AltaGas also estimates there to be an opportunity for approximately $30-million of annual synergies, which the company will plan to take steps to substantially achieve in the first year and be fully realizing these on a run-rate basis at the end of 2021.» We probably have more info at the time of the publication of the ALA FR at the end of February.
rfguysd wrote: The basics are understood:
1. Export license for 40k bbl/day.
2. About 5k/10k bbl /day Butane is export. Butane comes for the Philips66 and BP refinery via pipeline . Both refineries are located within a walking distance of Petrogas.
3. Amount of Propane exported from Ferndale is not disclosed. Only a quarterly dividend is provided by Petrogas to Altagas.
4. Ferndale is closer to Edmonton by rail (700mi) than Prince Rupert to Edmonton by rail(900mi).
5. Petrogas has a wharf that is capable of VLGC .
6. In 2016, Petrogas purchased the wharf from Intalco . Petrogas allowed Intalco (primary) full use of the Wharf. As well as the wharf purchased, Intalco sold parcels of land to Petrogas surrounding the Wharf. Other information is not disclosed.
7. April 2020 –Alcoa Intalco plans smelter closure in Ferndale for late summer 2020. In late September over 700 workers at Intalco have been let-go. Company officials blame cheap aluminium Canadian imports for the closure.
8. Smelter has been idled. Petrogas owns lands about the wharf and adjacent to smelter yards.
9. Jan 2020 Petrogas exercises the right to sell Petrogas to its Partners Altagas and Idemitsu. (I must congratulate Sam on the job running Petrogas…..well done).
Don’t be short-sighted here. Taking a longer view , with partners Vopak/Idemitsu it would not surprise me to see a much bigger /much stonger Ferndale export terminal. What stopped Petrogas… is money --access to capital….just too small to do it without partners. I would not be too surprise to see a bigger partnership at Ferndale with its current partners to upgrade/facelift the facilities at Ferndale in the not too distance future.
Well , what is there to stop ALTAGAS to expand Ferndale? People in Ferndale just lost a 700 job smelter. Regulatory….hard to argue that a LNG/LPG export terminal is worse the smelter. Land claim issues……Petrogas owns land around the wharf. Congestion and Blockage on CN tracks bottlenecks freight. I don’t think that happens in Ferndale. Multiple entries into Ferndale. Oh….. don’t forget 2 existing oil refineries nearby.
I am dreaming? GLTA
RFguy.