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Hey Bob...did your tipster give you any insight to what this PR might be about?
Is Natural Gas the Answer To Energy Needs of US?
Monday August 4, 1:32 pm ET
Are we entering the golden age of natural gas?
That's the case being made by Chesapeake Energy (NYSE:CHK - News) CEO Aubrey McClendon, who recently sang the virtues of natural gas before Congress: It’s cheaper and cleaner than other fossil fuels, and available in vast quantities right in the US.
"Imagine if tomorrow you could announce a new energy plan that would in one stroke cut your constituent’s gasoline bill in half, reduce oil imports, improve our air quality, enhance national security, strengthen the dollar, reduce greenhouse gas emission and create tens of thousands of new jobs in the US,” McClendon told Congress last week.
All you have to do is encourage the use of natural gas (in compressed form, known as CNG) for transportation, he said.
"It's a trifecta, triple play and hat trick all rolled into one," he added. "It's actually very easy."| Watch his interview on CNBC below.
It's an idea getting traction in Congress, which is considering legislation to encourage automakers to build vehicles that can run on compressed natural gas (CNG).
Texas oil tycoon Boone Pickens is also pushing greater use of wind and natural gas to slash the nation's huge oil-import bill. Watch his interview on CNBC below.
But not everyone sees natural gas as the answer to US energy needs.
A Dow Chemical (NYSE:DOW - News) executive told Congress last week that encouraging greater use of natural gas could push up prices for consumers and manufacturers that already use natural gas, pressuring some to relocate overseas. Natural gas also is gaining greater favor with electricity providers, which could boost demand—and prices—even more.
“Congress has been enticed into over-reliance on natural gas before,” cautioned Rich Wells, energy VP, for Dow, which has seen its energy and petroleum-based feedstock costs rise 42 percent in the first three months of 2008.
Other critics also question a recent Chesapeake-funded research report that asserted the US has nearly 50 percent more gas resources (dfferent from reserves) than previous estimates.
That's a fuzzy claim, say experts, such as Bobl Tippee, Oil & Gas Journal editor, a 30-year industry veteran, who notes “resource numbers are even more ambiguous” than reserves, which themselves are “very imprecise.”
Making the Switch Difficult
Still, natural gas is getting more attention now that crude oil prices are at historic highs. The question is whether a transportation system long-dependent on gasoline and diesel can make the switch.
Technology is not an issue. In fact, General Motors (NYSE:BGM - News) already makes 18 models of cars and trucks that use compressed natural gas (CNG), just not in the US.
In other countries, GM is either required or encouraged to build these CNG vehicles, while today's high oil prices now seem to make building these same vehicles here a sensible option.
Congress is trying to encourage the switch. One bill, introduced last week, aims at making 10 percent of Detroit's output CNG-compatible by 2018.
It offers $90,000 tax credit to get 20,000 gas stations owners to add CNG pumps, to overcome a critical infrastructural gap that has stymied earlier moves to favor CNG.|
So far, only Honda (NYSE:HMC - News) offers a CNG vehicle in the US.
It's Civic GX which has been the greenest car in the country practically since it was introduced in 1997. (A $25,000 price tag is trimmed by a $4,000 federal tax incentive.)
It may also be one of the cheapest cars to operate. With a home fueling unit, the Civic GX can be filled up at $1-1.50 per gallon equivalent, according to John German, American Honda’s environment and energy analysis manager.
Little wonder the stock of CNG-compatible cars is growing worldwide. Currently just one percent of the global vehicle stock, they make up 24 percent of vehicles in Argentina.
Natural Gas Prized by Power Sector
But this new demand from the transportation sector, overlaps—and possibly conflicts—with its growing popularity for electricity generation.
Roughly one-third of US gas consumption goes to generate power and that is projected to keep growing. (Gas produced one per cent of New England’s power in 1980; now it supplies more than 40 percent.)
That’s driving growing imports of liquidified natural gas (LNG),| currently just three percent of total gas use (the rest is from North America) but soon expected to rise to 20 percent.
That’s why boosting domestic gas production is critical, argues McClendon, especially fast growing unconventional sources, which has soared 65 percent in the last decade.
Tapping these sources comes from new technologies, including improved horizontal drilling. (One example: gas is now being sucked from underneath Dallas-Fort Worth’s airport and “the drilling rigs.... are headed toward downtown," says the Department of Energy.)
John Felmy, chief economist of the American Petroleum Institute, says the Chesapeake study usefully highlights the importance of opening up more roughly 80 percent of US territory – both on and off-shore – that is closed to exploration.
But McClendon acknowledges current gang-buster unconventional gas production, should keep supply growing five percent a year for the next decade - even without opening up more public land.
Crowding Out Gas-Dependent Industry
McClendon says the US could convert 10 percent of our vehicle fleet to CNG within eight years, and only increase overall natural gas consumption by one percent.
Dow Chemicals’ Wells is not so sure about that, and he questions the even more fundamental| assumption that gas will always be cheaper than oil.
He notes they were at rough parity between January 2003 and December 2005 and that gas prices were far more volatile than oil.
Increased demand will also ratchet up gas prices for both residential and business users, particularly harming industries dependent on gas for energy and feedstocks, such as chemicals and plastics, he says.
Rising prices are already taking a toll on US-based business. Foreign-sourced natural gas is far cheaper than US-produced gas - even LNG imports are two times cheaper $4-4.50 vs average US price of $10) - putting US industry at a significant disadvantage, noted Wells.
The spike in gas prices since 2001 has forced many US companies with “global market share ambitions” to relocate overseas, a trend he said would only accelerate with Pickens (and Chesapeake’s) plan, according to Wells.
“We want to invest in the US, but there must be an appropriate value proposition,” he said, noting Dow’s 2002 US sales outstripped those Germany (its second largest market), by more than six to one.
Today more than two-thirds of Dow’s total sales are generated outside
Pass it on to whoever you want. Everybody is getting a lawyer and talking to authorities...BS. You all have made up personas and are trader wannabees. If the thing went up nobody would give a rats ass how or why, scam or legit...but since it went way down you guys are crying and whining like babies. You should of thought about the possible losses before you took money from your mommies purse to buy your shares.
So even if smith and others are dumping now....what are they making? 30k, 40k.....oh yeah going to jail is worth that amount.
Smith is doing everything possible to keep this company alive until Mexico gets their act together or something happens in California.
With the PPS being so low it is a daytraders and MM dream. Huge blocks worth little value are being bought and sold. It would take another company years to obtain the permits in Texas and Mexico that Tide alreaady has and apply for the storage in Mexico. These permits alone will be worth something when the storage is settled.
For those who complain because the company sold off the propane business (the one money maker!). Tide sold it off to pay off debt. Nobody bought stock in Tide because of the propane business. We all bought stock because of the potential in Mexico and then California.
Management is selling stock to keep this thing alive and survive.
The price is down and there is more risk involved than anybody cares to tolerate but this is not a scam, it is not a hoax. Read the FERC filings and CRE permits. These things cost millions to obtain and thousands of hours of work to put together. Companies don't put in that effort and go through permitting processes with 2 govt's just for the hell of it.
Tidelands Oil & Gas Corporation Provides Update On Burgos Hub Project
Last update: 9:25 a.m. EDT July 28, 2008
SAN ANTONIO, July 28, 2008 /PRNewswire-FirstCall via COMTEX/ -- Tidelands Oil & Gas Corporation (TIDE:tidelands oil & gas corp com
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3:46pm 07/25/2008
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TIDE 0.01, 0.00, -33.3%) , would like to provide our shareholders and the investment community with an update concerning the status of activities within Frontera Pipeline LLC ("Frontera") and the Burgos Hub project in South Texas and Northern Mexico.
On May 21, 2008, the Federal Energy Regulatory Commission (FERC) granted an extension of time until and including July 10, 2010 for Sonora Pipeline LLC to construct and make its Burgos Hub project facilities available for service. The certificate of convenience and public necessity for the construction of the natural gas pipeline and the permit to extend the pipeline under the Rio Grande River for interconnection into natural gas pipelines in Mexico are key entitlements that are expected to be used to attract commercial development of the project. The extension of time granted by FERC was given in order to accommodate expected commercial use of the facilities by parties based in Mexico. Sonora Pipeline LLC is wholly owned by Frontera Pipeline LLC. Tidelands Oil & Gas Corporation owns 20% of Frontera.
On May 29, 2008, the Comision Reguladora de Energia (CRE) granted a one year extension from that date for Terranova Energia, S. de R.L. de C.V. ("Terranova") to file its final cost and income proposal, as well as the corresponding tariffs and maximum income for the existing natural gas pipeline permit held by Terranova in Mexico. The current expectation of Frontera is that no change of the existing pipeline routing under the original permit is needed at this time; therefore, Frontera does not expect to file for an amendment to the existing pipeline permit. Terranova is also wholly owned by Frontera.
Frontera expects that more clarity concerning the status of the natural gas storage facility (a component of the Burgos Hub project) permit application will emerge from the results of the energy reform legislation which is currently under debate and consideration by the Mexican legislature. The CRE has informed Frontera that there is a specific provision in the energy reform proposals put forth by the Calderon administration that deals with the development of natural gas storage facilities in depleted gas reservoirs that are owned by PEMEX and the Mexican nation.
James B. Smith, Tidelands' President and CEO, said, "Based on discussions with our partners in Frontera and with representatives of PEMEX, our current expectation for future commercial use of the proposed facilities is that one or more subsidiaries of PEMEX is likely to be the principal customer for some portion of the Burgos Hub project."
Jim Smith is back from Mexico. He met his goal for the trip and received some support. Did not receive permit during trip but things are moving along. He traveled with Fronterra staff.
Did you guys read the 10K? Obviously not.
Stated clearly
"ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
Pursuant to Mr. Smith’s employment agreement, he was issued 3,571,429 shares of the Company’s common stock valued at $250,000 as of March 31, 2008. Pursuant to Mr. Karim’s consulting agreement, he was issued 3,571,429 shares of the Company’s common stock valued at $250,000 as of March 31, 2008. Pursuant to Mr. Hessel’s consulting agreement, he was issued 3,571,429 shares of the Company’s common stock valued at $250,000 as of March 31, 2008
Jim Smith is on his way to Mexico today to meet with CRE.
In the past Impact has never been a big seller of their Tide stock even when they held less than 10%. Impact own more that 10% of the issued stock in Tidelands. The SEC prohibits them (because of their relationshipe with TIDE) from selling more than 1% of the issued and outstanding stock every 90 days. Impact didn’t make the deal so they can start dumping the stock..........ACCUMULATE!!!
A little off with news on permit in March but Smith and Cheniere did have meeting in March (original sentiment was that the permit was going to be awarded during meeting). Recent activety due to Beacon Research (lot of info in report) and pending 8k. As I posted....accumulate!!!
Wowsa - What was the exact question you asked? The only comments he made about his own company is "the zero-emissions design of the Port Esperanza project, which favors its success in the permit process." I have not heard much about Port Esperanza. This would indicate they are still in the game. FYI, Smith and Cheniere are on their way to Mexico to discuss permit. Also, a financing deal will happen soon.
The storage permit is on track to be approved in March. Tidelands and Cheniere will lease the storage facility from Pemex. This leasing arrangement was discussed by Smith in an investors conference call last year. Basically the storage permit will be awarded but Tidelands+Cheniere will not own or purchase the storage facility. It will be leased from PEMEX. Announcement and contruction of pipelines will follow these events.
Ants-within the 4 to 6 weeks.
Accumulate!
The filing is not bad news and does not indicate accounting turmoil. It actually came out yesterday but was just posted on the bd today. I highly doubt anyone sold because of it. It's just business. Companies change vendors all the time. Only difference is when you are publicly traded you have to report these things.
Things will get better. Smith has been communicating with investors. He has communicated financing, something big and "don't mistake silence for lack of activety".
There is someone on this bd who is going to post this on Raging Bull. This time, don't take the credit like you did with the Sonterra news.
Probably not today. It will happen within days. Don't kill me because I am off by a day or 2 or 3.
You won't find anything. News will come out tomorrow.
Sonterra Energy was sold to Mike Ward. Remember, he had first right of refusal(part of seperation agreement). So Jim had to offer it to him first. The deal will be closed today and announced tomorrow. Also, the Eagle Pass pipeline will be sold to a company called West Texas Gas Inc.
This is all to payoff Palisades and get them out of the way. This is a good thing. Cheniere has been involved and is advising Tidelands to selloff to payoff and focus on the burgos-hub piepline and storage project.