12.08.16. - Every Friday, Seeking Alpha provides a roundup of insightful opinion and analysis articles in the energy sector.
Energy Sector Bankruptcies for the Week Ended Aug. 12, 2016
Here's a list of the most recent bankruptcy announcements in the energy sector:
- None this week.
U.S. Oil Rig Count as of Aug. 12, 2016
As per Baker Hughes, the number of active U.S. oil drilling rigs rose for the seventh straight week.
Quand une lettre pour investisseurs se réjouit de n'avoir aucune faillite à annoncer pour la semaine!
Quand cette même lettre annonce fièrement que le nombre de foreuses en activité est en augmentation depuis 7 semaines.
Certes, mais le tableau publié montre aussi que l'année dernière pour la même semaine, il y avait 843 foreuses en activité sur le sol américain. Il y en a aujourd'hui 461.
08.08.16. - Government says payments, capped at £10m for communities near wells, will not be made until site is up and running.
The government has admitted that payments of up to £10,000 a household for living near a fracking well would not be distributed until a new site begins operating and producing gas – at least five years after exploration begins.
In a consultation on the shale wealth fund published on Monday, officials said that payments would be capped at £10m for each community living near a well, over its lifetime. They also conceded that any money flowing directly to households would not happen until a full-scale fracking industry is up and running.
At the weekend, Theresa May announced a modification of George Osborne’s plans to use part of the tax take from fracking to distribute to communities affected, a move that has been dismissed by environmentalists as a bribe to dampen community opposition to the technology.
May’s changes would mean that private households could benefit financially as well as local authorities. She said: “As I said on my first night as prime minister: when we take the big calls, we’ll think not of the powerful but of you. This announcement is an example of putting those principles into action. It’s about making sure people personally benefit from economic decisions that are taken – not just councils – and putting them back in control over their lives.”
According to the consultation document, the payments “will be funded from tax revenues from sites developed for gas production and so it is likely to come later than the first community benefits funding provided by the industry, which will begin when the first exploration wells are drilled to test the flow of gas”.
Only one exploratory shale gas well has been fracked in the UK, in 2011. The former chairman of Cuadrilla, one of Britain’s leading shale companies, has said previously that it would take at least five years of exploration – drilling and testing gas flows – before production at scale.
That suggests any such payments are unlikely to be paid to individuals before the early 2020s. Currently, only one shale gas well has planning approval for fracking, at the village of Kirby Misperton in North Yorkshire. “Exploratory activity is still at an early stage in the UK,” the consultation admits.
The shale wealth fund plan will be funded by 10% of tax revenues from shale gas production. The amount each well is expected to provide in tax revenue will vary from place to place, meaning some households will get less than others.
Tax revenues are driven by profitability; the profitability of any site is dependent on fuel prices, operator costs and site-specific geology,” the government says.
The consultation also says that the government does not yet know how to define a catchment area around a shale development for compensation, or which body should have the authority locally to help dispense the money from the wealth fund.
On Sunday, Barry Gardiner, the shadow energy and climate change secretary, criticised the handouts for fracking developments when there was no such incentive for people to accept clean-energy windfarms.
“Does Theresa May really hold the British public in such high esteem that she thinks they can be bribed into fracking and a fossil fuel future?” he said.
Premières réactions après la proposition de Theresa May de verser directement aux foyers britanniques une partie des taxes payées par les pétroliers sur l'extraction du gaz de schiste.
07.08.16. - Planned changes mean individual households could receive between £5,000 and £20,000
Theresa May has been accused of trying to bribe and silence the public into accepting fracking.
Individual households will be given cash payments potentially running into thousands of pounds in recompense for fracking in their area, under new plans announced by the Prime Minister.
A £1bn shale wealth fund unveiled by former chancellor George Osborne in November will set aside up to 10 per cent of the tax proceeds from fracking to benefit the communities hosting wells.
But now the Prime Minister is amending the scheme so the money can go direct to residents rather than being given to councils or community trusts to spend, as Mr Osborne planned.
It is expected that the new fund could deliver as much as £10m to each community where wells are sited. Downing Street declined to estimate how much pay-outs could be worth, but it is thought that individual households could receive between £5,000 and £20,000.
The change could go some way to countering resident resistance to fracking, but has been branded by critics as a “bribe” to householders which could divert cash away from community priorities like infrastructure or skills training.
Green Party MEP Molly Scott Cato said the proposed payments to individual households amounted to "little more than bribes".
"This is bound to set household against household and can only exacerbate community tensions," said Ms Scott Cato, who pointed to a recent poll suggesting just 19 per cent of people in the UK support fracking.
People's concerns about climate change and their local environment cannot be silenced with a wad of cash.
"You can't put a price on the quality of the air you breathe, the water you drink, and the beauty of our countryside."
“As I said on my first night as Prime Minister: when we take the big calls, we'll think not of the powerful but of you.
“This announcement is an example of putting those principles into action. It's about making sure people personally benefit from economic decisions that are taken – not just councils – and putting them back in control over their lives.
“We'll be looking at applying this approach to other government programmes in the future too, as we press on with the work of building a country that works for everyone.”
To bribe = soudoyer…
Le populisme, une méthode pour rendre acceptable la fracturation hydraulique?
Quelques jours plus tard il n'est plus question que de quelques centaines de livres, versées 5 ans plus tard… Mais l'effet d'annonce a eu lieu!
11.08.16. - Le maintien des prix du pétrole au plus bas – ils ont chuté de 70 % entre l’été 2014 et début avril 2016, de plus de 110 à environ 40 USD pour le baril de Brent – aurait pu être une bonne nouvelle à savourer pour la France et les pays de la zone euro, bénéficiant de ce regain de compétitivité inespéré qui s’ajoute à un taux de change de l’euro toujours favorable. C’est une bonne nouvelle, mais entachée d’un effet indésirable qui n’a de cesse de faire sentir ses effets catastrophiques : l’effondrement économique et financier des pays producteurs d’hydrocarbures, qui alimente un ralentissement de l’économie mondiale déjà plombée par le coup de frein à la croissance chinoise. De nombreuses matières premières et produits de base connaissent le même sort que le pétrole.
Résultat : nombre de secteurs industriels, à commencer par l’énergie au sens large, sont aussi en difficulté. En 2015, Euler Hermes a ainsi réduit les notes de risque de quelque 148 secteurs (pour 76 améliorations), un secteur sur 4 présentant, selon cet assureur-crédit, un risque « significatif » ou « élevé ». Aux États-Unis, les faillites dans les secteurs liés à la production de gaz de schiste se sont multipliées.
[…] Ce Guide de la gestion du risque client à l’international, dont c’est la cinquième édition cette année, est justement conçu pour fournir les dernières informations sur les solutions. Il s’adresse avant tout aux dirigeants d’entreprises eux-mêmes, mais aussi à leurs équipes commerciales et celles des directions financières ou de l’administration des ventes.
Quand les faillites liées à la production du gaz de schiste servent d'arguments promotionnels pour un ”guide de la gestion du risque client à l'international”…
08.08.16. - On Friday evening, just after 6pm, government spin doctors sent select media an email with a big fracking announcement. Theresa May has re-written Osborne’s plans to ensure local people benefit directly from fracking.
“Communities could receive up to 10% of tax revenues derived from shale exploration in their area to spend on priorities such as local infrastructure and skills training. The new fund could deliver up to £10 million per eligible community.”
There were just two rules. First, the story was embargoed until Sunday, so there were no working hours between the email being sent and the story going live.
Second, the information was “shared on a no approach basis”. Reporters had to report the news without actually checking it with anyone else – a trick used extensively during the referendum campaign.
It’s easy to understand why.
Like much of what was said in the build up to Brexit, the government’s fracking claim is, at best, massively misleading and, at worst, a bald-faced lie.
It’s almost certainly not £10k
Helpfully for some, Westminster spin doctors were available to take the calls of confused reporters who were unable to ask anyone else anything at all.
We don’t know exactly what they said – because they briefed anonymously and off the record – but it appears they briefed out that the £10m could, in theory, be divided by number of households in a village.
There won’t be payments during exploration
But wait. We’re getting ahead of ourselves. Back up.
The whole point of the announcement is to build support for shale gas exploration in communities right now. That’s why the presser said “derived from shale exploration in their area”.
But the money it’s talking about only exists after shale exploration. It applies to the tax on the profits from full-on commercial gas extraction, which is totally different.
Indeed, as the government’s own consultation highlights, exploration and production may not only be years apart, they may not even happen in the same place.
“As these production sites have not yet been developed,” the consultation notes, “we do not yet have a full picture of precisely which areas will host shale developments, and how the communities associated with a particular development should be defined.”
Instead, the consultation goes on, communities during the exploration phase will be offered £100,000 per “fracked well” under a non-legally binding industry scheme.
There is no plan to pay that directly to households but if they were it would work out to be £136 for each of the 735 households in the village of Balcombe.
There may never be money for the payments
But there is a bigger problem.
Even once the industry is up and running, the whole plan depends on the government raking in around £10bn in tax from shale gas – which could politely be described as optimistic.
That’s because the UK has already claimed “the most generous tax regime in the world” for shale gas companies, who will pay tax at between 30 and 40% on their field profits.
If they make any profits, that is.
Profits depend on much gas there is, how costly it is to extract and the market price of oil and gas, which has been volatile of late.
In its latest update on the UK’s North Sea fields the government’s tax and spend watchdog, theOffice of Budget Responsibility (OBR), noted that “there are only a few profitable firms” left in the sector.
In the US it is fracking firms heading for bankruptcy leaving communities and taxpayers with the costs of cleaning up afterwards.
And even profit-making firms don’t always pay much tax.
As we reported earlier this year, UK fracking firms will be able to offset the money they spend on drilling and infrastructure against their tax liability.
Treasury documents suggest the costs of that will start being felt as soon a production starts.
In fact, right now, the UK is paying tax back to the oil and gas sector.
The latest OBR forecasts suggest the the taxpayer will pay oil companies over £1bn a year from this year through to 2021 as they reclaim money to pay for their losses and costs of decommissioning.
In fact, the payments idea may not happen at all
Indeed the policy itself doesn’t really exist
The consultation states that households should “gain directly” but the issue of “direct payments” is instead phrased as a question, with no guarantee it will actually happen.
It notes that household payments may not be very generous
“There will clearly be a trade-off for communities in either choosing to benefit from funds directly, which may result in a relatively small per-household payment depending on the revenues and size of a particular community”.
With officials themselves noting concerns that fracking could reduce the value of house prices by 7% it’s easy to see how a payment of a few hundred or thousand pounds if things work out in future may prove a hard sell.
The payments that may happen aren’t from the government
There is – actually – another scheme to pay communities who find themselves close to new fracking wells.
The industry has suggested it will give 1% of revenues, with two thirds going to communities affected – though again the pledge is both non-binding and constantly up for review.
If it was paid to households on a big site – let’s say with revenues of £100m – that would work out at around £1000 for a small rural community like Balcombe.
And there isn’t any plan to do that either.
Tout est bon pour accélerer l'acceptabilité de la Fracturation Hydraulique en Grande-Bretagne. Greenpeace analyse en détail l'esbrouffe que représente cette proposition faite par la nouvelle Première Ministre, Theresa May.
On arriverait à une somme de 136£ pour chaque famille de Balcombe… on est bien loin des chiffres qui ont circulé le jour de la déclaration de Theresa May, à savoir 10.000£.
Ça ne vous rappelle rien? Les soit-disants 100.000 emplois sur le territoire français qui, après un calcul correct étaient ramenés à quelque 2000 emplois!
Chesapeake Energy its interests in the Barnett shale in north Texas - the birthplace of the shale revolution - to Saddle Barnett Resources.
CHK says leaving the gas fields will cut shipping and processing costs by $715M by the end of 2017, eliminate ~$1.9B in long-term pipeline agreements, increase operating income through 2019 by $200M-$300M annually, and increase the PV-10 of its proved reserves by ~$550M.
As part of the deal, CHK will pay $334M to Williams Partners to end their current gathering agreement, projected MVC shortfall payments and fees pertaining to the Barnett Shale assets, with Saddle Resources also expected to pay an unspecified additional sum.
[…] The Barnett deal includes ~215K net developed and undeveloped acres and ~2,800 operated wells
Quand Chesapeake commence à vendre les bijoux de famille pour sauver les meubles…?