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   Technology StocksKMI- a fallen high dividend yielder - for how long?


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From: gypsees5/4/2020 8:01:59 PM
   of 138
 
So I got out of DHT with a small profit. I just got nervous holding ahead of earnings tomorrow. Even a small profit is better than a loss so I will take it..lol.. I have my cheap position still but so far is holding above yesterday's low. Yippee!

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To: gypsees who wrote (98)6/18/2020 10:12:01 AM
From: robert b furman
   of 138
 
LNG exports growing to China and Turkey - has to be good for the largest owner of natural gas pipelines = KMI!

ALEX KIMANI

Alex Kimani is a veteran finance writer, investor, engineer and researcher for Safehaven.com.

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U.S. Is The Surprising Winner In China’s LNG MarketBy Alex Kimani - Jun 17, 2020, 3:00 PM CDT

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The natural gas market is reeling from the triple whammy of a stubborn supply overhang, particularly in the Asia-Pacific region--which accounts for nearly two-thirds of global demand--a mild winter, and a hobbled global economy. China has emerged as a rare bright spot as energy demand in the country remains relatively high. However, Beijing is taking advantage of the health and economic crisis to do a dramatic overhaul of its natural gas supply chains.

China has shifted its attention from its traditional Central Asia supply hub further west where another natural gas and LNG powerhouse is emerging.

The United States is emerging as the surprising winner as China, the world’s second-largest importer of liquefied natural gas (LNG), continues to ramp up its LNG imports despite a buildup of tensions between the two nations.

Force Majeure

Over the past decade, Turkmenistan, Uzbekistan, and Kazakhstan have emerged as major natural gas exporters to China. In 2019, Turkmenistan sold over 30 billion cubic meters (bcm) of natural gas to Beijing--good for more than 90% of its total exports--with Uzbekistan and Kazakhstan exporting 10 bcm apiece to the Middle Kingdom.

Things have, however, taken a turn for the worse--especially for Turkmenistan.

In early March, Kazakhstan revealed that Beijing had issued a force majeure declaration to state pipeline company KazTransGas (KTG) regarding its natural gas supplies. Consequently, import data published by Beijing revealed that Turkmen imports had declined some 17.2% during the first two months of the year. Meanwhile, Uzbekistan’s exports to China, of which gas is a major component, fell 35.4%. Kazakhstan was the outlier in this trilogy, with its natural gas exports to China rising 31.6%. Related: China Drops Energy Efficiency Targets Amid Covid-19 Crisis

The same trend continued in March and April, with Turkmen and Uzbek exports to China falling in excess of 20% and 30%, respectively, while Kazakh exports once again climbed more than 20%.

Despite these large declines in natural gas imports from Central Asia, China’s National Development and Reform Commission has claimed that natural gas consumption by the country increased by 1.6% to 78.5 bcm during the first quarter.

China’s LNG Imports Grow

China’s largest LNG importer, China National Petroleum Corporation (CNOOC), and PetroChina also invoked force majeure clauses on various LNG suppliers, though the notice was rejected by Shell, Total, and Qatargas.

Meanwhile, commodity trading houses such as Trafigura as well as Middle East gas producers did not officially confirm receiving the notices. However, China resumed buying LNG cargoes later in the quarter as spot market prices plunged to multi-year lows.

And now, Natural Gas Intelligence (NGI) has reported that China’s LNG imports have actually been rising on a year-on-year basis, with the U.S. stealing market share from traditional powerhouses Australia and Qatar.

According to Wood Mackenzie via NGI, China took in 10 LNG cargoes from U.S. suppliers between April and May at the expense of Australia whose market share slipped up in May.

There are several plausible explanations as to why China is buying U.S. LNG—despite Washington and Beijing feuding over everything from the novel coronavirus to Hong Kong to 5G networks.

First off, China could be using the crisis as a bargaining chip to renegotiate its contracts with long-term suppliers, including Turkmenistan and Uzbekistan. This could, however, prove to be a tough proposition because force majeure cases are rarely straightforward and even reference to specific events like ‘epidemic’, ‘acts of government,’ or ‘quarantine restrictions’ under an SPA (sale and purchase agreement) does not automatically guarantee relief. Related: The Oil & Gas Sector Could Already Be In Terminal Decline

Second, Beijing could be trying to increase its sphere of influence in Central Asia, a region that has long been a geopolitical battleground between Beijing and Moscow.

It is instructive to note that Russia and Turkmenistan have reached a tentative rapprochement that saw a resumption of gas exports from Turkmenistan to Russia sometime in mid-April after ceasing exports in January 2016 over a dispute over price and payments. A decade ago, Turkmenistan was exporting over 40 bcm/yr of gas to Russia, significantly more than its current exports to China. Perhaps it is not a coincidence that China has fallen out with Turkmenistan at a time when the latter has made up with Russia.

Meanwhile, in February, under pressure from Moscow, Uzbekistan became an observer of Russia’s Eurasian Economic Union (EAEU), probably irking China.

Lastly, Beijing might simply be trying to stick to the January trade agreement with Washington to prevent another full-blown trade war. Although the accord did not specify quantities of the products, it committed Beijing to purchase an extra $52.4 billion of U.S. energy supplies over the next two years.

Under the deal, China’s deal amount increases to $18.5 billion in 2020 and another $33.9 billion in 2021 from a baseline of just $9.1 billion in 2017. China has already instructed state-owned firms to suspend large-scale purchases of U.S. farm produce including soybeans and pork, in retaliation to Trump’s Hong Kong stance but has not said anything about energy products.

Whatever the case, U.S. LNG suppliers appear to be cozying up to a second major customer after recently doing so with Turkey.

By Alex Kimani for Oilprice.com

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To: robert b furman who wrote (99)6/18/2020 1:14:48 PM
From: E_K_S
   of 138
 
I picked more KMI up last week at $15.75/share got my avg cost to $15.85/share and then will Buy add a few anytime it sells below 2% of my avg cost. Collecting the dividends all the time.

Have done the same w/ WMB too.

EKS

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To: E_K_S who wrote (100)6/18/2020 6:37:16 PM
From: robert b furman
   of 138
 
Hi EKS,

My average is $17.03. I have swapped a lot of Cohu for KMI.

KMI is now my biggest dividend payer in total dollars.

I love this stock. I think it is going to be my very best dividend growth stock in my retirement account.

I've sold the heck out 12, 13, and 14 puts. ( I sold them when KMI dropped below 15.00).

I'd like to add 2500 more shares, but keep selling puts to help pay for them.

I'll add to the position before they look at the extra 20 cants to be paid at year end - then I'll watch and collect. <smile>

Bob

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From: E_K_S7/9/2020 9:33:59 AM
   of 138
 
In for a few more KMI at $14.43/share. Small Buys w/ next larger Buys at/near $12.75/share . .Will be interesting to hear update from the company on how their delivery contracts are going especially from Chapter 11 customers.

PBA another pipeline I own has seen some heavy insider buying.

EKS

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To: E_K_S who wrote (102)7/9/2020 12:22:43 PM
From: robert b furman
   of 138
 
Hi E_K_S,

What are your thoughts on what ramifications could a BK customer have?

They have their commodity in the pipeline. They bill monthly.

If a bankruptcy judge wanted to continue the cash flow from continued oil or liquids or natural gas, he'd authorize payment for the services.

Upon complete resolution, the new acquirer of the wells would want to continue transporting. A new contract would be negotiated. The worst I'd see is a small delay that would max out for 30 days?

I'm not at all and attorney, but they do strive to keep a company going, and pay all of the attorneys.

I'd think the pipeline would be the last company to intentionally hurt, as they're providing revenue that will pay the attorneys?

Sort of like being in bed with the right crowd!

BWDIK?

Bob

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To: robert b furman who wrote (103)7/9/2020 12:43:05 PM
From: E_K_S
   of 138
 
You see it the way I see it.

Also, what other things can be moved in/on those pipelines & easements? Water, hydrogen and even dark fiber lines. Those pipes and easements are valuable (other ideas; 5G cell towers, windmills, solar panels) .

NG & oil assets are always in stronger hands after a BK.

Just need to be cautious on their debt obligations, expected/new cash flows and what options they have to enter into new contracts (both on use of easements and future delivery contracts).

EKS

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From: E_K_S7/17/2020 2:43:29 PM
   of 138
 
FERC was busy today . .

FERC clears Kinder Morgan to begin Elba LNG Unit 8 service

Jul. 17, 2020 9:53 AM ET|About: Kinder Morgan, Inc. (KMI)|By: Carl Surran, SA News Editor

Kinder Morgan's ( KMI +1.5%) request to place the seventh liquefaction train at its Elba Island liquefied natural gas export plant in Georgia into service is approved by the Federal Energy Regulatory Commission.

Kinder Morgan said earlier this week that Train 8 was ready for service; trains 1-6 already are in service, and units 7, 9 and 10 are in various stages of commissioning.

Elba, which is 51% owned by units of Kinder Morgan and 49% by EIG Global Energy Partners, is designed to liquefy ~2.5M mt/year of LNG; Royal Dutch Shell ( RDS.A, RDS.B) has a 20-year contract to use the facility.

----------------------------------------------------------------------

Williams wins FERC approval for Leidy South gas project
Jul. 17, 2020 2:37 PM ET|About: The Williams Companies, Inc. (WMB)|By: Carl Surran, SA News Editor

Williams ( WMB -1%) says the Federal Energy Regulatory Commission approved its Leidy South natural gas pipeline project in Pennsylvania that will create 582K dth/day of additional pipeline capacity.

The project will connect gas produced by Cabot Oil & Gas ( COG +0.8%) and Seneca Resources in the Marcellus and Utica regions with demand markets along the Atlantic Seaboard by the 2021-22 winter heating season.

By maximizing the use of the existing Transco transmission corridor and expanding existing facilitiesa, Williams says Leidy South will reduce the amount of new infrastructure and land use needed.

Williams recently was upgraded to Overweight at Morgan Stanley, citing its gas gathering exposure that stands to benefit from a potentially pipeline constrained Bakken pending a resolution of the Dakota Access Pipeline.

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From: E_K_S7/23/2020 9:19:21 AM
   of 138
 
Kinder Morgan EPS beats by $0.01, misses on revenue
Jul. 22, 2020 4:08 PM ET|About: Kinder Morgan, Inc. (KMI)|By: Vandana Singh, SA News Editor

Kinder Morgan (NYSE: KMI): Q2 Non-GAAP EPS of $0.17 beats by $0.01; GAAP EPS of -$0.28 misses by $0.46.

Revenue of $2.56B (-20.2% Y/Y) misses by $340M.

2Q adjusted EBITDA of $1.57B compared to estimate $1.63B.

Distributable cash flow of $1,001M, -11% Y/Y.

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To: E_K_S who wrote (106)7/23/2020 9:19:41 AM
From: E_K_S
   of 138
 
Kinder Morgan slips after posting Q2 GAAP loss, DCF/share dips Y/Y
Jul. 22, 2020 5:28 PM ET|About: Kinder Morgan, Inc. (KMI)|By: Carl Surran, SA News Editor

Kinder Morgan (NYSE: KMI) -3.6% after-hours as Q2 results show adjusted EBITDA fell 14% Y/Y to a slightly-lower-than-forecast $1.57B, and distributable cash flow fell to $0.44/share from $0.50 a year earlier.

Kinder still achieved $404M of excess distributable cash flow above its declared dividend, which rose to $0.2625/share from $0.25 a year earlier.

The company lost $637M compared to a $518M profit in the year-ago quarter, after taking a $1B impairment charge as the recent sharp decline in natural gas production affected a number of its assets.

Kinder says its board "remains committed to increasing the dividend to $1.25 annualized as we projected, under far different circumstances, in 2017."

Because of the COVID-19-related reduced energy demand and the sharp decline in commodity prices, the company now expects full-year DCF to be below its initial $5.1B projection by slightly more than 10% and adjusted EBITDA to come in below the $7.6B plan by slightly more than 8%.

Kinder has cut its 2020 expenses and sustaining capital spending by $170M combined from its original budget, and has lowered its full-year expansion capital outlook by $660M, or almost 30%.

The company says two of its key natural gas projects remain on track despite the coronavirus, expecting to start its Permian Highway Pipeline in Texas in early 2021 and the final three Elba Island LNG liquefaction plants this summer.

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