Cheap (Natural) Gas Prompts ConocoPhillips To Pull Plug On Pipeline Plans In Land Of Sarah Palin

[underpants]

Source: Forbes

The trend for natural gas price is difficult to forecast as it’s driven by demand and supply factors, including factors like natural gas reserves, crude oil price and inter-state pipeline charges. However persistently low prices in the US gas market relative to other commodity prices increases contributed to ConocoPhillips and BP calling off their $34 billion Alaska natural gas pipeline joint venture. <1>

Other key oil & gas players likely to be affected by this declining trend are Exxon Mobil, Chevron and Anadarko. While we expect prices to recover, Trefis members predict higher gas prices in the coming years.

We expect that storage and extraction of natural gas will continue to be an issue which will eventually drive up natural gas prices, although at a moderate rate. While we anticipate the average price realized by ConocoPhillips on natural gas will increase moderately to $8.08 per 1,000 cubic ft., Trefis members predict a slightly higher price level of close to $10. The member estimates represent a marginal upside to our near $75 price estimate for COP stock. This is because of a relatively small contribution of natural gas to ConocoPhillips? stock value compared to other petroleum products produced by ConocoPhillips such as crude oil, natural gas liquids, gasoline, distillates, fuel oil, and a variety of others.

We have a price estimate of $75 for ConocoPhillips’s stock, implying an upside of around 5% to current market price.



Read more: http://blogs.forbes.com/greatspeculations/2011/06/09/cheap-gas-prompts-conocophillips-to-pull-plug-on-pipeline-plans-in-land-of-sarah-palin/?partner=relatedstoriesbox

[Blue_In_AK]

1. This news has been out for a bit, at least here.

Conoco and BP pulled their plug on the natural gas line, but apparently Trans-Canada, to whom Sarah promised $500 million in state funds to help them along, is still in the ballgame. We shall see.

Most Alaskans I know are in favor of a state gas line, running along the route of the Trans-Alaska Pipeline to bring the natural gas to Fairbanks and Anchorage, with spur lines out to the villages. It makes a whole lot more sense in Alaska, where our energy costs are some of the highest in the country.

[McCamy Taylor]

2. Prediction: Trans-Canada pockets their $500 million and then runs.

[Arctic Dave]

4. Hey BLue!

Exxon is pulling the plug too, they were partners with TC.

I am really excited about the legislation Bill Wielowkowski wants to introduce about cutting the middlemen(oil corps) out and stasrting a Business incentive corporation (read Alaska Oil Corp or something similar). If you haven't seen his presentation I would HIGHLY recommend it. ;)

[Blue_In_AK]

7. As Shannyn Moore says,

"the best Bill in Juneau." I love the guy.

I'll check out his plan, but is he still advocating partnering with Trans-Canada and going down that way, or is he in favor of an in-state line? The last I talked to him about this stuff, which was some time ago, he was trying really hard to convince me that AGIA was a good idea. Maybe he's changed his mind.

[Arctic Dave]

8. Sounds like he fed up with all of the O&G corporations.

Sounds like he is backing an All-Alaska pipeline. He talks about a economic incentive corporation which when he explains it sounds an awful lot like an Alaska Owned O&G producing corporation. I think he uses the terminology to keep it from sounding like(Gasp) we are socialising the profit and not just the risk.

[Tempest]

5. Trans-Canada can't do it without BP and Exxon

And with BP pulling out, it can't happen.

But Trans-Canada thanks Alaska for the $500 million.

[Arctic Dave]

3. Exxon has pulled the plug in Alaska also.

They are getting rid of everything on their pad and moving out.

[Historic NY]

6. That ought to burst her balloon.