Spring Gleaning

By Robert Rapier and Igor Greenwald • April 11, 2014 • Issue Articles

In this issue:

Like a pig inside a python, the domestic crude glut is expected to move from the Midwest down to the Gulf, to the cost of some producers and the benefit of well placed refiners.

Our portfolio is in subtraction mode this week after profiting from numerous new recommendations over the last 16 months. No garden can bloom without a bit of weeding now and then.

Portfolio Action Summary

Afren (LSE: AFR) removed from Aggressive Portfolio
Fuel Systems Solutions (Nasdaq: FSYS) removed from Aggressive Portfolio
Mid-Con Energy Partners (Nasdaq: MCEP) removed from Growth Portfolio
Tenaris (NYSE: TS) removed from Aggressive Portfolio
GasLog (NYSE: GLOG) position reduced by half in Aggressive Portfolio
Core Labs (NYSE: CLB) confirmed as Hold in Growth Portfolio
EQT Midstream (NYSE: EQM) buy limit raised to $70 in Conservative Portfolio
Western Gas Partners (NYSE: WES) buy limit raised to $64 in Conservative Portfolio
Helmerich & Payne (NYSE: HP) buy limit raised to $112 in Growth Portfolio
EOG Resources (NYSE: EOG) buy limit adjusted for split to $100 in Growth Portfolio

Commodity Update

The front month contract (May) of West Texas Intermediate (WTI) is stubbornly clinging to $100; on Tuesday it stood at $101.24 per barrel, up $2 from two weeks ago. Brent traded down $0.69/bbl to $106.30, dropping the Brent-WTI spread to $5.06/bbl. One year ago WTI was at $93.36, Brent was at $103.16, and the Brent-WTI spread had just dropped below $10/bbl for the first time in nearly a year. The front month natural gas contract traded Wednesday at $4.54/MMBtu, which is up $0.14 from two weeks ago, and $0.36/MMBtu higher than the price a year ago.

In Other News

Citigroup agrees with our bullish stance on natural gas, writing in a report that natural gas prices are too low and put the US at risk of of a shortage next winter

China is the world leader in clean energy investment, according to Pew Charitable Trusts, with $54 billion of investments in 2013, well ahead of the US investment of $37 billion

Anadarko Petroleum (NYSE: APC) shares surged nearly 20 percent after the company announced a $5 billion settlement of environmental liabilities from a legacy asset
Reuters reports that suspected pipeline cracks may derail attempts to restart production this year at the massive Kashagan oil field in Kazakhstan

We have warned about coal companies, and this week James River Coal Company (NASDAQ: JRCC) fell over 50 percent after filing for Chapter 11 bankruptcy

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About The Author

Robert Rapier

Bio | Archive

It's hard to imagine anyone better suited to covering the energy-investment waterfront than Robert Rapier.

Robert is no armchair analyst—he has two decades of in-the-trenches experience in a wide range of fossil fuel and biofuel technologies, including refining, natural gas production, gas-to-liquids, ethanol production and butanol production.

During a six-year stretch at ConocoPhillips, Robert ran a team of engineers in Scotland working on oil and gas projects in the North Sea.

For two years, Robert was an efficiency expert in a Texas petrochemical plant. The process changes he implemented saved the facility $9 million a year. He later worked as the Engineering Director for a Dutch environmental-technology company and provided engineering support for a Chinese facility the company was constructing.

Robert was also a butanol engineer in Germany for the Celanese Corporation, where he designed a novel butanol unit that cut production costs by $5 million per year.

In all, Robert has spent more than a dozen years working on liquid fuels technologies. Along the way he's picked up five patents, including one for a breakthrough way to convert ethane into ethylene (U.S. Patent 7,074,977).

Now, in addition to guiding readers to timely investments in Utility Forecaster and Rapier's Income Accelerator, Robert travels the world evaluating startup energy companies for deep-pocketed investors. After grilling management and assessing the technology on-site, he makes a go/no-go investment decision. His wealthy private investors and hedge fund backers trust him to make the right choice for the same reason we do: his vast real-world experience in just about every facet of the energy industry. If Robert votes thumbs-up, millions of dollars flow into these cutting-edge outfits.

Robert earned his master of science in chemical engineering and a bachelor of science in chemistry and mathematics (double major) at Texas A&M University. He tells us he was "this close" to finishing his Ph.D. before he decided he was having a lot more fun making money in energy stocks.

A prolific writer, Robert's articles have appeared in Forbes, The Wall Street Journal, The Washington Post and the Christian Science Monitor -- and he has been a featured expert on 60 Minutes and The History Channel. His new book, Power Plays: Energy Options in the Age of Peak Oil (Apress, 2012), helps investors sort through doom and gloom, hype and misinformation to understand the true costs, benefits and trade-offs for each of our major energy options.

In what little spare time he has left, Robert consults for a number of energy projects, including biodiesel, ethanol, butanol and biomass gasification facilities.