HOME PAGE SUBSCRIPTIONS, Print Editions, Newsletter PRODUCTS READ THE PETROLEUM NEWS ARCHIVE! ADVERTISING INFORMATION EVENTS PETROLEUM NEWS BAKKEN MINING NEWS

Providing coverage of Alaska and northern Canada's oil and gas industry
November 2009

Vol. 14, No. 47 Week of November 22, 2009

Oil Patch Insider: A Boone worth Pickin’? Shell denies asking for decision delay; Enstar still upbeat on bullet line

Canadian investors are being given a chance to find out just how shrewd T. Boone Pickens is in reading future trends in the energy industry.

The one-time corporate raider and promoter of an energy plan to wean the United States of foreign oil, has filed a prospectus, in conjunction with BMO Nesbitt Burns, for the T. Boone Pickens Energy Fund.

The closed-end fund will concentrate on high liquid energy stocks and commodities, taking both long and short positions and using up to 30 percent leverage to generate better returns.

The prospectus says the stocks in its target field will include drillers, exploration and production companies and refiners.

There is no indication whether the fund will be influenced by Pickens’ current enthusiasm for natural gas-powered vehicles or wind power to reduce the $700 billion a year that it cost the U.S. last year to import oil.

The prospectus says the funds will follow an investment strategy “substantially similar” to Pickens’ BP Capital Energy Equity Fund.

Although the fund units are registered in Canada and intended for Canadian investors only, there will be no geographic boundaries on the investments.

BP Capital Energy has posted a compound annual growth rate of 20.2 percent before fees, which reduce investors’ annual take to 10.8 percent.

In addition, the Canadian fund will turn over 2 percent of the fund’s net asset value each year to BMO Nesbitt Burns, which will then pay Pickens’ investment team from the proceeds.

If the fund raises its net asset value over the course of a year, 20 percent of the gain will go to BMO Nesbitt Burns and the investment team.

Each $10 “combined unit” comes with a unit in the fund. Pickens said he will own 10 percent of the fund.

A month ago, Pickens forecast oil prices of $85 per barrel by the end of 2010, and said they could reach $90-$100 if there is a global economic recovery, while natural gas prices will average $7 per million British thermal.

But, without a plan for U.S. energy independence, oil could soar to $300 within a decade, he said.

Pickens said U.S. climate change legislation is essential to avert such an exponential increase, but he does not rule out the chances of President Barack Obama eliminating U.S. dependence on Middle Eastern oil over the next 10 years.

—Gary Park

Shell denies asking for delay in drilling decision

Marvin Odum, Royal Dutch Shell’s U.S. subsidiary president and executive VP for exploration in the Americas, says the company did not ask the Minerals Management Service to delay a decision on Shell’s request to drill for oil and gas in Alaska’s Chukchi Sea.

Odum said after a Senate hearing Nov. 19 that he only knew what he “read in the papers” about the delay granted this week by the Interior Department, adding that Shell did not request it.

But a letter from MMS, an arm of the Interior Department, says Shell requested the delay so it can respond to a deluge of public comments on the drilling proposal.

The Nov. 17 letter from John Goll, regional director of MMS in Alaska, says Shell has 10 days from the receipt of the letter to respond to comments.

—Matthew Daly, Associated Press, Washington. D.C.

Enstar still upbeat on bullet line

John Sims, Enstar’s director of corporate communications, says the Anchorage-based utility is still bullish on a bullet line from the Brooks Range Foothills to Southcentral Alaska, but “from a long-term perspective” a continuous gas supply from Cook Inlet would be the “best case scenario” to supply Enstar’s customers.

The next best scenario, he said, would be natural gas from the North Slope and/or Brooks Range Foothills via a bullet or spur line.

Imported natural gas would be the “worst case scenario,” Sims said.

When asked about the State of Alaska’s decision to take over as lead on a possible bullet line from Anadarko Petroleum’s Gubik Complex in the Brooks Range Foothills, Sims said the state’s intervention was welcome and did not dim his company’s interest in the project.

“The state has more resources, more expertise … more everything than a utility company. The state’s able to get all the players in the room … so when they requested to take the lead, we gladly handed it over to them,” he said.

—Kay Cashman






Petroleum News - Phone: 1-907 522-9469 - Fax: 1-907 522-9583
[email protected] --- http://www.petroleumnews.com ---
S U B S C R I B E

Copyright Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA)©2013 All rights reserved. The content of this article and web site may not be copied, replaced, distributed, published, displayed or transferred in any form or by any means except with the prior written permission of Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA). Copyright infringement is a violation of federal law subject to criminal and civil penalties.