Australia's largest stock trading and investment forum Australia's #1 stock forum

LNG

0.00%

4.3¢ liquefied natural gas limited

Interesting comments DArabie, good input. I was hopeful of other...

First 23 Last

Share
Profile

Follow
Bortgm

1,268 Posts.

173

18/02/15

11:06

Post #: 14775139
Share

Originally posted by DArabie ↑

All,

Cramer's point centers around the new found term for all new energy products, "Cost Effective"

Every project of any major cost that was planned a year or two ago and hasn't fully kicked off yet is on what most of us in or around the SW Texas/SE Louisiana area know as "Shaky ground" or likely to get pushed back or cancelled.
Cramer is right in that most of the planned Export projects centered around LNG going overseas will not get off the ground as the cost structure and profits have changed due to the fall in oil/LNG prices along with the reduced price in the SE Asia market for LNG now. Many of the smaller projects for so many of the new plants not financed by "Major" companies are just walking dead as the cost of borrowing will no longer be available due to credit problems on the rise from small oil companies already. They will be deemed too risky and put off until the always funny, "later date and time," which basically means if the prices/risk balance out then we will move ahead. Sasol has already "postponed" a part of their 8 billion dollar addition in Westlake due to the lack of cost effectiveness now. Oil companies will continue to cut CAPEX as well leading to a further struggle in the energy market in the US which will slow down all the talk of new construction for LNG exporting as well.

Now I will say that both Bear Head and Magnolia are one of the few plants coming on that are far ahead in the planning/construction side to turn back now thus meaning success should be quite high in completion in the future along with exporting. Profits should be ok even at the current price structure and supply will never be a problem as we still burn off more LNG daily as waste than we actually use in the US. Add to that, the ties with Kinder Morgan and you have a solid little company for a long time to come meaning your investment in this company looks good as long as you understand to only expect 2 plants and no more. There will not be a 3rd or 4th as so many have talked about due to the price structures now or even in the near future though any US listing would help the stock as valuation is still very low compared to the Cheniere and Dominion projects. Patience will be tested along the way to the summer but any current shareholder should be rewarded as we go forward with nice profits though new money is still risky at this point IMO.

Expand

Interesting comments DArabie, good input.

I was hopeful of other NA projects but that seems to cast a different shadow over that possibility. The other thing to note though is that the tech can be applied to other geographic areas also not just NA. So I remain hopeful that MB and the team are well across other 'viable' alternatives. Can't expect gems like BH everyday, but the capex/operational savings may indeed make some otherwise marginal opportunites viable.

That said, if we built just Maggy and BH, I don't think it would matter too much. I could comfortably live off the dividends.

LNG Price at posting: $3.40 Sentiment: Buy Disclosure: Held
4 Upvote

0 Great analysis

Reply

Top Stories

I88

Infini soars 50% as company reveals it could’ve just made uranium history – redefining what it means to be “high grade”

Bitcoin investors need to know the risks

ARN

Aldoro shares jump 47% on news of strong niobium recoveries from Namibia play

RCE

Recce scores US$2M deal from US Department of Defense for burn wound infections gel

Week 28 Wrap: ASX hits all time high; CBA shares' two realities; US inflation hits 3% ahead of China plenum

There are more pages in this discussion • 40 more messages in this thread...

First 23 Last

Add LNG (ASX) to my watchlist

Interesting comments DArabie, good input. I was hopeful of other...

Top Stories

Infini soars 50% as company reveals it could’ve just made uranium history – redefining what it means to be “high grade”

Bitcoin investors need to know the risks

Aldoro shares jump 47% on news of strong niobium recoveries from Namibia play

Recce scores US$2M deal from US Department of Defense for burn wound infections gel

Week 28 Wrap: ASX hits all time high; CBA shares' two realities; US inflation hits 3% ahead of China plenum

Featured News