Winners and losers in energy sector from Texas cold snap
A winter storm that hit parts of the southern United States over the past week led several energy companies to report stronger-than-expected results after they were called on to provide more power at higher prices, while others faced millions of dollars in losses.
Source: Reuters
WINNERS:
Gas producers:
Comstock Resources said the last week was “like hitting the jackpot,” adding it was able to sell at “super-premium prices” a material amount of production at anywhere from $15 per million cubic feet of gas (mcf) to as much as around $179 per mcf.
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For investors and companies that spent years ignoring climate risks, the storm that buried much of Texas in frost and snow earlier this month is sending a wake-up call that’s reverberating even in Canada.
In recent years, at least three Canadian utilities had spied opportunities for predictable cash flows in the loosely regulated Texas electricity market, but they failed to foresee the climate-related risk.
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One of those companies, Mississauga-based Just Energy Group, a retail utility providing power from natural gas and renewable energy sources, told investors this week that it is now teetering on insolvency after incurring an estimated $315 million in losses as a result of the Texas storm. Analysts who pegged the company’s liquidity at $138 million, said
Power Producers Extend Canada Loss Streak as Bond Yields Pop
Bloomberg 2/25/2021 Michael Bellusci
(Bloomberg) Some of 2020’s top performing stocks in Canada have lost some luster as bond yields grind higher and recent power woes in Texas add to the drag.
Canada’s utility stocks have fallen for 13 straight sessions, their longest losing streak on record. Rising yields on bonds reduce the attractiveness of utilities as a safe-haven for dividend-oriented investors.
The “dramatic” spike in bond yields has been the primary culprit for the sector’s weakness, said Chris Kerlow, a Toronto-based portfolio manager at Richardson Wealth Ltd. The firm remains positive on Algonquin Power & Utilities Corp. because of its power and renewable exposure.
Power Producers Extend Canada Loss Streak as Bond Yields Pop msn.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from msn.com Daily Mail and Mail on Sunday newspapers.