Hedge

The CEO of New York-based hedge fund Third Point LLC, which in November purchased a substantial stake in Pogo Producing Co. (see NGI, Nov. 27), on Friday demanded the company initiate a process to sell the company “in whole or part.” In a letter, Third Point CEO Daniel S. Loeb called the track record of Pogo’s CEO “long and meager” and said it was time for a change.

As the dominoes begin to fall in the wake of the collapse of energy hedge fund MotherRock LP. earlier this month, reports were circulating that Dutch bank ABN AMRO could be stuck with losses totaling $100 million, putting in jeopardy the banking giant’s plans to sell its global futures business to Swiss bank UBS, according to a story in the New York Post last week. Calls for comment to ABN AMRO were not returned.

As the dominoes begin to fall in the wake of the collapse of energy hedge fund MotherRock LP. last week, reports were circulating that Dutch bank ABN AMRO could be stuck with losses totaling $100 million, putting in jeopardy the banking giant’s plans to sell its global futures business to Swiss bank UBS, according to a story in the New York Post Wednesday. Calls for comment to ABN AMRO were not returned as of press time.

After less than two years of operation, word on the trading floor of the New York Mercantile Exchange (Nymex) Thursday was that energy hedge fund MotherRock LP is closing its doors following large natural gas trading losses over the past two months.

Hedge fund JANA Partners LLC may have gotten just what it wanted from Houston Exploration Co. (THX). The THX board last week unanimously voted down JANA’s $1.8 billion unsolicited acquisition proposal. But following the announcement, a JANA spokesman called the decision “a positive development.”

A major shareholder, the hedge fund Pirate Capital LLC reiterating its strong opposition, told independent directors of Mirant Corp. Monday it would call for a special meeting of the company’s stockholders if Mirant did not immediately drop its unsolicited bid for NRG Energy, Inc., prompting the Atlanta-based merchant power plant operator to quickly abandon the hostile takeover, although it continued to characterize the deal as a “compelling opportunity.”

Gas market participants who have groused that hedge funds and speculators have toyed with their purse strings will have a new (and more real) bogey man in the years to come as liquefied natural gas (LNG) captures an increasing share of the North American gas market and the United States becomes more exposed to overseas pricing dynamics..

Chesapeake Energy Corp. over the past month increased its hedge position, locking in an average Nymex price of $9.49/MMBtu for 721 Bcf of natural gas production over the next three years.

The Los Angeles Department of Water and Power (LADWP) is still attempting to lock in both long-term natural gas supply contracts and reserves as a hedge against future volatility in wholesale energy prices at the same time it is lining up more renewable sources of power for its system that enjoys about a 2,000 MW surplus already for peak loads. Completion of nearly half of a 10-year, $1.8 billion re-powering program further changes its future energy mix, a LADWP executive told NGI Wednesday.