Portfolio

Noting it has made some “minor tweaks” to its portfolio of public-sector bond financing packages, the Southern California Public Power Authority (SCPPA) executive director said Tuesday that none of the authority’s renewable and other energy projects currently being pursued have been affected by the subprime mortgage market meltdown that continues to adversely affect some of its counterparties. Standard & Poor’s Ratings Services (S&P) reiterated double-A level credit ratings for SCPPA.

A final generic environmental impact statement for developing and implementing an Energy Portfolio Standard (EPS) — a key step toward New York’s goal of reducing electric usage by 15% of projected levels by 2015 and setting an energy efficiency goal for natural gas — has been accepted by the New York State Public Service Commission (PCS).

Key elements of the energy policy bill and auxiliary tax package passed by the U.S. House of Representatives a week ago — notably a mandatory 15% renewable portfolio standard (RPS), increased taxes on the oil and gas industry, and the lack of increased fuel efficiency standards for autos — spell trouble for a conference committee attempting to reconcile the House bill with a U.S. Senate bill passed earlier this summer (see NGI, June 25).

Key elements of the energy policy bill and auxiliary tax package passed by the U.S. House of Representatives over the weekend — notably a mandatory 15% renewable portfolio standard (RPS), increased taxes on the oil and gas industry, and the lack of increased fuel efficiency standards for autos — spell trouble for a conference committee attempting to reconcile the House bill with a U.S. Senate bill passed earlier this summer (see Daily GPI, June 25).

Tortoise Capital Advisors LLC, whose portfolio includes emerging exploration and production master limited partnerships (MLP), has formed an oil and gas company. Headquartered in Overland Park, KS, Tortoise Gas and Oil Corp. will have equity of $82.9 million and available capital of more than $100 million for direct investments in energy producers. “We formed Tortoise Gas and Oil Corp. primarily to respond to the growing need by private and public U.S. energy production partnerships for timely and flexible direct placement financing to fund internal growth projects and acquisitions,” said Managing Director David Schulte. “We intend to invest directly in privately held companies and publicly traded MLPs operating primarily in the upstream segment, and to a lesser extent the midstream segment, of the energy sector.” Tortoise now has about $10 million invested in High Sierra Energy LP, $10 million in International Resources Partners LP and $7.5 million in EV Energy Partners LP.

As part of its plan to reduce debt and strengthen its balance sheet, CMS Enterprises announced Wednesday that it has completed the previously announced sale of a portfolio of its businesses in Argentina and its northern Michigan nonutility natural gas assets for about $130 million (see Daily GPI, Feb. 5). The principal subsidiary of CMS Energy sold its interests in those businesses to Michigan-based Lucid Energy. The Argentina businesses sold by CMS Enterprises were the CT Mendoza and Ensenada generating plants and the TGM natural gas pipeline business. The sale of Argentine businesses originally was to include the CMS Enterprises interest in Hidroelectrica El Chocon SA. However, the CMS Enterprises 17.2% interest in El Chocon was sold last week to Endesa under a separate arrangement after Endesa exercised a right of first offer for $50 million. The total proceeds from the two transactions — the sale to Lucid Energy announced today and the sale of the El Chocon interest announced Friday — are $180 million. In Michigan, the sale to Lucid Energy includes CMS Enterprises’ natural gas pipelines and processing assets, the Antrim natural gas processing plant, 155 miles of associated gathering lines and interests in three special purpose gas transmission pipelines that total 110 miles. As a result of the sales to Endesa and Lucid Energy, CMS Energy expects to recognize an after-tax, noncash loss of approximately $160 million in the first quarter of 2007. CMS Enterprises said it will maintain its interest in the TGN natural gas business in Argentina, which remains subject to a potential sale to the government of Argentina or some other disposition. Regarding CMS Enterprises’ commitment to sell its 23.5% interest in TGN, CMS Energy said it expects to record an after-tax impairment charge of approximately $140 million in the first quarter of 2007 to reflect the fair value of its TGN ownership interest.

A federal renewable energy portfolio standard (RPS) of 15% would drive down natural gas demand and price and lower the overall price of power, but would only lead to a lowering in the growth rate of greenhouse gas emissions (GHG) rather than an absolute reduction from current levels, according to a new study by UK-based consultants Wood Mackenzie.

A federal renewable energy portfolio standard (RPS) of 15% would drive down natural gas demand and price and lower the overall price of power, but would only lead to a lowering in the growth rate of greenhouse gas emissions (GHG) rather than an absolute reduction from current levels, according to a new study by UK-based consultants Wood Mackenzie.

Houston-based Copano Energy LLC. expanded its commodity risk management portfolio through the purchase of Houston Ship Channel Index natural gas call spread options to hedge a portion of its net operational short position in gas when operating in a processing mode at its Houston Central Processing Plant.