POTUS Obama - calls for Nat Gas Fueling stations (14 SOTUA)
Tonight POTUS Obama gave by far his strongest endorsement ever for Nat Gas as a surface fuel. And did so in his most visible and impactful speech of the year - the 2014 SOTUA. T. Boone Pickens must be doing a jig in somewhere in Texas as I type this.
"Now, one of the biggest factors in bringing more jobs back is our commitment to American energy. The all-of-the-above energy strategy I announced a few years ago is working, and today, America is closer to energy independence than we’ve been in decades.
One of the reasons why is natural gas – if extracted safely, it’s the bridge fuel that can power our economy with less of the carbon pollution that causes climate change. Businesses plan to invest almost $100 billion in new factories that use natural gas. I’ll cut red tape to help states get those factories built, and this Congress can help by putting people to work building fueling stations that shift more cars and trucks from foreign oil to American natural gas. My administration will keep working with the industry to sustain production and job growth while strengthening protection of our air, our water, and our communities. And while we’re at it, I’ll use my authority to protect more of our pristine federal lands for future generations."
In particular, note the "working with industry to sustain production" which at first glance might sound like a throw away line, but it has been carefully crafted. Our read is that this reference was included to signal a willingness to provide producers incentives to build well head capture trains and perhaps pipelines to reduce the flare off wastage of our Nat Gas resources. But at the same time, expect the EPA to start also tightening the screws on flaring. Such would dramatically increase supply - even without requiring any additional drilling. An idea even the Greenies can love.
Expecting all plays levered to NGVs to get a sustained bump, including our favs $QTWW, $GTLS and to a lesser extent even $LNG.
Earnings show signs of further OEM producer committed to CNG. As such, we see this "sustained bump" will continue. But for full disclosure, we did trim today, selling our T2 (back to our core + T1) with sales at $10.50 and $10.75. Cost basis returned to zero and even booked some Q1 profits.