"The news about TK Operations could turn out to be a dud." stj - the biggest issue I see is TNK has said nothing about this. They have not disclosed how much they paid. Question is, why?
bill, shipping product is good, as is shipping oil. If we have too much of either one, then best to sell it. It does us no good to sit on it.
Every barrel we sell, be it oil or product, creates a micro-tick to GDP.
stj, an aframax crude tanker can be cleaned and coated to carry products. The cleaning process is expensive and so not something done on whim. TNK is not alone in this type of analysis, the aframax shortage a couple of months ago was amplified due to aframax ships exiting the crude shipment market.
no, your assumptions are childish and simplistic. I suggest you read a book or take a course in macroeconomics. The jobs paranoia is ridiculous, as is the billionaire talk. You're out of your league, but goodl luck.
you are correct - not crude, they alter it "just enough" to get around the ridiculous paranoia about exporting crude which we will soon have too much of as our appetite for crude oil declines. This is 2014, not 1974. Our cars get 40MPG, not 12MPG. Shipping away "oil" will not hurt us, and if we ever decide to keep it, then we keep it. If anything, the USA shipping oil out tells OPEC that they no longer own us.
Still thinking it will never occur pb? Now you know why TNK "argued" with you about oil exports, and why this silly notion about protecting American jobs is ridiculous and short sighted. The USA will export oil, period.
Investors's Business Daily today reports:
BP (BP) bought the majority of capacity at a Kinder Morgan Energy Partners' (KMP) mini-refinery near Houston as part of an inexpensive plan get past the ban on exporting U.S. crude oil.
Under the deal, BP will buy at least 80% of the capacity of the $360 million refinery. The plant is expected to open in July and produce 100,000 barrels of refined oil per day. The refinery will process the oil only slightly so it falls outside the ban. The plant costs just a tenth of the price of a full-scale refinery, prompting other oil companies like Valero Energy (VLO) and Phillips 66 (PSX) to look into similar refineries.
b&w, why so sensitive to an opposing opinion? It's a company, not your baby. Your timeframe is: " it will be worth about $125 to $150 going out the next few years". Really? More than double, in a "few" years? Does few mean 3? And how can you be so sure ? Will those .01 disty increases somehow double the stock?
The difference between FB and tulip bulbs is Facebook is selling to the planet, not some Dutch folks who like flowers. Really now, choose a better analogy. Enron? They were criminals, FB is transparent, and FB's CEO does not want to go jail.
Regarding an offer, if it is juicy enough MWE then has no choice. As much as it may not fit your ideal, the Board of Directors is not allowed to turn down an offer that would reward shareholders by 40%! You'd have an immediate class action lawsuit, several of them, and MWE would have to prove their crystal ball works in rejecting the offer.
As far as the managers paying 40 or 50% in tax, which is a stretch, that's how life works. They cannot put their interests over mine, their tax deferral over me, they are playing with the public's money.
I don't have any sympathy for you if you claim the associated taxes will reduce how much you can reinvest. To me, it sounds like greed. MWE does not exist your your sole benefit, you seem to forget this fact. You act as if you are the guardian of MWE. Since when?
b&w, with all due respect, I don't see how MWE doubles in your timeframe. As others have mentioned, the share price is a function of the distribution, and that will not be doubling in the next 2 years.
As far as taking Buffett's cash, I don't see how this is bad. You're acting as if you cannot invest the proceeds elsewhere. A profit, even if triggering tax, is never a bad thing.
Would it be so bad to take a MWE gain and put it into another company? I'm not suggesting this is a great idea, but have you seen what TSLA or FB has done in the pas 12 months? That is a rhetorical question! Not looking for an argument as to the merits of those companies, I'm only saying that profits can be invested elsewhere.
If, and it's a big if, Buffett offered $90, MWE's board has an obligation to sell. If they didn't, they're ripe for a shareholder lawsuit. It's just how things work. MWE's board is not allowed to play "what if".
"Total transparency is not necessarily a good thing."
It's a publicly held company. Think about your statement.
Regarding the ship, in the whacked out world of the middle east, that ship was being linked to a terrorist attack on an unrelated cable. Public information.
The ship was seized in March 2013. In May TNK said the borrower was in default but did not say B Elephant was under house arrest. This was common knowledge, so why not disclose it?
You seem offended that I do not kiss the feet of management. Yes charly, there are people out there who are critical when there is less than as you say "total transparency". I'm glad chan is exiting, who knows when he have chose to again avoid "total transparency". And of course chan is bullish now, because in three months he will have no role, no responsibility, no one to answer to.
The next shoe to drop will be, as more than a few have noticed, and quantuon is hoping to defend so as to make his boutique fund look good, what TNK paid TK for the brokerage business. Why did TK sell it if t was lucrative? And was it more of "total transparency" to not disclose the terms of the sale, when the sale was publicly announced? I find it odd that a company would not let its shareholders know the price of such a significant event.
I like dogs too. As far as management, yes, I am critical. They were not transparent with respect to the viability of the VLCC loans, and did not mention the ship had been seized by the Egyptian Navy.
Good luck with the beer bong theme next week. I never met a girl who could handle it. I barely could, often the beer decided to come out of my nose. But that was many years ago.
Glad your kids are so well behaved. Hope you never drink in front of them.
bill are you suggesting we refine more gasoline here, and then ship the gasoline? I ask because usa gasoline consumption is going down.
So you'd like to refine oil and ship the refined product? I don't see the logic. If this was a great model, why don't the saudis just ship gasoline?
"How on earth would exporting crude oil create jobs?" Think about this. Do you think there's be any Americans involved in getting oil out of the ground and on to a ship? Any Americans involved with maintaining the infrastructure, loading the ships, watching over the ship traffic? Any Americans involved in negotiating the prices, the shipments. Do you have any idea how explosive the petrol chemical industry has become as a result of the USA shipping petrol chemicals to markets we previously could not touch? Are you are the USA is now the lost cost producer of products such as PVC? Thank goodness we didn't shut down exporting of petchems.
As far as national security, you have to be kidding. If some mean country says "boo", you stop loading ships. Get real pb.
As far as making goods cheaper, do you think the average American family would prefer gasoline a $2, or $3 per gallon. Where might that extra dollar go? How about the supermarket, how about the kid's clothing store. Think those businesses wouldn't benefit from more sales, and hire staff to meet the demand. Economics is pretty simple: consumers want less expensive goods. The opposite, inflation, is a killer.
bill, is there anything wrong with exporting crude to asia? As far as jobs, exporting crude can create more jobs than those which might be lost, the idea being to open up a new channel and all that goes with it. It's more than just the crew of a foreign ship, it's all the Americans at home who see an expanding oil infrastructure. The USA exporting anything, even if toothpicks, is never bad. There is no threat to national security, we can turn off the export pipe at will, and we have something called the SPR.
Any time an economic barrier is removed, all sorts of good things occur.
stj - TNK definitely purchased the brokerage business. But two unanswered questions are at what price, and to a lesser extent, why did TK sell it? Not disclosing the purchase price of the brokerage goes right along with TNK's lack of transparency.
I'm not so sure about pb's numbers, I don't see how he is able to put a number to voyage revenues, as those revenues are dictated by the market and none of us can determine how that will look next month, or next year.
pb - I'm older than you - I myself was in that gas line filling my car. As far as lifting the Jones Act, we're not going to run out of oil, and certain people in Washington would love to take credit for the shale boom they tried to dismantle three years ago. Oil exports would create more jobs.
People incorrectly assume we've maxed out on fracking oil. Give it a while, they'll figure out how to get more per well.
TNK made some curious comments about the Jones Act not long ago. It's in their recorded notes, you'll find it.
charly, curious ... how often do you beat your dog? You take such offense when I criticize TNK. Last time I checked, shareholders own the company, and have a right to question the people running the company. In your world, every CEO is a genius ... the ones who get fired, the ones who go into BK, we'll forget about them.
Spot for VLCC and Suex have held up extremely well. Afra now in the tank. As far as ownership, I laugh when you ask.