MSB is locked in providing iron ore to the great lakes. Unless steel billets are imported and shipped to the Great Lake area at a price advantage, MSB will be competitive.
US steel is not competitive when the finish steel is made with US labor. The example is the San Francisco bay bridge. The steel was Chinese and was shipped to San Francisco ready to install. The US labor which was union, was kept at minimum.
This situation is particularly true on all US Coastal area. Inland and particularly great lakes, US steel can compete even with union labor. The transport is the added cost that is in favor of US steel therefore MSB iron ore.
The largest importer of iron ore is China. China economy is on a down spin. Iron ore competition has to be first from Brazil for the East Coast and GOM. Australia as to be the competition for the West Coast. Getting imported iron ore to the Great Lakes must pass by the St Laurent. Expensive proposition.
MSB may be up the 10%, especially since the Locke is open!
So far the Crack spread is $2.00 down the crack spread of before the crash, September 2014. The September 2014 distribution was $1.11.
$.80 distribution sound right, I would go for as much #$%$90.
I have 2015 Q2 at $14.91. I start the quarter 30 days before the xdate. I believe it take 30 days for management to come up with an approved distribution by the BOD. So far the Q3 2015 looks very good, $22.30, Q3 has only 11 days into the Q3.
The crack spread value used for Q2 distribution was stopped around 30 days before Xdate. The final date I used for Q2 was July 14 and the crack was $17.01. It takes time to process all the data get it approved by the BOD and get it publish 7 days before the Xdate. So 30 days before the Xdate is OK.
I had Q1 at $12.87. The future Q3 crack spread, so far is $21.32. I follow NTI, ALDW and CVRR and all are in the twenties so far for Q3. By the way, I use the 3.2.1. Crack Spread published by the EIA every day.
There was a 30 days turnaround that not only was maintenance but was also to modify the Big Spring refinery process, not too long ago. Today Big Spring can process the no spec WTI as well as WTS. I do not believe in a turnaround in the middle of the summer season.
The Xdate should be August 14. The data used for this distribution is closed 30 days before Xdate. It does take time to prepare the K8 required and it publication 8 days, or so, before Xdate.
Some believe that this market does not behave as in past years. Not too long ago the average owner of stock would keep it 6 years. Today it is more like 6 month. This is why this market is so volatile. I still believe in a $1.00 distribution give or take 10 cents. This market requires to have more and more nerves!!
The futures of Excelyte reside in the O&G drilling and H2S management. According to IEVM management each well uses 25,000 to 40,000 USD of Excelyte. Multiply these figures by the number of wells and you get a lot of Excelyte to produce. Naturally Excelyte is mostly water that is processed to get Excelyte. I expect a fraction of a dollar profit per USG. At $.01 x 25,000 x 171= $430,000. I think this new management is on the right track. We could see 1,000 wells under service by the end of the year. As the reputation of Excelyte grows, the number of wells will grow as well. In the O&G business reputation is everything.
I am no expert but any MLP or trusts or stock inside an IRA is free from Capital Gain. The only possible tax is the EBITDA. My understanding is that the tax starts for $1000 EBITDA or more.
I have to qualify the statement that IRA is not taxable. It is as long as you do not take money out. The tax is on the IRA distribution which becomes part of your total revenue. If you keep your retirement revenue below the minimum taxable amount, you stay tax free. It is up to you to set up your IRA distribution level, to minimize your taxable revenue.
This is not unusual. Delek has completed the majority stock purchased of Alon Israel. I would not be surprise if ALDW becomes a 2 refineries MLP! If this happen it will be by summer end!
Now that the dilution has passed the BOD, no one has comment?? My comment is: I am hopping the 200,000,000 new shares roughly $1.2 million will be used to expend the Excelyte production units in new prospective O&G field tainted with H2S. The latest disclosure from IEVM management is that 174 wells are under Excelyte treatments. This new capital should make investments in new O&G fields easier? Should the number of new wells under treatment no increase, Excelyte is not working or this management selling model is not with it. This will be the time to re-evaluate IEVM.
Under the present situation refiners are the best choices. I have to qualify refiners: The refiners off the GOM such as ALDW are well situated to get descent discounts. The WTI and WTS are over produced and the pipeline flow rates are not enough to accommodate the production. ALDW Big Spring refinery is especially well placed to get excellent discounts because it location near Midland TX.
ALDW Big Spring has modified it process and is able to use WTI or WTS. This makes ALDW, in my view, a good investment. NTI is located in Minnesota and get its discount from the North Dakota production overflow. NTI has changed daddy, I believe WNR, need to understand what WNR wants to do. VLO is on the GOM and has invested $3 billion in modifying its 3 refineries to use WTS. The Brent was a better deal, because the API degree favored the production of more diesels. Diesel means export and good profits. HFC is another possibility.
Sound like IEVM has finally hired an O&G experience individual as sales manager. This means that Excelyte will be the center piece in the marketing strategy.
O&G business is a closed in society, many CEOs are alumni of a few universities. The line managers know each other’s or know of each other’s. The drilling business is the same, closed in society.
Also, looks like the 200,000 new shares have been sold. The volume has been high this week! May be we will see an bounce back to $.08 soon.
I agreed that if you have more than one MLP in an IRA all UBTI cumulate. On the question of converting WPZ to WMB it will take place within the IRA. Since all assets stays within the IRA there will be no taxable amount until the IRA owner makes a distribution.
This UBTI, I understand, get higher with time. Since the WPZ was purchased in 2009 there may be some UBTI. I like MLPs as an investment, I hope that these 2 MLP buy out will not become a trend. MLP is a way to generate capital that otherwise would be a bank loan. I believe MLPs to be a good way to stimulate the economy. We need that!
Yes the 200 million are authorized; looking at last March Q K8 IEVM has a deficit. Cannot go on much longer before these 200K shares are on the market??
The Gulf Oil CEO in an interview has stated that the saving per year with delivery 18 wheelers was $20K per truck. Truck engines have to be overall every 7,000 to 8,000 hours of driving. The extra cost of up grading to a LPG or DNG engine is amortized in the first year.
DNG is the new fuel, Dual or Diesel Natural Gas engine. Natural gas does not explode under pressure as diesel can. So the DNG engine introduces in the cylinder a very small quantity of diesel as the piston applies pressure. The diesel blows under pressure and light up the natural gas.
It is understood that 6 MMBtu of natural gas equal 1 barrel of crude. The Henry Hub natural gas is $2.55 per MMBtu whereas the WTI is $53.38 (6/9/2015) $2.55 x 6 = $15.3. This is a 38% saving. Even with the power loss of 20% between diesel and natural gas, we still have a 30% saving. Conversion is a win win.
I believed a dilution would take place with 200 million new authorized shares. The plus is that a new management is at work. The goal is to invest in O&G H2S market. The competition to control H2S is putty much chlorine which is more expensive as a chemical but also to dispose of.
The negative is that the oil & gas market is down, so only the sweet spots wells are getting attention. I would expect the number of new wells under treatment would slow down, especially that fewer drilling rigs are working. The lowest share price has been $0.03, I believe $0.05 should be the bottom . I still believe in the H2S potential.
I hold a bunch of ALDW, and so far so good. If you are investing in O&G what are the choices you have:
E&P are down because the prices are down. These prices will stay down for sometimes. When they start to go up it will be very slow.
The pipelines stock are an alternative, their earnings are fee based. The price of the oil or gas does not matter. The quantity of crude or gas dictates the earnings.
The refiners off the GOM are the best way to make a profit. Their profit base is the Crack Spread. So far this quarter the Crack for ALDW, NTI and CVRR average $17.85. I am using the EIA data but these 3 MLPs have discount because of the over production and their location inland away from the GOM. In the O&G play these are the most promising.
NTI as well as ALDW are a MLP with assets limited to 1 refinery. These refineries are totally dependent on Crack Spread and more particularly discounted to the crude oil price. These refineries are inland, away from the GOM. The discounts are totally dependent on the pipeline trough put going to the GOM. The case of NTI is based on the Minnesota gas stations; ALDW is dependent on the 200 plus gas stations in Texas, New Mexico. NTI depend on the Bakken discount price where as ALDW depend on the Eagle Fort Midland WTI production.
So have your pick, NTI is a good potential. I have made a killing with ALDW. Timing is essential versus xdate. The down side with these MLPs is a fire in the refineries. You cannot see one coming. When it comes, the units drop like a brick, you have to be following these MLPs every days, all the time.
There is always a bounce 30 days, or so, before xdate. Sometime it is up, sometime it is down. The quarter it should be up?