Maybe fossil fuel pipelines aren’t such a lucrative business after all? Funny how this Spectra downgrade comes right after the big announcement about EPA proposed methane rules. Can Spectra Energy CEO Greg Ebel explain this away to investors three weeks from now? How about OPEC driving the price of gas down and energy deals among U.S., China, and Russia tanking the U.S. LNG export market? Ebel’s got some ‘splainin’ to do.

Faye Duncan wrote for Dakota Financial News 16 January 2015, Spectra Energy Corp. Cut to “Hold” at Tudor Pickering,

Tudor Pickering cut shares of Spectra Energy Corp. (NYSE:SE) from an accumulate rating to a hold rating in a research report sent to investors on Wednesday morning, TheFlyOnTheWall.com reports. The firm currently has $32.00 price target on the stock, down from their previous price target of $42.00.

Several other analysts have also recently commented on the stock. Analysts at Jefferies Group lowered their price target on shares of Spectra Energy Corp. from $39.00 to $37.00 and set a hold rating on the stock in a research note on Friday, January 9th. Analysts at Zacks reiterated a neutral rating and set a $40.00 price target on shares of Spectra Energy Corp. in a research note on Tuesday, November 18th. Finally, analysts at Bank of America downgraded shares of Spectra Energy Corp. from a buy rating to a neutral rating in a research note on Monday, November 3rd. Eight investment analysts have rated the stock with a hold rating and two have given a buy rating to the stock. Spectra Energy Corp. presently has a consensus rating of Hold and an average target price of $40.11.

What went up in the summer has been coming back down since:

Spectra Energy (SE) and Spectra Energy Partners (SEP)

Spectra Energy SEC Form 10-K filed 28 February 2014, page 30, I added the emphasis:

In the United States, climate change action is evolving at state, regional and federal levels. The Supreme Court decision in Massachusetts v. EPA in 2007 established that GHGs were pollutants subject to regulation under the Clean Air Act. Pursuant to federal regulations, we are currently subject to an obligation to report our GHG emissions at our largest emitting facilities, but are not generally subject to limits on emissions of GHGs, (except to the extent that some GHGs consist of volatile organic compounds and nitrous oxides that are subject to emission limits). In addition, a number of Canadian provinces and U.S. states have joined regional greenhouse gas initiatives, and a number are developing their own programs that would mandate reductions in GHG emissions. Public interest groups are increasingly focusing on the emission of methane associated with natural gas development and transmission as a source of GHG emissions. However, as the key details of future GHG restrictions and compliance mechanisms remain undefined, the likely future effects on our business are highly uncertain.

Maybe we’re seeing some of those effects already.

Break out the popcorn! The comment deadline for the EPA proposed methane rule is Monday 9 February 2015, and the preceding Thursday Spectra CEO Greg Ebel will explain it all!

Spectra Energy press release via PRnewswire 9 January 2015, Spectra Energy and Spectra Energy Partners to Review Business Outlook and Three-Year Financial Plan on February 5,

Spectra Energy Corp (NY SE: SE) and Spectra Energy Partners (NYSE: SEP) will discuss their business outlook and 2015-2017 financial plan during an analyst/investor meeting on Thursday, February 5, 2015.

Chief Executive Officer Greg Ebel, Chief Financial Officer Pat Reddy, and other executive leaders will deliver remarks and then address audience questions.

The presentation is scheduled to begin at 8:30 a.m. ET and will be webcast via the Investors Sections of www.spectraenergy.com and www.spectraenergypartners.com. Interested parties can also call into the discussion by dialing 888-252-3715 in the U.S. or 706-634-8942 internationally. The conference ID is 47700640 or “Spectra Energy 2015 Plan.” An audio replay will be available until 5 p.m. ET, May 5, 2015, by dialing 800-585-8367 in the U.S. with the above conference ID. The international replay number is 404-537-3406.

Already back in March 2014, Greg Ebel was struggling to explain why his company didn’t have more pipelines deployed, even though some of the news media redacted the part about the export market being the real customer. Maybe he’d like to explain about those three already-permitted LNG export operations right where the Sabal Trail pipeline leads in Florida?

Maybe he’d like to explain how not only is Spectra building a pipeline to an LNG export terminal in British Columbia, but in its Canadian environmental assessment it said it might put two pipelines on the same right of way? What would stop Spectra from doing the same thing on the Sabal Trail right of way?

Maybe Spectra’s CEO would like to explain how it can claim to be a sustainable company when it fracks watersheds for a greenhouse gas 20 times worse than carbon dioxide and then gouges huge rights of way under rivers and through forests and fields, taking people’s lands for Spectra’s leaky pipelines?

Analysts think Greg Ebel’s got some ‘splainin’ to do.

-jsq

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