Daily Archives: February 22, 2017

A little more than a month after seismic blast testing for oil and natural gas was stopped offshore of South Carolina, exploration companies are gearing up for a new try.

Conservation groups are gearing up to fight again. This time, the battle will focus on jobs and the economy, they say.

A dozen anti-drilling advocates met Tuesday in Charleston to discuss expanding the opposition. They may look inland for more support in the vein of the massive coastal protest that in 2016 helped derail plans for testing and drilling.

Frank Knapp, founder of the anti-drilling Business Alliance for Protecting the Atlantic Coast, said he has heard the exploration industry is planning to approach the federal Bureau of Ocean Energy Management about reversing a testing permit denial adopted during the last days of the Obama administration.

Asked about that, the pro-drilling exploration National Ocean Industries Association president Randall Luthi said, "Industry continues to have interest in updating grossly outdated offshore resource estimates so that future decisions are based on sound science rather than political hyperbole."

In seismic testing, powerfully loud air guns are fired underwater every 16 seconds to read echoes from the bottom geology. Conservationists oppose them because of the potential to disorient and injure marine animals. Business groups have joined the conservationists out of concern for the industry's impact on multi-million dollar coastal tourism revenue.

Luthi and other industry representatives say advances in drilling technology have made the operations safer, and that seismic surveys have taken place for a half-century with no direct evidence it harms sea animals, commercial fishing or tourism. They tout the economic benefit and potential job creation of the work.

Drill or don't drill cuts to the heart of coastal life, where interests are divided between exploring for potential economic benefit or restricting exploration to protect marine life and a billion-dollar tourism economy. Residents widely oppose both testing and drilling as a quality-of-life issue.

The conservation groups that met Tuesday came from Florida to New Jersey, and included local groups such as Stop Offshore Drilling in the Atlantic. They reflected an opposition that grew to include thousands of residents and nine of every 10 coastal municipalities in those states 23 in South Carolina alone.

Knapp's group represents more than 35,000 businesses and 500,000 commercial fishing families from Maine to Florida.

Former Gov. Nikki Haley was part of a coalition of governors who worked largely behind the scenes with industry lobbyists to urge federal officials to open the Southeast coast to oil and gas exploration. Gov. Henry McMaster has said he opposes it. State governors are given a say in BOEM decision-making.

The battle could be the first of any number the conservation groups expect as administration and congressional efforts are made to rescind laws and restrictions set by the Obama administration battles they expect will come down to legal challenges.

The groups "are more fired up than they were a year ago," said Samantha Siegel of Oceana.

"I think the business voice becomes even more important" in the current political environment in Washington, D.C., said Knapp, who did not take part in the Tuesday meeting but said the effort is valuable. "This is not something that you can say, 'We'll fight them next time.' There will be no 'next time.' "

Reach Bo Petersen Reporter at Facebook, @bopete on Twitter or 1-843-937-5744.

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Offshore drilling opponents re-gear for new round of battles | News ... - Charleston Post Courier

US grid can handle more offshore wind power, cutting pollution and power costs Science Daily Injecting large amounts of offshore wind power into the U.S. electrical grid is manageable, will cut electricity costs, and will reduce pollution compared to current fossil fuel sources, according to researchers from the University of Delaware and ... and more »

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US grid can handle more offshore wind power, cutting pollution and power costs - Science Daily

Hornbeck Offshore (NYSE:HOS) shares tanked following the company's recent quarterly report. The numbers themselves were not surprising given the horrible market environment - the company reported a net loss of $0.53 per share on revenues of $41.9 million.

To get a quick picture of how bad things are, revenues declined by 52.8% since the fourth quarter of 2015 and by 19.3% since the third quarter of 2016. As a result of poor market conditions, the company had to stack 25 more vessels.

As I stated above, the results themselves are not a surprise at all. Perhaps, seeing actual numbers was a pain for Hornbeck Offshore investors, and this partially caused the post-earnings sell-off.

Also, the stock was elevated after the post-OPEC deal rally, although the deal changed nothing yet for the offshore drilling industry as was highlighted many times during this earnings season (read here, here and here).

However, the most important factor for any company is the outlook, and the outlook presented by Hornbeck Offshore management was just horrific.

Here's what Hornbeck Offshore had to say:

"We project that even with the current depressed operating levels, cash generated from operations, together with cash on hand, should be sufficient to fund our operations and commitments at least through to our current guidance period ending December 31, 2018.

However, absent improved market conditions, we do not currently expect to have sufficient liquidity to repay our three tranches of funded unsecured debt outstanding that mature in fiscal years 2019, 2020 and 2021, respectively, as they come due, unless such debt is refinanced or restructured.

Refinancing in the current climate may not be achievable on terms that are in line with our historic cost of debt capital. We are fully aware of the challenges of current market conditions are presenting to all offshore oil and gas industry and continue to actively review our capital structure and assess our strategic options, as we consider plans to ensure the long-term viability of Hornbeck Offshore".

In the previous report, the company warned investors that it was going to assess strategic options, but the language was softer. Now Hornbeck Offshore presented the big picture to investors - the company will have no money to pay debt in 2019 and will have to restructure its debt.

I would like to highlight that it does not even matter for Hornbeck Offshore if the industry rebounds by 2019 or not. The rationale for this statement is that Hornbeck Offshore management believes that it will be necessary to address the capital structure long before 2019. As always, concessions from lenders mean big concessions from shareholders.

Judging by Hornbeck Offshore comments, the company will try to push maturities as far as possible as it does not see any recovery coming soon:

"Earlier in this cycle, the industry mantra was lower for longer. The message we have recently been hearing from our customers, almost uniformly, is that they now see oil prices as lower forever. They no longer view this as a U-shape recovery, but an L-shaped recovery, or so we're told []

Our customers are telling us, they're not going to FID or sanction projects in deepwater. I mean, this is what they're telling us, $40 a barrel. They're going to have to justify $40 a barrel, not $50, but $40".

Here's what we see from this and what the market has so far failed to appreciate in both OSV and OSD stocks.

No matter what the current oil price is, the breakeven bar for projects is set low because oil producers don't want to be trapped in capital-intensive endeavors if oil goes below $50.

Once again, I remind that it does not matter now if they are right or wrong in their evaluation, because they will act upon their views and this means little demand for OSD and OSV industries.

The year 2017 is going to be bad for the industry and for Hornbeck Offshore. The company will likely see its revolving credit line go from $200 million to $75 million as it plans to elect interest coverage holiday at some point during this year.

There is no cash crunch as the company had $217 million at the end of 2016, but this number will trend down as the year progresses.

The deal with creditors won't be easy to reach as highlighted by the problems of Hornbeck Offshore's peer, Tidewater (NYSE:TDW).

Tidewater's shareholders are already on the verge of a wipeout. The situation for Hornbeck Offshore shareholders is better, as the company did not ran into any covenant and does not depend on lenders' good will.

Anyway, proactive attempts to deal with debt mean nothing good for shareholders unless the company can suddenly gain access to capital markets.

At the end of 2016 - beginning of 2017, a group of offshore drillers, namely Transocean (NYSE:RIG), Rowan (NYSE:RDC), Noble Corp. (NYSE:NE), Ensco (NYSE:ESV) and Atwood Oceanics (NYSE:ATW) were able to raise money through debt and equity.

The window of opportunity was opened by the OPEC/non-OPEC deal, but I believe that it has already shut down as no tangible evidence of any improvements on the offshore drilling front materialized after the deal.

Also, players with financial problems like Seadrill (NYSE:SDRL) or Ocean Rig (NASDAQ:ORIG) were not able to raise money during this fortunate period. Yes, Seadrill is in restructuring negotiations right now, but even its founder is not willing to inject money via equity. So, for weaker industry players like Hornbeck Offshore or Tidewater the market was never really opened.

All in all, Hornbeck Offshore still has time to review its strategic options and I expect that the company will not hurry.

Any negotiations with creditors will take long as evidenced by Tidewater and Seadrill restructuring negotiations. Given the uncertainty, the stock will be highly volatile and present trading opportunities on both long and short sides.

However, the general direction will be to the downside as the OSV industry is the last one in the supply chain to benefit from rising oil prices, and current oil prices are not sufficient enough to bail out the OSD industry, the client of the OSV industry.

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a short position in HOS over the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.

Originally posted here:

Hornbeck Offshore Services: Too Many Problems Will Drag The Stock Further Down - Seeking Alpha

Published on February 21st, 2017 | by Joshua S Hill

February 21st, 2017 by Joshua S Hill

Spanish electric utility Iberdrola announced it has completed the installation of the first of 70 5-megawatt wind turbines at the 350 megawatt (MW) Wikinger offshore wind farm off the coast of Germany.

Iberdrola announced on Monday the completed installation of the first wind turbine, the first of 70 5-MW Adwen wind turbines known as WK16. The turbines are being installed by Fred OlsensBrave Tern, one of two self-elevating, self-propelled jack-up vessels dedicated to installing offshore wind turbines.

Upon completion, the Wikinger offshore wind farm will have benefited from investments totaling around 1.4 billion, and is expected to generate enough clean electricity to power more than 350,000 households.

We are delighted to reach yet another key stage of Wikingers construction programme which is testament to the hard work and dedication of the entire project team, said Jrgen Blume, Head of Iberdrola in Germany. Our Wikinger project is progressing well, and we are on target with our plans for full export at the site later this year.

While this is something of a small project, in the grander scheme of things, the involvement of theBrave Tern was enough to capture my interest. TheBrave Tern is one of two vessels (along with theBold Tern) that are able to elevate themselves off the surface of the water, stabilizing themselves off massive jacks from the ocean floor. The vessels are able to work in water depths ranging from 5.5 meters to more than 60 meters, and are able to manage a typical payload of up to 7,600 tonnes.

Buy a cool T-shirt or mug in the CleanTechnica store! Keep up to date with all the hottest cleantech news by subscribing to our (free) cleantech daily newsletter or weekly newsletter, or keep an eye on sector-specific news by getting our (also free) solar energy newsletter, electric vehicle newsletter, or wind energy newsletter.

Tags: Brave Tern, Fred Olsen, Iberdrola, Wikinger, Wikinger offshore wind farm

Joshua S Hill I'm a Christian, a nerd, a geek, and I believe that we're pretty quickly directing planet-Earth into hell in a handbasket! I also write for Fantasy Book Review (.co.uk), and can be found writing articles for a variety of other sites. Check me out at about.me for more.

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Iberdrola Completes Installation Of First Turbine At 350 Megawatt ... - CleanTechnica

Amnesty International has heavily criticised the federal government's policy of offshore detention of asylum seekers in a report released Wednesday which analysed human rights abuses in 159 countries.

In the report, the activist group claimed that Australia "maintained its abusive offshore immigration processing regime" on Nauru and Manus Island in Papua New Guinea.

It also highlighted what it called the government's "refusal" to honour an offer with New Zealand to annually resettle 150 refugees from Nauru and Manus Island.

"The Australian government's policy of 'processing' refugees and asylum seekers on Nauru involved a deliberate and systematic regime of neglect and cruelty, designed to inflict suffering: the system amounted to torture under international law," the report said.

"It minimised protection and maximised harm and was constructed to prevent some of the world's most vulnerable people from seeking safety in Australia."

The report marked the second consecutive year the activist group had criticised the federal government on this issue.

The same report released in 2016 labelled the practice of offshore processing as "shameful" and "one of the worst in the world".

Tim O'Connor, spokesperson for the Refugee Council of Australia, said it was alarming the way the Australian government was treating people seeking asylum.

"It's an enormous concern to Australia, it's costing tax payers billions of dollars and it's destroying the futures of many innocent people."

Mr O'Connor said Australia's current policies were undermining an effective global approach to managing human displacement.

"We're wasting billions of dollars harming people, locking them up on Nauru and Manus, locking them up in Australia's detention centres, keeping people here in limbo in temporary protection.

"Meanwhile that money should be utilised to support countries of first asylum so that when people flee from Syria or the Rohingya flee from Burma - because of extreme violence in those countries that's being perpetuated against those people - that they can live with dignity."

The report also accused the justice system of continuing to fail Indigenous people, particularly children, with high rates of incarceration, reports of abuse and deaths in custody.

It said Indigenous children were 24 times more likely to be detained than non-Indigenous children.

Amnesty's national director Claire Mallinson said "that's an issue the whole of Australia should be shocked about".

The report found that despite the recommendation by the UN Committee on the Rights of the Child that the international minimum age of criminal responsibility should be 12, the age was 10 throughout Australia.

Mrs Mallinson said nearly three quarters of them were Indigenous children.

"So we're calling on the Australian government, the Prime Minister in particular, to make this a priority area."

The report referenced leaked footage last year that exposed abuse and other ill-treatment of children in juvenile detention in the Northern Territory.

"And we are calling on the government that when the royal commission into the horrors that we saw at Don Dale is finally released in August, that that will be the springboard to a national plan," Mrs Mallinson said.

On a global scale, the Amnesty report painted 2016 as a year in which "unrelenting misery and fear" was brought down on innocents by governments and armed groups.

"Large parts of Syria's most populous city, Aleppo, were pounded to dust by air strikes and street battles, while the cruel onslaught against civilians in Yemen continued," it said.

"From the worsening plight of the Rohingya people in Myanmar to mass unlawful killings in South Sudan, from the vicious crackdowns on dissenting voices in Turkey and Bahrain, to the rise of hate speech across large parts of Europe and the USA, the world in 2016 became a darker and more unstable place."

Amnesty also chastised UN member states over what it called their failure at September's summit for refugees and migrants.

"While world leaders failed to rise to the challenge, 75,000 refugees remained trapped in a desert no man's land between Syria and Jordan."

The report also panned US President Donald Trump, claiming his rhetoric during last year's election campaign was "divisive" and "poisonous".

"His election followed a campaign during which he frequently made deeply divisive statements marked by misogyny and xenophobia, and pledged to roll back established civil liberties and introduce policies which would be profoundly inimical to human rights," the report said.

The report also accused former US President Barack Obama of leaving a legacy of "grievous failures to uphold human rights".

Continued here:

Amnesty pans Australia over offshore detention, Indigenous incarceration - SBS

Children detained on Nauru hold up signs in April 2016 protesting Australias offshore immigration detention system.

The royal commission into child sexual abuse is to hold limited public hearings on Australias immigration detention regime on Nauru and Manus Island.

The royal commission had initially declined to conduct investigations into Manus and Nauru because of jurisdictional concerns about the scope of the inquirys powers. Legal groups had urged the royal commission to examine Australias offshore immigration detention regime, outlining legal advice that Australias institutional response to allegations of abuse were within its power and terms of reference.

The commission appears to have partially adopted this approach, announcing the limited public hearing into the Australian governments response to report of a child protection panel convened by the immigration minister, Peter Dutton.

In a statement issued on Tuesday, the royal commission said its final scheduled public hearing in March would examine the Australian governments response to the report.

On 14 November 2016 the royal commission announced a series of public hearings to be held in Sydney to inquire into the current policies and procedures relating to child protection and child safety of various institutions, the statement said.

It said the hearings would include: The response of the commonwealth government to the recommendations of the child protection panel in its report dated 11 May 2016, Making Children Safer the wellbeing and protection of children in immigration detention and regional processing centres.

The child protection panel identified serious inadequacies in Australias child protection framework in the immigration detention system on Manus and Nauru. It found almost half of the responses to reported incidents of child abuse were inadequate and the immigration department was unsure of the number, nature and severity of incidents.

The panel made a series of recommendations including to improve categorisation of incidents, to require service providers to deliver accurate and complete incident reports, and to ensure inquiries were not finalised without all available facts and an effective response.

There has been renewed focus on the asylum seekers and refugees held on Nauru by Australia after the Guardians publication of the Nauru files, which detailed thousands of incident reports from the islands detention facility until October 2015.

A Senate inquiry is also under way into serious allegations of abuse and assault on Nauru and the department is facing increasing pressure to release information about incident reports, as well as healthcare information for asylum seekers and refugees on the island.

The royal commissions limited hearings will still not fully examine the detention regime on Manus Island and Nauru. They will occur as part of a set of hearings into other areas of government responses, including the defence department and the management of working with childrens checks.

The commission has made substantial inquiries into the onshore immigration detention regime, but declined to hold public hearings.

The hearings will begin in March.

Contact Paul Farrell at paul.farrell@theguardian.com or via the secure messaging app Signal on +61 457 262 172

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Child abuse inquiry to hold limited public hearings into offshore ... - The Guardian