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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Michael Tanner: [00:00:00] Thursday, we saw BP hold its kind of annual general meeting, which is the same thing as a shareholder meeting, but because they’re based in the London Stock Exchange is what they call it. If you do not recall, they have a 5% activist investor in them. It’s Elliott Management, who has basically been pushing them in the last year to make significant business increases. And part of what that plan was in February, BP came out and said they’re slashing their renewable spending and boosting its annual expenditures. On its core oil and gas business. That’s according to the CEO, Murray Entreclos, who used to be their former CFO when their old CEO who got caught fooling around with his assistant got axed. [00:00:39][39.6]

Stuart Turley: [00:00:47] Hello everybody, welcome to the Energy Newsbeat Daily Standup. This is the weekend edition, the weekly recap. The staff picks the best stories of the week and we are off and running. Please take a moment, read this to your pets, share it, give your kids a hug and be epic on this weekend. But we want to give Steve Reese and the team over there at Reese Energy Consulting a shout out. If you’re in the data center business, if you’re needing natural gas or you’re an oil tanker move, give them a call. Have an absolutely wonderful weekend.

Clean energy projects in the United States have been lost in the wind to the tune of 8 billion dollars. But Michael, how much cheaper will our electricity be if we didn’t use them? And I have a number that is coming to mind. Let’s go through some of these stats. Research suggests that 16 large-scale clean energy projects were canceled in early 2025 with about $7.9 billion. The exact number is yet kind of figured out. One of those was Frere Battery, which canceled at 2.5 billion. And I liked that project, Michael, because Frere battery was one of the few projects that actually the battery technology was allowed to be recycled. I understand subsidizing a little bit to get a new technology started if it helps the consumer and the environment. I’m disappointed this one is getting canceled. Bosch also canceled with a 200 million dollar hydrogen fuel cell in South Carolina. That one I think is a smart move. [00:02:30][102.5]

Michael Tanner: [00:02:30] No, I do think it’s a smart move. And you have been a friend of Fry Battery, not just because they came on the podcast. [00:02:35][5.0]

Stuart Turley: [00:02:36] No, I like the technology. I like recyclable battery technology. Right now, everything else is not there. And I want to go into some of the key points here. Warren Buffett said, Michael, in 2014 in an article from the Daily Caller, I will do anything. This is quote from Warren Buffet. I will do anything that is basically covered by the law to reduce Berkshire tax rate, Buffett told on an audience in Omaha, Nebraska this weekend. For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without tax credit. This has gotten us almost shut down, Michael, for us talking about this. It’s the powers that be did not like us talking like this. [00:03:27][51.3]

Michael Tanner: [00:03:28] It’s it’s true. And, you know, we’ve seen Trump come out in the last month or two and basically whack offshore wind in New Jersey and New York. And guess what? Well, guess what people are. And he hasn’t whacked offshore wind saying you can’t develop offshore wind. What he’s saying is there’s no more tax credits to do this. And guess where people are doing? Oh, well, we can’t build them anymore. It’s like, whoa, whoa. Wait a second. Wait, wait a second here. You’re telling me. That if the tax credit wasn’t there, you wouldn’t invest in wind farms. It’s not to take a tangent. It’s one of my beefs with all these oil and gas companies that raise money by saying, but it’s a tax deduction. It’s like, wait, wait wait wait, so I should invest in you just because it’s a tax deductions, is not because you actually are gonna make me some money on the back, wait a second here. So it’s the same way. [00:04:20][52.3]

Stuart Turley: [00:04:21] A tax deduction versus tax credit? Big difference. Well, no, no. Okay. Deduction credit… It takes financial profits to make a tax deduction, which is an investment, but a tax credit is theft. [00:04:34][13.0]

Michael Tanner: [00:04:34] Yeah, it works the same concept though, if you’re, if the, if, if okay, great. I’m going to spend a billion dollars and I get a deduct 500 million from that. But if now all of a sudden the deduction goes away, I wouldn’t build it. Well, because there’s no money in actually building. [00:04:47][13.2]

Stuart Turley: [00:04:49] Now, this is going to bring up two huge issues coming around the corner. It takes about $350,000 to $925,000 or more per wind turbine, Michael, to take them down and try to get them recycled or put the blades in a boneyard. There are 75,633 wind turbines in varying sizes on the grid in the United States right now. That’s a lot of money that is sitting there as a liability for all this land out here. I came up, and I’m going to throw a dart at this, and i’ve got a cost that if we did not have wind and solar on our grid we would be having about 44% cheaper prices. I got reasons for that number. So we’re gonna bookmark that number as we come in and write more numbers [00:05:44][54.7]

Michael Tanner: [00:05:45] Yeah, absolutely. Absolutely. And I just want to say this. This is what I tell everybody who asks me about different investments. If the investment metrics that somebody is telling you on a project that you’re looking at, ask them, does it include or not include the tax benefits? Because if they’re telling you the return includes the tax benefits, your next question needs to be, well, what is it without the tax benefit? And you’ll for seeing it go significantly down. Or if it still is within a range that you’re interested then you know that’s a good project to think about but too many times these people use tax deductions to juice the returns and when you strip them out it’s like well wait this project’s not gonna make any money [00:06:25][40.3]

Stuart Turley: [00:06:25] When they were when all of the wind of folks were talked about land reclamation They went they pulled a scooby-doo. They would not put land recclamation in there and said it’s not worth it So we got us a big problem [00:06:38][12.6]

Michael Tanner: [00:06:38] Energy oil giant BP is seen as a prime takeover target, is a blockbuster merger in the cards. Last Thursday we saw BP hold its kind of annual general meeting, which is the same thing as a shareholder meeting, but because they’re based in the London Stock Exchange is what they call it. If you do not recall, they have a 5% activist investor in them. I forget the name of them. I think it’s Elliott management. Yes, it’s Elliot management who is basically been pushing them in the last year to make significant business increases. And part of what that plan was, was in February BP came out and said they’re slashing the renewable spending and boosting its annual expenditures on its core oil and gas business. That’s according to the CEO Murray, Antje Kloss, who used to be their former CFO when their old CEO who got caught fooling around with his assistant got axed. I mean, it happens, you know, it’s unfortunate, but it happens. You know, this kind of U-turn has basically really brought up. And, you, know, this isn’t a new rumor, but a lot more people are chirping now about two things. One, this article points out of a relisting in the United States, you know, BP right now trades at a multiple relative to EBITDA. That’s less than its counterparties in its same peer group that would be listed on the U.S. Stock exchange. And I think that’s the interesting, interesting piece Their EBITDA multiple right now is about four to five times EBITTA, where they have portions of their business that could trade it 10 times EBITD, which is specifically their marketing business. I’m not the marketing business that we think of. They’re not selling social media management. I’m talking about marketing oil products, which if you need help marketing your oil products just call up our friends over at Reese Energy Consulting. So when you’re trading it three times or four times EBITDA, but there’s parts of your business that could trade at 10, and overall your core business could trade in a slightly higher multiple if you were listed in the U.S., maybe that’s something you consider. Well, then it brings up the second point of Should they just go ahead and merge with somebody? And we’ve all heard about the rumors of BP and shell merging. And I think there’s, there’s some legitimacy to that. I think you’re going to have a, I think I would argue that that’s more complicated than not mainly because of the UK regulatory system. You know, you think it’s hard. You think the FTC is scrutinizing mergers in the United States, but they’re scrutinizing them. In the UK. And what’s interesting is that the new head of the FTC following up Lena Kahn is about as a stickler on mergers. I mean, you haven’t seen an explosion of mergers right now because I think Trump is a little bit more populist than he is pure unabridled capitalist from the standpoint of they are concerned about too much consolidation in businesses. And so it could be the fact that they’re seeing that, but also here’s Here’s the rub. If they get listed in the United States, does that put a merger with Exxon or Chevron on the table? Ooh. Ooh, what do you think about that, Stu? [00:09:51][193.2]

Stuart Turley: [00:09:52] I think a merger would be fine from BP to Chevron or Exxon. I think it would be fined from a non-compete kind of a thing. But from a UK energy perspective, it is a nail in the coffin for them. And their energy policies have absolutely decimated the oil and gas industry. And we’re going to continue to see the decline of the UK and the EU. Under this kind of a policy. [00:10:23][31.1]

Michael Tanner: [00:10:23] Yeah, I mean, I think a merger makes sense because they have the ability to, you know, they’re, especially if they merge with somebody who already has an offshore business, there’s a lot of synergies there. I also do think it’s an extremely complicated merger to make because for a variety of reasons, for a variety. [00:10:41][17.6]

Stuart Turley: [00:10:42] Absolutely, but I’ll tell you the UK losing their entire oil manufacturing would be true. They’ve done it to themselves. So not only did they shoot themselves in the foot, the splatter caught all the citizens. [00:10:55][13.0]

Michael Tanner: [00:10:56] Yeah, we will be bidding. Newsbeat will be biding. I’m not going to quite say what our bid’s going to be, but we will be bidding to merge with them. We’ll, we’ll see what happens. [00:11:04][8.1]

Stuart Turley: [00:11:05] Trump targets the EPA endangerment findings after Supreme Court rulings. This is really a great story from issues and insights. And this one was really when you sit back and take a look. Trump moves to scrap the EPA endangerment findings, citing Supreme Court, rulings and lack of congressional. Okay. Regulating greenhouse gasses. I imagine the reversal would be accomplished over a course of at least a year and probably accurately through the conventional administrative process of notice in public, but things may get much more exciting and more quickly, as the author is saying here. The EF is a December 2029 determination by the Obama EPA that the emissions of greenhouse gasses harm the public health and welfare. And this is going to be huge in order to save money for not shutting down coal plants. It’s the particulate matter that is actually the pollution and having scrubbers and filters on there does make all the difference in the world so that clean coal is more clean than it used to be and that you do not have to put it into the CO2 is actually Plant food, last time we scientifically checked, one of the recent Supreme Court decisions listed in the executive orders is 2022 West Virginia versus the EPA. In that case, the court held that the Obama’s EPA 2015 clean power plan and ironic prodigy of the EF was unconstitutional. Under the courts. New adopted major questions doctrine the significant regulatory agency programs requires express congressional authorization. The regulation of greenhouse gas emissions from fossil fuel burning is an absolutely major question and congress never expressly gave the EPA authority to regulate greenhouse gasses. This is absolutely what we voted for. And this is huge. [00:13:25][140.5]

Stuart Turley: [00:13:26] And the, the article from rice dad energy did not have really that definition of what Mina was. And so I added the whole list of all of the operators that were there and what they basically have in their mounts that they help put and everything else to help make that a lot easier to go through. They are everybody from iraq national oil company the iranian national abu dhabi kuwait qatar algeria soundtrack national corporation of libya and oman but when we get into the story here from rice dad u.s. Tariffs had disrupted global oil supply chain leading to increase cost and promoting shifts in sourcing categories The oil field service companies are benefiting from these disruptions due to their localized supply chains and proximity to clients offering shorter lead times and competitive pricing. That is a huge understatement as it applies to the United States, which is steel for pipe. We’re talking all the other kinds of stuff. If you’re trying to put in new pipelines or anything else, this is going to be a big deal shortly. The Trump administration of terror regime intended to boost US manufacturing and plant punitive damages on Chinese manufacturing has disrupted multiple and supply industrial supply chains into the US with cascading effects across other regions for the middle East and North Africa. Regents oil field services are effect indirect, but may be significant if unmitigated by national oil companies with the U S turning more inward. These companies can pivot to sourcing to take advantage of foreign sources looking for new customers and particularly in China. So this is actually going to be very much like Miramar. I, I was sitting there trying to take a look at China visiting with how the export of. From Myanmar to China and the amount of oil that they produce there is very Malaysia. You sit back and take a look in Malaysia to China and you can all of a sudden count how much is being shipped from the dark fleet by looking at who is shipping and Malaysia showed up into new contracts as being a source for Iranian or Iraq oil going to China via that channel. So you sit back and kind of go. China is still going to be buying a lot of oil and this is going to make a huge difference. You also have the UAE, NA, NAO, NAOC, ABNOC have already expanded the use of integrated service contract growing from 35% to 47% on its onshore and offshore assets through So Pretty exciting stuff going on in the Middle East as taking advantage of new sales to China and their supply lines. [00:16:43][197.7]

Stuart Turley: [00:16:44] How would a nuclear deal with Iran impact the global oil markets? This has really been something I’ve been watching and when you sit back and take a look at the number of people speculating out there how this is going to happen, but it’s going, it could impact the Pope by potentially. One to two million barrels per day returning to the market after the sanction removal. Here’s where I have a little bit of a different take for investors, for the economy and everything else. We are not sure that OPEC plus committee has been able to actually keep production in line because their members have been over producing. Here’s the United States with the Democrats. And Republicans equally aligned in printing money. If we need money, we just go print money. If Iran, Iraq, Venezuela, or any of these other countries need money they print natural gas, they print oil by drilling, and then they sell it on the dark fleet. There’s an estimated uh, 1,200 Darkfleet ships out there right now. And so if there’s an iranian deal achieved will have a guarantee that they can remove their nuclear materials and will opaque be able to enforce a production cap to keep the price around eighty to eighty five and that’s where i firmly believe that saudi arabian needs that oil i want to give josh young a shout out. He is one of the head guys over there at Bison interest. And I tell you, he is a been on the podcast, absolutely respect him. And he’s got a great quote, the lower the oil prices go and the longer they stay there, the higher prices will subsequently rise. Well said, Josh. And as you go through the rest of the article here, I added in the article here on our sub stack, the energy newsbeat.substack.com. You can go in and see that research suggests a nuclear deal would increase global supply, like I mentioned, one to 2 million barrels per day. OPEC might not be able to, but when you sit back and take a look at this, unless there’s no guarantees that we get the nuclear material out of their hands, I think it’s a bad deal. This is not going to be like a president, Barack Obama dropping off billions of untraceable cash. To his buddies over there, that is not gonna happen in this term. [00:19:28][163.3]

Stuart Turley: [00:19:28] This is an amazing story from Doug Sheridan on LinkedIn. David Blackman follows him, I follow him, and he is very well respected for his energy knowledge. The Wall Street Journal posted out, Texas is facing a crunch in its electricity supply because of a massive build out of heavily subsidized wind and solar. Wait, you ask how much heavily subsidized? More than $130 billion has flowed into renewable resources and cannot be counted on to produce electricity when in need. Texas found this hard way in 2021. The Texas legislator has responded by requiring renewable energy plants to secure their own firm backup supply. House Bill 1500 passed in 2023 introduced firming requirements that applies only to new power plants starting in 2027. However, that’s too little too late. So there’s a new bill coming out. A renewable investors will cry foul if 715 passes, but the new lavish subsidies were controversial could be eliminated at any time. They assumed the risk. After Senate passage, SB 715 now faces an uncertain path in the Texas how the stakes are high. And considering the Texas legislation and RINOs that are in there, it may or may not. Doug puts out two big points here. It’s amazing how many Texas leaders have gone along with a bizarre anti-dispatchable that ERCOT and PUCT appear to have a comfortable with. Until the subsidies stop, and then Texans will have to eventually pay up for the state’s unfortunate experiment. Let’s go up to a quote here in the article that I added in, and the quote is, a grid requires fiscal responsibility and physics will require nothing less. Anything less than that will result in failure that is an amazing point when you sit back and take a look at how the grid ercot grid is broken out natural gas is 40 to 4 to 50 percent of ercot’s grid capacity wind is 20 to 26 coal is about 15 to 20 Nuclear is about 10 to 11 percent, solar is about six to eight, and power and storage and other is about one percent. So when you sit back and hydro and biomass is also about less than one percent When you take a look at how much cost savings the Texans could realize is if you take a look, at $130 billion invested into renewable, non-sustainable energy of wind and solar, that’s a lot of money that you could put into power. Plants that are natural gas, low emissions, or other types of information. It’s just a mind boggling amount of information here. Excellent story from Doug Sheridan. [00:19:28][0.0]

[1148.8]

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