Speaker: Pickering front and center on energy

Dan Pickering

WHEN: 1:30 p.m.

WHAT: Energy Investment — Global View”

WHO: Dan Pickering, Energy Financial Analyst — Tudor, Pickering, Holt & Co.

Dan Pickering, Co-President and Head of Securities, founded Pickering Energy Partners, Inc. in 2004, which combined with Tudor Capital in 2007.  Prior to founding the firm, Pickering served as Head of Research at Simmons & Company, International. 

He also gained buy-side experience with Fidelity Investments and industry experience at ARCO Alaska, Inc.  He holds a BS in Petroleum Engineering from the University of Missouri and an MBA from the University of Chicago.

When the price of gas goes up, you can usually find Dan Pickering somewhere on TV talking about it.

Pickering is a go-to guy for network and cable news shows, providing instant expert analysis on energy markets.

Pickering is a vice president at Houston-based Tudor, Pickering, Holt & Co., a team of research and financial analysts.

“When energy is front and center, I spend a fair bit of time in front of the camera,” he said recently. “There’s a lot of curiosity about the oil patch, so it’s a relatively frequent part of my job, but at the end of the day, I spend a lot of time thinking about how energy issues affect energy companies and energy stocks.”

Pickering is likely to outline a fairly bullish oil price forecast during his talk at the Energy Forum & Expo on Feb. 25, and should also touch on natural gas production.

“We’ll outline why natural gas prices aren’t going to be much worse than they are today, but probably have a ways to go before they get better,” Pickering said. “What you see is what you get for natural gas prices in 2011.”

The price gap between oil and natural gas is pushing more producers to pursue greater “liquids-rich” activity, Pickering said.

Producers are exploiting the same technology — horizontal drilling — that yields gas from the tight rocks of the Piceance. They’re using it to drill for oil in new fields, now that high oil prices can justify the drilling costs.

“As we look at the natural gas environment across the U.S., the shale rush that happened in 2007 and 2008 is continuing to play out with a lot of drilling activity still ongoing to hold leases and that’s driving a lot of incremental gas supply,” Pickering said.

“So you’re getting a lot of supply out of the traditional basins and then the advent of what I would call ‘liquid-rich’ but still quite gassy plays.”

Producers are finding a lot of gas as a byproduct of the more lucrative hunt for oil, thereby contributing to an abundance of gas supply.

“For the stand-alone gas producers, they’re a victim of their own industry success and high oil prices,” Pickering said.

President Obama’s recent State of the Union address offers some optimism about the future of natural gas, however.

“I thought there was a glimmer of hope in his comments when talked about cleaner energy sources and 85 percent of power to come from cleaner energy. The president mentioned natural gas, and that was a shift because natural gas has been lumped together with oil in the minds of Washington.

“He gave a hint that natural gas is going to get less animosity out of Washington, and maybe a little bit of support.”

Meanwhile, the debate about the nation’s energy mix and increasing our use of renewable forms of energy remains more of an academic exercise than a precursor of things to come.

“Realistically, our view is that hydrocarbons will continue to be the primary energy source because they’re cheaper. It’s cheaper to burn coal and natural gas to produce electricity than to generate it from wind and solar,” Pickering said.

“Our view would be that until prices change dramatically and force the consumer to change behavior, this will remain a hydrocarbon economy.”

Similarly, a pricing mechanism for carbon would be an unpopular political cause in a slumping economy.

“Taxing carbon is great from a green perspective, but pretty awful for the consumer,” Pickering said. “Carbon feels like it’s a 2013 issue once we’re past the next election cycle.”

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