British Energy Share Discussion Threads

[nicholas_collier] 19/5/2006 12:08

World markets may have fallen, but looking at the FTSE, it was cheap even at 6,100 with shares trading at 12x earnings. Surely there is a serious bull looming behind all this. Shares will be back at 15-17 times earnings. It may take a while but historically it will happen. The FTSE will easily go past the 8,000 mark in the next few years. I took out FTSE futures yesterday at 5659. I am going to make a lot of money. A small rise in U.S. infrlation causes a 8% fall. The fundementals do not support this fall.

The bears are mental. The bulls will be cleaning up.

[pc4900074200] 18/5/2006 10:53

The Scotsman. 18-05-2006.

Labour opens door for new Scots nuclear plants. HAMISH MACDONELL.

SCOTTISH POLITICAL EDITOR.

Labour to contest Holyrood election with 'nuclear manifesto' Decision marks change from previous Executive policy Tony Blair has indicated he wants rapid decisions on new power plants Key quote "We don't want to go into the election saying we are going to build new nuclear stations right now, because that would turn the election into a referendum on nuclear power. But it would be irresponsible to rule out something we might need to meet Scotland's energy needs." - A 'Labour' source

Story in full
LABOUR'S manifesto for next year's Holyrood elections will pave the way for a new generation of nuclear power stations in Scotland, The Scotsman has learned.

Labour leaders have decided the party will contest the 2007 Scottish Parliament election under a policy of "keeping options open" for the construction of new nuclear stations north of the Border.

This marks a significant change from the Executive's current position, which is to oppose any new nuclear plants until the issue of waste has been resolved.

It will also establish a clear electoral fault- line between the SNP, the Greens and the Liberal Democrats, all of whom will go into the election opposing new nuclear stations, and Labour and the Tories, both of whom will accept that they may be necessary to meet Scotland's energy needs.

A senior Labour source revealed that plans were being drawn up to give Labour a three-pronged energy policy for its manifesto.

This would involve:

• Pursuing the continued development of renewable energy.

• Extending the licences of the existing nuclear stations at Hunterston and Torness.

• "Keeping options open" on the construction of new nuclear power stations.

By accepting the basic principle of new nuclear power stations in this way, the Labour manifesto will reflect the views of the Scottish Labour Party and the Scottish Trades Union Congress, both of which voted earlier this year to back new nuclear stations.

The Labour source explained

: "We don't want to go into the election saying we are going to build new nuclear stations right now, because that would turn the election into a referendum on nuclear power. But it would be irresponsible to rule out something we might need to meet Scotland's energy needs."

The depth of the division between the two coalition parties on this issue was made clear by Nora Radcliffe, the Liberal Democrat environment spokeswoman, who stressed her party's implacable opposition to new nuclear stations yesterday.

She said: "The Liberal Democrats have a tough, clear and consistent position - in Scotland and across the UK. We oppose new nuclear power."

The existing nuclear power stations at Hunterston and Torness provide 37 per cent of Scotland's energy and Labour managers are aware that it will be extremely difficult to cover this simply by an expansion of renewable energy.

This is why the policy of extending the lives of the existing stations will be a key part of the Labour platform.

Hunterston is due to be shut down in 2011, but Bill Coley, the chief executive of British Energy, has already made it clear he wants to extend its life by another ten years. .

Torness is not due to shut until 2023 and its owners are likely to apply for a ten-year extension to its licence as well.

Some in the Labour Party hope extending the lives of the existing stations will be enough to meet Scotland's energy needs without building any new stations.

But the party leadership has decided to open the door to new nuclear stations, just in case they are needed, but without explicitly calling for new stations to be built.

Jack McConnell, the First Minister, wants to delay any decisions on a new generation of nuclear stations until after next May's elections, but Tony Blair, the Prime Minister, is picking up the pace at Westminster and Mr McConnell may have to confront the issue before then.

Earlier this week, Mr Blair said the nuclear issue was back on the agenda "with a vengeance", and yesterday Downing Street made it clear that Mr Blair did not want a decision on new nuclear power plants delayed too long.

pc

[pc4900074200] 17/5/2006 06:26

The Scotsman. 17-05-2006.

Nuclear power won't need tax cash. JOHN BOWKER. DEPUTY CITY EDITOR.

BRITISH Energy claimed yesterday that it would not need any more taxpayers' money to build a fleet of new nuclear power stations, saying that all that was required from the government was greater certainty over planning consent and the carbon trading market.

Robert Armour, the energy giant's general counsel, promised a cross-party group of MPs that BE was "not looking for subsidies" to help build new stations - a plan widely expected to be given the green light as a result of the current Energy Review.

However, it warned that private-sector backing would be needed for the new-build, and therefore the government would have to "create a framework" for outside investors. This would include a reliable long-term price structure for carbon, and a simplification of the planning and pre-licensing processes.

Nuclear power currently accounts for more than a fifth of the UK's electricity, yet all but one of BE's eight plants are set to be decommissioned in the next two decades. Their replacement is at the heart of the Energy Review, which aims to establish how the UK can off-set the decline in North Sea oil and gas reserves.

Last night, the Prime Minister, Tony Blair, all but confirmed that the review would come out pro-nuclear, even though the deadline for responses has only just passed. He told the CBI dinner: "I [have] received the first cut of the [energy] review. The facts are stark. [They] put the replacement of nuclear power stations, a big push on renewables and a step change on energy efficiency back on the agenda with a vengeance."

Livingston-based BE was giving evidence to the trade and industry select committee on the challenges facing new nuclear build. The company had to be bailed out by the government two years ago - but is still expected to play a significant part in any future nuclear programme.

Armour was joined by Peter Spence, BE's head of strategy, and Keith Parker, chief executive of the Nuclear Industry Association.

Parker laid out the body's demands of the government, in an argument later echoed by Armour. "The government has to identify the desirable outcomes of energy policy - understood to be security of supply and a reduction in carbon emissions," he said.

Armour noted that the current European emissions trading scheme - which creates a market for carbon - had proved unreliable in recent weeks and is not set to last beyond 2012. "We need a framework up until 2050 if we are to build nuclear power stations," he said.

A key issue in the debate is who will pay for the clean-up process, but Armour said BE itself would set up a fund. "For each megawatt of electricity generated, we will pay a levy into a fund," he said..

However, it was that liability on its current stations that the government was forced to shoulder in rescuing BE in 2003. In a debt-for-equity deal, it insured the decommissioning fund in return for a 65 per cent stake in the company, which it has since announced it will sell.

pc

[pc4900074200] 17/5/2006 06:11

Yahoo News.

Blair energy review branded a sham Wednesday May 17, 06:03 AM

Tony Blair sparked fury by giving his strongest signal yet that he will give the go-ahead to a new generation of nuclear power stations.

The Prime Minister said the issue was "back on the agenda with a vengeance" because of carbon emissions and Britain's growing reliance on imported gas. In a speech to the Confederation of British Industry, Mr Blair said failure to take such long-term decisions would be a "serious dereliction of our duty to the future of this country".

But the anti-nuclear lobby condemned the move and the Government's energy review was widely branded a sham. The Government is carrying out a review of Britain's energy needs which will be published before the summer.

Mr Blair said the twin pressures of climate change and energy security had put the issue at the top of the agenda in the UK and around the world.

The Prime Minister said he had received "the first cut" of the review on Monday.

"The facts are stark," he said. "By 2025 if current policy is unchanged there will be a dramatic gap on our targets to reduce CO2 emissions, we will become heavily dependent on gas and at the same time move from being 80-90% self-reliant in gas to 80-90% dependent on foreign imports, mostly from the Middle East and Africa and Russia.

"These facts put the replacement of nuclear power stations, a big push on renewables and a step-change on energy efficiency, engaging both business and consumers, back on the agenda with a vengeance. If we don't take these long-term decisions now, we will be committing a serious dereliction of our duty to the future of this country."

Mr Blair also used the speech to underline his reform agenda. He said the Government needed to be "in a state of permanent modernisation".

He said the key question facing the Government was not whether to abandon public service reform but "just how far it can be driven", adding: "I (have) described some of the long-term decisions we have to take," he said. "I intend to take them."

pc

[grippa] 16/5/2006 16:45

Blair Signals His Backing for Nuclear Power (Update1)
2006-05-16 12:06 (New York)


(Adds more Blair comment from second paragraph.)

By Robert Hutton and Gonzalo Vina
May 16 (Bloomberg) -- Prime Minister Tony Blair today will
signal his backing for building a new generation of nuclear power
stations, questioning whether renewable energy will be enough to
fuel Britain's needs.
Renewable energy such as wind and solar power have
``technical limitations,'' said Tom Kelly, Blair's spokesman. He
said Blair will tell a dinner of business leaders in London that
the ``twin pressures of climate change and energy security are
raising energy policy to the top of the agenda.''
Unless the U.K. changes course, Blair will say, it will miss
its targets for reducing greenhouse gas emissions and become
``heavily dependent'' on imports of natural gas from the Middle
East, Africa and Russia.
``These facts put the replacement of nuclear power stations,
a big push on renewables and a step change on energy efficiency,
engaging both business and consumers, back on the agenda with a
vengeance,'' Blair will say, according to Kelly. ``If we do not
take these long term decisions now we will be committing a serious
dereliction of our duty to the future of our country.''
Blair, whose government in 2003 called nuclear an
``unattractive'' option, has now made two speeches on energy
policy to the Confederation of British Industry in six months. In
November he told the lobby group that there was ``feverish
rethinking'' on the subject going on around the world.

No Decision Yet

Kelly said Blair was ``stating the facts as we have found
them to be'' and had not taken a definite decision. It was for his
audience ``to take their own view'' of the prime minister's
meaning, he said.
Aging nuclear and coal-fired stations that generate about a
third of Britain's power will be closed by 2020, and the
government has to decide how to replace them. Renewable sources
such as hydro electricity and wind and solar power can fill some
but not all of the shortfall, Blair told the CBI on Nov. 29.
Unlike coal-fired and gas-fired plants, nuclear reactors
produce virtually no emissions of carbon dioxide, the gas
responsible for global warming, according to the U.S. National
Academy of Sciences.
New nuclear reactors may mean contracts for companies
including General Electric Co., Munich-based Siemens AG, Areva SA
of France, British Nuclear Fuels Plc's Westinghouse unit, which
build the reactors, and Essen, Germany-based RWE AG and
Dusseldorf-based E.ON AG, which operate the plants.
Support for new nuclear stations puts Blair on a collision
course with environmentalists who say nuclear power is unsafe,
citing accidents such as the explosion at Chernobyl, Ukraine, in
1986. Two protesters from campaign group Greenpeace scaled beams
inside the CBI conference venue in November, unfurling banners
saying: ``Nuclear: Wrong Answer.''
Opponents also include some in the ruling Labour Party who
supported the peace movements against nuclear weapons in the 1970s
and 1980s, setting the stage for a fresh battle within the party.

[grippa] 16/5/2006 15:23

Blair says Nuclear energy is back on the map with a venegence!!

[call-logger] 27/4/2006 11:48

sweb

Post 9478, mate

[sweb] 27/4/2006 08:00

Why the recent drop off on the share prices chaps?

Any views or news?

[one for the money] 27/4/2006 07:47

Whealan: Agreed

Andypace: Thanks - hadn't noticed that. Agree fall ins overdone.

[andypace] 27/4/2006 07:37

The reason for the recent collapse is the heavy falls seen in the CO2 market:

1622 GMT [Dow Jones] Electricity utilities slide on news several EU countries including France, Netherlands, Czech Republic and Estonia produced less CO2 emissions than expected in 05, a utility analyst says. British Energy (BGY.LN) ends -4.6% to 698p because it is a "pure beneficiary of higher CO2 prices" given that it is primarily a nuclear power company. RWE (RWE.XE) -2.7% to EUR70.4 due to fact that portfolio is heavily nuclear weighted, analyst says. Drax (DRX.LN) -1.6% to 795.5p due to fact that lower CO2 prices results in lower power prices and therefore lower profitability for the coal-fired power generator, analyst adds. (JAM)

However, fall is overdone IMO and I have bought in today.

[whealan] 26/4/2006 19:07

one for the money

Interesting thought which hadn't occurred to me. Comforting if true. I can't think of any substantive cause and hold for what I believe are sound commercial reasons.

[one for the money] 26/4/2006 17:49

IMHO the big drop relates to the effect of the Chernobyl '20-year' event turning punters off nuclear power

(ed: still in trading range though)

Cheers
john

[whealan] 26/4/2006 16:51

grippa

Agree with your last post. It is a fairly large (for me) holding in my pension fund at about £65000 and I am watching with a good profit cushion under my belt. I wouldn't however want to see it materially eroded, whether for good or bad reasons, if you're with me.

[grippa] 26/4/2006 16:41

Not sure whats going on. Obviously we have had massive gains recently, and a bit of retracement is always healthy...I would have thought £7 (purely psychological not technical) would act as the new base but it seems not. Around £6.70 seems to be a good support level if we ever reach there. What has been interesting is that Volume has been huge over the last three days?!?! Longterm chart still looks very good indeed, with a chance to now pick up some cheaper shares!! Might be a good topping up time.

What is for sure is that the story has'nt changed at all. Energy is still sky high, BGY managing to get better prices, new nuclear power stations are still on the agenda and BGY could still be a bid target. Maybe thats whats happening...a big stake building with MM's driving price down to pick up shares?!?! That would expalin the recent huge volume...you never know. Good luck

[grippa] 25/4/2006 15:46

once again a massive drop at the close.

[grippa] 24/4/2006 15:54

Looks like profit takers are now out the way.

[grippa] 21/4/2006 14:48

"Bid rumours" that would do nicely.

[ze fuzzio] 21/4/2006 07:49

SHARES

Nuclear Energy has a hazardous image but it is clean, so the UK government seems to support nuclear's role in future needs in the context of the high oil price and severe constraints on the UK gas supply - good news for BGY. Institutional demand for the shares is strong and the government has responded by announcing its intention to sell part of its stake. The market reacted favourably, as less government ownership will give management greater financial flexibility and potentially open the company up to bidders.

Galvan Research and Trading equity analyst Andrew Gibson says: 'With reliability of its plants improving and a lot its near-term output already contracted out, BGY is evolving into a solid business. The European energy market continues to be in a period of consolidation, so bid rumours may flare up. A move in the share price to new highs looks on the cards'

[grippa] 20/4/2006 16:19

Late sell off??

[pc4900074200] 20/4/2006 09:04

The Herald. 20-04-2006.

Generator shares hit new high. SIMON BAIN April 20 2006

The reconstructed British Energy and its new shareholders are continuing to reap the benefits of sky-high oil and gas prices, while enjoying freedom from the same cost pressures.

The nuclear producer, whose shares have shot up alongside the market price for energy, said yesterday it had achieved price rises of more than 20% for two-thirds of its projected output this year.

The firm, which runs eight nuclear plants including Hunterston in Ayrshire, and Torness in East Lothian, and one coal-fired station, said it had sold the power at an average £41 per megawatt hour compared with £33.30 last year.
Its shares rose almost 5% in early trade yesterday to 746p, their highest since returning to the stock market in January 2005, valuing the business which was rescued from bankruptcy three years ago at £4.2bn.

"It's about high electricity prices," said Mark Hives, analyst at SG Securities. "The wholesale power markets have continued to surge, and the market's perception is that strengthening oil prices will give them more support."

Another industry source said: "They sell into the market, and the market price they can sell at is determined by the gas and coal stations because they dominate the market-place – they sell at whatever price they can get." On the supposed cost advantages of nuclear power generation, he added: "The government's energy review is looking at security of supply and clean energy – cost is not part of the review."

British Energy also said that unplanned outages had lost it nearly 18% of its full capacity for the year, higher than its initial expectations.

pc

[gardenboy] 20/4/2006 07:46

atomik,

I'm not adding more but currently happy to keep holding - my purchase early this month is up 13% which is nice

1 billion squid pre tax consensus forecast for year to 3/08 should see this rise further longer term so 12 squid April 07 quite possible

[pc4900074200] 20/4/2006 07:23

The Times. 20-04-2006.

British Energy

WHAT a difference three years makes. Back in September 2003, wholesale electricity prices had plunged to £14 per megawatt hour and British Energy, the UK's biggest generator and source of a fifth of our electricity, was facing armageddon. Now the rescued company's shares look unstoppable, climbing a further 2.4 per cent yesterday to 730p, after a trading statement revealed that British Energy was striking power contracts at an average price of £41 per megawatt hour - £6 per hour higher than revealed in the last update.

If British Energy was merely a quoted generator, the bull case for it would be more straightforward. The problem is that it is almost entirely a nuclear generator, with all the complications that brings, and, since its restructuring, pays out 65 per cent of its cashflow to the Government.

Assumptions that Tony Blair is determined to force through a new generation of nuclear power stations have helped to drive up the shares of the rescued company. But there is no easy answer to the nuclear question and many believe that the current Energy Review will lead to another fudge. Should that happen, there could be a sharp correction to the British Energy share price.

Last month the Government also announced that it would sell part of its stake in British Energy, effectively cashing in on the recent high price of the shares. A 20 per cent stake is expected to be sold in the autumn, raising, potentially, £2 billion for the Exchequer.

British Energy is not supposed to pay a dividend until at least 2007, but the stake sale will mean that the company can keep more of its cashflow, which may increase its flexibility to pay out earlier. A reduction of the Government's involvement in the company would be treated positively by the markets. But the downside of this is that it could create an overhang on the shares.

With so many big questions unanswered, British Energy is still a risky prospect for many investors. Waiting until the autumn may see some of these resolved. The possibility of a major placing may also provide a better buying opportunity.

pc

[atomik] 19/4/2006 19:24

gb so your predicting £12+ by April 07?

Prelims out end Jun should be good for £8 to £8.50 by then?

worth a another purchase?

[grippa] 19/4/2006 16:11

Great new closing high again today. We should hit £7.50 sooner rather than later at this pace!