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Feb 11
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LONG
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Donald Trump
President of the United States
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"I'm directing the Department of Energy to issue funds to coal plants... to keep them online... I will sign an executive order that directs the Department of War to work directly with coal plants on the new power purchasing agreements." The federal government is shifting from a regulator to a guaranteed customer and subsidizer of the coal industry. By mandating the military (Department of War) to buy coal power and issuing direct funds to prevent closures, the terminal value risk of these companies is removed, and cash flows are government-backed. Peabody (BTU) was explicitly named and honored. LONG US coal producers as beneficiaries of direct state support and military contracts. Reversal of executive orders by courts or future administrations; global pricing pressures on thermal coal. |
CNBC
President Trump participates in an event on c...
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Feb 11
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LONG
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Doug Burgum
Secretary (Implied Energy/Interior/State Role)
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Burgum emphasizes "picking reliable, affordable nationally-secure sources" to meet the needs of "industry and what we need for AI," while rejecting "intermittent" sources. "Reliable" and "Nationally-secure" are code for domestic fossil fuels (Oil, Gas, Coal). If offshore wind (a major planned source of future capacity) is subtracted from the grid, the massive power demand from AI data centers must be met by dispatchable thermal energy. Long US Oil majors (XOM, CVX), E&Ps (DVN, CTRA), and Coal (BTU, CEIX) as the beneficiaries of the "baseload" pivot. A sudden breakthrough in battery storage technology making solar/onshore wind fully dispatchable. |
Bloomberg Markets
Offshore Wind Farms Are Security Risks, Burgu...
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Feb 11
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LONG
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Doug Burgum
US Secretary of the Interior
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Burgum states "Coal was the hero" during recent storms and explicitly mentions the "reversal of the endangerment finding," calling EPA regulations a "massive overreach." The "Endangerment Finding" is the legal bedrock for EPA CO2 regulations. Reversing it or rolling back these rules halts the forced retirement of coal plants. If plants stay open longer to provide baseload power for AI/Data Centers, the terminal value of US coal producers (Peabody, Arch, Consol) re-rates significantly higher. LONG. The sector is priced for liquidation; policy shifts it to "cash cow" status. Utilities may still retire plants due to ESG mandates or cheaper natural gas, regardless of federal permission to keep them open. |
Bloomberg Markets
Coal Kept the Lights On During Storms, Burgum...
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Feb 10
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LONG
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Karoline Leavitt
White House Press Secretary
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The President is hosting an event to "tout clean, beautiful coal" and will formalize the rescission of the 2009 Obama-era endangerment finding. The "endangerment finding" was the legal bedrock for EPA regulation of CO2. Rescinding it removes the primary regulatory risk overhang for US coal producers. Furthermore, the administration is explicitly marketing coal as the solution to grid reliability issues during winter storms. LONG US Coal producers. They are likely trading at low multiples due to terminal value risks that are now being legislatively delayed or removed. Legal challenges from environmental groups could stall the rescission in courts. |
CNBC
White House press secretary Karoline Leavitt ...
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