Hedgeye’s Macro and Energy teams will host a guest speaker call TOMORROW (Wednesday, January 21st at 1p.m. EST) to discuss current trends in and implications of the commodity hedging practices of US E&Ps, natural gas processors, and various industrial commodity consumers.
The call will feature Wayne Penello and Andy Furman of Risked Revenue Energy Associates (“R^2”). R^2 is an independent hedge advisor serving E&P companies, midstream service providers, and large consumers. Wayne Penello is the President and Founder of R^2, and has 30 years of experience in commodity options trading, market-making, and asset management. Andy Furman has 25 years of experience in energy trading and is an expert at valuing and trading options.
Topics for Discussion:
- Overview of R^2’s services, clients, and proprietary risk management systems;
- The mechanics of entering into a commodity hedge;
- Assessment of current industry hedge positions;
- R^2’s commodity price outlook for crude oil, natural gas, and NGLs;
- Client psychology – what E&Ps are currently thinking and doing in the oil, gas, and NGL markets;
- Likely result of borrowing-base determinations from financial institutions;
- The challenge and opportunity in hedging NGLs;
- And more…
About Risked Revenue Energy Associates:
R^2 is a consultant and market agent in the energy space serving upstream, midstream, and end users of energy-related commodities (including private equity interests). R^2 brings over 150 years of experience including but not limited to market-making, trading, asset management, and industry expertise. The firm utilizes a patented risk management strategy to help implement and stress test a company’s hedge book, leverage, and cash flows, among a long list of other metrics under various scenarios. R^2 suggests the most relevant hedging strategies and negotiates/executes on behalf of their clients on a daily basis.
Wayne Penello is the President and Founder of R^2. He has 30 years of market-making, option trading and asset management experience in the energy industry. Mr. Penello began his career on the New York Mercantile Exchange, where he was a market maker and served as Ring Chairman of options trading. Subsequently, he held positions managing globally distributed energy assets for Vitol S.A., Vitol U.S.A., Tenneco Gas Marketing and Torch Energy. Mr. Penello was formerly a research scientist. He holds a Masters degree in Marine Sciences from Stony Brook University and an undergraduate degree in Marine Biology from Southampton College.
Andy Furman was co-founder and CEO of Atlantic Capital Consultants, an options market-making firm on the NYMEX from 1987 – 2001. After leaving the NYMEX trading floor in 2001, Mr. Furman traded for hedge funds. Most recently he held the position of Managing Director for Hudson Capital Group, LLC where as Manager and Trader for Energy Futures and Options he used spread arbitrage and option strategies to achieve consistent profitability. Mr. Furman holds a Bachelor of Science degree in Chemical Engineering from MIT.