Integrys-AMP Americas in CNG JV - Analyst Blog

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Trillium CNG, a business wing of diversified energy holding company Integrys Energy Group ( TEG ), entered into a joint venture with Chicago based integrated transportation company, AMP Americas, to build a network of compressed natural gas ("CNG") stations across the US. This will be done through the joint venture company AMP Trillium.

AMP Trillium will initially try to rope in the long distance trucking fleets and hence the first CNG stations will be commissioned along the I-65 and I-75 truck corridors. CNG and renewable CNG will reduce the carbon footprint thereby rendering environmentally beneficial service.

In addition, modern technology based equipment will enable fast fueling of the trucks resulting in efficient transportation services. The first station is expected to come online by the second half of 2012.

The combined project will substantially add to Integrys' vast energy delivery business and strengthen Trillium CNG's profile in the alternative fuel industry. In addition, Integrys' transportation cost burden resulting from rise in fuel prices will be mitigated with the placing of cost-effective CNG units. With increasing focus on use of clean emission based products in the US economy, demand for CNG is expected to surge which will boost the company's sales in the coming years.

At the inception of the second quarter, Integrys inked a deal with Golden Eagle Distributors to bring two compressed natural gas fueling stations in the state of Arizona. The high pressured storages will enable trucks to fuel at a much faster rate.  

The company's closest competitor Wisconsin Energy Corporation ( WEC ) is also solidifying its position in the renewable market with its construction of a 50-megawatt biomass plant in Northern Wisconsin. The company's management expects electricity delivered from renewable sources to constitute 10% in 2015, up from 5% in 2010.

Integrys' pro forma earnings guidance for 2012 is estimated to be in the band of $3.35 - $3.55 per share. The company evaluates GAAP earnings in 2012 to be in the range of $3.38 - $3.58 per share.

The Zacks Consensus Estimates for the second quarter and full year 2012 are currently pegged at 38 cents per share and $3.43 per share, respectively.

Based in Illinois, Chicago, the company provides products and services, in both regulated and non-regulated energy markets, through its subsidiaries. In addition, the company has a 34% equity ownership interest in American Transmission Company LLC (ATC), an electric transmission company operating in Wisconsin, Michigan, Minnesota, and Illinois.


 
INTEGRYS ENERGY (TEG): Free Stock Analysis Report
 
WISC ENERGY CP (WEC): Free Stock Analysis Report
 
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ATC , TEG , WEC

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