Eagle Rock Energy Partners, L.P. (NASDAQ:EROC) Gives Back Gains From likely EPA Announcment


Dallas, Texas 10/28/2013 (Financialstrend) – Eagle Rock Energy Partners, L.P. (NASDAQ:EROC) is a $1.13 billion market capitalized oil and gas refining and marketing company. Over the past one month the stock of this under pressure oil refiner has managed to eke out a 1.26% appreciation on its market value on the back of speculation that is doing the rounds that Environmental Protection Agency might reduce the current ceiling on the quantity of bio fuel which needs to be mixed with fossil fuels. The agency had brought in this measure during the Junior Bush presidency to goad the U.S. economy to rely less on fossil fuels.

This move had in turn given rise to a parallel bio fuel economy with a host of companies investing infrastructure and capital into plants which converted agri based products like Corn and molasses into combustible bio fuel. In the recent past the EPA had voiced concern on the huge strain that the bio fuel industry is placing on traditional agriculture based supply chain due to their increasing demand for agri products like corn.

In news items which broke into the mainstream on October 10, agencies reported that EPA has finally made up its mind to relax the ethanol mixing requirement starting next year. EPA has cited the non sustainability of additional ethanol use than current levels. This news has been welcomed by refineries across the board. The stock of most rallied smartly to post close to 4% to 5% increases in their market value. Eagle Rock has been a laggard in this context due to the continued pressure the company is facing in managing its cash flow requirements. In the past week, the stock shed its EPA induced gains to drop down in market value by 3.2%. As of close of business on October 25, the stock was trading at $7.26 per share, down 3.33% from its previous day close.