Late Bounce Lifting Energy Stocks to Mixed Close

Energy stocks turned mixed in late trade this afternoon, with the NYSE Energy Sector Index slipping 0.2% while shares of energy companies in the S&P 500 were up 0.2% as a group. Crude oil for December delivery settled 78 cents lower at $49.18 per barrel while December natural gas futures dropped 11 cents to finish at $3.04 per 1 million BTU.

In company news, Sempra Energy Inc (SRE) turned solidly lower Wednesday afternoon following reports that sales talks between the natural gas pipelines operator with Odebrecht SA over the potential sale of Odebrecht’s majority stake in a $5 billion natural gas pipeline project in Peru have fallen apart because of commercial differences.

Following the collapse in the discussions with Sempra, the Brazilian engineering company was preparing for a new round of bidding for its 55% interest in the Gasoducto Sur Peruano pipeline, a person with direct knowledge of the talks told Reuters today. Odebrecht has been disposing assets since being caught up in a corruption scandal in Brazil but also has pumped about $50 million into the project to ensure work on it continues, the source said.

SRE shares recently were down nearly 1% at $105.43 each, dropping as low as $104.97 a share in late trade after the Reuters report broke.

In other sector news,

(+) LGCY, Secures $300 mln second-lien term loan credit agreement with GSO Capital Partners LP, with the five-year loan package requiring a 2% upfront fee and 12% yearly interest.

(-) WFT, Reports non-GAAP Q3 net loss of $0.39 per share, missing the Capital IQ consensus by $0.14 per share. Revenue falls 39.4% from year-ago levels to $1.36 bln, also trailing Street view by around $80 mln.

By Caroline Williams