CNX Resources weighs in on new hydrogen tax credit rules By Investing.com

PITTSBURGH – CNX Resources Corporation (NYSE:) has acknowledged the recent decision by the U.S. Department of the Treasury to recognize coal mine methane (CMM) waste as a usable feedstock for hydrogen production. This recognition comes with the finalization of the rules for the tax credit for hydrogen production, Section 45V, of the Inflation Reduction Act. The company, which is currently valued at around $5 billion, has shown great performance in the market with a return of 80.81% over the past year.

The company, which operates in the Appalachian region, expressed that while the Treasury Department’s recognition of the environmental and economic benefits of CMM is a positive development, the final Section 45V rules appear too restrictive. CNX believes that these rules do not provide sufficient economic incentives to expand CMM capture operations to use hydrogen. With a healthy gross profit margin of 60% and a good financial health score according to InvestingProwhich offers comprehensive analysis and over 10 additional pro tips for CNX, the company appears well-positioned to overcome these challenges.

Despite reservations about the details of the 45V rules, CNX plans to take advantage of this validation and explore alternative incentive pathways for CMM, such as voluntary markets, other tax incentives and compliance program commercial opportunities.

CNX Resources is proud to be a company engaged in the development, production, marketing and technology of ultra-low carbon natural gas. With a 160-year history in one of the world’s most energy-rich regions, CNX holds the equivalent of 8.74 trillion cubic feet of proven natural gas reserves as of December 31, 2023. The company is also a component of Standard & Poor’s Midcap 400 Index. .

In its press release, CNX included cautionary statements advising that the forward-looking statements made are subject to risks and uncertainties that could materially affect actual results. They point to factors such as market volatility, economic conditions, reliance on third-party facilities, industry conditions, debt obligations, strategic decisions, cybersecurity, and regulatory changes as potential risks. according to InvestingPro Analytically, investors should note that CNX’s next earnings report is scheduled to be released on January 23, 2025, which could provide important insights into the company’s strategic direction. For detailed financial analysis and fair value assessment, access CNX’s comprehensive Pro Research report, available exclusively to InvestingPro subscribers.

This update is based on a press release from CNX Resources Corporation.

In other recent news, CNX Resources has been the subject of several important developments. The company recently acquired all membership interests in three entities owned by Apex Upstream, LLC and Apex WML, LLC in a cash deal valued at $505 million. This acquisition is expected to close in the first quarter of 2025.

Meanwhile, Mizuho (NYSE:) Securities downgraded shares of CNX Resources from Neutral to Underperform, citing a cautious outlook on the company’s new business ventures. Despite CNX Resources’ strong performance, largely due to its coal mine methane (CMM) production, Mizuho expressed doubts about CMM’s inclusion of 45V (hydrogen) and 45Q (carbon capture) credits under the LTCA. near.

At the same time, Truist Securities revised its stance on CNX Resources shares twice, initially increasing its price target on the stock from $34.00 to $35.00 following the announcement of the Apex Energy acquisition. However, following CNX Resources’ third-quarter financial results, Truist Securities downgraded the stock from buy to hold and revised its price target to $34 from $38.

CNX Resources was also impacted by the National Weather Service’s milder than average weather outlook for December across the Midwest, which resulted in a notable decline in natural gas inventories, including CNX Resources. These recent developments underscore the dynamic nature of the energy market and the strategic flexibility that CNX Resources has in responding to these changing conditions.

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