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Aug.11
11:40 PM ET
Monday, 11 Aug 2008
In the Studio: Spectra Energy CEO Fred Fowler

As natural gas prices have come down, any stock with even the slightest exposure seem to have fallen out of favor with Wall Street.

But a company like Spectra Energy [SE  Loading...      ()   ], which is makes most of its money pipelining natural gas to market, isn’t as levered to the commodity price as you’d think. At least that’s what CEO and President Fred Fowler told Cramer Monday.

Sure, a higher price entices explorers to dig more and Spectra wouldn’t want nat gas to drop too low because it could hurt demand, but beyond that the company is, for the most part, unaffected, Fowler said.

He did admit, though, to having a “small long position” in natural gas. Spectra has a gathering and processing business and the company is paid by its clients in product. As Cramer pointed out and Fowler conceded, that exposure is probably enough to prevent any kind of earnings upside surprise next quarter.

But nat gas has a bright future, Fowler said. Since it has the cleanest carbon footprint of any fossil fuel, nat gas should come into its own soon enough.

“When climate really becomes an issue and gets on the table, which it will after the election,” Fowler said, “it has to play in the hands of natural gas.”

Fowler hasn’t yet figured what the retail model will be if natural gas becomes the go-to fuel for automobiles, but Spectra will be there to make sure fueling stations can get it.

“That’s exactly what we do,” he said.

Cramer said he’s bullish on Spectra Energy, especially for the dividend yield and the company’s ability to generate cash.




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