Saturday, February 22, 2020

Lutefisk -- First Lutheran Church -- Williston, ND -- February 22, 2020


Bernie Sanders Lake Front Cabin -- For The Archives -- February 22, 2020

Bernie: like thousands of Vermonters, we, too, have a lakeside cabin. From Snopes, and if it's from Snopes you know it has to be true:
Jane Sanders said she and her husband paid cash — $575,000 — for the four-bedroom summer house they recently bought in North Hero on the Lake Champlain shore. She said she sold her share of her family’s long-time vacation home in Bridgton, Maine, to her brother for $150,000, added some money from her retirement account and from an advance her husband got on a book he is writing to come up with the money to buy the couple’s third home.
And not only that, they paid cash -- almost $600,000 -- for the "cabin." Anyone who plops down $600,000 in cash for a third home tells me they have no financial worries.

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"Someone" With Financial Worries: The EU

Short $85 billion.

After the UK leaves.

From the Daily [London] Mail, so you know the story will be good!

Link here

But it's even better than expected: Sweden -- birthplace of St Greta -- refuses to spend any more money to fight climate change.

Sweden's attitude: we will let Boris swelter in the land of no air conditioners.


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Another Doofus

From the WSJ, by Jason Zweig:
Morgan Stanley’s takeover of E*Trade Financial Corp. for $13 billion shows how drastically the brokerage industry’s business model has changed.

Firms no longer want to offer investment products from all sources. Instead, they want to milk their customers’ cash and manage all the assets themselves. Investors need to understand the rules of the new game.

For decades, big banks and brokers aspired to become “financial supermarkets” where consumers could open bank accounts and buy stocks and bonds, mutual funds, insurance and the like.
Here, hold my Schwab statement.

For a gazillion years, for reasons (somewhat) out of my control, I had a small equity account at a local bank. The annual fee was "only" 0.5% and trading fees (commissions) were $4.95/trade. Sounds good, doesn't it? Only 0.5% and $4.95/trade.

On average, over the years, I made one trade/year.

Over the years, I gradually built up a dividend-focused, growth-focused equity account. Yes, growth and dividend (not value and dividend) and after thirty- forty years it's become a very nice account. The dividends alone would pay for living expenses for a year, if need be. When I started the account, I had few options, and 0.5% was not an issue. The portfolio has exceeded all my expectations. I still trade on average once/year. (Thank goodness I don't have automatic dividend reinvestment.) It now turns out that the 0.5% eliminates the entire dividend for one of the better dividend payers.

The trust department at the bank was simply acting as a bookkeeper and getting an incredible fee. A fee that would cover my annual mortgage (if I had a mortgage). And that was to make one trade/year.

As far as "choice" goes, about which Jason Zweig is so concerned, Schwab offers a gazillion ways to invest, including competitive money market accounts. And Schwab has so many non-Schwab partners, there is [practically] no limit on where/how to invest.

If one is only earning 0.3% in a "sweep" account at a brokerage (including Schwab)  you are doing it all wrong.

Yes, I'm closing that bank account and moving it to Schwab.

Canada: Still Closed To Business; US Navy Grows; Coronavirus -- Is South Korea Next? -- February 22, 2020

On February 13, 2020, I noted that Canada was (again) closed to / for business. It appears things have gotten worse, if that's even possible. This was supposed to have been over by now, but it continues. From The WSJ (and if it's in the WSJ, you know it's a huge story and you know it's true):
TYENDINAGA MOHAWK TERRITORY, Ontario—A small cluster of flags and windswept tents sits near railroad tracks east of Toronto, where protesters are preventing trains from passing through a key commercial corridor, threatening Canada’s already fragile economy.

Activists from the Mohawk community here say their encampment was set up to show support for a group of indigenous leaders on the other side of the country, in British Columbia, who are trying to stop construction of a natural-gas pipeline. The makeshift blockade, which has caused widespread supply-chain and passenger disruption in busy Ontario, is the latest sign of how indigenous groups in Canada are stepping up their civil disobedience amid long-simmering grievances with government leaders.

“We’re going to stand up and stand our ground,” said Andrew Brant, a teacher in Tyendinaga who is protesting alongside those at the encampment. He said the group wants the Canadian government to meet with hereditary leaders, who are unelected but seen as responsible for traditional land and who oppose the pipeline.
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US Military
MAGA

I was completely unaware of this. Again, another big deal on so many levels. Thank you, Mr Trump. US Navy will acquire thirteen F-35s to support amphibious operations.

And, oh, by the way, who is going to appreciate this the most: the US Marines. The US Navy gets them there, but it's the US Marines that do the actual assault. At least that's the meme.

From the source (one will need to google it):
Launching a massive, fast-paced air assault from the sea, providing close-air support for amphibious assault forces, and bringing forward-operating surveillance and networking technology to maritime warfare are all part of the changing operational calculus introduced by adding F-35s to maritime attack.
With the goal of refining and preparing for these kinds of emerging maritime combat tactics, a high-tech U.S. Navy amphibious assault ship recently completed a deployment mission armed with as many as 13 F-35s.
The Navy’s USS America, a first-in-class new generation amphib, traveled the seas armed with 13 F-35s, senior Navy officials said. This brings an unprecedented measure of air attack and surveillance possibilities, including the option to provide stealth air support to amphibious assaults.
Amphibs could offer a smaller, more mobile type of aircraft carrier power projection capability, Vice Adm. Rich Brown, commander, Naval Surfaces Forces, told an audience Jan. 14 at the 32nd Annual Surface Navy Association Symposium.
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Coronavirus Update 

The coronavirus is tracked at the link at the top of the sidebar to the right.

Or you can go to this link directly. Observations:
  • the Chinese are still using the Iowa-DNC tabulating software to count cases
  • this is what really, really spooked the markets: South Korea looks ready to get hit, and hit hard, by the virus;
  • the "overall growth factor" continues to trend down;
  • total deaths, changes in total, now at 5% -- a record low; and half of what it was only one week ago (10% then);
  • daily deaths, change in daily, not at a negative 7 percent; in the past twelve days:
    • five days with an increase day-over-day;
    • one day: no change, day-over-day;
    • six days with a negative percent, day-over-day






Fertilizer, Tractors, Propane, Deere, Bloomberg, And All That Jazz -- February 22, 2020

The Farm Page

Bloomberg: to the list of deplorables, add the American farmer. 

From January 16, 2020 -- re-posting:
Deere: buy a bigger tractor. Deere aims to reap billions with "corn warrior" technologies.
The average acre of corn planted in the U.S. yields more than 170 bushels. A bushel—an old measure of weight—is 56 pounds of corn kernels. That means corn planted on an acre—the standard U.S. measure of farming area that is a chain times a furlong, two other old measures—generates almost 5 tons of food.

That is impressive, but there are more-impressive feats of corn.

The top of the range—the best farmers can do—is more than 600 bushels an acre. One farmer grew 616 bushels of corn on an irrigated acre with Corteva (CTVA) seed in the national corn-growing contest.

Yes, there is such a contest.

The farmers competing—some of whom call themselves corn warriors—are spending a lot of time and money ensuring the health of each corn plant. Nothing is too small to measure. It might not be practical or cost-effective to adopt all the techniques used to generate incredible crop yields en masse. But the yields they achieve demonstrate the upper fertility limit of American cropland.
A few months ago, I posted: farmers need to buy a bigger tractor and a bigger propane tank.

Now this: Deere's unexpected rise in quarterly profits sends shares soaring. Link here.
Deere & Co on Friday reported an unexpected increase in first-quarter profit and retained its full-year earnings forecast as signs of stabilization in the U.S. farm sector offset weak demand for construction machines, sending its shares soaring.
"Its shares were last up 6.4% at $176.25 in pre-market trade." Its shares were last up 6.4% at $176.25 in pre-market trade.
The world's largest farm equipment maker's earnings in the past quarters were buffeted by a nearly two-year-long U.S.-China trade war that hit U.S. agricultural exports, leaving farmers struggling to turn a profit.
But President Donald Trump's interim trade deal with China has raised hopes of a recovery in farm machinery demand.
From The WSJ yesterday: Trump is prepared to give more aid to farmers. [Bloomberg: it doesn't take any gray matter to be a farmer.]
President Trump said the U.S. would consider a third round of aid payments for American farmers who have borne the brunt of retaliation for U.S. tariffs for much of the past two years.
Although the U.S. has said farmers would benefit from its signing of a phase-one trade deal with China and its ratification of the new U.S.-Mexico-Canada Agreement, Mr. Trump raised the possibility that new aid payments may be necessary until those deals bear fruit. The USMCA was signed in late January and the China deal didn’t take effect until February 14, 2020.
If farmers “need additional aid until such time as the trade deals with China, Mexico, Canada and others fully kick in, that aid will be provided by the federal government,” the president said on Twitter on Friday.
Fertilizer: US fertilizer consumption to rise with acreage -- Argus Media.
US fertilizer consumption this year will be the highest in over a decade as farmers are set to plant 94mn acres of corn and 85mn acres of soybeans.
Nitrogen consumption should be 4pc higher than last year at 8.83mn st N across corn, soybean, wheat and cotton, Argus estimates. Phosphates consumption would rise by 5pc to 4.19mn st P2O5, potash by 6pc to 4.32mn st K2O and sulfur up by 4pc to 392,000st S.
In remarks at a conference yesterday, US Department of Agriculture chief economist Robert Johansson said that US corn acreage would rise to 94mn acres — toward the upper end of previous industry estimates — as forward prices and the corn:soybean price ratio are favorable to corn. Last year farmers planted just under 90mn acres of corn as flooding and inclement weather prevented fieldwork.
But Johansson also noted that the price ratio was not even, with basis in the Dakotas favoring soybean but eastern Corn Belt and southeast prices favoring corn.

Friday, February 21, 2020

A Closer Look At A Whiting Well That Came Off Confidential List Today; Neighboring Well With 700K Bbls Cumulative Crude Oil -- February 21, 2020

Updates

Later, 9:34 p.m. Central Time: see first comment --
Eerie point in this story that the EXTRA Bakken ethane that needs to be pulled out of the gas (not all of it, just the extra) would be enough to fill a cracker.

https://btuanalytics.com/bakken-gas-quality/

Call Burgum. [Governor Doug Burgum, North Dakota]
Original Post

The well:
  • 35945, 983, Whiting, White 43-33H, 37 stages; 8.4 million lbs; Sanish, t9/19; cum 82K 12/19;
Production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN12-2019311558915582401819628184651114
BAKKEN11-201930156701560938511763717345247
BAKKEN10-2019282134621335688221836133488441
BAKKEN9-2019282335723580855422719022671
BAKKEN8-20198566453583497350403469

From the file report:
  • spud date: March 10, 2019
  • cease drilling: March 27, 2019
  • middle Bakken: 9,997' TVD, one foot low to the prognosis;
  • background gas averaged 780 units in the middle Bakken;
  • the top of the Three Forks, 10,089' TVD, three feet high to prognosis; background gas averaged 700 units;
  • 1st aquitard: 10,127' TVD, one foot high to prognosis; background gas averaged, 750 units;
  • Three Forks 2nd bench: 10,138' TVD, two feet high to prognosis; average gas, 200 units;
  • 2nd aquitard; 10,175' TVD; ten feet high to prognosis; background gas averaged 180 units;
  • Nisku: 10,339' TVD; 99 feet high to prognosis; background gas at 150 units;
  • drilling the lateral:
  • difficulty with initial lateral
  • sidetrack #1, successful;
Older, producing, neighboring wells:
  • 19174, 2,090, Whiting, Kannianen 43-33H, Sanish, t10/10; cum 391K 4/19; off line 4/19; remains off line 12/19;
  • 20437, 134, Whiting, White 43-33TFH, Sanish, t12/11; cum 177K 12/19; off line 2/19 - 8/19; minimal jump in production when it came back on line;
  • 18298, 3,422, Whiting, Kannianen 44-33H, Sanish, t10/10; cum 702K 4/19; off line 4/19; remains off line 12/19; from spud to NW lateral, 13 days drilling; sidetrack #1, twenty-one days from spud; during a trip back into the hold, gases reached 9,598 units with a 20' flare;

A Closer Look At A Petro Harvester Well -- Still A DUC, But Producing -- February 21, 2020

The well:
  • 36690, SI/NC, Petro Harvester, Three Forks, first bench; FTH1 27-34 161-92 B, Foothills, t--; cum 16K first full month of production;  
Production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN12-201931160061570510213120477020477
BAKKEN11-2019105390221523760376


From the file report:
  • 13 miles north of Powers Lake, Burke County; sits on a pad with intentions of drilling a lateral through the Three Forks, first bench;
  • Patterson 348, a modern top drive rig with walking capabilities; surface to TD in 13 days;
  • vertical to KOP: 48.9 hours
  • KOP to curve TD: 12.8 hours
  • lateral with one assembly: 55.7 hours
  • total lateral footage: 9,906'
  • target window: 12- 20' into the Three Forks first bench;
  • exposed 75.6% of the lateral borehole to the target window;

Only Two Wells Coming Off The Confidential List Today -- February 21, 2020

Flaring: Texas unveils flaring criterion
  • Flaring has increased significantly overall in Texas during the past decade, paralleling the state’s oil production levels. 
  • The estimated range of 650,000 thousand cubic feet per day (Mcf/d) of total flare volumes for Texas oil and gas operators in 2018 ranks among the highest levels on record. 
  • Among the world’s top oil-producing regions for 2018, the United States and Texas’ respective flaring intensity values fall below the international average. 
WTI price jumps on booming US exports. Link here.
  • American oil exporters shipped the equivalent of more than one-fourth of the nation’s output to foreign buyers, a government report showed. Meanwhile, U.S. oil stockpiles rose by 415,000 barrels last week, well below the 3.2 million forecast by analysts.
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Back to the Bakken

Active rigs: 

$52.912/21/202002/21/201902/21/201802/21/201702/21/2016
Active Rigs5566554238

Two wells coming off the confidential list today:


Friday, February 21, 2020: 49 for the month; 156 for the quarter, 156 for the year:
  • 36690, SI/NC, Petro Harvester, FTH1 27-34 161-92 B, Foothills, t--; cum 16K first full month of production; 13 miles north of Powers Lake, Burke County; sits on a pad with intentions of drilling a lateral through the Three Forks, first bench;
  • 35945, 983, Whiting, White 43-33H, Sanish, t9/19; cum 82K 12/19;
RBN Energy: the changing composition of a US NGL barrel.
There is no such thing as a typical NGL barrel. For example, the composition of y-grade production out of the Marcellus is significantly different from y-grade out of most of the Permian. And it is not just gas processing engineers who care. The make-up of an NGL barrel is inextricably linked to the value of that barrel. The reason is pretty simple: there’s a big difference in the value of each of the five NGL products. These days, natural gasoline is worth nearly eight times as much per gallon as ethane. Normal butane is worth 1.6X as much as propane. Consequently, the more natural gasoline and normal butane in your barrel versus the amounts of ethane and propane, the more the barrel is worth. So it’s important to anyone trying to follow the value added by gas processing and related infrastructure to understand where these numbers come from and how much the composition of a barrel can vary from basin to basin, or for that matter, from well to well. In Part 2 of our series on gas processing, we turn our attention to the variability in the mix of NGL production and its implication for processing uplift.
Earlier we laid out a framework for the basic understanding of natural gas processing value creation, using the frac spread as the metric. Frac spread — the differential between the price of natural gas and the weighted average price of a typical barrel of NGLs on a dollars-per-Btu basis — is a rough-cut indication of the value added at gas processing plants by extracting NGLs out of the raw natural gas stream from the wellhead. We went through a frac spread history lesson to explain what the measure can tell us about cycles in the natural gas and NGL markets, and then we worked through an example using RBN’s basic frac spread Excel model. After touting all the exceptional insights that can be gleaned from looking at the frac spread over time, we then looked at the limitations of the frac spread model, including differences between the mix of NGL purity product components in the NGL barrel from one production area to another, and from one set of market conditions to another. Today, we’ll delve into the details of those issues, and along the way, we’ll point out some data quirks imbedded in the assessment of NGL production volumes.

Clearing Out The In-Box -- February 21, 2020

Fracking ban talks: something is going on here. I'm beginning to think we're rounding up the "usual suspects" and not considering the real culprits. 

Solar: recent article on Tonopah. Now we have this on Ivanpah. The world's largest concentrated solar plant generates as many problems as megawatts. -- Atlas Obscura.

Power Line:
Fact check: earlier I mentioned that I don't recall Mike Bloomberg suffering a heart attack as Bernie Sanders claimed. I was correct. Bernie, after the debates, sent out a correction: Bloomberg had had stents placed as a precautionary measure; no history of heart attack.

US Navy: amphibian assault forces to get F-35s. Huge, huge story. Google key words. 

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Fossil Fuel

Oilprice:
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Market Meltdown 

Goldman Sachs, Alan Greenspan, WHO press conference mentioning pandemic -- all coincidentally spoke around 10:00 a.m. yesterday. All "Debbie Downers." Dow dropped almost 400 points By end of day had recovered remarkably. Down only 160 points. This morning, futures suggest Dow to open another 100 points down.

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Re-Posting

AOC has company: Bolingbrook, IL, mayor rejects Amazon's offer to build a "massive" distribution center in Bolingbrook.

Japan: and coal

Disclaimer: this is not an investment site.  Do not make any investment, financial, career, travel, job, or relationship decisions based on what you read here or think you may have read here.


If You Have Time For Only One Post Today -- February 21, 2020

The most important campaign document of 2020

Thursday, February 20, 2020

Note To Readers -- February 20, 2020

I am exhausted tonight, and I assume that will be the norm for the next several weeks.

My wife is in Portland, OR, and I'm the Uber-granddaughter driver (three granddaughters), their cook, and whatever else is required, and by the time I get home, I'm pretty exhausted. From 3:00 p.m. to around 10:00 p.m. I am with the granddaughters: water polo; soccer; skating; etc.

There is so much happening, but I won't get to these stories until morning. I may not see comments until each morning.

But, wow, I'm in a great mood.

This is why I'm so exhausted tonight:


Our oldest granddaughter's school had a skating party tonight. Sophia really wanted to go. But she needed help, of course. But, wow, what a trooper. The skating party was from 6:00 p.m. to 8:00 p.m. and Sophia skated the full two hours, and I had to hold her "walker" the entire time. I'm not kidding. Two hours of skating, hunched over. And Sophia loved it.

The video clip was taken by the high school granddaughter -- I wish it had been longer, but I'm happy we got what we got.

Sophia and I rented our skates, of course (some students had their own skates). When I went up to the counter to get may skates, all I could see on the shelves were four-wheel skates. The young man asked, "skates or blades?"

Having spent my formative years in Los Angeles, I thought he was asking with which high school gang I was associated, think: "Crips or Bloods?" He repeated, "skates or blades," and then I remembered "roller blades." LOL.

I used to roller blade along the Venice (Los Angeles, CA) many decades ago but had not roller bladed in such a long time, I completely forgot all about them.

Cruisin' (Sunset Sam), Michael Nesmith

I was the only adult on the skating rink. Sophia was one of two non-high school students.

Brand New Key, Melanie

By the end of the night, Sophia was doing quite well.