Thursday, October 18, 2018

SRE's 30-Second Elevator Speech -- October 18, 2018

There are a gazillion utilities "out there." I've held different utilities in my investment portfolio over the years, for various reasons. Generally I buy and accumulate shares in utilities for the long haul. There are notable exceptions.

Two utilities of the gazillion "out there" are currently on my radar scope. One has been in my portfolio for decades; the other has only recently appeared on my radar scope.

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

SRE and D.

I might talk about "D" some other day.

Today, SRE over at SeekingAlpha. It is a "nine-page" internet article. I did not read past the first page. I read (past tense) no more than the following and will not go back and read any more of the transcript:
As you recall in June, we announced our strategic vision to become North America's premier energy infrastructure company. We're also committed to executing a disciplined and phased approach to optimize our asset portfolio around what we believe are the most attractive markets right here in North America. In that regard, Oncor and its operations in Texas provide a solid foundation to build on and advance that strategy.
Oncor and Sempra entered into agreements to acquire InfraREIT in a 50% interest in Sharyland respectively. We’re actually quite excited about this Texas T&D transaction for several reasons. First it expands the transmission and distribution platform we created in Texas when Sempra acquired its interest in Oncor back in March.
Second, it adds another avenue for growth through incremental pure play regulated transmission opportunities and Texas is an attractive market where we’re currently seeing over 70 gigawatts of solar and wind and interconnection queue.
Third, it’s a great opportunity to recycle proceeds from the recently announced sale of our U.S. solar portfolio. In fact that's what allows us to do this transaction without issuing any equity. And fourth, it allows us to further increase the percentage of Sempra's earnings from our long-term T&D businesses and strengthens our credit profile while offsetting the slight dilution resulting from the sale of Sempra Renewables business and storage assets.
That's all I need to know. 

It's the company's 30-second elevator speech.

Geo-Fossil-Fuel-Politics: Under Previous Administration, The US Conceded Future Fossil Fuel Arctic Exploration To Others -- October 18, 2018

Today it's being reported that Saudi Arabia is more than happy to fill that vacuum. is reporting:
Now that global oil markets have gotten used to Saudi-Russian oil production cooperation that first hit the scene in early 2017 in an effort to reign in global price concerns, it now appears that the two fledgling allies are also going to cooperate in the liquefied natural gas (LNG) sector. And this time too, it looks as if the alliance could take aim at U.S. energy ambitions.
The kingdom’s media savvy energy minister Khalid Al-Falih said at the India Energy Forum in Delhi on Monday that Saudi state-owned Saudi Aramco is open to the idea of marketing some of the LNG from the proposed Russian Arctic LNG 2.
“Aramco has the mandate to go global and not only invest in downstream but also invest in gas and LNG. We have looked at projects in Africa and the Mediterranean, and of course the Arctic with some Russian companies, Novatek. The idea is that Aramco will trade that [LNG] globally and bring some of that to India and other markets,” Al-Falih said.
Murder in the consulate? What murder? That's so yesterday. 

Poll: Should Trump Close US-Mexico Border ...
... Before/After The Mid-Term Elections

This is very interesting. Binary thinking.

First binary choice: is the massing of Honduran "families" serious enough for the president to do something brash? Yes/No

President Trump is accused of being very brash. He comes across in word (tweet/rallies) as being very brash, but from my perspective he has been much more measured. His bark is louder than his bite is serious. So, for him to unilaterally close the US-Mexico border would be perhaps the most "brash" thing he has done.

If one feels he should not be so brash as to close the border then we move on. No poll. Nothing to see here.

But if the president (or it appears, John Bolton) sees this as a serious enough issue to do something as brash as closing the border, then it's a binary choice: close the border before the mid-term elections or close the border after the us mid-term elections.

From my perspective, regardless of whether it's the "right" thing to do or not, the anti-Trumpers would jump on this as a brash act by the president. Like the Kavanaugh circus, the merit of the decision would not be the issue. The "definition" and "defining" of "brashness" would become the issue. The issue may affect the Cruz-O'Rourke race. And not necessarily in a good way. As things stand, Cruz should win by at least a small margin. If Trump does something brash, Cruz might win by a bigger margin (so what? a win is a win regardless of the margin; ask Brett); if folks see Trump as being brash, then Cruz might lose by a narrow margin. Oh-oh.

Others will disagree. Others see the Cruz-O'Rourke race as a too-close-to-call and a brash act by Trump would cement a win for Cruz.

I think Trump could get just as good a response from Mexico if he personally spoke with the president, while at the same time sending the US SecState to visit the Mexican ambassador to the US, making it very clear, the border is closed the day after the election if the Mexican government does not stop the mass migration.

So, ignoring the question of whether the issue is serious enough for the president to take serious action, should President Trump close the border before the mid-term elections, or the day after the mid-term elections.

The poll is at the sidebar at the right.

The Heidi Heitkamp - Kevin Cramer debate is tonight. I think one will be able to tell how Heidi's internal polling is trending based on how she answers the questions. If she says she has brought huge bi-partisan support to the US Senate ...


It will be interesting to see the overnight polling.

Most recent poll at this link:

For Newbies: Good Example Of What We Mean By The "Right" Kind Of Oil -- October 18, 2018

Over at China can't get enough of Canada's heavy oil -- at a $50 discount from WTI. But it's not just the price. It's also the "right" kind of oil -- the kind of oil China needs:
China’s two other main sources of heavy crude—Australia and Venezuela—are both going through a production decline albeit for different reasons.
While the Venezuela situation is clear and unchanged, Australian heavy crude production has been on the decline due to natural depletion. In fact, Woodside, the operator of the field that produces one of its benchmark heavy grades, Enfield, plans to stop pumping oil at the field by the end of this year.
Currently, there is also the seasonal factor of construction: Chinese refiners use a lot of the heavy crude they import for the production of asphalt, to be used in road construction, under Beijing’s large-scale infrastructure plans. But even after this seasonal high, chances are Chinese refiners, state and teapots alike, will continue to take advantage of the low price of Canadian crude.
There are no signs that the pipeline situation in Canada will change anytime soon. There are also no signs that production growth will begin to slow. Canadian producers are pretty much in the same position as their U.S. counterparts with the exception of the difference in prices. They need to pump more because they have debts to repay and businesses to keep afloat.
that Chinese companies had bought three cargoes of Canadian heavy crude, to load in Vancouver in November. More will follow: the huge discount of Western Canadian Select to WTI is not the only reason for this shift. The other reason has to do with supply. China’s two other main sources of heavy crude—Australia and Venezuela—are both going through a production decline albeit for different reasons.
If it weren’t for the hefty discount to WTI, the shipping costs would have remained too high to be attractive for Chinese refiners.
Note that another source of "heavy oil" seems to be drying up.

ERF's "Cloudy" Pad

ERF's cloudy pad:
  • ERF has permits for a 7-well "cloudy" pad in lot 2 section 1-148-95.
Existing wells:
  • 24164, 898, ERF, Nimbus 149-94-33D-28H, Eagle Nest, 29 stages; 7.4 million lbs, MB about 90 feet thick?, t4/13; cum 262K 8/18; 
  • 24163, 759, ERF, Cirrus 149-94-33D-28H, Eagle Nest, 28 states; 6.5 million lbs, t4/13; cum 243K 8/18; 
New permits:
  • 35594, Fog, TF,
  • 35595, Lenticular,
  • 35596, Stratus, TF,
  • 35597, Cumulus,
  • 35598, Vapor, TF,
  • 35599, Haze,
  • 35600, 35600, Alto, TF,
"Families" of wells are linked here.

Fourteen New Permits; 70 Active Rigs; WTI Takes Another Hit -- October 18, 2018

WTI: takes another hit today; down almost 1.5%; down about $1.00; trading at $68.73;

Active rigs:

Active Rigs70553267190

Fourteen new permits (35594 - 35607):
Comments, cont'd: the two wells already in that ERF drilling unit:
  • 24164, 898, ERF, Nimbus 149-94-33D-28H, Eagle Nest, 29 stages; 7.4 million lbs, MB about 90 feet thick?, t4/13; cum 262K 8/18; 
  • 24163, 759, ERF, Cirrus 149-94-33D-28H, Eagle Nest, 28 states; 6.5 million lbs, t4/13; cum 243K 8/18;
One permit canceled:
  • EOG: a Riverview permit in McKenzie County
Three permits reinstated:
  • XTO: three Cole permits, all in McKenzie County

As Demand For CBR Rises, Desmog Alerts Us To "De Risk" -- October 18, 2018

Link here, sent by a reader.
While a second oil-by-rail boom is well underway in North America, both the U.S. and Canada are taking steps that ignore or undermine the lessons and regulatory measures to improve safety since the oil train explosions and spills of years past.
Canadian oil-by-rail now is operating at record levels, which are predicted to double by 2019. Favorable economics have led to a recent rise in oil-by-rail movements in the U.S. as well, with more Bakken oil moving by train to East Coast refineries.
Meanwhile, in September the Trump administration finalized its rollback of a regulation requiring an updated braking system for oil trains, known as modern electronically controlled pneumatic (ECP) brakes, in a highly questionable regulatory process detailed on DeSmog last year.
In North Dakota, the Department of Mineral Resources now plans to reverse a regulation which required even the minimal stabilization of oil transported by train, with “stabilization” referring to a process that removes some of the natural gas liquids that make Bakken oil so explosive. That move doesn't bode well for avoiding earlier scenarios in which rail operators dubbed oil trains as “bomb trains.”
In September Canada committed to phasing out some of the unsafe older rail tank cars ahead of schedule, but a derailment earlier this year shows that this step is far from foolproof. On June 22, a train carrying Canadian oil that derailed in northwestern Iowa was using the newer DOT-117R tank cars, the same ones being phased in as the new standard. The derailment still resulted in the release of an estimated 230,000 gallons of tar sands oil into local floodwaters.
And while track defects are the leading cause of train derailments (which, of course, lead to fires, explosions, and spills), the Trump administration has hit pause on efforts to regulate rail wear, which makes unlikely the possibility of new rules on this issue while Trump is in office.
I wonder if De-Smog prefers pipeline to CBR.

Atmospheric CO2

Did I forget to post the August, 2018, data? Can't remember.

Link here.

It's a losing battle. FWIW, one year ago, September, 2017, atmospheric CO2 was reported to be 403.38 parts per million). That represents a 0.5% increase year-over-year. In parts per million, it was an increase of 2.13 parts per million, or 2.13 / 1,000,000 = 0.000213 percent, or slightly more than the amount of Mexican/South American DNA Pocahontas has in her genetic genome.

Demand, Demand, Demand -- October 18, 2018

The "price must be right." From
Tankers carrying some 22 million barrels of Iranian crude are on their way to the Chinese port of Dalian, Reuters reports, citing ship-tracking data, and noting this is a record-high amount of crude from Iran to be received by Chinese clients amid falling imports to other large clients, such as Japan and South Korea.
Both countries earlier this month said they had completely suspended their purchases of Iranian crude ahead of the U.S. sanctions, which will enter into effect on November 5.
Dalian is a major oil hub in China and, Reuters notes, Iran has used storage facilities at the port to keep crude during the previous international round of sanctions against Tehran. The usual rate of Iranian crude oil cargoes going into China has been between 1 million and 3 million barrels monthly.
Reuters’ data confirms earlier reports from, which repeatedly warned that Iran’s oil exports have not fallen by as much as official shipping data suggests: NIOC tankers began switching off their transponders to conceal their routes earlier this year.
WTI is holding. Holding above $69.

Natural gas is down 2.6% today. Link here.

The Animal Husbandry Page

Fill in the blank:
calf : yearling : cow :: lamb : ______ : sheep
For those who have the book, the answer is on page xlvii, Aenied, Virgil, translation by Frederick Ahl, c. 2007.

All About The Bakken -- It's Not Over Until It's Over -- The DAPL -- Now Playing In Two Courts -- October 18, 2018

Playing in two theaters now, perhaps this movie will go into wide release in 2019. Wow, this gets tedious.  

The DAPL's fate in Iowa is in the hands of the Iowa Supreme Court, if I haven't lost the bubble -- their ruling is expected in mid-November, certainly before the end of 2018.

Meanwhile, now this from The Bismarck Tribune, dated about midnight, October 18, 2018:
North Dakota landowners who unsuccessfully sued the developer of the Dakota Access oil pipeline for allegedly underpaying for land easements are maintaining that not all of their claims should have been thrown out by a federal judge.
Attorneys for the 21 landowners are scheduled to take their argument before an 8th U.S. Circuit Court of Appeals panel in St. Paul, MN, today. They want the case sent back to federal court in North Dakota to resolve at least some of the claims.
The landowners sued in January 2017, alleging a company formed by Texas-based Energy Transfer Partners and a hired land acquisition consulting business used deception to acquire private land easements for the $3.8 billion pipeline built to move North Dakota oil to Illinois. They sought more than $4 million in damages.
U.S. District Judge Daniel Hovland a year ago sided with the defendants. He ruled that the landowners had failed to prove their claims, in part because fraud-based claims under federal court rules require a higher standard of proof. Hovland said the plaintiffs "clearly failed to specifically allege who made the fraudulent statements, when the statements were made, and to whom the statements were made."
The landowners in their appeal maintain that not all of their claims were based on alleged fraud.
Perhaps the US Supreme Court ... 

Maybe it's time to take a page from the TransCanada playbook: sell the pipeline to the State of North Dakota. LOL. 

The good news: the track is still there for CBR. And CBR is scalable.

Too Much Litigation In The Northeast? I Don't Know
Or Simply Better Financial Prospects?

Meanwhile, another pipeline / pipeline company in the news. From
Kinder Morgan has decided to shelve its Utica Marcellus Texas Pipeline project, the company said at the presentation of its third-quarter financial results. Instead, Kinder Morgan said, it will focus on its existing Tennessee Gas Pipeline, which transports natural gas from the Gulf Coast in Louisiana to the northeast, including New York and Boston.
The UMTP was supposed to transport natural gas liquids from the Utica and Marcellus shale plays to the Gulf Coast in Texas. Back in 2015, the company filed with the Federal Energy Regulatory Commission to abandon the TGP project in favor of the UMTP, which would have had a design capacity of 430,000 barrels daily. Now, the company will instead start working on reversing the flow of the TGP and is looking for producer commitments for the route between Appalachia and the Gulf Coast.
Kinder Morgan exceeded analyst expectations with its third-quarter results, reporting a net profit of US$693 million and announcing a quarterly dividend of US$0.20 per share. The net result compares with US$334 million booked in the third quarter of 2017. Cash flow also improved, rising 4 percent from Q3 2017 to US$1.1 billion, Kinder Morgan said.
No reason given? On the other hand, from the same linked article:
At the same time, the company made a final investment decision on another pipeline, this time in the Permian, where producers have been faced with growing pipeline bottlenecks as production grows faster than the pipeline network. Kinder Morgan said it had secured sufficient long-term commitments for the Permian Highway pipeline to begin construction.

The Market, Energy, Political And Meme Page, T+66 -- October 18, 2018 -- Nothing About The Bakken

This is another example of a meme. My hunch is that Sir Saint Obama is incredibly bright and knows the power of a meme. The interesting thing is that the "Pocahontas" / Elizabeth Warren joke has gone on much longer than I think a lot of folks anticipated -- and that is what makes it a meme.

One can listen to an hour or Rachel Maddow or three hours of Rush Limbaugh or two seconds looking at this graphic -- one of the three will last. By the way, the graphic below is a derivative of a much better graphic carrying this meme along in the national conscience.

Again, to be clear, the graphic is not the meme. The "idea" is the meme. It will cement Elizabeth Warren's legacy forever.

The power of the meme? Anyone who saw it cannot forget the photograph of Michael Dukakis sticking his head out of a tank.

The Aeneid

The 120-second introduction to the Aeneid

One of the problems I've always had with the Aeneid: the chronology and anachronism. Troy fell early in the 12 century BC (early, I suppose meaning closer to the end of the 13th century than the end of the 12th centur -- working in "BC" can be confusing) where the founding of Rome occurred at the same time as Carthage (814 BC) or 753 BC, the date used by historians. That's a lot of years to fill between the fall of Troy and the founding of Rome for one man, Aeneas, to fill.

I assume Roman schoolboys at the time of Christ, when reading the epic poem simply got over it (the chronology and the anachronism) and simply pressed on with the story.
In the Iliad, Aeneas says he is the son of Anchises and Aphrodite (Venus), and then traces his descent from Zeus through Dardanus (son of Zeus and Electra) and Erichthonius of Dardania. The latter was the father of Tros, the founder of Troy. Tros had three sons: Ilus (think Ilium Iliad); Assaracus, and Ganymede. Ilus was the father of King Laomedon and grandfather of King Priam (ruler of Troy during the Trojan War).

Assaracus was the father of Capys and grandfather of Anchises. So, Prince Paris and Prince Aeneas would have been cousins? Second cousins, it turns out, to Hector and Paris.

Moments before Achilles and Aeneas met mano a mano, Poseidon saves Aeneas from being killed ...
Poseidon observes that that Aeneas must be saved so that Dardanus' race will not die out. Zeus loved Dardanus above all his children by mortal women but Zeus had come to hate the "descent" of Priam. Therefore, Poseidon realized that Aeneas needed to be saved. Aeneas will become the king of the Trojans, as well as the sons of Aeneas -- and they will rise again in Italy (Rome).
And that is what the Roman schoolboys at the time of Christ were taught: they were the heirs of the great city of Troy and looked upon favorably by the God of all gods, Zeus. Sort of like the special relationship the Jewish people had with their God, the chosen people.

Virgil's biggest problem? Reconciling his story of Aeneas with the prevailing story of Romulus and Remus.

This was how it was done. A Roman poet, Ennius, who preceded Virgil by 150 years or so, suggested that Aeneas was the father of Ilia (and presumably the ruler of Lavinium), grandfather of her sons Romulus and Remus.

Once Romans realized the chronological gap between the Homeric age of Troy and Rome's foundation, they needed king-lists to fill it, and so the tradition arose, that there were fourteen generations of Alban kings between Aeneas' son and Numitor, the father of Romulus.

Frederick Ahl notes:
Jupiter allows three hundred thirty-three years in all from Aeneas' foundation of Lavinium to the birth of Romulus. Even so, the numbers fall short.
Wow. Sort of reminds me of the list of kings in the Bible. Harold Bloom, no doubt, also noted that.

The Daily Note -- Nothing About The Bakken

The current page is getting too long. Time to start a new page. This is day +66 of the "Iranian Sanctions" concern, though I don't think full Iranian sanctions go into effect until sometime in November, 2018.

So far, despite all the hand-wringing, Iranian sanctions have not changed anything as far as I can tell.

October 18, 2018 -- T+66: MLB World Series, 2018, on deck --
  • Boston Red Sox, lead series over Houston, 3 - 1, best of seven
  • Dodgers vs Brewers, too close to call, 3-2, best of seven (if I were a betting man, I would bet on the Brewers, but they have to win two in a row to advance to the World Series)

Iran Sanctions
Days 67 -- present 

Fight's Back On: Let The Trade Wars Begin (A Bust)

Fight's On: Trump Exits "The Iran Deal" (A Win)
Fight's On: Let The Trade Wars Begin (A Bust)
The 38 Days Following The Schumer Shut-Down (A Bust)
The 2 Days of The Schumer Shut Down (A Bust)
The Last 65 Days of His First Term
Days 331 - 365
Days 301 - 330

The Trump Presidency (201 - 300)
The Third 100 Days
The Second 30 Days 
The First 30 Days

Between Election And Inauguration (1 - 100)
The Third 10 Days