Tuesday, August 30, 2016

Number Of Active Rigs In North Dakota Increase A Bit -- August 30, 2016

Active rigs:


8/30/201608/30/201508/30/201408/30/201308/30/2012
Active Rigs3376194185191

Wells coming off confidential list Wednesday (and Thursday and Friday and ... ): None.

One new permit:
  • Operator: BR
  • Field: Dimmick Lake (McKenzie)
  • Comments:
Ten producing wells (DUCs) completed:
  • 27652, 1,243, Petro-Hunt, Klatt 145-97-19C-18-5H, Little Knife, t8/16; cum --
  • 30387, 308, SM Energy, Shawn 1B-15HS, West Ambrose, t8/16; cum --
  • 30388, 278, SM Energy, Heather 1B-15HN, West Ambrose, t8/16; cum --
  • 30405, 215, SM Energy, Alvin 1B-15HS, West Ambrose, t81/6; cum --
  • 30406, 404, SM Energy, RM Federal 4-15HNB, West Ambrose, t8/16; cum --
  • 30407, 439, SM Energy, RJ Federal 4B-15HN,West Ambrose, t8/16; cum --
  • 30408, 459, SM Energy, DK Federal 4-15HNA, West Ambrose, t8/16; cum --
  • 30409, 369, SM Energy, Gladys 4-15HS, West Ambrose, t8/16; cum --
  • 30424, 926, Hess, HA-Sanford-152-96-1819H-9, Westberg, t8/16; cum --
  • 31949, 463, Petro-Hunt, Glovatsky 145-98-24D-13-1HS, Little Knife, t7/16; cum --
Two more EOG West Clark wells renamed to reflect change in"SWD" status:
  • 31247, see below, EOG, West Clark 103-0136H, was West Clark 201-01SWD, Clarks Creek, see yesterday's post;
  • 31249, see below, EOG, West Clark 201-01SWD, was West Clark 105-0136H, Clarks Creek,
***************************************
The EOG Wells Noted Above With SWD Notations

31249, see below, EOG, West Clark 201-01SWD, was West Clark 105-0136H, Clarks Creek:

PoolOil RunsMCF Sold
6-2016187119

31247, see above, EOG, West Clark 103-0136H, was West Clark 201-01SWD, Clarks Creek:

DateOil RunsMCF Sold
6-20163711883594
5-20161626428547

Social Security Administration Stepping Back From Text-Sent Password To Access One's Social Security Account -- August 30, 2016

Why I love to blog: some weeks ago I mentioned that the Social Security Administration was going to require a text-sent password to access one's social security account. Because I don't get text messages on my old-fashioned clam shell phone, I was out of luck. I would not be able to access my social security account on-line.

Well, today, I see the SSA has had a change of heart. From an e-mail received just moments ago:
On July 30, 2016, we began requiring you to sign into your my Social Security account using a one-time code sent via text message. We implemented this new layer of security, known as “multifactor authentication,” in compliance with a Presidential executive order to improve the security of consumer financial transactions.  SSA implemented the improvements aggressively because we have a fundamental responsibility to protect the public’s personal information.
However, multifactor authentication inconvenienced or restricted access to some of our account holders. We’re listening to your concerns and are responding by temporarily rolling back this mandate.
As before July 30, you can now access your secure account using only your username and password. We highly recommend the extra security text message option, but it is not required. We’re developing an alternative authentication option, besides text messaging, that we’ll begin implementing within the next six months.
Obviously SSA employees, working inside the beltway with high wages and state-of-the-art mobile devices are entirely out of touch with the average American. They must have gotten an earful from taxpayers, senators, and representatives. 

Update On Shell In The Permian -- August 30, 2016

I haven't followed Shell very closely for two reasons:
Earlier today Don sent me a link to a short but very interesting article regarding Shell. Shell sold its position in the Gulf of Mexico:
In a deal that included $425 million in cash, Royal Dutch Shell said it sold off its entire stake in assets held in the U.S. waters of the Gulf of Mexico.
The article then goes on to say that Shell is going to concentrate where prospects are better.

I think there are several story lines here.

The first one I have is the most controversial and it's likely no one will agree with me, except for members of the alt-right conspiracy. It's not mentioned in the story, but I think the CEO gave some thought to liability risk in the GoM. He saw what the US government did to BP and that story is still not over. Trying to take all your money is one thing but drawing the "case" out Dickens-style is probably worse. At least when you've lost all your money, you can quit and move on. There was a hint of that concern in the linked article:
Shell this year closed down production briefly after observing sheen in the region. More than 2,000 barrels of oil were released into the U.S. waters of the Gulf of Mexico about 97 miles from the southern tip of Louisiana from operations the company's Glider oil field.
In the New Oxford English Dictionary, sheen is defined as a thin-layer of oil, that when found in US waters, will precede a multi-billion dollar settlement in favor of the government.
Adding a bit of support to that argument, note the first paragraph again:
In a deal that included $425 million in cash, Royal Dutch Shell said it sold off its entire stake in assets held in the U.S. waters of the Gulf of Mexico.
At the end of the article, this paragraph:
Shell said it maintained a strong portfolio of assets in the Gulf of Mexico and plans are to increase output from established reservoirs. The Brutus/Glider assets combine for about 25,000 barrels of oil equivalent in production per day, or less than 5 percent of its total output.
So, there you have it. Shell departs the US GOM and remains in the GOM, but outside of US jurisdiction.  [Note: to keep comments to a minimum, I focused on an actual spill, risk, sheen -- I did not comment on all the US regulatory headwinds operators face in the Gulf.

A second story line:
This year, the company said it was leaving oil and gas operations in as many as 10 countries, while focusing more heavily on gas-rich Australia and shale opportunities in the United States.
Throughout the blog, I've posted a number of links to articles highlighting plays were Shell is leaving, including the Arctic. 

The third story, also in that paragraph: to focus on shale opportunities in the United States. Shale plays in the US were not identified by name. In the very first article linked at this post, it was noted that Shell was not one of the top five operators in the Permian. Right now, of the three top shale plays in the US (Bakken, Eagle Ford, and the Permian), the Permian is, by far, getting most of the attention. One can add Oklahoma's STACK/SCOOP, I suppose.

There's a fourth story line, but that came as a result of the article linked below. The fourth story line: the majors were slow to catch on to onshore fracking.

When searching my own blog, I don't see (m)any references to Shell and the Permian. But through google, I found this story, from Rigzone, June 21, 2016 -- just a couple of months ago, with these data points:
  • Shell acquired its Permian acreage from Chesapeake Energy in 2012
  • the company believes it position in the Delaware is the best of any operator there, in terms of size and rock quality
  • Shell holds 300,000 net acres in the Delaware through a joint venture with Anadarko Petroleum
  • 5,000 future wells identified
  • estimates: 2 billion boe
  • three plays in the Wolfcamp: 
    • the well-developed Bone Spring III
    • the Avalon
    • the Bone Spring II
  • sees multiple benches in the Bone Spring III
  • focus: longer laterals and more wells / pad
  • EURs: increased by 130% over past two years; estimates EURs will increase another 20% this year
  • breakeven price: $35 - $50 / bbl
  • improved performance due to:
    • fracking long laterals: to date, Shell has drilled two 10,000-foot lateral
    • sweet spot selection
    • eliminating (selling) non-core acreage drilling
  • the company wants to drill laterals as long as possible without adding significant cost (the drilling is not the long cash-pole in the teepee; it's the fracking)
  • asset swapping is how operators are maximizing operations now: companies swapping Permian acreage -- Shell, Anadarko, EOG

Summer, 2016 -- As Seen By Vern Whitten

Western North Dakota, my favorites:
  • the new Williston High School
  • the new Watford City High School
  • new track crossing in Dickinson
  • the new Middle School in Dickinson 
  • look how fast those cement walls go up (Watford City High School)
  • how beautiful the landscape is around the pads (slide 20); decades from now, these wells will be shut in, taken out of production; and the land reclaimed; and much of North Dakota will return to what it was 500 years ago; archaeologists from some planet near PSR J1302-6350 may look for signs of these pads in the year 8510 (with apologies to Zager and Evans).
Central North Dakota to west-central Minnesota, my favorites:
  • the lakes and forests in Minnesota
  • most sad: Devils Lake area
West Fargo, Fargo, and Moorhead, my favorites:
  • flood wall, under construction
  • Bluestem Center for the Arts
  • handicapped accessible launching ramp for kayaks, canoes (wow)
  • Microsoft, south Fargo
  • Dakota Boys Ranch, south Fargo
  • classic car show, Walmart, south Fargo
Okay, okay -- I love all the Fargo-area pictures, because I so seldom get to see that part of the state.

This is just a small, small microcosm of the whole Great Plains -- Mr Whitten gives new meaning to "the fly over states."

These pictures are incredible and continue to remind me how great this country is.

I am sure Mr Whitten would love to hear from you, especially if interested in any prints.

His business card:

Vern Whitten Photography
(701) 261-7658

Idle Chatter, Observations Regarding The US Economy -- Consumer Spending; The NYSE -- August 30, 2016

Updates

Later, 4:46 p.m. Central Time: consumer spending links? See first comment.
 
Original Post
 
With regard to the "market" and investing, there are two interesting stories right now (and by noon, the stories will be history and we will have moved on to something else, perhaps a new Trump/Hillary poll, or another story about Barbara Streisand threatening to move to Ireland if The Donald wins). By the way, it was interesting to note that the Clinton camp was able to persuade the very camera-shy and reclusive Ms Streisand to appear on late night television.  It is also interesting that Trump's lead in the LA Times/USC poll jumped significantly after that appearance. But I digress.

Now what was I talking about? Oh, yes, with regard to the "market" and investing, there are two interesting stories right now.

This is the first:
This is the second story, from The Wall Street Journal:  U.S. consumer spending rose in July. Domestic consumption could continue to drive economic growth over the second half.
Personal consumption, which measures how much Americans spent on everything from hotel stays to hamburgers, rose a seasonally adjusted 0.3% in July from a month earlier. Incomes rose 0.4%, a pickup from growth in the prior two months.
I assume the folks who derive these figures use very complicated formulas but at the end of the day, it's my understanding that they simply measure "dollars spent."

Some random data points or observations that might lead to further discussion at a Williston coffee shop, or not:
  • seasonally adjusted, Americans drive about the same amount of miles day in / day out. Sure, the amount of driving is affected by a gazillion factors, but at the end of the day, the law of "large numbers" tends to win out. If one accepts that assumption, then US spending on gasoline will be considerably less over the course of one month if the average price is $2.00/gallon vs $4.00 gallon
  • cheap gasoline does not only affect cost of driving, but everything that involves transportation, including food
  • without question, the sector that shows the most increase in prices is health care, particularly ObamaCare premiums; that cannot be disputed; so, if Americans are spending more on health care (and getting about the same amount) or spending more on ObamaCare premiums (and still paying out-of-pocket until the annual $6,000 deductible is met), US consumer spending will increase.
Maybe "they" don't count insurance premiums as part of consumer spending. Maybe they don't count money spent on health care as "consumer spending." Shoot, just the 500% increase in EpiPens will increase the amount US consumers spend, all things being equal. I don't know. Maybe there's a big spreadsheet somewhere that shows us what is included in "consumer spending."

*************************************
The Music Page

For reasons I won't go into, I happened to catch two "specials" on our local PBS station last night -- when the "specials" are this good, one knows that PBS is having one of its monthly two-week fundraising events. At least these events seem to come once a month, and when they do, they seem to last two weeks. And another truism: one can be guaranteed an opportunity to binge on the British comedies during those two weeks. But again I digress.

The two specials last night: a 90-minute documentary on The Mamas and the Papas, and a similar documentary on the Beach Boys or California surf music -- I don't know how long it lasted; I fell asleep sometime during the show.

But they were both incredible.

Only one or two comments. The Mamas and Papas were around for only 2.5 years. It is incredible how much they packed into those two years. In addition, it is unlikely -- except for Cass Elliot -- that any of them had any significant voice lessons prior to (or maybe even during) their 2.5 years of incredible hits. And despite that, their voices and their singing was ... for lack of a better word, incredible. Let's see -- I've used "incredible" at least four times in the past few sentences to describe The Mamas and The Papas.

The other comment: Michelle Phillips may have been the most physically abused individual -- and perhaps emotionally abused as a result of the physical abuse -- of the group, and here she is, still alive, having outlived the other three, and at least for the documentary, as beautiful as ever, and as positive as ever about her life with the group.

Okay, enough of that.

******************************
Crocodiles And Alligators
A Note For The Granddaughter Who Wants To Become A Marine Biologist

From Crocodiles and Alligators, consulting editor, Charles A. Ross. No copyright date or publishing date provided.

Archosauria: ruling reptiles; dominated animal communities on the continents during the Mesozoic Age (245- 65 million years ago); included:
  • dinosaurs
  • pterosaurs (flying reptiles, not dinosaurs)
  • crocodilians
  • thecodontians (included a variety of primitive archosaurs, some of which may have been the precursors of later groups such as crocodilians
Archosaurs: one of the most successful groups of land-dwelling vertebrates ever known; living crocodiles are the only living representatives of this group

Crocodiles more closely related to birds than to lizards (despite the largely superficial resemblance).

The next closest relatives of crocodilians among living vertebrates: lepidosaurs, or scaly lizards
  • tuatara of New Zealand
  • lizards
  • snakes
Archosaurs: two temporal fenestrae behind each eye socket: delimited by horizontal bony arches; one opening is high upon the skull roof; the other is down on the side of the cheek.

Two theories for these two temporal fenestrae:
  • an area where jaw muscles could "reside" during jaw closure
  • flying buttress analogy: lighter and stronger
These two fenestrae -- or openings -- behind each eye socket: distinguishing feature of the diapsid or "two-arched" reptiles.
  • lizards: the lower bony arch is always incomplete
  • snakes: both the lower and upper arches are absent, leaving the entire cheek open
  • crocodilians: retain the typical diapsid configuration
  • birds: the large eye and the considerably expanded braincase have encroached on the cheek region and consequently the bony bars between the eye socket and the two openings have largely disappeared
By comparison: mammals, including hamans
  • only one opening for the jaw muscles behind the eye socket (synapsid condition)
By comparison: turtles
  • a solid roofed cheek; no openings (anapsid condition)
Classification systems
  • phenetic: based on structural similarity
  • cladistic: based exclusively on how long ago two organisms shared a common ancestry
  • eclectic: draws selectively on information from both cladistic and phenetic approaches
Using the eclectic system: crocodilians aligned with the lizards; and that is the classification used by these scientists contributing to this book

Nile Crocodile
  • Kingdom: Animalia
  • Phylum: Chordata
  • Subphylum: Vertebrata
  • Class: Reptilia
  • Order: Crocodylia
  • Suborder: Eusuchia (modern crocodilians)
  • Family: Crocodylidae (alligators, crocodiles, and relatives)
  • Subfamily: Crocodylinae (crocodylines)
  • Genus: Crocodylus (true crocodile)
  • Species: Crocodylus niloticus (Nile Crocodile)
Geological Time
  • Phanerozoic eon: appearance of most multicellular life forms 
  • phanerozoic: means visible life
  • three eras
    • Paleozoic (old life) - 590 245 mya -- Age of Reptiles or Age of Dinosaurs; first appearance of crocodilians in the fossil record
    • Mesozoic - first appearance of of the majority of groups that populate existing environments: birds, mammals, advanced bony fishes, most living insects, angiosperms (flowering plants); also marks the arrival and reign of dinosaurs and the rise to dominance of both major lineages of diapsid reptiles and is therefore aptly referred to as "The Age of Reptiles" 
    • three periods 
      • Triassic
      • Jurassic
      • Cretaceous 
    • Cenozoic -- new life -- from 65 mya; mammals, birds, insects, and flowering plants  quickly rise to dominance
Crocodiles that could be assigned to present crocodiles and alligators: first definitely known from the Campanian stage of the Upper Cretaceous, some 80 million years ago.

FAQ: How Much Sand/Ceramic Is Used To Frack A Typical Well In The Bakken?

Over at FAQs, this was the posting as of August 30, 2016, and obviously needs to be updated:
[Update: October 21, 2014].  Click here for update posted in early 2011. [October, 2011: I am starting to track fracking specifics: it turns out some companies, like Hess, are using less than 1 million pounds of sand to frack, whereas some companies like BEXP are using up to 4 million pounds of proppant (sand plus ceramics); and sometimes the amount of ceramics used is more than the sand.] [Update: June 9, 2015. When I first started blogging, one million lbs of sand was common and then, as noted, BEXP pushed it to 4 million lbs. Maybe two years or three later EOG, with its own sand mines in Wisconsin pushed it to 10 million lbs for a long lateral. Now, EOG has used almost 20 million lbs in a long lateral.]
Updates

August 20, 2016: Mike Filloon talks about mega-fracks --
  • Mega-fracs continue to use large volumes of sand per well, with some operators now using up to 3,000 lbs/ft
  • The combination of increased locations completed in the STACK, Delaware and Midland basins with enhanced completions using up to 30,000,000 lbs per well could aid in increasing sand pricing
  • Frac sand producer stock prices have improved, significantly from earlier this year but with demand growing at its current pace there could be extended gains into year end 
In the Bakken in North Dakota there is very little fracking being done in 2016 due to depressed commodity prices. However, of the wells that have been fracked in the past twelve months, it appears that for a long lateral:
  • number of stages: 35 - 45 stages seems typical; there are few exceptions on the low side; more exceptions on the high side
  • sand/ceramic: 4 million lbs to  8 million pounds seems typical; again, there are few exceptions on the low side; more exceptions on the high side.
 

Statoil's Huge North Sea Field Profitable At $25 Oil; Big Shift In Energy Fundamentals -- RBN Energy -- August 30, 2016

Samson Resources signs new Chapter 11 exit plan -- WSJ
Tulsa, Okla.-based Samson is battling junior creditors in bankruptcy court and must either defeat them or win them over in order to make the restructuring proposal a reality.
The agreement signed Friday pledges investors holding 39% of Samson’s second-lien loan claims to support a new chapter 11 plan that should be filed within days.
When it filed for bankruptcy protection in September 2015, Samson was weighted down with about $4.9 billion worth of debt. It had a deal in hand, but falling energy prices continued to chop into the value of Samson’s assets and the pact fell apart.
Although is it increasingly difficult for a one-man band to keep this data updated, I track Bakken operators at this post

Statoil slashes CAPEX but will still see a 40% increase in initial daily production capacity from that field.
Norway’s Statoil AS A has slashed billions of dollars off planned spending on the giant Johan Sverdrup field in the North Sea, ensuring it should remain profitable even if oil prices fall to around half current levels.
The state-controlled oil producer also forecast as much as a 40% increase in initial daily production capacity from the field.
Again, note: Statoil's Johan Sverdrup field in the North Sea should remain profitable at $25 oil.

The WSJ sees the other side of the coin:
The recalibration of one of Norway’s biggest-ever oil projects—a rare example of a major investment that has gone ahead since the collapse in oil prices in the past two years—shows the pressure oil producers including Statoil are still under with oil prices hovering below $50 a barrel.
I guess it depends how you want to see / tell the story.

For the WSJ, the emphasis is on Statoil slashing CAPEX.

For Saudi Arabia: Statoil's giant oil field should still be profitable if oil prices fall to $25 oil. Twenty-five-dollar oil is an existential issue for Prince Salman.  

See the RBN Energy story below (and the Richard Zeits' article yesterday): $50 oil is the new $80.

*******************************
ATT Just Got Better (Or Bigger)

Zacks
Telecom and pay-TV behemoth, AT&T Inc. has inked a deal with HBO that will enable it to deliver Time Warner Inc. TWX-owned HBO’s content across multiple platforms through satellite, online streaming and cable-based U-verse. Notably, AT&T is launching its online streaming service Over The Top (OTT) DIRECTV Now by the end of this year owing to the gaining popularity of the business model across the millennial population.

The online streaming service is gaining momentum as is evident from the growing success of companies like Netflix Inc. NFLX, which is a leading player in this segment. This has resulted in massive subscriber losses for the pay-TV operators.
To counteract the churn rate, many pay-TV operators are implementing this model and AT&T is no exception. We believe that the addition of HBO’s content, which features immensely popular TV series like Game of Thrones, will help the company gain subscribers in its new platform. However, AT&T is a late entrant in this industry and it remains to be seen whether it can compete against the already established players in this segment.
And while we are on the subject of ATT, here's another Obama administration ruling that was overturned by the court:
A federal appeals court threw out a government lawsuit against AT&T Inc. that alleged the company misled wireless subscribers by selling them unlimited data plans and then quietly slowing down service if they consumed high amounts of data.
Monday’s ruling, from the San Francisco-based Ninth U.S. Circuit Court of Appeals, is a blow to the Federal Trade Commission, which filed the suit in 2014 seeking potential refunds for consumers. 
Although the FTC has broad authority to police unfair and deceptive commercial practices, it doesn’t have authority over “common carrier” phone services such as the landline services traditionally offered by AT&T. The commission had said it could pursue the company, however, because it involved data services, but the appeals court rejected that argument.
The ruling further solidifies the FTC’s diminishing authority in the telecommunications space. The consumer protection agency already was facing reduced enforcement powers thanks to open-Internet rules the FCC put in place last year. Those rules imposed common-carrier obligations on broadband services, including wireless.
***********************************
Back To The Bakken

Active rigs:


8/30/201608/30/201508/30/201408/30/201308/30/2012
Active Rigs3176194185191

RBN Energy: Big shift in energy fundamentals. RBN Energy seems to agree with Richard Zeits. $50 oil is the new $80 oil.
U.S. crude oil prices languish below $50/bbl, but the oil-directed rig count is up by 90, an increase of almost 30% over the past 12 weeks.   Natural gas production is down less than 1% from the all-time high hit back in February even though the price of natural gas remains below $3/MMbtu.  The price spread between U.S. propane and international markets is far below a level that should justify exports, but LPG exports to overseas markets continue at astronomical levels –– approaching 700 Mb/d, most of which is propane. What’s wrong with this picture?  Why does it seem that relationships between energy production, demand and prices have broken down, or at least have undergone some fundamental shift?  That is what our upcoming School of Energy Fall 2016 is all about.   
At first glance, a number of energy market relationships may seem to have shifted, but the reality is that we are just looking at the market from a different perspective than ever before – the recovery from a Shale Revolution crude oil price crash.   Two years ago U.S. hydrocarbon markets entered Shale 2.0.  (Sorry about using such a tired old metaphor, but it works.)
Back in 2007-09 before the Shale Revolution started to impact markets (labeled Pre-shale), gas, NGLs and crude tended to move in tandem.  Moving in almost perfect correlation, all three of these markets blew out in the commodity run-up of 2008 and all crashed with the Great Recession.   
But by then shale had come to natural gas, and pricing for gas, NGLs and crude diverged (the Shale Gas era).  Natural gas oversupply kept prices low while crude and NGLs recovered along with the global economy.   That motivated producers to move to wet gas – containing lots of NGLs, because NGL prices were still strong.  U.S. hydrocarbon markets entered the Wet Gas era.
****************************** 
Update On California's Bullet Train 
First Leg Ends In Almond Orchard In Middle Of Nowhere

From The Los Angeles Times:
The state’s plan to build an initial stretch of high-speed rail line, from San Jose to a map point in the midst of Central Valley farmland, came under renewed attack at an oversight hearing Monday. 
The apparent absurdity of the abbreviated route was not lost on supporters. 
“It seems odd,” acknowledged Dan Richard, chairman of the rail authority, “to be stopping in the middle of an almond orchard.”
The words of the rail authority chairman: "It seems odd to be stopping in the middle of an almond orchard."

I can't make this stuff up.

********************************
More Good News For US Natural Gas Industry
Australian State Of Victoria Bans Fracking

Reuters:
The state of Victoria plans to ban shale and coal seam gas fracking in what would be Australia's first permanent ban on unconventional gas drilling, citing the concerns of farmers and potential health and environment risks.

However the government left the door open to allowing onshore conventional gas drilling after 2020.

The decision was made despite the fact that most of eastern Australia's gas supply is produced from coal seam gas and comes as a blow to manufacturers who have been clamouring for more gas supply to help keep prices down.

Gas supply has become an issue following the opening of three liquefied natural gas (LNG) export plants in the state of Queensland, which together are set to triple gas demand in eastern Australia by 2018 from 2014.
************************
The Market

Closing: uneventful day; the market (Dow 30) closed 49 points down; oil dropped below $47. NYSE --
  • new highs: 153; BRK-B traded at a new all-time high, now over $150; the banks are reporting record (?) profits and Warren Buffett loves banks
  • new lows: 5; add Noble Energy to ITT
Early morning: for a market that is looking for a reason to go down ("correct") and for all the talk about a "bubble" in the stock market, it is interesting to note that on a day when the market is down, there are 124 issues on the NYSE that hit a new high (many on opening; and, are now pulling back a bit); and only one issue that is trading at new lows -- ITT -- and that's due to force majeure.

Opening:  opens slightly up, essentially flat. AAPL drops 40 cents, down to about $106 after the huge EU tax story. It sounds like Ireland has the problem, not Apple. Apple was in compliance with Ireland's tax law and Ireland agrees. The EU says Ireland is at fault and wants Ireland to collect $14 million (plus interest) in back taxes from Apple. Isn't going to happen. [I may be wrong, but it seems the Drudge Report headline is in error. Drudge says the EU orders Apple to pay $15 billion in back taxes. I believe the EU told Ireland to collect that money -- whatever the final amount is -- from Apple. To the best of my knowledge, the EU did not send a tax bill to Apple. If anything, the EU sent a tax bill to Ireland. But I could be wrong.] NYSE:
  • new highs: 124 - BRK-B (a big whoop); Loews; OXY (a huge whoop -- for the record, I don't own any OXY; I don't think I've ever owned OXY and have no plans to ever buy OXY);
  • new lows: 1 -- ITT (Obama brought 'em down)

Monday, August 29, 2016

Richard Zeits On The Bakken -- Optimistic -- SeekingAlpha -- August 29, 2016

Mike Filloon has had four articles on the Bakken recently and now we have an article from Richard Zeits. This all suggests to me, along with other stories coming out of the Bakken, that things are "happening."

The newest contribution from Richard Zeits: shale oil -- the "upcycle" is already underway.

Summary:
  • For U.S. shale oil, $50 per barrel is the “new $80” - a result of the industry's evolution since the beginning of the downturn in oil.
  • Capital spending and capital availability will continue to be forward-looking: operators and investors will anticipate improvements in drilling economics.
  • Using the current strip curve, activity acceleration is sustainable and should become particularly visible in 2017.
The article will disappear over time.

The comments are incredibly good. I particularly liked the comment about shareholders: agree 100%. I think a lot of folks forget that.

**************************
Cool -- 
Marijuana State Hasn't Lost All Sense
Hunter S Thompson Would Be Proud

Colorado anti-oil initiatives fall short of qualifying for ballot.
Two proposed initiatives that would have increased restrictions on oil and gas activity in Colorado failed to make the November 8, 2016, ballot because they did not collect enough valid signatures.

Officials of the Colorado Oil & Gas Association (COGA) and the Colorado Petroleum Council (CPC) separately welcomed the news.
Backers submitted the signatures in early August. Initiative No. 75 would have let local governments to prohibit, control, or impose moratoriums on oil and gas development; enact local laws that are more restrictive than state laws; and bar the state from preempting such law.

Initiative No. 78 would have changed Colorado’s setback requirements for any new oil and gas development to at least 2,500 ft from the nearest occupied structure or other specified or locally designated area, and authorize the state or a local government to require that any such new development be more than 2,500 ft away from such structures.

News And Comment: Nothing About The Bakken -- August 29, 2016

One can only laugh. I canceled my subscription to The New Yorker about a month ago but I still "read" it every week at the Southlake Library. I canceled my subscription because the magazine had turned into a political mouthpiece for Hillary.

One of my favorite pieces in The New Yorker was always "A Reporter At Large." This week's story: "The Moscow Laundromat: How Deutsche Bank helped Russians spirit billions out of that country."

I wonder if next week we will see "The DC Laundromat: How President Obama helped Iran get its half-billion dollars back."

Or even, "The DC Laundromat: How Solyndra served as a conduit for Democratic campaign contributions."

Nope. Probably not.

*******************************
Two Staff Writers At The NY Times  
Recognize That ObamaCare Marketplaces Are In Trouble

This is an absolutely worthless article, but it provides readers an update on where things stand, what people are talking about and what they are considering. It's a fluff piece to say the least. If interested, google ObamaCare marketplaces are in trouble what can we do NY Times. 

Looks like Reed Abelson and Margot Sanger-Katz are two new nominees for the 2016 Geico Rock Award.

Rick Newman over at Yahoo!Finance has noted the same thing: ObamaCare is in trouble. It is interesting that mainstream media is finally willing to note the obvious -- now that President Obama is down to less than 150 days in office.

He has been so incredibly awful, even grandmother Hillary is starting to look good. 

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A Note For The Granddaughters
The Human Genome
Nature: The Human Genome
Editor: Carina Dennis and Richard Gallagher
c. 2001
DDS: 599.935 HUM

The genome size is usually state as the total number of base (A, T, C, and G) pairs; the human genome contains roughly 3 billion.

There is little correlation between the complexity of an organism and the size of its genome.
  • human genome: 200 times more DNA than yeast
  • human genome: comparable in size to that of frogs and sharks
  • human genome: dwarfed by the genome of the newt, with 15 billion base pairs
  • a single-celled micro-organism, Amoeba dubia, is 200 x bigger than the human genome
One thought: an Amoeba -- threatened by its environment much more than a human -- may need that size of toolbox. If the environment threatens me personally today, I can always flee. An Amoeba cannot flee very far nor very fast.
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Genes (in more complicated organisms than bacteria) are divided into sections that code for proteins, called exons (meaning "expressed sequences"), interrupted by non-coding spacers called introns (meaning "intervening sequences").

Human genes vary greatly in length; where the average protein-coding sequence of a gene is about 1,000 to 2,000 base pairs, long stretches of non-coding sequence interspersed between exons can extend the boundaries by 20,000 -- 100,000 base pairs. The largest known human gene, which encodes dystrophin (an important protein in the scaffolding of muscle cells), is 2.4 million base pairs long, of which only 14,000 actually code for the protein.

Less than 2% of the human genome is made up of protein-coding sequences. We do not understand what most of the other 98% of the human genome is there for.

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A selection of notable genomes that have been sequenced:
  • 1977: a bacteriophage; the first genome sequenced, 5,386 base pairs
  • 1995: Mycoplasma genitalium; smallest genome of any free-living organism; 580,000 base pairs
  • 1996: Saccharomyces cerevisiae; first genome of a "eukaryotic" organism; yeast used by brewers and bakers; 12 million base pairs
  • 1996: Methanococcus jannaschii; the first genome from the third kingdom, Archae, which comprises microbes that live in harsh environments; 1.7 million base pairs
  • 1997: Escherichia coli; workhorse bacterium for biologists; 4.7 million base pairs
  • 1997: Heliobacter pylori; bacterium assoc with gastric disease; 1.7 million base pairs
  • 1998: Mycobacterium tuberculosis; causes tuberculosis; 4.4 million base pairs
  • 1998: Caenorhabditis elegans; the first genome sequence of an animal, the roundworm; 97 million base pairs
  • 1999: Deinococcus radiodurans; highly radiation-resistant bacterium; 500 rads can kill a human being; some members of Deinoccocus can withstand millions of rads; 2.6 million base pairs
  • 1999/2000: Homo sapiens; first human chromosomes; chromosome 22 (HSA 22; 48 million base pairs); HSA 22, 45 million base pairs
  • 2000: Drosophila melanogaster; the fruit fly; important in laboratory genetic studies; 180 million base pairs
  • 2000: Vibrio cholera; causes cholera; 4 million base pairs
  • 2000: Arabidopsis thaliana; the first genome of a plant, the mustard weed; 120 million base pairs
  • 2001: Mycobacterium leprae; leprosy; 3.3 million base pairs
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Interesting: Nature says we have "24 chromosomes, 3.2 billion bases, and around 31,000 genes." Note: 24 chromosomes. Standard textbooks tell us we have 23 pair of chromosomes.

Human genome project: in less than 15 months, a draft sequence of 90% of the total human genome had been sequenced. The human genome sequencing project is of interest because:
  • it is the largest genome to be extensively sequenced so far
  • it is 25x as large as any previously sequenced genome
  • it is 8x as large as the sum of all such previously sequenced genomes
  • it is the first vertebrate genome to be extensively sequenced
  • uniquely, it is the genome of our own species
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LTR: long-terminal repeat
LTR retroposons: long-terminal repeat retroposons
SNPs: single nucleotide polymorphisms

EOG Changes Name Of Well To "SWD" Despite Great Initial Production -- August 29, 2016

Updates

August 30, 2016: see this post also
 
Original Post
 
Active rigs:


8/29/201608/29/201508/29/201408/29/201308/29/2012
Active Rigs3076194183190

No wells coming off confidential list Tuesday.

No producing wells reported as being completed

Five new permits:
  • Operator: BR
  • Field (County): Dimmick Lake (McKenzie County)
  • Comments: these are five Dodge permits in section 17-151-96; three middle Bakken and two Three Forks wells; all appear to be on one pad
Ten permits renewed:
  • Statoil (3): one Michael Owan and two Reitin permits, all in Williams County
  • Whiting (2): two Hecker permits in Stark County
  • HRC (2): two Forth Berthold permits in McKenzie County
  • Enduro Operating: one NSCU permit in Bottineau County
  • Resource Energy Can-Am: one Olav permit in Divide County
EOG change the name of file #31247:
  • 31247, conf, new name: West Clark 201-01SWD, was: West Clark 103-0136H -- production history:
DateOil RunsMCF Sold
6-20163711883594
5-20161626428547

I don't understand this. When a file name includes PNC it means the permit has been cancelled. I would assume "SWD" means a salt water disposal well, but it makes no sense for this to be a SWD based on production. The well is still listed as being CONFIDENTIAL

Screenshot of the area where #31247 is located: