Normally, I would do some posting of links, and would be doing the links to The Wall Street Journal but I'm not really in the mood right now. Maybe later.
I think what really got me in the mood to do some idle rambling was the op-ed piece by the publisher, Dickinson Press. Some of the best things the US Air Force did for me was to encourage me to never quit reading, to put things into perspective, to be optimistic, to keep trying to make things better. The Air Force sent me to any number of courses, symposiums, and conferences on strategic planning and quality improvement. The military puts a huge emphasis on continuing education. In the Air Force, it was the expectation that enlisted would have their college degree upon enlistment, or get it while on active duty. Officers were expected to get an advanced degree, often a master's degree in business. But all of us were expected to keep reading.
When I read the op-ed linked above, all that I could imagine was that the writer had quit reading some years ago. To write what he wrote was simply incredible, as in unbelievable. It certainly explains the general content of the newspaper.
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On a completely different note, I don't know if anybody is really following this story out in California. It's not about the Bakken. Because one has to read multiple sources and then connect some dots, it's unlikely The Dickinson Press publisher has noted this.
Over the past six months there have been reports that two major oil companies, Chevron and Conoco, have been moving their folks out of California, to Texas. There are three reasons: a) the oil industry is shifting back to Texas after years of relative neglect; b) the Californians in general do not appreciate the oil and gas industry; and, c) Governor Brown has just signed legislation that will regulate fracking for the first time in the state's history. The fracking legislation is benign in the big scheme of things, probably, on paper, no worse than the North Dakota regulations (do not take that out of context; there are significant differences).
In addition, it looks increasingly obvious to the casual observer that California shale will not be an easy nut to crack. Predictability of the shale seams are incredibly important in horizontal drilling; all the tectonic shifting have disrupted that linearity, and it will create havoc for drillers. There' s a reason it is called horizontal drilling: the drill bit goes horizontal. In the Monterey Shale, the drill bit is going to be all over the subsurface landscape trying to find the seam.
So, politically and geologically, the oil companies will find California an increasingly challenging environment. Regular readers saw that coming two or three years ago with random posts of oil activity in California. The proof in the pudding was the first article about Chevron moving its northern California employees to Houston, and then the more recent article (this week), Conoco, I believe, moving a significant number of employees also to Houston.
Then this: for the second consecutive month California noted an increase in the unemployment rate, and they were not trivial increases. The unemployment rate in California is now 8.9%. The only good thing about that number is this: it is not 9.0%. If the unemployment rate hits 9.0% when the rest of the global economy seems to be turning, it will be a very bad omen indeed for the Golden State. In fact, it doesn't take a rocket scientist to connect the Fed's decision to continue buying bonds with no "tapering" and the unemployment rate in California. I forget, but I think California has the largest state economy in the union.
When oil and gas jobs disappear there is a trickle down effect, when support services are affected. It's no wonder that North Dakota and Texas are shipping increasing amounts of oil to California.
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