Sunday, May 1, 2016

Halliburton, BHI Keystoned -- May 1, 2016

Updates

May 2, 2016: Baker Hughes lays out plans to cut costs.
Baker Hughes Inc. laid out a plan to cut costs and buy back stock and debt, outlining its path forward a day after its planned merger with Halliburton Co. was scrapped.

Baker Hughes said it would cut $500 million of costs and weigh a restructuring of its business, while buying back $1.5 billion of shares and $1 billion of debt. The funds for the buybacks will come from the $3.5 billion breakup fee Baker Hughes got from Halliburton as the deal was called off.
On Sunday, Halliburton and Baker Hughes walked away from their merger, once valued at nearly $35 billion, after regulators on several continents claimed it would hurt competition in the oil-field services business. 
I hope those who were adversely affected by Obama regulators remember this in November, though much of the pushback came from the EU.

Original Post

The Wall Street Journal  reports that Halliburton and Baker Hughes have called off their merger.
Halliburton Co. and Baker Hughes Inc. called off their merger, once valued at nearly $35 billion, which encountered opposition on several continents from regulators who claimed that it would hurt competition in the oil-field services business.
The merger would have hardly have been noticed by Joe Six-Pack or Wendy Wine Cooler, but if it had not been an oil and gas merger it would have sailed through.

The New York Times reports that the Charter - Time Warner Cable merger approved by regulators will create an Internet giant.
Charter’s $78 billion bid, on the other hand, has always been seen as more likely to clear regulatory hurdles.
Last year, research firm Leichtman Research Group estimated that Charter would end up with 18 million subscribers if the merger were approved, placing it ahead of AT&T’s 16 million subscribers but behind Comcast’s 22 million. In other words, it would make Charter considerably more powerful in the market, but it would still have large rivals to keep it in check.
Sure. 

By the way, earlier from the Motley Fool regarding the Halliburton - BHI merger:
Tied into the pending agreement is a $3.5 billion breakup fee that would pay Baker Hughes roughly $8 per share. According to Bloomberg, "at about 10% of the deal value, the breakup fee is far larger than the average of 4% paid by U.S. acquirers this year." Additionally, Halliburton issued $7.5 billion in senior notes to help fund the deal, leaving it overleveraged if the deal falls through. 
For Baker Hughes, a $3.5 billion breakup fee would probably be mitigated by the loss of any merger-related premium currently baked into the stock price. Additionally, losses at the company are greater than at Halliburton, causing many analysts to question how long Baker Hughes can operate as an independent company.
In February, Morgan Stanley downgraded shares because the market wasn't "pricing in the necessary risk associated with a potential failed deal." 
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On A More Pleasant Note, Talladega Was Incredible ... For Spectators

Yahoo!Sports is reporting:
Consider: Chris Buescher flipped three times. Danica Patrick upended Matt Kenseth. Kevin Harvick ended the day sliding across the fence on his roof.
All in all, millions of dollars' worth of cars ended up totaled, with the only winners—besides Keselowski, of course—being the scavengers who prowled the garage throughout and after the race, carrying off a fender or a bumper or a chunk of brightly-painted sheet metal.
The drivers were wrestling with more immediate concerns. Both Kenseth and Patrick allowed that they were a little nervous in the long instants before their cars collided with the wall. Kenseth said he prayed, while Patrick just closed her eyes ... until the fire started in the car, that is.
I thought it was a great race. Ticket-holders certainly got their money's worth. And no spectator was injured (as far as I know), nor were there any serious injuries among drivers. 

So, what's the beef?

For The GOP Convention, Could North Dakota Be The Swing State? LOL -- But ... May 1, 2016

The National Review is reporting that Cruz delegates are starting to waver:
Donald Trump’s romp through the Northeast last Tuesday abruptly changed the subject, the political world was captivated — and Trump supporters were infuriated — by the Cruz campaign’s successful effort to elect large blocs of friendly delegates at a series of state-party conventions. 
But friendly delegates are as subject to shifts in the race’s momentum as anyone else, and Cruz’s strength with some of these crucial first-ballot convention voters may be overstated — particularly in North Dakota, where his campaign declared victory after filling 18 of 25 unbound delegate slots with its chosen candidates at the April 3 convention
Those delegates are vital to Cruz’s quest to deny his rival the 1,237 delegates he’ll need on the first ballot in Cleveland. But as they’ve watched Cruz struggle to tread water in a primary increasingly dominated by Trump, many of them, wary of a bitter convention battle that could rend the party at its seams, are rethinking their commitment to the Texas senator.
And if there is one thing NoDaks don't like is anything that "could rend something at the seams."

We like it homogeneous, smooth, and like Obama, "no drama."

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Count Me Among The Disappointed

The New York Times on the Stephen Colbert show:
Things could be worse. Mr. Colbert still places second in overall audience — behind Jimmy Fallon on NBC, and ahead of Jimmy Kimmel on ABC.
But Mr. Kimmel has been beating Mr. Colbert among the younger viewers advertisers covet. And as Verne Gay of Newsday wrote, Mr. Colbert is lagging in the new currency of viral videos shared through social media.
Beyond that, there is the growing consensus that things just aren’t clicking.
I haven't watched Stephen Colbert since the first week it aired.

At 11:30 p.m. folks no longer want to listen to politics. Especially with a Rachel Maddow overlay.

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Count Me Among The Unsurprised

The Dallas Morning News is reporting that an $18,000 solar panel investment will save Texans $177/year. I can't make this stuff up.
Solar power is an unknown for most homeowners.
Ask Jim Lord of Duncanville.
He listened to a salesman from Global Efficient Energy of Fort Worth. On its website, the company teases that a reduction in energy consumption between 20 percent and 100 percent is possible. Wow.
The salesman talked Lord into buying five panels for his roof. He promised at least a 20 percent savings. Lord also paid for a radiant barrier, attic fans and window and door weather stripping. The whole enchilada.
Lord paid the $18,000 bill with a finance plan that calls for monthly payments of $300.
After a full year, Lord pulled out his electricity bills from pre-solar and post-solar to compare. He was surprised to see that his savings is only 10 percent, half of what was promised.
In one year, Lord says he saved about $177.
At that rate, his new system will pay for itself in another … (pause) … 93 years.
And then get this:
[The CEO of the company] patiently explained to me that energy savings is a two-way street. His people make the structural changes, but a homeowner must live an energy-efficient lifestyle, too.
But that doesn’t always happen. Because of that, he says, “We’re not doing any guaranteeing anymore. You can’t control what people do and how they live. That’s the biggest lesson we’ve learned as we’ve grown.”
And so it goes, from the sunny state of Texas.

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Count Me Among Those Who Don't Make Plans For The Day

Texans prefer not to make plans for the day because, when they do, the word premeditated starts getting thrown around in court. 

Speaking of which, the most common sign seen on retail store doors throughout California is the sign warning customers that cancer-causing substances are on the premises, a Proposition 65 requirement.

In Texas: "open carry not allowed" and they are not talking about booze.

Nine (9) More DUCs -- May 2, 2016

Monday, May 2, 2016
  • 30573, SI/NC, XTO, Rink 12X-4C,  Garden, no production data,
  • 31599, SI/NC, Hess, EN-Cvancara-155-93-1522H-5, Alger, no production data,
Sunday, May 1, 2016
  • 29736, SI/NC, WPX, Wells 32-29HD, Reunion Bay, no production data,
  • 29737, SI/NC, WPX, Wells 32-29HY,  Reunion Bay, no production data,
  • 31600, drl/NC, Hess, EN-Cvancara-LE-155-93-1522H-1, Alger, no production data,
  • 32121, SI/NC, EOG, Austin 437-2635H, Parshall, no production data,
  • 32122, SI/NC, EOG, Austin 436-2635H, Parshall, no production data,
Saturday, April 30, 2016
  • 32049, SI/NC, SM Energy, Hay Farms 14B-20HN, Skabo, no production data,
  • 32096, SI/NC, Hess, EN-Cvancara-LE-155-93-1523H-2, Alger, no production data,

Spacing Units In The Bakken

Posted March 2, 2016 (not likely to be updated in the future).

38-08-07. COMMISSION SHALL SET SPACING UNITS. The commission shall set spacing units as follows:

1. When necessary to prevent waste, to avoid the drilling of unnecessary wells, or to protect correlative rights, the commission shall establish spacing units for a pool. Spacing units when established must be of uniform size and shape for the entire pool, except that when found to be necessary for any of the purposes above mentioned, the commission is authorized to divide any pool into zones and establish spacing units for each zone, which units may differ in size and shape from those established in any other zone.

2. The size and shape of spacing units are to be such as will result in the efficient and economical development of the pool as a whole.

3. An order establishing spacing units for a pool must specify the size and shape of each unit and the location of the permitted well thereon in accordance with a reasonably uniform spacing plan. Upon application, if the commission finds that a well drilled at the prescribed location would not produce in paying quantities, that surface conditions would substantially add to the burden or hazard of drilling such well, or that the drilling of such well at a location other than the prescribed location is otherwise necessary either to protect correlative rights, to prevent waste, or to effect greater ultimate recovery of oil and gas, the commission is authorized to enter an order permitting the well to be drilled at a location other than that prescribed by such spacing order; however, the commission shall include in the order suitable provisions to prevent the production from the spacing unit of more than its just and equitable share of the oil and gas in the pool.

4. An order establishing units for a pool must cover all lands determined or believed to be underlaid by such pool, and may be modified by the commission from time to time to include additional areas determined to be underlaid by such pool. When found necessary for the prevention of waste, or to avoid the drilling of unnecessary wells, or to protect correlative rights, an order establishing spacing units in a pool may be modified by the commission to in crease or decrease the size of spacing units in the pool or any zone thereof, or to permit the drilling of additional wells on (I-17) 08/2015 a reasonably uniform plan in the pool, or any zone thereof, or an additional well on any spacing unit thereof.

Source: N.D. Century Code.

Off The Net Later Today -- May 1, 2016

In honor of Bernie Sanders and May Day -- the Day of the International Solidarity of Workers, in the country in which Bernie ... which reminds me ... what is the difference between a sentimentalist and a romanticist. F Scott Fitzgerald struggled over that one:
“I'm not sentimental--I'm as romantic as you are. The idea, you know, is that the sentimental person thinks things will last -- the romantic person has a desperate confidence that they won't.” 
I now get it. I was wondering why young folks were flocking to Bernie Sanders.

Which month as the fewest holidays in the US? May. It doesn't have any. Sure, it has Memorial Day at the end of the month, but you have to wait the entire month so it really doesn't count as a "May" holiday, does it? It's really like the "first day of summer" holiday. And it always falls on a 3-day weekend. Never on a Wednesday which would necessitate taking the whole week off.

School kids are very aware of his: if it weren't for what we used to call "Easter Break" spring would be a bleak holiday season compared to autumn which has Columbus Day, Halloween, The Day of the Dead (actually the "days" of the dead), Thanksgiving, Christmas, Kwanzaa, and New Year's Eve. I may have missed one or two.

So, I get it. The college kids want another spring holiday, and May First would be about perfect, coming just before finals. One last jetting to Corpus Christi or Key West.

I feel the Bern. May First. The Day of (the) International Solidarity of Workers.Venezuela, tic, tic, tic. Cuba, tock.

I don't know if Bernie is a romantic or a sentimentalist but I'm going to take the afternoon off, lie (lay) under the sun,  pull out my copy of To The Finland Station, contemplate what might have been, and, then, ... fall asleep.

I will be off the net for awhile, celebrating May First, enjoying the solidarity, feeling the "bern" of the sun.

Those following the news are aware that there have seen an increasing number of reports of Vladimir Putin harassing US military warplanes and aircraft carriers.

The photo taken below was from my days while assigned to Bitburg Air Base, Germany, back between 1983 and 1986, somewhere over the North Sea. The "BT" F-15 has a tail number with the last two digits "53." That plane "belongs" to the commander of the 53 TFS, 36 TFW, Bitburg Air Base. The photograph was taken by the flight surgeon sitting in the back seat of another F-15 from the same squadron.

The original photograph is on my bedroom wall; the photo below is a photo of the photo. And, no, I don't have the negative. 

Ah, for the good old days.

No, I don't think the fighters are preparing for in-flight refueling.

Thank Goodness This Wasn't Carrying Highly Explosive Bakken Oil -- May 1, 2016

WTOP is reporting:
A CSX freight train has derailed near the Rhode Island Avenue Metro station Sunday morning leaving several cars overturned and a hazardous leak.

Upwards of 10 cars derailed from a train bound for Hamlet, North Carolina, from Cumberland, Maryland, about 6:40 a.m., and emergency responders were working to contain a leak throughout the morning.

“CSX operations and hazardous materials personnel are working with first responders on the derailment this morning in Washington D.C.,” CSX said in a statement released about 8:45 a.m. “The safety of the community, first responders and CSX’s employees is our highest priority.”

The company said one derailed car is leaking sodium hydroxide, used primarily “to produce various household products including paper, soap and detergents.”
I don't think an interruption in soap will shut down Washington, DC, but an interruption in paper production might. Just saying.

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Good News

There is a new Starbucks on my bicycle route between where we live and near historic downtown Grapevine, TX.

It just opened up -- maybe a day or two ago. My wife spotted it. I knew it was going up but did not know the specific location. We drove by it last night. It was obviously closed for the night -- it was about 10:30 p.m. -- but there were people hanging around outside under the big "grand opening" banner proclaiming "Now Open."

My wife said, "See, it's open. The sign says 'now open.'"

And so it goes.

The new Starbucks is right next door to the only In "N" Out burger site in Grapevine.

All That Hype About Greenland Melting Away? Mother Nature Put In A "Restrictor Plate" -- Global Warming Update -- May 1, 2016; Part II Of II Parts

Part 1 is here

Rising CO2, according to the warmists, will do only four things that are "of concern":
  • raise atmospheric CO2 (naturally)
  • raise global temperature 2.0 degrees over the next 100 years
  • raise sea level 2.0 feet along some coasts
  • further acidify the ocean
I can't speak to the fourth issue, but I haven't seen many stories on ocean acidification in the past three years. Like the polar bear, the coral issue seems to have gone away.

For many of us who grew up along the northern tier (of the United States), we have yet to see the downside of our average winter temperature going from forty degrees below zero to 38 degrees below zero. On both the Fahrenheit scale and the Celsius scale, -40 degrees is the same.

Now, with regard to rising sea levels, let's press on.

If local, state, and federal governments AND the insurance industry were concerned about rising sea levels along the coasts, zoning restrictions should be put in place: restrict all new building to account for a receding sea coast, and start to enact new requirements on older real estate along the coasts to prepare for rising sea levels.

The question one has to ask: why is the insurance industry not taking rising sea levels seriously? I can understand why the federal government, and state and local governments are not doing anything along this line (tourism, money, panic) but the insurance industry certainly needs to get ahead of this if the Statue of Liberty is going to be underwater by this time next year.

But here's the nasty little secret. It ain't gonna happen. Rising sea levels require the Arctic ice and the Antarctic ice to melt significantly. The Antarctic accounts for about 75% of that ice; the Arctic about 25%. And the Antarctic is growing.

And it turns out that despite the science being settled, it now turns out that Greenland can't melt as much as the Algroe warmists had warned. Yeah, new science. Unsettled science.

Fox News is reporting:
At least 40 percent of Greenland's ice sheet in the Arctic is protected from melting due to a new phenomenon detected by a group of U.S. scientists, according to a study published in Science Advances magazine.
The study, led by scientists from universities in Chicago, Colorado and Oregon, also had international contributions from France, Denmark and Switzerland.
Despite the rapid thaw in the Arctic, 40 percent of Greenland's ice sheet "rarely experiences surface melting," the report says.
The reason is a process scientists have detected for the first time, by which nature "recycles" water to protect the ice sheets from global warming.
The phenomenon of "recycling," as scientists call it, is based on "sublimated moisture," the process by which meltwater is recondensed into fog particles, "which returns the moisture back to the surface through gravitational settling."
By means of sublimation, the constant humidity of that area is reintegrated into the ice mass, protecting it from losing volume.
This discovery could change the way the scientific community understands two of the greatest environmental concerns - the melting process and the preservation of the Arctic - both by studies of the past and projections of the future.
Some 40 percent of the rising sea level is due to melting Arctic ice, according to data published early this year at the annual Arctic conference at the National Academy of Sciences in the United States, held in Washington.
So, 40% of rising sea level is due to melting Arctic ice. The original model suggested 75% of the rising sea water globally would come from Greenland completely disappearing by sometime next year. Fortunately Mother Nature put in a "restrictor plate" preventing Greenland to go past the 60% mark. So, 40% of 75% of 60% means that instead of New Jersey coast line receding, Donald Trump might actually be able to build casinos a bit farther east of the Atlantic City boardwalk. Maybe those off-shore wind turbines envisioned by Algore and friends will be onshore two centuries from now. 

Unfortunately Fox News does not link the Science Advances story. And it's been a devil of a time to track it down. I might actually have to go to the local library (AKA Barnes and Noble) and read the current issue of Science Advances.

The Marshalltown does report the same story but also doesn't provide a link. So does something called Headlines and Global News. Something tells me Science Advances is a vanity publication funded by the Koch brothers.

The Earth Is Getting Greener, Not Browner -- Thanks To Minimally Increased Atmospheric CO2 -- Scientists -- May 1, 2016 -- Part I Of II Parts On Global Warming Today

Updates

May 5,2 016: this is link for additional material on how increased atmospheric CO2 will lead to "better" crops. Regardless of whether there is anthropogenic global warming, the wrong questions are being asked.

Original Post

Part II is here

Rising CO2, according to the warmists, will do only four things that are "of concern":
  • raise atmospheric CO2 (naturally)
  • raise global temperature 2.0 degrees over the next 100 years
  • raise sea level 2.0 feet along some coasts
  • further acidify the ocean
I can't speak to the fourth issue, but I haven't seen many stories on ocean acidification in the past three years. Like the polar bear, the coral issue seems to have been hyped.

For many of us who grew up along the northern tier (of the United States), we have yet to see the downside of our average winter temperature going from forty degrees below zero to 38 degrees below zero. On both the Fahrenheit scale and the Celsius scale, -40 degrees is the same.

If local, state, and federal governments AND the insurance industry were concerned about rising sea levels along the coasts, zoning restrictions should be put in place: restrict all new building to account for a receding sea coast, and start to enact new requirements on older real estate along the coasts to prepare for rising sea levels.

And now finally, the reason I brought this up.

Back in 1972, I spent a summer in Alaska -- Barrow, Alaska, to be precise -- at a laboratory there, studying the efficiency of Arctic grasses in utilizing CO2. It was understood that Arctic grasses were more efficient at utilizing CO2 than grasses (e.g., corn) in South Dakota.

The lead researcher felt that if one could transfer that efficiency to corn grown in Iowa, the average cornstalk would be one foot higher and produce six ears of corn instead of the average three for the same amount of soil, nitrogen, and water.

A few years ago I received, unexpectedly, a packet from that lead researcher with all my original notes, etc. He would have been about 20 years older than I, so if I was 60, he was about 80. He was probably cleaning out his garage now that it was unlikely he was going to win the Nobel Prize in Science. My hunch is he failed to put together an "Algore" PowerPoint Presentation. He was way ahead of the rest of the pack when it came to CO2 but that came with a downside: he figured it out before Microsoft released PowerPoint. In fact, he figured it out before Bill Gates was born.

But I digress.

I say all that to say this: Hey! Wouldn't it be easier to simply raise the atmospheric CO2 rather than use GMO (which everyone hates and the EU and Kenya are trying to ban) to increase the corn yield in Iowa?

A reader sent this "cut and paste" from CO2 Science:
(Since 1980) the air's CO2 content increased by 16%, while human population grew by 55%. So just how bad is the biosphere suffering in response to these much-feared events? Or, is it even suffering at all?
A new paper by Zhu et al. (2016) provides valuable insight into this important topic.
Noting that global environment change is rapidly altering the dynamics of terrestrial vegetation, Zhu et al. set about to discover just how significant this phenomenon is, as well as what has primarily been responsible for it.
This they did using three long-term satellite-derived leaf area index (LAI) records, together with the output of ten global ecosystem models, which they employed to study four key drivers of LAI trends (atmospheric CO2 enrichment, nitrogen deposition, climate change and land cover change) over the period 1982-2009. And what did this effort reveal?
The 32 researchers -- representing 9 different countries (Australia, China, France, Germany, Japan, Spain, Switzerland, the United States and the United Kingdom) -- report finding "a persistent and widespread increase of growing season integrated LAI (greening) over 25% to 50% of the global vegetated area, whereas less than 4% of the globe shows decreasing LAI (browning)."
And equally importantly, they report that "factorial simulations with multiple global ecosystem models suggest that CO2 fertilization effects explain 70% of the observed greening trend, followed by nitrogen deposition (9%), climate change (8%) and land cover change (4%)."
Could one hope for anything more promising than this? Quite the opposite of what the world's climate alarmists contendshould be happening to Earth's vegetation, rising atmospheric CO2 enrichment is proving to be a tremendous biospheric benefit, overpowering the many real and negative influences that society and nature have inflicted upon it over the past three decades, as shown in the figure below.
By the way, before you get your tighty whities in a twist, that "16% increase in atmospheric CO2" sounds dreadful doesn't it. Sixteen percent. OMG. That's sixteen times more than the GDP growth rate under the Obama administration.

Okay, hold your horses. Let's run the numbers. CO2 make up 400 parts per million in the atmosphere. Put a million atmospheric molecules in your coffee cup, and remove 400 of them. What do you have? A cup that is still full of 999,600 molecules, assuming I did the arithmetic correctly.

Now grab another cup, and put another million molecules in that cup and remove (400 x 1.16 = ) 464 molecules and what do you have? You still have a cup with 999,536 molecules, assuming I did all the steps correctly.

But I digress. Again.

The point of the story is this: the little bit of extra CO2 is not being felt by anyone except the plants and they're lovin' it. 

With this almost negligible rise in atmospheric CO2, the earth is getting greener, and less brown. Another century or two and the Sahara Rain Forest will be a tourist destination.

Algore's great-great-great grandchildren will be taking big game hunters to southern Libya on Hawking Airlines using MuskMelon rocket technology.

The Grass Is Always Greener On The Other Side Of The Trump Wall; US Companies Move To Mexico; Mexican Companies Move To The US -- May 1, 2016

This is pretty cool. Just the other day I had a post on top ten reasons why the nation should appreciate North Dakota. Now Don sends me this story from today's MSP StarTribune:
– At Faribault Foods’ cannery here, beans rule. Black, pinto, navy, kidney — if it’s a dried bean, Faribault cans it. And the plant will be churning out a lot more beans as it undertakes a $100 million-plus expansion.
The leap forward stems from the 2014 acquisition of Faribault Foods by La CosteƱa. One of Mexico’s largest canned food companies, La CosteƱa wants to make a bigger mark in the United States, and it’s using Faribault Foods to pave the way
The Faribault plant employs 319 workers and is the sole U.S. canner of refried beans sold under General Mills’ Old El Paso brand. It also makes K.C. Masterpiece beans and several private-label brands for supermarkets.
And then this, buried deep in the article:
Faribault Foods is in the middle of America’s bean pot as far supply goes. North Dakota is the country’s biggest dried bean producer, and Minnesota is third (with Michigan in between), according to the U.S. Department of Agriculture.
“The Red River Valley is the dominant place for dried beans,” Kindseth said.
Wow, it must be hard for the MSPST editors to let that go unedited. Suffice it to say if Minnesota were #1, that would have been the lede. Whatever. 

But again, this supports a recurring theme in the blog. Geographically, the Bakken accounts for a very small footprint in North Dakota. 

From Boom To Bust. Light At The End Of The Tunnel? Whiting Talks $50 Oil -- Sunday, May 1, 2016

From KARE 11, Minneapolis/St Paul: from boom to bust, big changes in Boomtown. Includes a very nice video; I watched the video without the sound, so I can't comment on the story accompanying the video. The best line in the print story:
"We're glad that we're kind of getting our town back," said Williston Mayor Howard Klug.
Klug speaks for Williston natives relieved the chaos of the boom has passed.
He also points to what the city reaped from the boom: a $77 million rec center and $57 million high school set to open this fall. Both are marks of a prospering community.
But really, how bad is it? Williston's sales tax debt took a six-noth downgrade to junk. Bondbuyer.com is reporting. If unable to reach that site, Moody's also provides updates. From March 21, 2016:
Moody's Investors Service has downgraded to Ba3 from Baa2 the rating on Williston, ND's $1.4 million of Moody's-rated sales tax revenue debt. The outlook is negative.
The downgrade to Ba3 reflects the city's weakened credit quality and recent declines in maximum annual debt service coverage resulting from severe declines in sales tax receipts. The rating also incorporates a modestly-sized tax base with economic concentration in the oil industry, annual risk of non-appropriation, and satisfactory legal protections.
And two days ago, Oil and Gas Investor:
Williston, N.D., epicenter of the U.S. fracking boom earlier this decade, had the credit rating on four of its sales tax revenue bonds lowered six notches by Standard & Poor's (S&P) on April 28 amid lower regional production.
"The downgrade reflects our view of the precipitous decline in sales and use tax receipts that the city has reported since oil production peaked in the region in late 2014," said Scott Nees, a credit analyst with S&P.
Argusmedia.com is reporting that Whiting will start "bringing wells online once oil prices touch $50/bbl and stay there for 90 days."
The independent yesterday raised its output guidance on the back of an agreement it signed with an undisclosed private party to share drilling and completion costs.
Volcker said there are more opportunities to sign similar joint venture agreements across its other acreage but a call on how to develop those resources will depend on where oil prices are.
"We will evaluate as oil prices rise whether we want to drill those or whether we want to JV them," he said.
Under the agreement signed on 14 April, the party will pay 65pc of drilling and completion costs for a 50pc working interest in 44 gross Williston basin wells in North Dakota.
Whiting raised its output guidance for the year to 131,400-136,900 b/d of oil equivalent (boe/d), without raising its capital expenditures (capex). Back in February when the producer announced a steep cut of 80pc in its 2016 capex from a year earlier to $500mn, it had reduced its output guidance for the year to 128,000-138,000 boe/d. That compared with an output of 163,200 boe/d in 2015.