Monday, April 3, 2017

Incredible Finish! North Carolina Over Gonzaga -- NCAA Basketball Championship, 2017

Car market tumbles in Marchfrom The Washington Post --
  • plummeted
  • third straight monthly decline
  • strong indication that years of sales growth have come to an end
  • "bad numbers" surprise analysts who had expected a small increase
  • auto industry not worried
  • making solid money on SUVs and trucks; consumers loading up on expensive features
  • car sales: down 11%
  • SUVs: up 5%
  • Hyundai: worse decline, down 8%
  • Ford, second worst: down 7.5%
  • Fiat Chrysler: down 5%
  • Toyota: down 2%
  • Honda: decline just under 1%
On the other side:
  • Nissan: up 3%
  • VW: almost 3% gain
  • GM: just under 2%
EV sales for March at this site:
  • Top sellers
    • Tesla Model S, #1
    • Tesla Model X, #2,
    • Chevrolet Volt, #3
  • It drops off from there:
    • ToyotaPrius Prime, #4
    • Nissan Leaf, #5
  • Not playing:
    • Mercedes
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TCM

I do not understand how "they" do it, but TCM is absolutely incredible. Full movies, commercial free.

Peak Oil? For Mexico, Yes -- April 3, 2017

Three comments regarding the linked article sent to me by a reader (thank you, very much):
  • my understanding is that reserves are related to the price of oil; one wonders whether that is true with regard to this article;
  • this is not a new story; a quick google search reveals that this has been an under-reported story for quite some time
  • the "9 years" is an interesting time frame; "9 years" is also the time frame in which Saudi's cash reserves could be depleted if the price of oil doesn't trend significantly higher, significantly sooner than later
So, here are the data points from SRSroccoReport:
  • Mexico's existing oil reserves are dwindling so quickly that the country could "go dry" within nine years without new discoveries
  • Mexico's reserves fell almost 11% in 2016
  • once the world's largest crude oil producer, Mexico's proven reserves have declined every year since 2013
  • the cause: record-low drilling activity for the past 3 years
  • crude production has declined every year since 2004
  • production will fall below 2 million bopd this year, the lowest levels since 1980
Two immediate problems for Mexico (similar to Saudi Arabia but for different reasons): a) less oil being produced on a daily basis; b) price of oil is low, could go lower.

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Deep Water to Challenge Shale

Link here at Oilprice.com.
Shell is boasting future profitability at $15 a barrel from its Mars platform in the Gulf of Mexico. The company is adopting drilling techniques from smaller, independent energy firms, which have left the Gulf after finding themselves unable to withstand the investment pressure, and is also transforming its corporate structure, which has already borne fruit.

"Movie" From A Single Photo -- April 3, 2017

Vern Whitten has sent many, many photos and links to his photos to be posted on the blog. Whenever they get posted, they end up getting "the most hits."

I have a tag at the bottom of the page for Very Whitten if interested in photos he has sent me.

Today he sent me a video with technology I do not understand. His comments:
Here is something rather unique. The 20 second video below was created
using a SINGLE PHOTO:  
The "photo-video" is at this link:  https://youtu.be/0oMvh6xiXn4
In response to a comment, Mr Whitten replied:
I saw a video that [a Bakken operator] did on one of their multi-well pads a couple years ago.
It was done with a helicopter (expensive) and was only fair quality. I think our method of moving still photos will work great. It's much easier to shoot still photos from an airplane than it is to take video.

More Energy Growth In Coastal Texas -- April 3, 2017

I've said this many, many times: some days there is just so much information I cannot keep up. Today was another one of those days.

For now, two links sent to me by another reader.

CenterPoint Energy press release: is requesting endorsement from Texas regulators to begin huge infrastructure project in south / east Texas to support the incredibly fast-growing energy sector. The beginning of the press release:
CenterPoint Energy, Inc.'s electric utility submitted a proposal to the Electric Reliability Council of Texas (ERCOT) requesting its endorsement for CenterPoint to enhance existing, and construct new, electric transmission infrastructure.
This project would meet the unprecedented load growth of the petrochemical industry in the Freeport, Texas area. This growth includes new committed load expected to total approximately 1,340 megawatts, which is planned to go into service at varying stages between 2017 and 2019.
The company expects to have the proposed enhancements complete by summer 2019 and the proposed new line is anticipated to be in service in 2021.
Look how fast "they" plan to move, or perhaps better said, need to move.

Based on an earlier note in the past few days, a "new committed load expected to total approximately 1,340 megawatts" could require anywhere from two to six new natural gas plants.

Also affecting the same area,  FuelFix reports that Cheniere Energy exported its 100th LNG cargo. From the article (which has been previously in this blog, more than once):
Cheniere recently completely and began operating a third LNG liquefaction unit at its Sabine Pass terminal near the Texas-Louisiana border. A fourth unit, called an LNG train, is expected to come online this fall.
In February 2016, Cheniere became the first company to ship LNG from the contiguous United States in more than 50 years. Other companies are developing LNG export projects, but they’re yet to come online.  In just more than a year, Cheniere has delivered cargoes to 18 countries on five continents.
At the Sabine Pass terminal, a fifth train is expected to be finished in 2019, while the sixth doesn’t yet have a timeline. Each train has the capacity to process 4.5 million metric tons of LNG.
Cheniere also is building a Corpus Christi LNG export terminal that’s expected to start operations in 2019. The first two Corpus trains are about 50 percent complete, while a third is the next project the company expects to announce.

CLR's Ransom - Omlid Wells In Elidah Oil Field

I believe this is the first graphic I've posted of this area in the Bakken. This is where I will track the CLR Ransom - Omlid wells. I will not track the BR wells at this post.



April 4, 2017: from a reader regarding the proposed 5-well CLR Omlid/Random pad --
This is a little more background on the Continental Resources Omlid/Ransom wells based on a NDIC hearing last fall.
The 4 Omlid permits issued yesterday are to drill north in sections 19 and 18. The 3 Ransom wells will drill south into sections 30-31.
According to the hearing, Continental plans to drill a similar number of wells in each direction at some later point from a second pad in the north part of section 30.
It is interesting to note, the Omlid wells will be made up of two middle Bakken, one first bench Three Forks and one second bench Three Forks.
The Ransom wells show one middle Bakken, one TF bench one and one TF bench two.
The original Ransom well drilled from south to north in section 30 is a middle Bakken well, drilled in 2011.
The Omlid unit (sections 19-18, 151-97) already has a Three Forks third bench well which has been producing since 2013. It has totaled 184,000 barrels oil and still made more than 2,500 barrels in February 2017. It has to be one of the best, if not the best, third bench well in the central Williston Basin.
This is all the more interesting since most all the recent Three Forks drilling has been held to the first bench by most operators. The only exception is a couple of Oasis wells drilled to the second bench last fall. These wells are 6 miles west of the Omlid/Ransom unit.
For newbies:
I have said on the blog that by late 2014, just when the Saudis announced a surge in production resulting in a huge drop in oil prices, the middle Bakken was pretty well mapped out by the operators.
They were just beginning to complete the process of mapping out the Three Forks.
Meanwhile, the second and third bench still had a long way to go.
So, things continue to move slowly in the lower benches, but gradually we are getting there.
The other interesting thing about the Omlid-Ransom wells, of course: the close proximity BR and CLR are working; I've seen this elsewhere. I understand the process. But it sure begs the question to what degree the two companies are working together and if there could ever be a closer, more "official" relationship.
And one other note: this is the Elidah oil field which is interesting in and of itself.

Investment Article On FANG In The Permian -- Filloon -- April 3, 2017

Line here

Mike Filloon has an investment article on FANG in the Permian. I have no interest in the investment angle, but the article does provide a few interesting data points about a) unconventional oil; and, b) the Permian. Beyond that, I don't have much to add.

Mike does not comment on the interesting "oil type curves." The graphic below is from the linked article. It would have been nice for Filloon to explain the "B" and "C" curves. Were they good wells, but fracked late? Were they re-fracked (unlikely -- too early in the life of the well)?

Hess, BR Each Report One Completed DUC; Still At 50 Active Rigs -- April 3, 2017

Should have the post up later this evening (Monday, April 3, 2017).

Active rigs:

4/3/201704/03/201604/03/201504/03/201404/03/2013
Active Rigs502994190185

Seven new permits:
One permit renewed:
  • SHD, a Maya permit in McLean County
Two producing wells (DUCs) reported at completed:
  • 31999, 2,004, BR, CCU Zephyr 14-34 TFH, Corral Creek, t3/17; cum --
  • 32460, 1,380, Hess, BB-Federal 151-95-1708H-11, Corral Creek, t3/17; cum --

The Market And Energy Page -- T+72, April 3, 2017

The market: futures were up a bit, and I think the market opened up a bit, but now, mid-morning, the Dow 30 is down about 40 points. WTI remains above $50.

Tesla: beats expectations -- delivers record 25,000 vehicles in first quarter. The headline is a bit of hyperbole, I suppose. Forecasts ranged between 23,000 and 24,000 which, to me, in the big scheme of things, Tesla pretty much came in as expected. "Missing" expectations would have been devastating. Tesla missed delivery expectations last quarter so it probably was not that "big a deal" to hit / exceed expectations this time around. But had they missed? Wow. These were Model S (13,450) and Model X (11,550). I always find it interesting how Tesla numbers are always a "very round" number.

For the archives: this is an issue that doesn't really interest me at the moment, but it's important for the archieves -- Oilprice.com on record -- an OPEC deal to extend production cuts won't lift oil prices. I disagree. All things being equal, on the day that OPEC announces an extension of production cuts, the price of oil will rise 2/50 or 4% or more.

The Political Page, T+72 -- April 3, 2017

Fretting over Texas. Yesterday, in the Dallas Morning News, there was a long (very long) op-ed lamenting that Texas was no longer #1 in business or something to that effect. I can't recall what the writer was actually lamenting except to say that the Texas economy was no longer what it used to be. Most of the op-ed seemed to be about the "bathroom issue." I do remember that the writer lamented that the state of New York spent $20,000 per student in K - 12, whereas Texas only spent $7,000 per student. The writer was concerned that Texas students were not receiving the education they needed to succeed in the 21st century or compete with students from New York. But today, Platts is reporting that Texas is indeed #1 in something: gasoline consumption. Archived.
Fretting over Gorsuch. Mitch McConnell is not used to losing but it's not beyond the pale this time.

Fretting over Trump. Bit by bit, Trump methodically undoing Obama policies -- AP.

April 3, 2017

Active rigs:


4/3/201704/03/201604/03/201504/03/201404/03/2013
Active Rigs492994190185

RBN Energy: the growing LPG-export role of the Marcus Hook Marine Terminal, a Sunoco operation in Pennsylvania.