Thursday, September 3, 2020

One Well Coming Off The Confidential List -- Hess -- September 3, 2020

First things first: US Army Corps of Engineers: status report on DAPL -- https://earthjustice.org/sites/default/files/press/2020/3154-USACE-Status-Report-8.31.20.pdf. From a reader:

If you want to read the current correspondence, skip to page 2310.  The first several thousand pages of attachment are Corps' boilerplate manuals.

The correspondence is so very indicative of the parties' positions.  Hasselman just can't help himself - he has to take a swat at the proposed expansion.
Other first things first: Lego sales surge. LOL. Link: https://www.foxbusiness.com/markets/lego-sales-surge-coronavirus. 
 
 
Other first things first: PGA FedEx Championship begins today. Expect two things:
  • lots of advertising; NBC desperately needs the revenue;
  • lots of video clips of Tiger Woods: about the only think that will keep "fair-weather fans" tuned in
Right on cue: no sooner than I post the above note on the PGA tournament, and we see an open letter of "thanks" to Tiger Woods from Phil Mickelson on CNBC thanking Tiger for all he's done for the sport  -- reminding all of us, of course, Tiger won't be playing in this tournament. 


DAPL, DAPL, who needs the DAPL? All for DAPL stand up and holler. ET adds takeaway capacity in the Permian. Link here.

Energy Transfer reported Tuesday that it has completed its Lone Star Express Pipeline expansion project on budget and ahead of schedule.

The new 352-mile (566-kilometer), 24-inch-diameter pipeline adds more than 400,000 barrels per day of natural gas liquids (NGL) capacity to the Lone Star NGL pipeline system, Energy Transfer noted in a written statement. The company added the expansion runs from Winkler County, Texas, to the existing Lone Star Express 30-inch pipeline at the Morgan Junction in Bosque County, Texas, south of Fort Worth.

Now we know. WTI fell yesterday despite a huge decline in inventories. '

That didn't make sense ... until one looked at refining runs. Wow. Refiners dropped well below their operating capacity; again, below 80%. Of course, this was somewhat of a one-off, due to the much-hyped Hurricane Laura. But WTI continues to fall. Approaching the $40-support level.

Ouch. OPEC basket drops again, link here: $45.03.

Saudi Foreign Exchange Reserve
: pending.

*************************************
Back to the Bakken

Active rigs:

$40.68
9/3/202009/03/201909/03/201809/03/201709/03/2016
Active Rigs1160635633

One well coming off the confidential list -- Thursday, September 3, 2020:

  • 36002, drl/A, Hess, AN-Mogen Trust-153-94-2932H-5, Antelope-Sanish, t--; cum 85K 7/20;
    PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
    SANISH7-20202112033119443807000
    SANISH6-2020301403114038382726808249081850
    SANISH5-20203119637196357721272611078716427
    SANISH4-20203017539175934986264771627710149
    SANISH3-2020292171621538318345312102613440

RBN Energy: potential recontracting dilemma for gas supply-push pipelines.

The U.S. natural gas pipeline sector is entering a challenging period for recontracting a major chunk of its capacity. The numerous pipeline systems built during the early years of the Shale Era’s midstream boom were anchored by 10-year, firm shipper contracts, mostly with producers, making them so-called “supply-push” pipelines. Many of those initial contract periods have begun to roll off, exposing pipelines to producer-shippers’ renewal decisions based on current fundamentals. Shippers typically expect substantially lower rates for a renewal contract, because much of the pipeline has been paid off through depreciation. 
But there’s another issue that is becoming more important: shipper recontracting may not happen for market reasons. For pipeline owners, this is happening at the worst possible time. The market is in turmoil and facing ongoing uncertainty. Gas production is down, demand from LNG export facilities is in flux, and regional supply-demand dynamics are shifting. As if that weren’t enough, new, large-diameter pipelines out of the Permian now nearing completion will reshuffle gas flows around the country. And other transportation corridors that not long ago were bursting at the seams and feverishly expanding to ease constraints are now at risk of being underutilized. Today, we discuss the factors that together may present significant risk for pipelines approaching the proverbial recontracting “cliff.”

2 comments:

  1. If WTI stays above 39.80 then it beats the last low support, it will potentially springboard from here into a 45 to 49 range if the fundamentals keep improving, time will tell of course. Still not seeing a huge activity in drilling yet, thinking that if they miss the start up there will be spike coming, and everyone is preaching cash discipline now so they will drill, but at safer pace.

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  2. I’ll be surprised if we see sustained $46 by the end of the year.

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