Friday, December 11, 2020

No New Permits But Seven Permits Renewed And One Permit Reinstated -- December 11, 2020

Active rigs:

$46.57
12/11/202012/11/201912/11/201812/11/201712/11/2016
Active Rigs1553655240

No new permits.

One permit reinstated:

  • 37973, MRO, Edyth USA 41-4H, McGregory Buttes, Dunn County

Seven permits renewed:

  • EOG (6): five Round Prairie permits in NWNW/NENE section 15-154-103; Williams County;
  • Bruin: one Fort Berthold permit in SESE section 9-148-94, Dunn County

TSLA Will Replace AIV On The S&P 500 -- December 11, 2020

 TSLA will replace AIV on December 21, 2020, on the S&P 500.

The Largest Removal Of A Dam System In US History -- December 11, 2020

Consider the source: link here

First, background to the Klamath River hydroelectric project. From wiki:

The Klamath River Hydroelectric Project is a series of hydroelectric dams and other facilities on the mainstem of the Klamath River, in a watershed on both sides of the California/Oregon border. 
The infrastructure was constructed between 1903 and 1962, the first elements engineered and built by the California Oregon Power Company ("Copco"). 
That company merged into Pacific Power and Light in 1961, and is now the energy company PacifiCorp. 
PacifiCorp continues to operate the project for profit, producing a maximum of 169 MW from seven generating stations
The company owns all but one of the dams. 
As of 2016, four of the project's dams are scheduled for removal by the year 2020, pending approval by the governing Federal Energy Regulatory Commission. 
A fifth is running at reduced output, facing eventual decommissioning. 
The project can be distinguished from the Klamath Project which is a set of United States Bureau of Reclamation (USBR) dams on upstream tributaries of the Klamath, operated primarily for agricultural water storage. The Link River Dam belongs to both. 

Now, the most recent update, from NPR, the dismantling of the project. 

After I got past the headline, this is yet another example of a huge headline for a small story. 

I may get back to this, if I have the time, but it's important to read the entire NPR story closely. 

Did I read that correctly? 169 MW?

The ten largest wind farms in the world:

  • Jiuquan wind Power Base, China: 20,000 MW (20 GW)
  • Jaisalmer Wind Park, India: 1,600 MW
  • Alta Wind Energy Centre, US, Kern County, CA: 1,548 MW
  • Muppandal Wind Farm, India: 1,500 MW
  • Shepherds Flat Wind Farm, US, Arlington, East Oregon: 845 MW
  • Roscoe Wind Farm, US, Abilene, TX: 782 MW
  • Horse Hollow Wind Energy Centre, Texas, Taylor/Nolan counties, TX: 736 MW
  • Capricorn Ridge Wind Farm, TX, Sterling/Coke counties: 663 MW
  • Walney Extension Offshore Wind Farm, UK: 659 MW
  • London Array Offshore Wind Farm, UK: 630 MW

Now, back to that northern California system of dams: 169 MW. Yawn.

No wonder PacifiCorp went along with the plan: shoot, a wind farm with all the tax breaks will more than make up for this decommissioning project. And, oh, by the way, these were very, very old dams. Any one of them "failing" would have devastated the company and the folks living downstream. 

More background, link here.

The nonprofit organization working to tear down four hydroelectric dams on the lower Klamath River in southern Oregon and northern California has provided its latest cost estimate for the project to federal energy regulators.

In a filing to the Federal Energy Regulatory Commission on Feb. 28, the Klamath River Renewal Corp. estimates full dam removal will cost $446 million — within the project’s $450 million budget.

KRRC formed in 2016 as part of the amended Klamath Hydroelectric Settlement Agreement to carry out removal of the J.C. Boyle, Copco 1, Copco 2 and Iron Gate dams, opening about 400 miles of upstream habit for threatened coho salmon and steelhead. But first, FERC must approve transfer of the dams’ operating license from PacifiCorp to the KRRC, which submitted its 2,300-page “Definite Plan” for razing the four dams in 2018.

Klamath River, from wiki:

Despite its plentiful flow in California, the Klamath does not supply significant amounts of water to irrigators and municipal users in central and southern portions of the state
The Klamath Reclamation Project in the Klamath Falls area supplies water to local irrigators, and the Central Valley Project diverts water from the Trinity River to supply irrigation water to the Sacramento Valley. 
Other tributaries of the Klamath, including the Lost and Shasta rivers, are also diverted for irrigation. Water use of the lower Klamath—one of the last relatively free-flowing rivers in the state of California—has been debated for decades among conservationists, tribes, irrigators, and government agencies, and its eventual fate is still unclear.

This has literally no material effect on electricity generation in the state of California. Except for local irrigators, it appears it will have no material effect on California agriculture. This is not a huge deal for Warren Buffett / PacifCorp one way or the other. In fact, it is one less ankle-biter Warren Buffett has to address.  Something tells me the "recreational" use of the are will change dramatically. Should the state or the Federal government turn the area under the dammed lakes into a national or state park? Why not?

Notes From All Over -- The Mid-Day Market Edition -- December 11, 2020

WOW! WOW! Just announcing! Oracle moving headquarters from California to AUSTIN, TX.  Re-locations are tracked here.

WOW! DIS up 14% today. Up $22/share today. They announced they will increase their monthly subscription fee by $1. Doesn't sound like much for the average user, but $1/$7 = a .... well ... isn't this coincidental = the subscription price increased by 14% -- share price appreciates by 14%. I wonder if CNBC or Jim Cramer has noted this. My hunch? Jim Cramer will talk about DIS later this afternoon.

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

This has been an incredible week. Who would have thought the Dow would have turned positive today, Friday, going into a weekend when anything can happen? The tea leaves suggest the market wants to go higher. DASH and ABNB held their levels, one dropping back a little (insignificant) and the other actually gaining a bit (insignificant). A few new billionaires created. 

Trading vs investing. I'm not a trader so I do not participate in any IPOs. I'm pretty much old school. I hate dividends because of the tax consequences. I love dividends for all the obvious reasons. My pet peeve (one of many): folks complaining that Berkshire Hathaway/Warren Buffett does not pay dividends.

Investing notes on the blog. I mostly post investing notes on the blog while I'm waiting for Bakken news. It also keeps me from getting bored; provides another perspective when I come back to these notes months/years from now. Mostly, it keeps me engaged with what's going on in the world. There is really nothing here for readers. This is simply for my own benefit to keep me interested in the Bakken on "slow" days. 

Biggest disappointment: Starbucks says the company will raise minimum wage to $15/hour --- but the company will do it over three years. With Starbucks hitting all-time highs, I would argue that Starbucks needs to do it now. Doesn't Walmart have a minimum $15 wage? I've lost that bubble. One way they could do this, is base the local wage on local conditions. For example, $15/hour in San Francisco comes nowhere near what $15/hour in Pierre, SD, can buy. Just saying. 

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Huge Pharmaceutical Facility
In West Virginia To Shut Down

This is a huge (unfortunate) story for Morgantown, WV: a huge pharmaceutical manufacturing lab will shut down next summer, costing 1,500 jobs. Link here.   

I completely missed this, back on May 30, 2019:

 
This is a very, very interesting (and unfortunate) story on so many levels.

Retirement Accounts

RMDs: I've been following this story for quite some time. It's been a long time since it's hit mainstream media. Tea leaves: relief will be passed early next year. Hunch: Congress getting a lot of letters and phone calls from angry constituents. I can argue the issue from both sides. Link here
The SECURE Act, which was signed into law last December, included a provision that pushed up the age for mandatory retirement plan distributions from 70 to 72. 
Now, lawmakers are hoping to pass another retirement bill that’s being informally called SECURE Act 2.0 by early next year. A provision in the bill would push distributions up even further, to age 75. 
And don’t look for Congress to stop there. “My goal is to get rid of it completely,” House Ways and Means Ranking Member Kevin Brady (R., Texas). 
He said the pending legislation, which he helped author, takes “another step forward in increasing that age to 75 and exempting those more modest accounts of $100,000 or less.”

CARES Act 2020: check out the "act" for yourself or with your financial advisor, but it appears that ALL RMDs are waived for 2020. One link here.  

Inherited IRAs: non-spousal inherited IRAs must be depleted within ten years. I believe this applies to both traditional IRAs and Roth IRAs.


Friday, December 11, 2020

First things first: I can't say for sure but it appeared a small flock of about a dozen Mississippi Kites were flying south, spotted over Grapevine, TX, when I went out to check the weather: light rain; overcast; dreary; not as cold as I expected. 

Breaking: PFE announces an increase in its dividend. From 38 cents to 39 cents quarterly; currently pays about 3.6%. New dividend with record date of 1/29/21, payable 3/5/21.

Breaking: Aramco selling stakes in subsidiaries to raise cash. Link here. Anonymous Bloomberg sources being reported by Julianne Geiger. Looking to sell stakes in Aramco's pipelines for the purpose of raising $10 billion.

Wow, it's already Friday. These weeks certainly seem to go by quickly. 

Periodic table of oil: third edition adds benchmarks, refinery data. Will post at "data links" page. Bakken crude oil is in third column, third row.

Bleeding cash: top US shale gas basin -- the Appalachian -- continues to bleed cash.  Link here

South Dakota attorney general hit-and-run, update. We might see "decision on charges" before Christmas. Not holding my breath. Tea leaves: no criminal case; will become civil case, "wrongful death."

Apple: Apple is developing in-house modem that will eventually replace Qualcom chips. Time to sell Qualcom? Hard to talk about stock price of QCOM right now with huge swings in market over past few days. Hopefully we will see clarity after Christmas. Look for a lot of QCOM selling in 2021.

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

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Market Opening

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

Random:

  • DIS: up 8%; up $12/share; new all-time high at $167. 
  • ENB: down 1.3% 
  • EPD: up slightly but essentially flat;  
  • OXY-WT: $842 
  • TSLA: second consecutive day with downgrade; down 1.7% in early trading: 
  • ABNB: holding its gains; up 2.6% today; 
  • DASH: profit-taking; down 4% in early trading 
  • WTI: flat at $46.74;

Oasis Will Report Two Bobby Wells Today -- December 11, 2020

 Active rigs:

$46.69
12/11/202012/11/201912/11/201812/11/201712/11/2016
Active Rigs1553655240

Two wells coming off confidential list -- Friday, December 11, 2020: 14 for the month; 70 for the quarter, 735 for the year

  • 35593, SI/A, Oasis, Bobby 5502 42-11 2BX, Squires, t--; cum 51K 9/20; frackedd 2/15/20 - 2/23/20; 11.6 million gallons of water; 95.1% water by mass;
  • 35592, SI/A, Oasis, Bobby 5502 42-11 3B, Squires, t--; cum 47K 9/20; fracked 2/7/20 - 2/15/20 and a second time, 2/15/20 - 2/23/20; 8.5 million gallons of water; 93.6% water by mass; 8.5 million gallons of water; 93.6% water by mass; 

Note: completion strategies are tracked here. At that site, note that Oasis is fracking with large volumes of water; large percentage of water by mass.

RBN Energy: Keyera / Energy Transfer Canada JV recommits to construction of KAPS pipeline

The energy world has been turned upside down in 2020 by COVID-19, resulting in the cancellation, scaling back, or deferral of numerous pipeline projects in both the U.S. and Canada. One such deferral involved a planned NGL pipeline that would run through the heart of Alberta’s Montney and Duvernay plays. Originally slated to begin construction earlier this year, a one-year deferral was announced back in May by the joint venture of Canadian midstream players Keyera and Energy Transfer Canada, the latter of which is itself a JV of Energy Transfer and KKR. Since then, a stabilization in energy markets and signs of recovery in Alberta NGL production has provided the co-developers with the confidence to commit to a construction start in 2021. Today, we review the project and what has changed to get it back on track.

Up until the early months of 2020, Alberta had been experiencing strong growth in its production of NGLs such as propane, normal butane, pentanes-plus (natural gasoline), and condensate (field condensate). Powered by drilling that focused on liquids-rich gas in unconventional plays like the celebrated Montney and Duvernay, this growing supply of NGLs was quickly being lapped up by homegrown industries such as the oil sands (where shippers use condensate and pentanes-plus as diluent) or rising exports of LPG (propane and butane).

That all came to a screeching halt when the pandemic unsettled global energy markets earlier this year and helped to crater energy prices and demand. Alberta was not immune to COVID’s disruptive effects — there was a sharp pullback in pretty much all forms of energy production there, as well as a slowdown of drilling for NGL-rich gas. However, it was not just production and drilling that were affected, but related infrastructure projects meant to capitalize on transporting growing supplies, such as NGLs, that ended up being deferred or scaled back.