Thursday Morning Links -- CLR Putting Oil in Storage; Crude-by-Rail 40%; XOM Earnings Surprise; NYT in Williston; ATT On a Tear

See disclaimer and welcome: this is not an investment blog; make no investment decisions on what you read at this blog. 

Continental Resources (CLR) posts 2Q12 production results: production up 76% yoy, and 11% over 1Q12.

From Yahoo InPlay:

Continental Resources reported 76% production increase YoY in Q2 of 2012: Co announced that expects to report record total production of 94,852 barrels of oil equivalent per day (boepd) for the second quarter ended June 30, 2012, a 76 percent increase over production of 53,984 boepd for the second quarter of 2011.

During the quarter, production exceeded sales by 147,000 barrels of oil as a result of the Company placing oil in storage in anticipation of higher prices. The Company expects to report an average realized oil price of $80.56 per barrel and an average realized natural gas price of $3.51 per Mcf for the second quarter of 2012, yielding an average realized price of $61.69 per Boe (barrels of oil equivalent). 

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At Independent Stock Analysis, this one caught my eye, but there are several others:

“North Dakota Department of Mineral Resources director Lynn Helms says as much as 40 percent of the state’s oil exports are being shipped by train” at Fuel Fix.  

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With recent comments from "anon 1" about the Eagle Ford, this should be interesting from RBN Energy:  The Eagle Ford Crude Story, Part II.

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For investors only, from Yahoo In-Play: 

Exxon Mobil clarification: Large Q2 earnings beat included special items: Earlier we reported Q2 EPS of $3.41 (net income of $15.91 bln) beat the $1.96 consensus, however that included a $7.5 bln net gain associated with divestments and tax related items. Backing out that $7.5 bln gain, Q2 EPS was closer to ~$1.80, below consensus. Our original earning comment has been edited.

XOM popped to ~$87 on the headline "beat" but subsequently sold off the the $84 level after the release was parsed. The stock is currently just below the $85 level (-0.3%) in the premarket.

Comment: one has to chuckle. Too hard to explain.

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Will it ever end? I thought the EPA testing at Dimock, Pennsylvania, was complete. Hardly. It is being reported that the EPA has concluded ALL water testing at Dimock. The story does not explicity say (although I read through it quickly and could have missed it) that this testing had nothing to do with fracking. This time it had to do with non-fracking chemicals:

Overall during the sampling in Dimock, EPA found hazardous substances, specifically arsenic, barium or manganese, all of which are also naturally occurring substances, in well water at five homes at levels that could present a health concern. In all cases the residents have now or will have their own treatment systems that can reduce concentrations of those hazardous substances to acceptable levels at the tap. EPA has provided the residents with all of their sampling results and has no further plans to conduct additional drinking water sampling in Dimock.  

No further plans to conduct additional drinking water sampling in Dimock. I guess even the EPA gets tired of some of this craziness.  I assume the EPA has moved on to North Dakota.

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The New York Times went to Williston and this is all they could find on the downside due to the boom: traffic, housing challenges, and dust. That was it. Traffic, housing challenges, and dust. What they did not find: terrorists; roadside bombs; civil war with threat of chemical agents; starvation; empty shelves; lack of water, sewer, electricity; joblessness; gouging at the grocery stores; problems with fracking; oil spills; derailments; lack of shelter. All they found was traffic, housing challenges, and dust. My hunch is the journalist never really went to Williston; she posted her story from Ohio. Had she actually been in Williston, she would have mentioned mosquitoes.

[NY Times reported a loss...again.
The net loss was $88.1 million, or 60 cents a share, compared with a net loss of $119.7 million, or 79 cents a share, in the period a year earlier, when the company wrote down the value of its regional newspapers, which it later sold.]

By the way, speaking of traffic: I haven't been in NYC recently, but my hunch is that traffic in NYC is much, much worse than anything in Williston. When in Williston I only have two rules: a) avoid left hand turns at all costs; and, b) if in a left hand turn lane, stop as far back as possible to allow trucks to make that challenging left turn. Of course traffic is worse in Williston than it once was: hello!

Oh, and this. The Bakken boom began in Montana in 2000; in North Dakota in 2007. The Bakken boom may be the biggest energy story of the decade (2000 - 2010), and it took five years, or 12 years, depending on where you want to start, for the NY Times to travel that far west of the Hudson. Incredible. 

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Actions have consequences. By killing Keystone XL 1.0, the President has made it easier for the Chinese to get another foot in North America's energy-resource door. Great article/link at the WSJ sent to me by a reader. Thank you.

President Obama may not want to exploit the energy buried in Canada's Alberta oil sands, but China sure does. Think of Monday's $15.1 billion offer by China's state-owned Cnooc to buy Canadian energy giant Nexen as a post-Keystone XL Pipeline bid to replace the U.S. as Canada's biggest energy investor and market.

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For investors only, at Forbes, ATT on a tear:

Data continued to be AT&T’s primary growth driver, with revenues from wireless data and U-Verse broadband and video services growing respectively by 19% and 38% over the year-ago quarter. More importantly, however, the carrier saw discipline in meting out handset subsidies and operational efficiency return to its ranks as wireless EBITDA margins came in at 45% and operating margins at a best-ever 30.3%.

On the subscriber additions front, AT&T was able to add 320,000 postpaid connections during the quarter, a sequential increase of more than 70% as the new iPad bolstered net additions despite a saturated wireless market. Increasing competition from rivals Verizon and Sprint in an increasingly saturated wireless market is gradually causing subscriber growth to slow, and the availability (or not) of LTE in certain markets could be key to attracting new subscribers as well as retaining old ones from hereon.

I have used Sprint forever, and am still a Sprint customer, but ATT has nothing to fear from Sprint.  ATT is up a staggering $1.00 today, a new 52-week high (one of many this year) and still pays over 5%. Compare that to US Treasury bonds.

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Meanwhile, for those interested in US-owned companies, GM hits a new low.

General Motors Co. stock fell 1.2 percent Wednesday, closing at $18.80, down $0.22, on worries about Europe — the first time the Detroit automaker's stock has closed below $19 a share since its initial public offering.

The Detroit automaker has seen its share price tumble by more than 52 percent since it reached a high closing price in January 2011 of $38.90, just after going public in November 2010. The company has shed more than $30 billion in market capitalization over the last 18 months, and now is worth about $29 billion.

And GM is still $42 billion in the hole; President Obama says otherwise. 

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WOW! What is the capital of Israel? I thought it was Tel Aviv, but I guess it's much more complicated.