On A Day When The Market Was Down A Bit, CVX Rose To A New 52-Week High

I'm not exactly sure why CVX rose to a 52-week high today when the rest of the market was generally down but it is interesting to note that CVX won a huge case against the US government's Department of Energy.

Bloomberg is reporting:

Chevron Corp. is entitled to unspecified damages against the federal government in a contract dispute over oil deposits in California worth $37 billion, the U.S. Court of Claims ruled.

The Department of Energy “repeatedly and materially violated” two agreements governing determination of equity interests in oil and gas deposits located in the Elk Hills Reserve of California, Judge Susan Braden in Washington wrote in a 90-page ruling.

Chevron “is entitled to be compensated for damages, in an amount to be determined, including sanctions for DOE and the government’s ‘bad faith’ conduct and abusive discovery tactics,” Braden wrote in the ruling made public yesterday. 

But that's not the only thing remarkable about this story.

Go to the link.

This should get your attention:

Occidental Petroleum bought the government’s stake in Elk Hills, one of the largest remaining oil fields outside Alaska, for $3.65 billion in 1997. That’s about $3.65 for each barrel of oil-equivalent it contains. Chevron and Occidental are not operating the oil and gas field together. 

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A Note To The Granddaughters

I have hit a wall. It is impossible to keep up with the Bakken. I was overwhelmed by the daily activity report today: 22 new permits and huge wells being reported by Burlington Resources. And everything suggests we are not even out of the first inning. Last year, in late 2012, I thought we were further along in the Bakken, but clearly we are not. Even without the doubling of the Bakken/Three Forks based on the USGS 2013 survey, what we are seeing in the Williston Basin suggests this is so much bigger than we thought, even in 2012.

I was recently sent a huge slide presentation from the Williston Economic Development office presented in Las Vegas on April 17, 2013. The slide presentation is overwhelming.  One photo in the slide presentation from Vern Whitten photography:

I may  have seen this photograph before; I can't recall. But it really is amazing. 

The Bakken activity is simply impossible to keep up with. It appears that whatever folks think about the Bakken, they are underestimating how big it is going to be. At one time 24,000 wells seemed to be an exaggeration. Then Harold Hamm suggested 48,000 wells. The "word on the street" is that the new number is 80,000 and some say that number is conservative. There is a number that is being bandied about that is so high, I will not post it here. For time/date purposes, I will bury it deep in the blog where it is unlikely to be found, but will be interesting to look back on in the year 2040 when I am long gone.

This is the photograph that probably pushed me to the wall. I simply cannot keep up. This is a Vern Whitten photograph of the activity in the Bakken. It is just one of several incredible, indescribable photographs of Bakken activity.

Or I may just be hungry.