$4/Month For An iPhone: Investors Disappointed; They Think It Is Still Too Expensive

I can't make this stuff up.

Apple unveiled its new and much-leaked iPhone 5C, a plastic-encased phone in five bright colors with technology not quite up to the leading edge. But instead of pricing the 5C at the bottom of Apple’s current lineup, replacing the $450 iPhone 4, or going even lower, Cook went decidedly mid-tier. The 5C will start at $549 without a contract, or $99 with a two-year deal. That matches the current mid-range iPhone 4S pricing.

Yes, I know it's $549 without a contract, but with a two-year contract, it's $99. And obviously, one has to have a relationship with some provider if one is going to use a phone. $99/24 months = $4.15.

If folks can't afford one of the best phones on the market for $4.00/month, I don't see how they can afford the monthly data plan, no matter how good the deal is. Investors upset with a $99 iPhone? I can't make this stuff up.

Eleven (11) New Permits -- The Williston Basin, North Dakota, USA;

Active rigs: 184

Eleven (11) new permits --

• Operators: KOG (4), HRC (4), Fidelity, CLR, BR
• Fields: Otter (Williams), Dutch Henry Butte (Stark), Charlson (McKenzie), Indian Hill (McKenzie), Stockyard Creek (Williams)
• Comments: KOG has four more permits in the Stockyard Creek oil field. This little oil field east of Williston is simply amazing.

Wells coming off the confidential list were posted earlier; see sidebar at the right.

Wells coming off the confidential list Wednesday:

• 23031, 178, Whiting, Kubas 14-8PH, North Creek, t4/13; cum 9K 7/13;
• 23032, 294, Whiting, Mann 11-18PH, North Creek, t3/13; cum 19K 7/13;
• 23362, drl, CLR, Atlanta 11-6H, Baker, no production data;
• 23948, 2,454, KOG, Charging Eagle 15-21-16-3H3, Twin Buttes; t7/13; cum 24K 7/13;
• 24036, 560, CLR, Hartford 3-19H, Dollar Joe, t8/13; cum 2K 7/13;
• 24701, 712, Samson Resources, Baja 2215-3H, Ambrose, t6/13; cum 25K 7/13;
• 24805, drl, CLR, Wahpeton 13-16H, Banks; no production data;
• 24948, drl, QEP, Patsy 1-29-32BH, Grail, no production data

I Honestly Have No Idea Why He Is Addressing The Nation Tonight

No one can say it better than Peggy Noonan.

A serious foreign-policy intellectual said recently that Putin’s problem is that he’s a Russian leader in search of a Nixon, a U.S. president he can really negotiate with, a stone player who can talk grand strategy and the needs of his nation, someone with whom he can thrash it through and work it out. Instead he has Obama, a self-besotted charismatic who can’t tell the difference between showbiz and strategy, and who enjoys unburdening himself of moral insights to his peers.

By the way, as regular readers know, from the beginning I have called the Syrian Missile Crisis the current president's "Cuban Missile Crisis." From Peggy Noonan:

It is that Syria was not a self-made mess, an example of historic incompetence. It was Obama’s Cuban Missile Crisis—high-stakes, eyeball-to-eyeball, with weapons of mass destruction and an implacable foe. The steady waiting it out, the inner anguish, the idea that crosses the Telex that seems to soften the situation. A cool, calibrated, chancy decision to go with the idea, to make a measured diplomatic concession. In the end it got us through the crisis.

Really, they’re going to say this. And only in part because this White House is full of people who know nothing—really nothing—about history. They’ve only seen movies.
The only question is who plays Bobby. Get ready for a leak war between Kerry’s staff and Hillary Clinton’s.

The nod goes to Kerry. He was in the office, not Hillary; she has retired. 

Top UBS Energy Picks: CLR, EOG, Anadarko, And Noble Energy

No links; easy to find if interested.

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read at this blog or what you think you may have read. This site is for entertainment and education only with regard to the Bakken. With regard to politics, it is for entertainment only.

Another Feel-Good Story; A Must Read

Even though it's a Jim Cramer story, the numbers are real. At TheStreet:

When will people truly realize how important the domestic oil and gas finds in the U.S. really are? When will there be an understanding that the Eagle Ford, the Niobrara, the Permian and the Bakken shales may have enough oil to make a real dent on imports and change the way we think about which U.S. companies truly have the potential to be major independent companies? When will people recognize the U.S. is a lot closer to energy independence than we think? It drives me crazy how little-noticed the changes really are. Take Monday. Did you know that the California Energy Commission released numbers showing that 743,000 barrels of oil were shipped by rail last quarter to California refineries? That's up from 215,000 barrels last year at this time. I almost fell of my chair when I read a newswire report about it. Most of it came from North Dakota and Colorado. 

And then this:

It's nothing, though, compared with the Bakken field flowing out of North Dakota, which sent 317,000 barrels by rail to California in the first quarter. California's not even the biggest destination for oil from that monster play, which will produce almost a 900,000 barrels a day this year -- up from slightly less than 400,000 two years ago. Independents Whiting Petroleum and Continental Resources  lead the Bakken: Each produced about 65,000 barrels a day in 2012, and I bet those numbers will go up substantially this year.  

And it goes on. He also mentions the once-moribund Permian.

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read at this blog or what you think you may have read. This site is for entertainment and education only with regard to the Bakken. With regard to politics, it is for entertainment only.

Another Great Graphic Showing How Inexpensive Energy Is In The United States

Do you remember my post yesterday asking folks if they knew how "cheap" electricity was in this country? Yes, the post in which  pointed out that TXU is giving their electricity away for free, either on weekends or nights, 10:00 p.m. to 6:00 a.m.

CarpeDiem now has an incredible graphic that shows just how inexpensive our electricity is.

For natural gas:

• US: $3
• Belgium: $10
• UK: $10
• South America: $15
• China: $15
• Japan: $16

Germany is not listed, but I assume it is similar to Belgium, though it will be increasing significantly in Germany as posted earlier.

It's too bad we don't have folks in the White House who are interested in pragmatic, realistic, energy plan.

Montana Completions

The Fairfield SunTimes reports.

Richland County, two Bakken wells:

• Whiting, Christiansen 34-11-1H, 16,547 feet TD; 389 bbls. 
• CLR, Charlie 1-5H, 19,475 feet TD; 283 bbls.

Roosevelt County, two Bakken wells:

• Oasis, B & RT 2958 13-25H, 18,141 feet TD - 20,714 feet TD; three laterals, 1,014 bbls.
• EOG, Highline 3-0508H, 20,328 feet TD; 598 bbls.

CLR's 2014 Operating And Financial Guidance; Share Price Spikes; New High; Solidly Over $100/Share

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here.

Investors must have liked this guidance. CLR spiked $4 / 4% in after-hours trading, hitting a new, going over $100 for the first time and solidly above $100. I.N.C.R.E.D.I.B.L.E. 

Press release:

Continental Resources, Inc. expects to increase total crude oil and natural gas production in a range of 26% to 32% in 2014, based on non-acquisition capital expenditures of $4.05 billion.  Continental expects average daily production in 2014 will be in a range of 170,000 to 180,000 barrels of oil equivalent (Boe) per day, with an exit rate for December 2014 of approximately 200,000 Boe per day.

Total production for 2014 is expected to be 70% crude oil, in line with the Company's mid-year 2013 results and the long-term commitment to tight oil resource plays.
Benefiting from recent reductions in well costs, Continental's 2014 budget reflects 400 net well completions (1,090 gross), with 94% located in the Company's two key operating areas, the Bakken in North Dakota and Montana and the South Central Oklahoma Oil Province (SCOOP). The 2014 well count represents a 22% increase over current budgeted completions of 329 net wells in total for 2013.

Continuing:

"Achieving our 2014 goals will be an excellent 'Year 2' in our five-year plan to triple production and proved reserves," said Harold G. Hamm, Continental Chairman and Chief Executive Officer. "We remain focused on our industry leadership in oil production growth, low well costs, and capital efficiency. We're on track to achieve our five-year growth plan while funding an increasing percentage of capital expenditures with internally generated cash flow."

Exploration drilling accounts for approximately $500 million of 2014 capital expenditures, a 16% increase over 2013's exploratory drilling budget. Exploration activity will focus primarily on continued density drilling tests in the Bakken, further testing of the lower Three Forks formation in the Bakken, and further appraisal and a density spacing test in SCOOP.

COP Hit A New High Today; TPLM Up 12 Percent

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you read here. 

The subject line was accurate at the time of the post, but obviously prices will change over time.

Battery Life For The New iPhone 5S: Important Consideration For Those Working In The Oil Patch

Battery life:

• 10 hours 3G talk time
• 8 hours 3G browsing
• 250 hours standby
• 10 hours LTE browsing
• 10 hours wi-fi browsing
• 40 hours music playback
• 10 hours video

I doubt there is a phone with better battery life.

The camera is incredible: burst mode - 10 frames per second; slo-mo; panorama (perfect for North Dakota).

Touch ID: fingerprint ID; 360-degree readability; sensor in the home button; not pressed, simply detected; "deeply built into iOS 7"; can make iTune purchases using your finger to authenticate.

I'm waiting to see the price. The new 5C can be had for as little as $99 with a two-year contract.

Here it is: the iPhone 5S can be had for as little as $199 with a two-year contract. 

Oh, by the way, the iPhone 4S, with 8 GB, is FREE. As in free.

And for roughnecks traveling to China, China will get the iPhone at launch. This is the first time that China got an iPhone at launch. Launch: September 20.

NTT DoCoMo will also get the iPhone in Japan for the first time.

MacRumors forum server is down; overloaded with hits. -- 1:15 pm CST, just after Apple presentation ends. 

Another Bakken Payzone? Another Producing Interval? The Lower Bakken Silt

This little note I missed earlier. From Mike Filloon:

Whiting claims there is a new interval below the middle Bakken and above the upper Three Forks. The lower Bakken silt is prospective Whiting's Hidden Bench leasehold. 

At the link, there is a Whiting graphic which shows this additional interval. 

I linked this graphic just the other day from the Whiting presentation, but I missed this interval; it just shows how good Mike Filloon is in noting details.

The Lower Bakken Silt sits between the lower Bakken shale and the Pronghorn Sand in the Hidden Bench prospect and is considerably thicker than the Pronghorn Sand based on the graphic, up to 7 - 10 x thicker based on the graphic. 

See also this link  (at the link, scroll down). 

Prindle On Halcon; Filloon On Oasis; Three Forks Benches; Pad Drilling; Bakken Deals

First, Prindle:

Amid fervent concerns of share dilution, the price of Halcon Resources (NYSE: HK) dropped nearly 30% between August 6th and August 20th. Up ~7% from the recent low, it seems the storm is clearing.

Several key metrics suggest this domestic oil and gas (O&G) exploration and production (E&P) company is currently priced at an attractive valuation. Indeed, the shares are skimming above 52-week share price lows, while tremendous production increases and magnified oil prices all suggest eminent momentum.

In this article I will present a bullish case for Halcon Resources. I will begin with an overview of the company and my investment thesis. Support for the thesis will be given in a comparable company analysis that focuses on several key metrics. Afterwards, Halcon's geographic positioning will be recapped, followed by a brief technical analysis. I will end by discussing potential equity movement catalysts and respond to common variant views.

Go to linked article for full story.

Now, Filloon:

Oasis Petroleum has been a Bakken outperformer in 2013. It continues to reel in costs and beat on the bottom line. Like Triangle Petroleum it has a pressure pumping and midstream business. This has kept costs low. Oasis also continues to improve initial production rates. Like Kodiak  it is a Bakken pure play, and its leasehold is in a unique area that has a much larger value than the Street gives it credit. Its most recent acquisition solidifies Oasis' position west of Nesson. This is important, as the majority of this could be best in play with respect to downspacing. Like Kodiak's Liberty acquisition, this purchase could make or break Oasis' year.

But, wow, there is so much more at the linked article.

For newbies, excellent discussion on a) pad drilling; and, b) the lower benches of the Three Forks. 

Random Update Of Some Bakken Highlights Since June, 2013

Since June, 2013, one can come up with almost $5 billion worth of activity in the Bakken in various deals (some double counting, of course, but it all moves money). And this doesn't include the cost of drilling 12 wells on one pad, about $100 million, I suppose. Some of the highlights since June, 2013:

• June, 2013: KOG announces that it will acquire 42,000 net acreage in the Bakken for $660 million in cash. Analysts say this could make or break the company.

• August 8, 2013: Triangle Petroleum acquires 9,350 acres for $104 million.

• August 27, 2013: Whiting acquires 17,000 net acres from Petro-Hunt, the Bakken, for $260 million.

• September 5, 2013: Oasis acquires 161,000 net acres with production for $1.515 billion.

• September 8, 2013: note on CLR's increased density drilling -- 12 wells on 320 acres (effectively 27-acre spacing)

• September 9, 2013: Enbridge announces public offering of 8 million shares.[September 13, 2013: offering closed; sold 8 million; raised $223 million].  .

• September 9, 2013: Whiting will offer $1.9 billion in senior notes. 

• September 10, 2013: Oasis to offer $600 million in senior notes. (Subsequently increased to $1.0 billion. -- September 10, 2013, press release.)

• September 10, 2013: CLR: 2014 operating and financial guidance. If that link is broken, try this one.

Around The Horn

Oil down to $106. Good for the overall market, economy. This is not a negative for the energy companies.

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here. 

Oops, KOG does it again. KOG hits a new high ($10.85). How many days is this now, hitting new highs?

Oasis down slightly; analysts suggest Oasis will not have to issue additional shares to pay for recent acquisition. Huge.

CVX, COP, XOM: all down slightly.

EOG down a dollar.

CHK and SD both down a bit.

AMZG up two cents in early trading.

TPLM up almost 4%. This is why:

It seems appropriate we open with Triangle Petroleum  as it just reported earnings this morning. The company met revenue expectations and easily beat on the bottom line. The company posted earnings of 19 cents a share besting expectations of 15 cents a share.

Back in June when the shares were selling at $5.40 a share, I postulated that the shares could double within the next two years. This may prove to be too conservative given we are halfway to that prediction already.

In the article I stated the company's oil services subsidiary RockPile Energy Services was an underappreciated growth driver. In the just completed quarter, consolidated revenues at RockPile grew better than 600% Y/Y to $15.8mm.

UNP up another dollar.

I don't follow BNSF (BRK) much any more; BRK follows the market in general.

ENB, EEP both down slightly.

SRE and TransCanada (TRP) both up slightly; in a trading range.

TPLM Reports Earnings

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here.

TPLM up almost 4%. This is why:

It seems appropriate we open with Triangle Petroleum  as it just reported earnings this morning. The company met revenue expectations and easily beat on the bottom line. The company posted earnings of 19 cents a share besting expectations of 15 cents a share.

Back in June when the shares were selling at $5.40 a share, I postulated that the shares could double within the next two years. This may prove to be too conservative given we are halfway to that prediction already.

In the article I stated the company's oil services subsidiary RockPile Energy Services was an underappreciated growth driver. In the just completed quarter, consolidated revenues at RockPile grew better than 600% Y/Y to $15.8mm.

And more:

The company is on track to achieve more than 250% revenue growth this fiscal year and analysts have almost 60% growth pegged for the next fiscal year. Given this, the stock is too cheap at less than 8x forward earnings even after its huge recent run.

Well, Which Is It?

This is the headline: Next Chevrolet Volt can run up to 96 miles on batteries.

This the story:

The next generation of the Chevrolet Volt will be more efficient, longer running in all-electric mode. GM says that the model should be between 80 and 96 km of autonomy that option and can reach even more. The change is part of a strategy to make more attractive the electric Chevrolet. In studies, GM was found that 80% of drivers rotating hybrid on average less than 64 km per day, showing that the potential exists to increase.

I'm confused. Which is it? 96 miles or 96 kilometers?

Big difference.

Remember: headlines are not written by the guy who writes the article.

The story itself, which appears to be a paid advertisement, says the Volt "... can reach even more." Well, if it can, why don't they say "how much more"?

Steve Zachritz On The Oasis Big Buy

Updates

September 11, 2013: a reader sent in a comment but I wasn't sure if he wanted it posted, so I did not post it. He noted that the seller was Zenergy. I forgot to add that "little" detail earlier; a lot was happening that day. Sorry. That reader also noted this: "It is interesting that the date of this deal is listed as April 2013. This has to indicate that Oasis is very involved in current plans for these new properties. At the September ND O&G hearings, "Zenergy" has an application for up to 16 wells on a unit in 153-97 in northern McKenzie County. Oasis also directly referred to two newly acquired Three Forks 2nd and 3rd bench wells, the Patsy and the Omlid. Both of these were drilled by Zenergy." Very interesting. Thank you.

There are three "Patsy" wells in North Dakota, but only was is a Zenergy well:

• 20689, 1,202, Zenergy, Patsy 5-8HTF, Siverston, t11/12; cum 67K 7/13;

The Omlid well must be:

• 20761, 1,202, Zenergy, Omlid 18-19HTF, Elidah, t1/13; cum 46K 7/13;    

September 11, 2013: do you remember that poll asking how big the Zenergy deal would be if there was to be a Zenergy deal? Here was that original post/poll. I believe Zenergy's portion of the deal was 135,000 net acres for around a billion dollars. If folks remember, Zenergy said they were looking for a billion-dollar deal.
 

Original Post

At SeekingAlpha:

Oasis picked up 161,000 net acres in four separate transactions for $1.515 billion. The acreage blocks are largely contiguous with current Oasis positions both East and West of the Nesson Anticline as shown in the map below. Associated production is a combined 9,300 BOEpd (almost all Bakken and Three Forks production) and management noted corporate pro forma production was a "recent" 43,000 BOEpd (which you'll note is a quite a step up from simply adding the acquired volumes onto the 2Q13 average production of 30,000 BOEpd … as expected volumes have been ramping-up as the completed well count soared during the third quarter.)

On the surface this is a $9,400 per acre pickup but after adjusting value for production (using $80,000 per flowing BOE) that metric falls to $4,800 per acre which is not pricey for what will be largely operated positions. Management reiterated it's recent commentary about being very close to free-cash-flow-land and noted that the acquired assets are near that status as well. A handy map (new acreage in light blue.

Excellent, excellent analysis. A huge thanks to Steve Zachritz.

Great news for current investors in Oasis:

Look for Oasis to use cash and revolver firepower to fund the deal in the near term and for them to tap the senior debt markets to term out a portion of the revolver in due course. The revolver was just redetermined higher (from $1.25 B to $1.5 B) and that was done without consideration for the newly acquired reserves. We're not looking for equity issuance to fund any part of this deal. It's not needed and with free cash flow right around the corner we look for debt to EBITDA to peak now and retreat modestly in late 2014. Again, the upward redetermination of their borrowing base was the entirely the result of their organic growth program in 2013 and we'd expect them to term out only a portion of the new debt in a senior debt offering.

That's pretty impressive to be able to do this without issuing more shares. We will see.

The specifics of the deal are located here, including a link to the sale and purchase agreement between Oasis, Zenergy, et al. 

Tuesday Morning News, Views, And Links

Active rigs: 184

RBN Energy: the challenge of transporting the yellow and black waxy crude oil out of the Uinta Basin.

Futures point to an surging open; oil down slightly. 

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have have read here.

An Oasis press release:

Oasis announced today that, subject to market conditions, it intends to offer $600 million in aggregate principal amount of senior unsecured notes due 2022 in a private placement to eligible purchasers. Oasis intends to use the net proceeds of this offering to fund a portion of the purchase price of its recently announced acquisition of oil and gas properties in West Williston. 

Old Farmer's Almanac:

The other jury is in: A second periodical used for everything from predicting the weather to helping people lose weight agrees that this winter’s shaping up to be cold and snowy.

The Dublin, N.H.-based Old Farmer’s Almanac which, at 222, is believed to be the oldest continuously published periodical in North America, is predicting that a drop in solar activity and a change in ocean patterns point to colder-than-average temperatures and higher-than-average snowfall totals.

WSJ Links

I didn't find much of anything of interest to post. Maybe there was some stuff there but maybe I am just getting more particular in what I post/link, but I doubt it. Just not much there today.

This should be fun to read: the bed Obama and Kerry made, an op-ed. 

So much for John Kerry's "global test," circa 2004.

So much for Barack Obama slamming the Bush administration for dismissing "European reservations about the wisdom and necessity of the Iraq war," circa 2007. So much for belittling foreign leaders who side with the administration as "poodles." So much for the U.N. stamp of legitimacy. So much for the "lie/die" rhyme popular with Democrats when they were accusing George W. Bush of fiddling with the WMD intelligence.

Say what you will about the prospect of a U.S. strike on Syria, it has already performed one useful service: exposing the low dishonesty, the partisan opportunism, the intellectual flabbiness, the two-bit histrionics and the dumb hysteria that was the standard Democratic attack on the Bush administration's diplomatic handling of the war in Iraq.

In politics as in life, you lie in the bed you make. The president and his secretary of state are now lying in theirs. So are we.

It looks like a stare-down between Putin and O'Bama, just like the 1962 Cuban Missile Crisis, but in this case the US blinked. Again, the political theater in the states is just that political theater. The scariest thing for me is a US-Russian Mideast showdown. If we get out of this diplomatically, that will be huge.

Kerry provided the opening. Putin jumped on it. And Michelle gave the "knock-out punch," telling her husband, "no." If this ends well, we have our three Nobel Peace Prize winners for 2014.

On another note, a recurring theme on "the million dollar way" blog is the widening gap between the "haves" and the "have-nots." Regardless of the reason for the widening gap, others are noting it also. In another op-ed piece: the weak recovery explains rising inequality, not vice versa.