Thursday, December 19, 2013

For Investors Only: ONEOK To Spin Off ONE Gas, Inc; Crude Oil Price Pops

ONEOK announces Kansas Corporation Commission has approved a settlement agreement with the co :
  • Co announced that the Kansas Corporation Commission has approved a settlement agreement that allows ONEOK to separate its natural gas distribution business into a stand-alone publicly traded company, ONE Gas, Inc., and authorizes the transfer of ONEOK's existing Kansas natural gas distribution assets, certificates of convenience and necessity, franchises and tariffs to ONE Gas. 
  • The transaction is expected to close in late January 2014 or early February 2014. 
  • ONE Gas is expected to be listed on the New York Stock Exchange (OGS).
Disclaimer: remember -- 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.

Around noon today: Feb crude oil pops above $99/barrel... Feb crude is now +1.0% at $98.98/barrel. Comment: I have always enjoyed seeing the word "pop" or "pops" in sentences summarizing the price movement of oil.  

PSX traded at a new high today, though profit taking brought it down by the end of the day. 

Seven (7) New Permits -- The Bakken, Williston Basin, North Dakota, USA

Active rigs: 188

Seven (7) new permits --
  • Operators: BR (4), Petro-Hunt (2), Whiting
  • Fields: Johnson Corner (McKenzie), North Tioga (Burke), East Tioga (Burke), Sanish (Mountrail)
  • Comments:
Wells coming off the confidential list have been posted; see sidebar at the right.

Wells coming off the confidential list, Friday:
  • 24987, drl, Statoil, Domaskin 30-31 6H, Alger, no production data, 
  • 25066, drl, XTO, Loomer 21X-4E, Tobacco Garden, no production data,
  • 25455, 1,061, Newfield, Barracuda 150-100-11-2-2H, Sandrocks, t9/13; cum 16K 10/13;
  • 25472, 72, Fram Operating, Schlak 3, Norma, a Madison well, t11/13; cum --

The Saga Continues: The Energy Debacle In New England (New Hampshire, Boston, Et Al)

If this story is new to you, click here to get brought up to speed.

The Union Leader has an update:
Cold weather is straining the New England power grid, as demand for electricity on Tuesday was expected to break the winter record for 2013 set in January.

Peak demand was expected to reach 21,400 megawatts Tuesday night, compared to the previous winter peak for the year of 20,887 on a frigid Jan. 24, according to ISO-NE, the independent system operator.
The all-time winter record was set on Jan. 15, 2004, when peak demand hit 22,818 megawatts.

At one point during the day on Tuesday, ISO-NE asked for a delay in routine maintenance or testing that could affect power generation or transmission on the grid.
On Saturday, grid operators had to implement more drastic measures, using emergency reserves and buying power from the New York ISO for several hours in the late afternoon and early evening, according to ISO-NE spokeswoman Ellen Foley.
Peak use on Saturday hit 20,180 megawatts, lower than Monday and Tuesday, but 630 megawatts more than the ISO-NE forecast for that date, prompting severe conditions in the ISO control room and a temporary spike in electricity prices on the spot market.
Foley speculated that the high demand on Saturday was due at least in part to the pending snowstorm, which kept many people — who would otherwise be out and about — at home using electricity.

The price for one megawatt hour of electricity in the real-time power market hit $1,000 at one point early Saturday evening, compared to a 12-month average of $36 in 2012.
Fortunately for consumers, utilities that provide electricity for residential use purchase long-term contracts for electricity and do not rely on the spot market.
The peak for Tuesday on the spot market was just over $340 per megawatt hour, as of 3 p.m.

Ramblings And Musings: Ready To Flee

Updates Throughout The Day


My wife went to the post office yesterday to buy some stamps. She simply wanted 50 Christmas stamps for her annual holiday updates to friends. 
The clerk asked her "what denomination?" 
You don't know my wife. I stepped back. 
"God help us, has it come to this?" she practically yelled.
Calming down she continued, "Okay. Give me 22 Catholic, 12 Presbyterian, 10 Lutheran, and 6 Baptists."

6:56 a.m. PT: I was going to add a clip from Hunter S Thompaon's Fear and Loathing in Las Vegas but didn't quite fit the mood this early in the morning. Maybe midnight tonight. So, what's the market doing, now that it must be after 9:30 on the East Coast? Oil up slightly. Market flat, down slightly. CVX melting up. 

6:41 a.m. Pacific Time: I was going to buy a new Phillips Blu-Ray DVD player at Target today. Regular readers know that I don't watch television any more (or very, very rarely). I brought a cardboard box full of new Blu-Ray DVDs out to California with me. The Blu-Ray DVD player we have out here, bought this most recent summer, plays Blu-Ray and other DVDs just fine except for "Disc 2" of The Hunger Games (first movie). Don't understand it. I can access "Disc 2" on the Phillips Blu-Ray DVD player at home in Texas, but not on the player here in LA for some reason.

My wife saw Hunger Games for the first time last night; it was the second time I saw it. I saw a lot of things I missed the first time. Our ten-year-old granddaughter has read the read trilogy three times. She knows the story by heart. For my cross-country trip she gave me a card with the inscription: "May the odds be ever in your favor."

The Hunger Games

I thought it was an incredible story line. My wife's one-word review: "interesting."

Because we couldn't see Disc 2 of The Hunger Games, we watched the first two episodes, Season 1, of The Big Bang Theory. Again.
Original Post

Overriding theme for the day: I am ready to get back on the road. Two days in Los Angeles; seen it, done, ready to ride.

California Dreamin', The Mamas and The Papas

This might be my last post for the morning. I will just keep adding to it. Should I put the new stuff on top, or keep adding it to the bottom. I think I will put updates at the top.

I've posted the usual morning updates, including the wells that came off confidential list today.

Things on my mind: unable to log onto my Target Red Card account. Not a good sign for the company. The data breach began November 27th and extended through December 15th. It appears card holders learned this through the media. No e-mail alert sent; at least not yet.

Stock market surges almost 300 points yesterday. My wife and I were on the "405" after an incredibly wonderful day. We spent the day at the Getty Museum off I-405 just a couple of miles north of Wilshire Avenue. This was also the site of all that freeway construction some months (years?) ago. They did an incredible job. This was the first time my wife saw the "new" freeway, and, of course, it was the first time I saw it. If I recall, the biggest change was the removal of the Wilshire overpass over I-405. The view of this change from atop the hill at the Getty Museum was quite extraordinary. The absence of the overpass is visibly striking.

We enjoyed the Getty more than we usually do. Not sure why. It's my wife's favorite museum in southern California, and maybe her favorite fine art museum in the entire US. I tend to agree. I bought two Getty biographies. I will quote from them after Christmas. My wife will wrap them and put them under the tree.

Neither of us thought we would enjoy the current featured exhibit, Canterbury and St Albans: Treasures From Church and Cloister, but it was incredible. We will be going again next week when our Portland, OR, daughter/son-in-law visit us for the holidays. Both have their divinity degrees; they will be overwhelmed by the exhibit. I think. We were stationed in England / East Anglia (home of the warmists) and never realized how much we missed; and we thought we saw "everything" in this part of England when we there for three years, 1986 - 1989, inclusive through the summers.

So, that's how we spent our day yesterday.

New stuff will be added at the top of the post, if the spirit moves me.

Analysts Forecast Decrease To 336,000; Reality: Surge -- Climbed by 10,000 To Almost 380,000 -- Back To Where We Were; One Step Forward, Two Steps Back

Bloomberg is reporting:
Applications for U.S. unemployment benefits unexpectedly rose last week to an almost nine-month high, showing fluctuation in the filings that typically occurs around the year-end holidays.
Jobless claims climbed by 10,000 to 379,000 in the period ended Dec. 14, the most since the end of March, Labor Department data showed today in Washington. The median forecast of 48 economists surveyed by Bloomberg called for a decrease to 336,000. It’s best to focus on the four-week average during the holiday season to determine the underlying trend, a government spokesman said as the figures were released. 
And then this revelation: analysts don't put much stock in year-end numbers:
“Claims at this time of year are very volatile, so we don’t want to put too much stock in each week’s fluctuations,” said Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, and the best claims forecaster over the past two years, according to data compiled by Bloomberg. “Layoffs are low, which is very encouraging.” 

Thursday: $75 Billion Monthly Stimulus To Continue; Congress Passes Budget; Insurers Extend Grace Period; Market Surges Almost 300 Points; Unemployment Claims Surge Due To Holiday Distortions. LOL

Active rigs: 189

RBN Energy: Natural gas conversion challenges in New England.
While most of the country is enjoying the benefits that low cost North American supplies of natural gas bring to local and regional economies, many parts of the Northeast US and Atlantic Canada are still heavily reliant on expensive oil-based products for residential, commercial and industrial use. That is in spite of the proximity of burgeoning supplies of natural gas in the Marcellus and Utica shale basins. The challenge in converting users away from oil lies in infrastructure build out and deciding who will pay. Today we begin a two part series on the slow conversion process and new solutions to supply natural gas to customers before pipeline infrastructure is built.

I'm not in a good mood today. I am unable to connect on-line to my Target account. I will be canceling my Red Card today.

For Investors Only

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

A couple of days ago I said there were three things weighing on investors and how I felt about them. This is what I wrote:
Three things weighing on the market:
  • Federal budget compromise -- not yet a done deal. Just political theater. It will be passed.
  • could the Fed announce tapering this week? Nope.
  • will ObamaCare's disarray have significant effect on the US economy in 2014? Yup.  
Update, today, my thoughts: 
Three things weighing on the market:
  • Federal budget compromise -- it was passed. Sent up to President Obama.
  • could the Fed announce tapering this week? Yes, if one thinks $75 billion (vs $85 billion) monthly is tapering; inconsequential.
  • will ObamaCare's disarray have significant effect on the US economy in 2014? Yup. But insurers slow-roll the administration; agree to pay insurance claims for first ten days of January, 2014, if policy-holders pay first premium by January 10, 2014. I guess the extension is from December 23, 2013, to January 10, 2014.
  • So,what did the market do while I spent the day at the Getty Museum in west Los Angeles yesterday? Up almsot 300 points. Futures today suggests it will hold those gains for the most part and oil will melt up.
Speaking of Obamacare: this story is gaining traction. Federal exchange may be illegal under the law. The law clearly states that only state exchanges can offer health insurance premium subsidies.

Jobless claims: the spin is in high gear.  Bloomberg says unemployment claims surge on year-end / holiday distortions. I guess the highly paid Wall Street analysts forgot a) Christmas comes every year; b) the year ends every December 31. This is quite an incredible story.

New Jersey credit rating lowered. Probably the end of the presidential talk for the governor, a RINO.

The Wall Street Journal

Stimulus will continue. Feds will maintain zero-interest rate through 2015. Market surges almost 300 points.

Target Red Card hit by data breach. Unable to access account. 

The Los Angeles Times

Target Red Card hit by data breach. Unable to access account.  I will stop by customer service this morning.
Unions need to give the public a break.
Even in deep blue California, where Democrats dominate, organized labor is losing public popularity.
That's a general statement, based on nonpartisan polling.
Specifically, public employee unions are tarnishing all labor, according to the pollster.
He pinpoints pension envy: public employees pulling down generous retirement benefits that private sector taxpayers began losing years ago. That's the long-term public gripe.
And recently in the traditional labor stronghold of the San Francisco Bay Area, voters have especially soured on unions because of two very annoying public transit strikes.
It's interesting: huge union story in The LA Times and SEIU is not mentioned. Speaks volumes.

Back to the e-mail and the news. 

Something new in Bakken reporting. I had not see this before. WPX with an annotation in the well file report suggesting that 16 stages in this particular well was equivalent to 31 stages. Really?
  • 24463, 1,592, WPX, Adam Good Bear 15-22HD, Van Hook, 16 stages; 3 million lbs, t6/13, cum 52K 10/13; comment: 16 stages = 31 equivalent stage.
Mark Perry: great graph on US energy revolution, due to shale

From Rigzone: Pennsylvania is the fastest growing natural gas producer due to the Marcellus.

From an MDU press release: MDU increased its earnings guidance for 2013. Adjusted earnings per share for 2013 is now projected in the range of $1.45 to $1.50, an increase from prior guidance of $1.35 to $1.45. GAAP earnings guidance is in the same range.