Saturday, August 8, 2015

Why Bakken Production Remains High Despite Low Crude Oil Prices -- Filloon -- August 8, 2015

Link here. Archived.

For now, I will simply link the article, without comment. I will post excerpts later if the spirit moves me.

I'm more interested in EOG's conference call which I will talk about later.

The Usual Suspects

I vaguely recall watching The Usual Suspects some years ago but until I watched it again this evening, I did not recall any of the movie and certainly did not recall the twist.

For all practical purposes, watching it tonight was the first time I "saw" the movie. I loved it. After watching the movie I looked at a few websites to see what others had thought. I was surprised that Roger Ebert did not like it, giving it 1 1/2 stars. Without question, he was way off the mark.

I'm not sure I would have classified The Usual Suspects as film noir but apparently that's how critics pigeon hole it.

Regardless of what genre it is, I loved it. Some critics/reviewers say that after watching it once, there is no enjoyment watching it a second time. Not true.

I did not realize it until seeing it the second time (immediately following the first showing), it's a Quentin Tarantino movie (except for one thing: Tarantino would have had an incredible soundtrack; The Usual Suspects does not.

Tarantino is noted for a) story telling; b) great dialogue; c) violence; d) an incredibly good ensemble; and, e) the soundtrack.

The Usual Suspects  has all of that (except the soundtrack).

The cast is great. The story telling is so Tarantino.

The flashbacks or the action scenes are very, very good, but what I think most folks miss is the absolutely humorous scenes through the entire movie when Kevin Spacey answers the interrogator's questions -- once you know how Spacey's character is coming up with the story -- ad libbing as he goes along.

Most of the movie takes place and is shot on location in San Pedro, California, and at the Port of Los Angeles, just blocks from where my wife's parents lived and where we still visit every summer and during two or three weeks each winter.

Blu-Ray at Target for $5.00 but on sale today for $4.75.

Another Burr Under My Saddle -- August 8, 2015 -- Intermittent Energy, Nameplate Capacity, And The Capacity Factor


August 14, 2015: capacity factor appears to be all the rage right now; "greenies" tell us future wind farms will reach 65% capacity.
The National Renewable Energy Laboratory (NREL) recently released data showing that the capacity factor (CF) for wind power can reach 65 percent -- comparable to the CF of fossil-fuel-based generation.
While the headlines aren’t as sexy as Tesla’s "Ludicrous mode," the transformative implications for climate change dwarf Elon Musk’s latest accomplishment. Increasing a generator’s CF can increase its value in a variety of ways, including: reduced cost of energy, improved transmission-line utilization, and often, reducing stress on the grid by providing more power at times of peak demand. It will also likely reduce the amount of storage and natural gas needed to manage the grid under scenarios of high renewables penetration. Implicitly, NREL’s new report positions wind to become a dominant and possibly the primary source of electricity in the U.S.
Iowa will lead the way.  
Original Post
There will be nothing new in this post that you haven't already seen somewhere else on the blog. I'm doing this for my own benefit -- please skip this if  you came here looking for the Bakken.

A number of articles on "the unseen costs of intermittent energy" have been published in disparate media outlets over the past few weeks that seem a bit more than simply coincidental. I linked the various articles in various spots on the blog but now I'm going to try to put them in one spot for archival purposes.

I'll begin with this "cut and paste" from one of my posts:
Personally I have learned a lot about energy by following the intermittent energy story. Prior to the blog, I did not understand "nameplate capacity" and, now, all of a sudden there's another "old" concept that is getting a lot of attention: "capacity factor" which is very closely related to "nameplate capacity."They may be synonyms. I recently posted a story from The Lead for the archives and now it turns out that Forbes has a long article on the very same subject: "The Clean Power Bill Will Collide With The Incredibly Weird Physics Of The Electric Grid." Coincidence?
According to wiki:  Nameplate capacity, also known as the rated capacity, nominal capacity, installed capacity, or maximum effect, is the intended full-load sustained output of a facility such as a power plant,a chemical plant, fuel plant,metal refinery,mine,and many others. Nameplate capacity is the number registered with authorities for classifying the power output of a power station usually expressed in megawatts (MW).

The other day a reader sent me the link to an article from an Australian publication, The Lead (linked above) in which the wind energy apologist was writing about the "best wind farm" in Australia:
Hornsdale is touted as Australia's "best'' wind farm project due to its high capacity factor of almost 50 per cent when compared to other wind farms in Australia which operate between the high 30s or low 40s.

I did not recall seeing that term before, and it was not one of the wiki synonyms for "nameplate capacity." But now that I have had time to think about it, that makes sense. At its simplest, nameplate capacity and capacity factor are measured in different units. The former is often measured in MW while the latter is almost always a percentage.

Be that as it may, within hours of seeing "capacity factor" in that Australian publication, I saw it in a linked article from Forbes, sent to me by a reader. Very coincidental.

Here are some data points from the Forbes article:
The idiosyncratic physics of electricity will ultimately doom the aspirational goals of the new 1,560 page [Obama] Clean Power Plan, more than will an army of lobbyists, lawsuits and laborious studies. It is an inconvenient truth that electricity is profoundly different from every other energy source society uses; it is, in fact, weird.
In energy equivalent terms, the nation’s electric utilities deliver 5 oil supertankers every day. This feat is performed on a network where operational dynamics and disasters can happen at near lightspeed. And here is the critical singular fact: Over 99 percent of all electricity has to be generated at the same instant that it is consumed.  Try doing that with wheat, steel, or oil.
Thus the problem: The [Obama] Clean Power Plan (CPP), as by now everyone knows, sets a course to radically increase the use of wind and solar power everywhere in America. And, cost aside (which it never is in the real world), it should go without saying that neither wind nor solar are available all the time.
“Availability” is not a semantic nicety. It is a specific and critical technical feature of power plants.
In order for the grid to deliver power continuously and nearly instantaneously in the face of inevitable challenges (plant failures, or the highly cyclical nature of demand), operators must have access to unused capacity that is available to be called upon, any time.
While wind and solar have very low average availability compared to conventional power plants, what is more important is that they have zero availability for many hours at a time every day.
And similarly neither are available, even when operating, to increase output to follow normal daily and hourly demand surges.
The Capacity Factor
It bears noting that “availability” is distinct from another technical, non-semantic, feature of power plants, the “capacity factor” which is a measure of total energy delivery. Unsurprisingly, wind and solar also have low capacity factors compared to conventional power plants: over a year, a megawatt of wind, on average, can deliver less than one-third as much energy as a megawatt of gas turbine. If one rated automobiles this way, for example, capacity factor would measure how often, on average, you were actually able to use your car for all reasons, regardless of how big the car or its engine. Availability is the if, when and how long each day at any given time your car would actually start.

When it comes to cost of capital, capacity factor matters. Simplistically, you need to build three wind or solar megawatts of capacity to equal the energy produced by one megawatt of turbine capacity. (Obviously the exact ratio depends on how windy or sunny the locale.) That means it is just nonsensical to claim a solar or wind plant with a capital cost per “nameplate” megawatt equal to a conventional power plant has achieved the Holy Grail of “grid parity.” And even if you build extra wind and solar capacity, the extra capacity is worthless if it’s not available when needed.
It is availability that matters when it comes to the engineering, and derivatively economic challenge of keeping a grid continuously operating and stable (the latter no small feat). A stable continuous grid is utterly essential for modern society and the hallmark of modernity. Just ask anyone in India, or dozens of other countries plagued with episodic grids.
Storage Doesn't Work For Electricity
Elon Musk has given us a way to illustrate the challenge to store power at grid levels. The astoundingly big $5 billion Tesla battery factory under construction in Nevada, the so-called “gigafactory,” is slated to produce more than all of the world’s existing lithium battery factories combined. For battery cognoscenti, that represents a quantity of batteries each year that can store 30 billion watt-hours of electricity. A big number. But the United States consumes about 4,000,000 billion watt-hours a year. Thus the entire annual output of the gigafactory can store about five minutes worth of U.S. electric demand.
Consider one more example of the scale challenge for storing electricity. Cushing, OK, is home to one of the nation’s preeminent, and numerous, tank farms to store oil. In order to build a ‘tank’ farm to store kilowatt-hours equivalent to the energy stored at Cushing, we’d need a quantity of batteries equal to 40 years of production from 100 gigafactories. Electricity is hard to store.
Good, one burr under the saddle removed. I finally read that article. Putting Elon Musk's gigafactory into perspective was worth the read.

President Obama is pretty smart they say. The Economist is a fairly respected publication. Almost two years ago, The Economist had the European experience with intermittent energy figured out: how to lose half a trillion euros.
On June 16th, 2013,  something very peculiar happened in Germany’s electricity market. The wholesale price of electricity fell to minus €100 per megawatt hour (MWh). That is, generating companies were having to pay the managers of the grid to take their electricity. It was a bright, breezy Sunday. Demand was low. Between 2pm and 3pm, solar and wind generators produced 28.9 gigawatts (GW) of power, more than half the total. The grid at that time could not cope with more than 45GW without becoming unstable. At the peak, total generation was over 51GW; so prices went negative to encourage cutbacks and protect the grid from overloading.
The trouble is that power plants using nuclear fuel or brown coal are designed to run full blast and cannot easily reduce production, whereas the extra energy from solar and wind power is free. So the burden of adjustment fell on gas-fired and hard-coal power plants, whose output plummeted to only about 10% of capacity.
These events were a microcosm of the changes affecting all places where renewable sources of energy are becoming more important—Europe as a whole and Germany in particular. For established utilities, though, this is a disaster. Their gas plants are being shouldered aside by renewable-energy sources. They are losing money on electricity generation. They worry that the growth of solar and wind power is destabilising the grid, and may lead to blackouts or brownouts. And they point out that you cannot run a normal business, in which customers pay for services according to how much they consume, if prices go negative. In short, they argue, the growth of renewable energy is undermining established utilities and replacing them with something less reliable and much more expensive.
Germany has built a low-carbon energy business to the point where new solar power needs few subsidies; where wholesale energy prices are falling and threats to the reliability of the grid have not materialised. What’s the problem?
There are several. First, utilities have suffered vast losses in asset valuation. Their market capitalisation has fallen over €500 billion in five years. That is more than European bank shares lost in the same period. These losses matter in their own right. For pension funds and other investors, they represent lost capital and lower future earnings. For employees, they translate into lower wages and lost jobs. The losses—many of which predate the boom in renewable energy—have come on top of the huge sums Europeans have also spent on climate-change policies. Subsidies for renewable energy are running at €16 billion a year in Germany (and rising); the cumulative cost is around €60 billion. [A disconnect? See previous paragraph.]
Next, utilities have lost their investment role. Once they were steady, reliable and inflation-resistant, the US Treasuries of the equity markets. Pension funds need such assets to balance their long-term liabilities. But utilities no longer play this role, as evinced not just by collapsing share prices but by dividend policies. Until 2008 the yields of RWE and E.ON tracked German ten-year bonds. Since then, they have soared to around 10%, while government-bond yields have stayed flat. Renewables are not the only risky energy investment.
Most important, the decline in utilities’ fortunes raises disturbing questions about the future of Europe’s electricity system. To simplify: European countries are slowly piecing together a system in which there will be more low-carbon and intermittent energy sources; more energy suppliers; more modern power stations (replacing coal and nuclear plants); more and better storage; and more energy traded across borders. All this will be held together by “smart grids”, which tell consumers how much power they are using, shut off appliances when not needed and manage demand more efficiently.
And there it was! The Economist calling wind and solar energy what it is: intermittent energy.

Americans prefer reliable, continuous energy, not unreliable, intermittent energy. On top of that, this new unreliable, intermittent energy will be more expensive.

The Suicide of Liberal Arts
A Note to the Granddaughters

One of the best gifts I received while in high school was an 8-week summer course (between my junior and senior years) in liberal arts at St Olaf College in Northfield, Minnesota. This op-ed piece in today's WSJ was of interest:
Liberal arts has not been killed by parental or student philistinism, or the cupidity of today’s educational institutions whose excessive costs have made the liberal arts into an unattainable luxury. In too many ways the liberal arts have died not by murder but by suicide.
To restore the liberal arts, those of us who teach should begin by thinking about students. Almost all of them have serious questions about major issues, and all of them are looking for answers. What is right? What is love? What do I owe others? What do others owe me? In too many places these are not questions for examination but issues for indoctrination. Instead of guiding young men and women by encouraging them to read history, biography, philosophy and literature, we’d rather debunk the past, deconstruct the authors and dethrone our finest minds and statesmen.
When properly conceived and taught, the liberal arts do not by themselves make us “better people” or (God knows) more “human.” They don’t exist to make us more “liberal,” at least in the contemporary political sense. But the liberal arts can do something no less wonderful: They can open our eyes.
They show us how to look at the world and the works of civilization in serious and important and even delightful ways. They hold out the possibility that we will know better the truth about many of the most important things. They are the vehicle that carries the amazing things that mankind has made—and the memory of the horrors that mankind has perpetrated—from one age to the next. They teach us how to marvel.


SCOOP/STACK: STACK (Sooner Trend, Anadarko, Canadian, and Kingfisher) and SCOOP (South Central Oklahoma Oil Province) plays.


October 6, 2021: update, RBN Energy.

January 6, 2017: natural gas trends in the STACK.  

December 13, 2016: CLR reports a record well in the STACK -- but it doesn't compare with record Bakken well. And the STACK well was only 45% liquids; Bakken wells are 94% oil.

September 7, 2016: Devon sees tighter spacing in the STACK. Compare with Bakken. 

August 3, 2016: Newfield increases CAPEX to take advantage of STACK; Newfield sells all Texas assets to focus on STACK; Newfield average EUR curve in the STACK increased by 15% to 1.1 million boe.  

July 25, 2016: CLR reports its record well in the Meramac, STACK

July 19, 2016: Devon reports its record well in the Meramac, Stack.

June 20, 2016: STACK at about $15,000/mineral acre.

June 10, 2016: RBN Energy update on STACK.

June 6, 2016: Harold Hamm making money on $45 oil in STACK

February 25, 2016: buildout continues -- RBN Energy.

February 19, 2016: still attracting new investors

December 7, 2015: Devon to buy 80,000 STACK acres for $1.9 billion.

November 19, 2015: Newfield, STACK, SCOOP and comparison with the Bakken, Zeits

Original Post
CLR's stealth play is no longer stealth. CLR added STACK to its portfolio of world-class assets announced at its 2Q15 earnings/conference call.
  • defined as base of the Woodford to the top of Meramac, approximately 700 to 1,200 feet thick at depths of 9,000 to 17,000 feet (similar to depths of the Bakken to the Red River wells in North Dakota)
  • first STACK well: impressive flow rate of 2,076 boepd
  • 136,400 net acres; 60% held-by-production
From Natural Gas Intel:
The STACK refers to the stacked oil producing formations in Northern Oklahoma, but the exact definition of the play depends on which company you ask. Newfield Exploration (NFX) coined the term STACK, and announced the play to the world on its 3Q13 earnings conference call.
NFX defines the STACK as being the combination of the Meramec & Woodford shales in the northern part of the Cana-Woodford Shale fairway, covering parts of Blaine, Canadian, Custer, Dewey, Kingfisher, and Logan Counties, Oklahoma.
However, Todd Dutton, President of Longfellow Energy, remarked to NGI in March 2014 that he believes the STACK play extends farther north into Major, Garfield, Logan, and Payne Counties, and includes that portion of the Mississippian Lime as well. American Energy Partners calls its Woodford Shale/Mississippi Lime acreage in Oklahoma the “CNOW play,” while Devon Energy simply calls this area the Mississippian-Woodford trend.
And more from the same link:
But that is not to say what the industry has called the Mississippian Lime, which straddles the Oklahoma/Kansas border, and the STACK formations are one in the same. According to Dutton, there are key differences between the two areas.
Both the Mississippian Lime and Woodford Shale intervals are thicker in the STACK, and the portion of the Miss Lime within the STACK tends to have a higher oil saturation, with less produced water. Moreover, the Woodford is a primary producing formation in the STACK, but is more of a secondary contributor within the Mississippian Lime.
NFX noted on its 3Q14 earnings conference call in late October 2014 that even at WTI oil prices in the low $80s, the STACK still achieves a 30%-50% rate of return on D&C costs of $10 million per well. The company had delineated roughly 2/3rds of its 165.000 net acreage position at the time it reported its 3Q14 results.

Katie Ledecky Destroy World Mark In 800 Free At World Championships -- August 8, 2015

Katie Ledecky destroys world mark in 800 free at world championships

Katie Ledecky Becomes First Woman Under 8:10 In 800m Freestyle

Katie came in first, shaving more than three seconds off her own world record. She had time to take off her goggles, look at the "scoreboard," heat some tea, and cut a slice of Babka while waiting for the #2 finisher to touch the wall, ten seconds later.  

Link here.
It very well may be time to come up with some new descriptors for what Katie Ledecky is doing to the world record books. Smashed. Annihilated. Scorched. These no longer are sufficient for what she has accomplished in the pool the last two years, nor what she is likely to do in the next two or five or 10.
The 18-year-old broke her 10th career world record Saturday night, claiming her ninth straight world title in winning the women’s 800-meter freestyle final at the world swimming championships in Kazan, Russia.
Ledecky finished in a time of 8 minutes 7.39 seconds, shaving more than three seconds off her own world record that she has now broken three times in three consecutive years and is nearly seven seconds clear of the next fastest performer in history.
With the finish Ledecky becomes the first swimmer, male or female, to win titles in the 200, 400, 800 and 1,500 freestyle events at a single world championships — a feat Post reporter Dave Sheinin has dubbed the “Ledecky Slam.” She also joins Michael Phelps and Ryan Lochte as the only swimmers to win four individual world titles in a single year. She swam the anchor leg on the U.S.’s winning 4×200 free relay too, giving her five golds in seven days in Russia.
New Zealand’s Lauren Boyle finished 10 seconds back of the 18-year-old Bethesda, Md., native, touching in 8:17.65. Jazz Carlin of Great Britain was third in 8:18.15, edging Australia’s Jessica Ashwood by .26 seconds.
The performance may be the Bethesda native’s best yet, and unlike the 1,500 free, an event she set the world record twice in two days earlier in the week, the 800 free is an Olympic event. With her new found dominance in the free events, Ledecky becomes the favorite for three individual golds next summer in Rio.
Like Phelps, Ledecky has now broken 10 world record between her first Olympic Games and second world championships. Phelps broke the world records in the 200 butterfly and 200 and 400 individual medleys three times apiece, plus the 100 butterfly mark once between 2001 and the 2003 world championships in Barcelona. Ledecky has broken the 1,500 free five times, the 800 free three times and the 400 free twice.
Let's see how fast someone can get this race posted on YouTube.

Another link here:
In her last swim of the 2015 World Championships Katie Ledecky became the first woman ever to break 8:10 in the 800m freestyle with a winning time of 8:07.39.
Not only did she break her 8:11.00 world record from 2014, she picked it up, threw it on the ground, and stepped up on it until there was nothing left. With an 8:07.39, Ledecky took an incredible 3.61 seconds off her previous mark. That’s the second largest world-record drop ever in the event behind Tracey Wickman who beat her own world record by 5.91 seconds in 1978.
As if beating her own mark wasn’t enough, Ledecky won the final by over 10-seconds. Second place finisher Lauren Boyle of New Zealand earned the silver with an 8:17.65, which is still an amazing performance in the event if you keep a blind eye to all of Ledecky’s swims.
The time makes her a whopping 6.71 seconds faster than the second fastest performer ever in the event, Rebecca Adlington of Great Britain, and 8.53 seconds faster than the third fastest performer ever, Jazz Carlin.
Ledecky now owns seven of the top 10 fastest performances ever in the women’s 800m freestyle.
It was quite generous of Lauren Boyle to let Katie Ledecky to have ten seconds of singular fame at the wall. 

CLR's 2Q15 Earnings Transcript -- August 8, 2015

Link here.

This is not an investment site. Do not make any investment or financial decisions based on what you read here or think you may have read here. In a long note like this, there will be factual and typographical errors. In addition, it is often difficult to sort out facts from opinions (either from me or the source). If this information is important to you, go to the source.

A little bit on finances first and opening comments
  • on track to align CAPEX with cash flow
  • production this quarter hit a record, and cash costs such as G&A and LOE came in significantly below guidance (EOG said something similar regarding LOE)
  • increased production guidance for 2015 (though we find out later, that it will decrease 2H)
  • officially adding STACK to CLR's portfolio of world class assets
  • defined as base of the Woodford to the top of Meramac, approximately 700 to 1,200 feet thick at depths of 9,000 to 17,000 feet ((similar to depths of the Bakken to the Red River wells in North Dakota)
  • first STACK well: impressive flow rate of 2,076 boepd
  • 136,400 net acres; 60% held-by-production
  • Woodford and Springer completions
  • drilling efficiencies still being studies; too early too comment
  • one-third of production from the SCOOP was crude oil
  • one-third of our 460,000 net acres of leasehold in SCOOP is prospective for dual zone development, where the Woodford is greater than 225-feet thick (compare with 40 feet for the middle Bakken)
Drilling program
  • Bakken: 10 (could be cut by 2 if pricing necessitates)
  • SCOOP: 10
  • Northwest Cana: 4
  • STACK: 1
Cost reductions
  • about 20% at mid-year compared to year end 2014; mostly due to service sector (differs from EOG's comments); mostly on the completion side
  • At $50 WTI, CLR would outspend cash flow by $150 - $200 million during 2H15; this is without the benefit of additional cost reductions;
  • drilling time reduced from average of 17.6 days to 16.6 days (quarter-over-quarter); seven sub-14-day wells drilled in the second quarter
  • enhanced slick water and hybrid completions
  • targeting an average of 800K EURs per well compared to an average EUR of 550,000 boe for 2014; 45% increase in EUR; along with well cost reductions, essentially cuts 2015 Bakken finding and development costs in half compared to 2014
  • for every dollar spent in the Bakken in 2015, we are getting 80% more reserves than we did in 2014
  • ten years of drilling inventory at 775K boe, averaging 15 rigs (note: CLR is at 10 rigs now and could cut to 8)
  • slick water hybrid completions continue to deliver initial 90-day production rate uplifts of 50% and 40% respectively compared with offset legacy completions in Williams and McKenzie Ccounties
  • projecting another 25% to 45% in our EUR for these enhanced completions
Harold Hamm comments:
Oil supply and demand will re-balance. In terms of the supply rebalancing coming out of this paradigm shift we're watching several key factors. The US oil production growth curve is turning over, so the primary source of the world's supply growth will not be there in the last half of 2015 nor 2016, given all the rigs the industry has laid down. Secondly, we're not seeing enough supply growth worldwide to offset the natural declines in production. OPEC has announced plans to reduce production beginning in September, and we think that may be the first of many.
Finally, we're seeing meaningful world demand growth led by low oil prices which will be rebalancing. This energy paradigm shift will have profound long-term consequences worldwide, starting with US crude exports ban being lifted so America can finally compete freely in world energy markets and receive the full value for our oil in contrast to Brent selling at a 10% premium today and 20% for much of the last four years. US oil exports simply make too much sense economically, especially as this administration moves to lift restrictions on our Iranian oil exports.

Stealth Plays

September 6, 2011, Encore
January, 2012, conference
September 21, 2014, CLR-Springer
October 12, 2012, SCOOP

Saturday, August 8, 2015

The Katie Ledecky Page

The big race is tonight (results here).

In the meantime, enjoy this story from 538 Sports: Somebody Get Katie Ledecky A Time Machine.

The Arctic Black Gold Rush

The big story this past week is Putin's gambit to take the Arctic. I've talked about the Arctic Black Gold Rush at length (I track it here) and how the Obama administration has chosen not to participate. Fox News is reporting but you can find the story everywhere if you don't trust fair and balanced:
Republican lawmakers slammed the Obama administration this week after Russia announced it had submitted a bid to the United Nations for huge areas of the Arctic that could contain vast quantities of oil and gas, with one lawmaker describing the application as evidence of a “strategic blunder” on the part of the administration's foreign policy.
Russia’s foreign ministry said in a statement Tuesday that Moscow was claiming over 463,000 square miles of Arctic sea shelf, extending more than 350 nautical miles from the shore.
The Arctic is believed to hold up to 25 percent of the planet’s untapped oil and gas supplies. Russia, the U.S. and Canada are among those trying to assert jurisdiction over parts of the region. 
Sen. Dan Sullivan, R-Alaska, told he isn’t surprised by what he called Russia's “latest attempt to grab territory in the Arctic” and noted that the move comes after Vladimir Putin has been amassing forces in the region.
“Meanwhile, in the face of this Russian military buildup, we are significantly reducing Army forces in our nation’s only Arctic state, Alaska. This is a strategic blunder by the Obama administration,” Sullivan said.
The Obama doctrine is not to show force, but to rely on his stellar negotiating skills. Those are his words (paraphrased, not mine) based on his "Iran deal."

Venezuela Is In A World Of Pain

PanamPost is reporting that things are out of control in Venezuela:
It’s the law of the jungle in Venezuela, as shopping for groceries becomes an increasingly dangerous activity. As the shortage crisis worsens, more and more angry mobs are raiding the nation’s supermarkets, looting whatever basic goods they can find.
During the first half of 2015, the Venezuelan Observatory for Social Conflict registered no fewer than 132 incidents of looting or attempted looting at various stores throughout the country. In addition, Venezuelan consumers staged over 500 protests that condemned the lack of available products at state-run grocery stores, markets, and pharmacies.
With an average of 14 protests per day, the unrest has Venezuela “trapped in a spiral of social and political conflicts that grow over the months, and which could become more acute due to the forthcoming parliamentary elections,” the observatory notes in its report.
High inflation and the drastic decline in the value of the bolĂ­var on the black market has hit wages hard. Venezuelans currently earn the lowest incomes on the continent, with a minimum wage of US$10.87 per month, based on the unofficial exchange rate.
See also this post from November 25, 2014