Monday, November 7, 2016

There Is No Free Lunch -- Not Even For Tesla Owners -- November 7, 2016

From The Wall Street Journal: Tesla Motors plans to charge for its Quick-Charge Access as Model 3 launch approaches. Tesla scales back how much new drivers can use its fast-charging stations without paying.
Tesla Motors Inc. next year will stop providing unlimited free access to its fast-charging stations for new buyers of its electric vehicles, a move intended to help pay for the charging network and the launch of a cheaper and higher-volume electric sedan.
Tesla has gained notoriety for free access to proprietary stations that can recharge its $66,000 and up cars in far less time than a conventional charger. While the company’s investment in the “Supercharger Network” has been steep, it considers the cost a replacement for the hefty sums most auto makers dish out for advertising or sales incentives.
The Silicon Valley auto maker introduced the perk four years ago and expanded it to Europe and Asia. But buyers of vehicles ordered after January 1, 2017, will have to pay for charging after using 400 kilowatt-hours of charging annually, equal to about 1,000 miles of travel
How much will it cost to re-charge? "Less than the price to fill up a "comparable gas car." Whatever that means. 
The Supercharger network has 734 locations world-wide, according to the company. Car sales growth has strained the network’s capacity, and Tesla has worried about its ability to offer service.
Tesla has said it has 373,000 reservations for the Model 3.
“The increasing number of Model S and Model X vehicles, as well as the significant increase in our vehicle fleet size that we expect from Model 3, will require us to continue to increase the number our Supercharger stations significantly,” the company said in a quarterly filing this month. “If we fail to do so, our customers could become dissatisfied, which could adversely affect sales of our vehicles.”
Mr. Musk first hinted at the company’s annual meeting in 2015 that the charging network could change, noting that some people were “abusing” the system by using it for daily charging rather than for quick fill-ups between cities. This was causing congestion at the stations.
“There are a few people who are quite aggressively using it for local supercharging,” he said at the time. “We’ll sort of send them just a reminder note that it’s cool to do this occasionally, but it’s meant to be a long-distance thing.”
More at the link. 

Active Rigs Up To 38 In North Dakota -- November 7, 2106

Great video. Talk about stereotyping. From Carpe Diem. Meanwhile, Governor Schwarzenegger -- wasn't he an Austrian -- wants to send me to a gas chamber. And not the good kind.

Russian Northern Fleet: seems to be moving quickly ahead -- earlier today it was just west (and north of Cyprus); it is now -- based on a ping nine minutes ago (about 5:00 p.m. Central Time), the fleet was almost past the strait that separates Cyprus from Turkey. Speed has picked up considerably: now 13.4 knots; previously the high I had seen was 12.5 knots and generally the fleet was moving at 11.1 knots. It looks like about 300 km to the Syrian coast.

Back to the Bakken

Active rigs:

Active Rigs3864193181188

One well coming off the confidential list Tuesday:
  • 31732, 1,691, Newfield, Lost Bridge Federal 148-96-9-4-2H, Lost Bridge, t9/16; cum 4K over 3 days;
No new permits.

Four producing wells (DUCs) completed:
  • 32033, 540, CLR, Norfolk 11-1H, North Tobacco, t10/16; cum 3K after 9 days;
  • 32034, 460, CLR, Norfolk 10-1H1, North Tobacco, t10/16; cum --
  • 32035, 630, CLR, Norfolk 9-1H, North Tobacco, t10/16; cum --
  • 32036, 365, CLR, Norfolk 8-1H1, North Tobacco, t10/16; cum -- 

31732, see above, Newfield, Lost Bridge Federal 148-96-9-4-2H, Lost Bridge:

DateOil RunsMCF Sold

Latest Update On The Russian Northern Fleet, Nearing Syria; Nothing About The Bakken -- November 7, 2016

Update: The Russian Northern Fleet

Latest ping: four minutes ago.  11.5 knots, upper end of cruising speed; range has been 11.1 to 12.5 knots while in the Mediterranean. The journey is almost complete. The ship is entering the strait between Cyprus and Turkey. It's possible some sailors might even see smoke billowing over Aleppo. Russian attack helicopters are "swarming" over Homs province.

It's amazing how "high up" the Google list my blogging on the Russian Northern Fleet has reached. Hoo-aah!

Dante's Comedy

It's funny how things work out. Without question, the blog has been one of the most important things in my retirement. The granddaughters, of course, top that list, and cross-country trips from Texas to North Dakota and to California and to Utah/Colorado are also near the top.

With or without the blog, I would have continued the aggressive reading program I began in 2007. In fact, the blog began as a "literature" blog back in 2007 with some notes on the Bakken. In a fit of insanity, I deleted the original blog sometime in 2009 and started over, with a focus on the Bakken.

From my perspective, the blog would have become tedious had I not included posts on other subjects that interested me. Completely unexpected is the direction many readers have taken me with their suggestions.

Most incredibly was one suggestion from a reader that I read Dante's Inferno.

I have started (reading the Inferno). I now "understand" it. I use that word "understand" very loosely and with too many qualifications to list.

For my granddaughters, I would recommend sometime in high school -- maybe in their senior year -- they set aside one weekend and "get to know" Dante and his Comedy.

I would have them read the first three cantos as translated by Hollander. That will take all of 15 minutes.

Then, perhaps, the essay by Harold Bloom in his Western Canon on Dante and the Inferno. That would be a full hour.

Then, I would take a break for dinner.

After dinner, I would read Joseph Gallagher's introduction to A Modern Reader's Guide to Dante's The Divine Comedy. That would take another 30 minutes.

At that point, I would leave it up to them, whether to continue or not. That would be Friday night, leaving the rest of the weekend to continue reading Dante or going surfing off the coast of Huntington Beach, California.

For me, I can say definitively I began to read Dante's Comedy during the first week of November, 2016, and will continue to read parts of it every so often until I can no longer read.

Some Notes From Gallagher

Who was he?

Middle-income background, b. in Florentine, Italy, in 1265, middle Ages.

Died at the age of 57 of malaria in Ravenna, Italy, 1321.

May have started writing the Comedy as early as early as 1301, starting about 36 years of age, but mostly likely, the bulk of it was written during his least ten years of life.

How important is it?

At the end of the day, this is the canon: Homer, Virgil, Dante, Shakespeare.

Harold Bloom: Dante and Shakespeare do not "belong" in the Western Canon -- "They are the Western Canon."

There are said to be more books written about The Divine Comedy than about any other single work of literature (the Bible is a collection -- not all by the same author). According to the authority on such things, only Shakespeare has had more lists of books compiled about him than Dante.

The poem:

A terza rima (see below), which Dante invented.

Each line is exactly the same length: eleven (11) syllables in each line; such a line is called a hendecasyllabic, from the Greek hen (one) and deka (ten).

Many lines are easily read as a sonnet line of iambic pentameter (five sets of ba/BOOM beats but with one extra syllable at the end. Hamlet's famous line is hendecasyllabic: "To be or not to be, that is the question."

100 cantos (songs) of various lengths.

Divided into three parts: the Inferno (4,720 lines); the Purgatorio  (4,755 lines); and, the Paradiso (4,758 lines).

Total length: 14,233 lines (Homer's Iliad, 15,693 lines; his Odyssey, 12,110 lines; Virgil's Aeneid, 9,890 lines).

Apart from the introductory canto in the Inferno, each major section contains 33 cantos, for the sum of a perfect 100.

The poem rhymes. Unlike the Iliad, the Odyssey, and the Aeneid, the Comedy rhymes. Rhyme, practically unknown to the ancient Greeks and Romans, was introduced to the West with the hymns of the early Christian Church>0

Dante's basic unit: terzine (tercet), a 3-line stanza;
  • first and third lines rhyme (aba)
  • the rhyme of the middle line becomes the rhyme for the first and third lines of the next terzine (bcb)
The terza rima gets its name from having a "third rhyme" -- that is, a third rhyming word.

Documentary advantages of terza rima:
  • it is easy to see when a line has been dropped out; and,
  • it is hard to insert bogus lines

Production Gains In Texas, GOM, North Dakota Drove The US Oil Industry In 2015 -- EIA; Financial Times On Oil "Rally" -- November 7, 2016

Despite tanking prices in 2015:
U.S. field production of crude oil increased in 2015 for the seventh consecutive year, reaching 9.42 million barrels per day (b/d).
This was the highest crude oil production level since 1972, based on final production numbers in EIA’s Petroleum Supply Annual. In 2015, production gains were highest in Texas, the Gulf of Mexico, and North Dakota, as these three regions accounted for 77% of the U.S. total increase.
Although annual production for 2015 grew, monthly U.S. crude oil production has declined since April 2015. Lower oil prices led to slower development activity, and production fell to 8.74 million b/d in August 2016, the latest month for which survey data is available. --- EIA
OPEC Throws US Oil Industry A Lifeline

The magic numbers:
  • $40 oil: a lifeline for the US oil industry; they may or may not hang on
  • $50 oil: they hang on and the US oil industry survives
  • $60 oil: the US oil industry thrives
From Financial Times:
US producers took advantage of the brief rally to buy insurance against a weaker market in 2017, analysts say. Government data reveal that the category of trader that includes producers increased forward sales of WTI futures and options contracts by 4 per cent to 608m barrels equivalent — the biggest gross short position on record — in the two weeks between September 27 and October 11. 
OPEC was trying to shore up the price and the fundamentals of this market, but they inadvertently threw US producers a lifeline,” says Michael Tran, energy analyst at RBC Capital Markets. “US producers jumped on it and hedged production.”
Oil companies have over the past two weeks given upbeat views on the outlook for US production.
Chevron, which has a large land holding in the Permian Basin of western Texas, said its shale production had been running ahead of expectations and was up 24 per cent over the past year. The company said it was on course for 250,000-350,000 barrels of oil equivalent of production from the Permian by the end of 2020, up from a little under 150,000 boe/d today. 
EOG Resources, one of the leading independent oil producers, raised its projected growth rate for 2017-20. William Thomas, chief executive, told analysts on a call that cost reductions meant that with $50-$60 oil, “we are now capable of growing a compounded 15 per cent to 25 per cent annually”.
Other companies have been talking about stepping up the rate at which they are drilling and completing wells. John Hess, chief executive of Hess, a US exploration and production company active in the Bakken formation of North Dakota, told analysts last month: “With the recent improvement in oil prices, we are making initial preparations to increase our drilling activity in the [Bakken] play next year.” 
Continental Resources said it had raised its planned capital spending for 2016 by 20 per cent, as it starts bringing into production some of the wells it had drilled but not completed in the Bakken formation
Virtually all of the growth in production last August came from federal waters in the Gulf of Mexico, not shale regions on land. One new offshore project was Noble Energy’s Gunflint field, which the company said went online in mid-July and was operating at “higher rates than expected”. 
Another analyst who lives under the Geico Rock:
The effect of the rise in drilling rigs should also not be overstated, as they are well below the count at the height of the shale boom and it takes time to drill and complete new wells. “Production is not a light switch,” says Energy Aspects, a consultancy.
Notes to the Granddaughters

I've certainly entered my "Dante phase." As mentioned earlier, I have begun reading Dante's Inferno on the advice of a reader. The "bible" appears to be Hollander's translation and commentary which is where I started and which will remain my primary source. Over the weekend, I read an essay in Harold Bloom's Western Canon on Dante's Inferno. Now at the library, I have found two more books that will complete my little Dante library. The first is a small Harold Bloom monograph on Dante as part of Bloom's series on "major poets." DDS: 851.1 DAN. The second is Gallagher's The Divine Comedy, A Modern Reader's Guide to Dante's Divine Comedy, DDS: 851.1 GAL.

The weather radar map suggested I might just be able to beat the thunderstorm if I bicycled very, very fast. The first four miles were beautiful but mildly unsettling. With a mile to go, it started to drizzle, and with only a half-mile to go, a fairly good downpour. But all in all, I made it to the library in pretty good shape. The trick will be getting home. LOL Wow, coffee (especially free Starbucks coffee) tastes great on a coolish, rainy day.

From the Dallas Morning News today: there are four art exhibits in Dallas-Fort Wroth you must see right now, from Monet to 'Divine Felines." We have already seen the Monet exhibit at the Kimball Museum. In fact, we have visited twice (blogged on this earlier) and I will return twice more, including once with the granddaughters and once more by myself, just to take one last look at this incredible collection that I will never, never see again. From the linked article:
The most conventionally important and beautiful of the four is surely the Kimbell Art Museum's survey of the first decade-and-a-half of the career of Claude Monet — the first such exhibition ever mounted. From one of his earliest known paintings of 1858 to the masterpiece of sailboats on the Seine painted on a summer day in 1872, this exhibition, "Monet: The Early Years," is masterfully curated by the Kimbell's deputy director, Dr. George Shackelford, one of the world's authorities on impressionism.
Shackelford has persuaded the most stubborn of museums and the most private of private collectors to part with their works and has, after two years of arm-twisting and sweet-talking, put together a superlative group of 56 paintings, many of which have never before been seen in Texas and some of which have not been included in any Monet exhibition in decades (or ever).

Power And Utility Deals -- Summary -- 3Q16

Staggering. That's all I can say about this graph. Compare the graph below with the labor force participation graph. Wow. Apples and oranges. But it sure speaks volumes.

The graph above is for the past ten quarters, including the most recent quarter. 3Q16 was the strongest quarter by far.

$78 billion in 3Q16 deals simply dwarfs the previous "records" set back in 3Q15 and 1Q16.

But then take another look. 2016 as a whole knocked "it" out of the ballpark:
  • 2016: 78+28+41 = $147 billion in deals (and that does not include the 4th quarter, still to come)
  • 2015: 12+45+3+7 = $67 billion
In fact, the $67 billion in all of 2015 was less than the most recent since quarter (3Q16).

I assume the "deal volume" (grey line) was all deals whereas the red bar graphs included only those deals great that $50 million. One wonders if the larger number of deals in 4Q14 were small wind and solar deals made to take advantage of expiring tax credits.

The story is at PwC Deals: The key announced transactions in 3Q16(some business names were abbreviated):
  • Enbridge agreed to acquire Spectra in an all - stock takeover ; the transaction is valued at $ 47.0 billion
  • NextEra definitively agreed to merge with the bankrupt Energy Future Holdings, a Dallas - based electric power distributor, for $ 18.7 billion
  • Southern Company acquired a 50 percent interest in Southern Natural Gas Company from Kinder Morgan Energy Partners for $2.7 billion
  • A joint venture owned by Blackstone Group  and ArcLight Capital Partners agreed to acquire four power plants of American Electric Power Co., for $2.2 billion. 
  • Columbia Pipeline Group, Inc. planned to acquire a 53.5 percent interest in the Houston - based Columbia Pipeline Partners for $2.1 billion
  • DTE Energy Company agreed to acquire a 55 percent interest in the Stonewall Gas Gathering System from M3 Midstream  ( 40 percent) and Vega Energy Partners ( 15 percent). Concurrently, DTE Energy Company acquired the Appalachia Gathering System of M3 Midstream. The combined transaction was valued at $1.3 billion
It should be noted that the data includes all power sources: fossil, nuclear, hydroelectricity, wind, and solar. One might want to go through the list above and note the nuclear, wind, and solar deals.

EV Corridor Announced For America-- November 6, 2016

Link here. Data points:
  • fifteen states won't be part of the "federal corridor"
  • $4.5 billion in guaranteed loans
  • for folks willing to build chargers that will charge an EV up to 80% in "about" 30 minutes
Am I missing something? $4.5 billion for a federal program like this? In a country already with $19 trillion in debt, it seems they could have "allocated' $10 billion in guaranteed loans and included all 50 states, DC, and Puerto Rico? Warren Buffett's Berkshire Hathaway closed the third quarter with $85 billion in cash. $4.5 billion seems such a pittance for such an important initiative.

This is just guaranteed loans. It's not a real expenditure.

Let's see, $19,000,000,000,000.

Or $19,004,500,000,000.

0.02% of the deficit. And the $4.5 billion would be spread out over many years, and again, just loans.

By the way, this new initiative pretty much tells me all that "concern" in Washington, DC, about the crumbling infrastructure across entire US is a bit of hyperbole. $4.5 billion for automobiles that represent less than 1% of cars sold, and most of which are sold on the west coast, tells me where the real interest is. In addition, those EVs running on coal energy won't be paying gasoline taxes to support the highways they are using.

Active Rigs Up To 38 -- November 7, 2016

5.0 earthquake hits Cushing, Oklahoma; major damage to city. Early reports suggest pipelines, storage tanks "okay."

Will this be the last USC-Los Angeles Times poll?


$65 oil. Who are they trying to kid? FuelFix says EOG looks like a winner at $65 oil. Other data points:
  • cuts losses to $190 million
  • doubles Permian oil estimates
  • Yates (Permian) bought for $2.34 billion this quarter
  • CEO calls 2016 a "breakout year" for EOG
  • EOG now more than doubles it total oil & gas recovery estimates in the Permian's Delaware Basin, from 2.35 billion bbls to 6 billion (that comes close to tripling its "original" estimate)
  • company pumped 275,700 bopd 4Q16, at the upper end of its expectations
  • lease and well expenses decreased 18% yoy 
  • at $50 oil, EOG expects 15% annual oil production growth through 2020
Wow, it's hard to believe. One year ago, 3Q15, EOG lost $4.1 billion ($7.47/share). This quarter, one year later, 4Q16, the company cut its losses to almost a trivial amount in comparison. 


Huge implications for the state. Overheard at the deli: North Dakota is already known as the "high-tax" state for oil drillers. With the killing of the Keystone, the Sandpiper, and the DAPL, the state will likely be known as the state that can no longer build the necessary infrastructure to make the Bakken competitive with the Permian. Compare with what Texas is doing in the RBN Energ post below. And heaven forbid if any one duck flies into a waste pit this autumn. Meanwhile slicers and dicers continue to be welcomed with open arms tax credits. 

Active rigs:

Active Rigs3864193181188

RBN Energy: the series continues on natural gas pipelines to LNG export terminals in Texas.
Providing the capacity to transport Marcellus/Utica natural gas to and through the state of Texas to LNG export terminals and to Mexico will require pipeline reversals, new pipe and other enhancements along a combination of interstate and intrastate lines.
In many ways, the long-distance part of the job––the reversal of large-diameter pipelines between the Northeast and the Lower Mississippi Valley––is the more straightforward; the greater challenge will be reworking the complicated pipeline networks between the Texas/Louisiana state line and the U.S./Mexico border. Today we review Texas pipeline projects being planned to allow increasing southbound flows of Northeast gas.
Reversing the direction of natural gas flows between the central/western Gulf Coast and the Northeast is a monumental task that will take a few more years––and a few billion more dollars––to complete. As we’ve covered extensively in the RBN blogosphere, the reconfiguring of key elements of the nation’s gas pipeline network is needed because of fundamental changes brought on by the Shale Revolution.
Since 2008, the Marcellus/Utica shale region in Pennsylvania, Ohio and West Virginia has emerged as a gas-production powerhouse. Output from the three-state area now stands at an extraordinary 22 Bcf/d––nearly one-third of total U.S. production––and favorable production economics in the Marcellus/Utica play suggest that the region’s contribution will only increase through the early 2020s. Aside from U.S. power generation, the major centers of gas demand growth over the next several years are expected to be exports, both in the form of liquefied natural gas (LNG) shipped from new liquefaction/export facilities along the Texas/Louisiana coast and as pipeline gas to Mexico, most of it through existing and planned pipes in Texas.
We’ve discussed the interstate pipeline reversals that will move increasing volumes of Marcellus/Utica gas to Louisiana in several blogs. We’ve looked at major enhancements to Texas’s intrastate pipeline system.  And we also covered the connections between Texas intrastate and interstate pipelines to the LNG export terminals being developed at Freeport and Corpus Christi.