Tuesday, November 8, 2016

PetroChina Expands Receiving Capacity At LNG Terminals -- November 8, 2016

As you read this story, remember four things:
  • the US has a lot of natural gas
  • the US is building a lot of LNG export terminals
  • the US allows LNG exports
  • China's appetite for LNG is growing
Data points from Reuters/Rigzone:
  • PetroChina is one of the larger Chinese oil and gas firms
  • PetroChina has three LNG receiving terminals
  • it is adding new storage tanks for LNG at two of those terminals 
  • one of the sites, Rudong: this is part of a second-phase expansion; will bring handling capacity up to 6.5 million tonnes/year; up from 3.5 million tonnes previously
  • at the second site, Dalian: will double its receiving capacity there to 6 million tonnes/year
  • PetroChina is raising its natural gas supply this winter by 7% year-over-year
  • most of that increase is domestically produced; a "moderate" amount will be due to imports

Wind Energy In The US -- Estimates Through 2017 -- EIA -- November 8, 2016

Over at twitter, the EIA posted a graph to highlight the amount of wind energy that has been brought on line over the past decade here in the US and the amount projected through the end of 2017.

In 2012, the total capacity of US electricity generating plants was approximately 1,100 GW

 90 GW (wind) x 0.20 = 18 GW.

NFL Ratings

Link here.  Last night's game the lowest week 9 MNF game since 2007. I watched the first half, then went to bed, and I'm a fairly involved professional football fan. I'm not sure what it was, why I didn't watch to the end. I know part of it was the announcers. Wow, were they boring. In fact, I mentioned this to my wife the other day: a lot of what keeps me watching an NFL game is the game-calling. If the announcers are good, I tend to stay. Madden was great, "back in the day." The SNF announcers are very good, probably my favorite right now. I enjoy Joe Buck.

Doctor Strange

Wow, I love the library, the movie, the internet, connecting of dots.

I have no clue if I am correct on any of this but it starts to fit. It will be my way of thinking about things and then modifying the "model" as I read more and "understand" more.

I asked my wife what she thought of the "philosophy" underlying or "behind" the movie, Doctor Strange. She said she gave it brief thought but nothing more; she watched the movie and enjoyed it for other reasons.

For me, of all things, seeing the movie I finally understand the concept of the demiurge.

Stan Lee will be 94 years old in December.

Law Of Big Numbers And Why I Love To Blog -- November 8, 2016

In a long and complicated note on October 31, 2016, I estimated that the Saudis were pulling about $7.1 billion out of their cash reserves every month to cover "payroll." (That's in addition to whatever positive cash flow they had on oil exports and refined petroleum exports.)

Today, John Kemp, Reuters analyst based in London, tweeted:

So, that's pretty cool. Confirmation that at current oil prices, Saudi is pulling about $7 billion out of cash reserves every month to cover its "payroll."  Obviously it will change month-over-month, but $7 billion/month seems about right when oil is in the upper 40's.

In the graph above, note that it was in October, 2014, that Saudi Arabia mentioned that it was going to maximize production, regardless of price, to maintain global market share.  Look how fast things changed: by the end of the next quarter, they were deep "into the orange."

Any Doubts That Saudi Arabia Is In Trouble?

Regular readers are aware of the number of big-dollar projects that Saudi Arabia has canceled in the past two years because of their $1 trillion mistake.

Now, over at The Saudi Gazette, the headline: "private sector dues to be cleared by December 31, 2016; signing of SR1 trillion mega projects halted."

The "private sector dues" has to be with all the domestic debt and IOUs the Saudi Arabian government owes its employees, contractors, and citizens.

But in addition, the "act" just signed will also "modify" $266 billion worth of "mega" projects.

Bakken 2.0: Twenty-Four (24) Permits Renewed; Seven New Permits

Regardless of how the presidential election turns out tonight/tomorrow/end of the week/whenever it is decided: at least in this election, Americans went into the polling booth with their eyes wide shut. We discussed that earlier. No one cannot say voters (including the dead and those who voted often) did not know for whom they were voting in this election. Good luck to all. My only hope: that my two granddaughters are "okay" with the outcome. They have followed the campaign intently. At their age, this was all "magic" for me. I hope it remains "magic" for them.


Active rigs:

Active Rigs3864193182189

No wells coming off the confidential list Wednesday; in fact no new wells coming off the confidential list until Saturday.

Seven new permits:
  • Operators: BR (5), Petro-Hunt (2)
  • Fields: Croff (McKenzie), Charlson (McKenzie)
  • Comments: the BR permits are for a 5-well pad
Twenty-four permits renewed:
  • CLR (10): four Hartford and four Dover permits, all on the same 8-well pad in Williams County; two Thorvald permits in Dunn County
  • Oasis (5): five O M Erickson permits in Williams County
  • EOG (3): three Van Hook permits in Mountrail County
  • Hunt (2): a Nichols permit and a Palermo permit, both in Mountrail County
  • NP Resources (2): two McDonald permits in Billings County
  • Hess: one BW-Hedstrom permit in McKenzie County
  • Petro-Hunt: one Sabrosky permit in Dunn County
Three permits canceled:
  • all three were Triangle USA permits -- one Gullickson Trust and two J Garvin Jacobson permits, all in McKenzie County
Again, another day with no DUCs reported as being completed.

A Note For Our Daughter

May and I saw the 3D Stan Lee movie today: Doctor Strange. Incredibly, incredibly good. Perhaps more on this later.

The previews, unfortunately for upcoming movies, were incredibly violent. For that reason, you really can't take the old granddaughters. I know they both want to see Doctor Strange and perhaps -- a big "perhaps" -- they could see it with you but have them come in after the movie has begun, after the previews are over.

The previews by the way help explain the record number of homicides in Chicago this year. But at least none of the actors are seen smoking cigarettes or doing things without their clothes on.

NOG -- 3Q16

WAYZATA, Minn. , Nov. 8, 2016 /PRNewswire/ -- Northern Oil and Gas, Inc. today announced 2016 third quarter results and completion of the semi-annual redetermination of the borrowing base under Northern's revolving credit facility.

  • Production totaled 1,236,708 barrels of oil equivalent (boe) or the third quarter, averaging 13,442 Boe per day, despite approximately 600 Boe per day of shut-in production during the quarter
  • Oil and gas sales, including cash from settled derivatives, totaled $50.7 million for the third quarter
  • Capital expenditures totaled $15.8 million during the third quarter, a reduction of 42.4% compared to the third quarter of 2015
  • Production expenses of $8.83 per Boe for the third quarter came in at the low end of management's expense guidance
  • Cash flow from operations for the first nine months of 2016 has exceeded capital expenditures, resulting in a $30 million reduction in debt since the beginning of the year
  • On November 8, 2016 , the borrowing base under Northern's revolving credit facility was reaffirmed at $350 million , providing quarter-end liquidity of $233.3 million , composed of $3.3 million in cash and $230.0 million of revolving credit facility availability
Northern's adjusted net income for the third quarter was $2.4 million , or $0.04 per diluted share. GAAP net loss for the quarter was $45.6 million , or a loss of $0.74 per diluted share, which was impacted by a $43.8 million non-cash impairment charge and a $5.6 million loss on the mark-to-market of derivative instruments. Adjusted EBITDA for the third quarter was $33.0 million . See "Non-GAAP Financial Measures" below for additional information on these measures.

Retail Gasoline On East Coast 6 Cents Lower Than National Average -- Colonial Gasoline Pipeline Back On-Line After Spill / Interruption - November 8, 2016

All that anxiety about the Colonial Pipeline gasoline spill and interruption? Never mind:
Gasoline is expected to reach as far north as Charlotte, North Carolina within a day of Line 1's restart. Gasoline shipments on Colonial's system are expected to reach as far north as Baltimore, Maryland, by Tuesday and to reach their northern terminus in Linden, New Jersey, near New York Harbor, by Wednesday.
EIA's weekly retail price for regular gasoline for the Lower Atlantic (PADD 1C) was $2.17/g as of Monday, November 7, virtually unchanged from the previous week, and 6 cents/g below the national average. -- EIA

The Tesla Page

We drove through Prum, Germany, many times when we were stationed at Bitburg Air Base many decades ago. Sleepy little town. I'm not sure why we visited Prum except that we had friends in the area. Link here.
In the midst of seeking investor approval for a merger with SolarCity Corp., Tesla made a surprise announcement that it’s acquiring a small German engineering firm to help automate and accelerate production at its factories.
The carmaker led by tech industrialist Elon Musk said in a blog post today that it plans to buy Grohmann Engineering, based in PrĂ¼m, Germany, and rename it Tesla Grohmann Automation.
The firm, led by founder Klaus Grohmann, specializes in highly automated manufacturing techniques and will help Tesla fulfill Musk’s goal of designing the “machine that builds the machine,” his vision of advanced vehicle production that’s a step change from current conventions.
The Apple Page

Ireland will formally appeal that $14 billion Apple tax ruling this week. Link here.
Apple previously said it is "confident" the ruling "will be overturned" by European courts, but noted the process is "likely to take several years."
Apple said it has "provisioned several billion dollars for the U.S. for payment," but it does not expect any near-term impact on its financial results.
The Atmospheric CO2 Page

Link here. Not much movement in the big scheme of things. Fortunately.
  • October, 2016: 401.57 (an increase of 0.8% yoy FWIW). 
  • September, 2016: 401.01
  • August, 2016: 402.24
  • July, 2016: 404.39
  • May, 2016: 407.70
  • April, 2016: 407.57
  • March, 2016: 404.83
  • February, 2016:  404.16
  • January, 2016: 402.52 
  • October, 2015: 398.29

Missing Persons Page

Whatever happened to Jon Gruber?

Whatever happened to Randolph Scott?

Whatever happened to Randolph Scott, Statler Bros

DAPL -- Army Corps Of Engineers Re-Imagining Things -- RBN Energy -- November 8, 2016

Russian Northern Fleet: has arrived -- almost. The last ping  -- almost two hours ago -- showed the fleet was not far off the coast of Syria. The tug is not moving, suggesting this is probably where the aircraft carrier will stage. 

Track active rig count here: link

Active rigs:

Active Rigs3964193182189

RBN Energy: US Army Corps of Engineers studying options for the DAPL.

OPEC "warns" oil prices will stay low for longer -- Wall Street Journal. 
OPEC says its share of the global market will increase as US output from shale fields slows down. As if that matters, when Saudi Arabia is selling oil for $40/bbl and they need $100-oil but would be "happy" with $80-oil. From the linked article (which seems to be an old article -- it seems I've seen all this somewhere before), data points:
  • crude-oil prices will rebound much less than expected in the next four years 
Let's repeat that:
  • crude-oil prices will rebound much less than expected in the next four years
Note two items within that forecast:
  • much less than expected
  • in the next four years

Back to OPEC's long-term assessment:
  • OPEC assumes oil prices will rise by $5 a bbl in the medium term, reaching $60 by 2020
  • $60 is $20 less than the baseline figure of $80/bbl that it used in 2015 for the beginning of the next decade
And where we stand today, from IEA / MarketWatch:
The U.S. Energy Information Administration on Tuesday (today) raised its forecasts for U.S. crude production for 2016 and 2017.
In its monthly energy outlook report, the government agency forecast U.S. crude output of 8.84 million barrels a day this year, up 1.3% from the previous forecast. For 2017, it sees production rising to 8.73 million barrels a day, up 1.7% from last month's forecast.
The EIA also forecast an average price of $42.84 a barrel for West Texas Intermediate crude this year, up from a previous estimate of $42.78.
Brent crude is seen averaging $43.30 this year, down from the $43.43 forecast in October. December WTI crude (CLZ6) traded at $45.26 a barrel. December Brent crude (LCOF7) at $46.29 a barrel.