Tuesday, May 9, 2017

Global Warming? Rising Seas? Hardly. Ask The Irish -- CNN -- May 9, 2017

From CNN:
The sands at Dooagh on County Mayo's Achill Island vanished in the winter of 1984, leaving nothing but bare rock and rock pools. 
But over the course of a few days in April 2017 the Atlantic returned what it had stolen, depositing thousands of tons of sand and creating a brand new 300-meter golden strand.
The Wild Rover: Dooagh Beach has returned home after 33 years at sea.
The storms of 1984 "completely took every last grain of sand off the beach," Sean Molloy of Achill Tourism tells CNN
But last month, "in the space of about eight or 10 days, these very strong winds came from the north," he explains.
And the beach returned. Fancy that.

The Rocky Horror Picture Show

Post-Production Jump After Neighboring Well Fracked -- May 9, 2017

See this post: http://wellsofinterest.blogspot.com/2017/05/mro-raymond-usa-reunion-bay-18191-may-9.html.
  • prior to neighboring frack: 2,000 bbls/month
  • after the neighboring frack: 12,000 bbls/month

The San Antonio Spurs defeat the Houston Rockets 110 - 107 in overtime, to take a 3 -2 lead in the best of seven series.   

The 21st Century "TV Dinner"

A First For Any Company

Apple hits $800 billion market cap.

Five DUCs Reported As Completed -- May 9, 2017

Active rigs:

Active Rigs502884192183

Four new permits:
  • Operator: CLR
  • Field: Elm Tree (McKenzie)
  • Comments: NESE 25-153N-94W (see graphic below)
Fourteen permits renewed:
  • Enerplus (12): Axe, Poblano, Vise, Cayenne, Anvil, Habanero, Calico, Bengal, Manx, Tabby, Siamese, and Persian permits renewed, all in Dun County
  • Oasis (2): two Hanover Federal permits renewed
Five producing wells (DUCs) reported as completed:
  • 14898, 279, Newfield, Gohrick 1, Helle Slough, t5/99; cum 127K 3/17; (we'll get back to this later)
  • 29477, 970, CLR, Kukla 5-16H11, Chimney Butte, t5/17; cum -- (17398)
  • 30512, 3,255, MRO, Gaynor 34-33H, Reunion Bay, t2/17; cum 53K 3/17; (18191: see this post)
  • 30513, 2,830, MRO, Anton 34-33TFH, Reunion Bay, t2/17; cum 3K 3/17; (18191)
  • 31849, 2,470,  MRO, Ronald 34-33TFH-2B, Reunion Bay, t2/17; cum 29K 3/17;(18191)
If You Have One Well, You Will Probably Have Twelve 

Typo in graphic ("wels") noted; not gonna fix it.

May Day! May Day! -- Comey Fired!

There's a lot of talk of "special prosecutor." That law "expired." There is no law for "special prosecutor any more.

People are confused by the time line.

The real question, the real question that has not been asked: Did Comey see this coming?

It's amazing how fast the mainstream media is trying to frame this narrative. It will be fun to see Rush's analysis tomorrow. Two sound bites:
  • Brian Williams: "Tuesday night massacre."
  • Hardball, Chris: ".. a little bit of fascism." A little bit of hyperbole. Even the Dems wanted Comey fired. 
The best thing about this news: it completely swamps the news of Obama giving a Climate Change speech.

This is so funny: even Chris Matthews is caught off guard. His guests include folks who are opposite in thinking to Chris Matthews. Wow, this is amazing. Chris Matthews and others are truly experiencing cognitive dissonance.

For Comey apologists: ten (10) reasons that Comey should have been fired long ago.

And Stephen Colbert's studio audience agreed:

POTUS Owned Comey!

From The New York Times:
Mr. Comey was addressing a group of F.B.I. employees in Los Angeles when a television in the background flashed the news that he had been fired.
In response, Mr. Comey laughed, saying he thought it was a fairly funny prank.
And then he quit laughing.
I guess that answers that question: Did Comey see it coming? Nope, he was so full of himself he didn't see it coming. 

You're Fired! Trump Fires Comey -- For The Archives -- May 9, 2017


May 11, 2017: once the media established the "alt-left" narrative a lot of folks who supported Trump's decision, changed their mind. Whatever. Rosie -- remember her -- classic battle between Rosie and Donald -- she tweeted some months ago: "Fire Comey." Trump re-tweeted Rosie's tweet -- suggesting that he and she finally agree on something. LOL. But now, she, too, changes her tune. LOL.

Original Post 

Most happy? Yup, you guessed it. Hillary.

News now coming in that both sides of the political spectrum are supportive. Feinstein supports the decision. The press seems to be confused by the timing. The timing is very straightforward.

Precedent: President Clinton fired William Sessions in the middle of his tenure. Perfectly legal.

Even Senator Schumer is perplexed how to handle this. Schumer is on record questioning Comey's handling of Clinton e-mail investigation; now Senator Schumer is suggesting that he never suggested that Comey be fired. A typical politician.

Later, about six hours after the firing: it's pretty much agreed by nine out of ten folks, Comey had to go. Now, the alt-left press is looking for reasons to support Comey, and, in all honesty, they (the press) look pretty silly. But by tomorrow morning, the narrative will have changed: Comey was the  victim. Notwithstanding his statement (under oath?) that Hillary Clinton forwarded 100's of thousands of classified e-mails to Huma (when, in fact, it was a handful). [And even that handful of classified e-mails was not enough for Comey to convene a grand jury. He was the investigator, prosecutor, defense attorney, judge, and jury on that one.]

Kula Sushi -- Cool -- May 9, 2017 -- Nothing About The Bakken

The granddaughters love this -- even the granddaughters that don't like sushi (two of the three).

I assume readers on the west coast and Japan are very familiar with this concept. I am very familiar with the concept, having first seen it when I first met m wife-to-be back in the early 1970's, but this restaurant has a "new" wrinkle -- or at least "new" to all of us out here in Texas.

Folks who enjoy sushi on the west coast are very familiar with the revolving conveyor belt that brings sushi selections right past your table (or the bar if that's where you are sitting). At your leisure you take the plate you want. You stack your plates, and the tally is based on the number of plates. In some restaurants, there are different colored plates designating different prices.

In this Kula restaurant, about 20 minutes from our home, the concept is the same: the revolving conveyor belt.

The "new" wrinkle: there is a second conveyor belt on an upper level that brings personalized orders. At your table, there is an iPad (a tablet) from which one selects one's choice. When one selects one's choice by tapping on the table, one's order is conveyed directly to your location, and it comes at "warp speed." That's a bit of hyperbole but compared to the lower conveyor belt, the upper conveyor belt moves much, much faster. But it can, because it is going as far as it needs to go to get to your location and then is stops right in front of you.

Interestingly, the personalized orders are priced the very same as the orders on the lower conveyor.

So, one sits there for as long as one want, interrupted only once by the hostess for one's drink order, and then one your own. Of course, the hostess can be summoned at any time.

In addition to all this, there's a "reward machine" at each table (not seen in this picture). After so many plates are taken off the conveyor belt, one receives a red plastic ball that opens up to reveal a cute little "cracker jack" gift which delights everyone at the table.

More Problems For Saudi -- Summer Will Soon Be Here -- May 9, 2017

... and when summer returns, Saudi Arabians use more of their oil -- yes, oil -- to generate electricity to run their air conditioners.

... and this year, the spike in electricity will likely come earlier: the Muslim fasting month of Ramadan starts sooner, beginning in late May. The traditional big evening meals with family and friends to break the fast tend to create a surge in power demand.

This means that if Saudi Arabia keeps to its word to cut production, then it means it has less oil for its export customers.

When Saudi Arabia announced cuts last fall (2016), they assured their Asian customers that Saudi Arabia would shield them from any production cuts.

But now, with a perfect storm gathering (summer, production cuts), Saudi Arabia has told its Asian customers that it will reduce oil supplies to Asia by about 235,000 bopd.

Of course, the Reuters article does not tell us how much oil Saudi Arabia historically provides Asia, so without the denominator this is not particularly helpful.

Except. 235,000 bopd x $50 / bbl = $12 million / day in lost revenue.

Speaking Of Disruptive Technology -- May 9, 2017

I'll be off the net for awhile -- going biking.

I will leave you with this: https://energyathaas.wordpress.com/2017/05/08/evidence-of-a-decline-in-electricity-use-by-u-s-households/.

EIA's Short Term Energy Outlook For May, 2017, Has Been Released

Oil Markets:
  • Increased drilling rig activity is expected to boost to U.S. crude oil production this year and next, with forecast production in 2018 averaging 10 million barrels per day.
  • Higher oil production from the United States, along with rising oil output from Canada and Brazil, is expected to curb upward pressure on global oil prices through the end of 2018.
Gasoline/Refined Products:
  • The recent decline in crude oil prices and rising gasoline inventories are cutting into pump prices, lowering the average price U.S. drivers are expected to pay for gasoline this summer.
  • U.S. gasoline inventories rose in April, a month when they normally fall.
  • Because of higher overall pump prices this year, the average U.S. household is expected to spend about $150 more for gasoline during 2017 than last year. However, gasoline expenditures are still expected to be lower than the average for the previous five years.
  • U.S. industrial production growth, rising rail traffic, and higher drilling rig activity are pushing up distillate fuel use.
Natural Gas:
  • U.S. marketed natural gas production is expected to increase almost 5% next year.
  • U.S. electricity generation is expected to be flat this year and then increase in 2018, with natural gas-fired generating facilities accounting for the biggest share of electricity supplies during both years.
  • U.S. coal production is expected to rise 5% this year and about 1% in 2018 on higher coal-fired electricity generation, which would be the first back-to-back annual increase in coal output since 2010-11.
  • The amount of U.S. wind power generation capacity is expected to top 100 gigawatts by the end of next year, when it would account for 9% of the electric power sector’s total generation capacity, and provide more than 6% of total electricity supplies.

Uber, Lyft As Disruptors -- May 9, 2017


June 5, 2017: Chicago taxi cabs nearing extinction due to Uber, Lyft.  

Original Post
The other day there was a report that DFW was $10 million short covering for new parking garages and refurbishing of parking garages. The reason: fewer people are driving to the airport and leaving their car parked there while on a short business trip. Folks are taking Uber instead, the report said.
The headline: DFW airport faces $10 million shortfall as Uber, Lyft hurt parking revenue. 
The daily rate is $24.
The airport had budgeted to collect $80.7 million in parking revenues for the first six months of the fiscal year, which ends Sept. 30. So far, the airport has collected $76.9 million.
To compensate for the lower revenues, Donohue said the airport has deferred some technology projects by six to nine months.
Now this from today's Wall Street Journal: Hertz shares plunge on wide earnings miss. Shares were off more than 20% midmorning before regaining ground.

Disclaimer: this is not an investment site.

These stories should suggest to investors that it would be a good idea to look at each of their individual holdings and think if there are any disruptive technologies out there that might invite a disaster. Closely connected with disruptive technologies is the old concept of "moats." For example, I learned from Warren Buffett that the railroads a) have relative geographic monopolies; and, b) have huge moats.

Fossil fuel pipelines (crude oil and natural gas) also fall into the category of entities with huge moats.

But back to the Hertz story. From the article, data points:
  • too many passenger cars, instead of the SUVs that customers want
  • lower resale values on passenger cars vs SUVs
  • the company cited increased spending as another reason for the poor performance
  • it was noted that the company felt an increased presence from activist Carl Icahn whose allies hold several board seats
  • wow: a net loss of $1.61/share compared with a net loss of 79 cents a share during the same period a year ago
  • EPS: a net loss of $1.61 vs 90 cents forecast -- wow!
It looks like much of their problem has to do with a flood of used vehicles coming off their leases, which reduced used-car prices:
Ms. Marinello on an investor call Tuesday blamed the poor quarter on Hertz’s optimistic views on its fleet, which resulted in the company buying too many cars to prepare for the summer selling season.
Now, the company has too many cars it can’t sell that are depreciating more than expected. Ms. Marinello expects Hertz will have an optimal mix of trucks and SUVs by the end of June.
By the way, this problem was noted on the blog a year or so ago. Some analyst noted that. I didn't buy into at the time; I was wrong. Fortunately I have / had no investments in car rental companies, at least not directly.

Nothing was mentioned in the article about Uber and Lyft, surprisingly. According to Jim Cramer on CNBC Hertz has consistently denied any concern with regard to Uber and Lyft.

How interesting to find this article in The Los Angeles Times, December 13, 2016: "Feeling the squeeze of Uber and Lyft, Herts looks to start-up Shift to sell its used cars." From the story, which is fascinating, by the way:
Rental car companies are looking for additional revenue opportunities as they find themselves squeezed by a major shift in how travelers get around. For many people, the affordability and convenience of Uber, Lyft and other ride-hailing apps have pushed rental cars aside. 
Ride-hailing services overtook rental cars among American professionals for the first time in the fourth quarter of last year, according to travel and expense management software firm Certify. 
Since July 1, Hertz’s stock has plummeted 48%, ending the day Monday at $22.73. In June, Hertz signed a deal to provide rentals to Uber and Lyft drivers who don’t have cars.
And more:

Yelp reported earnings today, after the market closed. And the shares in Yelp immediately plunged almost 30%:

Why?  I can think of a lot of reasons, but the "talking heads" suggest that Uber and Lyft are actually "taking over" in this arena. Yelp is a one-trick pony. Uber and Lyft have a stable of stallions, apparently.

Read more here: http://www.star-telegram.com/news/business/aviation/sky-talk-blog/article148659799.html#storylink=cpy

Update On Takeaway Capacity In The Marcellus / Utica -- May 9, 2017

Active rigs:

Active Rigs492884192183

RBN Energy: another update on the Marcellus / Utica gas pipeline takeaway projects.
For years now, limited natural gas pipeline takeaway capacity has constrained gas production growth in the Marcellus/Utica natural gas shale plays in the Northeast.
To fix that, a slew of pipeline projects were planned to relieve the constraints as regional supply began outstripping demand starting in 2014.
Now, the region is on the verge of being unconstrained for the first time since the Shale Revolution hit Appalachia. Many of those projects have come online since then, and another 19 expansions totaling 15.5 Bcf/d are planned for completion by late 2019.
If all goes as expected, this next round of projects should turn the Northeast market on its head again, as the capacity additions should start to outpace production growth. The problem, though, is that several projects have faced significant challenges in recent months, resulting in either cancellation or major delays.
At the same time, Marcellus/Utica production growth has slowed dramatically in the past 18 months or so. In today’s blog, “In a Northeast Minute…Everything Can Change — An Update of Marcellus/Utica Takeaway Projects,” Sheetal Nasta begins a series looking at the status of regional takeaway capacity expansions.
A Note To The Granddaughters

Two new books on the nightstand, the first being:
Something in the Blood: The Untold Story of Bram Stoker, The Man Who Wrote 'Dracula', by David J. Skal, c.2016. A review here.
I have always wanted to read a biography of Bram Stoker. Some/much (a key par) of Dracula was conceived at Whitby, northern Yorkshire, of which I have fond memories. I hiked the coast from coast from Robin Hood's Bay to Whitby one summer Saturday many years ago. It was an incredible trek. I spent the day in Whitby, awed by the Whitby Abbey, and then walked back on an inland road to Robin Hood's Bay where I left the car. According to Google Maps, the trek back was 5.5 miles and would have take almost two hours.

The coast route was incredibly challenging, walking on top of the cliffs, not on the beach.

The second book:
The Lost Landscape: A Writer's Coming of Age, Joyce Carol Oates, c. 2015.  
At one time I cared not for Joyce Carol Oates but that has all changed. It was an article in some newspaper some weeks ago that changed all my thoughts about this author. I don't remember the specifics. I have read very little of her work but what I have read, I have enjoyed. It should be interesting to read this memoir.

Another Note To The Granddaughters

Breakfast prepared for Sophia by her two older sisters this past Sunday:

The Market And Energy Page, T+109 -- May 9, 2017

Closing: Nasdaq hits another all-time high. Dow 30 was going to finish almost flat but then in the last 30 minutes dropped 70 points, only to close about 30 points down -- reportedly due to "alarm" over NOKO testing another nuclear weapon. WTI was down again today, closing right at $46.03, but I believe I saw WTI touch slightly below $46 about the time the market closed.

Opening: S&P 500 and Nasdaq hit new records; S&P now over 2400; big caps and tech pushing us up; energy lagging (badly). 

Futures: Dow 30 up about 38 points; WTI flat at about $46.50.

Whoohoo! SRE beats by 7 cents; 1Q17 EPS of $1.74. Revenue also beats: $3.03B (+15.6% -- wow -- y/y) beats by $160 million. SRE closed down 21 cents yesterday at $111.94; have to see where it goes today.

Permian's good news: from EIA today --
As crude oil production in the Permian Basin of western Texas and eastern New Mexico has increased, pipeline infrastructure has also increased to deliver this crude oil to demand centers on the U.S. Gulf Coast.
One indicator of a potential shortfall in available takeaway capacity in the Permian is a negative spread between the price of West Texas Intermediate (WTI) crude oil at Midland, Texas, and the price of WTI at Cushing, Oklahoma.
Going forward, the Midland versus Cushing discount, which recently widened to more than $1 per barrel (b), is unlikely to be either as large or as persistent as it was following the rapid increase in Permian production from 2010 to 2014. At points in both late 2012 and mid-2014, WTI-Midland was priced at least $15/b lower than WTI-Cushing.
Pipeline capacity expansions and other market changes are now underway to deliver more Permian crude oil to demand centers.
US GOM: new investment crucial to keep deepwater GOM production afloat

Hedge funds bail: just before OPEC-driven oil rally vanishes.

So sorry to hear this (LOL): PetroVietnam says Venezuela oil project still stalled.

Amazon unveils new Echo -- oh yeah. I'm getting one! And one for Sophia? We can talk to each other when we are in our own homes.

The Political Page, T+109 -- May 9, 2017 -- Flashback: President Obama Takes Golfing Trip To Ireland During The 2013 Sequestration

Lately the press has been giving the White House press secretary "grief" over the fact that President Trump is actually spending some weekends outside of Washington, DC. The press is accusing the president of wasting tax dollars. LOL.

From 2013, do folks remember the "sequestration?"

The budget sequestration in 2013 refers to the automatic spending cuts to United States federal government spending in particular categories of outlays that were initially set to begin on January 1, 2013, as an austerity fiscal policy as a result of Budget Control Act of 2011 (BCA), and were postponed by two month.
From a March 20, 2013, post on the blog:
One nice thing about the sequester: one quickly learns what is important to the administration. 
  • White House tours canceled. Presidential golf tours continue, even a golfing trip in Ireland.
  • Nuclear waste cleanup at Hanford, Washington: 200 laid off; 2,500 furloughed, leaving less than 8,000 full-time government workers/contractors to do something a lot of folks would think is important.
  • Congress won't allow USPS to stop Saturday mail delivery.