Connecting Bakken Crude Oil With Nation's Largest Port And Export To Asia -- July 24, 2017

Updates

February 13, 2018: US supertanker terminal set to export oil for the first time.

February 13, 2018: LOOP testing begins for bidirectional crude oil flows (loading/unloading) for supertankers in the GoM for export.
 

Original Post

 

Don sent me the link to this story. He wanted to point out that one VLCC can carry 2 million bbls of oil, or the equivalent of two days of North Dakota crude oil production.

I replied that this story is such a great story on so many levels, but for me, personally, it's almost a personal story.

Had it not been for the blog, I probably wouldn't have thought much more about the story than what the writers write.

The story is about LOOP, America's biggest oil port. I only know about it because of RBN Energy. I've blogged often on LOOP.

The post at this link is perhaps one of my favorite posts and it just happens to reference LOOP without mentioning it by name. The caption for the photograph at the linked story fails to mention:

• that the ship was a VLCC -- a very large crude carrier
• that the Louisiana port had to have been LOOP

There are also a couple of other data points not mentioned. More on that later. For now, back to the linked Bloomberg story. Data points:

• LOOP: Lousiana Offshore Oil Port
• the only terminal along the US Gulf Coast able to handle a fully laden VLCC
• currently, an import-only port for VLCC's
• considering become an export port also as early as next year

From the linked story:

Currently, shippers have to load oil onto smaller tankers in ports such as Houston or Corpus Christi, Texas, that then transfer their cargoes onto Very Large Crude Carriers sitting offshore. That adds cost and time to the shipments. While Corpus Christi received its first VLCC at the end of May, the port’s channel isn’t deep enough for a ship that size to load a full cargo.

All previously posted at the blog.

Earlier I mentioned that the linked Bloomberg article was remiss in not mentioning two other points:

• all of this only works for the simple fact that it just turns out that the Panama Canal, recently expanded, is now able to handle VLCCs; and,
• although the law was changed under President Obama to allow oil exports once again, I can only assume exports are going a whole more smoothly under the current president than things would be going under President Obama.

I could be wrong on that last note, but I doubt it. I'll leave it at that.

Oh, I almost forgot. The St James Hub in Louisiana is an important terminal for Bakken oil arriving by CBR. From St James, oil is then taken by pipeline to LOOP.

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Richard Burton

I am ambivalent about Richard Burton. I assume it has something to do with his off-camera life, his personal life. Whatever.

My "feelings" about Richard Burton have changed completely -- I'm watching The Night of the Iguana on TCM -- and Burton is simply a hoot. When Johnny Depp is at his best, it seems Depp is channeling Richard Burton in Iguana.

Interestingly, this is what one reviewer had to say about Burton in this movie (from wiki):

[Burton] was spectacularly gross, a figure of wild disarrangement, but without a shred of real sincerity. You see a pot-bellied scarecrow flapping erratically. And in his ridiculous early fumbling with the Lolitaish Sue Lyon (whose acting is painfully awkward), he is farcical when he isn't grotesque.

I can't speak to Sue Lyon's performance but I think the critic completely misread Burton's performance.  The very same thing happened in the first installment of The Pirates with the lead role played by Depp.

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Who's Gonna Fill Their Shoes?

George Jones

EU Coming After German Automobile Companies -- July 24, 2017

Pretty funny. Is the EU eating its own? Appears so. Maybe it's time for Germany to leave the EU. LOL. If not, maybe VW and Daimler Benz need to move to the US. Just saying.

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Just A Little Humor

I guess this should end all that talk about Walmart and Amazon leaving all other retailers in the dust. Business Insider tells us that Target is leaving Walmart and Amazon in the dust when it come to e-commerce. LOL. Note the date of the article: about 18 months ago. One year ago TGT shares were selling for $76; today, TGT closed at $54.05.

Stuff happens as they say. 

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Poll

I normally keep poll questions related to energy or the Bakken. But I haven't done a poll in so long, I was worried I would forget how to post a poll. So, quick and fast, a political poll in which we ask whether one thinks Jeff Sessions will still be the US Attorney General on September 1,2017.

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Southern California Vacation

Huntington Beach. Ruby's.

Authentic 1950s milkshake.

What's not to love?

Based on other photos, Sophia was absolutely enthralled with these milkshakes. And this is why Texans love California. Ruby's. The Pier. The Ocean. Huntington Beach. LOL.

Anadarko? One Of The Energy Darlings Of Wall Street? Permian More Expensive That Thought? -- July 24, 2017

It's been my impression that Anadarko has been one of the energy darlings of Wall Street. Then this:

• 1Q17, ending March 31: bigger-than-expected loss as costs rise. Posted by Reuters, May 2, 2017.
• 2Q17, ending June 31: bigger-than-expected loss. Posted by MarketWatch, July 24, 2017.
• Anadarko cuts 2017 spending by $300 million. Posted by Oil & Gas Journal, July 24, 2017. Data points from the O&GJ:

• will lower its full-year sales-volume guidance by 4 million boe to 235 million boe
• follows recent divestiture and the impact of shutting more than 3,000 wells in the DJ basin in Colorado after a home explosion in April, 2017
• closed on its Eaglebine assets in central Texas for $534 million
• closed on its sale of coalbed methane assets in Utah for $70 million

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or what you think you may have read here.

Other Anadarko posts:

• Anadarko expanded in Gulf of Mexico, September 12, 2016
• stuff happens, May 3, 2017
  
• Feds approve Anadarko plans to drill coalbed methane in Utah, May 8, 2012

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IRRs As Reported By Operators

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OSP = Official Selling Price (Saudi)
ICE = Intercontinental Exchange (Europe)

I'm only posting this for my benefit. I can never remember this stuff; maybe this will help:

Arab Medium (which is pretty heavy) and Arab Heavy vs ICE Brent.

Meager Daily Activity Report -- Only Two Permits Renewed -- July 24, 2017

Active rigs:

$46.47	7/24/2017	07/24/2016	07/24/2015	07/24/2014	07/24/2012
Active Rigs	58	32	73	193	208

Only two permits renewed:

• BR (2): two Patton permits, Dunn County

And, that was it for today's daily activity report except the wells that were released from the confidential list, and those results were posted earlier.

OPEC Is In Deep Doo-Doo: UAE Oil Giant To Seek Loan -- Reuters -- July 24, 2017

We've talked about this at length: the situation OPEC is in. Now more news to validate their sad state of affairs. From Reuters, UAE oil giant in talks to obtain loan of up to $5 billion. Data points:

• Abu Dhabi oil giant: Adnoc
• seeking a $5 billion loan
• "a sign that the region's giant oil companies are increasingly turning to the debt markets to fund expansion" (or to simply survive?)
• also, in the alternative, considering a $3 billion bond issue
• would be the first large bank borrowing since Adnoc's first bond deal last year; with Japanese banks, for $3.3 billion
• reminder: in April --three months ago -- Saudi Aramco raised $3 billion through Islamic bonds
• Oman: working on a pre-export financing loan of around $1 billion after closing a $2 billion loan package a few weeks ago
• Adnoc's CEO has been in place less than a year (similar to length of time for Prince Salman)

The Political Page, T+185 -- July 24, 2017

The headline story over at The New York Daily News: NYC won't fund MTA ("the subway") until it's determined that cash is being used efficiently.

This is fascinating. So far, as blogged yesterday, I've only read a few chapters of Supreme City, a biography of NYC, starting with one of the city's most fascinating mayors: Jimmy Walker, all the way back to the 1920s and the Jazz Age. It is amazing how similar the two stories are: the subway issues of the 1920's and the issues in 2017. Even back in 1926, there was a state vs city fight on such issues. We are seeing it again -- the fight between Albany (governor, state legislature) and the city (mayor, the unions).

The Literature Page, Sort Of -- Nothing About The Bakken -- July 24, 2017

I'm sorry if I ruined anyone's day by posting again with nothing about the Bakken. If you came here looking for updates on the Bakken, scroll down or scroll to the sidebar at the right.

It's been ages since I've been out on my bike for any meaningful ride. First, I was out of town for awhile, and then when I came back it took awhile to get used to the heat here in north Texas. I used that as an excuse not to ride. But today, with absolutely no family commitments, I finally went out to ride.

I got a late start and it will be ferociously hot when I start back home. But I will cool off in the pool.

My first stop was the library to catch up on The New Yorker. As most folks know, I canceled my subscription when it was clear that The New Yorker suffered from Trump Derangement Syndrome and / or inexplicably had decided to go whole hog on writing for the "Cult of Hillary." From November 8, 2016, to late May,2017, it seemed to get worse and worse. A recent issue seemed to have moved into new territory: except for the requisite "Talk of the Town" opening that always slams Trump, the rest of the magazine was pretty much without the president.

So, now the most recent four issues that I am now catching up on. In general, I am impressed. There were several articles that were actually back up to the quality of what I expect from The New Yorker. I would like to think a lot of New York City subscribers let the editor know it was time to move on. But I would be hoping for too much.

LOL. I spoke too soon. I just picked up the most recent issue (someone else had been reading it while I read the earlier issues that I had not yet read). The cover is a caricature of President Trump dragging his son Jared by the ear off Air Force One while kicking his son-in-law who is coming down the steps ahead of The Donald. So, The New Yorker simply can't get past Trump; he's "in their head" as they say; they continue to show signs and symptoms of TDS.

So, what have I learned, what must I come back to? I have only read a little of each of the articles mentioned below; I will read them in full later.

The 60s: The Story of a Decade; the anthology of New Yorker stories from the 1960s. It is now out in hardcover. I have a soft cover pre-publication issue that was sent to me for free if I reviewed it for Amazon. I'll probably buy the hardcover published edition some time.

"Power Brokers: Africa's Solar Boom Is Changing Life Beyond the Grid" in the June 26, 2017, issue. This is exactly where solar energy might work. Having said that, when in remote Africa with the USAF some years ago, diesel generators did a great job providing uninterrupted, dependable, and very inexpensive electricity, 24/7. But solar still fills a niche where human resources are such that there is no one around to maintain the diesel generators. A 10-page article.

Retrospective. A short essay on "Thunderbolt and Lightfoot," a Clint Eastwood movie, 1973. The essay mentions Edgar Wright who directed "Baby Driver" now in general release, and getting good reviews, apparently. Edgar Wright is better known for "Shaun of the Dead," a real classic and one I love. My wife does not.

"Feeding The Beast: David Pecker's Reign at the National Enquirer and the Rise of Trump," by Jeffrey Toobin. This is worth going through all the back issues of The New Yorker. Anyone familiar with The National Enquirer should not be surprised by the premise of this article. The caption at the opening photograph suggests the publisher, David Pecker, may be interested in buying Time. Wow. Ten pages devoted to the story.

"Undermined: A Local Activist Fights for the Future of Coal Country," by Eliza Griswold. I'm not sure what the article is all about but it looks very, very interesting. Again, ten pages devoted to the story.

Not at all interested in this -- I thought -- and then I read this: a book review of yet another biography of Ernest Hemingway. I was aware of the new biography, "Hemingway" (Knopf) by Mary V. Dearborn. We'll see.

A review of "Baby Driver."

Shakespeare. This one is going to be very, very good. "If You Prick Us: What Shakespeare Taught Me About Fear, Loathing, and the Literary Imagination" by Stephen Greenblatt. I am so glad I know who the real Shakespeare is (previously posted; Sir Henry Neville); this article discusses again, the Venice ghetto (Ghetto Vecchio). Fascinating. Six pages devoted to the story.

"The Future Is Texas: The State Is Increasingly Diverse, But Right-Wing Zealots Are Taking Over," by Lawrence Wright. Again, should be fascinating to see how the New York alt-left zealots see Austin. Amazing: twenty-three (23) pages devoted to this story. It must have really gotten the attention of the editors.

"Follow The Leader: How Residents of a Rural Area Started Copying the President, by Peter Hessler, in a "letter from Colorado." Seven pages.

"Hat Trick: How George Strait Became The Most Reliable Star In Music," by Kelefa Sanneh. Her short bio simply says Sanneh has been a staff writer for The New Yorker since 2008. It will be interesting to see if she seems to know anything about country music. It sounds like she actually visited San Antonio to get the story. It must have been culture shock for her. [Later, I did read this article the next day. It is very, very good and highly recommended for country music buffs. It's the kind of writing one might have found in Rolling Stone in its heyday. I learned a new term: stacked blue jeans. That's when wearing blue jeans long enough that they bunch up when standing up; the purpose is that when on a horse, they cover as much of the boot as possible. So, "stacked blue jeans."]
Paradise Lost, by David S Brown, another biography of F Scott Fitzgerald. How many do we need?

En Plein Air, southern California, July 24, 2016

Age 3 and a few days

Intermittent Energy -- Winners: Commercial Users; Losers: Residential Customers -- July 24, 2017

Updates

July 25, 2017: update from EIA today. 

Original Post 

This is how intermittent, non-dispatchable solar energy is affecting California electric rates:

Big users of daytime electricity are government offices, businesses, manufacturing plants: they tap into the electricity grid when rates are lowest.

Big users of electricity early in the morning (6:00 a.m. to 9:00 a.m.) and in the evening (5:00 p.m. to 10:00 p.m.) are residential users.  I would wager that 80% of a home's electricity use comes in those eight hours each day.

And look how much worse it is getting as the mandates take effect: compare the spread in 2017  vs the spread in 2016.

Even worse, the only real benefit of solar energy (and it would still be more expensive than coal) is between the hours of 10:00 a.m. and 4:00 p.m. -- only 6 hours in a 24-hour period, or 1/4th of the total day.

This is not rocket science.

By the way, they used to refer to this evening spike in prices, the "California duck curve." Time to start calling it what it is: "Twin Peaks." And a high price to pay to "feel good."

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A selfie from southern California

July 24, 2017

The Political Page, T+185 -- July 24, 2017

The new White House communications director's theme song:

Scary, much? Yes, I would say so. LOL.

The Energy And Market Page, T+185 -- July 24, 2017

Updates

July 25, 2017: update on "today's joke": oil rises 1% after Saudi "vows" to cap crude exports next month. Russia continues to support cuts; OPEC putting pressure on Nigeria.

Original Post

Today's joke: this came via a John Kemp tweet -- OPEC and non-OPEC promise to try harder to reduce exports and cut excess global inventories (wink, wink). 

Halliburton beats forecasts; 23 cents vs 19 cents forecast.

Payday! KKR to pay $66.50 / share for WebMD; $2.8 billion deal.

Mission Impossible: OPEC's goal to "sustain" oil prices -- whatever that means.

Reality sucks: it's still incredibly hard to build an EV startup -- "green energy site." I only read the opening line and the first thought that came to mind: Tesla sucked all the venture capital out of the EV sector. No wonder it's "incredibly hard" to build an EV startup.

Even China has a gasoline, diesel problem (too much): China announces surge in gasoline, diesel exports to ease domestic glut.

The Rock teams with Apple's Siri -- FBN.

Mike Filloon: anticipating today's OPEC meeting.  Interests me not.

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on what you read here or what you think you might have read here.

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The Sports Page

Did anyone even watch the final stage of the bicycle race in France?

The Jordan Spieth highlights winning The Open were simply incredible -- the birdies and the eagle on the last five holes. The Wall Street Journal view.

And, of course,  the NASCAR race at Indianapolis -- all six hours of it -- was the frosting on the cake, won by Kasey Kahne, taking on Keselowski ("Pat, I'd like to buy a 'k'.") mano a mano and winning. The big race: to beat the setting sun -- Indianapolis has no lights; cannot race at night.

LA Times On Warren Buffett's Energy Powerhouse -- No Concerns With Monopolies Or "Too Big To Fail" -- July 24, 2017

Headline story over at The Los Angeles Times: Buffett's Berkshir Hathaway amasses a Western energy force. From California to the Midwest, billionaire investor Warren Buffett is steadily building an energy powerhouse.

Buffett’s Berkshire Hathaway Energy subsidiary has gobbled up utilities and natural gas pipelines and tapped into clean energy production, including from Southern California’s abundant geothermal resources.

The latest move by Berkshire Hathaway Energy is the planned $9-billion purchase of Dallas-based Oncor, a regulated electricity service provider with 10 million customers and more than 3,700 employees. It’s one of the nation’s largest power transmission companies.

“Oncor is an excellent fit for Berkshire Hathaway, and we are pleased to make another long-term investment in Texas,” Buffett said in a statement announcing the deal, which is expected to close by the end of the year. ”When we invest in Texas, we invest big!”

Much, much information. With regard to natural gas and wind energy, it looks like Buffett is actually doing what T Boone Pickens advocated but was never able to put together -- mostly due to too many federal regulations and CAVE dwellers. Buffett took a different route: he let others do the "heavy work." Once that was done, he bought what they made. I suppose one could honestly say that Berkshire "did not build that" (perhaps in one case the former president was correct -- LOL).

By the way, an update on Pickens here.

And back to the Berkshire story, three graphics:

Update On Southeast Power Market Pipeline Project -- RBN Energy - July 24, 2017

Active rigs:

$46.21	7/24/2017	07/24/2016	07/24/2015	07/24/2014	07/24/2012
Active Rigs	58	32	73	193	208

RBN Energy: update of the Southeast Power Market pipeline project.

For the first time in more than a decade, Florida — the second-largest natural gas demand market for electric generation in the U.S. (after Texas) — now has a new gas supply route into the state.

Last month, Enbridge’s Sabal Trail Transmission pipeline began partial service, increasing Florida’s inbound gas transportation capacity by 1.1 Bcf/d (26%) — just in time to help meet air conditioning demand during the hottest months of the summer.

The pipeline ultimately will for the first time connect Marcellus/Utica shale gas to the Sunshine State’s voracious power market. In the month or so since it began service, the pipe has already ramped up to 0.4 Bcf/d and, in conjunction with additional upstream expansions, could ultimately change not only how Florida gets its gas but where that gas gets sourced. Today, we provide an update on Sabal Trail and its effect thus far on gas flows.