Wednesday, November 1, 2017

Venezuela Offers To Sell Refinery Assets To China, Russia -- The Energy And Market Page, Page 3, T+284 -- November 1, 2017

Venezuela offers refinery assets to China, Russia -- ArgusMedia:
Venezuela´s financially struggling state-owned oil company PdV is offering to transfer control of its largest domestic refining complex to oil companies from Russia and China, the Opec country´s largest state creditors.
The joint venture proposal centers on PdV´s 940,000 b/d CRP complex, once one of the world´s largest and most modern refinery systems. The CRP, located on the Paraguaná Peninsula, consists of the 635,000 b/d Amuay refinery and the 305,000 b/d Cardón refinery, which together are currently processing a third of their combined nameplate capacity, according to a week-old PdV internal report seen by Argus.
Amuay throughput is about 200,000 b/d or 31.4pc of its design capacity, and Cardón is running 110,000 b/d or 36pc of nameplate capacity, the report shows. Faced with dwindling cash flow and mounting arrears on its dollar-denominated debt, PdV appears to be trying to mortgage assets to stay afloat.
How the iPhone X could steal Christmas: story at WSJ. The writer(s) suggest that local retail, brick-and-mortar could have a bad, bad Christmas for three reasons:
  • Apple's iPhone X
  • higher gasoline prices
  • Amazon
It should be noted that:
  • iPhone X: for those with money; upper middle class; the rich
  • higher gasoline prices: lower middle class
  • Amazon: lower and upper middle class
Amazon will do just fine. Apple will do just fine.

Too Big To Fail? NOG Announces New $400 Million First Lient Credit Facility -- November 1, 2017

From a company press release:
Northern Oil and Gas, Inc. (NYSE American: NOG) today announced it has closed an agreement with TPG Sixth Street Partners for a new $400 million first lien credit facility.  
At the closing, an initial amount of $300 million was funded - an additional $100 million of delayed draw term loans are available to the Company, subject to the satisfaction of customary conditions.  The new credit facility matures in five years and carries a floating interest rate of LIBOR, plus 7.75%.
The Company used approximately $161 million of the initial proceeds to repay and retire its bank credit facility led by Royal Bank of Canada, which was scheduled to mature in September 2018.  
Excess proceeds under the initial draw and additional availability under the new credit facility may be used for general corporate purposes, including, but not limited to, development of the Company's assets in the Williston Basin, future accretive acquisitions, and potential purchases of the Company's outstanding unsecured senior notes and common shares.

Not Much New In Daily Activity Report -- November 1, 2017

Active rigs:

Active Rigs533470193180

One new permit:
  • Operator: Kraken Operating
    Field: Lone Tree Lake (Williams)
  • Commentator:
Four SM Energy wells transferred to Kraken Operating:
  • four Redfield wells in Williams County (permits number 19133, 19787, 21781, and 23142)

Blogging Is Significantly Delayed! -- Please Bear With Me -- November 1, 2017

Those with a paid subscription will have their subscriptions extended for one month because of my delay in blogging. Just too much stuff happening too fast. Comments will be delayed. But I'm here and will gradually catch up.

Oh-Oh. More Than Just A Miss On Earnings -- Look At The Huge Drop-Off In Model S/X Sales -- November 1, 2017

This page will not be updated; Tesla Model 3 ramp-up is tracked elsewhere. 

Tesla ramp-up for Model 3 is tracked here.

EV numbers for October, 2017. It will take a few days for all makes/models to be reported, but as it stands now:

The Energy And Market Page, Page 2, T+284 -- November 1, 2017 -- 38 Weeks To Re-Balance; Gasoline Production Has Increased

Ford: October sales sail past estimates --
  • unit sales: up 6.2% vs 3.9% estimate
  • Truck sales up, +11.4%
  • SUV sales up, +5.3%
  • passenger car sales down, -2.4%
  • EVs sales: not mentioned
GM, Fiat Chrysler post declines.

Weekly Petroleum Report

US crude oil inventories decreased by 2.4 million bbls from the previous week, from the weekly petroleum report . Now at 454.9 million bbls. I will wort this out later.

Weeks to RB
Week 0
Apr 26, 2017

Week 1
May 3, 2017
Week 2
May 10, 2017
Week 3
May 17, 2017
Week 4
May 24, 2017
Week 5
May 31, 2017
Week 6
June 7, 2017
Week 7
June 14, 2017
Week 8
June 21, 2017
Week 9
June 28, 2017
Week 10
July 6, 2017
Week 11
July 12, 2017
Week 12
July 19, 2017
Week 13
July 26, 2017
Week 14
August 2, 2017
Week 15
August 9, 2017
Week 16
August 16, 2017
Week 17
August 23, 2017
Week 18
August 30, 2017
Week 19
September 7, 2017
Week 20
September 13, 2017
Week 21
September 20, 2017
Week 22
September 27, 2017
Week 23
October 4, 2017
Week 24
October 12, 2017
Week 25
October 18, 2017
Week 26
October 25, 2017
Week 27
November 1, 2017

Other data points from the most recent weekly petroleum report:
  • refinery utilization still below 90% (at 88%); and, not only that, but 10,000 b/d less than the previous week's average
  • gasoline production increased; now averaging 10.2 million b/d
  • distillate fuel production also increased; now averaging over 5.0 million b/d
  • gasoline production supplied average over 9.3 million b/d, up by almost 3% from the same period last year
  • we will see the graph for gasoline demand tomorrow

The Energy And Market Page, T+284 -- November 1, 2017


Later, 8:54 a.m. Central Time: I'm not paying attention, so I could be wrong on this, but I think all three major indices are trading at new highs. Apparently it's a global rally. Some overseas markets are trading at 20-year highs. One has to ask: what was President Obama doing for eight years? The good news: a lot of folks continued accumulating shares of publicly traded companies at cheap prices during the Obama years? Lots of explanations for what's going on, but looking ahead, a lot of folks are looking ahead two months, eager to add to their IRAs as soon as the new year allows them.

Original Post
Flight risk: some sources suggest Manafort is a flight risk. If so, why did he not take a long European vacation some months ago. Apparently he was not paying attention.

Party time: smart, smart move by Walmart. In-store Christmas parties. Walmart will call them "holiday parties," to remain politically correct, but Fortune actually referenced "Christmas" and even put "Christmas" in the headline, something we probably would not have seen under the previous administration.

Dow futures: what changed between yesterday and Monday? Nothing. Except mutual funds were selling their winners, re-balancing their portfolios on Monday and Tuesday. Now, that their winners are a bit lower, they are buying back in and the stock markets are surging in pre-market trading. Of course, this could all change once President Trump starts tweeting. The good news: former president Obama has no speeches scheduled today. I remember all the days during the previous eight years when the market was surging in early trading, an then President Obama made a speech reminding us how awful the country was. Just saying. My worldview. Probably wrong.

Dodgers take World Series to final game tonight. Great game last night.

WTI: breakout of $55 will confirm $60 midterm -- Minyanville

LNG export terminal projects -- update in one graph:

The Christmas Gift Page

Ink & Paint: The Women of WAlt Disney's Animation
Mindy Johnson
c. 2017

Great, great gift idea for folks with an interest in this sort of thing. This is a huge coffee-table book; beautiful, beautiful photographs. Great bios of the women who brought us so many memories -- those of us who grew up watching "The Wonderful World of Disney" many decades ago.

WTI Over $55 In Pre-Market Trading -- November 1, 2017

Active rigs:

Active Rigs533470193180

RBN Energy: the rejuvenation of natural gas processing economics.
Not long after crude oil prices crashed in 2014, natural gas processing economics hit the skids. From late 2014 through the first half of 2017, times were tough for natural gas processors and the producers processing natural gas to extract NGLs in their plants.
That’s because the per-MMBtu price difference between natural gas prices and NGL prices was low. Very low. In fact, during 2015-16, it was the lowest it’s been over the past decade except for a brief period during the 2009 financial meltdown.
But things are looking up. Thanks to a big boost in from propane and butane prices — and, to a lesser extent, rising ethane and natural gasoline prices — natural gas processing economics look healthier today than they have in years. It is going to get even better as more new ethane-only steam crackers come online.
Given these developments, it is clearly time for another deep dive into what makes gas processing economics work, and how the numbers are about to change. Today, we begin our latest expedition into the wilds of gas processing. 
The Katie Ledecky Page

Meandering -- Nothing About The Bakken

Like the Bakken, I suppose, "social media" never ceases to amaze me. "Walk Away Renee" is "featured" in Three Billboards Outside Ebbing, Missouri. The song struck a chord among many, including the individual who wrote this:
For all the boomers babbling about how "u kids don know dis feel," f*** you. I remember being just a tiny boy in the 90s, riding in the back of my dad's '78 Mercury, listening to the oldies station. I miss that car. I miss my dad the way he was. I miss myself. This song is so much more than some breakup melody. Those violin stings touch me somewhere deep, it's as if this song was about the sorrowful passage of time, and how everything must leave us eventually like some scorned lover. You're not to blame.
Walk Away Renee, The Left Banke

Released in 1996, I would have been about fifteen years old. I never realized then Renee was such an "important" song; it was simply one of my favorite songs at the time (and remains so today). It's very likely I first heard this song in "The Hut" on Main Street just across the street from Central School in Williston. Hard to say.

Happy Halloween

My dad is about 95 years old, give or take a few years. He is in great physical shape and his mind is as sharp as ever for the things that are important in life. One of the things I most appreciate about him is his use of the "walker." He's used it for many, many years and my hunch is that when he first started using it, he really didn't need it but he knew the seriousness of a broken hip and felt that using a walker early on might prevent a fatal fall.

His goal: to live long enough to watch AAPL split 7 - 1 (again). Knowing Dad and knowing Apple, he may reach that goal.

The Political Page, T+284, November 1, 2017 -- New York Politicians Go Out On Limb Suggesting Most Recent Event Was An Act Of Terror

From a editorial:
Yet, New York Mayor Bill de Blasio came right out and said it: “This was an act of terror.”
That was already apparent to the New York City police, whom de Blasio has repeatedly insulted as racists, and demeaned for quickly confronting the dangers of criminal behavior.
That’s the same de Blasio who pompously defied Trump’s call to dismantle so-called sanctuary cities, making it tougher for authorities to find and corral criminals.
“Don’t let the terrorists change our life in any shape, manner or form,” said Gov. Andrew Cuomo, just two hours after the attack took place.
That’s right, New Yorkers. Listen to your governor. Don’t take any extra precautions in how you live your lives. Don’t admit that there are evil people in the world who want to kill you, then exhort God’s greatness. Don’t use that ugly word -- war – to describe our conflict with radical Islam. Don’t offend.
And don’t defend. It might upset someone.
What surprised me was how quickly "everyone" called this an "act of terror." Under the previous administration there was a push to end any talk of "terrorist attacks" in this country, and a push to "hold judgment" after any attack, no matter how obvious.

By the way, the "person of interest"  behind the deadly New York City attack had pledged loyalty to the jihadist army.

Surprise, surprise.

Holy Guacamole, Batman, What Just Happened? -- Dow Futures Spike; WTI Over $55 -- November 1, 2017

From CNN Money: