Week 44: October 29, 2017 -- November 4, 2017

WTI closed out the week at $55.70. Folks talk a lot about all the plays in the US, but basically the plays in the US come down to the Permian and the Bakken.

This was a terrible week for Tesla and TSLA. Here. Tesla watch here.

Venezuela, one step closer to bankruptcy. Saudi Arabia continues to hemorrhage cash. Saudi will need $70-oil to balance federal budget in 2018. Good luck.

The economy continues to get better and better by any objective measurement -- and yet the mainstream media has trouble dealing with it. Perhaps one of the best indicators of the growing economy was this: American orders for trucks soar.

This week, it was reported that the unemployment rate in the US was the lowest since 2000. Lynn Helms suggests there are seventeen (17) unconventional resource targets in the Williston Basin. Not two, not three, not four ... but seventeen.

Meanwhile in the Bakken:

Operations:
Active rigs dropped to 51 early in the week but by the end of the week had recovered to 55
CLR well has jump in production without explanation

Fracking
QEP talks about re-fracking in earnings call
Whiting reports the results of a thrice-fracked Koala well in Poe oil field 

Nine New Permits; Sixteen Permits Renewed; WTI Flirting With $56 -- November 3, 2017

Active rigs:

$55.70↑	11/3/2017	11/03/2016	11/03/2015	11/03/2014	11/03/2013
Active Rigs	55	36	69	186	18

Nine new permits:

• Operators: Oasis (6): WPX (3)
• Fields: Banks (McKenzie); Mandaree (Dunn)
• Comments: Oasis has six permits for an Aagvik/Nelson 6-well pad in SESW 23-152-98 (see below); and, WPX has permits for a three-well Otter Woman pad in section 5-148-93;

Well coming off confidential list:

• 33249, 1,748, Hess, AN-Gudbranson-LW-153-94-2215H-1, 

Sixteen permits renewed:

• EOG (7): seven Hawkeye permits, all in McKenzie County 
• Newfield (5): five Bice permits, all in Dunn County
• MRO (2): a Levi USA permit and Kottke USA permit, both in Dunn County
• Resource Energy (2): a Curly permit and a Kenyon permit, both in Divide County

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Oasis: Proposed 6-Well Aagvik/Nelson Pad

Out And About For Awhile -- Good Luck To All

I apologize for the few stories on the Bakken. It's relatively quiet. I hope to have a great flashback posted over the weekend, but for now, taking a short break.

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Lookout Pass

On the way to Flathead Lake --

The Market And Energy Page, T+286 -- November 3, 2017

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The Markets

The three major indices all set new record highs today. Whoo-hoo.

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WTI

Two bits, four bits, six bits, a dollar; all for WTI, stand up and holler! WTI closes up over 1%, now about $55.69.

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Apple

Updates

November 4, 2017: first impressions of the Apple iPhone X -- very, very impressive. In addition to that linked review, that was the unanimous report from the field yesterday on television -- everyone interviewed who had bought the iPhone X were blown away how good it was -- especially the screen. The quality of the screen kept coming up as the best feature.

Original Post

 

Yesterday it seemed to me that CNBC was caught off-guard when Apple, Inc, earnings were announced. This morning: completely different. At the 11:00 a.m. Central Time hour, it's practically a love fest. The "#1 analyst" for Apple raised price target to $195.

Disclaimer: do not make any investment, financial, travel, job, or relationship decisions based on what you read here or what you thought you may have read here. Any non-Apple stuff posted on the blog is to help me put the Bakken in perspective and to give me a bit of relief from the oil and gas posts.

Lines to buy the iPhone X: no photos, unfortunately, but there was a very long long stretching around the block in front of the Apple Store in Southlake, TX, today. That was about 10:00 a.m. When we drove by again at 2:00 p.m. the line had gotten longer. Two law enforcement squad cars were parked in front, along with at least two uniformed police officers. From WSJ, Apple store lines return.

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Others

Pandora: shares plunging. One word: Apple. 

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EVs

The full EV October sales scorecard is now complete.

What caught my eye (some of this has previously been discussed):

• total sales: October sales are generally less than September sales, but compared to the previous year, look how far sales dropped month-over-month (October-over-September)
• Tesla: sales of Models S and X fell off a cliff
• Tesla: deliveries of Model 3 even worse than imagined
• Chevy Bolt outsold all of Tesla (previously discussed -- this is a huge story)
• holding steady: Toyota Prius; Nissan LEAF; Ford models; BMW; Chrysler Pacifica;
• moving up: BMW (in general)
• slipping: Volvo; Porsche; Mercedes (perhaps the steepest drop outside of Tesla)
• museum pieces: Porsche Panamera 5-E

The Political Page, T+286 -- November 3, 2017

To coincide with Donna Brazile's new book on the DNC and how the DNC was co-opted by Hillary Clinton, it appears the Scientific American has a cover story on a related issue:

A Few Of My Favorite Things -- November 3, 2017

CBS to revive "Twilight Zone" series (link here):

Another environmental disaster averted:

Trump continues to build his legacy:

Lowest Unemployment Rate Since December, 2000 -- Making America Great Again -- November 3, 2017; Record Number Of Americans Not In Labor Force

What was President Obama doing for eight years? In less than a year after President Trump takes office, the unemployment rate is the lowest in almost two decades.

The U.S. economy added 261,000 jobs in October while the unemployment rate fell again to 4.1%, according to the latest figures from the Bureau of Labor Statistics.
This is the lowest unemployment rate since December 2000.

Wall Street was looking for a big bounce back for the labor market in October after the Hurricane-impacted figures we saw in September. September’s numbers were also revised up to show gains of 18,000 after having been previously estimated to decline by 33,000.

Economists were looking for job gains of 313,000 in October with the unemployment rate set to hold at 4.2%, according to estimates from Bloomberg.

With regard to the employment numbers today, from The New York Times:

The October report was more mixed.

The unemployment rate fell further, to 4.1 percent. The labor force, however, fell by 765,000. The labor force is fighting against a strong demographic headwind: the retirement of the baby boom generation. The participation rate — the share of adults who are either working or actively looking for work — is near multi-decade lows, largely because of the aging population.

In recent months, however, the participation rate had begun to edge back up, as the strong job market drew idle workers off the sidelines. Mr. Ryan said Friday’s report suggested that there simply aren’t many workers left to attract. 

Tell me again "there simply aren't many workers left to attract." This headline from CNS:

95,385,000: Record Number Not in Labor Force; Participation Rate Falls to 62.7%

Labor participation rate falls to less than 63% and there are a record number of Americans NOT in labor force.

The self-ordering kiosks in McDonald's and other fast food restaurants will free up millions of folks still willing to work.

The Permian On Track To Produce 4 Million BOPD Within Five Years -- November 3, 2017

LOWEST unemployment rate since December, 2000. 

Venezuela, tick, tick, tick: the government admits it can no longer pay its bills. I do believe that is the definition of default. Note the date: November 2, 2017 -- the date that headline was posted. No links. Story everywhere. Okay, here's a link. Also here.

Venezuelan President Nicolas Maduro finally admitted his government can't afford to pay all of its mounting bills.

Maduro said in a televised speech Thursday that Venezuela and its state-run oil company, PDVSA, will seek to restructure their debt payments.

The oil company made a $1.1 billion payment on Thursday, he said, a sizable amount for a country with only $10 billion left in the bank. "But after this payment, starting today, I decree a refinancing and a restructuring of the external debt," Maduro told the country.

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Back to the Bakken

Active rigs:

$54.69→	11/3/2017	11/03/2016	11/03/2015	11/03/2014	11/03/2013
Active Rigs	55	36	69	186	181

RBN Energy: crude oil shuttle pipelines and gathering systems in the Permian, Part 5.

Permian crude oil production now tops 2.5 million barrels a day (MMb/d) and is expected to increase to 3.5 MMb/d by 2022 under RBN’s least optimistic price scenario.

If prices hold steady or rise, production in the play could easily surpass 4 MMb/d within five years.

But the Permian’s output isn’t just dependent on price. It’s also critically important that sufficient gathering capacity is in place to efficiently transport crude from the lease to central points where oil can flow onto shuttle pipelines or takeaway pipes. Today, we continue our blog series on key infrastructure in the nation’s hottest shale region with a look at a number of existing and planned gathering systems.

With Permian production on the rise, there’s been a big push on to expand regional pipeline networks’ capacity to move more crude oil out of the play’s Delaware and Midland basins and — just as important — to give producers and shippers as many destination options as possible. Until a few years ago, most of the oil produced in the Permian flowed north to the crude storage and distribution hub in Cushing, OK. By 2011-12, though, rising crude production in the Bakken, western Canada and the Permian itself — combined with too little pipeline capacity from Cushing to the Gulf Coast — caused a supply glut at Cushing. That, in turn, caused heavy discounting for Cushing benchmark West Texas Intermediate (WTI) versus Louisiana Light Sweet (LLS) at the Gulf Coast, and spurred development of new takeaway capacity from the Permian to Houston and other coastal destinations.

Inappropriate exuberance: I thought I was inappropriately exuberant about Apple, Inc. I can't come close to this contributor over at Seeking Alpha. 

Making America great again: Broadcom "will move" back to the US following Trump's push for tax reform. The company will "move" regardless of how things turn out.