Trump Doubling Down On Refuting Climate Change As A National Security Threat For The US -- December 15, 2017

Updates

December 26, 2017: Exposed: How World Leaders Were Duped Into Investing BillionsOver Manipulated Global Warming Data, The [London] Daily Mail.

Original Post 

From What's Up With That:

The Trump administration will reverse course from previous Obama administration policy, eliminating climate change from a list of national security threats. The National Security Strategy to be released on Monday will emphasize the importance of balancing energy security with economic development and environmental protection, according to a source who has seen the document and shared excerpts of a late draft.

“Climate policies will continue to shape the global energy system,” a draft of the National Security Strategy slated to be released on Monday said.

“U.S. leadership is indispensable to countering an anti-growth, energy agenda that is detrimental to U.S. economic and energy security interests. Given future global energy demand, much of the developing world will require fossil fuels, as well as other forms of energy, to power their economies and lift their people out of poverty.”

Finally, some clear thinking and adult leadership.

And just a reminder: bitcoin is forecast to use the entire global supply of electricity within the next three years.

Not ready for prime time. After a reader sent me the story, I replied:

There were a lot of military officers (generals, admirals) that were made to look like idiots under Obama -- I know they had no choice, but to tell warfighters to tackle climate change was absolutely ridiculous. In hindsight, they truly look ridiculous. Especially the admiral and general officer that explored powering naval destroyers with biofuel, and powering jet fighters with algae (or vice versa), respectively.

On a second note, this is doubling down. At the recent (last week/this week) Schwarzenegger, Macron, et al took on Trump and told him to get back on board. Macron (France) predicted that Trump would come back to the Paris accord. Trump, apparently, has made it very clear that he probably won't.

Finally, it was his daughter and son (or son-in-law) who were pushing Trump to go along with climate change. Apparently they've lost a bit of influence, at least in this arena.

One can argue whether fewer regulations out of Washington make a difference, but this is the market today:

Ten DUCs Completed; Eight Permits Renewed; Four New Permits -- December 15, 2017

 Active rigs:

$57.36→	12/15/2017	12/15/2016	12/15/2015	12/15/2014	12/15/2013
Active Rigs	53	40	64	182	191

Four new permits:

• Operators: Lime Rock Resources (2); EOG (2)
  Fields: Fayette (Dunn); Painted Woods (Williams)
  Comments:

Ten producing wells (DUCs) reported as completed:

• 31526, 1,751, Hess, EN-Skabo Trust -155-93-0631H-4, Alger, t12/17; cum --
• 31527, 1,468, Hess, EN-Skabo Trust-155-93-0631H-5, Alger, t11/17; cum --
• 31528, 1,767, Hess, EN-Skabo Trust-155-93-0631H-6, Alger, t11/17; cum --
• 31529, 1,099, Hess, EN-Skabo Trust-155-93-0631H-7, Alger, t11/17; cum --
• 31894, 1,420, XTO, JMB 14X-15AXD, Capa, 4 sections, t11/17; cum -- (#19504, #16656 -- not refracked)
• 31895, 1,433, XTO, JMB 14X-15EXH, 4 sections, t11/17; cum --
• 31896, 1,531, XTO, JMB 14X-15A, t11/17; cum --
• 31897, 582, XTO, JMB 14X-15E, t9/17; cum --
• 31898, 1,003, XTO, JMB 14X-15B, t11/17; cum --
• 33129, 1,904, Hess, SC-1WX-152-99-00809H-8, Banks, t11/17; cum --

Eight permits renewed:

• CLR (5): one Tanager permit and one Nuthatch permit, both in Divide County; two Thronson permits and one Sorenson permit, all in Mountrail County
• MRO (2): one Alvina USA permit and one Whitney USA permit, both in Dunn County
• Resonance Exploration: a Resoanance Ballantyne permit in Bottineau County

No permits canceled.

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Jump In Production

Updates

November 19, 2018: see this post.

Original Post

Note this "old well" -- #16656: this well is celebrating its 10th birthday, and production was leveling out at 1,000 bopd; then for unexplained reasons, production jumped to 24,000 bbls in 10/17; see graphic below.

• 16656, 411, XTO, Hazel 44X-22, Capa, t10/17; cum 309K 10/17; look at recent production data:

Monthly Production Data:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2017	31	23816	23749	41636	42802	13204	29309
BAKKEN	9-2017	3	1245	954	6907	3595	773	2807
BAKKEN	8-2017	0	0	0	0	0	0	0
BAKKEN	7-2017	0	0	0	0	0	0	0
BAKKEN	6-2017	1	0	0	0	62	62	0
BAKKEN	5-2017	31	1052	1245	512	4600	4412	0
BAKKEN	4-2017	30	1207	1021	630	4892	4322	385
BAKKEN	3-2017	31	1134	1047	473	4573	3477	807
BAKKEN	2-2017	28	896	1092	383	3807	3559	0
BAKKEN	1-2017	31	1093	1009	553	5654	5392	0

Graphic:

 

Director's Cut Is Out; October Data; Bakken Daily Production Jumps Over 7%; Yet, DUCs And Inactive Wells Increase -- December 15, 2017

Director's Cut for October, 2017, data.

Link here. NDIC site for calendar and links for past and current Director Cuts here.

The usual disclaimer applies. I do "this" quickly and there will be typographical and factual errors. If this is important to you, go to the source.

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The Data

Oil production

• October, 2017: 1,185,499 bopd
• September, 2017: 1,107,345 bopd
• Delta: +78,154 bopd, +7.1%
• huge jump in production

Producing wells:

• October, 2017: 14,250
• September, 2017: 14,199
• Delta: an increase of 51 wells; an increase of 88 wells; 0.4% increase

Permitting

• November, 2017: 119
• October, 2017: 147 
• September, 2017: 104
• August, 2017: 101
• July, 2017: 146 (huge jump)

Oil price (WTI), breakeven price statewide = $21

• today: $49.25
• November: $49.75
• October: $43.56
• September: $39.56
• August: $37.93
• July: $35.83
• June: $34.72

Rig count:

• today: 53
• November: 54
• October: 56
• September: 56
• August: 56
• July: 58
• June: 55

Wells not producing, total: about 2,300 wells not producing; that exceeds the number of wells completed in any year during the boom

• waiting on completion: 899, up 36 from the end of September to the end of October;
• estimated inactive well count: 1,471, up 27 from the end of September to the end of October

Takeaway capacity:

• October data: including CBR to coastal refineries is more than adequate
• September data: including CBR to coastal refineries is more than adequate
• August data: including CBR to coastal refineries is more than adequate
• July data: including CBR to coastal refineries is more than adequate
• June data: including CBR to coastal refineries is more than adequate
• May data: including CBR to coastal refineries is more than adequate (major change in verbiage)

Natural gas capture, getting "worse" and FBIR is major issue:

• statewide: 84% (previous -- 83% [trending down to flat])
• FBIR: 74% (previous -- 71% [somewhat better after a terrible month last month)
• goal: 88% through October 31, 2020; then 91%
• comment: last month was terrible; it's getting better on FBIR

So, You Think Coal Is Dead? -- December 15, 2017

Updates

February 11, 2018: now it's Iceland. 

Original Post 

Chinese Coal -- Bitcoin -- Bitter News

One bitcoin transaction now uses as much energy as your house in a week -- Motherboard, November 1, 2017. Bitbcoin's surge in price has sent its electricity consumption soaring.

Bitcoin mining guzzles energy -- and its carbon footprint just keeps growing -- Wired, December 6, 2017. Bitcoin is slowing the effort to achieve a rapid transition away from fossil fuels. What’s more, this is just the beginning. Given its rapidly growing climate footprint, bitcoin is a malignant development, and it’s getting worse.

Bitcoin mining on track to consume all the world's energy by 2020 -- Newsweek, December 11, 2017.

A network that underpins the virtual currency bitcoin is projected to require all of the world’s current energy production in order to support itself within three years, according to estimates.

The amount of power necessary to support bitcoin has increased significantly in recent months, as its price has surged to record levels. On Monday, one bitcoin was worth around $16,500—a twentyfold increase since the start of 2017.

Bitcoin mining—the process of generating new units of the currency by confirming bitcoin transactions on an online ledger called the blockchain—requires computing power, which is used to solve the complex mathematical puzzles used in the mining process. These problems are designed to become more complicated as more computers join the cryptocurrency's network.

Coal is fueling bitcoin's meteoric rise -- Bloomberg, December 14, 2017. China dominates bitcoin making and is the world's top coal burner. 

The Market And Energy Page, T+238 -- December 15, 2017

Market: on track for Dow 30 to close at a new record. Huge volume.

Global Data, global reserves: top ten countries by crude reserves (includes graphic)

• US, Saudi Arabia, Iraq, Russia, Canada, Kuwait, Iran, UAE, Brazil, China
• US #1 in crude oil reserves
• unconventional oil reserves: 9.2% (45.8 billion bbls)
• oil sands reserves: 6.7% (33.3 billion bbls)
  heavy oil reserves: 4.5% (22.2 billion bbls)
• US: top among those with largest remaining crude and condensate reserves
• 91.1 billion bbls expected to be economically recovered in the the US
• other top four:
• Saudi Arabia: 77.4 billion bbls
• Iraq: 71.8 billion bbls
• Russia: 70.6 billion bbls
• remaining 14.1% (70.3 billion bbls) of remaining reserves
• UAE: lowest remaining break-even oil price at $4/bbl for shallow water developments
• US: highest break-even oil price at $32/bbl
• over 77.1% of the ten countries' remaining reserves (383 billion bbls) will be produced from onshore fields
• UAE: lowest remaining break-even oil price at $3/bbl for onshore developments
• Canada: highest remaining break-even oil price at $31/bbl for onshore developments
• ultra-deepwater developments
• 30.3 billion bbls or remaining reserves, spread between two countries
• US: remaining break-even oil price -- $33
• Brazil: remaining break-even oil price -- $37

Global Data, Russia: Russian upstream projects required $100 billion by 2020 to maintain stable production (some numbers rounded)

• an average of $35 billion/year in capital expenditure over next three years
• 1,673 oil and gas fields in Russia
• traditional oil fields: $55 billion over three years
• heavy oil fields: $7 billion over three years
• delta between $62 billion and $100 billion not explained
• onshore projects: 85% of the $100 billion upstream CAPEX ($88 billion by 2020)
• shallow water projects: $15 billion over the same period

Venezuela: pulls out of refinery joint venture in Cuba; Cuba now has full ownership of its Cienfuegos oil refinery.

All Systems Green -- T+238 -- The Ides Of December -- December 15, 2017

Minimal blogging for the next two weeks.

First things first: the Lego NASA Apollo Saturn V is again "temporarily out of stock" at the Lego site. 

NDIC Director's Cut scheduled to be released later today: pending.

Global crude oil data: memo to self -- post data points from this article later. IEA suggests global crude oil inventories will continue to decline.

On the other hand, US shale "recovery" will leave OPEC with a difficult 2018, says the IEA over at CNBC.

• the IEA said that there were signs that the rise in U.S. crude oil supply was likely to continue into 2018 and upset rivals who are cutting back.
• U.S. oil producers are staging a dramatic comeback amid a recovering oil price that has allowed many of them to restart operations.

Global data: Russian upstream projects require $102.6 billion by 2020 to maintain stable production. Link to follow.

Global economy: Japanese corporate sentiment at 11-year high. 

Market: the futures suggest I am way off base. I think there's a greater than 90% chance the GOP tax bill will not pass. Dow 30 is up almost 90 points shortly before the opening. If the buzz on Wall Street that the tax bill was dead, I don't think the market would continue to move higher.

Tax bill: Business Insider has another list. This time a list of places where the new tax bill would hit homeowners hardest. The article is already DOA. My understanding is that conferees have already eliminated the property tax deduction issue by leaving the deduction in for all but the most expensive homes. Before it's over, the property tax deduction issue could be eliminated completely.

GE: has a fossil fuels problem according to CNN. As the tax bill now stands, GE is going to have a huge problem with its renewable energy divisions. It's interesting that "fake news" had this story; again, completely off-base.

Throwaway article but good for the archives. Surprised to find this bit of fluff in The Wall Street Journal: Dow 24,000 and the Trump boom by Maria Bartiromo. The 101 comments may be more fun to read than the article.

********************************************

Back to the Bakken

Active rigs:

$57.20↑	12/15/2017	12/15/2016	12/15/2015	12/15/2014	12/15/2013
Active Rigs	52	40	64	182	191

RBN Energy: now or never -- LNG an alternative for shipowners as low-sulfur rule looms.