The Million Dollar Way (The Bakken Oil Blog): 07/26/18

Thursday, July 26, 2018

A Reader Requests An Opinion -- July 26, 2018

For various reasons, I don't want to be more specific with regard to this issue.

A reader inherited mineral rights in one of the areas marked with an oval and labeled, A - E.

The other areas, numerically identified, are there for comparison.

The reader wanted to know whether:

it was likely the operator would be drilling any time soon in those areas, A - E
for areas A- E would be it better: holding for the royalties in the future, or selling now for cash, and forgoing future royalties (i.e, sell or hold)

My thoughts:

the area is northeast of Williston and has been seen to be a fairly good location, perhaps not as good as the best Bakken but certainly quite nice areas: East Fork, Stony Creek, Epping
each of those areas, in fact, from my point of view, have been great oil fields -- not something I would easily give up
the reader should note that an operator currently has a rig on #34465, ]in the immediate area -- which suggests to me that operators are going to continue drilling this area
without mentioning the name of the operator the reader mentioned, I can say that of all the operators in the Bakken, I would be happy with this operator
daily activity reports suggest operators are getting more aggressive (rather than less aggressive) drilling in the Tier 1 locations in the Bakken) with the price of WTI trending up; and, choke points in the Permian making the Bakken look more attractive than the Permian

Every individual's situation is different.

My advice:

anecdotally, it's been my experience that folks who have sold their mineral rights in the Bakken, later regret it;
if one needs the money now, and has no heirs, selling the mineral rights might be the right thing to do;
if one does not need the money now, and has no heirs, I would still probably keep the mineral rights;
if one does not need the money now, and has heirs, I would definitely keep the mineral rights;
as the operator gets closer and closer to drilling this area, the offers to buy the mineral rights will increase and the offers will get better;
the reader should look at the production profiles of the recently drilled wells (permits in the 3XXXX range);
I am pretty confident that at some point, in each 1280-acre drilling unit, there will be:

a minimum of 6 middle Bakken wells
a minimum of 12 Three Forks wells, spread among the three upper benches

operators drilling in the Bakken these days generally have an expectation of EURs of one million bbls/well, certainly in the areas noted above.

I'm curious what others might think.

Reply anonymously in the comment section or directly to my e-mail address which can be found at the sidebar at the right.

Disclaimer: one has to assume that all readers who respond are simply providing an opinion and cannot be held "liable" for their advice. I don't see this as anyone, including me, giving any advice, simply giving an opinion.

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The Ledecky Page
or
How Can The AP Get Such A Simple Story So Screwed Up?

Katie Ledecky wins her second of two events.

Yesterday (Wednesday), Katie took first in the 800-meter freestyle.

Just minutes ago it was reported that Katie won the 200-meter freestyle.

200-meter freestyle (note this was from the linked AP site -- completely messed up):

Katie takes first, 1:55.82 -- that is the second-fastest time in the world in this event; Katie holds the world record which she set last month, at a time of 1:54.66
second place was won by three-time Olympian champion Allison Schmitt, clocking in at 1:54.60

Obviously the linked AP story has errors; waiting for corrections. [Wow, the AP story really appears to be "screwed up." See below, from SwimSwam].

Later: it looks like SwimSwam has it correct, regarding the 200-meter freestyle:

world record is held by Federica Pellegrini, 1:52.98, set in 2009 (if accurate Katie does not hold the record as stated above; confirmed at wiki)
today:

Katie Ledecky, first at 1:54.60 (which would be better than her June time of 1:54.66 if that is accurate from the story above)
Allison Schmitt, second at 1:55.82

Number Of Active Rigs Continues To Trend Down; Slawson Reports A Huge Completed DUC, As Does MRO -- July 26, 2018

Active rigs:

$69.54→	7/26/2018	07/26/2017	07/26/2016	07/26/2015	07/26/2014
Active Rigs	63	60	33	73	193

Seven new permits:

Operators: Hess (6); Kraken Operating
Fields: Blue Buttes (McKenzie); Painted Woods (Williams)
Comments: Hess has permits for a 6-well BB-Federal pad in SENE 8-151-95;

Twenty-four permits renewed:

Petro-Hunt (13): a Joel Goodsen permit; two Dudley Dawson Federal permits; one Lloyd Christmas permit, the first three in McKenzie County; the Lloyd Christmas permit in Stark County; three Chip Diller Federal permits in McKenzie County; five USA permits in McKenzie County; a Robert The Bruce permit in McKenzie County;
Oasis (4): two Jensen permits, and an O.M. Erickson permit, all in Williams County;
Crescent Point Energy (3): one Legacy Et Al Berge permit in Bottineau County; one CPEUSC Lloyd and one CPEUSC Elena permit, both in Williams County; and, an Erickson permit in Burke County3303
Sinclair (2): one Olson Federal permit in Dunn County; a Porcupine permit in Dunn County
Thunderbird: one Frank permit in Stark County
Whiting: one Wright permit in McKenzie County

One permit canceled:

Resonance Exploration: a Resonance R.E. Ballantyne permit in Bottineau County

Four producing wells (DUCs) reported as completed:

24521, 1,628, Slawson, Gabriel 7-36-25TFH, North Tobacco Garden, t6/18; cum --
33032, 693, BR, State Veeder 2B-UTFH, Blue Buttes, t6/18; cum --
33033, 756, BR, State Veeder 2C MBH, Blue Buttes, t6/18; cum --
33580, 3,276, MRO, McFadden 14-11H, Bailey, t6/18; cum -- (#17498)

Finally, still one more SM Energy well transferred to Petro-Hunt.

August, 2018, NDIC Hearing Dockets Have Been Posted -- I Will Post The Summary Later

The NDIC hearing dockets for August, 2018, have been posted. Link here.

Dockets are posted at the NDIC site here.

Dockets are tracked here.

The usual disclaimer applies. As usual this is done very quickly and using shorthand for my benefit. There will be factual and typographical errors on this page. Do not quote me on any of this. It's for my personal use to help me better understand the Bakken. Do not read it. If you do happen to read it, do not make any investment, financial, job, relationship, or travel plans based on anything you read here or think you may have read here. If this stuff is important to you, and I doubt that it is, but if it is, go to the source.

Highlights in bold.

Wednesday, August 22, 2018

26799, BR, Pershing-Bakken, suspend, revoke legalese against Abraxas, McKenzie
26800, BR, North Fork-Bakken, suspend, revoke legalese against PetroShale, McKenzie
26801, Kraken Operating, Ellisville-Bakken, establish two overlapping 2560-acre units; one well each, Williams County
26802, Kraken Operating, Ellisville and/or Rainbow-Bakken, establish an overlapping 2560-acre unit; one well; Williams
26803, Kraken Operating, Rainbow-Bakken, establish an overlapping 2560-acre unit; one well, Williams County
26804, Whiting, Sanish-Bakken and/or Robinson Lake-Bakken, amend, establish an overlapping 2560-acre unit; two wells; Mountrail
26805, Whiting, Sanish-Bakken, two wells on one overlapping 2560-acre unit; establish an overlapping 3200-acre, two wells; Mountrail County
26806, Whiting, Sanish-Bakken, amend, establish four overlapping 2560-acre units; two wells on each unit; Mountrail County
26807, Whiting, Sanish-Bakken, amend; i) establish six overlapping 2560-acre units; two wells each; ii) establish an overlapping 3840-acre unit; two wells on the unit; iii) terminate two overlapping 2560-acre unit; Mountrail County
26808, Whiting Sanish-Bakken and/or Robinson Lake-Bakken, i) establish an overlapping 2560-acre unit; two wells; ii) establish an overlapping 3840-acre unit; two wells; Mountrail County
26809, Whiting, Sanish-Bakken, amend, 0_ establish four overlapping 1920-acre units; two wells; ii) establish four overlapping 2560-acrre units, two wells; iii) establish one overlapping 3840-acre unit; two wells each; Mountrail County
26810, Whiting, Sanish-Bakken, amend, i) establish three overlapping 1280-acre units, two wells each; ii) establish four overlapping w560-acre units; two wells; each; iii) establish one overlapping 3840-acre unit, two wells on the unit; iv) terminate five overlapping 2560-acre units; Mountrail
26811, Whiting, Sanish-Bakken and/or Parshall-Bakken, amend, i) establish six overlapping 1920-acre units, two wells each; ii) establish four overlapping 2560-acre units, two wells each; iii) establish two overlapping 3840-acre units, two wells one each unit; Mountrail County
26812, True Oil, North Branch-Red River, re-establish spacing for the pool establish a 320-acre unit, or alternatively establishing a 320-acre unit, one vertical well; McKenzie County
26813, True Oil, Bowline-Bakken, i) terminate two laydown 1280-acre units; ii) establish two standup 1280-acre units; seven hz wells on each spacing unit; McKenzie
26814, True Oil, Bowline-Red River, establish a 320-acre unit, one vertical well McKenzie County
26815, True Oil, Bowline-Red River, establish a 320-acre , one vertical well; McKenzie County
26816, SWD
26817, Oasis, SWD
26818, BR, commingling
26819, Whiting, commingling
26820, Whiting, Sanish-Bakken, 5 wells on a laydown 640-acre unit; Mountrail, McKenzie;
26821, Hess, commingling,
26822, Hess, commingling,
26823, Hess, pooling,

Thursday, August 23, 2018

26824, NDIC, consider higher bond amounts for Scout Energy, Wiley-Glenburn Unit, Bottineau County,
26825, ditto, but for Northeast Foothills-Madison Unit, Burke County
26826, North Range Resources, temporary spacing for oil/gas discovered by Beta Race Federal well, #15167, Billings
26827, NDIC, alter spacing units in Cedar Coulee or Oakdale-Bakken, Dunn County
26828, CLR, Banks-Bakken, establish an overlapping 2560-acre unit, two wells, McKenzie County
26829, CLR, Sanish-Bakken, establish an overlapping 3360-acre unit; one well; McKenzie, Mountrail
26830, CLR, Sanish-Bakken, amend, a single well; McKenzie, Mountrail
26831, Liberty Resources, East Tioga-Bakken, amend, establish two overlapping 1280-acre spacing units, 8 wells on each; Mountrail
26832, Liberty Resources, Enget Lake-Bakken, establish two overlapping 1280-acre units; 8 wells on each, Mountrail
26833, Sinclair, Lone Butte-Bakken; terminate one 2560-acre unit and replace it with two 1280-acre units; 7 wells on each;
26834, RimRock, Heart Butte-Bakken; amend; establish an overlapping 2560-acre unit; two wells; Dunn County
26835, RimRock, South Fork-Bakken, amend, establish two overlapping 2560-acre units; two wells on each unit; Dunn County
26836, RimRock, McGregory Buttes-Bakken, establish an overlapping 2560-acre unit; two wells on the unit; Dunn County
26837, Zavanna, Patent Gate-Bakken, amend, establish an overlapping 2560-acre unit; two wells; McKenzie;
26838, NP Resources, Tree Top-Bakken, establish two standup 1280-acre units; 4 wells on each unit; Billings County
26839, NP Resources, Magpie-Bakken, 4 wells in an existing 1280-acre unit; also, establish a new 1280-acre unit for four wells; Billings County
26840, NP Resources, Buckhorn-Bakken, 4 wells on an existing 1280-acre unit; establish three new 1280-acre units; four wells on each; Billings County
26841, NP Resources, Cinnamon Creek, Pierre Creek, and Buckhorn-Bakken, dissolve two existing undeveloped 1280-acre units; expand the Cinnamon Creek Field boundary; establish three standup 1280-acre units for four wells each; McKenzie County
26842, CLR, pooling
26843, CLR, pooling,
26844, CLR, Brooklyn-Bakken, two wells on an existing 2560-acre unit; Williams county
26845, CLR, Banks-Bakken, 16 wells on an existing 1280-acre unit; McKenzie;
26846, WPX, commingling
26847, Newfield, pooling
26848, LIbery Resources, pooling
26849, Liberty Resources, pooling
26850, Liberty Resources, Enget Lake-Bakken, 8 wells on an existing 1280-acre unit; Mountrail County
26851, Liberty Resources, pooling
26852, Liberty Resources, pooling
26853, RimRock, Heart Butte-Bakken, i) 14 wells on an existing 1280-acre unit; ii) 3 wells on an existing 2560-acre unit; iii) 2 wells on an existing 2560-acre unit; Dunn County
26854, RimRock, South Fork-Bakken, i) 11 wells on two existing 1280-acre units; ii) 15 wells on an existing 1280-acre units; iii) 3 wells on an existing 2560-acre units; Dunn County
26855, RimRock, Moccasin Creek-Bakken; 3 wells on an existing 1280-acre unit; Dunn County
26856, Zavvana, Poe-Bakken, 2 wells on an overlapping 2560-acre unit; McKenzie County
26857, BNN North Dakota, SWD,
26858, NP Resources, Rough Rider-Bakken, 4 wells on an existing 1280-acre unit; McKenzie County
26859, PetroShale, pooling

New Poll Pending -- Stay Tuned -- July 26, 2018

Taking down the poll in which we asked whether you would like to have President Trump extend credits for EVs?

yes: 11%
no: 89%

New poll: your guess -- first estimate of 2Q18 GDP.

Quick! For Bakken Newbies, What's Equinor? -- July 26, 2018

Choose among the following:

the chief valkyrie living deep inside Valhalla
second in command to Darth Vader; a transgender and thus the name ("Equi-")
former name of Statoil
the last name of Putin's translator, short for Equinatsky
one of the many My Little Ponies, the greenish-purple one

Why am I asking? A reader sent me the link to this press release:

Ambyint, the emerging player in AI-powered artificial lift and production optimization, and international energy major Equinor today announced that Equinor will deploy Amybint’s technology on all rod pump wells in Equinor’s Bakken asset in North Dakota.

The partnership comes at the end of a successful pilot and will expand to full field implementation in this asset.

During the pilot, Equinor was able to automate rod pump well optimization through use of Ambyint’s autonomous setpoint management functionality.

By identifying wells that were over-pumping or under-pumping, controller set points were adjusted with minimal human interaction. This kind of proactive machine-driven optimization resulted in increased production rates and pump efficiency while reducing well volatility.

“The Ambyint technology has improved the remote data visibility and has delivered a more accurate diagnostic of downhole conditions to our rod pump wells in the Bakken. The Autonomous speed range management tool has leveraged the power of machine learning to optimize our wells by identifying and acting on real opportunities,” said Jack Freeman, Production Engineer for Equinor’s Bakken Asset.

Ambyint.

Not to be confused with Ambien.

Apparently Ambyint technology will allow the engineer to get a full night's sleep without having to wake up every hour to check on whether a given pump is over-pumping or under-pumping.

The Golden Age -- Scott Adams -- July 26, 2018

Idle rambling; not ready for prime time. In a long note like this there will be typographical and factual errors. I've given the fact-checkers and the spell-checkers the day off so they can enjoy the hot weather and go swimming.

Are "we" -- investors -- sitting in the sweet spot right now? Think about it:

earnings

as good as ever
and it seems the earnings are due largely to revenues
revenues (top line) minimally affected by tax policy
earnings (bottom line) are affected by tax policy; I haven't heard many pundits suggest earnings are due to better tax policy (21% vs 35%) -- huge -- and it will get "huger" (as Bush II) would say -- by the end of the year
some say the Trump tax plan extended the recovery / bull run another two or three years; without the reduction in taxes, some suggested the economy could turn "bad" as early as next year
unlike the "bubble" back in 2000 (or whenever it was), I've heard very few pundits suggesting the market is overpriced
it's hard to find blue chip companies paying better than 2.5% on dividends
it seems folks are getting used to "the curve" flattening -- higher interest rates short term, lower interest rates long term .... hmmm.....
investors have "baked in" the Fed; nothing seems to suggest this will change

crude oil

pundits suggest crude oil could go as high as $400/bbl in the "out years" -- next decade -- because there is not enough successful exploration by the oil industry
other pundits suggest there is too much crude oil being produced and could go as low as $45 next year
US energy independence is here; seriously -- it depends "how" one defines independence
geo-political events that would normally spook the market (Israelis in a "hot war" with Syria; Iran "clearly admits" to attacking two Saudi Arabian VLCCs in the Red Sea) result in crude oil jumping .... 16 cents/bbl
for oil investors, $55-oil is the "Goldilocks" price -- enough that oil companies survive, but not push the economy into a depression; and, in fact, instead of $55-oil, we have $70-oil and the economy seems to handle it very nicely

2Q18 GDP numbers -- first iteration -- will be released tomorrow; everyone is expecting a nice number; some say "we've" been here before -- that in 2014 we had similar growth -- the point is being missed -- in 2014 -- we were coming off one of the greatest recessions in the history of the US
worse -- it was the longest recovery ever after any recession; it was taking "forever" to turn the corner
now, for several quarters (several years) the economy has been doing great; "everyone" has been suggesting a correction should have already occurred or a recession is around every corner ... and yet, long into a long, long, slow, extended recovery, we could see a GDP number that is quite exceptional
right now, the CNBC crawler says 2Q18 GDP is tracking 4.1% (one has to assume CNBC will build up expectations such that folks will be let down when the number is finally reported, but that's another story for another day -- probably tomorrow)

trade war

not much needs to be said
"everybody" agrees to free trade; but "everyone" that says also sees no problem with Canada's 275% tariff on US dairy; or the 25% tariff American car manufacturers face trying to sell cars overseas when the US has a 2.5% tariff on foreign automobiles
"everyone" opines the trade war will be the end of the world as we know it, and that it will escalate
golden age? yesterday the EU agrees to work with the US to get to "zero" tariffs; the market swung 210 points on that news, from negative to positive
the market extended that gain today

farmers

"everyone" freaks out about the plight of the farmer due to trade wars; immediately they are promised a $12-billion bailout; it would be the brave congresswoman or US senator to voice opposition to helping the farmers; that promise of a bailout probably kept the "farm" sector of stock market from tanking yesterday/today
where's Willie Nelson and Farm Aid?
no sooner does President Trump announce the $12-billion bailout and the EU promises to buy more US soybean, and the price of soybean pops

the southern US border?

haven't heard a thing in weeks

North Korea

dismantling rocket launching sites
no nuclear tests since the summit
no rocket launches since the summit

Germany and NATO and Russia and Nord Stream 2

US LNG sector wins

Putin-Trump summer redux?

second summit will be delayed until after the mid-term elections

global warming: not even on the minds of Americans

From a post that isn't that very old, February 26, 2018:

Some time ago, I presented "sixteen reasons" why the market was surging then. I then followed it up with "eight more reasons" why the market would continue to surge. I then added "another reason."

I am now going to add "five more reasons" why the market will continue to surge.

In the short run, maybe just a day or two or week or two, the tea leaves suggest a reason for buyers to buy: the volatility index is back to "zero" or some such ridiculously low number.

The real reason for the market surge today (actually there were two and they were both related): the annual Berkshire Hathaway letter and the treacly Becky Quick-Warren Buffett interview.

Warren Buffett gave the signal that everything was okay in the market and it was safe to buy.

Warren Buffett said (to paraphrase) that anyone investing in bonds was an idiot; that will move a lot of money from bonds to equity.

AAPL shares gave a clear signal that tech was back (it came close to reaching its all-time high). Note: many analysts no longer consider Apple, Inc, a tech company. [Note: today, July 26, 2018, AAPL is flirting with new all-time highs, trading at $194 and change; back on February 26, 2018, AAPL was trading at $179]

The bond market (again, actually there were four reasons with regard to the bond market)

first, Warren Buffett called ... well, see 2b above

second, when the 10-year Treasuries did hit 3% on yield, and the world did not come to an end, that calmed the market

third, as the market panicked with 3% yield on ten-year Treasuries (and the Dow corrected by 10%) more and more folks came out of the woodwork to tell us that "this time was different." Don't worry about the ten-year Treasury yield; we will all do just fine.

today, and maybe this is the other reason (the first reason being Warren Buffett's letter and treacly interview) the market surged today: the ten-year Treasury dropped back to a 2.8% yield. [Today, July 26, 2018, the 10-year bond is at 2.973%.]

the 10% correction was really, really overdone; folks are still trying to sort that out; so now the pendulum is swinging the other way; but it's an open-book test: after every correction, there's a surge.

percent of S&P 500 companies beating sales estimates highest in over a decade.

So, now we have these reasons for a surging bull market:

sixteen reasons

eight more reasons

one more reason

six more reasons

The next "GDP Now" estimate comes out tomorrow. Let's see if we have yet another reason for the market to surge.

In fact, the first 2Q18 estimate will be reported tomorrow. Anything less than 9.8% GDP growth will be considered a reason for CNBC to talk the market down.

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Notes For The Granddaughters

The other day I mentioned RAF Mildenahall.

RAF Mildentall, F-15, Unrestricted Take-off
When I was stationed at RAF Mildenhall many decades ago, I bought Maerklin HO model railroad locos, stock, and track from an individual who worked out of his home. He lived in a new home; he built his home literally two feet from the fence line at the end of the runway, RAF Mildenhall, simply to watch the USAF flight operations.

Often, when I went out to visit him, he told me more about timing of "secret" operations than even I had been briefed in on. He was no foreign spy; he simply was very, very, very observant.

RAF Mildenhall: near Cambridge, England, northeast of London.

Next Challenge: Finding Insurers To Insure OIl Tankers Carrying Iranian Crude Oil -- Why I Love Blog, Reason #254 -- July 26, 2018

Updates

July 29, 2018: Iran starts self-insuring oil tankers to India.

Iran has started to offer India cargo insurance and tankers operated by Iranian companies as some Indian insurers have backed out of covering oil cargoes from Iran in the face of the returning U.S. sanctions on Tehran.

Iran is looking to continue to sell its oil to India—its second-largest single oil customer after China—even as some Indian refiners are said to be thinking of reducing oil imports from Iran for fear of running afoul with the U.S. sanctions and having their access cut off to the U.S. financial system.

Original Post

Wow, wow, wow! Why I love to blog. I said exactly this a few weeks ago, and I've said it at least twice. Leaders of foreign countries like India, China, etc., can say they will ignore US sanctions and continue to import oil from Iran. They can say that.

But, there's that little problem of risk ...

From Reuters via oilprice.com:

Hindustan Petroleum has cancelled a crude oil shipment from Iran after its insurer refused to provide coverage for the cargo on concern about U.S. sanctions, citing three unnamed sources familiar with the matter.

Hindustan Petroleum, India’s third-largest state-owned refiner, ordered the 1-million-barrel shipment earlier this month, and after the refusal of its insurance company to cover a cargo loaded on an Iranian tanker, it tried to sell it on but could not find buyers.

The Indian refiner imports about 20,000 bpd of Iranian crude, which is a relatively small part of its daily consumption, which amounts to 316,000 bpd, but other Indian refiners could run into the same problem.

Hindustan Petroleum had just renewed its installation insurance when the insurance company refused to cover the cargo and bigger refiners might have to cancel Iranian cargoes, too, if their insurance policies happen to have to be renewed before the November 4 deadline given by Washington to all companies doing business with Iran before sanctions kick in.

An Intermission -- Reading The Victorians -- July 26, 2018

Off to Hurricane Harbor:

Relaxing in the pool:

Talking to newfound friend (long, long story):

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The Book Page

From Chapter 13, "Marx - Ruskin - Pre-Raphaelites", The Victorians, A. N. Wilson, c. 2003:

The word "Pre-Raphaelite" in popular modern parlance does not refer to particular painting techniques or attitudes to the Middles Ages.

[Pre-Raphaelite] means young women with pale faces, pouting lips and abundant hair. The hair was important -- this was the 1850's in England; so important that hairdressing, for the first time in English history, came out of the private domain of the home.

Women who could afford to now went to hair-stylists -- the styles varying much from year to year. No respectable woman wore her hair loose -- which is what gives those loose-haired Pre-Raphaelite maidens so much of their erotic charm for the men who painted them and the men who bought the pictures.

And in an age where everything was up for sale, the exporters and importers did not stop at hair itself. Great quantities of hair were imported into Britain fro the European continent. The "hair harvest" in Italy was an annual feature in poorer villages and 200,000 lbs of hair were sold annually in the Paris markets, at a price of 10 shillings or 12 shillings per ounce -- 20 schillings for really long hair.

"We saw several girls," noted one observer at the Collenee market, "sheared, one after the other like sheep, and as many more standing ready for the shears, with their caps in their hands, and their long hair combed out, and hanging down to their waists."

So valuable a commodity had hair become that The Hairdressers Journal reflected on "one most unpleasant feature connected with the business" -- the prevalence of hair thieves who would set upon young women whose head showed a valuable crop, shear them, "and always kept on the safe side of the law, apart from the robbery of the hair."

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The Geography Page

Maluku Island, Moluccas, Malacca

A. N. Wilson brought me here, to wiki:

Ternate is an island in the Maluku Islands (Moluccas) of eastern Indonesia.

It was the center of the former Sultanate of Ternate. It is off the west coast of the larger island of Halmahera.

Like its neighbouring island, Tidore, Ternate is a visually dramatic cone-shape.

The two are ancient Islamic sultanates (Ternate's Sultanate and Tidore's) with a long history of bitter rivalry. The islands were once the world's single major producer of cloves, a commodity that allowed their sultans to become amongst the wealthiest and most powerful of all sultans in the Indonesian region.

In the precolonial era, Ternate was the dominant political and economic power over most of the "Spice Islands" of Maluku.

Today, Ternate City is the largest town in the province of North Maluku, within which the island constitutes a municipality. It is, however, no longer the provincial capital, a title now held by the town of Sofifi on Halmahera.

The "Ternate Essay" was a pioneering account of evolution by natural selection written on the island by Alfred Russel Wallace in 1858 and famously sent to Charles Darwin. Darwin at once responded by publishing Wallace's essay alongside his own accounts of the theory.

Because of the blog, I "understand" Malacca.

Natural Gas Fill Rate -- Wow -- T+56 -- The Market, Energy, Political Page, Part 2 -- July 26, 2018

Wow, who else has noticed this? Rhetorical question, don't answer. We've talked about this before. This is huge considering the shale revolution in the production of natural gas.

Meanwhile:

Crude oil E&P: we've talked about this before -- folks worried that the oil industry has fallen behind in exploration -- I consider it a meme and a false narrative. I'm not worried, one way or the other. Unfortunately, this article does not put "$37 billion" into perspective (except for past three years), from Rigzone, majors on pace to approve $37 billion in projects during this calendar year (2018).

... over 30 percent ($12 billion) of these had already been approved during the second quarter.

BP, Eni, Royal Dutch Shell, Total, ExxonMobil, and Chevron approved over $77 billion worth of greenfield projects from 2015 to the first quarter of 2018.

Of this figure, BP approved the most at $27.6 billion, followed by Eni at $25.4 billion, and Shell at $11.1 billion.

So, $77 billion / 13 quarters = $6 billion quarter (from 2015 to 1Q18, inclusive = 13 quarters). This calendar year, $37 billion / 4 quarters = $9.25 billion / quarter.

Even this arithmetic doesn't do much for clarification or perspective -- but it is what it is.

Another link.

The Market, Energy, Political Page, T+56 -- July 26, 2018

Talking down the market: yesterday CNBC tried to talk down the market after Trump's press conference (and another huge win); Yahoo!Finance did it's part.

So, how did that work out? At 11:30 a.m. CDT, the Dow, up 120 points, is on track to have the best close since February 26, 2018.

T+55 (yesterday): EU met with Trump; the trade war between the US and the EU is over. Next up: Mexico. Then, Canada. Finally China. I will likely carry the current "run" to T+100 or when the trade war between China and the US comes to an end, whichever comes first.

McDonald's -- a reader noted that McDonald's beat both on the top line and the bottom line. My reply to the reader, not ready for prime time, and with minimum editing:

Wow, I missed an opportunity. I was at McDonald's two days ago -- I did not order anything because the line was too long. I blogged for over an hour during the noon hour at McDonald's -- never ordered anything -- way too busy -- the line never got short enough. I was going to blog about that experience but thought I had blogged too much about McDonald's so didn't want to blog again.

One has to remember: McDonald's is practically giving away their soft drinks -- in the hot weather I bet that drives a lot of customers --

McDonald's: anyone visiting the newly remodeled McDonald's and the layout of the kiosks and the soft drink fountains at some of them will see what I mean by McDonald's practically giving away their soft drinks for free. Senior coffee is already 50 cents and has been so for quite some time.

So, what's the market doing?

TSLA: essentially flat, down about 0.75%
FB: down 18%
UNP: flirting with all-time hights
BRK-B: essentially flat, very barely green
AAPL: essentially flat, very barely green -- hardly a rough day for tech
EW: essentially flat, up about 0.70%
XLNX: up 12% -- remember, Yahoo!Finance said it was going to be a rough day for "tech." You cannot get "any more tech" than XLNX -- pretty much alone in the programmable chip sector;
F: continues to fall, now down another 4.4%
SRE: this is an important one following Governor Jerry Brown's proposal; up about 0.7% and trading in a nice range
COP: actually down about a percent; wow [Update, 11:58 a.m. CDT -- I've been waiting all morning for COP to go "green" and it's almost there, having climbed from a loss of 40 cents (day-over-day) to just one cent down for the day. LOL.][Update, 12:01 p.m. CDT -- wow, COP just went green by seven cents. LOL.]
S: up over a percent
Andeavor (Tesoro): up almost 6%; up over $8 -- yup, it's been a rough day for traders

Disclaimer: this is not an investment site. I am invested in some of the companies I mention on the blog but in the big scheme of things, very, very few of them. Some I used to hold, but no longer hold. I have no plans -- because I have no discretionary cash -- to buy any shares in anything in the foreseeable future (i.e., the next four days). I know I'm not going to be selling anything.

Shale is dead. This link will take you to a pdf; depending on your settings it may show up on your browser, or it may download on your desktop. After reading that, I wanted to add "ahead of the herd" to the sidebar at the right but a further look at that site: no.

No sympathy whatsoever: DAPL protester having trouble getting his truck back. LOL.

Only criminals use cash: Lanny Davis, says "only criminals/drug-dealers use cash." Comes up in recent conversation about Trump's alleged payoffs -- or attempts of payoffs -- to prostitutes. Know who else uses cash? President Obama. As in the transfer of $400 million in cash to Iran the night before Obama leaves office. Wow.

Jobs: another nice jobs report. New jobless claims:

consensus: 219K
actual: only 217 K
an increase of 9K after prior revision

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The Vocabulary Page

The word wall at Sophia's Tutor Time:

Wow, Oil Flat, Dow Up 140 Points After Iran Practically Admits To Staging The Attack On Two Saudi Arabian VLCCs In The Red Sea This Past Week -- July 26, 2018

... and what is CNBC talking about? I don't know. I'm not watching CNBC. I'm at Starbucks, but my hunch is that CNBC is still talking about Facebook, and trying to talk the market down.

But look at this -- from our Mideast bureau (this started yesterday):

This would be bad at any time -- Iran suggesting it actually staged an attack on Saudi Arabia, but at a time when Prince Salman is trying to launch the world's biggest IPO, this is not a good way to start the day.

Wow, this is the equivalent of:

Make My Day

The Market Is In For A Rough Start Today -- Yahoo!Finance -- July 26, 2018

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.

A few weeks ago I mentioned in passing that I felt sorry for young investors just getting starting who listen to CNBC and read Yahoo!Finance to get a feel for the market. Wow, it's my impression that they, especially CNBC, consistently try to "talk the market down ... asking over and over what could "hurt the market.

I saw that again yesterday afternoon. Thirty minutes before the close the Dow had a 210-point swing, going from minus 40 to plus 170. Anyone paying attention knew a) the short term explanation; and, b) the long term implications -- both huge bullish signs. And yet, CNBC continued to try to talk the market down, suggesting this was a one-off. I was eagerly waiting to see what Jim Cramer would say. Surprisingly, he didn't mention a thing for rhe first ten minutes. I turned him off and went back to reading.

Then this on Finance!Yahoo which was posted in response to the 210-point swing, again, scaring novice investors, suggesting that the 210-point swing was reason for more caution, now more than ever:

So, futures?

Up, NASDAQ and S&P 500 are down after a great day yesterday -- not surprisng to see some profit-taking, but the Dow -- even if it is irrelevant as ever -- is up over 50 points in pre-market trading.

Yes, NASDAQ = tech, but I can't get too excited based on what I'm seeing in pre-market trading. By the way, XLNX -- a tech stock -- specialty chips -- see above -- was up almost 8% when Yahoo!Finance warned investors about tech today. In pre-market trading now, XLNX is up 6.66% -- oh, oh -- the sign of the beast. LOL.

Yahoo!Finance suggests troubles at Facebook (down 24% yesterday) -- and stable this morning -- will mean the same for the rest of the tech industry. I won't argue that Facebook fits in this space, but to me, Facebook is "social media," not "tech."

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.

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A Note For My Wife

This is pretty funny, sent to me by a reader, based on recent conversations and notes on the blog.

We were talking about primogeniture.

My wif'e's current heartthrob -- okay, he competes with David Muir (ABC News) for that "right of honor -- is Benedict Cumberbatch. From wiki:

As a legitimated grandson of the sovereign, John Beaufort bore the arms of the kingdom, differenced by a bordure gobony argent and azure [border panels of silver and blue].

The family emblem featuring the portcullis was shown on the reverse of British pennies minted between 1971 and 2008. According to genealogists, a few of Beaufort's notable descendants include British actor Benedict Cumberbatch and codebreaker Alan Turing.

Coincidentally, Cumberbatch portrayed Turing in the film The Imitation Game.

Don't get me started.

Benedict Cumberbatch made his mark in of my favorite movies, one I re-watch several times a year, sometimes several times a month: Tinker, Tailor, Soldier, Spy, perhaps the greatest love story of all time.

Both my wife and I enjoyed The Imitation Game. She enjoyed it more than I but that was probably because not only was it a great story/movie, but it starred her heartthrob.

The Beauforts figured frequently into the royal histories portrayed by William Shakespeare, and will eventually lead one to the "real" William Shakespeare.

I've read much on this Shakespearian history -- most of my notes are off-line but one note that I never got around to finishing is here: "Blood Sisters: The Women Behind the Wars of Roses."

"The arms of the kingdom" also plays a key part in Shakespearian histories. Shakespeare knew more about cannon and the making of cannon than anyone -- other than those actually involved in the art and industry of cannon-making.

US Gas Exports To Mexico Hit Record -- Pipeline Infrastructure Was Key -- July 26, 2018

Fast and furious:

rough start and talking the market down -- I will come back to this
COP: earnings; full filing here; waiting for transcript;
Shell: kicks off big oil earnings with growth spirit
DAPL: civil asset forfeiture -- no sympathy from me
jobs report: another great jobs report: CNBC does not cover it
McDonald's beats by 7 cents; beats on revenue
Citi makes case for $45 oil next year -- that the headline -- actual range, $45 - $65

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Back to the Bakken

Wells coming off the confidential list today:

31953, 1,072, Hess, EN-Vachal-155-93-0532H-6, Alger, t6/18; cum --
31518, 1,538, CLR, Lansing 8-25H1, Banks, a very nice well; this was a DUC; now back on conf; the CLR Lansing wells are tracked here; t3/18; cum 84K 5/18;
23556, SI/NC, Slawson, Gabriel 1-36-25H, North Tobacco Garden, no production data,