Tuesday, October 2, 2018

EV Scorecare, 3Q18; September, 2018, Sales -- In Progress

EV scorecard

Link here.
Year-over-year. Any explanation?
Bolt sales plunged 41 percent during the third quarter from the same time last year and are down 17 percent since the beginning of the year, General Motors said Tuesday.
"The decline is more a function of us diverting production to Canada and South Korea, coupled with low stocks in the U.S.," GM spokesman Jim Cain told CNBC in an email. "We're still proceeding with the Q4 production increase we announced in the last sales release." Cain added that investors should expect lower U.S. sales for 2018 but higher global sales.
Billed as a compact crossover, the Bolt is GM's foray into electric vehicles, touted as a potential rival to cars such as the Tesla Model 3 and the Nissan Leaf. Its base model lists a starting price of $37,495.
The Bolt is not to be confused with the Chevrolet Volt, a hybrid, which actually saw a year-over-year increase of nearly 23 percent in sales.
Why would GM purposely cut potential sales to US customers? 

Chevy Bolt
  • 3Q18 vs 3Q17 -- 6,710 in 2017 (3rd quarter); 3,949 in 2018 (3rd quarter) -- 41% drop for the third quarter, year-over-year
  • 9/18 vs 9/17 -- 2,632 in 2017 (September); 1,549 in 2018 (September) -- 41% drop in September, year-over-year
  • Model 3 -- huge jump, but to be expected; ramping up this year
  • Model S -- down 3Q year-over-year (7,575 vs 8,435)
  • Model X -- up 3Q year-over-year (8,050 vs 6,345)
Nissan Leaf:
  • 3Q18-- 4,027 vs 3Q17 -- 3,492 -- 15% increase 3Q year-over-year
  • September: 48% increase year-over-year (1,563 this September vs 1,055 last September)

Dow Jones Industrial Closes At An All-Time Record -- CNBC; Network Continues To Talk Down The Market -- October 2, 2018


Later, 9;11 p.m. CDT: Fed chair Jerome Powell -- US economy "may be too good to be true." Whatever that means. But it doesn't sound like recession. It sounds like a Fed trying to figure out "what they're missing." Low inflation and low unemployment confound the experts.

Original Post

Recession: all that talk about impending US recession? The tea leaves don't suggest it -- not by a long shot. The EU looks like the weak sister among the big four: US; Europe; Asia ex China; and China.

The Japan Nikkei: closes at a 27-year high.  The Nikkei is still 40% below the 1989 record high -- three decades lost in Japan.

The US market:

WTI: flirts with $76 during the day; drops back to $75 at close.

Weekly crude oil inventories, API data: smaller build than anticipate. A build of less than one million bbls vs analyst expectation of 1.132 million bbls, that is 1,132,000 bbls -- I would say the analysts were right on target: 907,000 vs 1,132,000 -- 

Back to the Bakken

Active rigs:

Active Rigs65573368190

Ten new permits:
  • Operators: Hess (7), MRO (3)
  • Fields: Big Butte (Mountrail), Killdeer (Dunn)
  • Comments: MRO has permits for a 3-well pad in lot 1 section 1-145-95; Hess has permits for a 7-well EN-Person/EN-Davenport pad in NENE 15-156-94; Hess has one producing well (#17838) in that drilling unit in 15/22-157-94 (a very mediocre well at best); MRO has four wells in drilling unit 1/12-145-95 (#17499; #17584; #21961; and, 21959 -- all moderately good wells; nothing remarkable about them).

Every Well Coming Off Confidential List In 4Q16 Has Been Completed; A Shout-Out To John D Rockefeller Who Saved The Whale -- October 2, 2018

PTI: WTI might close a bit lower today but it hit a 4-year intraday high, just barely missing $76 -- WTI hit an intra-day high of $75.91 here. 

Fracking. As far as "all but one producing," I went through the list quickly and could have missed a couple, but it certainly looks like 99.9% are producing; they were all completed.

Operators in North Dakota now have two years to complete a well once it is spud. Going back to 4Q16, every well that came off the confidential list in that quarter has been completed/fracked. All are producing except for one well that had a casing problem..

Crude oil, weekly inventories, API: pending.

The History Page

From twitter a few hours ago:

Now, from wiki:
Marathon Oil, the company's former parent, dates back to 1887 when several small oil companies in Ohio banded together to form The Ohio Oil Company.
In 1889, it was purchased by John D. Rockefeller's Standard Oil. It remained a part of Standard Oil until the Standard Oil Trust was broken in 1911.
In 1930, The Ohio Oil Company bought the Transcontinental Oil Company and established the "Marathon" brand name. In 1962, the company changed its name to "Marathon Oil Company". From 1982 until 2002, Marathon Oil was a subsidiary of U.S. Steel.
In 2005, Marathon Oil announced the spin-off of its Downstream, refining and marketing assets to a separate company called Marathon Petroleum Corporation.

The Market, Energy, And Political Page, Part 3, T+ 50 -- October 2, 2018

Market. Wow, I'm in a great mood. Who would have expected? WTI holds and the overall market continues to surge. Major indices are up (Russell 2000 is still struggling). But, wow, the Dow! Irrelevant but everyone watches it. What's the S&P 500 doing? Trading sideways but still green.

The Library Page

But this is why I'm in a great mood. Physics. Particle physics to be exact.

I don't understand a thing when it comes to quantum physics. I can't do the equations. I don't understand symmetry, much less super-symmetry. I forget Bell's Theorem. But the first step is knowing the language or the words, I would suppose. On the bike ride today, I could actually run through the "zoo": fermions and bosons; leptons and quarks; baryons and hadrons.

I wish there was a book that just went through "The Standard Model."

And then it appears I found it it. Atom Land by Jon Butterworth which I picked up a few days ago at the library is excellent -- I thought I might buy my own copy, but the "sailing" platform just doesn't work. But bits and pieces of the book are great.

But this looks like this might be a winner: Jeremy Bernstein's A Palette of Particles, c. 2013, Harvard College. Small, compact, and seems to get right to the point. We'll see.

Along the way, in my stack today:
The Quantum Labyrinth: How Richard Feynman and John Wheeler Revolutionized Time and Reality, Paul Halpern, c. 2017. The title is too long; should have been Quantum: Feynman and Wheeler.
Understanding The Great Gatsby, Dalton Gross and MaryJean Gross, c. 1998
So, four books.

I'm going on a cross-country road trip, wondering whether to take these four books with me. I never read as much as I want / plan when I take these cross-country trips but maybe ...

The Great Gatsby -- I know exactly the climax -- I'm curious if the authors agree. "Climax" is  not in the index. In the "Table of Contents"? Nope. It looks like the authors are putting the book in its historical context, not exactly what I was looking for. It's a timeless story and historical context is less important than the human dimension. Does anyone read Romeo and Juliet only after understanding the historical context? LOL. Of course not. Romeo and Juliet is timeless; no historical context needed.

Same with The Great Gatsby. Historical context completely unnecessary. A love story. The protagonist (?) learns two lessons. And those lessons are timeless. One lesson has to do with money. (Obvious.) The other lesson has to do with time (not obvious).

Enough for now.

The weather forecast says no rain, but the clouds are ominous; the humidity is very, very hight; and it smells like rain. And I'm on my bike, a long way from home. With several books in my backpack that is not particularly waterproof. What could possible go wrong?

The Market, Energy, And Political Page, Part 2, T+ 50 -- October 2, 2018

Exactly what happened in the Bakken at the height of the boom. From DallasNews:
America's fastest-growing source of energy has a power problem.
The Permian Basin, which produces almost 4 million barrels of oil a day, has expanded so quickly that suppliers of the electricity needed to keep wells running are struggling to keep up. The Delaware portion alone consumed the equivalent of 350 megawatts this summer, tripling the load from 2015. That's enough to power about 280,000 U.S. homes. And providers say the draw is likely to triple again by 2022.
While providers are rushing to build new power lines, it takes three to six years to get them up and working. In the meantime, drillers are bemoaning the reliability of the system and desperately seeking alternatives, exploring the use of solar and natural gas to fuel power-generating gear on-site.
It looks like Boone Pickens was just too early with regard to his wind farms in west Texas. Of course, he was moving that electricity to the large cities in east Texas, not to the oil fields. 

And more. Exactly what happened in the Bakken six years ago. Another story being carried by Yahoo!Finance:
The west Texas drillers that drove the shale revolution have overwhelmed the region's infrastructure with oil production -driving up costs, depressing regional oil prices and slowing the pace of growth.
The U.S. government continues to forecast the country's oil output rising to fresh record. But competition for limited resources in Texas is making it harder for shale producers to turn a profit and encouraging some to invest elsewhere.
Texas is home to the Permian Basin, the largest U.S. oil field and the center of the country's shale industry. In the past three years, production from the Permian has risen a whopping 1.5 million barrels per day (bpd) to 3.43 million bpd.
All that oil means pipelines from the shale patch are full, so producers are paying more to transport oil on trucks and rail cars. Shortages of labor, water and even the fuel used in fracking are driving up production costs.

The Market, Energy, And Political Page, T+ 50 -- October 2, 2018


Later, 9:17 a.m. CDT see earlier note below regarding Tesla. From Yahoo!Finance:
Tesla Inc announced record quarterly car production numbers on Tuesday but warned it was facing major problems with selling cars in China due to new tariffs that will force it to accelerate investment in its factory in Shanghai.
The California-based electric carmaker, emerging from several months of turmoil around its Chief Executive Elon Musk, confirmed numbers leaked to an industry news site on Monday that showed it produced roughly 80,000 cars in the third quarter.
Deliveries reached a record 83,500, above Wall Street estimates of 80,000 and including almost 56,000 of the Model 3 sedan whose ramp-up is widely seen as crucial to the company's drive to become profitable.
TSLA is down 1.6% in early trading.
Original Post
Pre-market trading:
  • Dow (irrelevant): down 55 points [in early trading turned positive but looks very, very mixed and unsettled today]
  • WTI: flat to slightly positive
  • NOG: up 7% yesterday; up another 3% in pre-market trading today
  • OAS: up about half a percent yesterday; up about a percent today
  • CVX: moving nicely
  • COP: down almost a percent today -- interesting
  • TSLA: slightly positive today after a huge day yesterday
  • GE: really, really irrelevant; up 2% in pre-market trading
False Precision

Earlier I posted:
Nothing to worry about -- Bloomberg -- Iranian sanctions will take, on a daily basis, 1.5 million barrels of the right kind of oil off the market, but OPEC is already pushing production -- 30,000 bbls  more than the month before ... 
Here's the lede to that Bloomberg story --
OPEC production rose last month as deepening losses in Iran due to looming U.S. sanctions were countered by other members.
The group’s 15 nations pumped 32.83 million barrels a day in September, 30,000 more than the month before, according to a Bloomberg survey of officials, analysts and ship-tracking data. Even though Iranian production fell by 140,000 barrels a day to 3.36 million -- the lowest since early 2016 -- Saudi Arabia, Angola and Libya offset the losses.
Iran’s decline is expected to accelerate once sanctions formally begin in November. Major buyers of the country’s crude have already started to diversify their supplies. India was said to plan no purchases of Iranian crude in November, according to officials at the largest state-run refiners. That followed similar moves by South Korea and Japan.
The Middle Eastern nation’s shipments of crude have fallen 1.1 million barrels a day, or 39 percent, since April, according to tanker tracking data compiled by Bloomberg. That outpaces the 11 percent drop in production over the same period. The tracked shipments exclude volumes held on tankers that remain close to Iran’s export terminals, after the nation resorted to storing some of its barrels at sea last month.
30,000 bopd. Give me a break. First of all, that's an estimate .. a Bloomberg survey of officials, analysts and ship-tracking data.

Oilprice, citing another source, said OPEC had increased production by 90,000 bbls month-over-month; feeble rise led to huge surge in WTI.

30,000 bbls: that's about one-half of a unit train. About 40 railroad tankers. DOT-111 tank cars.

VLCC can carry two million bbls of oil. 30,000 bbls is 1.5% of two million.

Total global supply / demand: 100 million bbls.
Turkey: Taking A Page From The Venezuelan Playbook

Erdogan urges Turks to report price hikes; says government will raid stores. From Reuters.


San Francisco: best gasoline prices in paradise -- $3.50 -- GasBuddy.

Car sales: will come out today. Apparently Tesla deliveries will blow the socks off doubters. Don't know where I read that. Maybe it was a dream. EV plug-in sales scorecard here.

The History Page

So, here we are again, Richard III of England.

From David Horspool's 2015 biography of Richard III.

We begin here: Richard III is king. He has most likely killed his nephews imprisoned in the tower -- the two sons of Edward IV -- to preclude any possibility one or the other should escape, and try to take back the crown. It is dark comedy to read apologists of Richard III to suggest there is no proof he harmed the two teenagers.

So, half of England supports Richard III, and half the country detests him. Those that detest him find common cause in having supported Edward IV and his sons. But they need a figure to rally around.

That figure is another Henry: Henry, Earl of Richmond.

Henry, Early of Richmond had not even been in England for the past twelve years. He was self-exiled in Brittany (northern France) for twelve years. Wow, twelve years.

It was truly amazing how flimsy his ties were to the throne.

We have to go all the way back to Henry VI.

Henry VI had a half-brother who died before Henry was even born.

That half-brother was Edmund Tudor -- this would be the patriarch, as it were, of the famous Tudor line, which most famously included Henry VIII and his daughter Elizabeth I. Edmund Tudor was the first early of Richmond.

So, we have this half-brother of Henry VI, Henry Tudor, who married Margaret Beaufort.

Margaret Beaufort was one of the handful of very powerful women at this time.

By the time Richard III had become Kind of England, Margaret Beaufort was re-married, to Lord Stanley.

Margaret Beaufort was a descendant of John Gaunt, the fourth son of Edward III -- pretty low on the list --fourth son -- and not only that, but by Edward III's mistress Katherine Swynford, whom Gaunt married only after their four children had been born.

The four bastards were "legitimated" in 1396-97 by Henry IV but it was only on the condition they were not in line of succession.

But the anti-Richard III folks were so desperate for anyone, they had little choice.

It helped their cause a bit when Henry, the second earl of Richmond who had been self-exiled in across the channel for twelve years said he would marry Edward's oldest daughter, Elizabeth of York, who was still in sanctuary with her mother in Westminster.

This illegitimate man (on so many levels), Henry Tudor and his wife Elizabeth of York eventually produced:
  • Arthur, prince of Wales
  • Margaret, Queen of Scots
  • Henry VIII, kind of England 
  • Mary, Queen of France
Not bad for an adulteress and a bastard father.

Elizabeth of York, the first Tudor queen and wife of Henry VII, herself had quite a pedigree and quite a story:
she was the daughter of Edward IV and niece of Richard III, and she married Henry in 1485, following the latter's victory at the Battle of Bosworth Field, which started the last phase of the Wars of the Roses. Together, she and Henry had a total of four sons, three of whom died before their father, leaving their brother, Henry VIII, to succeed his father as king
She was the sister of the two princes who disappeared, no doubt killed by Richard III:
The period of Henry VI's Readeption from October 1470 until April 1471 and the period between her father's death in 1483, when she was 17, and the making of peace between her mother and her uncle Richard were violent and anxious interludes in what was mostly a peaceful life. Her two brothers, the so-called "Princes in the Tower", disappeared, their fate uncertain.
Although declared illegitimate (her mother was Elizabeth Woodville) she was welcomed back to court by her uncle Richard III, along with all of her sisters.
As a Yorkist princess, the final victory of the Lancastrian faction in the War of the Roses may have seemed a further disaster, but Henry Tudor knew the importance of Yorkist support for his invasion and promised to marry her before he arrived in England; this was an important move; one which may well have contributed to hemorrhaging of Yorkist adherence to Richard III.  
 Note: "final victory of the Lancastrian faction" -- this was the penultimate battle of the War of Roses; the final battle was won by the Yorkists.

Enough for now.

Morning Note -- October 2, 2018

Nothing to worry about -- Bloomberg -- Iranian sanctions will take, on a daily basis, 1.5 million barrels of the right kind of oil off the market, but OPEC is already pushing production -- 30,000 bbls  more than the month before ...

Already at "$100-oil. See this post -- the one where Art Berman says to ignore the hype -- 
Canadian LNG


October 3, 2018: environmental update here.

Original Post

LNG: Shell approves $14 billion project -- WSJ -- data points --
  • the biggest LNG development to gain approval in years and the first for Canada
  • by the mid-2020s, it is expected to be able to deliver massive tankers of supercooled natural gas to demand centers in Asia
  • marks the end of a seven-year effort, blighted by weak prices that pushed back the final investment decision on the project by two years
  • Canada just imposed 10% tariff on US natural gas
  • bode poorly for US firms trying to decide whether to build LNG export terminals in the US 
But Bloomberg says its a $31 billion project-- Bloomberg via Rigzone --
Royal Dutch Shell Plc and its four partners have agreed to invest in a multibillion-dollar liquefied natural gas project in western Canada -- the largest new one of its kind in years that would carve out the fastest route to Asia for North American gas.
LNG Canada -- comprised of Shell, Malaysia’s Petroliam Nasional Bhd, Mitsubishi Corp., PetroChina Co. and Korea Gas Corp. -- is set to announce a final investment decision on the C$40 billion ($31 billion) project as early as Monday. The exact timing still hasn’t been decided. PetroChina and Korea Gas announced approvals of their share of the investment on Friday. The others partners declined to comment.
I assume the total project is $31 billion and Royal Dutch Shell will pony up $14 billion.
Back to the Bakken

One well coming off confidential list today -- Tuesday, October 2, 2018
  • 33450, conf, Equinor, Weisz 11-14 3H, Painted Woods, north of Williston, nice well;
Active rigs:

Active Rigs63573368190

RBN Energy: US shale exports find new pathways to China.
China exceeded Canada as the largest buyer of U.S. crude exports for the first time in February 2017 and in year-to-date 2018 has averaged 378 Mb/d versus Canada’s 347 Mb/d. Ramping up purchases from virtually nothing in 2015 to more than 500 Mb/d in June 2018 was no small feat — the logistics in getting that much oil across the world include multiple ship-to-ship transfers, several weeks at sea and a whole lot of negotiating between U.S. crude marketers and the major Chinese buyers: Unipec and PetroChina. That already complicated process has recently been made just a little more complicated by the escalating trade war rhetoric between the U.S. and China. In today’s blog, which launches our new Crude Voyager service, we explain how crude flows to China are evolving.