Six Wells Coming Off Confidential List Today -- September 12, 2019

First things first: Starbucks. Breaking news! You know those little green plastic "stopper-sticks" that Starbucks puts in your plastic lid? Once they run out, they will not re-stock. Starbucks is phasing out these little green plastic things. This looks like an opportunity for a Chinese entrepreneur! LOL! The reason they were phased out is because no one at Starbucks could come up with a "real" name for these things, and none of the bean counters (pun intended) knew where to place them as a line item on the quarterly financial statements. Baleen whales had been using these little things to floss their baleen. 4Q19 earnings guidance jumped 14.5% on this development.

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, career, or relationship decision based on what you read here or what you think you may have read here.

Politics: last poll data before tonight's 10-dwarf Democrat debate (10-DDD) in Texas.

Oil exports: US "briefly" became the world's #1 "oil" exporter, beating out Saudi Arabia for bragging rights. In June, 2019, US shipped 9 million bopd crude oil and oil products; Saudi cut back on exports trying to maintain prices. Definition of "crude and petroleum products." I think most interesting is the delta between "crude oil" shipments (3 million bbls) and total crude oil and petroleum productions (9 million bbls) -- that's a lot of refinery throughput. Story everywhere; here's one link.

The expansion in America’s exports in June was helped by a surge in crude-oil shipments to more than 3 million barrels a day, the IEA said.

At the time, Saudi Arabia was cutting its exports as part of the OPEC+ agreement, while Russian flows were constrained by the Druzhba pipeline crisis.

The Saudis reclaimed the top exporter’s spot in July and August as hurricanes disrupted U.S. production and the trade dispute “made it more difficult for shale shipments to find markets,” the IEA said.

The tussle for the No. 1 slot could remain tight in the months ahead. As Saudi Arabia continues to curb production, the IEA said America’s crude exports could rise by a further 33% from June levels to as much as 4 million barrels a day as new export infrastructure gets built in the fourth quarter of this year.

Natural gas: primary energy source in 2026. Data points:

• global oil demand will peak in the mid-2020s and gas demand will keep rising to 2033 
• oil and gas will still meet 46 percent of world energy demand in 2050
• unconventional onshore gas will increase from 2019 through to the end of the forecast period, growing by 68 percent from 2017 production levels

Natural gas: weekly EIA data out at 9:30 a.m. CT today, link here.

Re-posting: this Pemex story was posted yesterday, but either I missed it or it was not made clear that the $5 billion for Pemex was coming from the Mexican government. The oil and gas sector should be a revenue stream for the country of Mexico, not the other way around.

PEMEX: lined up $5 billion in re-financing; teetering on edge of junk credit rating. Until re-financing had $15 billion of debt coming due over next 12 months. Data points:

• has failed to stem a more than decade-long decline in oil output
• finances have become increasingly precarious
• folks skeptical that socialist AMLO can turn things around
• oil production has fallen every years for the past 14 years
• oil production less than half of what it once was

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Back to the Bakken

Next Director's Cut: Monday, September 16, 2019, 3:00 p.m.

Wells coming of the confidential list today -- Thursday, September 12, 2019: 39 for the month; 171 for the quarter:

• 35977, 2,106, Newfield, Sturgeon 150-99-18-19-5H, South Tobacco Garden, t7/19; cum 25K over 20 days; 
• 35709, 658, Liberty Resources, UT 158-93-12-1-4MBH, Enget Lake, t3/19; cum 55K 7/19;
• 35519, SI/NC, Hess, EN-Davenport-LE-156-94-1003H-1, Big Butte, no production data,
• 34717, 1,330, Oasis, Mildred Nelson 5298 12-25W 2B, Elidah, t4/19; cum 160K 7/19;
• 34716, 1,070, Oasis, Mildred Nelson 5298 12-25W 3T, Elidah, t4/19; cum 117K 7/19;
• 34715, 892, Oasis, Mildred Nelson 5298 12-25W 4B, Elidah, t4/19; cum 135K 7/19;

Active rigs:

$55.20	9/12/2019	09/12/2018	09/12/2017	09/12/2016	09/12/2015
Active Rigs	64	66	56	37	69

RBN Energy: Limetree Bay restart shores up North American refinery stack.

Limetree Bay Refining plans to restart a former Hovensa plant in St. Croix, U.S. Virgin Islands, at the end of 2019. The refinery’s initial processing capacity of 200 Mb/d represents a significant addition to the North American stack, helping to replace the loss this year of the 335-Mb/d Philadelphia Energy Solutions plant in Pennsylvania.

If it opens on time before the year’s end, Limetree will be well-positioned to fill a void in Caribbean refining that’s been left by Venezuela’s collapse as well as the International Maritime Organization’s (IMO) 2020 changes to the bunker fuel market. The plant’s location in the middle of world trade routes conveys some advantage, but it must compete with U.S. Gulf Coast refineries to supply regional markets. While higher input costs compared to U.S. rivals will dampen margins, a tolling agreement with BP could insulate Limetree from market exposure. Today, in the first of a two-part blog series, we review the operations and potential product market for the refinery.