Wednesday, January 2, 2019

Part 5, T+57 -- January 2, 2018

Some of this is from Chesto over at The Boston Globe:

  • General Motors hits 200,000 benchmark for electric cars sold: This means that a trigger has been hit that will start a phase-out of the $7,500 federal tax credit for GM's electric-car buyers.
    • It will be interesting to see how the phaseout affects GM.
  • Tesla shares take a dive: The electric-car maker fell just shy of forecasts for how many vehicles it would deliver in the fourth quarter of 2018.
    • The phaseout for federal tax credits for Tesla has already begun.
    • Tesla misses Wall Street vehicle delivery estimates; shares tumble 
    • Tesla is cutting prices on all models by $2,000 to offset a reduction in federal tax credits; the $7,500 federal tax credit for Tesla cars was cut in half as of Tuesday
Apple issues rare earnings warning: The iPhone maker says revenue will fall short of expectations, in part because of an economic slowdown in China.

Year-End Summary -- Oil And Gas Permits In North Dakota -- Calendar Year 2018

Disclaimer: pretty much complete; I might become back and update.

Disclaimer: there will be typographical and factual errors.

Disclaimer: this was done quickly and not quadruple proofread.

Disclaimer: this will not agree with NDIC data, but it will be close. If this is important to you, go to the source.

Disclaimer: the number of permits by operator may not add up to total number of permits because it was hand-counted and my hands only have ten fingers (counting the thumbs); same with other data:
  • 1466 permits
    • from 34433 to 35898
  • Operators
    • Abraxas: 15
    • Armstrong Operating: 2
    • Ballard Petroleum:1
    • Behm: 1
    • BR: 15
    • Bruin: 34
    • CLR: 178
    • Cobra: 3
    • Crescent Point Energy: 13
    • Denbury: 1
    • Eagle Operating: 2
    • Enerplus: 81
    • EOG: 36
    • Equinor: 16
    • Hess: 151
    • Hunt Oil: 17
    • Iron Oil Operating: 3
    • Kraken: 77
    • Liberty Resources: 30
    • Lime Rock Resources: 21
    • Luff Exploration: 1
    • MRO: 70
    • Newfield: 29
    • Nine Point Energy: 41
    • NP Resources: 10
    • Oasis: 104
    • Petro Harvester: 6
    • Petro-Hunt: 16
    • Petroshale: 15
    • QEP: 20
    • Resonance Exploration: 3
    • Resource Energy: 8
    • RimRock: 10
    • Sinclair: 1
    • Slawson: 26
    • Southwestern Production: 4
    • True Oil: 2
    • Whiting: 182
    • Windridge: 4
    • WPX: 73
    • XTO: 131
    • Zavanna: 16
  • Counties
    • Williams: 420
    • Mountrail: 231
    • McKenzie: 518
    • Dunn: 232
  • Fields
    • Alger: 38
    • Alkali Creek: 34
    • Ambrose: 2
    • Antelope: 75
    • Ash Coulee: 4
    • Avoca: 14
    • Bailey: 5
    • Banks: 105
    • Baskin: 5
    • Bear Butte: 1
    • Bear Creek: 1
    • Bear Den: 1
    • Beaver Lodge: 6
    • Big Bend: 13
    • Big Butte: 7
    • Big Meadow: 1
    • Big Stone: 4
    • Bloombing Prairie 4
    • Blue Buttes: 34
    • Blue Ridge: 2
    • Bonetrail: 3
    • Brooklyn: 32
    • Burg: 2
    • Cabenet:1
    • Camp: 5
    • Capa: 17
    • Cedar Coulee: 9
    • Cedar Hills: 1
    • Charlson: 14
    • Chatfield: 1
    • Cherry Creek: 2
    • Clarks Creek: 1
    • Corinth: 6
    • Corral Creek: 2
    • Cottonwood: 2
    • Cfrazy Man Creek: 4
    • Dimmick Lake: 2
    • Dimond: 6
    • Dollar Joe: 5
    • Eagle Nest: 15
    • East Fork: 35
    • East Tioga: 5
    • Eightmile: 6
    • Eland: 1
    • Elidah: 5
    • Elk: 9
    • Ellisville: 10
    • Ellsworth: 1
    • Elm Tree: 12
    • Enget Lake: 11
    • Epping: 31
    • Fayette: 3
    • Foreman Butte: 6
    • Four Bears: 4
    • Ft Buford: 2
    • Glass Bluff: 6
    • Green Lake: 2
    • Grinnell: 11
    • Gros Ventre: 3
    • Haley: 1
    • Hamlet: 7
    • Hawkeye: 4
    • Haystack Butte: 25
    • Heart Butte: 32
    • Hofflund: 6
    • Jim Creek: 5
    • Juno: 1
    • Killdeer: 18
    • Kittleson Slough: 2
    • Larson: 1
    • Little Knife: 7
    • Little Tank: 1
    • Lone Tree Lake: 8
    • Lonesome: 1
    • Long Creek: 12
    • Lost Bridge: 9
    • Mandaree: 44
    • Manitou: 5
    • Manning: 3
    • Marmon: 1
    • McGregor: 3
    • McGregory Buttes: 29
    • Missouri Ridge: 2
    • Moccasin Creek: 4
    • Mondak: 1
    • Murphy Creek: 4
    • North Elkhorn Ranch: 3
    • North Fork: 34
    • Oakdale: 12
    • Oliver: 18
    • Painted Woods: 6
    • Parshall: 24
    • Patent Gate: 3
    • Pembroke: 39
    • Pershing: 7
    • Pleasant Valley: 8
    • Poe: 9
    • Portal: 10
    • Pronghorn: 9
    • Ragged Butte: 7
    • Rawson: 1
    • Red Wing Creek: 2
    • Reunion Bay: 30
    • Robinson Lake: 13
    • Rosebud: 2
    • Ross: 11
    • Sand Creek: 21
    • Sanish: 24
    • Sergis: 2
    • Sioux: 2
    • Siverston: 29
    • South Fork: 4
    • South Tobacco Garden: 3
    • Spotted Horn: 26
    • Spring Creek: 3
    • Springbrook:1
    • Squaw Creek: 18
    • Squires: 23
    • St Demetrius: 1
    • Stockyard Creek: 10
    • Todd: 11
    • Tracy Mountain: 4
    • Truax: 44
    • Tree Top: 6
    • Tyrone: 22
    • Van Hook: 27
    • Werner: 4
    • West Capa: 6
    • Wheelock: 4
    • White Earth: 2
    • Wildcat: 4
    • Williston: 1
    • Willow Creek: 8
    • Winner: 22
    • Wolf Bay: 10

CLR Reports A Huge Fancy Buttes Well; Fourteen Permits Renewed; Twelve New Permits -- January 2, 2018

Fake news from Russia. Pretty funny -- little lies from white Russia -- I'm shocked! Shocked, I say.  Link here 

  • Russia’s output averaged 11.16 million barrels a day last year
  • That’s a post-Soviet high, even amid cooperation with OPEC

Active rigs:

Active Rigs66523960171

Twelve new permits:
  • Operators: Slawson (5); WPX (4); CRL (3)
  • Fields: Big Bend (Mountrail); Squaw Creek (McKenzie); Indian Hill (McKenzie)
  • Comments: Slawson has permits for a 5-well Slasher/Tempest/Orca Federal pad in 15-152-92; WPX has permits for a 4-well Beaver pad in 23-149-94; and, CLR has permits just south of Williston for a 3-well Honolulu pad in 15-153-101;
Fourteen permits renewed:
  • Enerplus (9): nine "water fowl" permits in 20-148-93: Mallard, Daffy, Muscovy, Canvasback, Dewey, Scrooge, Pintail, Scaup, and Widgeon
  • CLR (5): four Polk Federal permits in McKenzie County and one Salem permit in Williams County
Four producing wells (DUCs) reported as completed:
  • 33836, 1,145, Abraxas, Yellowstone 6H, North Fork, t7/18; cum 90K 11/18; on line for only 16 days in 11/18; #18708 -- no jump in production;
  • 33835, 1,360, Abraxas, Yellowstone 5H, North Fork, t8/18; cum 132K 11/18; #18708 -- no jump in production;;
  • 33727, 2,232, CLR, Norway 3-5H, Fancy Buttes, t11/18; cum 19K 11/18; only on line for about 9 days; #19380 -- nice jump in production;
  • 33728, 2,127, CLR, Norway 2-5H2, Fancy Buttes, t11/18; cum 27K 11/18; 18,384 K over 6 days extrapolates to 91,920 bbls of crude oil; #19380 -- nice jump in production;

Postal Rates Holding Relatively Steady? -- January 2, 2019

Link here.

First Class Mail Letters
  • The First Class Mail letter (1 oz.) rate for postage purchased at the Post Office is increasing by five cents to $0.55 from $0.50.
  • Each additional ounce for a First Class Mail letter will cost an extra $0.15 (a decrease from $0.21 in 2018).
  • First Class Mail Flats/Large Envelope rates are not increasing in 2019, remaining at $1.00 (1 oz.), with additional ounces costing $0.15.
  • Postcard rates are also not increasing in 2019, remaining at $0.35.
  • Customers who print postage online (via, the Metered Mail rate will now be a 5 cent discount compared to the Post Office price with rates increasing to $0.50 in 2019 from $0.47 currently.
  • Each additional ounce will cost an extra $0.15 in 2019, a decrease from $0.21 currently.
  • The five cent discount for online postage on a one-ounce First Class Mail letter represents a savings of 9% for consumers and small business owners. costs only $17.99 / month. 

What was it that Shakespeare wrote? Something smells rotten in Denmark. Something to that effect.

The "Red Queen" Argument All Over Again -- January 2, 2019

Fracking has a problem -- WSJ -- link here. It's the "Red Queen" argument all over again. Among many other arguments. Additional comments here.

By the way, this is why this blog is not an investment site. Do not make any investment, financial, job, travel, or relationship decision based on anything you read here or think you may have read here.

The gist of the article: operators over-estimated their projections when talking to investors. Shocking! Shocking, I say!

Meanwhile, from the NDIC: historical monthly oil production statistic.

The entire North Dakota oil history. Oil was discovered in North Dakota in 1951. Data is available for every month, but I simply took the highest production month for any given year. Production routinely dropped below 30 bbls/well/day in the mid-1990s.

Daily Oil Per Well (bbls)

Part 4, T+57-- January 2, 2018

Market should soar! New congress -- budget rules are "out the windows." At least that is what is now being reported.

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

Uber for retirees: from cinemablend. I was waiting to see how this movie would "do" at the box office. We enjoyed it. It's all about how an old person like myself, who loves cross-country road trips and has no criminal record, can make a gazillion dollars for one's friends and family by transporting illegal contraband, specifically cocaine, across the country. When finally caught, the "mule" can live out his days in a low-security prison with no cares or responsibilities with free medical care for the rest of his life, and thus no burden on his family. Based on a true story. It completely changed my attitude on drugs and open borders.

The Book Page

What a Bunch of Crap

Sapiens: A Brief History of Humankind, Yuval Noah Harari, c. 2015. First published in Hebrew in Israel in 2011. A New York Times bestseller. Recommended by everyone, including Bill Gates and Barack Obama. Author: a PhD in history from the University of Oxford.

A few weeks ago our oldest granddaughter was telling me how one of her teachers was talking about the "agricultural revolution" as a fantasy and that, in fact, the "agricultural revolution" left humankind more worse-off than what they had as foragers and hunter-gatherers. I thought the instructor was an idiot, but I didn't say anything negative. I continued to listen to Arianna's theses and arguments.

And then here it, almost verbatim, from Sapiens by Harari, pp. 78+, exactly what Arianna was saying. I am not convinced. But I am thrilled that this suggests to me that her instructor is well-read, and, in fact, has probably read this book and this is where he/she is getting some of his/her ideas.

It also means this is a great resource book for Arianna for this particular class and this particular author. Despite the fact that the book is pathetic; a bunch of crap. This is the author's theme, found on page 415 in the afterword:
Unfortunately, the Sapiens regime on earth has so far produced little that we can be proud of. We have mastered our surroundings, increased food production, built cities, established empires and created far-flung trade networks. But did we decrease the amount of suffering in the world? Time and again, massive increases in human power did not necessarily improve the well-being of individual Sapiens, and usually caused immense misery to other animals.
It's a great resource book as long as Arianna is capable of critical thinking.

Again, from the author: Unfortunately, the Sapiens regime on earth has so far produced little that we can be proud of.

I had my wife read that passage; she agreed. I must be missing something. 

Let's see:
  • Carnegie libraries across the US
  • vaccines eradicated smallpox, tetanus, and polio
  • art by Monet
  • Tesla
  • the Bible, the Odyssey, the Iliad, the Aenied, Shakespeare
  • the iPhone 
  • martinis 
  • the Kentucky Derby
  • Olga Kern and the Santa Fe Orchestra
  • life expectancy and quality of life
  • Neil Armstrong 
  • the Rolls Royce
  • We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness
  • cowboy boots and cowboy hats
  • equal rights for women
This shows me the lack of critical analysis by Barack Obama and Bill Gates and others who recommended this book. Of if I'm missing something, why they would recommend this?  I guess if you are an elitist ...

... by the way, I wonder whether the author would say the #1 cause of death worldwide is one of the good or bad things related to Sapiens?
Oil Power and War: A Dark History, Mattheiu Auzanneau, c. 2015, translated from the French. The jacket says it is "the new definitive work on oil and its historic significance, supplanting even Daniel Yergin's renowned The Prize." It is clearly written by an individual that is anti-fossil fuel; anti-Big Oil; and, a peak oil theorist.

I was quite curious to see what he had written on the shale revolution. It's a very, very good section and was very interesting to read. But he is completely wrong on tight oil/unconventional oil/shale oil. From pp. 522+:
The economic viability of fracturing, or fracking, tight hydrocarbons, like its ecological impact, is the source of much debate.
By its nature, fracking often calls for much more drilling that conventional oil or gas to obtain an equivalent production in the long run. It only releases hydrocarbons through restrained passageways. Tight oil and gas production usually collapses after a few months (or a couple of years in the best cases) and the well becomes a "stripper," a marginal well that isn't very productive.
To provide a high extraction level, it is therefore necessary to continuously drill new wells. Many experts critical of fracking see this as a fatal economic vulnerability. But the production of gas and oil from tight resources has not stopped escalating, advancing in great strides toward, and exceeding peaks that have been considered irreversible since the 1970s. Perhaps the oil industry is simply in the process of losing its exceptional status, of becoming a normal industry, clamoring, like the coal mines, for a constant investment flow in order to maintain production, whereas drilling conventional oil guaranteed a fortune for many years.
Readers of the blog, and those following the Bakken closely, are seeing something completely different. Oil companies are drilling way fewer wells in the Bakken than eleven years ago but are setting higher production records every year. In one respect the author is correct: perhaps the oil industry is simply in the process of losing its exceptional status, of becoming a normal industry ... that's exactly where the Bakken is now -- as predicted by Rolfstad many years ago -- that the Bakken is now in its manufacturing phase, and like an automobile company needs continued cash flow to build automobiles. What's so unusual about that?

If you hate Big Oil; if you are a fan of Peak Oil -- a theory that is obviously no longer viable; if you believe that solar and wind energy is free, and can completely supplant fossil fuel, this is the book for you.

Part 3, T+57-- January 2, 2019

Great example of a nonsense article: Arab energy firms set to boost borrowing after prices crashed. If the link breaks, you aren't missing a thing. 

Global warming? Global revolt -- The Daily Caller
  • 2018 saw a global revolt against policies aimed at fighting global warming 
  • Australia, Canada, France and the U.S. have all seen push back against global warming policies
  • That included weeks of riots in France against planned carbon tax increases 
EVs: they must be reading the blog. The WSJ editorial staff feels the same way I do about EV subsidies -- a nice transfer of wealth from the poor to the rich. 

New Mexico: more snow than "ever" according to some of the locals. Okay, I exaggerate. Most snow in four years. We did not see the Kennedy clan in Angel Fire; they were most likely in Jackson Hole or Vail. 

109 East Palace

Part 2, T+57 -- January 2, 2019

Natural gas: a reader provided a nice analysis of the US natural gas situation following last week's natural gas withdrawal report. It was a bit too long for the blog, but I think I was able to provide the important data points. Bottom line: as long as the northeast has a "moderately warm" winter, everything will be fine. See data points and update here 


Disconnect: what network and local evening news report and what I see in my daily life.

Disconnect: what I see on social media and what I enjoy in my daily life.

Great to be back home after two weeks of traveling. Two different movies -- at one of several resorts where we stayed during the two-week vacation, I thought the service was lousy; my wife thought it was the best she had ever seen. I never told her my thoughts. It was simply two different movies we were watching. Same with everything else, it seems.

Hockey: if you like great human-interest stories and/or hockey, great article in The Grand Forks Herald. Sent to me by a reader. 

Bowl games: I was traveling January 1, 2019, so I did not see any of the college bowl games but looking at the scores, it looks like I didn't miss anything. Exciting? Hardly, The semi-final championship series were blowouts. The other bowl games, pretty much unidentifiable teams. Gasparilla Bowl?
  • Clemson, 30; Notre Dame, 3 -- national championship semi-final
  • Alabama, 45; Oklahoma, 34 -- national championship semi-final
  • Utah State, 52; North Texas, 13
  • Appalachian State, 45; Middle Tennessee, 13
  • UAB, 37; Northern Illinois, 13
  • Ohio, 27; San Diego State, 0
  • Gasparilla Bowl, 38 - 20
  • Famous Idaho Potato Bowl, 49 - 18
  • Armed Forces Bowl, 70 - 14 -- did anyone even stick around for the second half (second quarter?)
Books: a half-dozen more books to read that I picked up over the Christmas break. Right now: 109 East Palace: Robert Oppenheimer and the Secret City of Los Alamos, Jennet Conant, c. 2005. Jennet Conant is the granddaughter of James B. Conant, the administrator of "Los Alamos" during the Manhattan Project. She is a former journalist who has written profiles for Vanity Fair, Esquire, GQ, Newsweek, and The New York Times.

Regrets: the mot common word I saw used when folks connected with the Manhattan Project reminisced on that period --
  • Einstein: "regretted" that he ever sent "that letter" to FDR; I guess he preferred that the Russians or the Germans would have won the war; naive
  • many physicists: "regretted" that they were involved with the Manhattan Project
  • Oppenheimer: did not "regret" what he accomplished what at Los Alamos; "regretted" the direction nuclear weaponry took after WWII

T+57 -- January 2, 2019

Nuked: Bill Gates says it's unlikely he will be unable to combat global warming due to US regulations enacted well before President Trump became president.

Well said: My interpretation of [any] article [on global warming]: Scientists have no reliable temperature data history and thus there is no way to know whether or not the planet is warming.-- Scott Adams

Cheap: unleaded, regular gasoline -- down to $1.74/gallon in much of north Texas. Diesel was trending as much as $1.00/gallon more than gasoline across New Mexico, Texas.

Distant vision: US EV adoption. Talk about EVs all you want; ain't gonna happen in my investing lifetime. Same with sending people to Mars.

Staggering: (compare with France)


Notes to the Granddaughters

We had a great two weeks or so skiing and exploring northeastern New Mexico. Incredible.

If you find Colorado too expensive, and/or Europe too far away for skiing -- head for the "Enchanted Circle," New Mexico, if you have children learning to ski. The green and blue slopes are perfect. The black slopes will challenge the best skiers. At Angel Fire? The Lodge. 

Sophia napping at Starbucks in historic Santa Fe.

Random Data Points For The Bakken -- January 2, 2019

Disclaimer: this was done quickly. There will be factual and typographical errors. If this information is important to you, go to the source. My data will differ from the official NDIC data for various reasons, but it will be fairly close to what the NDIC is reporting.

Number of wells coming off confidential list by quarter:


This is what the Bakken looks like to me right now (end of 2018), some data points:
  • about 250 wells come off the confidential list each quarter (2018) -- compare to 600 back in 2014
  • about 2,000 permits each calendar year (I'll check that later)
  • about 1,000 wells completed each year (2018)
  • about 2,000 non-producing wells sit idle (wells that have been drilled to depth; 1,000 not fracked; 1,000 producers but have come off line for operational reasons)
  • about three wells come off the confidential list each day: two DUCs; one completed
  • companies taking advantage of 2-year confidential period/completion deadline
  • standard well, unchanged: two miles down; two miles horizontal lateral
  • targets of choice: middle Bakken and Three Forks first bench (ratio: 5:1)
  • EUR, tier 1: 1.5 million bbls crude oil; about 85% crude oil; 15% natural gas
  • production, first year: 100K and trending toward 250K bbls crude oil in tier 1
  • fracking standard: 50 stages; 8 - 10 million lbs sand; most operators not using ceramic
  • TF1 requires slightly less sand than MB
  • drilling unit, standard: 1280 acres
  • talk of longer horizontals, but I don't see that happening (some exceptions)
  • larger drilling units are being seen but only to "mop up" up "stranded/orphaned" oil
  • an increase in the number of increased density projects seen and some density projects are staggering; for example, Petro-Shale, case #27023, Bear Den-Bakken, 11 wells on an existing 640-acre unit, 25-149-96; McKenzie -- just one example of many
  • huge dollar investment in NG pipeline and processing plants forecast; I think I saw a $3 billion figure for NG investment in CY 2019 and this is on top of huge investment in prior years
  • Legacy Fund deposits around $50 million/month; can be quite variable
The blog:


We've talked about this before. I don't plan to re-open the discussion; it is what it is. Here's the link. Here's the graph: