EVs? Oh-Oh -- May 11, 2019

Updates

May 12, 2019: Illinois looking to charge EV owners $1,000 to pay their fair share for using state highways. Chicago Tribune.  Corroborates my feeling that no one takes global warming seriously. IF the world was going to end in 10 years (Beto) or 12 years (Occasional-Cortex) wouldn't internal combustion engines be banned if that was the only way to save the earth? Just asking. But the earth coming to an end in ten years seems to be kind of a "big f'in deal," as Joe Biden would say.


May 12, 2019: after looking at the vehicle sales data this past month, it would be nice to see a better analysis of what's going on. Car sales were off across the board (some exceptions); EVs get a lot of ink but not much happening there except that Tesla is the 800-lb gorilla in the world of lithium. But the fact that car sales are down across the board is interesting. Five things come to mind:

• sticker shock
• buying experience (going to the dentist might be more terrifying)
• sales/business model
• leases
• quality/longer-lasting vehicles

I don't buy into "younger generations not driving as much as older generations."
 

Original Post

EV sales.

In all the commotion this past week, I forgot to check monthly EV sales for the month of April.

When I saw them, I thought "oh-oh." Not good.

I wondered if maybe something was going on with Chevrolet Volt. Google search.

Oh-oh.

I can't wait to see how the EV-enthusiasts spin this one.

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Tesla

Meanwhile, a quick look at US Tesla sales seemed mixed -- at least to me. So, the same google search. It was amazing how far one had to scroll down to find any "US Tesla story." Many stories of how well the Tesla was doing in Europe -- I didn't read the stories but I can bet sales correlate 100% with tax incentives.

So, what about Tesla sales in the US where tax incentives for Tesla are ending. There is no talk in Congress (at least that is being talked about in the mainstream press) about extending tax incentives for Tesla. My hunch is that the GM - Ford - Chrysler won't send lobbyists to Congress advocating for extending credits for Tesla.

I couldn't find anything in the first four pages of google hits on US Tesla sales in April, 2019. The stories were all about European sales. The only thing relevant was this CNN headline for US Tesla sales for 1Q19. Previously reported but this was the first US-Tesla sales story in today's search. 

Let's see if we can find something on April's sales. Nope, not in the first four pages, and I have places to be.

A Cup Half-Full; Pelosi's Choice -- May 11, 2019

The transition might be a bit rough -- transitions always are -- but the southern surge, or Pelosi's Choice as some call it -- is going to be a huge economic boost for the US over the next ten years. There will be a huge transfer of wealth and huge amounts of government spending at the federal and state level that will flow through the system. The new immigrants all need to eat; they all need housing. Our federal, state, and local governments won't let them remain homeless.

Conservatively, each family member in the southern surge will need $5,000/year on which to live. The first year the funding will be easily available -- relatively easily available compared to each additional year. The families won't be hiding that money in mattresses or putting it in savings accounts. They will be spending it. It will flow through the economy. One can start to think about investing opportunities.

The numbers coming across the border are incredible. Apparently 1% of two Central American countries entered the US last year illegally. I assume the numbers will be greater for at least one more year.

From LMTonline, this headline: border detention cells in Texas are so overcrowded that the US is using aircraft to move migrants.

That headline is not quite right. The US is not using aircraft to move migrants because the detention centers are so overcrowded. It's because the US has run out of .... drum roll ... buses. Are you kidding? Was there even a nationwide call for buses? You mean the US is so well endowed financially the country has more air seats than bus seats. I find that simply incredible. What a great country.

Overcrowding at Border Patrol stations in South Texas has become so acute in recent days that U.S. authorities have taken the rare step of using aircraft to relocate migrants to other areas of the border simply to begin processing them, according to three Homeland Security officials.

The first flight left McAllen, Texas, on Friday, transferring detainees to Border Patrol facilities in Del Rio, Texas. There are daily flights scheduled for the next several days, with two planned for Tuesday, according to officials who spoke on the condition of anonymity to describe the operations.

What a hoot for these families who probably never dreamed of flying anywhere. I assume they get an in-flight snack.

The US government is taking a page out of Amazon's playbook. When you positively, absolutely have to get something (someone, in this case) somewhere overnight, use airplanes.

Speaking of Amazon.

Just the first of many, madeinAlabama:

Amazon’s 855,000-square-foot facility is being constructed on 133 acres of property formerly owned by U.S. Steel off Powder Plant Road in Bessemer, located just minutes away from Birmingham. Total investment in the project is $325 million.

Amazon officials joined Governor Kay Ivey and leaders from Jefferson County and the City of Bessemer at a ceremonial groundbreaking this afternoon at the site, where construction is already under way on the facility.

Ryan Lively, operations manager for Amazon, said the company’s first Alabama fulfillment center will house the latest technology, including state-of-the-art robotics, to help the 1,500 workers pick, pack and ship items such as books, toys, health care products and electronics items to customers in the Southeast and beyond.

Jeff Bezos must see the same cup that I do: half full, and getting fuller.

What's Next For Chevron? May 11, 2019

What's next for Chevron -- after Anadarko?

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 think you may have read here.

When you look at the market caps below, remember that OXY agreed to pay upwards of $60 billion for Anadarko, and that $10 billion of that $60 billion was coming from Warren Buffett. Chevron had made a $30-billion bid.

[By the way, the OXY-Anadarko deal is yet to play out.]

Investopedia suggests the following that Chevron could consider:

• Concho Resources: $21 billion
• Parsley Energy: $6 billion
• Pioneer Natural Resources: $25 billion
• Climarex Energy: $7 billion

Not mentioned:

• Apache: $12 billion
• EOG: $55 billion
• CLR: $15 billion 

No one likes the Bakken when it comes to discussing M&A, but to the best of my knowledge, of the three US majors, only Chevron does not participate in the Bakken, unless there is some subsidiary of which I am unaware (which is very, very possible). In the Bakken, Exxon has XTO; and, COP, has BR.

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Frackers Now Showing Free Cash Flow

Link here.

Then there’s ConocoPhillips, which is active in the Eagle Ford, Bakken and Permian Basin. In recent years, COP has been the king of cash flow among the pure oil and gas producers.

In the past ten years, ConocoPhillips has generated positive FCF seven times. They took a hit like most other producers in 2015, but the company responded with significant belt-tightening. The firm slashed its dividend, cut capital spending, and sold a number of assets. The result has been a steady improvement in the company’s cash flow.

In 2017 and 2018, ConocoPhillips generated $7.3 billion and $6.3 billion of FCF, respectively. The number fell in 2018 due to the divestment of assets. To put these numbers in perspective, only one other publicly traded oil and gas producer — Canadian Natural Resources — recorded more than $1 billion of FCF in either of those years.

Among the ten largest oil and gas producers half have pretty consistently generated positive FCF since coming out of the 2014-2015 downturn. Joining ConocoPhillips in this group are EOG Resources, Canadian Natural Resources, Continental Resources, and Apache.

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The Book Page

1775: A Good Year for Revolution, Kevin Phillips, c. 2012

The four colonies that made up the vanguard of the revolution: Massachusetts, Virginia, Connecticut, and South Carolina.

North Carolina deserves special mention.

Connecticut played a particularly important role:

... its chief executive, ardent Patriot Jonathan Trumbull, already in office for six years, served eight more through 1783. The colony was uniquely positioned between the three major hot spots of 1775 -- Boston, New York City, and Lake Champlain -- and was uniquely able to raise and send regiments where needed. Trumbull, who worked closely with George Washington, deserves more attention that he has ever received. 

And this:

The Chesapeake region, centered on the thirteen colonies' largest estuary, had a large Loyalist population and might have been an effective British invasion route. Chapter 17 looks at who made that case and how British planners, literally and figuratively, missed the boat in Chesapeake Bay.

Delmarva: latter-day shorthand for the peninsula shared by portions of Delaware, Maryland, and Virginia.

This:

Three times in 1775 Congress urged the individual colonies, emphasizing those along the Chesapeake, to ship their most salable produce only to buyers committed to paying with utter necessities: munitions, weaponry, medicine, and, salt. Paper money was distinctly less welcome in payment. The foreign sellers having the most gunpowder and arms available -- France and Holland were precisely those anxious for tobacco in return.

Chesapeake: from the Algonquin K'che-sepiack, "the Great Salt Water," although only the lower bay was briny.

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

If You Were A Sailboat, Katie Melua

DFW Notes -- May 11, 2019

DFW -- Dallas - Ft Worth -- International Airport -- North Texas.

1. Wow, the local weathermen/women, again, underestimated all the rain we would be getting. The forecast last night -- less than 12 hours ago -- was for small chance of some rain in our local area. It's a deluge. But at least we know what the temperature of the earth will be to the nearest tenth degree one hundred years from now.

2. I cannot overstate what an incredible job TxDOT, contractors, workers, etc., are doing with all the road construction on the west, north, and east side of the DFW airport. It is absolutely incredible. One of three best-kept secrets on Texas roadways: the "Texas turnarounds" on divided highways. I don't recall seeing these "turnarounds" anywhere else in the country.

3. Beijing may have nine million bicycles but DFW is close to having nine million scooters. LOL.

Nine Million Bicycles, Katie Melua
4. I was happy to see that Alexa knows Katie Melua. I love how Alexa pronounces Katie's last name.

5. Crawfish -- and, yes, it's crawfish in north Texas -- season probably lasts for three more weeks. Personal goal: crawfish boil at least once a week.

6. Best random gift to give Schwab broker: Copeland's cheesecake. Alternate: Cheesecake Factory cheesecake. Prices are about the same. Copeland's: smaller portions and a much, much smaller selection.

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The Book Page

The Girl Who Never Read Noam Chomsky, first novel by Jana Casale. c. 2018; light reading; looks fun; enjoyed the first few chapters; at the right place -- the beach? -- it might be a fun book to finish.

Lone Star Dinosaurs, Louis Jacobs with original artwork by Karen Carr, c. 1995. The dinosaurs of Texas. Well wort a read for Texans interested in dinosaurs. Not sure if the phylogeny of the book holds up.

Takeaway Issues Re-Emerging -- May 11, 2019

Another story I completely missed this past week. From Geoff Simon's top ND energy stories:

Bigger Wells Cause ND Production Surge

Pipeline Capacity Shortage Begins to Re-emerge

Most oil industry observers expect North Dakota oil production will continue to grow, but it could happen sooner than they expect, so midstream companies are being urged to step up plans to build additional pipeline and processing infrastructure to handle the surge.

Justin Kringstad, director or the ND Pipeline Authority, said technological advances to recover additional oil have been growing at a pace faster than anyone predicted. During an interview on the radio program, What's on Your Mind, Kringstad said newly completed wells have established new records for initial production.

Click here to listen to Kringstad's comments.

Kringstad said additional gains in productivity will require infrastructure to expand as well.

Click here to listen to Kringstad's comments.

Kringstad said market forces and geological or environmental barriers limit the transportation options available to North Dakota producers. He said additional production will likely travel south to the Gulf.

Click here to listen to Kringstad's comments.

Click here and advance to the 2:25 mark to listen to the full interview with Kringstad.

CO2 EOR Resulting In 60% Recovery -- Huge Story -- May 11, 2019

Updates

May 12, 2019: see first comment -- The CO2 project that Denbury is doing in far sw ND and se Montana is showing the same promise. Wells that were pretty much dead, only producing a few barrels a day, are now producing 100 barrels+ per day with CO2 injection.

Original Post 

Peak oil? What peak oil? CO2 EOR re-vitalizes a dying field. 

This is a huge story. I completely missed it. Geoff Simon caught it and posted it in his top ND energy stories. Data points:

• CO2 EOR
• source: from the Dakota Gasification Company, Beulah, ND
• operators recovering 60% of oil in the formation near Weyburn, Saskatchewan
• most interesting: why CO2 injection works -- it's not what we think
• CO2 EOR added 25 years of life to the field
• I don't know for sure, but this sounds like what we call the Madison in North Dakota (Midale-Nesson)

Wiki: the world's largest CCAS project;

• current production consists primarily of medium-gravity crude oil with a low gas-to-oil ratio

From Geoff Simon this week: Recovery Rates Near 60% at Weyburn

Canadian oil producers using carbon dioxide piped from the Dakota Gasification Company's plant near Beulah say they are recovering up to 60 percent of oil in the formation near Weyburn, Saskatchewan.

Joel Armstrong, VP of Production and Operations for Whitecap Resources, said oil production in the Weyburn field began in 1954 and peaked at around 45,000 barrels per day in the 1960s, before dropping to under 10,000 bbl/day in the 1980s. Armstrong said horizontal drilling help revitalize the field in the 1990s, but he said it really took off after DGC completed the CO2 pipeline in 2000.

Click here to listen to Armstrong's comments.

Armstrong said the injection of CO2 into the formation helps build pressure to move oil to the wellbore, but it primarily works by mixing with the oil to make it flow more easily.

Click here to listen to Armstrong's comments.

Armstrong said DGC is still the primary source of CO2 for the project, but it now has a secondary supply coming from the CO2-capture project at the Boundary Dam coal plant near Estevan, SK. He said since its establishment, the field has stored more than 30 million tons of carbon dioxide.

Click here to read more about the Weyburn-Midale CO2 project. Click here to read a paper on CO2 enhanced oil recovery from the National Energy Technology Laboratory.

The Weyburn CO2 project:

The project was launched in 2000 by the Government of Canada, the Government of Saskatchewan, Cenovus Energy and the Petroleum Technology Research Centre (PTRC) in Regina, Saskatchewan.

The eight-year project, part of the IEA Greenhouse Gas R&D Programme, was extended to 11 years at a cost of $85 million. It is the largest full-scale CCS field study ever conducted and results include studying mile-deep seals that securely contain the CO2 reservoir, CO2 plume movement, and the monitoring of permanent storage.

The project has attracted 16 sponsors from government and industry that include IEA, Alberta Innovates, Saskatchewan Ministry of Energy and Resources, Japan’s Research Institute of Innovative Technology for the Earth, and 10 industry sponsors from Canada, the US, the Middle East, and Europe.

In July 2010, the US Department of Energy (DoE) and Natural Resources Canada committed $5.2 million to enable the project to conclude in 2011. The DoE provided $3 million and the Government of Canada provided $2.2 million.

Week 19: May 5, 2019 -- May 11, 2019

Top international story: Venezuela -- North Korea -- Iran on front burner; tea leaves suggest Mexico will be in similar straits in less than two years

Top international energy story: US shale now the second least expensive oil in the world

Top national non-energy story: What fresh hell is this? 

Top national energy story: California running out of gasoline? 

Geoff Simon's top North Dakota energy stories:

• census: oil region to gain legislative seats
• Dickinson: another wealthy community rejects school bond
• bigger wells are resulting in ND production surge
• pipeline capacity shortage begins to re-emerge
• recovery rates near 60% at Weyburn
• Project Tundra gains momentum
• Davis Refinery model to spread to other states as progress in ND continues
• large wind farm on 44,000-acre site northwest of Tioga approved by ND PSC
• pipeline bans make gas transport by rail (NGBR) an economic necessity

Operations:

• Rigs back up to 66 in North Dakota

Bakken 2.5:

• Parent-well-uplift; a reader's take on the "halo" effect; Whiting slides; rate of return, infinite;
• Second production jump for a Whiting well

Fracking:

• Whiting's Gen 5

Pipelines:

• MDU/WBI proposed a pipeline to connect Tioga with Northern Border Pipeline
• Bakken natural gas takeaway

Bakken economy

• increasing talk of a petrochemical plant in North Dakota
• Northstar auction; 
• Legacy Fund deposit holds steady

Enerplus "Igneous Rock" Pad

Locator: 10010IGNEOUS. 

Graphic:

The wells (to be completed at a later data):

36073, SI/NC-->A/SI, Enerplus, Scoria 147-93-09C-04H-LL, Moccasin Creek, first production, 5/21; t--; cum 100K 9/21; cum 267K 9/23;

Date	Oil Runs	MCF Sold
9-2021	17803	11074
8-2021	22328	14322
7-2021	25682	17283
6-2021	23373	17596
5-2021	21116	16377

36072, SI/NC-->A/SI, Enerplus, Basalt 147-93-09C-04H-TF, Moccasin Creek, first production, 5/21; t--; cum 140K 9/21; cum 411K 9/23;

Date	Oil Runs	MCF Sold
9-2021	26408	15302
8-2021	23260	11838
7-2021	29849	15686
6-2021	35472	22829
5-2021	29325	20701

36071, SI/NC-->A/SI, Enerplus, Andesite 147-93-09C-04H, Moccasin Creek, first production, 5/21; t--; cum 64K 9/21; cum 159K 9/23;

Date	Oil Runs	MCF Sold
9-2021	11295	6545
8-2021	13876	7061
7-2021	9468	4972
6-2021	7541	4840
5-2021	21424	15123

36070, SI/NC-->A/SI, Enerplus, Granite 147-93-09C-04H, Moccasin Creek, Moccasin Creek, first production, 5/21; t--; cum 90K 9/21; cum 244K 9/23;

Date	Oil Runs	MCF Sold
9-2021	17869	10354
8-2021	18984	9664
7-2021	20278	10659
6-2021	20718	13337
5-2021	13032	9199

36069, SI/NC-->A/SI, Enerplus, Gabbro 147-93-16B-21H, Moccasin Creek, first production, 5/21; t--; cum 140K 9/21; cum 297K 9/23;

Date	Oil Runs	MCF Sold
9-2021	24503	15862
8-2021	31795	21165
7-2021	27800	19030
6-2021	30927	20890
5-2021	28213	12767

36068, SI/NC-->A/SI, Enerplus, Rhyolite 147-93-09C-04H-TF, Moccasin Creek, first production, 5/21; t--; cum 70K 9/21; cum 286K 9/23;

Date	Oil Runs	MCF Sold
9-2021	15927	9229
8-2021	15697	7991
7-2021	14516	7630
6-2021	15168	9764
5-2021	10507	7417

36067, SI/NC--> SI/A, Enerplus, Diorite 147-93-16B-21H-TF, Moccasin Creek, first production, 4/21; t--; cum 24K 9/21; cum 150K 9/23;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	9-2021	29	8457	8435	24200	7386	5460	518
BAKKEN	8-2021	29	7323	7338	28331	6781	4877	727
BAKKEN	7-2021	4	854	873	1932	812	584	95
BAKKEN	6-2021	1	54	54	0	46	36	9
BAKKEN	5-2021	5	6057	6079	16676	4054	2738	0
BAKKEN	4-2021	2	972	773	10030	626	411	0

36066, SI/NC-->A/SI, Enerplus, Pumice 147-93-16B-21H, Moccasin Creek, first production, 4/21; t--; cum 80K 9/21; cum 297K 9/23;

Date	Oil Runs	MCF Sold
9-2021	16901	10941
8-2021	17349	11524
7-2021	18884	12879
6-2021	15655	10574
5-2021	9677	4332
4-2021	2773	1476

36065, SI/NC--> conf (4/29/21)-->A/SI, Enerplus, Obsidian 147-93-16B-21H-TF, Moccasin Creek, first production, 4/21; t--; cum 70K 9/21; cum 184K 9/23;

ate	Oil Runs	MCF Sold
9-2021	15769	10208
8-2021	14305	9498
7-2021	11941	8123
6-2021	11712	7911
5-2021	798	311
4-2021	2948	1569

The pad to the west (left) is the Enerplus "Metamorphic Rock" pad. 

Enerplus "Metamorphic Rock" Pad

Updates

November 20, 2021: production data updated for the pad to the west, the "metamorphic rock" pad.  Note: the NDIC no longer updates their map.

May 11, 2019: updated graphic --

Original Post

Proposed Location For The Enerplus "Metamorphic Rock" Pad:

The "Metamorphic Rock" pad:

• 36225, loc, Hornfels 147-93-08D-05H, Enerplus, Moccasin Creek,
• 36226, loc, Mylonite 147-93-08D-05H-TF, Enerplus, Moccasin Creek,
• 36227, loc, Eclogite 147-93-17A-20H, Enerplus, Moccasin Creek,
• 36228, loc, Phyllite 147-93-17A-20H-TF, Enerplus, Moccasin Creek,
• 36229, loc, Slate 147-93-08D-05H-TF, Enerplus, Moccasin Creek,
• 36230, loc, Quartzite 147-93-17A-20H-TF, Enerplus, Moccasin Creek,
• 36231, loc, Argillite 147-93-08D-05H, Enerplus, Moccasin Creek, 
• 36232, loc, Marble 147-9317A-20H, Enerplus, Moccasin Creek,
• 36233, loc, Gneiss 147-93-17A-20H-TF, Enerplus, Moccasin Creek,

Producing wells of note:

• 18752, 2,194, Enerplus, Henry Bad Gun 17A-20-1H, Moccasin Creek, t7/10; cum 503K 1/20;
• 18790, 1,773, Enerplus, Henry Bad Gun 16B-21-1H, Moccasin Creek, t10/10; cum 482K 1/20;

From a new post:

Amphibolite will be on/near the Enerplus pad with these wells:

• 36225, drl-->loc, Enerplus, Horfels 147-93-08D-05H, Moccasin Creek,
• 36226, drl-->loc, Enerplus, Mylonite 147-93-08D-05H-TF, Moccasin Creek,
• 36229, drl-->loc, Enerplus, Slate 147-93-08D-05H-TF, Moccasin Creek,
• 36231, drl, Enerplus, Argillite 147-93-08D-05H, Moccasin Creek,
• 36228, loc, Enerplus, Phyllite 147-93-17A-20H-TF, Moccasin Creek,
• 36230, loc, Enerplus, Quartzite147-93-17A-20H-TF, Moccasin Creek,
• 36232, loc, Enerplus, Marble 147-93-17A-20H, Moccasin Creek,
• 36233, loc, Enerplus, Gneiss 147-93-17A-20H-TF-LL, Moccasin Creek,

The well holding this lease by production:

• 18752, 2,194, Enerplus, Henry Bad Gun 17A-20-1H, 22 stages; 2.4 million lbs; Moccasin Creek, t7/10; cum 503K 1/20; from the file report:

• 10 miles southeast of Mandaree in Dunn County
• part of Simray's Bakken program within the Williston Basin
• offset wells were essential in curve operations and for landing the well bore within the preferred target interval
• spud March 29, 2010
• vertical hole drilled in 66 hours
• the curve was drilled in 34.5 hours (currently, curves are generally drilled in 12 - 18 hours)
• it appears the lateral was drilled in 133 hours
• the lateral well bore remained in the target zone 90% of the time; and, 100% of its length was drilled within the greater middle Bakken interval
• background gas: 100 - 1,800 units
• gas shows ranged from 500 to 3,500 units before the flow was directed to the gas buster;
• some shows were as high as 6,000 units
• flares: 1-3 feet; increased to 10' as the lateral progressed
• the rig: Precision 512; spud to TD -- 21 days; an incredible job back in 2010

Production steady but non-descript from July, 2010, to December, 2019

Random Update An Enerplus "Heavy Metal" Well -- Nickel, #22968 -- The "Craziness" Of The Bakken - May 11, 209

This is what excites mom-and-pop mineral owners in the Bakken. 

The well:

• 33968, 932, Enerplus, Nickel 147-93-16B-21H-TF, Moccasin Creek, 33 stages; 5.9 million lbs, t8/18; cum 110K 3/19;

Enerplus "Heavy Metal" pad is followed here.

Production:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	3-2019	30	27706	27174	19140	24936	10862	11305
BAKKEN	2-2019	3	519	624	1315	468	259	180
BAKKEN	1-2019	24	6385	6365	7619	5747	3804	1150
BAKKEN	12-2018	31	8951	9026	10993	8120	7043	0
BAKKEN	11-2018	29	14053	14155	12166	14820	13482	0
BAKKEN	10-2018	23	16854	17276	16529	21910	13032	8078
BAKKEN	9-2018	26	26747	26442	24455	34772	4535	29225
BAKKEN	8-2018	31	36083	35723	33425	46908	198	46018
BAKKEN	7-2018	2	985	923	4284	1281	108	1168