Monday, June 3, 2019

Clarification Regarding Earlier Note: ND Board Of Trust Lands -- June 2, 2019

[Hopefully I got this all correct, and hopefully it makes sense. I'm simply correcting my error when I wrongly suggested the ND Board of Trust Lands was part of the "oil and gas division" of the NDIC . It is not. Two separate entities.]

Previously posted:
MRO denied: link here. See this post for background and graphics
North Dakota's Board of University and School Lands has denied a leasing extension to an oil company that has sought to develop several Badlands mineral tracts since 2013.
The panel of five state elected officials chaired by Gov. Doug Burgum voted unanimously at its meeting Thursday morning to deny Marathon Oil's request for another 360-day leasing extension. The company has faced rough terrain, mixed landownership and protected species requirements in siting a drill pad.
After posting this note confusing the NDIC with the ND Board of Trust Lands I received a nice note and clarification from a reader:
It is a pre-full cup of coffee this morning, but as to your post this morning with its reference to decisions by the NDIC---there needs to be a clarification between the Land Board and the NDIC Oil and Gas Division.  The Marathon decision was by the ND Board of Trust Lands.  This Board among other duties manages the state-owned minerals [as well as surface ownership and other responsibilities]. 
Below is the link that takes one to minerals management by the Board.
https://www.land.nd.gov/mineral-auctions
This is a separate entity from the Oil and Gas Division of the Industrial Commission.
This was a nice note to have received. I missed the note when it was originally sent to me and that is the reason for the delay in posting.

I was confused exactly "who was what" and this is a big help.

Big "thank you" to the reader.

I had suggested that it was the NDIC that made the ruling; I was wrong -- as the reader notes. Two different entities involved.

Enbridge Line 3: Dead -- June 3, 2019

This is not an unimportant pipeline.

But it is what it is: another "blow" for Canada.

From oilprice:
Enbridge’s Line 3 pipeline replacement project ran into another unsurprising roadblock on Monday after a Minnesota State Court of Appeals ruled that its environmental assessment just wasn’t good enough. The ruling is a reversal of Minnesota Public Utilities Commission’s decision that approved the environmental impact statement for the pipeline replacement.

The project plans to replace Enbridge’s existing 282 miles of 34-inch pipeline with 337 miles of 36-inch pipe. The appellate court found today that the Commission erred when it approved the plan, and found that Enbridge’s environmental impact statement lacked in specificity, specifically where it deals with oil spills in relation to Lake Superior.

The new Line 3 would have the capacity to move 370,000 barrels of oil per day, alleviating the takeaway capacity constraints that Canada is facing. Line 3 is one of two pipeline projects in the works that are—in their unfinished state—keeping Canada’s oil industry from reaching its potential.
At least Enbridge knows what it needs to do: improve its emergency response to any oil spills "in relation" to Lake Superior.

One would think if the emergency response plan is lacking for a new pipeline, the same response plan is inadequate for an aging pipeline. Perhaps the state needs to shut down Line 3 altogether. 

Short term great news for Enbridge investors. No money being spent on an expensive replacement project.

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.

Enbridge pipelines are tracked here.

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Operator

Operator, Jim Croce

CLR Announces The Initiation Of A Quarterly Dividend -- June 3, 2019

Updates

June 4, 2019: add Shell to the list. Yesterday, it was CLR; today it is Shell announcing huge shareholder return.

Original Post 

Previously posted:
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.

For an alternative view:
  • US shale boom about to go bust: Nick Cunningham
  • US shale: not a revolution, but a retirement party: Art Berman
Today, we have this story from the same group of folks: why oil stock dividends are soaring this year. The headline seems to be a bit of hyperbole based on the story itself. If examples of any of these "soaring dividends" were given, I missed them. Data points:
  • some independent US drillers are starting to increase dividends this year
  • some of these dividends had been slashed/frozen as a result of the price slump in 2015 and 2016 (the Saudi Surge or "Saudi's trillion-dollar mistake")
  • however, publicly-traded US shale companies still underperforming the market in general
  • have amassed large amounts of debt
  • having trouble raising capital through banks
"Last year, equity and bond issues by US drillers slumped to $22 billion -- the lowest level since 207, according to an analyst at The WSJ."

One, of course, could argue that the US drillers did not need to raise as much capital as in 2015 and 2016.

Just saying.
And then this story this morning: on a "per-bbl basis, E&D costs came down in 2018."

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CLR

From a company press release:
Continental Resources, Inc. today announced that its Board of Directors approved the initiation of a quarterly dividend of $0.05 per share ( $0.20 per share annualized) on the Company's common stock and an initial $1 billion share-repurchase program. Continental maintains its 2019 guidance as announced on February 13, 2019 , reaffirming the Company's commitment to its corporate objectives and a strong alignment with shareholders.
One wonders to what extent the Trump corporate tax cut made this possible?

Eight New Permits; WTI Continues ToTrade Down -- June 3, 2019

WTI: down 1.23%; down 66 cents; trading under $53. 

Active rigs:

$52.846/3/201906/03/201806/03/201706/03/201606/03/2015
Active Rigs6460512581

Eight new permits:
  • Operators: XTO, Zavanna
  • Field: Capa (Williams), Stony Creek (Williams)
  • Comments:
    • Zavanna has permits for a 3-well Blue Heeler pad in section 20-155-100, Stony Creek oil field 
      • there is currently one permit in that drilling unit
        • 21227, 909, Zavanna, Leopard 20-17 1H, Stony Creek, t7/12; cum 333K 4/19; steady Eddy; nothing remarkable except a nice 30-day IP back in 8/12 of 21,291 bbls
    • XTO has permits for a 5-well Marilyn pad in section 23-155-95, Capa oil field
      • there are currently two long laterals in that 1280-acre drilling unit:
        • 20109, 756, XTO, Marilyn 21X-23, Capa, t10/11; cum 210K 4/19; steady Eddy, nothing remarkable; completion data not at NDIC file report; FracFocus: 2.748 million gallons of water (a very small frack); 89.1% water;
        • 17813, 448, XTO, Tubie 21X-23, Capa, t4/09; cum 95K 4/19; 
Six permits renewed:
  • CLR: two Berlain permits in McKenzie County; two Olympia permits and two Charleston permits, all in Williams County
Four producing wells (DUCs) reported as completed:
  • 34923, n/d, CLR, Collison 12-23H1, Avoca, t--; cum --; all neighboring wells still off line;
  • 35053, n/d, CLR, Collison 13-23HSL, Avoca, t--; cum --; all neighboring wells still off line;
  • 35165, 932, Kraken, Sutton 3-10 5TFH, Oliver, t--; cum --; all neighboring wells still off line;
  • 35167, 1,169, Kraken, Sutton 4-9 1TFH, Oliver, t--; cum --; all neighboring wells still off line;
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The Blue Heeler -- An Australian Cattle Dog

Link here.


MacOS Catalina -- June 3, 2019

Keynote here.

MacOS Catalina. Not even mentioned by pundits before it was announced.
With over five years having passed since the trademarks were applied for, many have now been abandoned, either at some point during the review process or through failure to provide proof of commercial use following approval. In fact, of the original 19 names that were included in the trademark applications, all but four of them have been either used by Apple or abandoned, with the remaining live applications being Mammoth, Monterey, Rincon, and Skyline.

Perhaps the most interesting one is Mammoth, which is likely related to Mammoth Lakes and Mammoth Mountain, a popular area for skiing and hiking in the Sierra Nevada mountains.
iTunes change.
  • Apple Music.
  • Apple Podcasts.
  • Apple TV.
Sidecar: iPad can now be used as a second display for your Mac.

Find My: can locate Apple devices off-line. This is really, really clever how they did this. Absolutely amazing.Will not affect battery life, or privacy.

Activation lock:

App store:

All new platforms available today as "beta."

All software will be available to users in the fall, 2019.

The conference will go on for a full week for developers.

In Other Words, Gasoline Should Remain Quite Inexpensive This Summer -- June 3, 2019

Updates

June 4, 2019: see first comment -- EIA: the "914s"; the monthlies; the most accurate production data - US Field Production of Crude Oil.

Original Post 

For background, see this post.

From twitter today:



Which reminds me, the doofus:


Pipeline Problems In New York -- June 3, 2019

Previously posted and being followed: NY denies pipeline permit for Long Island -- see this post for background.

Now another New York state pipeline could be in jeopardy: the E37:
National Grid's so-called E37 project is a 7-mile expansion of its "Albany Loop" that brings natural gas around the Capital Region (Albany, NY).
The $70 million project would connect National Grid's system in Bethlehem to its Troy Gate Station on Bloomingrove Drive in North Greenbush with a pipeline extension that would be built under the Hudson River.
The comment period was extended from April 24, 2019, to May 24, 2019.

The next milestone: The PSC will hold what's known as a procedural conference on June 6 that will set the schedule for a future vote by the commissioners, which is months away.

The "NYC pipeline" that was denied -- was denied a water permit allowing the pipeline to go under the Hudson River. Likewise, the E37 also goes under the Hudson River.

As for me, I'm thrilled to have completed two books on the revolutionary war this past month. I specifically chose books on General George Washington's campaign in New England to get a better understanding of the waterways in that area. Now, when "they" talk about the Hudson River, NYC, and Albany, as well as the Delaware River, Trenton, and Princeton, I have a much, much better feel for that area.

Same with Long Island, Long Island Sound, Staten Island, Kill van Krill, Arthur Kill, Hell Gate, The Narrows, and the upper and lower bays, and even Sandy Hook.

The two books:
  • Valiant Ambition: George Washington, Benedict Arnold, and the Fate of the American Revolution, Nathaniel Philbrick, c. 2016
  • Washington Crossing, David Hackett Fischer, c. 2004.
 Philbrick's 2016 book also led me to his 2018 book:
  • In The Hurricane's Eye: The Genius of George Washington and the Victory at Yorktown, Nathaniel Philbrick, c. 2018. 
By the way, on a completely different note, and I might come back to this later, a lot of "quantum theory" history was made in New York. From the top of my head, as they say:
  • the Manhattan Project, of course
  • Cornell University, Ithaca, NY: Hans Berthe (perhaps one of the important physicists at Los Alamos; Robert Oppenheimer
  • [Cornell University is also known for its ornithology lab and studies.]
  • Long Island conferences 
If I didn't have driving responsibilities for the granddaughters, I think I would love to take a cross-country trip up to Ithaca, NY.

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A Note for the Granddaughters

The two older granddaughters are in Rome, Italy, for a few days before they fly to Athens, Greece. They and their father will then rent a sail boat and sail among the Greek islands for ten days. Their father is the skipper, and the oldest granddaughter, Arianna, will be the first mate. Olivia will round out the three-person crew. Both Arianna and Olivia have taken sailing lessons and, I believe, have received sailing certificates at some level.

Here they are, flying to Rome:



California Wind Energy: All Talk -- June 3, 2019

Updates

Later, 8:56 p.m. CT: with regard to data below, a reader writes, citing a WUWT post, back in June, 2014:
Texas: almost 10 percent of installed wind capacity can be included as dispatchable, what they refer to as ELCC, effective load-carrying capability.
This (8.7 percent) is presently at 920 MW out of an installed base of 12,000 MW wind energy.
Note: comparable posting for the German grid concluded that Germany now (2018) having sufficient wind capacity to supply all their needed power under optimum conditions that the "substitution factor" for additional wind was 5% (the amount of conventional base load that could be retired. That is, 1000 MW of further wind addition enables shutting down 50 MW of conventional power).
This is the kind of "stuff" that:
  • the German government and the state of Texas do not tell their ratepayers; and, 
  • even if they did, the average ratepayer would not understand
The US federal government has stricter regulation on the transparency of calories in all food sold at supermarkets or in restaurants. Utilities and renewable energy companies are getting "away with murder." 

Original Post 

EIA link here, 2017 data. From twitter today:


Or as President Bush II used to say, "all hat, no cattle."

In land area, isn't California like the third biggest state and as far as wind goes, I think it has some of the best wind in the country, and yet California trails Oklahoma, Iowa and Kansas. At 486 "units," CA, KS, and IA combined produce less wind energy than Texas.

Largest Private Real-Estate Transaction Ever -- Warehouse Network -- June 3, 2019

This tells me all I need to know about the future of:
  • e-commerce
  • Amazon
  • Target
  • Wal-Mart
  • USPS
  • UPS
  • FedEx
From The Wall Street Journal:


Data points:
  • buyer: Blackstone Group
  • seller: Singapore-based GLP
  • deal: $18.7 billion --let's just call it $20 billion
  • deal: 180-million-square-foot portfolio
  • record: largest private real-estate transaction ever
  • impact: a big bet on the continued explosion of e-commerce
  • outbid: Prologis, Inc was outbid
  • price per square foot of warehouse? $103/square foot -- amazing -- that's just about what one would expect -- $100/square foot
An average Walmart store is 100,000 square feet.

180 million square feet / 100,000 square feet = 1,800 Walmart stores (average size).  Walmart operated about 4,800 stores in the US in 2019. Another source suggested Walmart operated close to 6,400 stores around the world.

Cheniere To Add 6th Train At Sabine Pass -- June 3, 2019

The list: the list of potential US LNG export facilities is here. Note: at the original list only five trains were projected by the end of 3Q19.

Cheniere makes positive FID on 6th LNG train at Sabine Pass in Louisiana. Link at Platts. Data points:
  • will also secure a gas supply deal with Apache
  • Cheniere is the biggest LNG exporter in the US
  • this FID was widely expected after the company's deal with Malaysia's Petronas in December, 2018, to support the production unit
  • an offtake agreement with commodity trader Vitol will also support Train 6
  • much more at the link
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US LNG Export

From twitter today:

Finally, Some Good News For Williams County Schools -- June 3, 2019; Meanwhile, On ESPN Tonight -- Women's Championship Softball

Williams county, city get lion's share of energy impact grants from the state -- The Williston Herald

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The Sports Page

Some of the best sports all weekend. I was able to catch the Women's College World Series in between:
  • the PGA: we heard how Arnold Palmer really feels about Tiger Woods, unfiltered; Woods had an incredible front nine on the fourth day
  • the NASCAR race: good but not great
  • Indy racing: caught very little of the race
  • MLB: Red Sox at Yankees (amazed how empty the stands were)
  • Stanley Cup Hockey: missed the games
  • NBA Championships: missed the game last night; series evened at 1:1
From the NCAA:
The 2019 Women’s College World Series began on Thursday, May 30 and will continue through June 4/5. It will be played in Oklahoma City for the 23rd consecutive season and 29th time in the past 30 years. The USA Softball Hall of Fame Stadium-OGE Energy Field will play host.
UCLA and Oklahoma will play for the national title in a best-of-three championship series from June 3-4/5.
Championship Finals (Best-of-3)
  • Game 1: UCLA vs. Oklahoma | 7:30 p.m. on Monday, June 3 | ESPN 
  • Game 2: UCLA vs. Oklahoma | 8:30 p.m. on Tuesday, June 4 | ESPN 
  • Game 3: UCLA vs. Oklahoma | 8:30 p.m. on Wednesday, June 5 | ESPN
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Ten Pretty Women -- Take This Waltz

Take This Waltz, Leonard Cohen

The Bakken Goes Boom -- A Look Back -- 2016, 2018

These should download as PDFs on your desktop. 

Link here to Jackson, 2018.

Link here to Conway, 2016.

Well, Lookee Here -- Seems To Be Counter To Everything We've Been Hearing Elsewhere; Costs Came Down On A Per Bbl Basis -- June 3, 2019

Rigzone is reporting that "E&P costs hit 10-year low in 2018." Data points:
source: EIA
  • based on analysis of 116 E&P companies' annual reports
  • the companies added a net 10.3 billion boe to their proved reserves during 2018
  • total E&D costs: a nine percent (9%) vs 2017 when calculated as dollars per BOE of proved reserves added
  • actual costs actually increased
  • costs provide an idea of the expenditures needed to add one barrel of proved reserves
  • the 2018 E&D costs incurred at $15.20 per additional boe of proved reserves was the lowest it’s been since 2009
Note: it would be interesting to see the break-out of conventional costs vs non-conventional oil E&D costs. 

The Rixie Wells

The wells:

Running from the north to the south:
  • 23054, 786, Kraken, Rixey 2-28H, Lone Tree Lake, t9/12; cum 229K 4/19; off line as of 4/19;
  • 23055, 781, Kraken, Rixey 3-28H, Lone Tree Lake, t9/12; cum 150K 4/19; off line as of 4/19;
  • 21641, 682, Kraken, Rixey 1-28H, Lone Tree Lake, t3/12; cum 233K 4/19; off line as of 4/19;
Running north from the south:
  • 35792, 738, Kraken, Rixey 33-28 4TFH, Lone Tree Lake, t6/19; cum 10K 6/19 -- after 20 days;
  • 35795, 1,104, Kraken, Rixey 33-28 7H, Lone Tree Lake, t6/19; cum 11K 6/19 -- after 12 days;
  • 35796, 700, Kraken, Rixey 33-28 8TFH, Lone Tree Lake, t6/19; cum 9K after 12 days;

Five Wells Coming Off The Confidential List Today -- June 3, 2019

Global oil shortage: real or fake news? From Bloomberg. A nice update.  

Peak oil? Hardly. From twitter today --

Voyager open season extended, link here:
Magellan Midstream Partners, L.P. and Navigator Energy Services reported Friday that they have extended the open season for their proposed Voyager Pipeline System, which would ship crude oil from Cushing, OK, and Midland, TX, to Houston.
.... a 20-inch-diameter pipelines from MMP’s Cushing and Midland terminals to its terminal in Frost, Texas, and constructing a 24-inch-diameter pipeline from Frost to MMP’s terminal in East Houston.
From East Houston, multiple crude oil grades – sourced from Bakken, Rockies, Mid-Continent and Permian producers ...

At Cushing, Voyager would receive shipments from MMP’s Saddlehorn and Navigator’s Glass Mountain pipelines.
In the Permian, the Voyager project might entail repurposing existing MMP pipeline and rights-of-way and/or building new pipeline. The most recent open season document states the Voyager system would likely carry up to six light crude and condensate grades.

Friday’s announcement marks the third open season extension for the proposal; should be operational in early 2021.  
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Back to the Bakken

Wells coming off the confidential list today, over the weekend -- Monday, June 3, 2019: 5 for the month; 194 for the quarter;
Sunday, June 2, 2019: 4 for the month; 193 for the quarter;
  • 35377, SI/NC, Newfield, Skipjack 149-98-11-2-5H, Pembroke, no production data,
Saturday, June 1, 2019: 3 for the month; 192 for the quarter;
  • 35737, SI/NC, Newfield, Skipack 149-98-11-2-11H, Pembroke, no production data,
  • 35476, SI/NC, Hess, SC-JCB-LE-154-98-1721H-2, Truax, no production data,
  • 35241, SI/NC, WPX, Badlands 4-33-28HA, Heart Buttex, no production data,
Active rigs:
$54.436/3/201906/03/201806/03/201706/03/201606/03/2015
Active Rigs6460512581

RBN Energy: Oryx Midstream's Permian crude gathering and regional transport system.
By their very nature, crude oil gathering systems in the Permian are works in progress. They often start out small, serving only a few wells owned by a single producer — or maybe two or three. Over time, the systems typically branch out to serve more producers and more wells, and they add capacity as drilling activity picks up.
Sometimes, they evolve into much larger systems with multiple gathering hubs and regional transport pipelines that shuttle large volumes of gathered crude long distances to big marketing hubs like Crane, TX, and Midland, where the oil can flow into any number of takeaway pipelines to Cushing or the Gulf Coast. Today, we continue our series on Permian crude gathering systems with a look at Oryx Midstream’s 860-mile gathering and regional transport network in the super-hot Delaware Basin.
The focus of today’s blog is the Oryx Trans-Permian (OTP) gathering and regional transport system, which has been developed from scratch by Oryx Midstream Services over the past five years. In April 2014, Oryx Midstream received an initial commitment of $300 million from Quantum Energy Partners, Post Oak Energy Capital, Wells Fargo Energy Capital, Oryx management and other private investors to pursue midstream opportunities in the Permian, with an initial focus on the needs of three producers in the northern Delaware Basin.
Since then, the system — still centered in the Delaware — has grown by leaps and bounds, to the point that Oryx Midstream is now the largest privately held crude midstream operator in the entire Permian. In April 2019, funds managed by Stonepeak Infrastructure Partners reached an agreement to acquire Oryx for $3.6 billion in cash — as good an indicator as any that the Oryx folks have built out an important and valuable system.
In this series, we’ve discussed a broad range of Permian gathering systems: new and not-so-new, small and expansive, and in the Midland Basin and in the Delaware, to include:
  • the recently announced Beta Crude Connector, a 100-mile-plus, 150-Mb/d gathering system that a joint venture of Concho Resources and Frontier Energy Services is developing in the Midland to serve Concho and other producers
  • another Midland-area system: Reliance Gathering’s 185-Mb/d pipeline network, which was originally developed to serve the affiliated producer Reliance Energy, but which has since undergone a number of expansions to serve other producers too
  • San Mateo Midstream’s crude gathering systems in the Delaware Basin — one in Eddy County, NM, and the other in Loving County, TX — and its plans for two new systems on the New Mexico side of the state line
  • Medallion Midstream’s fast-growing, 1,000-mile crude oil gathering/header system in the Midland (which provides access to firm shippers serving 20 producers) and its 116-mile Delaware Express gathering/shuttle system in the southern Delaware
  • the 200-mile gathering system that refiner Delek US has been developing — also in the Midland — to deliver locally produced crude to Delek’s Big Spring, TX, refinery and others
  • the crude gathering system that a joint venture of WPX Energy and Howard Energy Partners (HEP) has been developing in the Delaware Basin’s Stateline area; that system currently includes more than 50 miles of pipe, with another 20-plus miles under construction