Rambling On A Friday Night -- Anything To Get My Mind Of Current Events -- March 13, 2020

Mentally worn out: I'm not going to do much with my e-mail tonight. I'll get to it over the weekend.  A reader in the oil business told me today he met with an old, seasoned oilman this past week. The reader said that folks in the oil business s have been through more in the past thirteen years than he had seen in the past forty years. Hope that makes sense. The reader said it better, but you get the point. I think I've seen more in the past two weeks than I've seen in the past twenty years when it comes to investing, and especially energy.

Goldman Sachs: a reader sent me a Rolling Stone article written back in 2009 about GS. I posted the link the other day. The reader has had a 30-year career in the financial sector and says the article is right on target. The writer, Matt Taibbi, is writing in response to the 2008 - 2009 financial crisis.

If you want to understand how we got into this financial crisis [2008 - 2009], you have to first understand where all the money went — and in order to understand that, you need to understand what Goldman has already gotten away with. It is a history exactly five bubbles long — including last year’s strange and seemingly inexplicable spike in the price of oil. There were a lot of losers in each of those bubbles, and in the bailout that followed. But Goldman wasn’t one of them.

The five bubbles:

• the Great Depression, the Great Crash, 1929
• the dot-com/tech bubble, 2000
• the housing craze/bubble, 2008
• the oil crash/bubble, 2008
• the bailout, 2008

It was a difficult article for me. Probably too much "inside-information" for an outsider like me.

I need to read it a couple of more times,

I did read the section on the oil crash twice; it might have some relevancy to the current situation. Might.

Anyway, I know folks have strong opinions on Goldman Sachs; I'm not going to get into that. I will be very "tough" moderating comments. I'm just reminding folks of the article. It might be a good starting point for further reading.

The Ephrussi Family. From wiki:

The Ephrussi family is a Russian Jewish banking and oil dynasty. The family's bank and properties were seized by the Nazi authorities after the 1938 "Anschluss", the annexation of Austria by Nazi Germany.

The progenitor, Charles Joachim Ephrussi (1792–1864), from Berdichev [northern Ukraine], made a fortune controlling grain distribution beginning in the free port of Odessa (then Russian Empire, now Ukraine) and later controlled large-scale oil resources across Crimea and the Caucasus. By 1860, the family was the world’s largest exporter of wheat.

I'm currently enjoying, for the second time, The Hare With Amber Eyes, Edmund de Waal, c. 2010. The author is the great-great-great-grandson of the patriarch, Charles Joachim Ephrussi, b. 1793. The author's grandmother, an Ephrussi, married A Hendrik de Waal, and that's how the author's name came to be other than Ephrussi.

The author spends just a little bit of time, a very little bit of time, touching upon the history of the Ephrussi family. It's amazing how a really good writer can paint a five-generation picture that captures all that needs to be known in less than a page. Edmund de Waal does this.

It's hard not to think about Goldman Sachs when reading about the Ephrussi family.

On page 29:

Odessa was a city within the Pale of Settlement, the area on the western borders of Imperial Russia in which Jews were allowed to live. It was famous for its rabbinical schools and synagogues, rich in literature and music, a magnet for the impoverished Jewish shtetls of Galicia.

Wow, so much packed in that one sentence.

Shtetl: pronunciation.

".. within the Pale of Settlement." "Beyond the pale" as a phrase always fascinated me. I overused that phrase in the blog during the early days of the Trump administration. I thought I may have explained the etymology of that phrase. If I did, I was unable to find the post. However, in the process of searching I ran across my notes on A Journal of the Plague Year, by Daniel Defoe, published in 1722; the plague year was 1666. How coincidental. It was eye-opening to read Daniel Defoe's account of the plague year:

The notes at the end of the book are superb. Rats are mentioned only once. -- p. 116

The quarantine actually worked -- p. 37 -- had it really been enforced -- could more lives have been saved?

Why did plague end so abruptly? Plague reached its peak in September; great statistical analysis, p. 213

Not only were active cases decreasing but more people were surviving -- initially death -- 4/5; now it was 3/5 surviving. [4/5 die; now 2/5 die] Other cities after London: Norwich, Peterborough, etc.

Back to the Pale of Settlement: from Defoe's journal: gardens, walls, pales (beyond the Pale) (pales - think “picket fence” -- what is the word for the pointed logs used in American forts? that’s what I envision “pales” are” ) [pales to poles? -- yes! from a website: Middle English, from Old English pal, from Latin plus, stake; see pag- in Indo-European roots. “beyond the pale” --- “off the reservation.”

Alexa: Rosanne Cash. I can't say it enough. Amazon/Echo/Alexa is priceless. I'm sure there are other options out there, but I am blown away by Alexa. I've been listening to Roseanne Cash now for an hour, and nothing has been repeated, and hearing songs I've never heard by her. It's like a stack of LPs. The only thing I miss are the album covers and the liner notes. LOL.

That's it. I'm signing off. Have to be up at 6:00 a.m. to take the oldest granddaughter to SAT testing tomorrow morning.

The Seven-Year Ache, Rosanne Cash

KODA Resources With Two New Permits -- March 13, 2020

I haven't watched any of the news in the past 24 hours but a reader says "Trump hit a home run today." The reader mentioned two things. I'm sure I'm taking this out of context and the devil will be in the details but if this is accurate and this is how President Trump is thinking, wow, again, from the perspective of a businessman and not a politician. With regard to Saudi flooding the market with oil for $25 - $35/bbl, President Trump says the US will buy up all that it has room for (think, SPR -- strategic petroleum reserve). Wiki says capacity of the US SPR is 727 million bbls; currently about 635 million bbls.

SPR: At an extra two million bbls/day from Saudi Arabia, let's see -- (727 - 635)/2 = 46 days. Fairly biblical. Forty days and forty nights. Unloading Saudi Arabia oil for $25/bbl into our US SPR. Gotta love it.

Cushing: 85 million bbls capacity.

Corpus Christi / Gulf of Mexico: has been adding a lot of storage for quite some time.

It looks like if given the go-ahead, the US public and private entities could soak up a lot of $35-Saudi oil. Sure, eventually it comes to an end, but that's not how traders and businesswomen think. Gotta love it. Even if it doesn't do much for the price of oil, we can let the Saudis know we love the price at which they are willing to give their lifeblood away.

Oh, that's right. That reader, or another reader, also said the market had a good day. I don't know; I wasn't watching, although, at the market opening, I did buy some more shares in the non-energy position that I'm accumulating.

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

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

Back to the Bakken

Active rigs:

$31.73	3/13/2020	03/13/2019	03/13/2018	03/13/2017	03/13/2016
Active Rigs	55	65	58	46	32

Two new permits, #37447 - #37448, inclusive --

• Operator: KODA Resources Operating, LLC
• Field: Bar Butte (Williams County)
• Comments: 
• KODA Resources has permits for a two-well Porter pad in NENE 26-159-102, Bar Butte oil field;

No oil and gas permits renewed or canceled; and, no producing wells (DUCs) reported as completed.

Another twelve wells with a change of operator, from BTA Oil Producers to Scout Energy:

• oldest file number: 06859
• most recent file number: 21614, most were much older
• all in Billings County except for one Stark County well
• common well names: JV-P Snow; JV-P Barlow; JV-P Prashko; JV-P Knudtson

I Thought I Had A Read That The California Drought Was Back -- March 13, 2020

I thought I read sometime in the past week or so that the California drought was back. Whatever.

Link here for the Lake Mead map.

California forecast.

Is This A First In The Nation? -- March 13, 2020

The city of San Antonio, TX, will have a drive-through testing station -- I didn't catch the date it will be up and running but I got the impression it's imminent. [Later: see comments: Denver had a drive-through testing station up and running a week ago.]

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

The Apple Page

Link here.

This is really pretty amazing. I've been having a lot of fun using the Apple Pencil with the iPad. I got the iPad and the pencil for Sophia and she figured it out pretty quickly.

Playing around with the pencil, I noted (no pun intended) that one could "write" on the Apple Notes application. When I saw that, I said to myself I wish one could write on other Apple apps with text input using the Apple Pencil.

And there it is, from the link above:

iOS 14 may include a new PencilKit feature that will allow you to handwrite text in any text input field using Apple Pencil, with the handwritten content then converted into standard text before it's sent. So, for example, you might be able to tap into a Messages text field with the ‌Apple Pencil‌, hand write a message to someone, have it automatically converted to a more easily readable typewritten text, and then send it.

According to information obtained by MacRumors, the PencilKit feature appears to work with any text input field available in iOS, making it compatible with Messages, Notes, Reminders, Calendar, Mail, and more. A floating interface will pop up whenever a text field is tapped with the pencil, allowing for the written input. [A floating interface now allows one to use the Apple Pencil to write in Notes.]

Apple does not have a feature at this time that converts handwritten content into typed content, but the Notes app does have functionality that recognizes handwritten words and allows them to be searched.

It looks like third-party apps will also be able to access a PencilKit tool that will support some kind of new handwriting functionality, but the extent of it is unclear.

School Closure -- Texas -- March 13, 2020

Schools in Grapevine, TX, north Texas, DFW, will close for two weeks, beginning immediately.

The tea leaves suggest the governor will follow the rest of the nation and direct all Texas public schools to close immediately.

My hunch is that not a whole lot will have changed two weeks from now, except perhaps higher numbers, necessitating prolonging the closure.

I think there's a very, very good chance that we've seen the end of the school year for this year. As it is, by the time the students get back to school, it will be nearly April and school adjourns for the year in late May. [See my reply to a reader's comment in the comment section below.]

So, we'll see.

Closer Look At An Enerplus Turtle Well -- The Map Well -- March 13, 2020

The well:

• 35065, 520, was SI/NC-->conf, Enerplus Map 152-94-33D-28H-TF1, Antelope, t9/19; cum 141K 1/20; F; 43 stages; 15.6 million lbs; (there is a common map turtle),

Production:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
SANISH	1-2020	30	38138	38106	16036	60907	51167	9629
SANISH	12-2019	31	42033	41969	23828	67126	39114	27916
SANISH	11-2019	27	32033	31772	19060	51157	38171	12618
SANISH	10-2019	16	14284	14391	21489	22813	10691	12086
SANISH	9-2019	13	14606	14409	28127	29212	5109	24077

From the file report:

• spud: January 12, 2019
• TD: May 10, 2019;
• total days: 18
• total drilling days: 178.2
• True Rig 40
• vertical section: 9,833.9 at TD;
• KOP: 10,173' TVD;
• lateral footage: 10,096';
• it looks like it took about 1.5 days to drill the curve; it took two extra trips during the curve due to lack of build rates;
• slightly less than full four days to drill the lateral; no trips occurred in the lateral portion;
• background gas ranged from 500 - 1600 units; connection gases ranged from 800 - 2400 units;

Separation Factor Plot (two screenshots to get this big enough to be seen):

The Great Toilet Paper Pandemic -- Powerline -- March 13, 2020

Link here.

These are all excellent. This one may be one of the better ones but it was really, really hard to decide which one to post. I think this one stood out because of the great pun. And really how it is so clever on so many levels. Yes, once Arnie runs out of these twenty-four rolls, he will be back. LOL.

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

On A Completely Different Note

No one is asking the obvious question.

In addition to the drugs, why else were three men sharing a hotel room together?

Random Update: Notes On The Enerplus Tortoise/Turtle Pad In Antelope-Sanish -- March 13, 2020

Both Enerplus wells that came off the confidential list today were initially placed on the SI/NC list -- that is, they were DUCs. Then they were taken off the SI/NC list and put on the confidential list. Today, as noted, they were released from the confidential list.

I note this only because this makes it increasingly difficult to sort out which wells have been designated DUCs in the past. I will miss many of them I suppose. At the end of the day, it does not matter, but whether a well goes on the SI/NC (DUC) list helps me follow the activity in the Bakken.

It has always been a problem, but it will only get worse. 

The vast majority of Bakken wells, if not all Bakken wells, are on the confidential list at one time or another. We've talked about this before. The only wells that I report on a daily basis come of the confidential list. At the end of the day my database almost exactly matches the number of wells that the NDIC reported for that year.

Be that as it may, the two Enerplus wells that came off the confidential list today are tracked here.

These wells are in the Antelope-Sanish. There are many, many incredibly good oil fields in the North Dakota Bakken, but it was interesting that a spokesman/Bakken analyst suggested in an article in The Williston Herald earlier this week that the Antelope-Sanish oil field was the premier field in the North Dakota Bakken.

Although it's impossible for me to keep all these fields up-to-date, this is where the Antelope-Sanish is tracked. 

These are the two Enerplus "turtle" wells that came off the confidential list today:

• 35062, 1,018, , was SI/NC-->conf, Enerplus, Leatherback 152-94-33C-28H, Antelope, t9/19; cum 116K 1/20; F; 42 stages; 10 million lbs;
• 35065, 520, was SI/NC-->conf, Enerplus Map 152-94-33D-28H-TF1, Antelope, t9/19; cum 141K 1/20; F; 43 stages; 15.6 million lbs; (there is a common map turtle),

To see just how incredible this field is look at this well, tracked here:

• 27587, 2,188, Enerplus, Softshell 152-94-33C-28H TF, Antelope, Sanish, t11/14; cum 786K 1/20; incredibly good well with multiple bumps in production; off line 6/19; remains off line 8/19; back on line 7/19; 

Completion strategies since 2018 are tracked here. 

Enerplus Reports Two Huge Wells; CLR Reports A Nice Well -- March 13, 2020

Gas Buddy, Oklahoma City:

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

Back to the Bakken

Active rigs:

$32.98	3/13/2020	03/13/2019	03/13/2018	03/13/2017	03/13/2016
Active Rigs	55	65	58	46	32

Three wells coming off the confidential list today -- Friday, March 13, 2020: 22 for the month; 193 for the quarter, 193 for the year:

• 35828, 448, CLR, Imsland 6-31H, Hamlet, t9/19; cum 56K 1/20; 33 stages; 5.9 million lbs;
• 35065, 520, Enerplus Map 152-94-33D-28H-TF1, Antelope, t9/19; cum 141K 1/20; F; 43 stages; 15.6 million lbs;
• 35062, 1,018, Enerplus, Leatherback 152-94-33C-28H, Antelope, t9/19; cum 116K 1/20; F; 42 stages; 10 million lbs;

RBN Energy: Oasis Midstream Partners' Bakken crude oil gathering systems.

The crude-oil price crash of the past couple of weeks is forcing producers in every U.S. shale play to reassess their drilling-and-completion plans for the balance of 2020. Still, while the pace of activity in the Permian, the Bakken and other major plays may slow somewhat in the coming months if crude prices stay low, the vast majority of the new wells that are drilled will need to be connected to crude gathering systems — ideally ones that offer producers and shippers a high degree of destination optionality. Today, we continue our series on crude-related assets in western North Dakota with a look at another leading midstreamer’s gathering system, and its link to the Dakota Access Pipeline and a nearby refinery.

It will probably be a while before all of us have a better sense of the range in which crude oil prices will settle. What we already know — and have known for some time now — is that the four North Dakota counties (McKenzie, Dunn, Mountrail and Williams) that account for nearly 90% of Bakken production offer producers some of the best, most productive rock in the U.S. We also know that there is a relatively strong relationship between crude oil prices and Bakken production. As we said in Part 1 of this blog series, the shale play’s output peaked at ~1.26 MMb/d  in December 2014, a few months after crude prices started tumbling, then bottomed out at ~960 Mb/d in December 2016, a few months after prices cratered. Since then, it’s been mostly up, up and up. By July 2018, Bakken production topped its December 2014 peak of ~1.26 MMb/d, then sped past 1.4 MMb/d in October 2018 and 1.5 MMb/d in October 2019. We mentioned in the same blog that there have been challenges to the Bakken rebound, including a shortfall in crude oil pipeline capacity out of the play — which was largely solved by the June 2017 startup of the Dakota Access Pipeline (DAPL) — and, more recently, the need for more gas processing capacity to handle the large volumes of associated gas emerging from Bakken wells with crude oil. Gas processing constraints are well on their way to being solved, thanks to the addition of a number of new processing plants in 2019 and early 2020, and the late-2019 startup of the Elk Creek NGL pipeline that will help folks deal with all the mixed NGLs coming out of those processing plants.

More at the link. Archived.