Two Groups Of Wells That Have Been Updated -- June 12, 2020

The Ogden wells: starting to produce; moderately good wells.

The Rink wells: updated; not particularly remarkable; very nice Bakken wells.

Notes From All Over -- The Evening Edition -- June 12, 2020

TCM: Victim. From wiki --

Victim is a 1961 British neo noir suspense film directed by Basil Dearden and starring Dirk Bogarde and Sylvia Syms. It was the first English-language film to use the word "homosexual."

It premiered in the UK on 31 August 1961 and in the US the following February. On its release in the United Kingdom it proved highly controversial to the British Board of Film Censors, and in the U.S. it was refused a seal of approval from the American Motion Picture Production Code. 

I don't know if I will enjoy the movie, but the first fifteen minutes are intriguing and the movie, black and white, certainly "holds up well," as they say. Had I not spent half a dozen years in England, I might not have been "hooked" on continuing to watch after the first fifteen minutes.

The very first frame: the UK prohibited anyone under the age of 16 to see the film. At thirty minutes or so into the movie, my first thought: wow, this is so like an Alfred Hitchcock movie. Later: great, great movie. Anglophiles, I would think, would enjoy it. I never really understood the meaning of "Roman holiday" until seeing this movie. Wow.

Re-Opening: I'm starting to get "circulars" and third-class junk mail from places we used to frequent but closed due to the corona virus.

An example: today we received a notice from our favorite fine arts museum here in the DFW area telling us they were now open for their annual subscribers (which we are) with strict social distancing rules. My reaction is interesting: I really don't care any more. Somehow it almost feels like a jilted love affair. For months I was told to stay away, through no fault of their own; they were forced to close by a judge's declaration. But just the same, I feel abused, through no fault of the fine arts museum, but still.....it's completely irrational, I know, but that's the way it is.

I wonder if they will extend our annual subscription -- after all we were not allowed to visit for several months?

I've learned over seven decades of life -- almost eight --  that one's feelings/experiences are often not unique. If so, a lot of re-opening venues will have to work very hard to get their "lovers" back. We've learned to live without them; we have found new relationships.

I can think of a half-dozen places I will probably never frequent again, at least the way I'm feeling now.

Wuhan flu:

• Sweden
• Norway

NRFPT -- June 8, 2020

Wow, again I'm in a great mood, but things are moving too quickly to keep up.

NRFPT: Regular readers might have noticed a new "acronym" on the blog: NRFPT. I'm going to try this out for a while, see if it works. Every days, it seems, there's some data I want to get posted as fast as possible, but if I waited until the post was complete it might take days to post.

If I have something I want to post, and even if it does not meet the high standards of the blog, I may post it anyway but note that it's not ready for prime time (NRFPT). My plan is to eventually get back to the post and "complete" it -- I may or may not get around to it, but at the least the data I want posted is posted. NRFPT also means there may be more typographical and/or content errors than usual.

So, we'll see.

DVDs: I see that two of my favorite films are now part of the Criterion Collection; maybe they have been part of the Criterion Collection for years but I only noticed them today: Mulholland Drive, Director's Cut, and The Grand Budapest Hotel. The former is available at our local Barnes and Noble store, full price, somewhat expensive, and I can't find it on Amazon -- strange. It's probably there, I just  haven't found it yet. The latter, The Grand Budapest Hotel, is available through Amazon. Not sure yet if I will buy one, both, or neither. Later: I did end up buying the Mulholland Drive DVD.

Memo to self: blog ranking. How many websites are there on the Web? Upwards of two billion and rising by about 1,500 every twenty-four hours.

DuckDuckGo: some analyst over at Barron's suggests Apple should "buy" DuckDuckGo as a search engine instead of relying on Google. Wow. Wrong on so many levels. The analyst obviously doesn't "understand" Apple.

NDIC: The Bakken Is Dead -- June 12, 2020

The daily activity report:

Active rigs:

$36.26	6/12/2020	06/12/2019	06/12/2018	06/12/2017	06/12/2016
Active Rigs	12	61	62	53	28

Featured link: Will America’s Pipeline Operators Survive The Oil Crisis?

Notes From All Over, End-Of-Week -- Early Evening Edition -- June 12, 2020

TCM: tonight's feature presentation, Our Betters, 1933, pre-code. Wiki entry here. TCM's theme tonight: LGBTQ. This could be good. My hunch: it's all dialogue. A stage play on film. Apparently, the "draw": seeing Tyrell Davis as Ernest. He is the reason the picture was selected by TCM to be shown tonight, and yet Tyrell Davis only shows up in the last five minutes of the movie, a movie that runs one hour, 23 minutes. But apparently he "steals" the show. "No one" knows anything about Tyrell Davis, and even in this movie he is uncredited. Apparently he starred in many movies but was uncredited.

My hunch: it would be like Boy George showing up in the last five minutes of Tootsie.

Minnie Pearl. The last two words in the movie, Our Betters, "Minnie!" "Pearl."

Minnie Pearl first used that stage name, as far as we know, in 1939. She would have had to come up with this name somewhat earlier. Our Betters came out in 1933. This, alone, is worth the price of an annual subscription to this blog.

For the archives, our local DDAZ:

Reality sucks: quick! Name the most dangerous "profession" in the United States. Driving trucks. Maybe not the most dangerous, but certainly among the top ten. See this story.

As cities across the country are discussing defunding or disbanding their police departments, truck drivers are voicing concerns of safety. Seventy-seven percent of truck drivers say they will refuse to deliver freight to cities with defunded police departments.

Truck driving is historically ranked as one of the most dangerous jobs in the country. In 2018, U.S. Bureau of Labor Statistic reported truck driving as the most deadly job in the country.

Truck drivers have spent the last year on the front line of a global pandemic and protests. Now many are fearful of what might happen if police departs disband or are defunded.

Insurance: I can't even imagine the insurance rates on private automobiles if one lives in a zip code which has defunded police departments. I have paid for auto insurance in several different states over the years, and location, location, location drives (no pun intended) the premium. Southern California rates are horrendous. I imagine auto insurers are looking at Minneapolis, Seattle, Portland, to name just a few.

Restaurants: you really want to go out to dinner in/near an autonomous zone, or in a city with no police department?

College campuses: no city police department? Have you seen college "police" departments? LOL.

Theater or movies in a defunded city? Walking out into the dark after the show lets out. LOL

Little Movies, Aaron Lee Tasjan

Venezuela Feeling The Heat -- Trump Is Having A Great Week -- June 12, 2020

First, it was the story out of Iran.

Now, just one day later, this story out of Cuba.

Trump is having a great week.

Venezuelan state-owned PdV is using the Cuban-flagged products tanker Maria Cristina as floating storage after shelving an earlier plan to ship some Iranian gasoline supply to Cuba, according to Venezuelan government and oil union officials.

The Maria Cristina, previously called Carlota C, arrived at El Palito in central Venezuela on 31 May. The tanker's last port of call was Moa, Cuba, according to ship-tracking data.

The vessel is one of four sanctioned by the US in September 2019 for transporting Venezuelan oil to Cuba, which the White House blames for propping up President Nicolas Maduro in Caracas.

Venezuela received gasoline from Iran in late May and early June, temporarily alleviating an acute fuel shortage aggravated by US sanctions.

US Natural Gas Exports To Mexico Hit New Record High -- June 12, 2020

This may be the best story I've read all week. It is such a great story on so many levels.

New York state may not want US fossil fuel but Mexico certainly appreciates the US. LOL.

From S&P Global Platts:

US gas pipeline exports to Mexico surged to a new single-day record high this week, propelled by warming summer weather and a soft opening of Mexico's economy earlier this month.

On June 10, US exports jumped to nearly 5.9 Bcf/d.

On June 12, evening cycle data, which could be yet revised, showed export volumes down significantly from the earlier high at an estimated 5.5 Bcf/d.

The midweek uptick on import pipelines in Mexico was widespread across nearly all of the border regions, with higher volumes on North Baja Pipeline, San Isidro – Samalayuca Pipeline, Kinder Morgan Mexico Pipeline, Nueva Era Pipeline, Tennessee Gas Pipeline and the Sur de Texas – Tuxpan Pipeline.

A 400 MMcf/d increase in south Texas exports, accounting for a sizeable portion of the gain, was driven by Sur de Texas, with most of the incremental volumes going to Tamazunchale Pipeline, which feeds large population and industrial centers in central Mexico.

After reopening economic activity in Mexico lifted US gas exports into the low 5 Bcf/d range earlier this month, volumes were propelled to the new record high mostly by weather. On June 10, population-weighted temperatures climbed to over 77 Fahrenheit, or nearly 4 degrees above normal.

For more on Sur de Texas, see these posts:

• February 27, 2020; 
• June 12, 2019;
• April 19, 2019;
• April 19, 2019, same date, different post; and,
• I'm sure there are many more if one does a blog/google search.

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For The Two New Grandsons

Age: Three Months

Sleepless In Seattle -- Update: CHAZ -- DOMTERs Request "More" Guns -- June 12, 2020

CHAZ is now tracked here.

Most recent update:

June 12, 2020: see new comments at the link above. I opined earlier that negotiations will begin by next week between "Seattle" and "CHAZ." CHAZ will start by ordering food and supplies. Wow, that didn't take long. Less than an hour later, this headline:

Media lumps "guns" in with Gatorade and cigarettes, hoping that we all somehow miss that. Open carry is not prohibited in the state of Washington.

Road To New York -- June 12, 2020

"Non-infrastructure solutions":  euphemism for "no growth."

From S&P Platts Global: New York activists target National Grid gas project after Williams shelves pipeline.

Emboldened by the recent cancellation of a fiercely disputed natural gas pipeline project, climate activists are now looking to defeat National Grid USA's top alternative for addressing a downstate New York supply crunch.

Dozens of environmental groups have asked Governor Andrew Cuomo and the New York State Public Service Commission to reject any option that would increase gas supply into New York City and Long Island. That includes National Grid's recommendation to build LNG vaporizers and enhance compression on the Iroquois Gas Transmission System.

The groups instead want New York to opt for non-infrastructure solutions, including energy efficiency and demand response measures and electric heating system adoption.

Much more at the link.

Legacy Fund Deposits -- June, 2020

Later;

North Dakota Legacy Fund site.

Link here. North Dakota's oil tax savings account next week will see its lowest-ever monthly deposit.

State Treasurer Kelly Schmidt told the Tribune on Friday that the Legacy Fund on June 19 will receive about $10.24 million from oil tax revenue, the "lowest deposit in history," reflecting April oil production, collected in May and distributed in June.

The sum is half the previous record-low deposit: $20.46 million in April 2016, amid sagging oil prices that heralded deep budget cuts for the state [during the first Saudi surge].

The Legacy Fund had about $6.6 billion as of April 30. Its record monthly deposit is $117.16 million made in August 2014 [just before the first Saudi Surge began].

Its average deposit is $54.7 million a month.

The state's longest-serving treasurer said the deposit is a reflection of plummeted oil prices and production amid the coronavirus pandemic -- which idled thousands of wells in North Dakota's Bakken oilfield -- as well as the Saudi-Russia oil price war.

In fact, number of producing wells (link here, and here):

• April, 2020: 15,465 (first source) (15,007 from second source)
• March, 2020: 16,280 (first source) (15,870 from second source)
• February, 2020: 15,758 (second source)
• January, 2020: 15,607 (second source)
• January, 2019, a year earlier: 15,043
• I'm not exactly seeing "thousands of wells idled in the Bakken"
• Later, from Geoff Simon:
  
  
  
  It's been widely reported that nearly 7,000 wells have been shut in, but Helms' report lists fewer than 2,200 wells on the "Inactive" list. He said that's because producers are continuing to operate many of their wells at a much-reduced rate to keep them mechanically sound.

The Bakken Vs Saudi: ExxonMobil's Decision -- June 12, 2020

Re-post, because I think it tells a story:

Saudi's petrochemical unit losing money: link here.

Saudi Arabia's state-controlled petrochemical giant Sabic last month declared a loss of 950mn riyals ($253mn) in the first quarter of this year, compared with a profit of $909 million in the first quarter of 2019.

The loss was partly the result of a fall in the average prices of its products.

Sabic is planning to cut its capital expenditure, in line with moves by other energy and petrochemical producers.

ExxonMobil has lowered its 2020 capex budget by 30pc, with the bulk of the reduction going to its Permian onshore shale operations in the US.

BP's spending cuts for this year include a reduction of around $1bn on short-cycle onshore investment and deferrals of exploration activity. Shell, Total and Chevron have also announced sharp reductions in their 2020 capex budgets.

Director's Cut -- April, 2020, Data

Updates

June 13, 2020: a reader provided this assessment of the decline in US crude oil production:

No surprise with the decline in production of oil in USA.
-Shale wells decline rate of 6-8% per month.
-Rig count down for horizontal rig count down by 70+ percent
-Horizontal wells deplete ~70% on first year on average.
-Some wells shut in due to low spot price. Generally transport costs are fixed by pipeline increasing breakeven price to oil producer.
-Bankers will not be willing to loan $$$ to oil production companies unless you see solid $50+ oil prices.
-Shale oil production is more than 50% of oil production in USA.
-Large and small oil are cutting spending for shale, but keeping the long term projects going. One can drill and complete a shale well in months, not years.

Oil in storage is no surprise.
-Looking at EIA data, most of oil in storage increase is on Gulf Coast PADD 3. Other areas are even to down. https://www.eia.gov/petroleum/weekly/crude.php#menu
-IMHO the contango purchased oil is being delivered to California and Gulf coast.
-Tanker rates have decreased for both spot and long term charters indicating that the contango oil is being delivered.

IMHO price of crude should be in the $50s in a few months due to contango deliveries and continued reduction of oil production due to drilling downturn. Before shale oil a legacy oil will drilled vertically would typically decline 10-15% per year, unlike 70% for a shale well.

Original Post

Disclaimer: usual disclaimer applies. As usual, this is done very, very quickly. It is not proofread. There will be factual and typographical errors on this page. If this is important to you, go to the source. It is generally updated in segments, so until the entire report is completed, there may be old data still present. 
Link here.

Month-over-month crude oil production decreased by 14.8% ... Saudi Surge / destruction demand due to Wuhan flu.

Comments:

• second month that "global economy" really started to tank due to Wuhan flu;
• completions: huge drop in the number of completions -- down to 58 completions (preliminary) compared to 120 the month before; but similar to a month before that, 57 in February, 2020;
• as a reminder, completions dropped from 70 wells in January, to a meager 57 wells in February (average 2.258 wells/day vs 1.966 wells/day); the greatest amount of oil produced by a Bakken well is in its first full six months after being fracked; a decrease in the number of completed wells is historically problematic;
• DUCs decreased by almost 3%; the greatest amount of oil produced by a Bakken well is in its first full six months after being fracked; a large number of DUCs were completed but that could not offset the number of new completions, 58, vs 120 in the previous month, March, 2020;
• so, DUCs decreased from 972 to 944 month-over-month but number of new wells completed plummeted from 120 (March, 2020) to 58 (April, 2020);

Disclaimer: As usual, this is done very, very quickly. It is not proofread. There will be content and typographical errors on this page. I need to check the figures later. If this is important to you, go to the source.

The Director's Cut

Data For April, 2020

North Dakota Oil and Natural Gas Production

Disclaimer: usual disclaimer applies. As usual, this is done very, very quickly. It is not proofread. There will be factual and typographical errors on this page. If this is important to you, go to the source.

Link here to past reports.

DUCs and wells off-line for operational reasons are tracked here.

A huge, huge "thank you" to Lynn Helms and his staff at the NDIC getting this information out in a timely and transparent manner. I am not aware of any other state that does such a good job providing such data.
 
Crude oil production:

• April, 2020, preliminary: 1,219,086 ( (96% from the Bakken/Three Forks; 4% from legacy pools)
• previous months:
• March, 2020, final: 1,430,107 bopd
• February, 2020, final: 1,451,681 bopd
• January, 2020, final: 1,430,511 bopd (all-time time was November, 2019)
• December, 2019, final: 1,476,777 bopd
• November, 2019, final:1,519,037 bopd -- new all-time high after final figures come in;
• revenue forecast: 1.4 million bopd
• October, 2019, final: 1,517,936 bopd -- previous all-time high
• September, 2019, final, 1,443,980 bopd -- very, very wet September that impacted oil fields
• August, 2019, final, 1,480,475 bopd (previous all-time high)
• July, 2019, final: 1,445,934 bopd (previous all-time high)
• June, 2019, final: 1,425,230 bopd (previous all-time high)
• month-over-month, bbls: decreased by 2,110,021  (April, 2020 -- March, 2020)
• month-over-month, percent: -14.8%  (April, 2020 - March, 2020)

Gas production:

• April, 2020, preliminary: 2,712,168 MCF/day
• March, 2020, final: 3,128,393 MCF/day; 87% capture;
• February, 2020, final: 3,109,750 MCF/day; 87% capture;
• Previous months: 
• January, 2020, final: 3,019,938 MCF/day; 84% capture rate (improved, month-over-month)
• December, 2019, final: 3,061,412 MCF/day; 84% capture rate (improved, month-over-month)
• November, 2019, final: 3,165,585MCF/day; new all-time high on a per-day basis; all time on a monthly basis, October, 2019)
• 83% capture
• October, 2019, final: 3,070,616 MCF/day
• 81% capture
• September, 2019, final: 2,946,391 MCF/day (note -- fell below the 3-billion threshold previously reported)
• August , 2019, final: 3,014,419 MCF/day -- an all-time high
• July, 2019, final: 2,944,816 MCF/day
• June, 2019, final: 2,885,293 MCF/day

BOE, March, 2020, preliminary:

• April, 2020, preliminary:
• natural gas: 2,712,168 MCF/day = 451,953 boe
• crude oil: 1,219,086 bopd
• total boe, preliminary for March, 2020: 1,671,039 boepd
• all-time high, November, 2019: 2,046,547 boepd

Producing wells:

• April, 2020, preliminary: 15,465
• March, 2020, final: 16,280 -- this sets a new all-time high for producing wells
• previous high for previous wells: October, 2019: 16,169
• February, 2020, final: 16,149
• January, 2020, final; 16,014
• December, 2019, final; 16,042
• November, 2019, final: 16,110
• October, 2019, final: 16,169 (new all-time high)
• September, 2019, final: 16,115
• August, 2019, final: 15,964 (all-time high was 15,954, July 2019)
• July, 2019, final: 15,954 (another new all-time high)
• June, 2019, 15,752

Wells off-line:

• May, 2020: when I went through the May, 2020, data (as it was released in early July), it was very, very obvious that ND Bakken operators shut in their wells in May, not April).
• April, 2020, preliminary
• inactive: 2,168
• DUCs: 944
• total: 3,112 (for all that talk about all the wells coming off line, that does not appear to be true in the Bakken; operators simply drilled fewer wells)
• March, 2020, final:
• inactive: 2,161 
• DUCs: 972
• total: 3,133
• March: it makes sense that inactive wells are up; DUCs are down; when DUCs are completed, neighboring wells are shut in to protect them; 
• February, 2020, final: 
• inactive: 2,091
• DUCs: 1,027
• total: 3,118
• January, 2020, final:
• inactive: 2,607
• DUCs: 1,024
• total: 3,631
• December, 2019, final:
• inactive: 1,920
• DUCs: 958
• total: 2,878
• November, 2019, final:
• inactive: 1,726
• DUCs: 919
• total: 2,645

Permitting:

• May, 2020: 59
• April, 2020: 62 (considering all that is going on, not bad)
• March, 2020: 68
• February, 2020: 60
• January, 2020: 61
• December, 2019: 67
• November, 2019: 79
• October, 2019: 126
• September, 2019: 92
• August, 2019: 127
• July, 2019: 141
• June, 2019: 127

Rig count:

• Today: 10 (all-time high was 218 on 5/29/12)
• April, 2020: 35
• March, 2020: 52 
• February, 2020: 54
• January, 2020: 55
• December, 2019: 55
• November: 55
• October: 56
• September: 61
• August: 62
• July: 57
• June: 63

Fort Berthold Reservation data partitioned out.

Completions:

• April, 2020, preliminary: a whopping decreases from previous month; down to 58;
• March, 2020, final: a whopping 120 wells were completed in March, 2020
• February, 2020, final: 57
• January, 2020, final: 70 (revised)
• December, 2019, final: 88 (revised)
• revenue forecast: 90
• November, 2019, final: 92
• October, 2019, final: 102
• September, 2019, final: 117 (revised up from 94) (revised a second time, up from 112)
• August, 2019, final: 102
• July, 2019, final: 137
• June, 2019, 102 (revised, last month's report); revised again, now, 123
• May, 2019, 113 (final)

 Gas capture:

• statewide, captured: 88% (flat)
• statewide, captured:
• April, 2020: 2,398,014 MCF/day -- captured -- still ahead of May, 2019, which was an all-time high at that time; down 17% month-over-month;
• March, 2020: 2,711,084 MCF/day  -- final -- new all-time high
• February, 2020: 2,699,065 MCF/day (final) new all-time high
• January, 2020: 2,553,067 MCF/day (final)
• December, 2019: 2,557446 MCF/day (final)
• November, 2019: 2,594,922 MCF/day (new all-time high)
• October, 2019:  2,524,405 MCF/day
• September, 2019: 2,429,487 MCF/day
• previous all time high was May, 2019: 2,287,761 MCF/day
• FBIR Bakken:
• April, 2020: 85%
• March, 2020: 83%
• January, 2020: 83%
• December, 2019: 81%
• November, 2019: 81%
  October, 2019, captured: 70% (was 79% in September)(75% reported two months ago, August, 2019)

Off line, to end of March, 2020: 3,136 -- back in January, 2020, it was -- 3,631; 

• DUCs: 944 (down 28 from the 972 in March)
• inactive well count: 2,168 (up 7 from 2,161 in March)
• wells off line for operational reasons are tracked here;  
• if I recall correctly, December, 2019, was a fairly "mild" winter by North Dakota standards;
• January: huge jump in DUCs and inactive wells; 
• February, 2020, was a fairly mild month, as I recall; 
• March, 2020: DUCs down a bit, but inactive wells out-numbered DUCs 
• April, 2020: Saudi Surge; demand destruction; WTI plummeted in price;

A year earlier, April, 2019, the "off-line well" data:

April, 2019:

• DUCs: 962, down 6 from last report
• inactive: 1,625, down 72 from last report
• total: 2,587 (down from 2,664 last month; this represents about 1,000 more wells than will be drilled this calendar year; 2,561 is about what North Dakota will complete every three years)

Rig count:

• Today: 10
• May: 17
• April: 35
• March: 52
• February: 54

Saudi Arabia, Iraq In Deep Doo-Doo, Update #23 -- June 12, 2020

Market sell-off yesterday and now this: price of oil keeps falling. Linked at the sidebar at the right.

Saudi called for a 2020 budget based on $110-oil when that budget released in late 2019.

Revised budget and revenue projections in early 2020 moved their target to $84-oil.

Last statement from Saudi Sam aka Alfalfa, former energy minister: "We are comfortable with $30-oil."

By the way, the new Saudi energy minister is Prince MbS's son, Prince AbS, or Prince ABBA as his friends call him.

Since then:

• demand destruction;
• plummeting prices;
• foreign exchange reserves at historic lows 

Saudi's petrochemical unit losing money: link here.

Saudi Arabia's state-controlled petrochemical giant Sabic last month declared a loss of 950mn riyals ($253mn) in the first quarter of this year, compared with a profit of $909 million in the first quarter of 2019.

The loss was the partly the result of a fall in the average prices of its products.

Sabic is planning to cut its capital expenditure, in line with moves by other energy and petrochemical producers.

ExxonMobil has lowered its 2020 capex budget by 30pc, with the bulk of the reduction going to its Permian onshore shale operations in the US.

BP's spending cuts for this year include a reduction of around $1bn on short-cycle onshore investment and deferrals of exploration activity. Shell, Total and Chevron have also announced sharp reductions in their 2020 capex budgets.

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

The Big Question: Who Swoops In To Swallow Up Iraqi's Oilfields? 

China or Russia

Iraq fighting for its very survival. Link here. What did Iraq do with all that money the past several years?

June 11, 2020

Gasoline demand: pundits can say what they want, but at the end of the day, the one metric that drove today's market and the drop in the price of crude oil was the gasoline demand that was reported yesterday.  The four-week average demand spooked the market -- and it WAS bad. But the "one-week" was good, in fact, considering, it was great, so we will see next week.

Don't take that out of context: it was not the metric per se. It was what the metric -- gasoline demand --  represents. "Jay" has it right: it's going to be a long, hard slog. But we're going to be just fine.

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.

AAPL: although shares fell yesterday, AAPL was the first to hit a market cap of $1.5 trillion.


AAPL: iPhone owners are spending a ton of money in the App Store -- The Motley Fool.

iPhone sales might be down for Apple (NASDAQ:AAPL) amid the coronavirus pandemic, but Apple users are spending a lot more in the App Store while staying indoors. App Store sales climbed 35% in the first two months of Apple's third quarter, Morgan Stanley analyst Katy Huberty estimates. Importantly, growth accelerated from April to May, even as economies started to reopen.

"High levels of engagement have sustained as the 'new normal' (at least in the near-to-medium-term) includes more time spent indoors, which should remain a tailwind to App Store performance," Huberty wrote in a note to investors.

Overall, Huberty expects strong App Store sales to lead to a 16.7% increase in services revenue for Apple versus the 12% she previously modeled. That's over $500 million in additional revenue. Considering that the App Store is one of Apple's highest margin services, that revenue will likely produce a profit margin well above Apple's average services gross margin of about 65%.

Rogaine. Thank goodness for Rogaine. I've been using it for decades. Now there's a report out there that "bald men may be hit harder by coronavirus -- scientific study. No link. I'm sure the story is easy to find. 

TCM tonight: wow, this will cheer you up -- or at least put things into perspective -- The Glenn Miller Story, starring James Stewart. Wow, what a great country. Meanwhile, sleepless in Seattle. The only thing I've never figured out: why "Harry Morgan"?  He pops up everywhere. Why? I couldn't watch the ending; I know how it turns out. Too difficult for me to watch.


The Nightingale, Julee Cruise

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More Sophia Stories

1. Sophia, our five-year-old granddaughter, thought I looked sad today. I wasn't. She suggested that I was sad because I had no one to sleep with. She is aware I'm home alone; Grammy is in Portland, Oregon. Sophia insisted I take one of her fluffy/stuffed animals home so I would have something to sleep with. I kid you not. So, I now have a fluffy teddy bear in the twin bed in our apartment. That's important to know so if I die in my sleep, you can tell the coroner why there was a teddy bear wearing a train conductor's hat in bed with me.

2. When I picked up Sophia from TutorTime she looked very, very sad. I thought she was going to cry. She was sad to leave TutorTime (I picked her up at the usual time). But after summer camp ends at 4:00 p.m. she gets time to spend with her other friends. Today they were playing with their Barbie Dolls and they were going to let Sophia play with them even though she did not have a Barbie Doll.

I took Sophia back in and was getting ready to call Jessica to ask if Sophia could stay another hour. Her Montessori teacher, Ms Nisha (short for a 23-letter Indian name with 15 vowels) asked what the problem was. We told her. Ms Nisha reminded Sophia that she would have the entire Tuesday next week to play with her friends and their Barbie Dolls. Apparently Summer Camp Tuesday is Barbie day. Sophia jumped up and down, she was so excited. Ms Nisha saved the day. We got in the car and headed home.

3. On the way home, Sophia said she would like to go to Tom Thumb (local grocery store) to buy a Barbie Doll because she did not have one. We went to Target instead. On the way, she suggested she should get two. I said we would look at the prices. Individual Barbies are $9.99 which is a very, very fair price (American Girl dolls were across the aisle -- LOL). But some Barbies came with a real occupation and all the accessories for $19.99. So she had her choice: two $9.99 plain Barbies or a really, really nice decked-out $19.99 Barbie. She chose the latter but she had a hard time choosing between two. The two finalists: Barbie the dentist or Barbie the international jet setter. The latter came with decals. In the end, she chose Barbie the dentist because it reminded her of her dental visits.

On the way home, I was watching her in the rear-view mirror. Her eyes got very big. She was quite shook up. She went into a monologue: "I should have gotten Barbie the traveler. But, no, that is not a good idea. Melia (one of her friends) has Barbie the traveler and if I got the same Barbie the traveler, we would get them mixed up. And if Melia doesn't wash her hands she will leave corona virus on her Barbie and I will get the coronavirus (I can't make this stuff up). So I'm glad we got Barbie the dentist because no one else has Barbie the dentist."

4. I've mentioned that whenever Sophia sees "Subscribe to my channel" on her YouTube videos on my iPad, it interferes with her watching the video, so she just clicks on "Subscribe to my channel." So now, I'm subscribed to a gazillion children's YouTube video channels.

Tonight, Sophia gave me my iPad back after she has been playing with it. It was on my Schwab Account -- the one where we have our investments. She signed out of it and then pointed out the Schwab icon at the bottom of the iPad and asked me what that icon was for. Aghast! What was she doing on my Schwab account? Well, the good news: we bought another 500 shares of Apple today. Sophia thought we needed more apples. LOL. Most of that story is true.

No Wells Coming Off The Confidential List Today -- Director's Cut Due Out Later Today -- June 12, 2020

Italian lives matter: Governor Andrew Cuomo, NY, does not favor removing a statue of Christopher Columbus. Over at twitter. Maybe they could replace it with a statue of Eric the Red.

Yesterday's sell-off due to:

• spike in corona viruses; Houston, TX, looking to re-instate "stay-at-home" orders;
• gasoline demand;
• the "Fed" 

Saudi surge:

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Back to the Bakken

Wow, who wudda guessed: a Marcellus LNG firm sees opportunities in the Bakken and the Permian. Link here. That was the headline but the "Bakken/Permian" angle is buried in the story and seems to be a small component of the overall story. They story concerns Edge LNG which uses "Cryobox" liquefaction units mounted on trucks to transport natural gas produced from "stranded wells." Little story, big headline:

Active rigs:

$36.42	6/12/2020	06/12/2019	06/12/2018	06/12/2017	06/12/2016
Active Rigs	13	61	62	53	28

No wells coming off the confidential list today.

RBN Energy: northeast gas production cutbacks tighten regional balance, for now, part 2.

U.S. Northeast natural gas production has tumbled nearly 900 MMcf/d in the past month alone since EQT Corp., Cabot Oil & Gas, and others began curtailments in response to low gas prices, and is averaging nearly 2 Bcf/d below last November’s peak of 32.9 Bcf/d. But regional gas demand has lagged this year, storage inventories have surpassed five-year highs and outbound flows to the Gulf Coast are being challenged by reduced takeaway capacity and drastically lower demand from LNG export facilities.  Today, we examine the net impact of these competing fundamental factors on the region’s supply-demand balance and the resulting implications for Appalachian supply prices.

The potential for an extended period of lower crude oil prices has opened a window of opportunity for the gas-focused Marcellus/Utica production region — lower oil prices and a prolonged pullback in oil-directed drilling, the thinking goes, would curb associated gas production from those wells, possibly tightening the gas supply-demand balance and boosting gas prices enough to spur more gas-directed drilling.

But, as we said in part 1 of this series, in the near term, Northeast gas producers, who only in the past year or so emerged from a years-long battle with pipeline constraints, are facing new challenges to regional supply growth. Appalachian producers began laying down rigs and slashing capital spending last year, well before either the oil market mayhem or COVID pandemic hit, in response to sub-$2.00/MMBtu natural gas prices in the region and overall weakness in Henry Hub benchmark futures prices. That price pressure has not let up since, as the regional and national storage inventories continue carrying hefty surpluses versus prior years. Additionally, LNG exports — a key driver of gas demand for U.S. production, including a large chunk of Marcellus/Utica outflows — have slowed dramatically, as the economics behind sending U.S. gas overseas have collapsed and LNG cargoes are being cancelled in droves.

We should note too that the reduced demand for feedgas demand at liquefaction and LNG export facilities has coincided with restricted southbound capacity to the Gulf Coast from the Northeast, following an explosion in early May 2020 on the Texas Eastern Transmission pipeline, or TETCO. Much of the production that was previously flowing south on TETCO was rerouted to other takeaway pipes, so this hasn’t necessarily affected overall supply volumes, though it may have shifted the direction of some of the flows.