MRO With Four New Permits In Reunion Bay -- June 19, 2020

Amtrak to cut service to Williston to three times weekly. Link here. Due to Wuhan flu, ridership has dropped 90%. Huge financial shortfalls. May be lucky to get back to 50% capacity by 2021.

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Back To The Bakken

Active rigs:

$38.84	6/19/2020	06/19/2019	06/19/2018	06/19/2017	06/19/2016
Active Rigs	12	62	61	56	28

Four new permits, #37654 - #37657, inclusive:

• Operator: MRO
• Field: Reunion Bay (Mountrail)
• Comments: 
• MRO has permits for four wells in lot 2 section 5-150-93, Reunion Bay: a Medicine Crow USA well; a Howling Wolf USA well; a Joba USA well; and, an Albert USA well; all 375' FSL and all about 2250' FEL

Three Crescent Point Energy wells acquire by Hess:

• 21158, Elena, Williams County,
• 21159, Lloyd, Williams County,
• 19041, Njos, Williams County,

Breaking News: PGA Player Tests Positive For Covid-19 -- June 19, 2020

Food: I don't know about the rest of the country, but here in north Texas the grocery stores are more than back to normal.

No shortages of anything.

Yes, on any given day, I might not find something I'm specifically looking for but in general, there are no shortages.

I was reminded of that looking through an old issue -- June 11, 2020 -- of The New York Review of Books. A UC-Berkeley professor has a lead article telling us about the shortages in the American food supply due to Covid-19. The title of the essay: "The Rot in our Food Supply." Wow, talk about a story that had no legs. Yes, there was a "relative" meat shortage early on but from what I can tell, there's more than enough escargot, fish, chicken, eggs, lamb, pork, and beef. After getting the gist of the article in the first three paragraphs, and realizing Mike must be living on a planet different than the one I am living on, I skimmed the rest of the article, and was unable to find any recommendations on how to make things better.

Comment: the only "good" thing about this essay was to remind me how incredibly wonderful a free market really is.

India: only one other essay worth writing about in the same issue -- "The Pillage of India," by Christopher de Bellaigue.

The author reviews two books, including one I recently bought through Amazon and am slowly working my way through: The Anarchy: The East India Company, Corporate Violence, and the Pillage of an Empire. I bought the book simply to learn more about the history of India since so many of my neighbors are first and/or second generation Indians. I haven't read that essay yet; in fact I did not even notice the essay until I was getting ready to use the magazine pages for tinder for my Weber grill chimney. The current issue of The New York Review of Books arrived yesterday and critical mass in my little hovel will be reached if I have more than one issue of The New York Review of Books.

Breaking news: PGA player tests positive. OMG. Just when they were getting back to live play. I'm not sure if we will get through this weekend; the question is whether they will stop the tournament currently under play.

Food. Back to food. I have never grilled so much as I have grilled in the past few weeks. There are many reasons for that, but suffice it to say:

• salmon: 18 minutes, on a water-soaked cedar plank, indirect heat, but close to the coals;
• flank steak: 90 seconds directly on lump natural charcoal, fifteen minutes in foil, following; salt/pepper rub;
• Teres major: 18 minutes, indirect heat; hot coals; salt/pepper rub; and maybe 16 minutes if the cut is relatively small;
• beer-can chicken: 1.25 hours; various rubs; 
• corn, ears, in the husk, well soaked: 20 minutes, tops

From the current issue of The New York Review of Books, the following:

Police brutality, Chicago, 1972 - 1991: "A Legacy of Torture in Chicago," Peter C. Baker, a freelance writer in Evanson, IL. It should be a very interesting read; I'm always interested in learning more geography:

• Area 2: in the predominantly black South Side
• Area 3: city's southwest side
• Homan Square: an off-the-books interrogation site in the North Lawndale neighborhood
• it appears there are three areas "ripe" to become North America's next autonomous zones; what's stopping them -- even lightweights in Seattle managed to take downtown Seattle, and bantamweights in Minnesota took over Minneapolis; certainly heavyweights in Chicago can do as well, if not better;

"Mexico's Ruinous Messiah," Enrique Krauze, writer and recognized authority on Mexico. The writer adds AMLO to his list of despots, to include Turkey's Erdogan and Venezuela's Maduro. Who would have guessed. Should be a fascinating essay. I'm surprised to see it in TNYROB, and I'm surprised the editors accepted it, agreed to print it despite naming Maduro in the list of tyrants.

The scientific method, an essay by Jessica Riskin, teaches history at Stanford.

So, lots to read.

In addition, I am reading a chapter a night of White Mischief, James Fox.

Last week:

It has come down in price since I last checked about a week ago:

Disclaimer And Notes

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.

Note: I post a  lot of new notes every day; I update many older notes every day. I often make content and typographical errors. I try to post links "everywhere" to make it easier to fact check -- at least fact-check the source from which I got the item.

Note: I am inappropriately exuberant about the "Bakken."

Note: I often intersperse factual content with personal comments and opinions. It is difficult to tell what might be my opinion -- see one of the notes above.

Note: except for my inappropriate exuberance about the "Bakken," I don't have any hidden agenda with regard to the Bakken. With non-Bakken items, I very likely have agendas which may or may not appear obvious.

I'm off the net for awhile.

Third Generation Monster Wells Have Been Updated -- June 19, 2020

I track 3rd generation monster wells at this site.

I assume this well has recently been posted, but I don't recall. Regardless, this 3rd generation monster well just went over 500K bbls crude oil in less than two years:

• 33813, 1,595, Petro-Hunt, USA 153-95-23D-14-2H, 43 stages; 5.4 million lbs; Charlson, t7/18; cum 507K 4/20;

This monster well is now back on line:

• 2294, 2,320, CLR, Holstein Federal 13-25H, Elm Tree, t11/16; cum 806KK 4/20; came off line 11/19; back on line 3/20;

Another 3rd generation CLR monster well is now well above 500K bbs cumulative, crude oil:

• 31357, 1,102, CLR, Nashville 2-21H, Catwalk, 40 stages, 8.7 million lbs, t6/16; cum 510K 4/20; easily exceeding a 900,000 bbl-EUR type curve

This Slawson monster well went off line in January, 2020, with intermittent production since then; it may be coming back on line:

• 31278, 4,862, Slawson, Torpedo Federal 10H, Big Bend, t12/18; cum 567K 4/20; TD: 25,490 feet; see this post;    

A Three Forks, first bench well:

• 19296, 2,388, SHD, Golden 22-31H, Deep Water Creek Bay, TF Bench 1, 62 stages, 15 million lbs, t3/15; cum 781K 4/20;

And, we'll close with this one:

• 30541, 4,871, Bruin, Fort Berthold 151-94-26A-35-4H, t6/18; cum 661K 4/20; 

Re-Posting: Saudi's Highly Successful Effort To Flood The US With Oil -- June 19, 2020

One of my favorite posts this past week: Saudi Arabia's plan to flood the US with oil was highly successful. A contributor to oilprice agreed:

• how Saudi Arabia caused the worst oil price crash in history; link here.

If Russia Is Happy With $50-Oil, Saudi Is In Deep Doo-Doo; Iraq Is In Even Worse Shape -- June 19, 2020

This is really, really cool.

Earlier today I posted:

Saudi breakeven: from "lower for longer," oilprice:

Normally, a forced production cut in U.S. shale would have been enough for a price rebound to levels that would allow the Gulf economies’ budgets to break even.

It is this breakeven that is important to them, not production costs that are notoriously the lowest in Saudi Arabia.

For all these low production costs, Riyadh needs $78.30 a barrel of Brent to clear its budget, and $58.10 a barrel of Brent to clear its current account.

And things are not much different for its Gulf neighbors.

Russia: happy with $50-oil. 

OPEC basket, today, link here: flat at $37.70.

What makes this so "cool," and interesting is the fact that back on June 12, 2020, I did my own calculations based on public data provided by Saudi Arabia and others, and came up with these figures:

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.

My hunch: my figures are closer to "reality" than others.  But even if not, $58.10 is a bit of a jump from $40, and the latter is far below $80.

I wonder if Art Berman pays attention to these numbers. But I digress. CLR is happy enough with these numbers to resume production.

Friday, June 19, 2020

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

AAPL: pre-market trading, AAPL just hit its all-time intra-day record high of $355.40 before falling back to $355.30. Gonna be an interesting day. This is Friday, isn't it, going into a weekend?

Saudi breakeven: from "lower for longer," oilprice:

Normally, a forced production cut in U.S. shale would have been enough for a price rebound to levels that would allow the Gulf economies’ budgets to break even.

It is this breakeven that is important to them, not production costs that are notoriously the lowest in Saudi Arabia.

For all these low production costs, Riyadh needs $78.30 a barrel of Brent to clear its budget, and $58.10 a barrel of Brent to clear its current account. And things are not much different for its Gulf neighbors.

Russia: happy with $50-oil. 

OPEC basket, today, link here: flat at $37.70.

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Buffett Spreadsheet

	Airline	Shr Price: 3/31/2020	Dollars: 3/31/2020	Shares	Shr Price: June 19, 2020	Total: June 19, 2020
	DAL	28.53	675,000,000	23,659,306	31.58	747,160,883
	UAL	31.55	675,000,000	21,394,612	40.44	865,198,098
	AAL	12.19	675,000,000	55,373,257	16.92	936,915,505
	SWA (LUV)	35.61	675,000,000	18,955,350	36.46	691,112,047
			2,700,000,000			3,240,386,533
	AAPL	254.29	2,700,000,000	10,617,799	355.42	3,773,777,970
						533,391,437
						3,240,386,533
						16.46%
March 24, 2020		224		10,617,799		2,378,386,881
6/19/2020		355		10,617,799		3,769,318,495
						1,390,931,614

After Being Off Line For Almost A Year, A Zavanna Usher Well Comes Back Strong -- June 19, 2020

The well:

• 24696, A, Zavanna, Usher 28-21 1H, Poe, t1/18; cum 250K 3/20; off line from 4/19 to 1/20; I assume this was the well holding the lease by production; see this post;

The Zavanna Usher / Stranger wells are tracked here. 

Recent production:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	4-2020	30	10313	8369	21873	12594	11660	487
BAKKEN	3-2020	31	12819	11589	29882	20333	18166	1705
BAKKEN	2-2020	27	3129	2702	17340	47571	36946	10193
BAKKEN	1-2020	10	133	117	2347	6022	1190	4683
BAKKEN	12-2019	0	0	1	0	0	0	0
BAKKEN	11-2019	2	0	0	4032	30	0	0
BAKKEN	10-2019	0	0	0	0	0	0	0
BAKKEN	9-2019	0	0	0	0	0	0	0
BAKKEN	8-2019	0	0	0	0	0	0	0
BAKKEN	7-2019	0	0	0	0	0	0	0
BAKKEN	6-2019	0	0	0	0	0	0	0
BAKKEN	5-2019	0	0	0	0	0	0	0
BAKKEN	4-2019	7	3197	4391	2334	6558	5755	699
BAKKEN	3-2019	27	8856	8526	7768	19386	13905	1393
BAKKEN	2-2019	28	7944	6990	8687	20910	13770	182
BAKKEN	1-2019	22	4697	3843	6746	16280	9362	506

WTI Briefly Hits $40 Overnight -- June 19, 2020

First things first:

• WTI goes above $40 overnight; drops back a bit. Woo-hoo! 
• buzz word you will see all day today: backwardation (a bullish sign; no incentive to store oil to sell at a later date)
• China to accelerate US farm purchases after Hawaii talks, link here; 

Continental Resources (CLR): will resume production in July, 2020; will maintain 50% curtailment, link here at SeekingAlpha;

• Continental Resources (NYSE:CLR) says it will partially begin resuming production in July but still expects to curtail roughly half of its operated oil production
• the company previously announced it would curtail 70% of operated oil production in May, with continued curtailments into June
• Continental expects total production will average 150K-160K boe/day in June, increasing to 225K-250K boe/day in July; Q2 output is forecast at 200K-205K boe/day.

Fast and furious: oilprice.com stories that deserve a second look; comments later, perhaps:

• Oman is building the largest oil storage facility in the Middle East. Link here. 
• how Saudi Arabia caused the worst oil price crash in history; link here. 
• surprise draw in fuel inventories boosts oil prices, link here.
• gasoline production at Russian refineries at 15-year low, link here;
• here we go again, underinvesting could send oil prices soaring, link here;
• FWIW: China's emissions jump the most since 2011, link here;
• Aramco cuts hundreds of job amid oil price collapse, link here;

Other stories we may come back to later:

• Apple's mobile economy is bigger than you think, link here;
• Apple will close some recently re-opened stores in the Carolinas (north and south); Florida, and Arizona;
• $190-oil in 2025? JPMorgan says it's possible; link here; I think "they've" also said $10-oil is possible; covering all bases;
• daycare, childcare, and Covid-19, link here;

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Back to the Bakken

Active rigs:

$39.85	6/19/2020	06/19/2019	06/19/2018	06/19/2017	06/19/2016
Active Rigs	12	62	61	56	28

Three wells coming off the confidential list today:

Friday, June 19, 2020: 46 for the month; 191 for the quarter, 418 for the year:

• 37058, conf, CLR, Angus Federal 9-9H, Elm Tree,
• 35677, conf, CLR, Boston 9-25H1, Brooklyn,
• 35674, conf,CLR, Boise 0-24H1, Brooklyn,

RBN Energy: shippers take sides on Enbridge's Mainline recontracting plan, part 2.

Enbridge’s proposal to have crude oil shippers on its now fully uncommitted Mainline sign long-term contracts for as much as 90% of the 2.9-MMb/d pipeline network’s capacity is a big deal — and controversial. Refiners and integrated producer/refiners generally support the plan, which is now up for consideration by the Canada Energy Regulator, while Western Canadian producers with no refining operations of their own — and, for many, no history of shipping on the Mainline — mostly oppose it.

What’s driving their contrasting views?

It’s complicated, of course, but what it really comes down to is that everyone wants to avoid what they see as a bad outcome. Refiners and “integrateds” fear that if the current month-to-month approach to pipeline space allocation remains in place, cost-of-service-based tariffs on Mainline will soar when new takeaway capacity is built on the Trans Mountain and Keystone systems and fewer barrels flow on Mainline. Producers, in turn, are wary of making multi-year, take-or-pay commitments to Enbridge if they’ll soon have other takeaway options, and are equally concerned that they’d be left in the lurch if they don’t commit to Mainline and the Trans Mountain Expansion and Keystone XL projects don’t get built. Today, we consider both sides of this important debate.

Rigs Don't Matter -- Natural Gas -- June 19, 2020

I have no idea what the oil and gas rig count is but I understand it's down a bit year-over-year.

But that doesn't seem to affect the natural gas fill rate.  Again, this should not be taken out of context.

Link here.