One Well Coming Off Confidential List -- April 30, 2021

Summer gasoline shortage:

• perhaps in some areas, but I don't see any long lines or restrictions in filling one's tanks, except in very limited areas due to one-off events
• more likely: significantly higher gasoline prices:
• recent headline: trucking industry could trigger gasoline shortage this summer -- say what?
• a truck driver shortage could cause gas stations to "scramble" to meet supply demand
• clickbait: not gonna happen.

Saudi imports: US oil imports from OPEC plunge to lowest level since 1973;

• OPEC average: 816,000 bopd (2020)
• US imports from Canada have increased; US needs heavy oil for its refineries (which were configured for heavy oil, not light oil -- which by the way is why one can argue "killing the Keystone" was good for the Bakken
• between 2005 and 2020, US crude oil imports from Canada more than doubled to an average of 3.6 million bpd
• total American crude oil imports have dropped by 42% since their peak in 2005, and averaged 5.9 million bpd in 2020, the lowest since 1991
• the mini-Bakken boom began in Montana in 2000; the Bakken boom began in North Dakota in 2007;

DVN: announced earlier -- raised dividend from 11 cents to 30 cents (quarterly); almost tripling its quarterly dividend; Devon recently acquired WPX.

EOG: announced earlier -- raised dividend from 37.5 cents to 41.2 cents (quarterly); a 10% increase in the quarterly dividend.

SRE: announced earlier -- raised dividend from $1.045 to $1.10 (quarterly); a 5.3% increase.

Consumer sentiment:

• 88.3 vs 873.
• highest since March, 2020

Earnings (or not):

• AMZN: 
• crushes expectations
• on a down day for the market, AMZN up nicely; up almost 2%
  
• XOM:
• first profit since 2019;
• here;
• forecast: 59 cents/share;
• CVX:
• here;
• forecast: 90 cents/share;
• PSX:
• fifth straight quarterly loss on winter storm impact;
• a loss of $1.49/share vs $1.40/share forecast;
• PSXP:
• here;
• ABBV:
• forecast: $2.83/share
• actual: $2.95
• shares pop on earnings beat; raises 2021 profit outlook;

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Back to the Bakken

Active rigs:

$63.81	4/30/2021	04/30/2020	04/30/2019	04/30/2018	04/30/2017
Active Rigs	16	31	64	61	49

One well coming off the confidential list -- Friday, April 30, 2021: 24 for the month, 24 for the quarter, 105 for the year:

• 37151, drl/A, Petro-Hunt, USA 153-95-2A-11-2H, Charlson, first production, t--; cum --;

RBN Energy: the Montney's increasing doinance in western Canadian natural gas production. 

In just a few years, the Montney Formation has become the most prolific natural gas production area in Western Canada. Starting from zero in 2005, the Montney has been the primary growth engine for gas supplies and continues to challenge producers to deal with its vast geographic extent and enormous reserve potential. Spread across swaths of Canada’s two westernmost provinces, the formation’s unique geology has meant that its gas production growth has moved at different speeds depending on location, geology, and pipeline access. In this first part of a three-part series, we take a closer at this celebrated formation.

It wasn’t so long ago that Western Canada’s natural gas production growth was thought to be largely tapped out. After an initial surge in output from the late 1990s into the mid-2000s, production began to slip, as output from conventional shallow gas wells that had driven the jump in supply flattened and then started falling. The hope for coalbed methane-based production that emerged in the mid-2000s was quickly dashed, leaving gas producers searching for new areas to explore with greater intensity and new technologies.