Thursday, March 4, 2021

Decisions, Decisions, Decisions -- March 4, 2021

Really long term: 

  • coal or wind turbines

Long, long term:

  • Cancun or Mars

Long term:

  • CVX, COP, XOM (oil-focused) vs Total, BP, Shell (renewables)

Mid-term: 

  • EVs vs ICE;

Short term:

  • Texas: lifts all Covid-19 restrictions:
  • California: recommends double-masking;

Make your bets and spin the wheel.

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Huge Jump In Production -- BR Kermit -- March 4, 2021

 The well:

  • 33977, A/IA/494, BR, Kermit 5-8-32 UTFH, Pershing, t9/18; cum 248K 12/20;off line as of 2/19; remains off-line 6/19; back on line 1/20; off line 2/20; remains off line 8/20; a well to watch; off line 1/21; see this post, full production data; recent production, apparently last fracked, 10/18:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-2021002460000
BAKKEN12-20203022979230101151353743532990
BAKKEN11-20203029665298261328061175611750
BAKKEN10-2020314116640881174897291671942412
BAKKEN9-20209117851163269952231921762269
BAKKEN8-202010003200
BAKKEN7-202010001600
BAKKEN6-20201000000
BAKKEN5-20200000000
BAKKEN4-20200000000
BAKKEN3-20200000000
BAKKEN2-2020002040000
BAKKEN1-20202623004228009350328071538416046
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Ovintiv With Four New Permits -- WTI Rises -- Active Rigs Up One -- March 4, 2021

EVs: just for the fun of it, google: evs crash and burn.

Texas, Mississippi, and now Connecticut, apparently ... lifting capacity restrictions. When you look at all the sports events now and all the folks in attendance and all the folks not wearing masks at these events ... 

OPEC+: for the archives --

  • voted to extend current production one more month
  • want to see global oil stockpiles shrink to the levels seen in 2015 - 2019;
  • Wood Mackenzie sees Brent oil prices hitting $70 - $75 / bbl in April, pushing WTI to $65 - $70 range (at $63 today, we're almost there)
  • Saudi oil minister talked a good game, saying shale has seen its day; has run its course;
  • EOG says it can fund dividend and CAPEX with free cash flow even if WTI oil dips below $40 (I believe EOG CEO Bill Thomas on this one);
  • on the other hand, it's an existential issue for Saudi if oil trends toward $50, much less $40; 

TSLA: down 5% today, Closed at $621.

COSTCO: huge day for earnings;

  • revenue of $44.77 billion vs estimates of $43.81 billion
  • EPS of $2.14 vs estimates of $2.45 -- that might disappoint but look at on-line sales
  • on-line sales surged over 75%; 
  • expensive stock; high P/E; lousy dividend -- Later: I'm wrong. See first comment below. There's so much I miss by going too quickly; not seeing the whole picture. I love Costco. I'll have to take another look. Huge thanks to reader for taking time to write. From another reader: "I don't own, shop or really follow Costco.... but your comment on the dividend might be a bit off... Costco does seem to pay out special dividends which as I recall can be generous.... below is a copy/paste from Value Line from Costco analysis;  Special div’d of $7.00 paid in 12/12; $5.00 in 2/15; $7.00 paid in 5/17; $10.00 paid in 12/20." 
    • wow, when I make a mistake, it's a doozy. I need to stick to my knitting -- LOL. 
    • on the other hand, do the math -- calculate the dividend return incorporating those special dividends --

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. 

***********************************
Back to the Bakken

Active rigs:

$63.98
3/4/202103/04/202003/04/201903/04/201803/04/2017
Active Rigs1650685945

To the fifteen active rigs this morning, Hess adds another active rig:

  • BL-Frisinger in Williams County;

Four new permits, #38190 - #38193, inclusive:

  • Operator: Ovintiv
  • Field: Westberg (McKenzie)
  • Comments
    • Ovintiv has permits for two Rolfsrud wells and two Olson wells in NWNW 29-152-96;
      • 38190, Olson, 545 FNL 350 FWL
      • 38191, Rolfsrud, 525 FNL 350 FWL
      • 38192, Olson, 505 FNL 350 FWL
      • 38193, Rolfsrud 485 FNL 350 FNL

Two permits renewed:

  • MRO: a Saxvik permit and a Hausauer permit, both in Dunn County.

Six producing wells (DUCs) reported as completed:

  • 35746, A/SI, Zavanna, Usher 28-21 4TFH XW, Patent Gate, first production, 12/19; t--; cum 105K 12/20; off line 1/21;
  • 35747, A/SI, Zavanna, Usher 28-21 3H, Poe, first production, 1/20; t--; cum 198K 1/21;
  • 35748, A/SI, Zavanna, Usher 28-21 2TFH, Poe, first production, 12/19; t--; cum 142K 1/21;
  • 35879, A/SI, Zavanna, Usher 28-20 5HXW, Patent Gate, first production, 12/19; t--; cum 186K 1/21;
  • 36004, loc/A, BR, Rink 4-1-5MBH, Pershing, first production, t--; cum --;
  • 37510, drl/A, Hess, EN-Vachal LLLP-154-94-2029H-3, Alkalie Creek, first production, t--; cum --;
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Natural Gas Fill Rate -- March 4, 2021

Link here. 

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Something Happened In The Mideast Or So It's Being Reported -- March 4, 2021

Link here.

Oil prices:

  • WTI: up 5.11%; up $3.13; trading at $64.41
  • Brent: up 5.10%; up $3.27; trading at $67.34
  • OPEC basket: down 3.53; down $2.27; trading at $61.97

Or is it this? ZeroHedge attributes surge in oil prices due to OPEC+ agreement to keep output unchanged. Link here. 

See also: SeekingAlpha.

It will be interesting to see if US oil companies stay focused on free cash flow rather than on production.

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Idle Comments On That 20+ Million-Bbl Build Last Week -- March 4, 2021

That 20+ million bbl crude oil build could have been 30-million bbls. See this link. Some things to consider with regard to the Texas February Freeze:

  • prior to the EIA weekly report, there were forecasts that there would be a 2-million-bbl withdrawal, which is/was very much in line with previous reports, and typical of weekly EIA petroleum reports;
  • in the big scheme of things, nationwide, there was not much of a drop in economic activity across the US during the Texas February Freeze, February 15 - February 19, 2021
    • even in Texas, the overall economic activity probably did not drop all that much; 
    • in fact, hotels were booming; plumbers were busier than ever; propane dried up, it was in such demand; 
    • confirmed by no change in gasoline demand, a pretty good indicator of economic activiity;
  • reports were coming out of the Permian that "everything" was shut down; i.e., no crude oil production;
  • reports within days following the unfavorable event suggested that refineries, though hit hard, were opening up
  • there were reports that one out of seven service stations in north Texas were out of gasoline, I didn't see that; hurricanes cause much more regional trouble
  • gasoline demand remained pretty much unchanged week/week according to this week's EIA report
  • I'm hoping that RBN Energy blogs about that 20+ million bbl build -- in hindsight, it all makes sense, but it certainly seems to have caught analysts off guard

Cushing:

  • according to wiki: crude oil tanks around Cushing have approximately 91 million bbls of storage capacity;
  • from a reader citing ZeroHedge:
  • API had Cushing +732k barrels; EIA had Cushing +485k
  • in other words,
  • the EIA reported a 20+ million-bbl build in crude oil in the US last week
  • EIA and API both had Cushing builds well below one million bbls;
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WTI Surges 5% -- March 4, 2021

Lots of reasons, but perhaps the rocket attack on Saudi is the big one. Just saying.

Warren Buffett: CVX soaring; up 3%; hits 52-week high. Pays 5%.

CLR: hits 52-week high.

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.

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Ovintiv's Kestrel Wells In Grinnell Oil Field

The wells:

  • 34341, conf, Ovintiv, Kestrel 154-96-33-28-1H, Grinnell,
  • 34333, conf, Ovintiv, Kestrel 154-96-33-28-10H, Grinnell,
  • 34332, ros, Ovintiv, Kestrel 154-96-33-28-2H, Grinnell, 
  • 34331, conf, Ovintiv, Kestrel 154-96-33-28-11H, Grinnell,

Two other wells on/near the Kestrel pad:

  • 34330, 3,184, Ovintiv, Sorenson Federal 153-96-4-9-2H, Sand Creek, t4/18; cum 517K 1/21; 
  • 34329, 2,203, Ovintiv, Sorenson Federal 153-96-4-9-1H, Sand Creek, t4/18; cum 357K 1/21; intermittent production in 2020; off line 1/21;

Initial production:

34330:

BAKKEN9-201830223912238260594204325239030
BAKKEN8-20183127669278817528596222927027301
BAKKEN7-201831406974102810165946845734933752
BAKKEN6-20182928298281047433592623245924349
BAKKEN5-2018315443554538171531173494027176803
BAKKEN4-20183922284704218191601019123
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XTO Homer / Homer Federal Wells

XTO brings a Homer well back on line after eight months; production jumps 10-fold.

The well:

  • 29762, 959, XTO, Homer 14X-32A, Grinnell, t1/16; cum 4K 6 days production; cum 230K 1/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-20213150524370530321784215970
BAKKEN12-202032061183744574460
BAKKEN11-20200000000
BAKKEN10-20200000000
BAKKEN9-20200000000
BAKKEN8-20200000000
BAKKEN7-20201000220
BAKKEN6-20200000000
BAKKEN5-2020001520000
BAKKEN4-2020307107771534379237780
BAKKEN3-2020285865061070318931570

The other XTO Homer wells in Grinnell oil field:

  • 29761, 1,012, XTO, Homer 14X-32E, Grinnell, t1/16; cum 144K 1/21;
  • 31044, 797, XTO, Homer 14X-32AXD, Grinnell, t1/16; cum 306K 1/21;
  • 31045, 955, XTO, Homer Federal  14X-32F, Grinnell, t1/16; cum 167K 1/21;
  • 31046, 1,018, XTO, Homer Federal 14X-32B, Grinnell, t2/16; cum 306K 1/21;
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Several QEP Jones Wells Go Over 500K Bbls Crude Oil Cumulative; The Halo Effect -- March 4, 2021

This page will not be updated.

The QEP Jones wells in Grail oil field are tracked here. 

These QEP Jones wells have gone over 500K bbls crude oil cumulative.

  • 29324, 1,963, QEP, Jones 3-15-23TH, Grail, t9/15; cum 498K 1/21; only 8 days in 12/15; 
  • 29328, 2,312, QEP, Jones 4-15-22BH, Grail, t9/15; cum 514K 1/21; only 8 days in 12/15; 
  • 29329, 2,291, QEP, Jones 15-22 16-21LL, Grail, t9/15; cum 56K 1/21; only 8 days in 12/15;

The "original" Jones well:

  • 20591, 2,656, QEP, Jones 4-15/22H, Blue Buttes (sic; actually in the Helis Grail), t4/12; cum 662K 1/20:

Current production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-20213123592368168697389030151
BAKKEN12-2020312358215418368380793992
BAKKEN11-202030188319081671586556980
BAKKEN10-2020312076200916664927474632
BAKKEN9-20203016101565100325672348190

Huge jump in production (disproving Hubbert's theory):

BAKKEN1-2016261881019033114762639026127263
BAKKEN12-2015751034894530562065817389
BAKKEN11-20153023383234251674331862296172245
BAKKEN10-201531288672868229793328381896713760
BAKKEN9-201544854751011039601432
BAKKEN8-201552542540000
BAKKEN7-20153157555942657804607898
BAKKEN6-20153055515324637774107578

Initial production:

BAKKEN9-20123014358145351559963371232510
BAKKEN8-2012311755917422192019078180081070
BAKKEN7-2012241553615670205416970145802390
BAKKEN6-2012292311123281232426042229923050
BAKKEN5-201231291242901748323578935350439
BAKKEN4-201229441514470112655534853898714498
BAKKEN3-20122351125113241375722491508
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Two Wells Coming Off The Confidential List -- March 4, 2021

Bloodbath: twitter reporting bloodbath among EVs today; TSLA plummets another 3%; now trending  toward $630. GM down 5%. F down about 1%.

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.

Buffett grinning: CVX up another 2.35%; now trading over $106. Same with XOM; now trading over $58.

Asphalt terminalling:

Over at twitter: MLPs back in favor.

  • EPD: up about 1%;

General Dynamics: increases quarterly dividend by 8.2%; new, quarterly: $1.19/share

  • has raised its dividend for 24 consecutive years
  • annual: $4.76/share; 2.8%
  • 4Q20 EPS: $3.49; missed forecasts of $3.54; down slightly y/y
  • 4Q20 revenues: $10.5 billion vs $10.8 billion forecast; declined 2.7% y/y

GM extends NA auto production cuts: link here.

GM looking to build second battery factor in US: The WSJ.

  • joint venture with LG Chem
  • Tennessee eyed as a plant site

XOM: Exxon is in the oil and gas business; get over it.

  • will outperform the likes of BP
  • new price target: $84

Biden: good news for oil and gas; link here.

  • since Biden's victory, the big Oil & Gas ETF is crushing the big solar ETF
  • just like everyone predicted

************************************
Back to the Bakken

Active rigs:

$60.98
3/4/202103/04/202003/04/201903/04/201803/04/2017
Active Rigs1550685945

Operators for the fifteen rigs:

  • MRO (4): Kenyon; Mabel USA; Kulland USA; Flagg USA
  • CLR (3): Gordon Federal; Rodney 6, Rodney 11;
  • Hess (2): EN-Rice; EN-Joyce
  • WPX: Charles Blackhawk
  • Ovintiv: Kestrel
  • Oasis: Nikolai Federal
  • Whiting: Lacey
  • Slawson: Whirlcat Federal
  • Petro-Hunt, Hurinenko

Two wells coming off confidential list -- Thursday, March 4, 2021: 8 for the month, 64 for the quarter, 64 for the year.

  • 37308, drl/NC, WPX, Crosby Chase 2-1HC, Spotted Horn, first production, --; t--; cum --;
  • 36245, drl/NC, BR, Maverick 2D MBH, Dimmick Lake, first production, --; t--; cum --;

RBN Energy: refiners' crude slates, exports show Canada's self-sufficiency, part 4. 

Many countries like to talk about energy independence, but Canada is one of the few to come close to that elusive goal. For many years, Western Canada has produced more than enough crude oil to satisfy the demand of refineries in the region. More recently, a combination of rising Western Canadian oil production, and new and reworked pipelines, has enabled many of Canada’s eastern refineries to increase their intake of Western Canadian barrels. In the few remaining cases where they can’t, imported barrels from the U.S. have filled the gap, leaving crude imports from overseas accounting for just 1% of the market. Not surprisingly, Canada is also a net exporter of refined products, with refiners in Western Canada, and especially Atlantic Canada, producing far more than the country’s demand. Today, we conclude our series on Canada’s refining sector with a look at its growing reliance on Western Canadian crude oil and its ability to meet most of Canada’s need for gasoline and distillates.

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Boca Chica AKA Starbase -- For The Archives -- March 4, 2021

For the archives. Some day this may be noteworthy. Right now it's great cocktail trivia.

Boca Chica, TX: the city does not have a public water system. Water is transported by truck from nearby Brownsville and stored in tanks at each home. 

Boca Chica, TX; future home for Mars missions. First Mars, then the "stars."

Boca Chica, TX: Musk wants to re-name it Starbase, TX.

From Bloomberg via Yahoo!Finance:

Renaming Boca Chica would further deepen Musk’s imprint on Texas. 
In addition to SpaceX’s activity, his automaker, Tesla Inc., is building a massive factory in East Austin for its forthcoming electric pickup truck. 
The private Musk Foundation has moved to Austin from California, and Musk himself has said he has relocated Texas, though he still spends time in the Golden State. [Though less than six months annually, I suppose.]

SpaceX also tests rockets in McGregor, Texas, which is near Waco. The Starship prototypes it’s developing in Boca Chica are one day meant to fly people to the moon and to Mars.

Separately, SpaceX posted engineering positions at Starlink for “a new, state of the art manufacturing facility” it’s building in Austin. Starlink is the company’s space-based Internet service, which is available in parts of Canada, the U.S. and U.K. Austin television station KXAN reported earlier on the new job postings.

So, we have, in Texas, SpaceX:

  • Austin
  • McGregor
  • Boca Chica

From wiki:

In 2014, the village was chosen as the location for the construction of a control facility for the SpaceX South Texas launch site, while the launch site itself was slated to be built just 2 miles further east, adjacent to Boca Chica State Park on the Gulf Coast. 
In March 2021, Elon Musk announced plans to incorporate this village and surrounding land into a new polity to be called "Starbase", Texas.

 History:

Boca Chica Village, formerly Kennedy Shores, Kopernik Shores, is a small, unincorporated community in Cameron County, Texas, United States. 
It was formed in the late 1960s, and is still extant as of 2020, although the village proper has changed greatly since 2018 as industrial business enterprises came to occupy much of the land of the village. 
It lies 20 miles east of the City of Brownsville on the Boca Chica peninsula, and forms part of the Brownsville–Harlingen–Raymondville and the Matamoros–Brownsville metropolitan areas. 
It is situated on Texas State Highway 4, immediately south of the South Bay lagoon, and is located about 2 mi northwest of the mouth of the Rio Grande.
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Where Is All The Gasoline Going? Gasoline Draw Was Largest Since 1990-- March 4, 2021




Next week's EIA "gasoline demand" chart should be interesting.
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Notes From All Over, Early Morning Edition -- March 4, 2021

Texas Freeze Fallout:

  • ERCOT fires CEO
  • seven of ERCOT's fifteen directors have resigned in the last week
  • that's a start; now let's get back to building more wind farms 

Worse timing ever: just weeks after worst "wind fail" ever, EIA touts wind as a success story.



They must be reading the blog: exactly what I said yesterday.

  • China was the only major economy to record growth in CO2 emissions in 2020 -- IEA
  • due to return to industrial activity pickup after Covid-19 lockdowns
  • link here at ArgusMedia:
  • no mention of wind energy in China, but lots of coal plants

Weekly EIA report, re-visit:

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This Has To Be The Funniest Story I've "Read." Ever -- March 3, 2021

Without comment: link here.


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