Friday, April 16, 2021

Week 15: April 11, 2021 -- April 17, 2021

Top story of the week:

  • Joe Biden is still president

Top international non-energy story:

Top international energy story:

Top national non-energy story:

Top national energy story:

Top North Dakota non-energy story:

Top North Dakota energy story:

Geoff Simon's top North Dakota energy stories:






Other formations:

Bakken economy:


USAF's F-15 Eagle Recently Set Record For World's Longest Missile Shot -- Sources -- April 16, 2021

Decades ago I was assigned to the F-15D as my primary aircraft when flying with the USAF in Germany. It was the first time I heard the phrases, "Fox one," "Fox two," "Fox three," and "Fox four."

See wiki

The definitions of the four phrases may have changed a bit over the years or perhaps the USAF pilots I trained with simply used their own version.

For us, back in the 1980s and 1990s:

  • Fox one: the USAF fighter aircraft launched / fired a medium-to-long-range missile (AIM-7 Sparrow).
  • Fox two: the USAF fighter aircraft launched / fired a short-to-medium-range missile (AIM-9 Sidewinder).
  • Fox three: the USAF fighter engaged the gun. Obviously this was used only in a "dog fight." If an F-15 ended up in such close range requiring the use of a gun, the pilot had obviously erred be getting too close to the enemy aircraft in the first place. Using a gun was not good form.
  • Fox four: when all else failed, and perhaps having run out of ammunition, the pilot had one last option -- an intentional mid-air collision with the enemy aircraft. That was a "Fox four," greatly frowned upon, and to the best of my knowledge has never been used in modern warfare by the USAF. At least not reported. 

Apparently now, according to wiki:

  • Fox one: semi-active radar guided, AIM-7 Sparrow;
  • Fox two: infrared-guided, AIM-9 Sidewinder:
  • Fox three: active radar-guided, AIM-120 AMRAAM and AIM-54 Phoenix; the former a replacement for the AIM-7 (one can start to see the ambiguity in terms)

That was all preface to the following. According to The Drive and Popular Mechanics, the F-15 Eagle recently scored the "longest known" air-to-air missile shot during a US Air Force test. 

The first link, the link to The Drive, I think had the better story. The actual distance that qualified for a new record is, of course, classified, but it sounds like it was around one hundred miles. 

The F-15 radar has a range of around 100 miles, according to unclassified sources. 

I've long forgotten much of this, so as usual, there may be content errors in the note above. Plenty of open source material available.

Covid-19 Vaccine Accumulating Unused -- April 16, 2021

In a long note like this there will be typographical and content errors. In addition, it was done quickly while being distracted by a number of other things (like Sophia, and the grandsons in Portland, OR, via Facetime). So take this post with a grain of salt. I would recommend going to the sources but this is for my benefit for the archives. Weird stuff going on in Brazil.

Unused Vaccine Piling Up In Some States

If will be interesting to see if there are any changes in these graphs after the CDC "paused" the JNJ vaccine due to "safety concerns." Serious side effects have been reported in one person in every 6.8 million given the JNJ vaccine. This accumulation is in addition to 10% wastage from 10-cc vials, as well as vaccine thrown out at the end of day because folks scheduled for their vaccination did not show up as scheduled.

On another note, it's likely that a sizable number of Americans are unable to identify the various companies that are providing vaccine for Americans. All they have heard is that "the Covid vaccine is unsafe."

For The Archives

Yesterday it was India. Today it is Brazil. And Italy still has its problems. To some extent, one almost has to ask, at the global level, are "we" any better off than we were a year ago?

But, back to Brazil. 

It's now being called a humanitarian catastrophe in Brazil. I assume the Japanese are watching closely. 

Apparently something new is being reported in Brazil: many of the new deaths are "young people" and according to the New York Daily News, Covid has killed an alarming number of babies in Brazil." 

The new study, reported Thursday by the BBC, found that as many as 2,060 children under 9 years old may have died from coronavirus since February 2020, including 1,302 babies.

The government is advising women not to become pregnant.

Whatever happened to the Zika virus?

The numbers, link here. The numbers in Brazil are so extraordinary, two questions come up immediately:
status of vaccination program:

As of two days ago, raw numbers, 

  • new deaths:
    • Brazil, #1 in the world: 3,462 new cases
    • India, #2 in the world: 1,037 cases
  • population:
    • at 1.4 million, India has 6.5x the population of Brazil
  • new deaths:
    • Brazil had more than 3x the number of new deaths reported than India;
  • new cases:
    • India: 0.014% of the population
    • Brazil: 0.03555% of the population
  • new cases corrected for population:
    • Brazil is reporting 2.5x as many new cases per capita than India
  • new deaths :
    • Brazil: 0.00161965% of the population
    • India: 0.000074568% of the population
  • new deaths corrected for population
    • Brazil is reporting 22x as many new deaths per capita than India

No New Permits; XTO Renews Four New Permits; Active Rig Count At 17; WTI Holds Above $63 -- April 16, 2021

Active rigs:

Active Rigs1733655951

No new permits.

Four permits renewed:

  • XTO: four Bully Federal permits in McKenzie County.

The "Seasonal Flu" Epidemic The CDC Reported One Year Ago Quietly Went Away -- The Covid-19 Virus Absolutely Destroyed H1N1 And All Its Variants -- Unprecedented -- April 16, 2021

Our grandchildren will never see "seasonal flu" again. 

Re-posting. I put this in draft and then forgot about it. A reader reminded me:

I quit following "seasonal flu" statistics this year many months ago but after seeing the "cartoon graphic" earlier today, I had to fact-check the data myself. 

This is from the CDC

This is week 40 of this year's "seasonal flu" season which began September 27, 2020, and will continue through week 52, but the "seasonal flu" season is over for all intents and purposes for this year, 2020 - 2021. 

This is truly bizarre. There is no other word to describe it 

This year, so far, into week 40, cumulative data from September 27, 2020:

  • number of people tested for "seasonal flu': 860,095
  • number of people that tested positive: 1,710 (0.2%)

Let's repeat that.

Technically it's the number of specimens tested. Some people were tested more than once obviously,

  • but the total number of specimens tested: 860,095
  • the total number of specimens that tested positive for "seasonal flu": 1,710 (0.2%).

As a reader noted: it's clear that masks and social distancing is all we need to combat "seasonal flu." 

That annual "flu shot"? So yesterday. Can't ever imagine having to get it again. [Note: I haven't had a "flu shot" since I retired from the military in 2007. I'm just doing my part to save some money for Medicare and Tricare.]

I'm not being facetious: if the reader is correct, that all we need to do is wear masks and stay six feet apart to pretty much eliminate the "flu," why bother with a shot. With Covid-19, even after being vaccinated, the CDC recommends continued masking and social distancing. 

But does anyone really believe that only 1,710 Americans "caught" the "flu" this past year? LOL.That's what the CDC is telling us. Last year? At least 18 million outpatient medical visits.

Here's the final 2019 - 2020 data, on year earlier, link here:

  • one of the worst years ever (see graphic at the linked article);
  • hospitalization rate was 69 cases per 100,000 people
    • cases: at least 18 million medical visits;
    • hospitalizations: at least 410,000
    • compare that with 1,710 specimens that tested positive this year, 2020 - 2021
  • worst flu season for children in a decade;
    • 170 pediatric deaths associated with the "flu"

The graphics:

To paraphrase a character in an old Columbo episode: "Where DID all those flu cases go?"

No one has the answers. I don't have the answers, but when no one is even asking what happened to "seasonal flu" that pretty much tells me all I need to know. 

Seasonal Flu

What makes the above posting so interesting is this. Exactly one or two weeks before the lockdowns and the beginning of the " Covid-19" pandemic, the US was reporting a "seasonal flu epidemic."

From March 28, 2020:

From the March 19, 2020, blog, this screenshot:

Well, well, well .... from the CDC's weekly SEAFLU update just released:

This may be the "second wave" that is common in epidemics. 

This is truly remarkable:
  • this should be the beginning of the end of the "seasonal flu" season, and here we have "seasonal flu" now above the epidemic threshold
  • this was not mentioned during the weekly coronavirus task force update, yesterday (March 27, 2020) update
  • reporters have apparently not noticed this
  • the number of cases per 100,000 actually increased -- again, when the "seasonal flu" season should becoming to an end
    • threshold: 59/100,000 -- above that number it gets my attention
    • previous week, it was 61.6/100,000
    • most recent week: 67.3 / 100,000 -- a nearly 10% increase week over week
  • 222,090 new cases of "seasonal flu" last week -- not being reported by the mainstream press
  • in addition, with social distancing for coronavirus, one would that would help lessen the spread of "seasonal flu"
  • the CDC tells us that "season flu" peaks between December and February, but can last as long as May
  • unlike coronavirus, so far, "seasonal flu" is particularly dangerous to those under four years of age -- see below
  • and ... we have a vaccine for "seasonal flu" -- albeit less than 45% effective
Now, from the CDC, how bad is "seasonal flu" this. Again, from the linked CDC report (most recent week):

Because the CDC put black text on blue background it's hard to read. Here is what the CDC said regarding this year's SEAFLU:
  • worse than most recent seasons
  • rates for children 0 - 4 and adults 18 - 49 are the highest CDC has on record for these age groups;
    • these rates surpass the rates during the 2009 H1N1 pandemic
    • hospitalization rates for school-aged children (5 - 17 years of age) are higher than any recent regular season but remain lower than rats during the 2009 pandemic
    • death rates for children is higher than recorded at the same time in every season since reporting began in 2004 - 05 except for the 2009 pandemic
  • total US flu cases this season: CDC cannot give accurate number -- can only estimate: 
    • nearly 40 million cases
    • 400,000 hospitalizations
    • 24,000 deaths
I find this absolutely incredible. From a medical/scientific point of view, I find it clinically and unemotionally fascinating. In the midst of a coronavirus pandemic which has folks absolutely terrified, this is also one of the worse "seasonal flu" seasons the US has ever had -- and by the time it's over, it may be the worst. If so, few will hear about it because of all the attention Wuhan flu is getting.

My hunch: this post will be picked up by some reporter, and it [the "seasonal flu epidemic] will make the news in a week or so if things get worse ... and, of course, the reporter who picks up on the story will not credit the source. LOL. Just saying. If this is simply a one-time blip, this story will simply die -- "seasonal flu" simply does not have the cachet of COVID-19.

Note: the CDC does not say this explicitly but if one thinks about this, one can go back, read between the lines in the CDC report and consider that's this year's "seasonal flu" numbers are somewhat of a fluke in that "everyone" feeling even the least bit ill is so concerned about coronavirus, they are seeking medical attention and being tested.

In other words, had we not had "coronavirus," we would be in the same situation, but it would been called the 2020 Trump flu epidemic. In many ways, the president was fortunate that the source of his year's coronavirus story came from China, and that he presciently acted early on to ban international flights from China (unlike the Cuomo brothers' stance -- see below). 

In past years, many folks would have simply stayed home, self-medicated with rest, fluids, Tylenol, and "self-quarantining" and never even been seen by health professionals.

By the way, one month ago, ContagionLive suggested the "seasonal flu" season was coming to an end -- again, this was a month ago:

Coronavirus update: the three hot spots in the US right now:
  • Washington State: rates are coming down
  • Louisiana: out of control -- traced back to Mardi Gras 
  • NYC: out of control -- traced back to the mayor and the governor both saying, at the onset of this outbreak, back in February, NYC will remain open to all travelers; welcome visitors; will not shut down:
By January 31, the day President Trump suspended flights from China, “outbreaks were already growing in over 30 cities across 26 countries, most seeded by travelers from Wuhan,” according to one model by the New York Times.
But even by late February, Cuomo boasted about his state’s accessibility to foreign travelers—his state, the governor said on February 26, is the “front door” for visitors from around the world—while only instituting voluntary quarantines for suspected coronavirus carriers.
“Our operating paradigm has always been, prepare for the worst but hope for the best,” Cuomo said.
By the way, NYC is on a trajectory to exceed all of China in number of cases. 

And there we have it. Washington State is winding down, where early on the coronavirus outbreak was pretty much due to one "super-spreader."

One wonders how much "better" the US numbers would have looked if New Orleans would have canceled its Mardi Gras celebrations, and had the Cuomo brothers in New York taken this seriously from the beginning.

Big, big fear: geographical proximity of Louisiana to Houston; the huge inter-mixing of oil workers between the two states (Louisiana and Texas) and the historically close relationship between New Orleans and Houston (Hurricane Katrina diaspora).

Status Of The DAPL Today -- April 16, 2021

This is a pdf download. I can't post the link, but simply go to google and search for Haynes and Boone oil bankruptcies

The DAPL: Where We Stand Today

Where we stand today:

Friday, April 9, 2021, day 0:

  • US Army Corps of Engineers won't shut it down; will let judge decide
  • Judge: thumbs down; kill it;

Saturday, April 10, 2021, day 1:

  • Judge: thumbs up; let it flow;

Sunday, April 11, 2021, day 2:

  • Judge: thumbs down; kill it;

Monday, April 12, 2021, day 3:

  • Judge: thumbs up; let it flow;

Tuesday, April 13, 2021, day 4:

  • Judge: thumbs down; kill it;

Wednesday, April 14, 2021, day 5:

  • Judge: thumbs up; let it flow;

Thursday, April 15, 2021, day 6:

  • Judge: thumbs down; kill it;

Friday, April 16, 2021, day 7:

  • Judge: thumbs up; let it flow;
Saturday, April 17, 2021, day 8:

On Dividends -- April 16, 2021

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

I'm running out of time this morning so I will come back to these two stories later. 

First, dividend stocks are out of favor, but here are nineteen that Wall Street loves, including CVX and WMB. Link to MarketWatch.

Williams Cos. Inc. and Chevron Corp. provide some insight into what has gone on in energy during the COVID-19 pandemic. 
Williams is an oil refiner and pipeline operator, while Chevron is an integrated oil company. It was not surprising to see both drop as fuel demand cratered during the pandemic’s most painful period for financial markets. 
But 20/20 hindsight makes the stocks’ declines appear to be overreactions. Williams came roaring back, producing a return of only -8% in 2020. The stock is up 20% so far in 2021. 
Chevron was down 26% in 2020 and has returned 24% so far in 2021. Analysts see plenty of price upside for both companies — and that excludes the dividends. 

Second, a reminder: a dividend aristocrat on sale -- AbbVie. Think Humira.

Heart drug Lipitor is the biggest-selling drug of all time. Perhaps no surprise to dedicated pharma-watchers, who know the statin med still racks up blockbuster-level sales despite years of generic competition.

It won't hold that crown for much longer, though. AbbVie's Humira is set to steal it away—and remain history's biggest-selling drug at least through 2024. Lifetime total by then? A whopping $240 billion. [AbbVie's Humira goes off-patent in 2023, and every Tom, Dick, and Harry will start to manufacture it.]

That fact may not be all that surprising, either. But as generics continue to bite and biosimilars begin to rear their heads, the current set of all-stars is in for a shuffle over the next five years, according to estimates tallied by Evaluate Pharma.In both cases, the articles bring up points that have nothing to do with investing or dividends. They are simply interesting stories for other reason.

I will have to go back and look, I've long forgotten but I put Lipitor in "old" biotechnology; Humira in "new" biotechnology. 

The Covid-19 vaccine research will morph into "Star Trek" biotechnology. It was research into an Ebola virus vaccine that led to the success of the Covid-19 vaccine. Interestingly enough, an Ebola virus vaccine was never marketed; that research was done under pre-Trumpian thinking.

[Ronald Reagan brought us a "Star Wars" military-industrial complex. Donald Trump brought us "Star Trek" biotechnology.]

We are now back to pre-Trumpian thinking with the new administration but there is one difference. The "horse has left the barn" as they say. 

By the way, that was the same thing that happened with regard to fracking, which we discussed years ago. Wow, the synapses are firing today. Chaos.

Masks Vs Deaths -- Another Look -- April 16, 2021

Graphic of the day, sent to me by a reader early this morning.

The reader noted that moments after sending me this graphic it was announced that the governor of New Hampshire (whose name I cannot spell due to too many "u's" and "n's") has just ended the mask mandate for state, immediately.

By the way, with regard to the graphic above, there's another point being made that may not be immediately obvious.

And until 2025, this graphic cannot be posted too many times:

Bakken Production -- February, 2021 -- The Director's Cut -- A Closer Look -- April 16, 2021

Take another look at the February data at the Director's Cut that was posted yesterday. 

First, this:

Crude oil production:

  • February, 2021: 1,083,020 bopd (prliminary)
  • January, 2021: 1,147,374 (preliminary); 1,147,377 (final)
  • December: 1,192,145 (preliminary); 1,191,429 bopd (final)
  • November: 1,224,540 (preliminary); 1,227,138 bopd (final)
  • October: 1,222,871 bopd (preliminary); 1,231,048 bopd (final)
  • delta:  -64,357 bopd (this is interesting
  • delta:  -5.6%

Now, this:

Number of producing wells:

  • February, 2021: 15,773 (preliminary)
  • January, 2021: 15,861 (revised)
  • December, 2020: 15,798 (preliminary -- I forgot to update it)
  • November, 2020: 15,601 (preliminary -- I forgot to update it)
  • October, 2020: 15,512 (preliminary); 15,524 (final)

In addition to whatever observations / thoughts you have with regard to the data above, be sure to ask this one question:

  • with WTI at recent highs, and with more than adequate takeaway capacity (DAPL is not yet shut down) why did operators take so many producing wells off line (no, this is not likely the result of weather, although I could be wrong on that)?
  • number of producing wells dropped by 5.6%

From the NDIC, historical monthly oil production statistics:

  • First column: Year
  • Second column: Month
  • Third column: BBLS oil, total for the month
  • Fourth column: daily oil, bbls
  • Fifth column: number of wells that were actively producing (includes all ND wells, not just Bakken wells)
  • Sixth column: bbls of oil per producing well, average, for the entire month
  • Seventh (last column): bbls of oil per producing well, on average, on a daily basis;

With regard to DUCs, no analysis is possible until we get to summer.

A Reader Responds -- April 16, 2021

Yesterday I played "devil's advocate" with regard to The Financial Times story on US shale operators dying on the vine.

A reader responded. I will respond to the reader's response below -- to suggest what this means for those who are curious how I see the reader's very insightful, very prescient comments. 

The following was edited slightly for formatting. If there are typographical and/or content errors, they are mine, not the readers, which occurred during my editing:

I had finished poring over the just-released Pennsylvania production numbers for February (most recent) before turning to your blog.

To "cut to the chase," several smaller "No-Name" companies - all privately owned - continue to post exceptionally strong numbers  from their smallish land holdings. [Connect this line to the concluding statement by the reader.]

My "in-a-nutshell" appraisal ...
Yes, many moneyed people/institutions are about at the end of their rope looking at these monthly figures while simultaneously seeing no financial returns coming their way. 
Yes, it would not surprise me that many private companies have been drilling/producing at a fast pace these past 2 years in order to show the Big Boys just how good their potential is.
However ... for those of us looking at the Bigger Picture, this might be what to expect in the coming years:
  • higher pricing for raw hydrocarbons. ~$70 WTI and ~$3/$3.25 Henry Hub (HH) might be a reasonable assumption.
    • this assumption is completely meaningless in the Real World as both you and I know things change with blinding speed.
    • (the mere fact that ongoing attacks on Saudi infrastructure and a not-so-low-grade war taking place in the Middle have clearly shown no impact on global pricing is SO far removed from our historical experience as to make future prognostications groundless).
  • abundant hydrocarbon resources available for decades to come with remaining US producers doing very well.
  • fringier areas in the current basins will be developed by tenacious, risk taking Little Guys as the hardware, technology, and proven processes will be employed to 'wring out' every viable barrel, every cubic foot of hydrocarbons
  • if/when prices spike upwards (even temporarily) - say, in the ~$90/$100 bbld range - new plays will be exploited.
    • these include - but are not limited to - the Powder River Basin, the Tuscaloosa Marine Shale, the Uinta, the Rogersville, and more
    • artificial lift and re-frac'ing technologies will continue to improve so as to upend the standard, current production profiles of many of today's  wells
  • no one talks about EOR anymore, but there are over a half dozen projects taking place right now with publicised results expected in the next year or two.
  • a much higher recovery factor is practically guaranteed, but no operator wants to tout that even MORE oil will be coming to market.
I could go on, but I will stop right there with one recent comparison ... the frenzied boom related to the Dot Bomb phenomenon 20 years ago.
Bill Gates said, (2004/5 timeframe, IIRC), that, yes, an over-exuberant atmosphere drew in hundreds of billions of dollars that did not offer a positive financial return.
However, Gates continued, a new, paradigm-shattering framework was put into place whereby this new fangled Internet thingy would exert a profound influence across the globe.

This is what Harold, Mark Papa, Aubrey McClendon, et al have bequeathed to the world.
Wow, that's a great note. 

Notes And Comment -- Early Morning Note -- April 16, 2021

First things first: a huge apology to a reader for my delay in responding to his very insightful e-mail he sent me yesterday. I haven't forgotten. I will get to it today! I promise. That reader is perhaps the most insightful reader I have when it comes to the shale revolution; his experience is in natural gas in the northeast but sometimes I think he understands the Bakken better than I (do). He is certainly more exuberant about the science than even I am. And that's saying a lot.

So much going on today. I thought it was Saturday and was going to sleep in. That's why I'm behind in blogging this morning. 

So much to cover:

  • the buzz today: the EV companies, with regard to the market, are doing very, very poorly; "a stunning fall from grace." They must be reading the blog -- I just posted a note on EVs yesterday that "explained" this
  • masks and deaths per capita: a reader sent me a  most interesting chart. I will post it later; as soon as he saw the graph, the governor of New Hampshire removed the state's mask mandate -- at least that's what the reader who sent me the graphic suggested;
  • ten-year treasury: not trading as "experts" expected
  • US markets: on the way to more records; YOLO has morphed to FOMO;
  • a BofA "talking head" suggested the US GDP is running at 10% and that rate of growth will continue for quite some time, although maybe not quite that high, and there will be "ankle-biters" that will pull the GDP down. By the way, the huge deficit / debt (whatever) will cut the GDP as much as 0.8%. Really? Really. 
  • Dow and S&P hit another record today. I can't keep up.
  • COMCAST: share price target raised. Whoo-hoo! 
  • re-iterating: I see no comparison between 1920s and 2020s; the 2021 - 2026 looks a lot more like 1949 - 1965; and, yes, the time-span "discrepancy" is incredibly important to note. Link here.

Back to the Bakken

Director's Cut: production numbers for February -- overnight I just noticed something that no one has yet talked about; see post here.

Slawson is back! What it means for the Bakken. Maybe later. 

Active rigs:

Active Rigs1733655951

Two wells coming off the confidential list -- Friday, April 16, 2021: 13 for the month, 13 for the quarter, 94 for the year:

  • 37795, drl/NC, CLR, Carson Peak 14-35HSL1, Corral Creek, no production data,
  • 37230, drl/NC, WPX, Patricia Kelly 2-1HS, Spotted Horn, no production data,

RBN Energy: reducing intentional releases of natural gas spurred by ESG objectives, regulations. Methane bad, natural gas good.

Methane, the primary component of natural gas, is the second-most-abundant greenhouse gas tied to human activity after carbon dioxide, and pound-for-pound has 25 times the heat-trapping potential of CO2. We also know that a considerable portion of methane emissions come from the oil and gas industry, not just from leaks but from intentional releases such as “blowdowns,” when operators vent natural gas into the atmosphere to relieve pressure in the pipe and allow maintenance, testing, and other work to take place. 
Sure, it would be better for the environment and most everybody involved if there was a way to capture natural gas instead of releasing it. (Spoiler alert: there is.) But what are the incentives for producers, pipeline owners, or local distribution companies invest in a solution? Today, we consider what midstreamers, transmission operators, and LDCs can do to minimize blowdowns.