Notes From All Over -- May 17, 2021

Again, I have to apologize. I haven't been able to post everything I wanted to post because of family commitments: high school and college graduations; out-of-town visitors; etc. 

In fact, so much is happening so fast, I don't know if I will ever get caught up with the news, much less the commentary.

I have received a lot of e-mail today and have yet to answer most of it. I apologize. Just too much "stuff" to do. 

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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The Phrase That Will Define 2021 - 2022: Free Cash Flow

Investors: the tea leaves suggest the oil companies are going to have some blow-out quarters for the next year or so. 

I don't have time to find / post all the headlines / stories, but this looks quite interesting.

Remember, "everyone" agrees that "all" US shale companies have a breakeven at "no more" than $50 / bbl, WTI. Anything above $50-WTI is free cash flow. And unlike most sectors, the E&P companies tend to increase dividends in direct proportion to their EPS. 

WTI trading at $66.56.  

Let's see: $66.56 - $50 = $16.56 / bbl.

Exhibit A: EOG has already declared a $1.00 / share special dividend. 

Exhibit B: fifty percent more active rigs in the Bakken today than one year ago. 

There are now eighteen operators with at least one active rig in the Bakken. 

Headline over at oilprice.com tonight: natural gas prices jump on warmer weather. 

ArgusMedia: Asian premium beckons as US LNG outgrows Panama.

Higher premiums for spot LNG delivered to Asia could become more common, with growing US liquefaction having already far outstripped the capacity of the Panama Canal.

The canal is the quickest and lowest-cost route to northeast Asia for exports from the world’s largest spot supplier.

With growing Asian demand on course to exceed available supply within the region, buyers are likely to become increasingly reliant on long-range deliveries. And the need to deliver along longer routes means Asian buyers are poised to pay higher premiums for the marginal Atlantic cargo to cover additional freight costs.

The US is already capable of loading around 90 cargoes a month, following the commissioning of a third 5mn t/yr liquefaction train at Corpus Christi. This could rise to just over 100 cargoes a month by this time next year, when another 10mn t/yr of export capacity should have been added.

But there is a limit on how many of these cargoes can take the most direct route to northeast Asia, because the Panama Canal offers only two bookable slots — one in each direction, or two northbound that are typically for empty carriers returning to the US.

This leaves the equivalent of a maximum of one bookable southbound slot for every three cargoes likely to be loaded in the US in any given month.

And the booking window for these slots favours northeast Asian buyers that intend to use their US LNG offtake as base-load gas supply, because the window opens 80 days ahead of the intended transit date — a touch too early for firms looking to sell US cargoes on the spot market.

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Miscellaneous

ATT: wow, what a disaster. 

ZeroHedge: suspended (again) from twitter. 

Could US shale learn from US lumber?

Ten Permits Renewed; Five New Permits; Two Producing Wells (DUCs) Reported -- May 17, 2021

Active rigs:

$66.29	5/17/2021	05/17/2020	05/17/2019	05/17/2018	05/17/2017
Active Rigs	19	13	66	60	52

Five new permits, #38311 - #38315, inclusive:

• Operator: MRO
• Field: Bailey (Dunn County)
  
• Comments:
• MRO has permits for five Bailey field wells to be sited in NWNW section 25-146-94
• all sited 1050' FWL and from 625' FNL to 465' FNL
  

Ten permits renewed:

• XTO (3): three Jorgenson Federal permits in Dunn County;
• Iron Oil Operating (3): three Antelope permits in McKenzie County;
• Whiting (2): one Kaden TTT permit in Mountrail County, and one Kessel permit in Stark County;
• Crescent Point: one CPEUSC Claire Rose permit in Williams County;
• BR: one Catalina permit in Dunn County;
  

Two producing wells (DUCs) reported as completed:

• CLR: two Simmental Federal wells in McKenzie County;
• 37046, drl/A, Simmental Federal 11-16H2, Elm Tree, first production, t--; cum --; total drilling days, 11; second bench, Three Forks; target: land the wellbore 66' below the Three Forks formation top, but more specifically 12' into the Three Forks 2nd bench; the wellbore stayed within the ideal 12' target window 93.4% of the production lateral length; fracked 1/6/21 - 1/16/21; 6.0 million gallons water; 87.6% water by mass;
  
• 37047, drl/A, Simmental Federal 10-16H, Elm Tree, 33-053-09224, first production, t--; cum --; fracked 1/5/21 - 1/15/21; 7.1 million gallons water. 86.2% water by mass;
  

Locations resurveyed:

• seven FB Leviathan permits, Bruin E&P Operating; NENE 27-151-94, McKenzie County

Finally: The April, 2021, Data -- Atmospheric CO2

Link here. 

April, 2021: 419.05. 

Up 0.69% year-over-year despite pandemic lockdown. So US/global economy plummets, and atmospheric CO2 actually increases, and increases at a fast rate than the year before. Okay. So, the UN is correct: "we" have to pretty much shut down western civilization to save the world. Even though it's probably China's coal plants that are mostly responsible if this "atmospheric CO2" even correlates with "manmade contribution."

April, 2020, one year ago: 416.18. Up 0.64% year-over-year.

April, 2019: 413.52. 

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Meanwhile, This Won't Help

Brazil will incentivize additional natural gas imports as drought saps hydropower output. ArgusMedia. Petrobras ramps up gas imports amid drought. 

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CDC Covid Vaccine Data

There seems to have been a data reporting problem either yesterday or today.

CDC data is here.

		Doses of vaccine distributed to health facilities	Change from day before	Vaccinations given	Change from day before	Percent of distributed vaccine that is actually administered	Doses received in past week, current Monday from previous Tuesday	Average number of doses given / day in past seven days
Monday	May 17, 2021	344,503,495	0	272,925,411	-619,796	79.22%	14,659,670	1,618,004
Sunday	May 16, 2021	344,503,495	100	273,545,207	2,712,865	79.40%
Saturday	May 15, 2021	344,503,395	2,637,450	270,832,342	2,393,676	78.62%
Friday	May 14, 2021	341,865,945	2,700,500	268,438,666	1,842,180	78.52%
Thursday	May 13, 2021	339,165,445	2,075,680	266,596,486	1,915,642	78.60%
Wednesday	May 12, 2021	337,089,765	3,008,700	264,680,844	1,548,283	78.52%
Tuesday	May 11, 2021	334,081,065	4,237,240	263,132,561	1,533,180	78.76%
Monday	May 10, 2021	329,843,825	0	261,599,381	1,882,392	79.31%	17,334,250	2,117,025
Sunday	May 9, 2021	329,843,825	3,770	259,716,989	2,369,784	78.74%
Saturday	May 8, 2021	329,840,055	2,715,430	257,347,205	2,567,872	78.02%
Friday	May 7, 2021	327,124,625	2,514,440	254,779,333	2,805,581	77.88%
Thursday	May 6, 2021	324,610,185	3,060,850	251,973,752	2,406,932	77.62%
Wednesday	May 5, 2021	321,549,335	3,075,300	249,566,820	1,797,771	77.61%
Tuesday	May 4, 2021	318,474,035	5,964,460	247,769,049	988,846	77.80%
Monday	May 3, 2021	312,509,575	0	246,780,203	1,188,734	78.97%	21,817,570	2,287,393

WTI Continues To Melt Up; Twelve Operators With Active Rigs In The Bakken; Nineteen Active Rigs -- May 17, 2021

Tesla: TSLA is now trading below $575. Down 4% today; trading about $565. 

ATT - Discovery: lots of media analysis. ATT moving from "vertical integration" to "pure-play" streaming services. 

Wow -- so many story lines: Saudi sovereign fund PIF boosts US equities exposure to over $15 billion. Reuters.

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Back to the Bakken

Boom: the number of active rigs in North Dakota are now almost 50% higher than a year ago -- 19 vs 13. 

Active rigs:

$66.29	5/17/2021	05/17/2020	05/17/2019	05/17/2018	05/17/2017
Active Rigs	19	13	66	60	52

The operators with active rigs:

• CLR (5): Gordon Federal, Bang, Harrisburg, Harms Federal, Candee
• Hess (2): EN-Johnson, GO-Braaten,
• MRO (2): Armstrong, Morgan USA,
• Ovintiv (2): Rolla, Rolfsrud
• Slawson: Mauser Federal,
• Rimrock: FBIR Guyblackhawk,
• Enerplus: Beaver,
• Iron Oil Operating: Antelope,
• Petro-Hunt: Jorgenson,
• Whiting: Lacey
• Oasis: Cliff Federal,
• Crescent Point Energy: CPEUSC Sylven,

One well coming off confidential list -- Monday, May 17, 2021: 28 for the month, 49 for the quarter, 130 for the year:

• 36600, 1,400, Hess, EN-Anderson-LE-156-94-1820H-11, Manitou, t11/20; cum 67K 3/21;

Sunday, May 16, 2021: 27 for the month, 48 for the quarter, 129 for the year:

• None.

Saturday, May 15, 2021: 27 for the month, 48 for the quarter, 129 for the year:

• None. 

RBN Energy: MVP delay risks amplifying Appalachia's re-emerging gas takeaway constraints. Archived.

Appalachia natural gas producers hoping to get a big boost in pipeline takeaway capacity later this year were dealt some bad news recently. On May 4, Equitrans Midstream officially pushed back the in-service date for the already-delayed Mountain Valley Pipeline. The 2-Bcf/d, greenfield project is the last of the major planned expansions that would add substantial capacity from the prolific Appalachia gas-producing region and help stave off severe seasonal pipeline constraints, at least in the near- to midterm. Previous guidance had it coming online late this year, but Equitrans said it is now targeting start-up in the summer of 2022, pending water and wetland crossing permit reviews. The news is far from surprising considering the numerous regulatory and legal challenges midstream projects, including MVP, have previously faced in the Northeast over the past decade or so. But the resulting uncertainty leaves Northeast producers in a tight spot. In today’s blog, we will consider the implications of the MVP delay for Appalachia’s outflows.