For The Archives -- The California Heat Wave -- June 29, 2021

 Link here.

• Spot gas prices in Southern California surged 8% today to $7.08/MMBtu as the region turned to gas-fired generation to cope with the ongoing heatwave while power imports dropped.
• Relevant tickers include SRE, EIX, PCG
• California ISO's thermal power demand has spiked in the days since the start of the West Coast heat wave, with generation ramping up 58% to 331 GWh on June 28 from 210 GWh on June 26, 2021.
• Yet even as total power demand rose, power imports into the state fell 36% to 85 GWh on June 28 from 133 GWh on June 26.
• The National Weather Service forecasts the upper-level high-pressure system responsible for the heat wave could weaken by July 1.

What would the "power imports" be? Wind energy? Coal?

From the EIA:

In 2019, California was the nation's largest net importer of electricity from out of state and received about 28% of its electricity supply from generating facilities outside the state. 

More than seven-tenths of the power delivered to California from states in the Pacific Northwest was from renewable energy sources, including large federal hydroelectric facilities. 

The Southwest, including energy imports from Arizona, Baja California, Colorado, Mexico, Nevada, New Mexico, Texas, and Utah, delivered power generated from renewables, natural gas, nuclear energy, coal, or other, unspecified, resources. 

Slightly more than one-fourth of the southwestern power came from renewable sources. 

About 10% of California's total electricity imports are from coal-fired power plants, but coal's total contribution to the state's electricity supply from imports and in-state generation in 2019 was less than 3%. 

Electricity supplied from out-of-state coal-fired power plants decreased following the enactment of a state law in 2006 that requires California utilities to limit new long-term financial investments in baseload generation to power plants that meet California emissions performance standards. Essentially all of California's imports of coal-fired generation are projected to end by 2026.

Some Huge Gas Wells Being Reported In The Marcellus -- June 29, 2021

Updates

June 30, 2021: from a reader regarding the original post --

That 47 MMcfd IP from Chief may certainly be impressive, but - by Marcellus standards - it is not especially noteworthy in comparison to other Northeast Pennsylvania wells. 

Chesapeake must have at least 2 dozen wells that have flowed more than that the first 30 days online. 

Chesapeake's best well - quickly rocketing to #1 all time producing status, the Deremer 2HC - produced over 50 MMcfd its first 3 months online. (50 million cubic feet/day is 8,600 boed.)

Now online 19 months, it has produced almost 19 and 1/2 Billion cubic feet ... 3,360,000 barrels of oil. 

These crazy high numbers are what prompted me to re-focus my attention to the 'gas world' of hydrocarbons with emphasis on the Appalachian Basin. 

(Although Shaleprofile has changed its format, it used to provide running, cumulative production numbers for Pennsylvania wells. Last I checked, about 20% [~2,000] had surpassed the 5.8 bcf mark ... the equivalent of a million barrel oil well).

 Original Post

Link here.

Let's see: 47 million cubic feet / day = 7,800 boepd?

*************************************
Flathead Lake

For The Archives -- OPEC Hopes To Drive Price Of Oil Down -- Opinion -- June 29, 2021

Saudi Arabia did this once before. It was a trillion-dollar mistake. Back in 2014 - 2016.

Link here.

*************************************
Tooling Around Flathead Lake

Notes From All Over -- Late Afternoon Edition -- June 29, 2021

Facebook, re-posting this story. This time from The LA Times daily newsletter:

Facebook Inc. won a court ruling dismissing two monopoly lawsuits filed by the U.S. government and a coalition of states that sought to break up the company, dealing a blow to the effort of antitrust officials to take on the biggest tech platforms. 

The decision by U.S. District Judge James Boasberg in Washington sent Facebook shares soaring; it pushed the company’s market value to more than $1 trillion. 

Boasberg granted the company’s request to dismiss the complaints filed last year by the Federal Trade Commission and state attorneys general led by New York, saying in his opinion that the FTC failed to meet the burden for establishing that Facebook has a monopoly in social networking.

Walmart: to introduce a discount private label insulin brand at steep discounts for diabetes patients. Perhaps more on this later. Link at Yahoo!Finance. All I can say is where has the US government been on this one all these decades. Truly a sad, sad story.

Banks: wow, it seems like just yesterday that banks were in disfavor by all the talking heads. Hopefully, folks took advantage of that. LOL. Windfall of big bank dividends point to more shareholder return. Reported earlier: BAC announced that it will be increasing its quarterly dividend by 17%. 

Now this from Brian Cheung over at Yahoo!Finance:

The large banks are raining dividends on their shareholders after getting a clean bill of health from the Federal Reserve. And bank analysts say the windfall of capital returns is only just beginning.

Last Thursday, the Fed cleared all 23 large banks tested in its annual stress exercise, which examines each firm’s ability to withstand a hypothetical severe recession.

Facing a real recession last year, the Fed imposed restrictions on dividends and share buybacks at the large banks to preserve capital. But the stress test results last week convinced the Fed that it could lift those temporary restrictions.

As a result, several banks on Monday afternoon announced increases in their dividend plans.

Morgan Stanley and Wells Fargo both doubled their dividends (to $0.70 a share and $0.20 a share, respectively). The nation’s largest bank, JPMorgan Chase increased its dividend to $1.00 per share from $0.90 per share.

Dividends are pretty amazing. I pay a lot in income taxes on dividends, but it's very possible my cash flow from dividends before I die will be greater than the cash flow of all my other investments and other financial holdings. And that has been through very, very conservative investing which has not affected my lifestyle one bit. 

Same with "401(k)s": allowing folks to retire early. What a great country. My hunch: it is just a matter of time before Congress takes notice. This was another investment vehicle that affected my quality of life not one bit but is certainly making a difference now. f

***********************************
Computer Chips

Because of the blog, I have a pretty good "understanding" of this story. From MarketWatch, another Intel product delay drags on chip stocks, Dow. Intel revealed Tuesday that the next generation of its Xeon Scalable data-center processor, code named “Sapphire Rapids,” would come out later than expected because it was building new features into the chip.

But look at this: it's still a 10-nanometer chip. Apple is moving toward a 3-nm chip.

Last year, Intel had forecast its 10-nanometer Sapphire Rapids would come out some time in 2021, about a month after it announced a delay of its generation of 7-nanometer chips out to at least late 2022. 

In chip parlance, nanometers, or nm, refer to the size of the transistors that go on a computer chip, with the general rule being that smaller transistors are faster and more efficient in using power. 

In January, then-incoming Intel Chief Executive Pat Gelsinger started addressing the 7-nm chip delay, and in March announced aggressive plans to build out Intel’s manufacturing capabilities. 

In a note titled, “Do you want to hear the good news or the bad news
first?” Bernstein analyst Stacy Rasgon speculated on why Intel was making this announcement because he couldn’t “imagine the company would do this unless it was necessary.” Rasgon has an underperform rating on Intel and a $43 price target.

Also here from Ian King, "Intel falls on latest server chip delay; rival AMD gains."

***************************

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.

Billionaire Duo Keeps Danaher Grip While Giving $3.3 Billion -- Bloomberg -- June 29, 2021

I posted a story about Danaher a few days ago. Now this:

Link here.

Steven and Mitchell Rales, the billionaire brothers behind industrial conglomerate Danaher Corp., shifted $3.3 billion in shares to their charitable foundations in one of the largest ever transfers of its kind.

The move earlier this month allocates billions for future donations from two of the world’s wealthiest people, who’ve eschewed the limelight while building a high-tech manufacturing empire. In addition to life sciences-focused Danaher, they own stakes in machinery company Colfax Corp. and advanced instrumentation-maker Fortive Corp.

“We’re not leaving the Earth with any money,” Mitchell told the Washington Post in 2018. “When we go, there’s not going to be money bestowed on children and grandchildren in any meaningful way.”

Steven, 70, and Mitchell, 64, are worth $10 billion and $7.9 billion, respectively, according to the Bloomberg Billionaires Index, making them the 250th and 358th richest people in the world.

Their fortunes have been propelled by shares of Washington, D.C.-based Danaher, the firm they founded almost four decades ago. Its stock is up 22% this year to a record high, boosted by hunger for lab products and this month’s $9.6 billion cash purchase of Aldevron, a maker of the building blocks of mRNA vaccines.

Much more at the link.  

Archived. 

There are probably some interesting dots to connect. Note: "Wei" and "kaizan."

Kraken With Three More Permits -- June 29, 2021

Weekly US crude oil data, API:

The American Petroleum Institute (API) on Tuesday reported a draw in crude oil inventories of 8.153-million barrels for the week ending June 25, 2021.

Analysts had predicted a draw of 4.686 million barrels for the week.

In the previous week, the API reported a draw in oil inventories of 7.199 million barrels after analysts had predicted a draw of 3.942 million barrels. Crude oil inventories have fallen by more than 37 million barrels since the start of 2021, according to API data, but are still up 19 million barrels since January 2020.

Comment: we'll see the EIA data tomorrow.

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

Active rigs:

$73.45	6/29/2021	06/29/2020	06/29/2019	06/29/2018	06/29/2017
Active Rigs	22	10	61	67	59

Three new permits, #38404 - 38406, inclusive:

• Operator: Kraken
• Field: Burg (Williams County) (in the far northwest corner of the state of North Dakota)
  
• Comments:
• Kraken has permits for three Sidney wells to be sited in lot 4 section 5-158-99 Burg oil field;
• the wells will be sited 349 FNL and between 981 FWL and 1047 FWL; the well heads will be thirty-three feet apart;
• there are some fairly decent wells in this area

Permit renewal:

• Rimrock: one Two Shields Butte permit in Dunn County.

Four producing wells (DUCs) reported as completed:

• 36237, drl/A, Slawson, Neptang 3-15-22H, Big Bend, first production, 4/21; t--; cum 21K 4/21;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	4-2021	29	21333	20355	20834	13943	0	13800
BAKKEN	3-2021	0	0	0	0	0	0	0
BAKKEN	2-2021	28	0	0	0	0	0	0

• 37555, loc/A, CLR, Norway 11-5H, Fancy Buttes, minimal production announced;
• 36470, drl/A, Slawson, Periscope Federal 8-10-11-12H, Big Bend, no production data, 
• 36473, drl/A, Slawson, Periscope Federal 9-10-7TFH, Big Bend, no production data,
  

US Supreme Court Rules In Favor Of PennEast Pipeline -- June 29, 2021

Pipelines: US Supreme Court sides with PennEast regarding eminent domain and pipelines. Link here. 

Ruling leaves in place longstanding pipeline routing practices. Pipelines had feared state veto power on condemnation. Google the blog for occasional notes regarding PennEast. Also, link here. Note how close this vote was: one judge could have overturned this.

The court ruled 5 - 4 that a pipeline company can use federal eminent domain authority to build a line across state-owned land and private lands where easements have been granted by states. This suggests that states can't have it both ways: an easement for a state-approved pipeline but not a permit for a federally permitted pipeline using the same easement.

 ******************************
No Deal
Saudi - Sempra - Port Arthur

See "Saudi Arabia in transition" from yesterday, June 28, 2021.

Today, over at SeekingAlpha, "Sempra, Saudi Aramco unable to seal deal tied to Port Arthur LNG." Also here.

That explains why this:

********************************
The Yolk's On Goober

Link here. 

The Grid -- June 29, 2021

EVs? Has anyone really thought this through?

Later afternoon, ISO-NE. At the site, New England is burning oil to produce electricity. Five percent of region's electricity comes from renewable energy (all types) and three percent of region's electricity comes from oil.

Earlier this afternoon, ISO-NE. 

Portland, OR, June 28, 2021, NBC News: Portland, OR hit third-highest temperature ever recorded in a major US city. 

Portland, OR: 

EVs do not have the range of ICEVs. Period. Dot.

• EVs take well over an hour to get a full charge.
• driving cross country from Portland, OR, to Flathead Lake, MT, we stopped at major tourist destination, St Regis, MT. Two gas stations.
• Cars lined up to get gasoline.
• I pulled in; filled tank in less than three minutes; drove away in less than five minutes.
• Now, imagine that same line of cars, lined up to charge for at least an hour.
• Yes, I know --- as many charging stations as you want to put in -- imagine the footprint of that parking lot to charge all those cars
• then, realize that parking lot would sit empty nine months of the year
• at St Regis: five EVs would have "gummed up" the system; now imagine a thousand EVs in that 24-hour period
• investment opportunity? Copper.
  

Today's Feature Story -- June 29, 2021

The link sent to me by a reader. I would have missed it. Great story. Pretty amazing. 

Link here.

By-line: Sidney, MT.

Archived.

A Bitcoin mine operating out of an old mill building near Missoula, for example, attracted criticism after county officials said it was using as much power as a third of the households in the county. Additionally, researchers at the University of Cambridge estimate that Bitcoin currently consumes nearly 94 terawatt-hours of power a year globally, more than the combined consumption of the 108 million people who live in the Philippines.

The server containers on the Kraken well site are owned by Denver-based Crusoe Energy Systems, a venture-capital backed startup founded in 2018 that markets itself as a partner for oil companies looking for an economical way to cut back on their flaring. In eastern Montana, Crusoe buys otherwise stranded gas from Kraken, pipes it into the onsite-generators, and uses the resulting power to crack Bitcoin free from the ether.

Cully Cavness, Crusoe’s co-founder and president, said in an interview that the company also makes its server farms available to people who need other computationally intensive work performed, such as training artificial intelligence models or rendering computer animations. He said the company has donated computing power to Folding at Home, an organization that helps research on COVID-19 and other biochemistry topics by simulating the atomic interactions at play in protein molecules.

Bitcoin mining, however, is Crusoe’s main effort at the moment. The company, Cavness said, has a dedicated network engineering team that works out how to connect each well-pad server farm to the rest of the world, using satellite internet, microwave transmissions or, in some cases, custom-built fiber optic lines that can also bring broadband service to nearby rural customers.

The company isn’t the only ongoing effort to leverage well pad natural gas for Bitcoin mining in the U.S., but Caveness said Crusoe is the largest startup in the space. He said the company currently has about 40 data centers in operation, mostly on the Bakken in Montana and North Dakota, but is also operating in Colorado and Wyoming and plans to expand into other oil-producing areas.

“We’re growing it pretty quickly today. We’re looking to be at about 100 within months,” he said.

Caveness said he considers the company’s model an effective answer to the environmental concerns around cryptocurrency’s energy consumption, both because flares don’t necessarily burn all the methane present in well pad gas and because generating mining power off the gas offsets power usage that would otherwise have to come from somewhere else.

Notes From All Over -- Mid-Morning Edition -- June 29, 2021

The last Tuesday of 2Q21. Only 179 shopping days until Christmas.

Market: I would assume money managers were getting ready to close their books on 2Q21 last week. The market is relatively flat today, but the three major indices are all green, and apparently the S&P 500 hit another record high.

US consumer confidence:

• rises to more than one-year high in June; link here.
• highest level since the Covid-19 pandemic started more than a year ago;
• a reading of 127.3 in June, 2021, the highest level since February 2020, from 120.0 in May

Jobless:

• there appears to be a direct relationship between benefits and joblessness; who knew? Link here.

Coal: is dead! Long live coal.

• Glencore's billionaire bos Ivan Glasenberg made one final deal in his last week at the company
• bought out two rivals in a giant Colombian coal mine
• coal is now priced at highest level in thirteen years;
• link here;
• coal at these high levels? Glasenberg says the same thing will happen with oil and natural gas; link here;
  

Pipeline completions:

• EIA graphic; link here.
• sixth best year since 2010;
  

Gasoline, US supply in days: one has to go back a year to see the supply drop to less than 29 days. Link here. 

July 4th gasoline:

• expensive; average will be about $3.10 / gallon and probably increase throughout the summer;
  
• question: will there be enough?
• link here;
• the issue is not "supply" from the refiners; refiners producing record amounts of gasoline; the problem? not enough drivers to transport the gasoline to service stations; link here; 
  

Covid-19:

• what's the ethical argument against vaccinating teenagers? Link here.
• Covid cases now rising by 23,000 in a day -- the biggest rise in five months;
• the vaccines appear to work against the Delta variant

Airlines:

• United Airlines with huge aircraft buy; will hire / re-hire 25,000 union workers over next few years. Link here: https://www.foxbusiness.com/economy/united-airlines-hire-25000-boeing-largest-order-ever.

EVs:

• after kickstart from GM, Honda says it will now build its own EVs. Link here: https://www.foxbusiness.com/lifestyle/general-motors-honda-electric-vehicles.
  

Apple:

• Apple has dramatically increased the amount of iCloud user data it stores on Google Cloud; link here;
• Apple now has over eight million terabytes of data stored on Google's servers; no denominator provided;

Jodge Boasberg:

• dismisses antitrust lawsuits against Facebook; link to The WSJ;
• the dismissals, which came in a pair of rulings, came before any pretrial proceedings had progressed;
• the judge dismissed the case brought by 46 states in its entirety on the grounds that the attorneys general waited too long to bring their claims;
• shares surge
• US now has five companies with market cap greater than $1 trillion;
• The rulings dealt a direct, early blow to bipartisan government efforts to pursue Big Tech giants on allegations they have unlawfully monopolized the marketplace. They also served as a reminder that antitrust cases—particularly against dynamic tech-sector firms that offer free, nontraditional products—can be difficult to win before federal courts that have narrowed the reach of antitrust laws over several decades.
• “This really stings for the agencies,” said George Washington University law professor William Kovacic, a former FTC chairman. “The FTC and the states I’m sure used the best talent they had to bring these cases, and they have been knocked out at the earliest stage.” 

SRE:

• Sempra raises full-year guidance; link here;
• shares plunge;
• price target raised to $154 from $137

BAC:

• boosts quarterly dividend by 17%;

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. 

Global warming:

• hottest temperatures recorded in Canada; link here;
• sixteen locations provided:
• only two occurred this millennium, both in 2014
• nine occurred before the end of WWII
• one occurred in 1886

No Wells Coming Off The Confidential List -- June 29, 2021

Active rigs:

$73.23	6/29/2021	06/29/2020	06/29/2019	06/29/2018	06/29/2017
Active Rigs	22	10	61	67	59

No wells coming off confidential list.

RBN Energy: supercritical CO2 for long-haul piping and enhanced oil recovery, part 4. 

The vast potential for permanently storing carbon dioxide underground by using it for enhanced oil recovery can only be realized if produced or captured CO2 can be economically transported long distances via pipeline. And the only way that can happen is if the CO2 is compressed into a “supercritical” or “dense-phase” fluid — a state that is somewhat compressible like a gas but flows and can be pumped like a liquid. When CO2 is in a supercritical state, much more of it can economically flow through a pipeline to the producing field. And when it gets there, the dense-phase CO2 can be injected into an oil production zone, where it has the unique ability to flow through permeable rock formations, bond with and “swell” trapped oil molecules, and free the oil to move to the production well, then up to the surface. Given that CO2-based EOR is destined to become a much more significant activity in the energy industry, it’s time for a fun-filled review of the thermodynamics of fluids as it relates to the transportation of CO2 and its use in the production of crude oil. (Wait! Don’t leave! This will be easy to follow! We promise!) Today, we continue our series on the rapidly evolving CO2 market and why it matters to crude oil producers.

CO2 sequestration is the permanent storage of CO2 deep below ground in rock formations, oil and gas reservoirs, coal seams, etc. If the CO2 is captured and stored, and that’s all, the process is called CCS (Carbon Capture and Storage). On the other hand, if the CO₂ is used for some other process before it’s stored, it is called CCUS (Carbon Capture, Use, and Storage). EOR is a form of CCUS, and a very economic one at that. In EOR, CO2 is pumped into the production zone of an otherwise depleted oil field, then mixes with and frees the oil that has been left behind. Some of the CO2 used in this process stays underground, permanently trapped in the reservoir. The rest of the CO2 comes out of the ground mixed with the oil, then is separated and recycled back into the field — a process that goes on until all the original CO2 used is trapped beneath the surface.