An XTO Bobcat Federal Well Trending Toward 600K Bbls Crude Oil After Just Two Years -- July 15, 2021

The well:

• 34358, 30 (sic), XTO, Bobcat Federal 14X-35EXH, Bear Creek, t5/19; cum 413K 6/20; cum 567K 5/21;

The Bobcat Federal wells are tracked here.

Full production profile:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	5-2021	31	12422	12528	13151	37606	27040	10545
BAKKEN	4-2021	27	12029	12151	13097	27397	26268	1118
BAKKEN	3-2021	21	7461	7823	7374	21007	20475	522
BAKKEN	2-2021	28	9637	9466	10486	32302	32068	214
BAKKEN	1-2021	31	13711	13726	14183	47100	47093	0
BAKKEN	12-2020	31	15530	15496	15028	45722	44925	781
BAKKEN	11-2020	30	16782	16922	15573	47877	40185	7684
BAKKEN	10-2020	31	18721	18505	16907	27274	21783	5472
BAKKEN	9-2020	19	7502	7791	7701	10493	6758	3713
BAKKEN	8-2020	31	19326	19036	17287	32365	18548	13791
BAKKEN	7-2020	31	20913	20998	18635	36420	26710	9674
BAKKEN	6-2020	30	21590	21845	18327	46208	44044	2127
BAKKEN	5-2020	31	29073	28854	23145	58360	54778	3552
BAKKEN	4-2020	30	28726	28967	23563	48333	45293	3038
BAKKEN	3-2020	31	28497	28149	22692	39371	38981	295
BAKKEN	2-2020	15	12240	12462	11997	16366	12400	3920
BAKKEN	1-2020	29	25617	25547	21390	35210	24156	10965
BAKKEN	12-2019	31	33870	33738	29159	45931	32965	12863
BAKKEN	11-2019	30	34869	35105	29572	39324	33176	6048
BAKKEN	10-2019	31	34492	34576	34518	38276	38172	0
BAKKEN	9-2019	30	38132	38221	34052	51275	44198	6977
BAKKEN	8-2019	31	48796	49057	56932	63347	57779	5466
BAKKEN	7-2019	31	62002	61806	52245	80462	2054	78313
BAKKEN	6-2019	13	14974	14228	18060	16881	8076	8769
BAKKEN	5-2019	17	395	0	9563	944	0	944

 

Notes From All Over -- The Late Night Edition -- July 15, 2021

In 72 hours, the buzz coming out of Wall Street, all that talk about an anticipated oil shortage looks premature. The conversation is back to too much oil. And a stronger dollar driving down the price of oil. Maybe for all of those who have been accumulating energy stocks in the past six months, time to take some profits. I continue to accumulate but I'm being very, very picky.

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.

By the way: a stronger dollar? Who would have guessed. Look how fast this changed. Compare:

• January, 2020 - April, 2021
• May 11, 2021 - June 16, 2021
• June 20, 2021 - July 15, 2021

Structural deficit:

"This Saudi / UAE spat is being overblown ... oil market in 'voluntary deficit' now and multi-year structural deficit in 2022+. That is all that matters." -- Eric Nuttall

The promise of stock buybacks isn't going to cut it. Maybe analysts like "stock buybacks" but mom-and-pop retail investors don't. They want to see dividends increased or initiated. By the way, think about this:

• energy companies in general already pay huge dividends (at least the ones that interest me);
  
• with drop in equity prices, those dividends, on a percentage basis, just got bigger; and,
• no energy company will dare cutting its dividend; in fact, even if the dividend is not increased this year, there could be hell to pay, as they say.

And we'll end with this tonight: Cheniere gas supply deal with Canada's Tourmaline lifts LNG expansion in Texas. Link here.

• 15-year pact
• tied to the Corpus Christi Liquefaction terminal in Texas

Notes From All Over -- The Early Expedited Edition -- July 15, 2021

Oh, really? It seems we're seeing more and more articles that confirm what "we" already knew. First, the "global vaccine burnout" article. Now, this one: renewables growth cannot keep up with surging electricity demand.   

Link to Tsvetana Paraskova. Anyone paying attention knew this to be the case -- and they've known this for at least ... like forever. From the linked article:

Global power demand is rising so fast this year after the 2020 slump that even the continued strong growth of renewable electricity generation will not be enough to meet it, the International Energy Agency (IEA) said on Thursday, warning that coal power generation will jump and threaten efforts of emissions reduction.

This year, global electricity demand is expected to surge by 5 percent from the levels of 2020, when power consumption fell by around 1 percent due to the effects of the pandemic, the IEA said in its semi-annual Electricity Market Report published on Thursday.

Thanks to the global economic recovery, electricity demand worldwide is also expected to rise by another four percent in 2022.

Electricity market report, IEA, July 2021: report here.

Apple, Inc, future:

• it was recently reported that Apple is going to ramp up production; internal analysis already suggests Apple won't be able to keep up demand; this may be one of the reasons:
• the iPhone 13 set to launch later this year will feature the improved WiFi 6E protocol
• Apple introduced WiFi 6 with the iPhone 11 in 2019, and compared to the previous WiFi 5 framework, WiFi 6 offers significantly improved speeds and security. WiFi 6E adds minimal changes compared to WiFi 6 except for an added 6GHz band, which will result in increased bandwidth and less interference for devices that support Wi-Fi 6E.

Apple, Inc, history:

• The latest research from Consumer Intelligence Research Partners (CIRP) shows that all four iPhone 12 models accounted for 63% of total iPhone sales in the United States in the quarter ending June 2021; link here;
• the highest-end iPhone 12 Pro Max tied with the year-old iPhone 11 for the largest share of any single model at 23%, while the iPhone 12 mini and iPhone XR had the smallest share, each at 5%, according to CIRP. As pandemic-related restrictions ease in the United States, the Chicago-based research firm said increased consumer spending correlated with consumers shifting to more expensive iPhone models.

Apple, Inc.,  more chips:

• Apple chip supplier TSMC has confirmed that it will begin mass production operations at its new factory in Arizona in 2024. From the article:

TSMC Chairman Mark Liu announced that the company's $12 billion factory in Phoenix, Arizona, which is currently under construction, will begin mass production in the first quarter of 2024. While the 2024 timeframe had previously been rumored by Bloomberg, TSMC's announcement serves as a confirmation and indicates that the project is on track.

The first batch of engineers hired to staff the new U.S. factory arrived in Taiwan in late April this year for training, and the company is looking to accelerate its schedule for the facility as much as possible.

The facility will mass-produce chips fabricated with a 5nm process. TSMC has been gradually miniaturizing its process over the years, going from a 16nm A10 chip in iPhone 7 models, to a 7nm A13 chip in iPhone 11 models, and most recently a 5nm process for the iPhone 12's A14 chip. Likely clients for the chips made in the Arizona factory include Nvidia, Qualcomm, and Apple. The new Arizona plant will make it theoretically possible for Apple's 5nm custom silicon chips, such as the A14 or M1 chip, to be manufactured within the United States.

TSMC's main factories are located in Taiwan, but it already operates a factory in Camas, Washington, as well as design centers in Austin, Texas and San Jose, California, meaning that the Arizona facility will be its second manufacturing site in the United States. 

Passports: backlog has gotten significantly worse. Links everywhere. Houston Chronicle: "a complete nightmare: US passport wait times double for post-Covid summer travel." From the passport office just down the hallway from the USPS: 

Due to increased demand, a shortage of appointments and delays with the U.S. Post Service, the State Department now says that those applying for a new or renewed passport should expect to wait up to 18 weeks for their document. That wait time drops to 12 weeks if you pay $60 extra for expedited processing.

Only the US government would consider "twelve weeks" expedited. LOL.

Disney: to relocate 2,000 California jobs to Florida. Link here.

"In addition to Florida's business-friendly climate, this new regional campus gives us the opportunity to consolidate our teams and be more collaborative and impactful both from a creative and operational standpoint." 

California's virus lockdowns shuttered Disneyland there for months while Disney World (Florida) were shut down for four months and opened to limited capacity a year ago. 

Masks are back in Los Angeles, as of July 16, 2021.

Los Angeles: just announced that masks are back. 

Notes From All Over -- July 15, 2021

Time to move on: for the archives, from Reuters, "Vaccination Burnout," July 13, 2021. The title, "vaccination burnout" pretty much says what everyone -- who doesn't live under the Geico Rock -- already knew. It's time we started treating Covid-19 just like "season flu." Offer the vaccine. Forget the rest. Move on. 

Landing strip: pretty funny. A group of US senators flew to Taiwan the other day. They flew there in a "large" military cargo plane. LOL. Now why in the world would they do that? LOL. Link here. And they said Trump was dangerous. LOL. 

Personally, I could / couldn't care less. The only reason I even pointed on the article: I was curious what "large" military cargo plane was used? Reported in the Chinese state-run Global Times it was a "US C-146A Wolfhound." From The US Air Force website:

The C-146A is a twin-engine, high-wing aircraft equipped with a configurable cabin capable of various passenger and cargo combinations, as well as casualty evacuation missions. The aircraft can carry a maximum of 27 passengers, 6,000 pounds of cargo, or up to four litter patients.

Large. LOL. Twenty-seven passengers and up to four litter patients. This is a puddle hopper.

If the Chinese think this is a "large" military cargo plane, "they haven't seen nothin' yet." LOL. 

Chips: Intel in talks to buy GlobalFoundries for $30 billion. Link here. GlobalFoundries, you ask? LOL.

• GlobalFoundries is owned by Mubadala Investment Co., an investment arm of the Abu Dhabi government
• based in the US
• one of the largest specialist chip-production companies in the world
• it was created when Intel rival Advanced Micro Devices, Inc., in 2008 decided to spin off its chip-production operatiosn
• AMD: remains a big customer for Global Foundries
• GlobalFoundries: relocating its headquarters from Malta, NY, to Santa Clara, CA
• much more at the link

Chips: shortage issue coming to an end? Link here.

• TMSC suggests the chip shortage may soon be a thing of the past
• TMSC, first expansion ever: to Japan
• TMSC also considering expanding in to China and the US. Whoo-hoo!
   
• TSMC's chips are in "billion of products", including iPhones, computers and cars, the Wall Street Journal writes in a new profile of the company. The company has slowly become the world's 11th most valuable company, with a market cap of about $550 billion. The company reported $17.6 billion in profits last year on revenues of about $45.5 billion. TSMC makes "around 92% of the world's most sophisticated chips," the report says. 
• could this be one reason why that group of US senators flew to Taiwan on a "large" military cargo plane, to see what TMSC was up to

 

Notes From All Over -- The Late Afternoon Edition -- July 15, 2021

First things first: new Wes Anderson movie, debuted July 12, 2021, in Cannes, France, will open in the US this October, 2021. Link here. Reviews are mixed but fans of Wes Anderson are likely to be thrilled. 

New Mexico comes in at #2. North Dakota drops to #3. Link here. Seventy-two rigs in New Mexico; twenty-three rigs in North Dakota. Nice.

Latest Goldman oil report: previously reported. Here's the summary.

WTI falls: stronger dollar. Also, due to "surprise jump in US gasoline and distillate stocks." Link here.

Ten-year treasury: closes at 1.296% yield. Jim Cramer, interestingly, starts out with this in his opening monologue. This is truly most confusing. If inflation is so bad, why are bonds yielding so little? And, here: Walter Bloomberg -- US ten-year treasury yields fall to session low of 1.299%.

Apple, Inc.: Xiaomi surpasses Apple to become number two worldwide smartphone vendor in 2Q21. Link here. Look at the annual growth at the link. 

Swing demand: this is pretty cool. We've been talking about "swing producers" for the past two or three years. All of a sudden, are we ready to start talking about "swing demand"? Link to Charles Kennedy, China to tap coal reserves as prices soar. 

from EIA annual electricity market report -- coal-fired electricity generation will increase by almost 5% in 2021 bo exceed pre-pandemic levels. It will grow by a further 3% in 2022 and could set an all-time high." Link here. 

Huge: TSMC signals global chip crunch may be easing. Behind a Financial Times paywall, but more stories will be coming out over the next week or so. 

Weekly natural gas report: link here.

No Daily Activity Report Today Due To "System Maintenance" -- July 15, 2021

Active rigs:

$71.65	7/15/2021	07/15/2020	07/15/2019	07/15/2018	07/15/2017
Active Rigs	23	11	58	67	58

No report today due to "system maintenance."

The "Director's Cut" is also pushed out to July 20, 2021, one of the latest, if not the latest, monthly release, ever.

Most Under-Reported Story Of The Day -- July 15, 2021

Will Phil LeBeau cover this story? I doubt it, but if he does, he will call it "overblown."

Bolt: GM tells Chevy Bolt owners park it outside and away from structures. Link here. 

By the way, aren't most home-owned charging stations located inside the garage? Oh-oh.

Going swimming. Should hit 97 degrees today. Whoo-hoo. The last couple of days have been a bit cool, in the low 90’s and windy, making it feel cooler.

************************
Solving Problems One Migrant Worker At A Time

This is pretty cool.

Unless you've been living under the Geico rock you are well aware of the over-supply of migrant workers coming to the United States, to the extent that the federal government, i.e., the United States Air Force, is transporting them across the fruited plain(s). 

When visiting southern California, I noted one could hire day workers in small packages, anywhere from one worker to three or four workers depending on the size of the job. The workers were always on display on street corners at major intersections.

But they say everything is bigger in Texas and one big box store is taking day-workers to a whole new level.

Just down the street from where we live, outside a big box, high-end, discount store, truckloads of migrant workers are now arriving. Instead of buying / renting by the handful, here in Texas one can rent / buy by the truckload. Of course that only makes sense: the projects are huge compared to what I saw in California.

I can't make this stuff up.

**************************
The Golf Page

The Open.

I don't care for Phil Mickelson but I do admire him for showing up at every tournament, unlike Tiger Woods who always seemed to pick and choose what he would play. 

But at The Open on the opening day, Phil is dead last in a field of 158 golfers. Plus eight, no birdies, eight bogies through seventeen holes.

The leader? Six under. I think it's a safe bet to say Phil won't be playing the weekend.

Rambling -- Not Ready For Prime Time -- July 15, 2021

Cathie Wood: CNBC's "exclusive" interview yesterday at 4:00 p.m. ET was superb. I'm watching, waiting, hand on the trigger. ARKK. This might be a new holding for Sophia.

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. 

Jim Cramer: his closing rant last night on Mad Money was right on point. He wants higher wages for workers and he unequivocally supports Jay Powell, who appears to want the same thing.

Household cash:

• money market funds have $1 trillion more than they did pre-pandemic
• money market funds: at record holdings? I believe they are at a record; fact-check please.
• link here; "near" record high
• look at huge jump beginning January, 2020
• incredible
  
• money market rates: 0 percent.
• this is not rocket science

Money market funds (running just the opposite of the Saudi Arabia foreign reserves assets chart):

• comments:
• so, money in money market funds had been running at $3 trillion, like forever;
• then, January, 2019, to November, 2019, these funds jumped from $3 trillion to nearly $4 trillion
• but literally, overnight, from December, 2019, to March, 2020, jumped from nearly $4 trillion to solidly over $5 trillion
• that's a lot of money providing zero return when the equity market is paying on average about 3% and appreciating at the same time;

Netflix: popped at the open, then gave it all back before noon. Watch this one.

NFLX is running at its highest level ever. "Netflix won't chill." -- CNBC. Huge announcement today. Will enter gaming. And it will be a huge investment. Had already announced an eye-popping $17 billion in content spending in fiscal 2021. Link here.

 

***********************
Global Warming And China

For the archives. 

Link to the Daily Mail. 

Just 25 "mega-cities" produce 52 percent of the world's urban greenhouse gas emissions:

• 23 are in China; the other two: Moscow (#7) and Tokyo (#17)
• not one US city in the top 25
• among the top 100, the US cities:
• NYC (#26)
• San Diego (#41)
• Houston (#44)
• Chicago (#47)
• Los Angeles (#55)

More importantly compare tons of annual emissions.

Examples:

• Chinese cities trending toward 200 "units"; and there are 23 of these cities.
• NYC: 51
• San  Diego: 35
• Houston: 33
• Chicago: 31
• Los Angeles: 27

And China still gets a pass on CO2 emissions. I think China says they set 2060 as the year they hope to be "net-zero.

FWIW.

Notes From All Over -- The Investors' Edition -- July 15, 2021

Tractor Supply (TSC): up nicely today. 

BK: increases its dividend. Whoo-hoo. Had been 31 cents for eight consecutive quarters. Will increase dividend by ten percent to 34 cents and authorizes repurchase of $6 billion of common stock.

Ten-year treasury watch: yield = 1.37% or thereabouts. Early this morning, the yield "flash-dropped" to 1.25%.

AAPL watch: closer to $150 than $149. But that is changing minute-to-minute today. Later: drops below $149.

• makes controversial changes to Safari in iOS 15.

Bolt: GM tells Chevy Bolt owners park it outside and away from structures. Link here. 

Saudi: self-reporting -- its crude production rose by 383K bpd month-over-month, to slightly less than 9 million bopd. Link here. 

Meme stocks:

• Melvin and Mapleland, The Wall Street Journal, July 10, 2021;
• Melvin Capital, The Wall Street Journal,  January 31, 2021;

Morgan Stanley: doubles dividend and makes notable stock buyback announcement. Unusual for a bank.

Virgin Galactic: plunges. Link here. Posted yesterday, the freefall. Due to announcement that Virgin says it will authorize new stock equity sale. 

Oman: link to Simon Watkins.

***********************************
Covid-19 -- The Japanese Olympics

From The LA Times:

Japan’s COVID cases rise as Olympics near

In a week, the now anachronistically named Tokyo 2020 Olympics will finally get underway.

It’s a moment Japan has long been preparing for — since March of last year when the Games were pushed back because of the pandemic; since 2016, when Japan’s then-Prime Minister Shinzo Abe took the baton from Rio de Janeiro in a Super Mario get-up; since 2013, when the country first clinched its hard-fought bid.

Even so, the country heads into the Olympics with a resignation and a reckoning over how leaders handled a pandemic marring what should be a marquee moment for national pride. Many Japanese are thinking less about races and gold medals than the fact that Tokyo is in a fourth state of emergency. COVID-19 infections are again on the rise, and supply problems have stalled a vaccination program.

With a week to go until the opening ceremony and fears the highly infectious Delta variant will bring more danger, less than a third of Japan’s 120 million people have received one dose of the vaccine, and less than 20% are fully inoculated.

The best-case scenario the Japanese public can hope for is an uneventful Games that ends with the country — and the world — not much worse off than going into it. Hardly an Olympian aspiration.

No Wells Coming Off Confidential List -- Jim Cramer Calls It -- Oil At Its Peak -- July 15, 2021

Bolt: GM tells Chevy Bolt owners park it outside and away from structures. Link here. 

Oil: may be at a peak. Natural gas users overseas switching to coal.

• don't panic: GS remains bullish on oil; holds to $80-Brent;

Cramer: if Jim is correct, Kathy Woods may not have been too far off. 

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

Active rigs:

$72.37	7/15/2021	07/15/2020	07/15/2019	07/15/2018	07/15/2017
Active Rigs	23	11	58	67	58

No wells coming off confidential list today.
 

RBN Energy: switching from natural CO2 to captured CO2 for enhanced oil recovery.

The handful of enhance-oil-recovery producers in the Permian Basin secure virtually all of the carbon dioxide they use from natural CO₂ reservoirs located thousands of feet below the surface. In essence, they are taking CO₂ out of the ground and putting it back in during the EOR process — producing more crude oil and demonstrating that the CO₂ is safely and securely stored underground. Now the challenge is to transform this proven process in a way that reduces greenhouse gas emissions. To do that, EOR producers would need to use man-made or “anthropogenic” CO₂ that is captured from industrial and other sources. Well, that’s exactly what’s already happening to a significant degree in EOR operations along the Gulf Coast and in the Rockies, with plans by a leading producer in both regions to use “A-CO₂” for the vast majority of its CO₂ needs within a few years. In today’s blog, we continue our series on CO₂-based EOR with a look at how Denbury Inc. is shifting from naturally sourced CO₂ to the man-made stuff.