Saturday, July 24, 2021

Olympics: Television Ratings Crash -- July 24, 2021

Before we get started, breaking news: Bryson DeChambeau kicked off US Olympic golf team: tests positive for Covid-19. Jon Rahm tests positive twice in one month. Patrick Reed, despite shaky reputation since his college days, to join US team in Tokyo.

Now, back to regular programming, Or not.

There were a gazillion reasons to explain this.

But, without question, the "woke" and "anti-American" attitude by the US athletes probably was the over-riding reason folks chose not to tune in. The "anti-American" attitude was probably the tipping point.

It works like this:

  • except for maybe Simone Biles there is no US star power (quick: name the dominant US male swimmer; it should be easier to name the dominant US female swimmer; quick: name the starting five on the US basketball team; quick: name the gymnast who turned her back on the US; was it a female gymnast? I forget)
  • opening ceremony lacked the "wow" element and folks knew that even without tuning in;
  • opening NBC coverage today: table tennis (ping pong); badminton; 3v3 basketball -- are you kidding me?
  • tape delay; time zone differences:

So, folks in the US have all these reasons to not watch the Olympics, and then when asked why they are not watching? Most will simply say, "not interested," but if questioned a bit further, they will admit, they are turned off the by politicization of the entire affair; this is happening across the entire sports spectrum.

Folks turn to sports to get away from everyday issues including politics, but the state of affairs is such that politics will play a huge role in the year's Olympics. 

Russia is banned from the Olympics. I wonder how many folks know that. But in fact, the Russians are participating; they just can't carry the Russian flag, so they wave the "Russian Olympic Committee" flag. LOL. 

Back to television ratings: the NFL should be immune but we will see. Some suggest the NFL will suffer a similar fate as BLM basketball. 

**************************
Vaccinations

The Washington Post is finally printing an inconvenient truth: the White House -- i.e., Dr Jill Biden and her husband -- are not requiring their staff to be vaccinated .

That speaks volumes.

The US athletes headed to Tokyo were not required by the US Olympic Committee to be vaccinated.

That speaks volumes. 

I learned today that some pediatricians are recommending that teenagers not get the vaccine even though the CDC highly recommends that. In other words, pediatricians, too, are winging it, not following the science. One wonders if those same pediatricians recommend that infants not get the polio vaccine?

That speaks volumes. 

On this one, I am aligned with Jim Cramer. But Cramer needs to point out that his own party leadership is not getting vaccinated. It would be interesting to get accurate count of the White House press corps vaccinated or not.

For Investors Only -- Nothing About The Bakken

I think there's a huge difference between "inflation" due to the "Fed printing money" and simply "a short-term surge in prices." 

Analogy:

  • "inflation" due to the "Fed printing money": long term, the price of oil will increase, all things being equal; contango is the normal state of affairs for commodities like oil, not backwardation; versus
  • simply a short-term surge in prices: the surge in the price of oil when a Category 5 hurricane shuts down the Gulf of Mexico, Louisiana, and Texas;

The surge in the price of lumber had absolutely nothing to do with "the Fed printing money." 

Too much money chasing too few goods.

What causes too much money? Right now, it's not due to "the Fed printing money." 

What causes too few goods? It's not lack of production, per se. 

House prices did not appreciate 20% (or whatever it was) because there was too much money being "printed by the Fed." 

The current Fed chairperson, a centrist, remains in the office for another six months or so; his replacement is likely to be a woman, also a centrist. In other words, no major changes over the next two years.

Whatever. We move on.

We move on to the graphics below and the very interesting Bloomberg story today (see below).

Amazing graphics:

Graphic above:

  • A: trajectory when folks thought we were coming out of the pandemic; extend line A and we're easily at 36,000 for the Dow;
  • B: trajectory when vaccinations slowed down; and delta variant emerged
  • C: trajectory not seen; when delta variant concerns dissipate, probably beginning in October, 2021;

The graphic that absolutely amazes me

Someone is reading the blog. From Bloomberg via Yahoo!Finance today:$17 trillion "on the sidelines.


In the stock market, the refusal of retail investors to back down from every macro threat has become the only story. When will it end? Judging by the size of all the pools of cash lying around, it could be a while.

Among all the economic stories of the pandemic, the one about money piling up in people’s accounts has been the most significant in the stock market, where the S&P 500 just notched its seventh gain in nine weeks. Money market accounts, viewed in some circles as a “dry powder” reserve for equity deployment, sit at just under $4.5 trillion. A more obscure balance, the Federal Reserve’s count of money on deposit with commercial banks, has risen 33% from 2019 to $17 trillion.

While none of the money is completely unencumbered and professionals tend to hate the concept of “cash on the sidelines,” something is arming the day-trader cadres who seem bent on letting no market selloff last more than 24 hours. Take Monday, for example, when fears the delta variant would upend progress sent the S&P 500 down as much as 2.2%. Dip buyers ran to the rescue then and the rest of the week, sending the S&P 500 higher by almost 2% through Friday, despite virus cases still spiking.

How powerful is the retail cannon? On Monday alone, they bought a record $2.2 billion worth of equities, with the biggest exchange-traded fund tracking the S&P 500, ticker SPY, alone notching an all-time high of $482 million in retail purchases, according to Vanda Research. An analysis from DataTrek Research showed that Google searches in the U.S. that day for the phrase “dow jones” -- the term most associated with stock market investing, according to the firm -- spiked when stocks declined quickly, peaking at 1 p.m. in New York.

“It’s almost like investors are seasoned to say, stocks are down, it’s got to be a buying opportunity,” said Gene Goldman, chief investment officer at Cetera Financial Group. “Part of that is because there’s no other game in town right now. You look at bond yields so low, cryptocurrencies struggling, other parts of the market are not that great.”

The unending appetite for stocks led equity ETFs to break their annual record in April, and the pace hasn’t slowed since. In July, the products have already taken in more than $15 billion, helping fuel total ETF inflows to the brink of a full-year record, with more than five months to go.

Still, other measures of retail prowess show a mixed picture. Data from Charles Schwab shows that the percentage of cash in their clients’ brokerages accounts in June fell to 10.5%, the lowest since 2018.

“That probably suggests that the dry powder has been put to work over the course of the year, but maybe it’s not entirely out of fuel for further investment,” said Jeffrey Kleintop, chief global investment strategist for Charles Schwab & Co. “There’s still a good bit of momentum and desire to put money to work and look for alternatives to the bond market which remains relatively unattractive.”

Much more at the link, but you get the point. 

At some point, GDP growth will slow down but I think the delta variant moved the graphic to the right (good news). 

If a recession is defined as a negative growth for "extended period of time" (two quarters), I don't see the next recession any time soon (defined as the next five years). 

I still maintain that 2020 - 2035 was compressed into 2020 - 2025 due to market changes due to Covid-19. 

Like the US economy, sitting pretty:


If Sophia looks exhausted, she is. In addition to a long day of swimming in 100-degree, bright-sun weather, she has been very, very busy with other activities.

A WPX Nokota Well Produced At A Rate Of 160,000 Bbls Crude Oil Over Thirty Days -- July 24, 2021

The WPX Nokota wells are tracked here

The well;

  • 37134, A/AF, WPX, Nokota 24-13-12HB, Squaw Creek, t--; cum 390K 5/21; 69K over 13 days extrapolates to 160K over 30 days.
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-202131261422621120108619294408714883
BAKKEN4-20213031921318932216853189496210
BAKKEN3-202131414124137326830545824989497
BAKKEN2-20212430537304542067040248321664696
BAKKEN1-202129397773984631805524263569212333
BAKKEN12-202031701376994848429924426545319322
BAKKEN11-2020308047480740581881060636024537051
BAKKEN10-202013691366869147438911214437539282
 

aa

The WPX Omaha Woman Wells Are Incredible -- 300K In Eight Months -- July 24, 2021

The WPX Omaha Woman wells are tracked here. These are incredible wells. One example. This well has produced over 300K bbls crude oil in eight months. 

The well:

  • 36864, drl/A-->F/A, WPX, Omaha Woman 24-13-12HD, Squaw Creek, t--; cum 65K in 29 days; cum 305K 5/21; stimulated 8/20; 52 stages; 209K bbls water; 12.8 million lbs proppant;

Full production profile:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-202131210852108119570452473142211409
BAKKEN4-202130237022374816964390142524511077
BAKKEN3-202131340953398720835561213007922239
BAKKEN2-202128250722492516598412681880819640
BAKKEN1-202126267152674219657439731461126381
BAKKEN12-202031541535412835628761944296327282
BAKKEN11-202030547295488143648770034140229595
BAKKEN10-20202964477641945802069007619720
BAKKEN9-2020152552063073962553
BAKKEN8-20200000000

A QEP Helis Well Goes Over 500K Bbls Crude Oil -- July 24, 2021

The well:

  • 22194, 1,248, QEP/Helis, Moberg 13-17/16H, Grail, t2/13; cum 497K 3/20; cum 514K 5/21;

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-2021311312127410113282322656
BAKKEN4-20211938352817968564031
BAKKEN3-202128124411345033836358354
BAKKEN2-2021288688812242560242321
BAKKEN1-202131642596358243622950
BAKKEN12-2020318038424863460320445
BAKKEN11-202029123112398015790542430
BAKKEN10-202031142414171180690765740
BAKKEN9-2020261383139010476040596041
BAKKEN8-2020312011202816747383730182
BAKKEN7-202029202120081265711171110
BAKKEN6-20203016571632116052064350618

A QEP Grail Well Goes Over 500K Bbles Crude Oil -- July 24, 2021

The well:

  • 21456, 2,014, QEP/Helis, TAT 13-35/26H, Grail, t7/12; cum 482K 3/20; came off line as of 4/19; back on line as of 5/19;  cum 500K 5/21;

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-202131173717311819142311620
BAKKEN4-2021301387139218635784496
BAKKEN3-2021178577896684093100
BAKKEN2-2021001340000
BAKKEN1-20213016061661145322981592110
BAKKEN12-202031210220691455287921770
BAKKEN11-20203018581923112724061683139
BAKKEN10-202031196218771274250218752
BAKKEN9-2020301861180114932132160886
BAKKEN8-2020189348867091139779147
BAKKEN7-202000370000
BAKKEN6-2020207798394461125809119

Haven't Reported This Well Before -- WPX Corral In Mandaree Goes Over 600K Bbls Crude Oil -- July 24, 2021

The well:

  • 21609, 138, WPX/Dakota-3, Corral 1-36HD, Mandaree, t5/12; cum 598K 5/21;

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-202118281526022651325716961170
BAKKEN4-2021213113331511133
BAKKEN3-20211000330
BAKKEN2-20212420792263438240642064
BAKKEN1-20213129212879560337915261378
BAKKEN12-20203128702823554416036900
BAKKEN11-20203025022504505289510601411
BAKKEN10-2020312381239453127561612726
BAKKEN9-2020302355235249727262342082
BAKKEN8-2020312142216346724781601926
BAKKEN7-2020311911170941822113271509
BAKKEN6-2020302060198129523858281185
BAKKEN5-202011743929220
BAKKEN4-2020302492265052327341649661
BAKKEN3-2020312721280857929857851745

Tokyo 202One Olympics -- July 24, 2021

Televised now on NBC: table tennis. Mongolian vs American. I love almost any sport but even I couldn't tolerate watching this. Five minutes and I was gone. No one in the stands except mask-wearing media -- still photography and video. Now watching Perry Mason re-runs. LOL. Are you kidding me? Stars a very, very young Robert Redford. Never, never expected this. The Case of the Treacherous Toupee.

Biggest concern: if Apple, Inc., misses estimates, all one has to do is look at what happened to SAM this past week. Wow, a drop from $1300 to $700 / share or something like that. Bloodbath. How does SAM even claw back from $700 to $1,000? 

Lawsuits: I would assume that's the next thing we will see -- with regard to SAM. And folks think Bitcoin is volatile / risky. 

Breakout! I am absolutely convinced that the pandemic compressed 2020 - 2035 into 2020 - 2025. Wherever you thought "we" would be in 2035, we will be there by 2025.

Now, another data point: according to GasBuddy data, Friday, yesterday, US gasoline demand jumped almost 4% from the prior Friday and was 3% above the average for the last four Fridays. In addition, gasoline demand was just 2% below the Friday before July 4, 2021, which broke records for consumption. And many folks say we are not truly open yet. Which is true. The US economy is yet to break out. I expect the earliest we will see signs of a breakout will be this autumn when schools open. 

Some say this is somewhat due to less mass transit and more private car use. I assume to some extent -- maybe great extent -- this is accurate. Which brings me to another subject. I once blogged that the successful companies coming out of the pandemic will be the "smart" companies -- the companies that:

  • used the twelve-month global lockdown to accomplish a lot of strategic planning; and,
  • used the time to prepare wisely for the opening of the economy which would occur sooner or later.

Exhibit A: SAM really, really missed the ball, as they say. And paid a huge price. The CEO admitted as much in the interview with CNBC. The CEO said they were not prepared for restaurants when they opened up. Wow, what a miss! What an admission!

The pandemic changed everything. The successful companies realized this twelve months ago and spent the last twelve months doing strategic planning.  

Shortest recession in history: really, really bad analysis; really, really bad headline. And this is why ZeroHedge struggles with credibility.

CNBC Said "Inflation Was Good" -- CNBC Was Not Incorrect -- July 24, 2021

In case you missed it, Social Security benefits could surge this year. Link at Yahoo!Finance

Senior citizens and disabled workers could be looking at the biggest boost to their Social Security benefits in decades next year — thanks to hot inflation now.

Beneficiaries could see their benefits increase by 5.8% in January 2022, according to a Bank of America analyst note, which would be the biggest boost since 1983. That’s also quite a bit more than January 2021’s increase of 1.3% to the cost-of-living adjustment or COLA that hasn’t been enough to keep up with this year’s inflation.

*************************
TCM

Wow, what a treat. I happened to catch the Coen Bros Blood Simple last night. I had seen the movie years ago but had forgotten much of the movie, but some scenes will never be forgotten. It's not a movie my wife could / would watch. 

But about a third of the way into the movie, it became obvious that David Lynch was greatly influenced by this movie, and at about two-thirds of the way into the movie, I about fell off my chair. A scene was so reminiscent of Mulholland Drive, I googled to check if anyone else had noted the similarity between Blood Simple (1984) and Mulholland Drive (2001). Except for one other person, the search was unproductive. 

I now forget which scene startled me the most with regard to connecting the two movies, but I think it was the scene in which Frances McDormand looks into the mirror.  There is a remarkably similar scene in Mulholland Drive.

It will be interesting to watch this movie (Blood Simple) again and really see how much of Mulholland Drive I see in the Coen Bros movie. 

Best part of all of this? The introduction by the presenters. Without question, the introductions are getting better and better on TCM.

Blood Simple was the Coen Bros first film; not only has it held up very well, but one can argue it's still one of their best. I think it was Frances McDormand's first film; she got the part when her roommate who was penciled in for the part was not able to take the role. 

Frances McDormand has won three Academy Awards for Best Actress, 1996, 2017, and 2020/2021. 

I may be reading the wiki entry incorrectly, but only one woman has won four Best Actress awards: Katharine Hepburn.

Only one woman has won three Best Actress Awards: Frances McDormand.

Twelve women have one two Best Actress Awards (this list of twelve is in addition to the two previously mentioned).  

If I'm reading that accurately, I wonder how many folks realize that Ms McDormand has more wins in this category than Meryl Streep?

Fossil Fuel Contracting -- Winners And Losers -- July 24, 2021

Mexico, oil production: link to S&P Global Platts --

  • private companies: hitting production records;
  • Pemex struggles (an understatement); twice revises production goals downward; this is much wrose than the headline would suggest

Norway: Exxon shuts down Norway Slagen refinery; link here

ExxonMobil has told Argus that its stopped operations at its 120,000 b/d Slagen refinery in Norway in June.

The company said in April that it would permanently shut the refinery over the summer, saying continued operation "is not economically viable over the long term" because of "strong competition, evolving regulatory measures, and falling demand."

Around 60pc of Slagen's products were exported. Its closure leaves state-controlled Equinor's 200,000 b/d Mongstad plant as Norway's only refinery.

Slagen is the fifth European refinery to halt completely since the Covid-19 pandemic, bringing the lost crude distillation capacity to more than 600,000 b/d.

TotalEnergies halted its 93,000 b/d Grandpuits refinery in France, and will convert it to process pure renewable fuels. Portugal's Galp and Finland's Neste have permanently stopped their respective 110,000 b/d Porto and 55,000 b/d Naantali refineries to focus on products imports.

Trading firm Gunvor has long-term mothballed its 115,000 b/d Antwerp refinery, and UK-Chinese Petroineos has done the same with one crude distillation unit (CDU) at the 210,000 b/d Grangemouth refinery. Gunvor has also permanently stopped both CDUs at its 80,000 b/d Europoort refinery in Rotterdam, though it continues to run secondary units.

Europe's refineries have for years been contending with competition from producers in the Middle East and Asia-Pacific, where capacity continues to grow rapidly, while local fuel demand growth slows.

Everything points to energy costs surging. And it won't be transitory. 

Global Warming And Energy Demand -- July 24, 2021

I seldom see this discussed in mainstream media.

This should have been posted some time ago; apparently it got lost in the shuffle.

Proterra Bus Update -- July 24, 2021

Updates

September 3, 2021: Minnesota update here.

Original Post 

Last week I posted the most under-reported story of the day: Philadelphia's Proterra fleet in complete shambles. It's an amazing story. The battery life was ridiculously short. The batteries were  so heavy that the frames failed. The cost is ridiculous.

Well, someone must be reading the blog. 

This past week, I think it was Friday, a reader sent me this story, again, from the Washington Free Beacon: Proterra bus fire prompts California agency to consider shelving electric bus fleet. 

I can't make this stuff up.

This comes just after GM recalls (for the second time, the same) 70,000 Chevy Bolts due to fires.

But back to Proterra.

From the linked article:

  • electric buses are melting in the sun;
  • too expensive to fixan electric bus manufactured by Proterra caught fire while charging in a southern California city that is now considering taking the electric buses off the road, according to government records;
  • the Foothill Transit agency, which serves the valleys surrounding Los Angeles, will decide on Friday whether costly Proterra buses purchased in the last decade are still operable. Problems cited by the agency include not only the bus that caught fire in what's described as a "thermal event," but also buses that melt in the California heat and have transmission failures. Roland Cordero, the agency's director of maintenance and vehicle technology, says the problems with the buses are exacerbated by Proterra's inability to help with repairs.

"Inability" or "unwillingness."

More:

"With the number of failures we are experiencing and the inability of Proterra to provide parts, these [Battery Electric Buses] BEBs will only get worse as we continue to operate them whenever the BEBs are available for service," Cordero wrote ahead of Friday's executive board meeting, where the agency will debate taking Proterra buses out of service.

The electric bus company, which has been hailed by the Biden administration as the future of mass transportation, has seen its stock plummet in the last month as reports pile up about problems with its product. In Philadelphia, mechanical failures and weak battery performance forced city officials to shelve buses received as recently as 2019. In Duluth, Minnesota, the buses were taken off the road because their brakes couldn't handle the city's hills. The publicly known failings of Proterra's buses have not deterred key members of the Biden administration, including the president himself, from touting the company on multiple occasions.

Proterra ticker symbol: PTRA.

On Friday, yesterday, PTRA fell another 4.46%.

One year performance:

  • apparently went public in November, 2020: closed about $10.
  • surged, with huge volume, mid-January, 2021: closed about $30
  • by March 5, 2021: slumped to $16
  • recent high: July 9, 2021 -- $17
  • yesterday, July 23, 2021: $11, on a day and a week when the market surged;

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

Whiting To Acquire 8,752 Acres In The Sanish; $271 Million -- Geoff Simon -- Whiting Press Release -- July 24, 2021

Updates

September 10, 2021: was Kraken the seller?

Original Post

Somehow I missed this one.

From Geoff Simon's top North Dakota energy stories this week:

Whiting Petroleum announced this week it has entered into an agreement with an undisclosed seller to acquire 8,752 net acres in Mountrail County for total cash consideration of $271 million. [Undisclosed seller in the Sanish. Slawson?]


To partially offset the cost of the transaction, Whiting plans to divest its Redtail oil and gas assets in Weld County, Colorado. The assets, which cover more than 67,000 acres with daily production of 7,100 barrels of oil equivalent, are being sold to a private entity for $187 million. 

The Bakken acreage includes 61 undrilled locations, five drilled but uncompleted (DUC) wells, and currently produces 4,200 BOE/day, of which 80% is oil. Company officials say there is significant upside from Whiting Petroleum’s existing operations in the Sanish field.

“These two transactions result in a significantly deeper drilling inventory in our key Sanish operating area, while divesting of properties in Colorado that were not going to compete internally for capital," said Whiting CEO Lynn A. Peterson. "These transactions demonstrate our strategy to focus our attention on value-enhancing opportunities that compete for capital in a $50 oil environment."


Peterson said the company estimates that in a mid-$50s oil environment, it has more than six years of high-quality drilling inventory, assuming a two-rig drilling program.

Whiting Corp press release.

 

$271 million / 8,752 net acres = $31,000 / acre. Figures rounded.


$187 million / 67,000 net acres = $2,800 / acre. Figures rounded.

 

8,752 acres / 640 acres = 14 sections.

 

8,752 acres / 1280-acre  units = 7 drilling units

 

61 undrilled locations / 7 drilling units = 9 additional wells in existing 1280-acre units;


Whiting is tracked here, although it is rarely updated. 


"Deals in the Bakken" are tracked at the sidebar at the right. 


Week 29: July 18, 2021 -- July 24, 2021

Best story of the week:  

Top story of the week:

Energy story of the year?

Least followed story of the week:

Top international non-energy story:

Top international energy story:

Top national non-energy story:

Top national energy story:

  • WTI finishes the week at $72;

Top North Dakota non-energy story:

Top North Dakota energy story:

Geoff Simon's top North Dakota energy stories:

Operators:

Operations:

Other formations in the Williston Basin:

Wells:

Fracking:

  • Long pole in the tent in the Bakken: frack crews;

Pipelines:

Refineries:

Bakken economy:

Random Photo -- For Future Reference -- Carman's Store, Keene, ND -- July 24, 2021

I assume this is the correct location; taken directly from the website. 

There are a number of landmarks on this map which make it interesting for future reference. 

Pad Fire North Of Keene, ND -- July 24, 2021

Because I did not want to incorrectly identify a pad fire at the wrong location (and the operator by association), I pulled the original post regarding that pad fire off the blog.

A reader sent me a note saying the rig in the photo is a workover rig and would not show up on the NDIC map as a drilling rig. 

I thought it was a workover rig at the time I posted the original note and should have not gone further with trying to locate the pad based on that error. It was a huge rookie mistake on my part.

So, the original post has been pulled. [To complete the story, a reader went by the pad I identified in the original post and said there was no fire and there had been no fire at that site. The reader suggested where the pad was likely to be, but I won't post that until / unless confirmed by other sources. But my hunch: the reader has it right; I was wrong.]

Here are the photos again taken "north of Keene" and posted on Facebook. Apparently the photos were taken about 10:37 p.m., Thursday night, July 22, 2021.

The photos:


I searched the local newspapers for any oil fires in this area. I couldn't find the story Thursday night. But  Friday night, via twitter, I found the story. 

The link is to The Bismarck Tribune (https://bismarcktribune.com/news/state-and-regional/crews-respond-to-fire-at-mckenzie-county-oil-well-site/article_c1f9e4be-5ec4-58c3-8a02-19f52622f290.html): the story may be behind a paywall but I was able to capture the story before I lost it:

The US Forest Service is monitroing an active fire on an oil well site just south of Lake Sakakawea in McKenzie County (and north of Keene, ND).

No injuries had been reported, according to a news release from the Dakota Prairie Grasslands office. The fire was contained to the well pad and no surface grassland or groundwater resources were affected Friday evening. Response teams are working to manage the incident.

The cause of the fire is under investigation.

More at the link.

So, we're at square one. The pad fire could be at any number of locations north of Keene, ND, and south of the lake.