The Million Dollar Way (The Bakken Oil Blog): 09/10/21

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.

Link here.

As an example let’s compare the cash generation between Occidental Petroleum, (NYSE: OXY) and NextEra Energy, (NYSE: NEE). One company produces oil and gas primarily, and the other participates in the “Green Energy” sector building windmill farms for electricity generation.

Investors in NextEra are looking past a mountain of debt to award the company a capitalization of $168 bn at the current share price of ~$85. Some of this is understandable given the figurative, “wind at the back,” of this industry. Windfarms could be the “tulip craze” of the modern era, and are endorsed and sanctioned by local, state, and the Federal government. However, if dividend security is analyzed using conventional metrics in the table above, investors in OXY should be sleeping much better at night, than those holding shares of NEE.

At some point, investors in NEE may have to come to grips with the fact that as attractive as this sector is socially, it is not generating returns sufficient to maintain generous dividends being offered.

Devon:

Another company, Devon Energy, has already begun returning capital to shareholders in the form of an innovative dividend policy and share repurchases. Jeff Ritenour, CFO of DVN commented in their recent analyst call about capital allocation-

“I would say the share repurchases is certainly moving up the list of options for us, potential options for us as we move through the back half of this year. We could absolutely supplement it with some incremental variable dividends and potentially some incremental share repurchases. I think the other thing we'll look at as we get further into the year and probably into 2022 is the potential to increase the fixed dividend as well.”

DVN’s newly implemented dividend policy includes a modest regular dividend of $0.44 per share combined with a special dividend that constitutes a plan to return as much as 50% of excess cash to investors.

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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Paddle Boarding -- Grapevine Lake, DFW, North Texas
Sophia and Her Mom

Gasoline Demand -- Update -- September 10, 2021

Gasoline demand: creeping up.

Is anyone paying attention?

One can argue whether "we're back to normal" (Covid-19). I don't think we are, but yet, gasoline demand hit an all-time record earlier this year. Current gasoline demand continues to flirt with record demand for this time of year.

We actually went over ten million bbls earlier this summer. Link here.

The tea leaves suggest "we" will push through 10.5 million bbls per day next summer (2022).

College Football: UND At Utah State -- UND Is A 6-Point Underdog -- CBS-Sports Network -- 8:35 P.M. CT (Weather Delay) -- September 10, 2021

Maybe more later.

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Racing

In lieu of NASCAR racing tonight, the twins:

The twins, eighteen months old, on their balance bikes.

NFL Opener -- Highest Number Of Viewers Since 2015 -- Dallas Vs Buccaneers -- September 10, 2021

Before we get to last night, look at this. From September 6, 2021:

I do not know if there is any update or news regarding the July, 2021, story that Apple was in talks to acquire streaming rights to the "Sunday Ticket. Previously posted. But this is the app:

I track the "streaming wars" here. Apple was said to be looking at bidding for the NFL Sunday Ticket.

And I've said for quite some time, it will be Amazon vs Apple before it's all over.

And now the NFL Sunday Ticket. From CNBC earlier today, "Amazon likely front-runner for multiyear NFL Sunday Ticket."

The NFL is expected to ask for $2 billion to $2.5 billion per year for the package and wants to wrap up discussions before the season ends in February.

“Sunday Ticket” has been owned by DirecTV for the past 27 years.

DirecTV, which AT&T spun out as a new company last month, renewed “Sunday Ticket” in 2014 for eight years. The current contract ends after the 2022-23 season.

Amazon has a serious interest in the multiyear package of out-of-market games.

Amazon in May agreed to pay about $1 billion per year to become the exclusive provider of Thursday Night Football games beginning next year. That deal made Amazon Prime Video the first-ever streaming service to own an exclusive NFL broadcast package.

NBCUniversal’s Peacock isn’t expected to be a serious competitor for the rights, a source said.

Apple is not having a good week.

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Last Night -- The Opener

Link here.

The NFL came into kickoff weekend looking for increased audiences over last season. After one game, the league is off to a strong start with the most-watched opener in six years.

Thursday night’s 31-29 victory by the Tampa Bay Buccaneers over the Dallas Cowboys averaged approximately 26 million viewers on NBC, Peacock and the NFL’s digital platforms according to preliminary data from Nielsen and Adobe Analytics.

It is a 20% increase over last year’s game between the Kansas City Chiefs and Houston Texas and the largest audience for an NFL opener since the Pittsburgh Steelers-New England Patriots game in 2015 averaged 27.4 million.

Of course, the 2020 season was played during the pandemic, with empty stadiums presenting a strange viewing dynamic, and many people’s viewing habits changing.

The average of 24.4 million viewers on NBC makes it television’s most-watched show since February’s Super Bowl on CBS. The audience peaked at 25.4 million between 9:45-10 p.m. ET.

Even though the league’s new television deal doesn’t officially kick in until 2023, some elements are taking effect this season, including Week 1 doubleheaders on both CBS and Fox. The featured 4:25 p.m. ET games will be Cleveland at Kansas City on CBS and Green Bay facing New Orleans in Jacksonville on Fox. The game was moved out of New Orleans due to Louisiana still recovering from Hurricane Ida.

The league has allowed doubleheaders on both CBS and Fox during the final week of the regular season. That means both networks will have 10 doubleheader weeks as the league expands to 17 games over 18 weeks for the first time.

Much more at the link.

Covid is so over.

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From Breitbart News

Transitory inflation:

Putting food on the kitchen table has become much more expensive, squeezing household budgets at a time when many families are already stressed by the Delta variant surge hitting as kids go back to school. Food prices rose a full percentage point in August, up from six-tenths of a point in July, defying predictions that inflation would cool off, data from the Bureau of Labor Statistics showed Friday.

Compared with a year ago, food prices are up 12.7 percent, outpacing the overall increase of 8.3 percent in the Producer Price Index.

On an annual basis, that is the highest level of food inflation in records that go back to 2010. The monthly figure is the third-highest on record, following May 2020’s pantry-raid that emptied many grocery store shelves and February 2011.

The Whiting $271 Million Sanish Deal -- Update -- September 10, 2021

See this note.

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?]

A reader was kind enough to send a copy of Whiting's "Summer 2021" corporate presentation. In that presentation: a "map" of the "bolt-on addition." My earlier thoughts, the seller might have been Slawson. That's still possible but looking at Whiting's presentation and comparing data presented to the NDIC map suggests that the seller may have been Kraken.

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Cool Kitchen Gadget

Notes From All Over -- Part 2 -- September 9, 2021

Gasoline demand: creeping up.

Covid-19: let's add this to the database of information "known" about Covid-19. Those who came down with the "natural" Covid-19 disease and subsequently got an mRNA vaccine against Covid-19, appear to be really, really, really immune to subsequent infections. Link here.

If they do suffer a break-through infection, I wonder if ivermectin might help? Whether or not this is actually true -- that an mRNA vaccine preceded by the "natural" illness confers super-human immunity -- does not matter. It's simply another talking point for the government to use to explain why biotech companies recommend the vaccine even if one has already had the disease.

Teen boys: at higher risk for complications from the vaccine. Link here.

Daily Activity Report Pending -- September 10, 2021

Active rigs*, from the NDIC's daily activity report:

$69.72	9/10/2021	09/10/2020	09/10/2019	09/10/2018	09/10/2017
Active Rigs	26*	12	64	66	55

Active rigs:

CLR: nine
Hess: three

Five new permits, #38553 - #38557, inclusive:

Operator: Crescent Point Energy
Field: Dublin (Williams County)
Comments:

Crescent Point Energy has permits for five CPEUSC Pankake wells, to be sited in section SWSE 31-158-99;
the wells will be sited 360 FSL and between 2335 FEL and 2435 FEL;

One well released from the confidential list:

37885, conf, Crescent Point Energy, CPEUSC Sylven 3-11-2-158N-100W-MBH, Winner, the NDIC has the scout ticket as conf;

One producing well (a DUC) was reported as completed:

37511, 2,374, Hess, EN-Vachal LLLP-LE-154-94-2029H-2, Alkali Creek, the NDIC still has the scout ticket showing the well as drl/NC; production:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	7-2021	31	8723	8778	7451	1973	1760	213
BAKKEN	6-2021	30	9369	9466	8051	21146	20992	154
BAKKEN	5-2021	28	5950	5942	8601	22927	22737	190
BAKKEN	4-2021	30	17099	17043	10292	30903	30543	360
BAKKEN	3-2021	31	25301	25328	11376	27245	26592	653
BAKKEN	2-2021	26	30523	31118	15570	39227	27579	11648
BAKKEN	1-2021	10	6878	6097	1733	8704	8084	620

Notes From All Over -- Part 1 -- September 10, 2021

Fossil fuel headlines:

WTI: up 2.5%; up $1.68; trading at $69.82
natural gas: down a bit, trading at $4.961
"oil prices bounce back as bullish sentiment returns"; link to Tom Kool; aka PeeWeeHerman;
protests break out in Europe as electricity prices soar; link to Charles Kennedy; I have no sympathy; they've been going "green" for the past decade;
California looks to burn more fossil fuel to avert blackouts; soaring electricity prices; I have no sympathy; they've been going "green" for the past decade; also at OilPrice.

Covid Is So Yesterday -- September 10, 2021

Link here.

Covid is so over.

Hurricane Ida:

formed: August 26, 2021
dissipated: September 4, 2021

Data below is for week ending September 3, 2021, literally the "week of Hurricane Ida."

Jet fuel: self-explanatory.

Motor gasoline: this suggests to me that gasoline demand tends to be pretty "static." Whether it's "good times" or "bad times"; whether the economy is doing well or not, gasoline demand tends to remain fairly static.

Distillate: proxy for strength of the US economy?

Picks And Pans -- Sports, Market -- September 10, 2021

Updates

Later, 2:02 p.m. CT: I flip-flop so much, I make John Kerry look like St Peter, the Rock. LOL. I mentioned below that I only watched the first half of last night's NFL TNF, and had no plans to watch any more NFL this year. Well, I'm re-thinking that. I may watch the Tampa Bay Buccaneers, and a few plays in any game in which Dallas is playing. A reader sent me this.

Original Post

Everyone loves a comeback:

great, great opener; Tom Brady vs Dallas Cowboys
Dak Prescott set all kinds of records
a three-point loss

but, at the end of the day, a loss is a loss -- no matter how close

did we just see the best game of the season?
I watched the first half, then turned it off

I don't plan to watch any more NFL this year; I don't think there can possibly be a better game; oh, I'll surf through the games on Sunday, Monday, and Thursday, but won't watch much

review: USA Today, the day after;
review: USA Today, Brady pulls off ugly win (hey, guys, a win is a win is a win)

NASCAR this weekend:

we're in the playoffs
second of three: 16 in the race
junior league: Richmond, tomorrow, 1:30 p.m, CT, NBCS
varsity: Richmond, tomorrow, 6:30 p.m. CT, NBCS

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.

ENB: after SRE, the stock I love to follow most -- ENB

it's been in a trading range, like, forever
broke out above $40 earlier this morning, but has now been beat back to $39.83
pays 6.55%
"Enbridge bags a whale." Lost behind a paywall, but the headline says it all;
Line 3 should be flowing by the end of the month (September, 2021)
at 620,000 bpd, Line 3 competes with what Keystone XL would have been had Resident Biden not killed it;
620,000 bpd is a doubling of capacity; will be phased in; initial capacity: 350,000 bpd
ENB's 6.7% yield looks sustainable; The Motley Fool;
change in FERC widens the moat for companies like ENB, and WMB

TTE: another company I like to follow

Zacks Equity Research: which is the better value stock (September 6, 2021): TTE or CWEN?
Zacks:
TTE: buy
CWEN: hold

AAPL:

why Resident Biden can't fix the semiconductor shortage problem;
AppleWatch software chief moves to head the Apple Car project;
Apple Car project? Apple will go it alone; my hunch: wrong; it's in the definition, "alone."

Port congestion, link here: not going away any time soon

graphic looks scary

Walmart: will end quarterly bonus

"everyone"gets an hourly pay raise. Link to The WSJ.

What a waste:

The Flash actor Logan Williams, just shy of his 17th birthday -- dies of accidental drug overdose.

Costco:

I hate clickbait and this post is nothing but clickbait, but it's kind of fun, and not that hard to navigate: the big brands behind Costco's Kirkland label;
bottom line: Kirkland is a hidden gem; you will never go wrong
buy one "container" of the original, then after that fill the original "container" with the Costco Kirkland brand. LOL

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.

AAPL: for the archives. Dropped at least 2.5% today. From $155 to $150 this week. May get worse before it gets better. Buying opportunity.

A Great Day Of Blogging But Delayed A Bit -- September 10, 2021

Bakken economy: Fargo

Amazon says first day of operations new warehouse in Fargo will be September 19, 2021

Energy:

Great article for the archives: Big Oil risks insolvency.

WTI: up 2.22%; up $1.51; trading at $69.65

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Back to the Bakken

Active rigs*: accurate data at COB.

$69.65	9/10/2021	09/10/2020	09/10/2019	09/10/2018	09/10/2017
Active Rigs	26*	12	64	66	55

No wells coming off confidential list according to NDIC.

RBN Energy: global natural gas / LNG supply squeeze sets stage for record winter prices.

Global natural gas and LNG prices have spent the summer going from high to higher to the highest on record. The major European indices hit post-2008, and then all-time highs multiple times throughout the summer — even surpassing Asian prices on a handful of days. At the same time, Asian prices have set all-time seasonal records and are now sitting just below the previous single-day high settle from this past January. Usually, as the weather cools heading into fall, so do prices, but that’s unlikely this year as the European gas storage inventory is at the lowest level for this time of year than we’ve seen in recent history, and the time to replenish stocks for the winter is rapidly running out.

The incredible bull run for global gas prices has been underpinned by high demand for LNG and the cascading effect of a supply squeeze in Europe, brought on by the triple threat of low domestic production, decreased imports from Russia, and a scarcity of incremental LNG cargoes. Not only is this driving record-high gas prices and increased volatility now, but the low inventory means sustained high prices for the heating season ahead. In today’s blog, we take a look at recent global gas price trends and the precarious European storage situation ahead of what is shaping up to be an incredibly bullish winter.

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Friday, September 10, 2021