Sunday, September 19, 2021

Notes From All Over -- Part 6 -- September 19, 2021

UK mess: UK energy firms seek bailout as government talks run on.  Sounds like the "Texas Freeze" but ... super-sized ... so much worse ...

Global mess: surging natural gas prices -- not just a UK story;

  • around the entire world;
  • link to The WSJ;
  • in the US, natural gas closed at $5.105; has doubled in the last six months; up 17% this month (so far);
  • last time prices this high: during the blizzards in the US northeast back in 2014;
  • analysts say that it might not have to get that cold this winter for prices to reach heights unknown during the shale era, which transformed the U.S. from a gas importer to supplier to the world.

Why Covid-19 remains the focus for Resident Biden:

  • my hunch is that the young Biden administration staffer thought the migrants crossing into Texas was funny until it wasn't;
  • link here;
  • only a matter of time before the Del Rio story becomes the "top story"; photo op if the 15,000 migrants start to "riot"

Notes From All Over -- Part 5 -- September 19, 2021

TCM: wow, wow, wow -- anything to avoid the NFL this afternoon, and TCM is airing Citizen Kane. Awesome. Enjoyed it again. Now, Doctor Zhivago. That's perhaps the only movie I can no longer watch. It is simply too painful for me to watch. There way too many "personal connections" with which I can connect, including the fact our older daughter spent a summer in Russia on her own during her college years. Watching the lead-in by TCM, I may have to re-read the novel. Oh, how cool is this? In between the movies, the five presenters answer the question, which one movie "lifts them up"? Ben Mankiewicz: Casablanca. I would have to agree.

Another week of swimming. Tuesday looks a bit cloudy ... but, other than that ..

Shortages? What shortages? Amazon is simply amazing. I arrived back home Friday night. My wife mentioned that some fluorescent lights in the kitchen had burned out and we needed to put in a work order to have the lights replaced. Instead, I ordered a six-pack of lights for $12 from Amazon. The lights arrived today, Sunday, less than 48 hours later. Lights replaced; wife happy. I hate "nickel and diming" our manager -- had we lived in our own house, it would have been the same -- it cost me $4. 

NFL: Dallas wins; Chiefs lose. “Every” analyst said the Baltimore Ravens would lose to the Kansas City Chiefs. On a separate note, NFL embraced gambling as soon as SCOTUS made it legal.

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New Earrings

The Magnitude Of Natural Gas Reserves In The US -- September 19, 2021

Disclaimer: I often make simple arithmetic errors and often misread things. If this is important to you, go to the source. 

Re-posting.

From a reader who follows the Appalachia, Marcellus, Utica, very, very closely -- 

The well: the Deremer 2HC, 3,617,694 boe  / 22 months on line -- the "Mighty Marcellus' best! 
Succinctly, I present you with data, with some context - current to July, 2021 - of the very best Marcellus well.
 
This in an effort to show the scale of what has been unfolding in the Appalachian Basin ...

Numbers:
  • 20,982,624,000 (just shy of 21 billion) cubic feet production (3,627,694 boe using 5.8 conversion factor)
  • 658 days online (~22 months)
  • July output 18,291 million cubic feet per day, oil energy equivalent of 3,153 barrels per day 
  • currently ranked #7 all time producer, on track to be #1 in a few months
Context:

     This one well can provide the annual residential gas needs for the cities of Cincinnati, Pittsburgh, and Buffalo COMBINED. (75,000 cubic feet per  household/year ... 3 persons/household)

The 5 wells on this Deremer pad all came online 22 months ago and have cumulatively produced 70 billion cubic feet ... enough to supply the annual residential gas needs of Philadelphia, Boston and Atlanta COMBINED

At a cost to drill and complete of approximately $50 million, this pad shows the incredible potential to any and all who continue to disparage embracing the  hydrocarbon bounty that lies beneath our feet.

Population / costs:

  • the cities:
    • Boston: 700,000
    • Philadelphia: 1.6 million
    • Atlanta: 500,000
  • population total: 2.8 million
  • one year to drill / complete the wells: $50 million
  • $50 million / 2.8 million = $18 / resident / year -- assuming these wells produce for only one year, which, of course, is not the case. 

By the way, this is why the EU has worked so hard to convince Americans of global warming. The gap between the energy available in the US and the EU is absolutely incredible. The EU desperately needs to keep the US from gapping ahead of the EU. The EU will do anything to make US energy costs equal to that of the EU. 

Notes From All Over -- Part 4 -- The Home Mortgage Edition -- September 19, 2021

Link here.

Small and midsize metros with the highest loan approval rates.

Small metros:

  1. Iowa City, IA
  2. La Crosse, WI
  3. Fargo, ND
  4. Bismarck, ND
  5. Sioux Falls, SD

Midsize metros:

  1. Madison, WI
  2. Des Moines, IA
  3. Provo, US
  4. Boise City, ID

Large metros with highest loan approval rates:

  1. Minneapolis, MN
  2. St Louis, MO
  3. Portland, OR
  4. Salt Lake City, UT
  5. Kansas City, MO
  6. Seattle, WA

In other words, fly-over country.

Notes From All Over -- Part 3 -- The Natural Gas Edition -- September 19, 2021

Updates

September 19, 2021:

From a reader who follows the Appalachia, Marcellus, Utica, very, very closely --  

    The well: the Deremer 2HC, 3,617,694 boe  / 22 months on line -- the "Mighty Marcellus' best! 

        Succinctly, I present you with data, with some context - current to July, 2021 - of the very best                Marcellus well.
 
        This in an effort to show the scale of what has been unfolding in the Appalachian Basin ...
       
        Numbers
:
  • 220,982,624,000 (just shy of 21 billion) cubic feet production (3,627,694 boe using 5.8 conversion factor)
  • 658 days online (~22 months)
  • July output 18,291 million cubic feet per day, oil energy equivalent of 3,153 barrels per day 
  • currently ranked #7 all time producer, on track to be #1 in a few months
Context:

     This one well can provide the annual residential gas needs for the cities of Cincinnati, Pittsburgh, and Buffalo COMBINED. (75,000 cubic feet per  household/year ... 3 persons/household)

The 5 wells on this Deremer pad all came online 22 months ago and have cumulatively produced 70 billion cubic feet ... enough to supply the annual residential gas needs of Philadelphia, Boston and Atlanta COMBINED

At a cost to drill and complete of approximately $50 million, this pad shows the incredible potential to any and all who continue to disparage embracing the  hydrocarbon bounty that lies beneath our feet.

Population / costs:

  • the cities:
    • Boston: 700,000
    • Philadelphia: 1.6 million
    • Atlanta: 500,000
  • population total: 2.8 million
  • one year to drill / complete the wells: $50 million
  • $50 million / 2.8 million = $18 / resident / year -- assuming these wells produce for only one year, which, of course, is not the case. 
By the way, this is why the EU has worked so hard to convince Americans of global warming. The gap between the energy available in the US and the EU is absolutely incredible. The EU desperately needs to keep the US from gapping ahead of the EU. The EU will do anything to make US energy costs equal to that of the EU. 

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Original Post 

Link here.

UK/ Europe: US manufacturer CF Industries and Norwegian chemical producer Yara International ASA announced closure of their facilities due to extraordinarily high European natural gas prices.

UK Steel: will close some steel plants across the UK due to high energy prices.

Freeport LNG, Texas: remained without power Friday; unclear when the plant might return to service.

Cheniere Energy, Inc: asked for FERC approval for a sixth train at Sabine Pass LNG in Louisiana. Approval was requested by Tuesday, September 21, 2021 (good luck with a Dem-dominated FERC). Train 6 is expected to be complete in 1Q22. 

Predictions: I don't know if folks recall but only a few years ago, "everyone" was predicting a natural gas shortage in the US and these export terminals were being proposed as import terminals. Then... the Bakken revolution. From twitter:

O&G on Twitter: "In the early 2000s the O&G industry warned everyone that the US would run out of natural gas in 10-15yrs. Those forecasts were spectacularly wrong. Green energy forecasts will also be spectacularly wrong Nobody has a monopoly on being wrong on long-term forecasts." / Twitter

By the way, that was about the time, the experts saw the need for the Keystone XL: ultimately killed by .. Resident Biden. Will we see $150-WTI due to this bone-headed decision?

Bloomberg: winter is coming and Europe is running scarily low on natural gas. Bloomberg used the word "scarily." I used the word "unnerving" earlier this week. I like "unnerving" better.  

NY Times: shutdown of fertilizer plants puts British meat supply at risk. Link here. I can't imagine this happening overnight but it may surprise me. This is the problem:

... carbon dioxide is used to stun animals like pigs and chickens before they are slaughtered, under regulations intended to protect animal welfare. The gas is also injected into meat packaging to extnd the shelf life in supermarkets.

Once current stocks of carbon dioxide run out -- less than fourteen days are left -- some companies would need to "stop taking animals and close production lines."

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How Bad Has It Been In The Bakken

From NaturalGasIntel:

The “number of well completions has been low and volatile since April 2020,” Helms said. The number of active completion crews declined “from 25 to one, then increased to six in July and to 12” as of Friday. 

With all due respect to Art Berman, the long pole in the tent in the Bakken is not the number of active rigs, but the number of frack spreads. One can drill wells -- at the rate of one well every six days for each rig -- until the cows come home, as they say, but without fracking them, they are simply DUCs. And, oh, by the way, all things being equal, fracking generally slows down in the cruel months of January and February in North Dakota.

The big question, unanswered, is whether operators are able / not able to get the frack spreads they want.

Notes From All Over -- Part 2 -- September 19, 2021

UK energy crisis: wow, this is getting serious. Link to UK panic here. Again, you will hit a paywall, but can easily get past the paywall on an iPhone or an iPad with IOS 13. One more reason to love Apple.

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 

Ford: adding 450 jobs to double production of its F-150 Lightning electric truck. The truck has not even hit the market yet, but has already received 150,000 reservations. The company plans to double manufacturing production to 80,000 trucks/year. Link here.

My favorite graph: the data is updated at the end of each month but takes a week or so to get published. It takes time; it's a lot of data. To the best of my knowledge, we only have data current as of July 31, 2021. We should be getting August 31, 2021, data soon; it may be already out but I haven't seen it. I see there is an August report but it still only covers data through the end of July, 2021.

On Friday, September 17, 2021, Reuters reported that "US money market funds saw the biggest weekly outflow in nine months." Link here.

  • U.S. money market funds saw an outflow of $43.34 billion in the week to Wednesday, the largest since December 16, 2020;
  • so, we're talking about the week from Thursday, September 9, 2021, to Wednesday, September 15?
  • what would people be doing, taking all that money out of money market funds? Buying used cars? Buying real estate? Paying for college?
  • the core measure of U.S. consumer prices edged up 0.1% last month, the smallest gain since February, 2021. The August slowdown gives the Federal Reserve breathing room as it prepares to reduce its massive bond holdings and decide how soon to begin lifting rates from near zero to not-so-near zero;
  • meanwhile, U.S. equity funds attracted a net $5.54 billion after seeing outflows worth $1.83 billion in the previous week
  • U.S. equity value (dividend-paying companies) funds lured a net $1.28 billion, and growth funds received a net $208 million, after each saw an outflow in the previous week.

Fox Business also noted that investors "were swapping cash for stocks in 'rapid frenzy' ahead of the Fed meeting this next week (https://www.foxbusiness.com/markets/investors-swap-cash-stocks-rapid-frenzy-ahead-fed-meeting). In that report, Fox breathlessly reported;

  • investors pulled nearly $62 billion from cash accounts this week
  • of that, $51 billion into equities; $16 billion into bonds
  • a record $28 billion into US large-cap stock funds; tech stocks saw a week of inflows that has seen $3.2 trillion enter the space;
  • investors "existed cash at the fastest pace in more than a year and poured money into stocks" -- and yet the market has been down for several consecutive days lately;
  • this was a "monster reallocation cash-to-stocks as tax redistribution threat recedes and the Fed is expected to remain Wall Street friendly
  • remember: Jay Powell is more concerned with unemployment than with inflation;
  • the benchmark S&P 500:
    • has gained 185 this year;
    • has gone 377 days without a 10% pullback, the longest stretch since February, 2016, to February, 2018;

By the way, what was the August 18, 2021, report? Link here.

  • from June 30, 2021 to July 30, 2021: mmf assets decreased by $18 billion -- that was a full month -- $18 billion over one month; then in one week, last week, outflows were over $43 billion

Let's look at that graph above;

  • $5 trillion to $4.8 trillion: $200 billion.

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

I don't think Jim Cramer mentioned any of this. He's looking for a sizable correction in September.

Initial Production For Wells Coming Off The Confidential List This Next Week -- September 19, 2021

The wells:

  • 37029, conf, Enerplus, Fiddle 149-94-02C-01H-TF, Mandaree, the "String Instrument" pad is tracked here:
DateOil RunsMCF Sold
7-20214093447735
6-20215091058674
5-20215326858213
4-20214284331028
3-20211710411787
  • 37028, conf, Enerplus, Mandolin 149-94-02-01H, Mandaree, producing, the "String Instrument" pad is tracked here:
DateOil RunsMCF Sold
7-2021770
6-2021410
4-20213841727851
3-2021129558926
  • 38181, conf, Petro-Hunt, Hurinenko 144-98-2B-11-1HS, Little Knife, early production

DateOil RunsMCF Sold
7-202116981582
  • 37245, conf, MRO, Armstrong 14-34H, Bailey, no production data, 2560-acre spacing unit;
  • 38153, conf, CLR, Candee 12-9HSL, Chimney Butte, no production data, 
  • 38154, conf, CLR, Candee 12-9HSL1, Chimney Butte, no production data,

A Handful Of Wells Coming Off The Confidential List This Week -- September 19, 2021

Monday, September 27, 2021: 31 for the month, 42 for the quarter, 222 for the year:

  • 37029, conf, Enerplus, Fiddle 149-94-02C-01H-TF,
  • 37028, conf, Enerplus, Mandolin 149-94-02-01H,

Sunday, September 26, 2021: 29 for the month, 40 for the quarter, 220 for the year:

  • 38181, conf, Petro-Hutnt, Hurinenko 144-98-2B-11-1HS,
  • 37245, conf, MRO, Armstrong 14-34H,

Saturday, September 25, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • None.

Friday, September 24, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • None.

Thursday, September 23, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • None.

Wednesday, September 22, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • None.

Tuesday, September 21, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • None.

Monday, September 20, 2021: 27 for the month, 38 for the quarter, 218 for the year:

  • 38153, conf, CLR, Candee 12-9HSL,
Sunday, September 19, 2021: 26 for the month, 37 for the quarter, 217 for the year:
  • 38154, conf, CLR, Candee 12-9HSL1,
Saturday, September 18, 2021: 25 for the month, 36 for the quarter, 216 for the year:
  • None.

Notes From All Over -- Part 1 -- September 19, 2021

NASCAR: last night -- an incredibly good race. Short track. Bristol. Kevin Harvick made it to the round of twelve, but just barely. Harvick has had no wins, no poles this season. Alec Almirola, one win this season, did not advance; nor did Kurt Busch who also had one win this season.

Paywalls: a thing of the past. Happened to find "the holy grail" of getting past paywalls while scrolling through social media tweets. So far it's worked 100% of the time. Works on iPhone and iPad but not the laptop but that's more than good enough for me. Wow. 

Covid-19: this remains a fascinating story. The real question is why so many people don't get it. Going through that SEA-TAC airport late last week -- the place much have been swarming with particles, and -- knock on wood -- I'm still symptom-free. My older daughter and their three daughters never caught Covid despite their dad getting a fairly severe case, test-positive, with long-haul neurological symptoms which seem to have resolved. 

Boosters: I'm surprised folks seem to be surprised that boosters and/or multiple doses are needed. Isn't that pretty much the norm for vaccinations? Even the incredible "tetanus" shot -- for a toxin that does not mutate -- requires a booster every ten years. Have you had yours? Years ago, I saw a case of tetanus during training at USC - LA County -- it wasn't a pleasant sight. A 50-ish year-old woman contracted tetanus through a lesion on her upper chest while gardening. I do believe she survived but it wasn't pretty.

Ivermectin: for those concerned about a medicine used to treat horses, those same folks may want to take a look at a life-saving medication for humans that was first developed as a rat poison, namely warfarin (Coumadin). Whereas, coumadin was developed to kill rats first, and then approved to treat humans, the opposite was true for ivermectin: developed specifically for humans (Nobel Prize) and then later approved for treatment of horses. Over at Schwa Nation: three items of note:

  • a North Dakota veterinarian was a key participant in the development of warfarin
  • warfarin was first registered for use as a rodenticide (rat poison) in the US in 1948, and was immediately popular; and,
  • WARF: Wisconsin Alumni Research Foundation; -arin, for its link to coumarin.

Approved for medical use in humans in 1954, an early recipient of warfarin was President Dwight Eisenhower, 1955, after suffering a massive heart attack. The exact mechanism was unknown, and, of course, long term side effects were also unknown, but Eisenhower's use kicked off the frenzy for warfarin prescribing. Again, a rat poison. A huge thank you to a reader for sending me this. I had long forgotten. I wonder if President Eisenhower knew it was "rat poison" at the time, and if he had to sign an "informed consent" statement.

Some years ago, I saw a rat die after ingesting warfarin (rat poison) and the agony seen was unbearable for me to watch. And I hate rats.

Oh, by the way, North Dakota played a key role in understanding avian flu (corona viruses) also many decades ago.

By the way, I wonder how many deaths have been attributed to Coumadin over the years?

College football: 100,000+ stadiums filled to capacity; no one wearing masks; no reports of outbreaks. 

NFL football: not one match-up interests me though I may tune into the Dallas game for a few minutes. Now that gambling is legal, I think posting the odds along with the schedule would encourage folks to watch. At least a little. Maybe. No. Law was overturned by US Supreme Court in 2018 (?) and the NFL now "embraces" legalized sports bettering -- according to CNBC

Wow, slow news day. Great day for reading.