Wednesday, September 29, 2021

ISO NE -- What's Going On? -- September 29, 2021

10:44 p.m. EDT -- posts / screen shots. The actual data lags about one hour.

Electricity rates just spiked on the east coast.

Link to ISO NE.

In the past hour or so, real-time rates have moved from $70/MWh to over $105 / MWh.

For newbies:

  • $20 / MWh: when demand is low; renewable energy supplying max available
  • $30 / MWh: pretty normal expectation
  • $70 / MWh: very high rates
  • $100 / MWh: expect to see this with high a/c demand; high heating demand
  • $200 / MWh: rarely seen

Fuel mix chart:

  • for some reason percent of demand met by natural gas has dropped way off and expensive Canadian hydroelectricity is surging:
  • natural gas: 53%
  • nuclear: 29%
  • 11% hydro
  • renewables: 6%

Holy mackerel: a refresh shows real-time costs have spiked to over $200/MWh. 10:51 p.m. EDT. This is autumn; not hot summer weather and not cold winter weather, and yet coming on midnight, electric rates are surging.

Folks think charging EVs overnight will not be that big a deal.

Graphics:


 
 
Note: the screenshots were taken at the time indicated but the actual / real-time data was one hour earlier, at 9:50 p.m. EDT. 

The original graph below had to be redrawn to more than double the "y" axis to capture the $200+ spike in MWh price.

Later: rates quickly dropped to $100 / MWh after the above screenshot. A reader follows this much more closely than I do and probably has a good explanation. The thing I'm trying to point out is the overnight charging of EVs is going to be a bigger deal than most folks realize. EV penetration in New England is negligible.

MRO Taking Nice Wells Off Line In Antelope-Sanish -- September 29, 2021

MRO has taken several wells on the MRO Chauncey-Winona pad off line. These wells are tracked here

Interestingly, several MRO wells on another pad south of these wells have also come off line. For example:

  • 18471, 380, MRO, Hunts Along USA 12-1H, Antelope-Sanish, t1/11; cum 255K 7/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
SANISH7-2021116446153711215112530
SANISH6-20213017401700132026422702194
SANISH5-20213117321719142128122414180
SANISH4-20213016831722196425961851562
SANISH3-202131113010701743118688219

There's a lot of activity in this area -- existing, producing wells -- but I don't see any "new" activity on the GIS map. Unfortunately, NDIC is not updating scout tickets or the map in a timely matter, so hard to find additional information.

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Halloween, 2021

Grandson planning to go out as a "Trump Supporter" on Halloween.

Covid-19: For The Archives -- September 29, 2021

 






MRO: Damn The Torpedoes! Full Speed Ahead! Five More Permits In The Prolific Bailey -- September 29, 2021

NFL

  • ratings: link here.
    • huge ratings: the best start for the league since 2016, which analysts attribute in part to the easing of the pandemic and other factors.
  • Brady: he really, really made the right decision to come back "one more" season
    • Brady's statistics: insane; link here;
    • Brady to return to "his" arena; this Sunday; can't-miss TV; link here;

Enbridge: to start new Line 3 over the weekend. Link to Charles Kennedy.

Gasoline demand, link here. In the US, continues to fall.

Market: I'm not watching CNBC very much this week; not watching the market in the big scheme of things. Having said that, some ticker symbols today;

  • ENB: up a penny; $39.82; had been as high as $40.16 today; pays 6.7%;
  • DVN: up 1.76%; up 62 cents; closed at $35.75; as high as $36.04 intra-day; pays 1.23%;
  • EPD: up 0.46%; up 10 cents; closed at its high, $21.88; pays 8.23%;
  • MNRL: in the red; closed down 8 cents; closed at $19.52; pays 2.87%;

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Back to the Bakken

Active rigs:

$74.83
9/29/202109/29/202009/29/201909/29/201809/29/2017
Active Rigs2511576758

Six new permits, #38589 - #38594, inclusive:

  • Operators: MRO (5); Summit Carbon Solutions, LLC
  • Fields: Bailey (Dunn); Wildcat (Mercer County)
  • Comments:
    • first time I've seen Summit Carbon Solutions; Milton Flemmer 1, NWNE 35-141-88;
    • MRO with permits for five more wells in the prolific Bailey oil field; NENE 18-146-93; 563 FNL and between 336 FEL and 496 FEL; Amos, Cheryl, Stone, Killion, Weekes,
      • existing wells in that drilling unit:
        • 16923, 279, MRO, Appledoorn 14-19H, Bailey, t5/08; cum 360K 7/21;
        • 19408, 813, MRO, Trinka 41-18H, Bailey, t3/11; cum 194K 7/21;
        • 24219, 1,327, MRO, Appledoorn 34-19H, Bailey, t6/13; cum 252K 7/21;

Seven permits renewed:

  • EOG (3): three Austin permits in Mountrail County
  • QEP (2): two MHA permits in Dunn County
  • BR (2): two permits in Dunn County; a Manchester permit and a Concord permit;

One permit canceled:

  • EOG: #34118, Burke 94-1821H, Mountrail County

Name changes of interest:

  • CLR changes the name of three "LCU Ralph Federal" wells to LCU Ralph wells, dropping the "Federal."

The Dead Cow Keeps Growing -- September 29, 2021

Link to Rystad Energy.

I never saw this coming.

Dead Cow.

Vaca Muerta. 

The Vaca Muerta is tracked here.

The world's fastest growing shale play keeps breaking records. 

So, let's run the numbers.

  • Permian: 5 million bopd.
  • Bakken: 1 million bopd
    • 24 rigs.
  • Vaca Muerta:
    • prior to December, 2020, never exceeded 120,000 bopd
    • oil rigs: 50
    • July, 2021: 160,000 bopd for the first time ever
    • August, 2021: 161,000 bopd
    • forecast: 200,000 by year end, 2021
    • Argentina's total production:
    • forecast to hit 560,00 bopd by December, 2021
    • a benchmark not seen since October, 2012;

So, the Bakken:

  • four times as much oil with half the number of rigs.

More at the link.

Notes From All Over -- Part 1 -- For The Archives -- Nothing About The Bakken -- September 29, 2021

UK: another three UK electricity and gas retailers go bust (Igloo, Symbio, and Enstroga). In total, almost 1.75 million households have seen their energy retailer collapse in less than two months. Ten companies have failed so far. No sympathy. Folks tried buying into a deal that seemed too good to be true. It was.

SRE: huge volatility past two days. Up 3.06% today; up $3.87 today; this $124-stock is trading at $127.47, paying 3.45%.

Two-buck chuck: soon to become "three-buck chuck" but it will only be transitory.

Dollar Tree Store: soon to re-market itself as "Five Dollar Bush And Rising."

Walmart: to hire 150,000 seasonal workers. 

Delta surge: dropping precipitously. Everywhere. Including Vietnam. Israel. India. US. Coincides with packed college football stadiums.

What Puts Me In A Great Mood Today -- September 29, 2021

What puts  me in a good mood today:

  • United Airlines: bookings back to previous peak in June, 2021.
  • Ford: four new "greenfield" factories; 11,000 new jobs; Tennessee / Kentucky.
  • Apple: held.
  • Housing sales in August: up 8.1% vs 1.2% expectations.
  • My favorite graph.
  • WTI: $20 over "sweet spot."
  • UK: gasoline shortage in UK already improving.

And, of course, summer is not over yet! This, from yesterday:

Weekly EIA Petroleum Report -- Pending -- September 29, 2021

Pending home sales, August, 2021: up 8.1% vs 1.2% expectations. These are SIGNED contracts. Huge jump in SIGNED contracts. 

First things first: how did we miss this? Today is National Coffee Day. Many coffee shops offering free coffee. 

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

Erdoes: over at JPMorgan, Ms Erdoes has it exactly right in her statement (either today or yesterday; probably yesterday). Mary Callahan at wiki. Paraphrasing:

  • investing is a long-term prospect; today, money is a non-earning asset;
  • "everyone is talking like Evergrande is a county. It is not; it is a company. It is a big company. But this is not a Lehman Bros moment.

Bernstein Research: recommends Boeing. "The bottom is in." We'll see. Boeing leads the Dow today.

Lucid: market value soaring. Announced that it will release its first luxury sedan by end of October, 2021. Said to have greater range than the Tesla. Factory in Arizona.

Geographic shifts: has anyone noticed? Automobile manufacturing is moving from the Rust Belt and west coast to just south of the Mason-Dixon line, to the Deep South, and to the Southwest.

ISO NE: link here. The wind wasn't blowing early this morning. A lot of expensive Canadian hydroelectricity was required. Spot prices surges to $100/MWh. Things looking better now; wind must be blowing. At rush hour (into work), spot prices down to $45 / MWh. 

Solar: the dirty little secret in the solar PV industry is that the industry relies on a lot of Chinese coal. When Beijing shuts down industries because of a coal shortage, silicon metal prices to through the roof (>150% this month), which in turn will hit polysilicon, and then solar panels. Link here

China: will expand coal procurement at "any price to ensure heating and power generation this winter." Why is China saying this now? China doesn't have enough coal for the upcoming winter. Rumor: Greta is being treated for paroxysmal atrial tachycardia.

Weekly EIA petroleum report, link here.

  • US crude oil inventories jumped by 4.6 million bbls from last week. Surprise, surprise.
  • US crude oil inventories now stand at 418.5 million bbls, 7% below the five-year average.
  • US crude oil imports averaged 6.6 million bopd; up by 87,000 bpd from the previous week; over the past four weeks, crude oil imports averaged 6.1 million bpd; 18.7% more than same four-week period last week.
  • refiners are operating at 88.1% of their operable capacity.
  • distillate fuel inventories increased -- first break in months -- by 0.4 million bbls last week but still 12% below the five-year average.
  • total products supplied averaged 20.4 million bbls per day, up an astounding 13.7% from same period last year; need to see comparisons to 2019
  • jet fuel supplied was up 64% compared with same four-week period last year. Ditto.

Random Update Of A Few Bakken Wells -- September 29, 2021

CLR inventory: due to lack of updates by the NDIC, it's really hard to figure out what's going on. But I did note that CLR has taken the parent well in the Dennis drilling unit off line. The Dennis / Flint Chips drilling unit is tracked here. Look at all those permitted sites. Wow. There are very few reasons to take a well off line.

The one existing well in the1280-acre drilling unit in that area:

  • 16605, 418, CLR, Dennis 44-8H, Cedar Coulee, t7/07; cum 89K 12/20;  

BR Shenandoah wells are tracked here. This well has just returned to production:

  • 28074, 1,643, BR, Shanandoah 14-36MBH ULW, Keene, 4 sections, t1/15; cum 274K 1/21; off line 1/20;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN/THREE FORKS7-2021312102208872712690126130
BAKKEN/THREE FORKS6-20213021332253988792178470
BAKKEN/THREE FORKS5-202113301261261240
BAKKEN/THREE FORKS4-20210000000
BAKKEN/THREE FORKS3-20210000000
BAKKEN/THREE FORKS2-20210000000
BAKKEN/THREE FORKS1-202150021200
BAKKEN/THREE FORKS12-20203111501170263689968220
BAKKEN/THREE FORKS11-20203011791100245706569910

BR: likewise this well in the same drilling unit has also been returned to production -- the well:

  • 28414, 2,204, BR, Shenandoah 44-36MBH ULW, 4 sections, t3/15; cum 557K 1/21; cum 566K 7/21, 7/21 extrapolates to over 6,000 bbls over 30 days;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN/THREE FORKS7-2021183747377576310528104830
BAKKEN/THREE FORKS6-20212226172597753750074450
BAKKEN/THREE FORKS5-20210000000
BAKKEN/THREE FORKS4-20210000000
BAKKEN/THREE FORKS3-20210000000
BAKKEN/THREE FORKS2-20212116541503376893088780
BAKKEN/THREE FORKS1-20213143654376104222868227910

Whiting Sovig in Arnegard oil field: the last time I looked at this well, it was "inactive" and not producing. It has been returned to production:

  • 27474, 2,321, Whiting, Sovig 24-22-4H, Arnegard, t9/14; cum 191KK 11/19; cum 209K 7/21; production unremarkable:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-202131809763120914911235256
BAKKEN6-2021308219041048129312930
BAKKEN5-2021311043106212312079204831
BAKKEN4-202130112110671194210921036
BAKKEN3-2021319169861771236523030
BAKKEN2-2021281090102910921533140770
BAKKEN1-20213110299571123112810651
BAKKEN12-2020101762194013142940
BAKKEN11-2020306166211010135512941

The Kraken wells in Epping oil field have been updated.

ISO NE: link here. Apparently the wind wasn't blowing early this morning. A lot of expensive Canadian hydroelectricity was required. Spot prices surges to $100/MWh. Things looking better now; wind must be blowing. At rush hour (into work), spot prices down to $45 / MWh. 

Weekly EIA petroleum report: pending later this morning. Link here.

No Wells Coming Off The Confidential List -- China Could Be In Real Trouble This Winter -- Transit Times For Fuel -- September 29, 2021

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.  

Investors: investors should be dancing in the street. Let me re-state that: certain investors should be dancing in the street. One can divide investors into multiple groups. For now, two binary groups:

  • "retired" investors who need the income from their investments to live on vs those who don't (horizon: one month vs thirty years)
  • investors who have a significant income stream and those who do not 

For investors who have a 30-year horizon and who have a significant income stream should be dancing in the street right now.

  • we don't often get stock market pull-backs like the ones we are seeing;
  • nothing suggests the market is in free-fall to zero; huge drops followed by recovery (so far) seems to be the norm (for now);
  • huge, huge, amount of money on the side lines (see my favorite graph; posted numerous times);
  • those with lots of money "off the table" have nowhere else to go; rising rates will provide another option, but at the end of the day Treasuries and money market funds are only good  for "parking" money for short periods of time;
  • the gap between investors and those not investing is widening, and not by just a little bit;
  • it's a stock-pickers market right now;
  • value investors with a huge dividend stream will love this market, will stay on this horse: unlikely many companies will cut dividends in this environment;
  • growth investors are seeing opportunities that don't often arise

Shares:

A number of months ago, it wasn't that long ago -- here it is, November 17, 2019 -- I wrote about this very subject: the number of shares Buffett owns. 
I thought the concept was ridiculous. Again, as usual, I was wrong. 
During this pullback, I am accumulating shares in myriad companies as fast as I can -- mostly due to a limited income stream -- and I don't care what I'm paying. I'm simply buying on the pullback. I'm only buying "good" companies, nothing speculative. 
Why don't I care what I'm paying? Don't take that out of context, of course I care, but I'm not waiting for lower lows. It's impossible to time the market. 
I will never "see" my portfolio. It will all go to the grandchildren. The bottom line value of the portfolio will be important, of course, but for me, something else is going to be much more important? The number of shares in the portfolio. I think that was the point the writer of that article at the linked post was trying to make.
If the day our portfolio passes to the grandchildren and we're in a severe recession, the portfolio might not look so good. But in a bull market, which will ultimately return, the number of shares will be what the grandchildren will thank me for. 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

Covid -19 and United Airlines:

  • has a mandate
  • considering applications for exemptions; will decide within "weeks"
  • 97% compliance (this really, really caught me by surprise)
  • 2,000 seeking exemptions
  • 503 fired to date over issue

Japan: will end an extended Covid state of emergency in all areas as of tomorrow, September 30, 2021, in response to a steady fall in the number of infections.

Vietnam: remember Nike! Well, that has spread to Apple. Holy mackerel: a most interesting graphic. Maybe a good time to check out Nigeria with "ivermectin" on one's mind. Not a good picture, especially with rate of deaths.

OPEC+: unwilling and unable to stop oil price rally. Link to Irina Slav. Wow, I wrote about this years ago when there was a similar spike in oil prices. One of the reasons I write so much about non-Bakken topics: it helps put the Bakken in perspective and it helps me understand why the Bakken is doing what it's doing. If that makes sense. 

For example, a reader asks why aren't operators drilling all out in the Bakken with prices so high? I'll post the comment in a moment. The answer is obvious from all that I've written over the years. I may or may not answer the reader's comment but I'll probably reply.

China: how bad could it be for China this winter? See RBN Energy today (scroll down). But if China is already running out of coal and natural gas, and winter is not here yet, think about this:

A round-trip voyage between any of the Gulf Coast LNG terminals and Japan, China or South Korea — the Far East destinations where the bulk of LNG demand is concentrated — via the Panama Canal takes around 60 days, including port loading/unloading and transit time. Of course, delays at the Panama Canal, like those seen last winter, can add additional days to the voyage. If a vessel wants or needs to avoid the Panama Canal, the most common alternative would be to go around the Cape of Good Hope (CGH) in South Africa, which takes about 75 days for a round trip, 25% longer than the Panamanian route. The cost-saving from not having canal fees is more than negated by the additional voyage time. In the past year, according to our cost model, on average it is about $0.30/MMBtu more expensive to go around the CGH than via the Panama Canal.
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Back to the Bakken

Active rigs -- 25 -- from the daily activity report at the end of day.

$74.86
9/28/202109/28/202009/28/201909/28/201809/28/2017
Active Rigs2511576658

No wells coming off confidential list
.

RBN Energy: red-hot natural gas markets help push North American LNG to Asia. Archived.

With multiple energy markets around the world facing natural gas shortages, buyers are clamoring for more LNG. Pre-winter panic-buying has sent global gas prices to record highs yet again in the past couple of days, and even hauled Henry Hub gas futures up to new post-2008 records above $6/MMBtu in after-hours and intraday trading. With the incredible run in global gas prices, U.S. export economics have looked extremely attractive for nearly a year now, and you would think that buyers would be lining up for new liquefaction capacity in the U.S. Well, it has certainly drawn prospective offtakers back to the table. But they are wary of rising export costs and committing to projects long-term given the questionable future for hydrocarbon markets. Additionally, Europe’s rising piped gas imports from Russia and overall declining demand in the region have put long-term prospects for European LNG imports, in particular, on shaky ground. So, access to Asia is more important than ever for new LNG development, a key selling point for projects on North America’s Pacific Coast, both because of proximity to Asian markets and the absence of canal fees or constraints versus the Gulf Coast. There are no LNG export terminals on the Pacific Coast currently, but two projects — LNG Canada in British Columbia and Sempra Energy’s EnergĂ­a Costa Azul (ECA) LNG in Baja California, Mexico — are under construction and due online mid-decade. Those projects are unlikely to be the last, given the more than $1/MMBtu in cost savings due to shorter voyage times and canal-free access to Asia. In today’s RBN blog, we begin a series looking at the state of LNG development on the North American Pacific Coast.

Back-to-back LNG blogs? We normally like to mix it up when it comes to blog topics. However, the past two days have been anything but normal in the gas markets. Global gas prices were already in the midst of the most epic bull run in modern times, if not ever, with gas prices abroad pushing to new highs all summer and into fall. This has been underpinned by strong global gas demand and a gas shortage in Europe, but now a coal shortage in China has sent the market into another upward spiral as the entire world weighs the impacts of multiple countries facing energy shortages and winter reliability fears. This has sent Asia’s Japan Korea Marker (JKM), Europe’s Dutch Title Transfer Facility (TTF) and the UK National Balancing Point (NBP) to all-time highs yet again this week. The U.S. gas market is tight as well, but it’s not facing the same kind of shortages. Even so, gas prices here have been unable to escape the upward pull. The October Henry Hub gas futures surged nearly 60 cents (11%) on Monday — the biggest single-day gain in nearly three years — to record a new post-2008 high of $5.706/MMBtu, despite little change in domestic fundamentals. Then, in after-hours trading Monday night, the prompt contract blasted past the $6/MMBtu mark and again topped $6/MMBtu in early trading Tuesday before expiring at about $5.84/MMBtu. This, as JKM reached a high-water mark just under $30/MMBtu. The linchpin for these dramatic price moves is of course LNG. Yesterday, we looked at the near-term impacts of rising LNG export capacity on U.S. gas demand, with commissioning for both Sabine Pass Train 6 expansion and the new Calcasieu Pass facility well underway and first LNG exports expected this winter. Next, we shift our focus longer-term to another aspect of the all-important LNG supply picture: the economics of North America’s Pacific Coast vs. Gulf Coast export projects.