Thursday, October 7, 2021

WPX With Three New Permits; Seven Permits Renewed; Four Permits Canceled -- October 7, 2021

Baseball and football tonight: what a great country.


  • gold has lost its luster; gold bugs out
  • gold bugs have probably gone to Bitcoin

The golden state:

  • has lost its luster;
  • Tesla HQ to move to Austin, TX

Covid-19: I said the other day that vaccinations would now snowball --

  • United Airlines is already there;
  • Los Angeles passes most stringent "passport' requirement;
  • IBM will mandate vaccines
  • now, today, breaking: American Airlines says all workers must be fully vaxxed;

Fancy Like, Walker Hayes featuring Kesha, think AppleBees -- the commercial -- one billion views (so far) and viral on TikTok -- what a great country:

Back to the Bakken

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

Active Rigs2613576459

Three new permits, #38602 - #38604, inclusive:

  • Operator: WPX (Devon)
  • Field: Mandaree (Dunn County)
  • Comments:
    • WPX has three Packineau permits, to be sited in NWNW 17-149-93;
    • between 1083 FNL and 1054 FNL and between 1236 FWL and 1241 FWL

Seven permits renewed:

  • Petro-Hunt (3):
  • BR (2):
  • Iron Oil Operating:
  • NP Resources:

Four permits canceled:

  • EOG (3): three Liberty LR wells, in Mountrail County, SESE section 11-151-91;
  • Rimrock: 33205, Rimrock Oil, Moccasin Creek, 16-10-34-1HU, Dunn County;

Starting The Weekend Early -- Nothing To Do With The Bakken -- October 7, 2021

This is just for my benefit. I have a gazillion serious readers out there. I'm hoping none of them see this post, and if they do, they don't read it, and if they do, they know it's just for fun.

This past weekend I took a road trip and had a blast. Great music on the radio and incredible runs on the highways and by-ways. Left on Thursday and returned Monday.

I can’t wait to do it again, but it might be a few weeks. Until then I will have to settle for YouTube. This was one of my better "musical" posts, from several years ago. 

Again, this has nothing to do with the Bakken. Just for fun. I'm starting my weekend early.

Re-posting from September 13, 2018.

For several years -- or maybe it was only for several months -- I would often stay up well past midnight, put on the headphones, and surf YouTube. I could put myself into a fugue state moving from one video to the next. I chose the next music video -- it was not chosen by some YouTube algorithm -- but the deeper I got into the fugue state the farther I drifted from where I started.

Tonight, it started with Baillie and the Boys' A Fool Such As I which led to Don Gibson's Sea of Heartbreak. Everyone has covered A Fool Such As I but I think Baillie's is the best. Strangely, I could find no one who out-did Don Gibson's Sea of Heartbreak.


Sea of Heartbreak, Zombina and the Skeletones
From there, to:

It's Good To Be Alive, Imelda May
Tainted Love, Imelda May

I knew I had heard that song somewhere but a devil of a time remembering where, until it hit me. "The history teacher!"

Tainted Love, The History Teacher

I had never heard Tainted Love except by "the history teacher." I never thought of looking up the original. But now having seen/heard Imelda May, I had to see the "original" Tainted Love.

Tainted Love, Soft Cell

Johnny's Got a Boom Boom, Imelda May.

Fuzzy n' Wild, The Vice Barons, needs to be played really loud.

Back to Zombina and the Skeletones, Vincent Price.

And, then, to this ... finish with a squeeze box -- hey, I'm in Texas.... although this is really from South Texas and I'm well into North Texas.

All You Ever Do Is Bring Me Down, The Mavericks

I'll be up for awhile getting deeper and deeper into this fugue state. No more posting but if you want to  join me meet me in Morocco ...

Only Lovers Left Alive, Official Movie Trailer

In Case You Missed It -- KMI Proposes Short Pipeline In Williams County -- October 7, 2021

KMI: will lay a short pipeline in Williams County to connect to the DAPL. Link here. Direct to Amy R. Sisk here.

  • Hiland Crude, a subsidiary of KMI, is proposing a 2.9 mile pipeline in Williams County
  • origin: at its Epping Station (a few miles southwest of Williston)
  • terminus: unspecified tap-in location to the DAPL
  • 8-inch diameter, steel
  • will transport 30,000 bopd with capacity for double that (63,000 bopd)
  • $5.4 million
  • $5.4 million / 2.9 miles = $1.9 million / mile or rounding, $2 million / mile
  • remember when greenfield pipeline ran about $1 million / mile
  • this helps put value on existing pipelines across the nation
  • the burggraben widens

Notes From All Over -- Part 1 -- The Investor's (Investors') Page -- JOLTS -- Trolling -- October 7, 2021


  • did folks know that Samsung bought Garmin?
  • Apple will be huge player in "managing" automobile experience
    • my hunch: a natural spin-off of other research

Jobless claims, first time: down 38,000 to 326,000 (yawn)

  • 11 million job openings
  • total claims:
    • had been 11 million under extended benefits;
    • recently dropped to 5 million total claims
    • today: about 4 million total claims
  • Steve Liesman, CNBC: things improving and improving "somewhat rapidly"
  • continuing claims: link here;
    • due to the "compressed" "y" axis it looks quite "impressive"
    • in fact, not all that impressive: from 3.3 million to 2.7 million
    • despite job openings at eleven million
  • market reaction: pretty much unchanged; if anything, up slightly;
  • Fed chairman has set the bar low for raising rates, based on jobs data
  • not sure if today's data is trending toward Jay Powell's goalpost 

Port delays:

  • 66 ships anchored off Los Angeles ports
  • ten days for a ship once anchored to get appointment time for unloading
  • long pole in tent: lack of warehousing upstream; even if enough trucks / drivers at the port, nowhere to take the products upstream;
  • another long pole in tent: lack of trucks / drivers
  • data we never get: number of trucks / drivers in 2019 vs 2021
    • more/less tractors in 2021 vs 2019?
    • more/less CDL truckers in 2021 vs 2019?
    • over-the-road regulations in 2021 vs 2019?
  • retailers turning to trucks vs rail to get products; trucks much, much faster

Trucking regulations: later, after posting the above, wondering out loud what was going on with trucking that might help explain what was going on at the ports of Los Angeles and Long Beach. A reader who works in the trucking industry provided this which goes a long way explaining some (all?) of this:

California had a proposition changing the way independent contractors are classified. They changed the classification to employee if they are doing a job that the employer also has hourly employees doing. If you have trucks and drivers employed, you cannot use independent contractors to do the same job, they would be classified as employee for benefits, taxes , union representation etc. This reduced drastically the number of available trucks and drivers. The independent owner operators all left the state . Most of the port drivers are owner operators who own  their trucks. When they could no longer work , they left the state.

The port operators are stuck with no equipment, at least a one-year backlog for any class 8 trucks, and all new environmental regs apply so they can’t use used equipment unless it is CARB approved and there is a shortage nationwide of used equipment.

This slow down in freight movement was foreseen by the industry, but the great state of California won’t budge on the regs. It’s been through court and the port operators are stuck.

The next shoe to drop with regard to drop: intermodal transport. Those 18-wheelers are a standardized length, width, and height for a reason as are the railroad cars that carry them. We discussed this a long, long time ago.

It took years (decades) for this intermodal transport to mature. Now, with the very, very heavy batteries in EV trucks, the cargo they can carry will be significantly less, which means .... drum roll .. the trailers will be significantly shorter. 

Unfortunately they won't be half the size but somewhere between "full-size" and "half-size" which means the efficiency of the intermodal transport system will be completely torn asunder.

Most likely these EV trucks/trailers will fill a niche, but whether it will include cross-country shipping is yet to be seen. Remember: the truckers would like to have "Australian road trains" through long-haul states like Montana, Wyoming, Colorado, New Mexico, Arizona, west Texas, and Nevada.

It's going to be tough to make the "financials" work.

The Investors' Page

I'm not sure where this post will go. 

Risk-on, slow melt-up, the market can handle:

  • 2.5% on the 10-year Treasury; and,
  • $110 WTI

Covid-19: again, this is for investors, no one else --

  • analyst said it this morning about as clearly as anyone could say it
  • it doesn't matter whether the vaccines work or don't work
  • the only thing that matters is perception
  • Germany: today announces there will be no new pandemic restrictions this winter with regard to Covid-19
  • how come? has nothing to do with current number of infections, deaths, etc.
  • Germany says it won't introduce new pandemic instructions this winter because vaccination rate has exceeded a certain percent (I missed what that number was; doesn't matter; Germany says enough folks have been vaccinated for the country "to move on")

Reconciliation: definition / background;

  • GOP has clearly stated they will "allow" Democrats to use "reconciliation"
  • Democrats who once threatened to use "reconciliation" to raise the debt limit, now says the party does not want to use the "reconciliation" process
  • one problem: unlike the recent past, the US House Democrat party has become very fractured; Ms Pelosi has lost control

Market caps:

  • Square: $110 billion
    • market cap greater than Bank of New York / Regions Financial combined 
    • market cap greater than PNC / Regions combined
  • JP Morgan Chase: $500 billion
  • Citi Group: $147 billion
  • PNC Financial: $85 billion
  • BK (Bank of New York Mellon): $47 billion
  • Regions Financial: $21 billion

Op-ed: must-read from The WSJ today -- the entitlements of US decline; Biden says his plans will make America great again. Ask Europe how that has turned out. Link here. The lede:

Democrats are scrambling to find an argument, any argument, that sells their $5 trillion spending plan to a skeptical public. The latest, and startling, attempt is President Biden’s claim that all of his new entitlements will, well, make America greater.

“To oppose these investments is to be complicit in America’s decline,” Mr. Biden said Tuesday, adding that “other countries are speeding up and America is falling behind.” Got that, Senators Joe Manchin and Kyrsten Sinema ? You’re complicit in the country’s looming failure.

Finally being acknowledged: the benefits of oil for the US

  • previous spikes in the price of oil have been devastating for the US
  • not this time
  • 10% increase in price of WTI used to cut 25 basis points on GDP; no longer, pretty much a wash
  • as price of WTI increases, increased activity in oil sector offsets negative impact of higher prices
  • % of disposable personal income, six-month average:
    • 1975: 6.5%
    • 1980: 8.4%
    • 1990: 5%
    • 2008: 6%
    • 2020: 3%

Stagflation: this is my pet peeve. A few weeks ago, this was a "thing" on CNBC -- 

  • although CNBC seems to have moved on; not mentioning stagflation much any more
  • there are a couple of different definitions of stagflation
  • I don't see either definition being met by current use of the word "stagflation" by CNBC talking heads
  • at least one definition of "stagflation": a key component of "stagflation" is the concept of unemployment

Request for help from readers: JOLTS

  • JOLTS has been around for at least a couple of decades, I do believe, but even wiki does not have a page on JOLTs, which is surprising since wiki seems to have a page on almost everything else
  • I am unable to find a graph going back more than two years regarding JOLTS
  • JOLTs seems to have become a thing only beginning in calendar year during the year of the plague, 2020, and especially now, coming out of the pandemic
  • Later, October 8, 2021: CNBC showed the JOLTS graph going back to 2005
    • in round numbers, it appears JOLTS runs about 4,500 - 5,000 / month
    • in round numbers, it appears JOLTS was 7,500 in 2019, just before the pandemic year of 2020
    • huge drop in JOLTs during the year of the pandemic
    • 2021, the year after the year of the plague; JOLTS went almost straight up month over month so that it ended at/near 12,000 in September 2021

"Full employment": hard to define.

"Umemployment": I've talked about this before. Is there a difference between unemployment numbers during:

  • a recession in which there are simply no jobs available when folks are desperately looking for work; or,
  • during a manufactured pandemic when folks don't look for jobs resulting in record amount of jobs available

Unemployment: talking heads seem to suggest that unemployment of 5.2% now --during economy expansion -- is no different than unemployment rate of 5.2% during an economic downturn. I honestly don't get it.

Roth vs traditional IRAs: see if you can find the fallacy in the argument presented by this writer -- "why I won't do a Roth IRA conversion -- even  if this is the last chance." Brett Arends is very, very knowledgeable and has been around for quite some time. How he missed this fallacy is beyond me. His argument:

  • most of us -- including the writer, Arends -- are almost certainly going to be better off in a traditional IRA
  • his fallacy: see if you can find it
Goldman's Currie: $90 oil
  • so far behind, no matter what OPEC+ or the US does, it cannot catch up
  • must-see interview on CNBC

Henry Hub Flows Hit 13-Year Highs; Two Wells Coming Off Confidential List; Penn Virginia Becomes Ranger Oil -- October 7, 2021

Firster things first:

  • ARKK / Cathie Wood leaving NYC; heading to St Petersburg, FL -- wow!

First things first: in my final note yesterday, I suggested today would be a great day for investors. So far, so good.

  • Dow implied open: +228 points
  • but did you see this: Bitcoin surging; this is simply incredible; it's down a thousand dollars right now but it's still flirting with $54,000
    • Bitcoin trading above $54,500 Thursday, up 8%; Ethereum, Dogecoin up 7% and 2%, respectively;
  • raising the debt limit "cheered"; and if I read it correctly, raising it once now, will prevent doing this again in the near term; in other words -- and I may have this wrong -- the debt limit was raised for calendar year 2021; and has been raised for late in calendar year 2022. 
    • if accurate, and I may be wrong, but if accurate, I reiterate, for all the crap Biden gets, he's having a pretty good year -- at least for investors --- perhaps not so much for everyone else.
    • update: most recent reading of the tea leaves -- debt limit raise will only be short-term, taking "us" through December, 2021

Not new: don't say "master suite." Realtors revisit the power of words. Link here. I was unaware of this but it is not new. It goes back to at least the 1990's. But I did not know. We still use the phrase.

Europe: pretty amazing. Everyone is falling all over themselves praising Putin and his promise to save Europe.

Penn Virginia/Ranger, link here:

  • plans name change: will soon be called Ranger Oil Corp
    • reflects oil and natural gas operations in Texas
    • will officially rebrand as Ranger Oil Corporation
    • began trading under the NASDAQ ticker symbol of ROCC effective October 18, 2021
    • rebranding to be fully complete prior to year-end 2021 
    • link here;
  • plans more Eagle Ford growth
  • recently acquired Lonestar Resources
  • sales of 38,000 boepd
  • capacity to be a consolidator in the Eagle Ford market
  • Lonestar acquisition added 250 well locations to Penn Virginia's roughly 500 (50% increase)
  • much more at the link; a wordy article that's a bit hard to understand; takes too much time to read

Back to the Bakken

NOG: announces acquisition;

  • $154 million bolt-on properties-deal
  • Williston basin
  • seller(s) not identified
  • 400 producing wellbores
  • spread across the Bakken: WMS, MCK, MNT, and DUN counties
  • interestingly, number of acres not provided
  • > 4,500 boe per day (2-stream, ~65% oil)
    • $154 million / 4,500 boepd = $34,000 / flowing boepd (in line)
  • management to submit 33.3% increase to the quarterly dividend to six cents per share upon closing

KMI: will lay a short pipeline in Williams County to connect to the DAPL. Link here. Direct to Amy R. Sisk here.

Active rigs:

Active Rigs2613576459

Two wells coming off confidential list 

Thursday, October 7, 2021: 10 for the month, 10 for the quarter, 234 for the year:

  • 37197, conf, Slawson, Mauser Federal 5-18-17H, North Fork, no data, scout ticked not updated;
  • 30201, conf, Whiting, Klose 21-27-3H, Glass Bluff, nice production, scout ticket not updated;

These are the last wells coming off the confidential list through the end of the week and into next week. No wells are coming off the confidential list for the four days starting tomorrow. 

RBN Energy: Henry Hub physical flows hit 13-year highs amid rising LNG exports. Archived.

Henry Hub has long been the center of the universe for the Lower 48 natural gas market, but what it represents has changed dramatically since its inception, particularly over the past decade. It has gone from being a benchmark pricing location for a vibrant producing region, to being situated in the fastest-growing demand region and a key hub for wheeling feedgas supply to the proliferating LNG export facilities in Louisiana — all with little change to its infrastructure. As this occurred, the gas price at Henry has gone from being among the lowest in the country to one of the most premium. Physical volumes exchanged at the hub, which have always been dwarfed by financial trades there (and still are), have climbed in recent years and are now at the highest levels since 2008. Moreover, the inflows are concentrated on just a couple of pipelines, and those key interconnects are at risk of becoming constrained. In today’s RBN blog, we provide an update on the shifting gas flows at Henry Hub.  

The last time physical flows at Henry Hub were this high, in the 2008-09 time frame, Gulf of Mexico offshore natural gas production was well over 6 Bcf/d; the Haynesville Shale in western Louisiana was still in its early stages of growth and volumes had just started to take off; the Marcellus Shale in Appalachia was still in its infancy; and all the offshore and onshore supply converging on the pipeline network in Louisiana, including Henry Hub, was flowing northbound to serve the gas-thirsty Northeast markets. Now, offshore production is less than half of what it was then, but Haynesville production hit a record 13.4 Bcf/d in September, according to the Energy Information Administration’s Drilling Productivity Report (DPR). The same pipelines that used to flow north now bring 3-5 Bcf/d of Marcellus/Utica gas supply into Louisiana, mostly via Perryville Hub in northeastern Louisiana — and, yes, Henry Hub in the southeast — to meet growing demand along the Gulf Coast, primarily feedgas for LNG exports.