North Dakota: A Gift To The Planet -- U.S. Secretary of Energy Jennifer Granholm -- But We Already Knew That -- October 14, 2021

Over at Yahoo!News: 

U.S. Secretary of Energy Jennifer Granholm, during a visit to the Energy & Environment Research Center at UND, said she believes North Dakota is poised to play a key role in addressing climate change.

Granholm visited Grand Forks on Thursday, Oct. 14, to tour the EERC with Sen. John Hoeven, R-N.D., and Gov. Doug Burgum. Following that tour, they held a discussion with energy company executives from across the state.

That discussion focused on the generation of clean power, but also on advancing to commercialization carbon capture utilization and storage technology (CCUS) — essentially stripping carbon from coal or other energy sources, and burying it underground. Energy executives said doing so will require expanded federal financial assistance.

Granholm said she doesn't view combating climate change with a silver bullet, but rather "silver buckshot." In North Dakota, that buckshot pattern hits several targets, including further rolling out wind and solar power, but also working to decarbonize fossil fuels.

And, then look at this:

Burgum said North Dakota "hit the jackpot of geology" because the state can store 252 billion tons of carbon underground in a carbon "sink." That amount, he said, equates to 50 years of national carbon production from energy generation, or 4,400 years in what North Dakota generates on its own.

Granholm agreed, saying: "You've got a comparative advantage, clearly in carbon capture and storage because of your geography," and called the storage capacity a "gift to the planet."

In May, Burgum announced an ambitious plan to make North Dakota carbon neutral by 2030. Burgum said since that announcement, investment from outside the state has poured in, to the tune of $25 billion for projects like carbon capture programs.

Trenton Lands One Of State's Largest Economic Expansion Projects To Date -- Source -- October 14, 2021

Updates

November 16, 2021: update here. Williams County loan.

Original Post 

If this doesn't blow you away, nothing will.

Population of Trenton, ND: 372 people. 

Link here. 

Trenton, ND: a few miles southwest of Williston, ND.

Gas-to-liquids plant.

Canada-based Cerilon GTL.

But look at this, for little ol' Trenton: a $2.8 billion plant.

Will start with an initial 24,000 bpd of ultra-low sulfur diesel, and:

• military-grade jet fuel;
• naphtha,
• Group III base oils

Construction to begin in early 2023.

Infrastructure already in place:

• rail
• pipeline
• also has carbon sequestration opportunities

Company anticipates future construction phases and more facilities as part of  its overall vision for the complex.

“The Cerilon GTL complex has the potential to be one of the largest economic expansion projects in the history of North Dakota,” he said. “GTL facilities support the oil industry while reducing environmental impacts. The Williams County facility will be one of many expansions that make North Dakota a leader in carbon neutrality.”

If Governor Burgum had anything to do with getting this project in North Dakota, he needs to be declared governor for life.

Now, if he could only get the NDIC website working.

Closing Notes From Social Media Today -- October 14, 2021

EU green pass rules: vaccine mandates. Gonna get interesting. Google Italy's mandate to take effect tomorrow, Friday, October 15, 2021. Vaccines or test every two days, individuals paying for tests themselves. Huge fines if they show up to work without their green passes. 

Elections have consequences: remember, Resident Biden is "the boss" and all those federal departments work for him. Not lost on the military. Announced today:

US Navy will expel personnel who refuse Covid-19 vaccine by 11/28/21.

Global warming: China's president Xi will not attend COP26 Conference / Glasgow, Scotland. Something on which I can agree. Xi not going to be part of group think when it comes to global warming.

Oil & Gas Journal: the ongoing energy crisis has prompted a switch to oil that could boost demand by 500,000 bopd compared with normal conditions -- IEA. I think this is old news. This was posted about the time it was announced that OPEC would raise production by 400,000 bopd. I noted that the math was easy to do. WTI trading at $81.57.

Definition of spare capacity: the 30 / 90 rule. Able to increase production within thirty days to meet increased demand for ninety days (or something like that -- need to confirm).

Top video of the day: https://twitter.com/buitengebieden_/status/1448690344711819266.

Discipline? Shale producers likely to "forget" discipline at $85-WTI -- TotalEnergies CEO.

$746: per month. Average cost to heat US home this winter. The Guardian. That's average, so if you suggest you will be paying much less, someone else is paying much more. This is 30% more than a year ago. That's for natural gas. It will be even worse for heating oil. 

Reminder: Resident Biden canceled the Keystone XL; banned fracking / then slow-rolled leasing on federal land. 

Cushing: oil jumped Thursday as a US inventory report revealed the largest stockpile reduction at Cushing since June. 

Fracking: Halliburton will deploy an advanced, all-electric fracking solution in the Haynesville. 

Copper: inventories dropping fast. This is an interesting one. It was a throw-away line by some CNBC talking head the other day. Copper shortage being driven by .... telcos building out their streaming services to compete with ... outfits like Hulu over cable ... or something to that effect ... and then we have all those EVs ... which is all about copper. SCCO surged 6% today, and is up another 1% in after-hour trading.

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. 

NE ISO Alert; Two New Whiting Permits; Nine Permits Renewed; Hess Reports A Completed DUC But NDIC Provides No Data -- October 14, 2021

23andme: next Robin Hood stock? You heard it here first.  

Politics: not many things are decided unanimously

 ... but FDA advisers unanimously recommended Moderna booster. Mix and match may be better than sticking with original series. Exciting. Regardless where one stands on Covid vaccines, we have learned a lot. From an investor's point of view, never let emotions control investment decisions.

Virgin Galactic: the "Boeing" of space flight? Shares sinking after hours.

• Jeff Bezos: 6
• really takes you to space -- though barely
  
• that Virgin Galactic fellow, what is his name? 0
• really doesn't take you to space
  

CDC: dated their release with today's date but did not update the numbers. Link here. 

Harsh Thanksgiving: US Navy will expel personnel who refuse Covid-19 vaccine by 11/28/21.

Huge market today:

• CNBC chartist says we may have seen the high for 2021 today;
• and Jim Cramer said we saw the high for WTI earlier this week;
• wow.

Clearing off the desk:

• weekly influenza surveillance report, the CDC;
• every day it's a different state that's in dire Covid-19 circumstances; today it's Alaska;
• yesterday it was Michigan and Minnesota; was this the last Covid surge?
• "money ball" thinking killed the stolen base -- WSJ; the question I have, have they ever found that stolen base?
• another meme put to rest: mass evictions did not result after US ban ended -- WSJ;
• Energy:
• oil and gas not going away; will be here for decades -- Russia; link to Charles Kennedy;
• US crude oil in storage; days of supply increased slightly; so why is Resident Biden worried about lack of production; nothing makes sense;
• most interesting: is the US still a swing producer of oil? -- Oilprice -- link to Irina Slav; this is interesting because I've argued for years that shale is the swing producer; Simon Watkins actually addressed this in a post linked earlier; swing producer and spare capacity;
• are you kidding me? Some folks think gas-rich Israel could save Europe from its self-inflicted energy crisis; link to Charles Kennedy;
  

ISO NE: why I love to blog. Folks, I hope, have noted my increased frequent links to ISO NE -- a reader much more knowledgeable on this issue than I sent this note. It's a brief note because the reader is time-constrained but hopefully will expand on this later. The note:

At 15:00 Eastern Time, NE ISO issued alert relating to potential capacity shortage shortly (evening 'rush hour'). 2 nuke plants - Seabrook and Millstone (3?) have been down for, I guess, routine maintenance. 

That would take about 2,200 Megawatts offline. Next few hours could be ... interesting. The current hydro generation comes from ~60 tiny, mostly run of river old plants. The hoped-for Canadian input is looking to be shot down in coming weeks via ballot, as you have noted. I will follow up - hopefully - tomorrow.

Link to ISO NE.  

Holy mackerel, or holy lutefisk! The reader is correct. ISO NE just went "yellow." Cost of electricity is now well north of $100 / MWh. The mix:

• nuclear: 10%
• natural gas: 76%
• renewables only 5%
• which means New England is counting on expensive hydroelectricity from Canada: 9%
• it's 5:00 p.m. on the east coast; the data lags by about an hour; one would expect peak demand over the next one to three hours;

Later, the reader added this about ISO NE:

Yes ... and the 'Day Ahead' pricing (dark grey tab in that upper right, real time chart) shows ~$120/Mwh for this time tomorrow.

The Day Ahead pricing actually comprises the vast bulk of the  contracted electricity amount/cost as the ISO folks ensure a set amount will be generated and the producers - bidding against one another, lowest winning - are prepared/committed to providing it at an already-known cost. 

The spot pricing (the default setting when one pulls up the site) is the difference between the contracted Day Ahead and the actual, real time market needs.

This can be seen in the very first, left top chart as the difference between the Green line (Day Ahead/Cleared) and the Orange line (actual, real time demand).

Speaking of New England, this may be the problem:

A Vermont farmer decided he was going to save the world from climate change, so he traded his tractor for a mule. 

He soon realized that feed for the mule cost more than fuel for the tractor. He decided to train the mule to eat less. 

Just when he got that damn mule trained to eat nothing it died. When neighbors asked him why his mule died he just said  "climate change."

Sounds similar to Covid. Motorcycle fatalities who test positive post-mortem for Covid -- to protect the pathologist -- are recorded as Covid deaths. 

Carl Icahn back in the news: Southwest Gas spiked over seven percent today. As Jim Cramer would say, "there's always a bull market somewhere." Nice chart action today:

**************************************
Back to the Bakken

Amazing: NDIC has been working on its IT user interface since July 14, 2021. Scout tickets not being updated. Map not being updated. No progress from the user's point of view. Three months for something that should have been resolved in a day or two. Is the CIO even in Bismarck, ND, working the issues? At home with Covid? Asking for a friend. 

Active rigs:

$81.45	10/14/2021	10/14/2020	10/14/2019	10/14/2018	10/14/2017
Active Rigs	29	16	58	67	59

Two new permits, #38617 - #38618, inclusive:

• Operator: Whiting:
• Field: Sanish (Mountrail)
• Comments:
• Whiting has permits for two Savannah TTT wells in NENE 26-154-92;
• one well will be sited 351 FNL and 439 FEL and the other well will be sited 351 FNL and 469 FEL

Nine permits renewed:

• Zavanna (4): four Galloway permits, all in SESE section 18-154-99, Williams County
• MRO (3): an Arnew permit; an Archie permit, and, an Erbe permit, all in lot 1 section 6-144-96, Dunn County
• EOG: a West Clark permit in McKenzie County; lot 2 secton 01-151-95;
• Slawson: an Armada Federal permit in in NENE section 15-151-92

One producing well completed:

• 37707, 2,297, Hess, EN-Johnson-155-94-2017H-7, Manitou, not updated by NDIC; again, no idea what's going on; interestingly enough, the well is sited in Manitou but the horizontal runs south into the Alkali Creek;
  
• two adjacent pads, a six-well pad to the north, Manitou oil field; an eight-well field to the south, Alkali Creek
• 28250, SI/AB, scout tickets not updated so I have no idea what's going on;
  
• 28251, 683, off line 8/21; t11/14; cum 166K 8/21;
  

Weekly EIA Petroleum Report -- October 14, 2021

Is anyone paying attention:

• total petroleum product supplied two years ago, 2019, save week as this week: 21.1 million bpd
• this year, total petroleum product supplied this year, this report: 20.7 million bopd
• and the US economy is not even close to being fully open, and the supply chain shortage is still a huge obstacle
• how can one not be bullish?

Disclaimer: I am always inappropriately exuberant, always inappropriately bullish. This is not an investment site.

Link here.

• US crude oil inventories increased by a whopping 6.1 million bbls:
• US crude oil in storage now stands at 427.0 million bbls;
• US crude oil imports average 6.0 million bopd; decreased by 1.0 million bopd; over the past four weeks, crude oil imports averaged about 6.5 million bopd (yawn)
• refiners are operating at 86.7% (yawn)
• distillate fuel inventories unchanged from previous week; 9% below the five-year average
• jet fuel product supplied was up 53.5% compared with same four-week period last year;
• but look at this -- is the economy back or what? total products supplied was up by almost 13% from the same period last year.  
• total products supplied: 20.7 million bbls
  
• so, let's look at the report that was released the same date, two years ago, 2019; link here:
• total products supplied over the last four-week period averaged 21.1 million bpd, up by 5.4% from the same period, 2018
  

****************************
Delta Has Clearly Peaked

Except in a few states including Minnesota and Michigan.

Saudi Lies -- October 14, 2021

Re-posting.

Perhaps the most interesting column today and by one of my favorite writers, Simon Watkins. Archived. 

• Last week, Saudi Aramco’s chief executive officer, Amin Nasser, said that the company expects to boost its oil production capacity to 13 million barrels per day (bpd) by 2027.
• The EIA defines spare capacity very specifically as production that can be brought online within 30 days and sustained for at least 90 days.
• Saudi Arabia stated for decades that it had a spare capacity of between 2.0 and 2.5 million bpd.
• Saudi Arabia pumped an average of 8.162 million barrels per day of crude oil. Not 10 million, 11 million, 12 million, 13 million, or any other figure that it suits the Saudis to dream up: 8.162 million barrels per day. 

Is Anyone Paying Attention? October 14, 2021

Poll: I put up the poll at the sidebar at the right asking readers whether they thought we had seen the high for WTI this year -- at $81 (on the generous side) on October 12, 2021 -- for a specific reason.

That was the day that Jim Cramer called it -- saying that the high for WTI was in for calendar year. He had some historical data to back up his claim. If WTI does not trade higher than $85 for at least two consecutive weeks before the end of the year, I will give Jim the "win." 

Gut check: by the way, speaking of Jim Cramer. One Monday night earlier this week on "Mad Money," a caller asked Jim about AirBNB. Jim paused; he was unsure; mumbled and then answered: "Hold. I would not sell now." What happened the next day and the next two days?

• Monday night, when asked about AirBNB, it closed at $167
• he told the caller not to sell
• Tuesday morning, AirBNB surged to $174. Wow.
• Wednesday, peaked at $175
• today, Thursday, some profit taking, trading at $172
• I assume the caller was happy with Jim's answer.

New England, "Peter, I will take "Yes" to block." New England will need more "clean power" even if the CMP corridor is built. Link here. A reader sent me this link. First question: "clean power"? Even if the CMP corridor is built, will New England need more power -- regardless of source -- or only more "clean power"? Does that make sense? Let's see what the writer says:

The upcoming referendum over a transmission line through western Maine will have broad implications for New England and Quebec’s energy future, as the demand for massive quantities of clean energy will persist regardless of the outcome.

Mainers will vote November 2, 2021, on a question that aims to block the $1 billion corridor being built by Central Maine Power affiliates and Hydro-Quebec through western Maine while requiring legislative approval for infrastructure projects on public lands. A yes vote in the referendum would block the project, while a no vote would allow work to continue.

It has been an all-consuming political fight in Maine, where more than $60 million in political spending has come from the energy companies on both sides of the project. The tension over the project has overshadowed New England’s persistent demand for new power. It was a response to a massive clean-power request from Massachusetts in 2017 that only took center stage after a similar proposal in New Hampshire was nixed by regulators.

Is anyone paying attention?

• ten-year treasury: down a bit or at least not going higher, 1.53%; 
• if inflation was that big of a concern would the ten-year treasury be going up? I don't know; I don't understand macro-economics
  
• WTI: $81.18
• Bitcoin surging
• US announces lease sales for massive offshore wind expansion -- that will solve the problem (LOL);
  
• not sure how accurate or meaningful but it is being reported that Resident Biden has consulted with the US oil industry about soaring gasoline prices;
• some say he also consulted recently with OPEC but that is being disputed, I believe (fact-check me on that)
• market surging today
• inflation numbers not coming in as scary as folks thought they would (arguable)
• the gap between investors and non-investors continues to widen
• worse, the gap between the haves and the have-nots will really continue to widen (I'm thinking of those folks going on strike, and the folks not returning to work due to Covid fears)
• the daycare issue: malarkey. Daycare centers fully opened where we live; I assume that's true elsewhere;
• schools not opening? pain mostly self-inflected
• CNBC talking head: we're seeing the beginning of the end of supply shortages
• were you aware that the ports of Los Angeles and Long Beach pretty much shut down on weekends? again, a lot of the supply chain shortages were self-inflicted
• four million "would-be" workers are staying home each month to care for a family member with "Covid"
• faux environmentalists: created a manufactured natural gas shortage for folks in the northeast; no one seems to care -- yet.
• the supply chain shortage: CNBC tracked the Care Bear problem
  

Notes From All Over -- Part 1 -- October 14, 2021

Must read: the facts behind Saudi Arabia's outrageous oil claims. Link to Simon Watkins. Archived.

ISO NE: link here.

• comfortable autumn morning; no weather
• electricity prices spike over $130 / MWh at 5:00 - 6:00 a.m.
• currently running about $75 / MWh
• mix:
• natural gas: 75%
• nuclear: 12%
• "N" total: 87% -- nothing else matters
• expensive hydro being "called in" to back up renewables
• expensive hydro about mating renewables: 6% vs 8%

Market:

• CNBC: Morgan Stanley crushing it
• bank earnings incredible
• this probably explains the Dow action this morning
• that, along, with folks returning to work

Nine dividend stocks to buy and hold forever: US News --

• JPMorgan
• JNJ
• Procter & Gamble
• Coca-Cola
• Verizon
• Cisco
• McDonald's
• Pfizer
• Intel
• comment: to get my interest, current dividends need to be increased significantly

Slawson To Report A Whirlcat Federal Well Today -- October 14, 2021

Note: blogging will be intermittent this morning due to some errands I need to run.

Jobs (yawn):

• first time claims come in well below expectations:
• 293,000 vs 318,000
• apparently those extra benefits finally ran out for a lot of folks 
• futures hold:
• Dow up 280 points; later, about five minutes later -- Dow up over 315 points in pre-market trading; traders like what they see
  
• S&P 500: up 40 points:
• NASDAQ: up 165 points
  

CPI numbers yesterday: I thought it was a pretty investor-positive report yesterday. Steve Liesman called it a "mixed bag." Take out energy and food and numbers didn't look so bad. 

Market: could be huge today. Pre-market trading is surging. No explanation except for one bit of news -- a Republican won a seat in Iowa that been held by a Democrat for decades.

Grinch: Prince William chides billion space race after Blue Origin. Another one who doesn't get it.

Let them eat cake: White House chief of staff tweets that to Americans complaining about high prices, supply chain shortages. Tone deaf but I know what he's saying. All the bad news is on one side of the coin. If all the bad news was on the other side of the coin, it would be much, much worse.

Care Bear: on CNBC a few days ago to report on the supply chain shortages, CNBC chose to follow the Care Bear story. Think about that. That's what's driving CNBC's thinking: a shortage of Care Bears for Christmas. I don't believe CNBC has reported on the 15,000 Haitians that arrived at Del Rio in one five day period a few weeks ago.

Bitcoin: continues to surge. Currently up another $1000 and just broke through the "58-handle moments ago -- trading at $58, 035. Moving very, very quickly in last twenty-four hours.

CNBC: we've talked about this before. Something is happening. No one saw this coming. Bitcoin is surging and the Dow is up over 240 points in pre-market trading and yet CNBC is not providing any analysis. The producers start working the script for any given day two weeks in advance, and then tweak the schedule as the day gets closer. The interviews need to be arranged well in advance. So we will see a lot of "pre-packaged" stories today even as the market surges today (assuming things continue as they are). In addition, WTI has surged another dollar / bbl and no analysis yet. 

Best hours: there are exceptions to the previous observation. The 8:00 - 9:00 a..m. CT hour with David Farber, Carl Quintanilla, and Jim Cramer when they have a casual conversation making for some very good business news to start the day. Also, the Fast Money and Mad Money  segments late afternoons.

But as noted, I will miss much of that today running errands. 

Ten-year Treasury: drops a bit. 

WTI: $81.46

Morgan Stanley:

• beats on both upper and lower lines
• huge beat in security business; "absolutely smashed it"
• EPS: $1.98 vs $1.68
• Revenue: $14.75 billion vs $14.01 billion
• shares up 1.62%
• doubled their dividend this past year
  

Wells Fargo:

Bank of America: strong earnings.

• EPS: 85 cents vs 71 cents
• revenue: $22.87 billion vs $21.8 billion

Bank earnings: many to be announced today.

******************************************
Back to the Bakken 

Active rigs:

$81.46	10/14/2021	10/14/2020	10/14/2019	10/14/2018	10/14/2017
Active Rigs	29	16	58	67	59

One well coming off the confidential list --

Thursday, October 14, 2021: 12 for the month, 12 for the quarter, 236 for the year:

• 37917, conf, Slawson, Whirlcat Federal 4-31-19TFH, the NDIC has not updated the scout ticket. We don't have data for this well, but it appears the daughter wells in this area are going to be so much better than the parent wells.
  

RBN Energy: Mexico's Pacific coast LNG export projects gain traction, part 2. Archived.

For years, industry experts warned that the global LNG market was entering a period of extreme oversupply that would last until mid-decade. And up until late last year, that bearish scenario seemed to be materializing. Global gas prices had fallen as more LNG export capacity came online, and then COVID-19 decimated global markets and caused existing LNG terminals to shut-in production. But just as quickly as it collapsed, the market flipped. 

The world is now left scrambling to secure LNG/gas supply ahead of the heating season and global gas prices have hit record highs in recent weeks, signaling a turbulent winter ahead. 

Suffice it to say, utilities and governments have energy security and reliability on the mind, not just for prompt winter but for the longer term, and that pressure is unlikely to let up anytime soon. That’s brought previously commitment-wary LNG offtakers back to the negotiation table for new LNG export developments — cautiously and with a sharpened focus on de-risking long-term commitments amid heightened uncertainty. One way to do just that is to capitalize on the economic advantages of North America’s Pacific Coast projects. In today’s RBN blog, we continue our series looking at the state of LNG development on the North American Pacific Coast.