Notes From All Over -- Anticipation -- October 27, 2021

Wage inflation: a reader tells me that due to Covid, it's a double whammy for liquor stores. Employees not showing up for work and when they do, hard to come up with cash to pay wages the staff demands. So instead of paying the staff time and a half, liquor store employees are now being paid time and a fifth. Ba-bing.

I Can Boogie, Baccara

Cash flow: It's a fool's errand to try to predict the price of oil but I think it's safe to assume that the next four quarters, to include 3Q21, are going to be huge quarters for oil companies who are unhedged, Link here.

Halloween: every October 31st it's the same ol' thing, a reader reminded me. Mutual funds are closing out their books for the year to give them time to prepare their annual reports. The market could look messy with more volatility than usual. If skittish, simply ignore the market for the next week or so to let the dust settle. 

Supply chain issues: be prepared for this. It won't work for seasonal items like clothes, but it's very possible consumer durable goods could become surprisingly inexpensive and available by this time next year, if not a whole lot sooner. There are more and more stories suggesting that a flood of products could start showing up all at once. Anecdote: some merchants are "over-ordering" items assuming half of what they order will be significantly delayed. If even some of that "over-ordered" stuff starts arriving earlier than expected ... pendulums swing ... this year has been atrocious for those wanting to buy a car ... next year, maybe the other way around ... although with pent-up demand, it could be a wash. 

Ford: I'm still blown away by Ford's 3Q21 after all the supply chain issues. Imagine what Ford could do when things get back to "normal."

Holiday flying: I certainly would not want to be flying around the holidays this year. Way too many uncertainties. I was surprised how busy American Airlines, DFW, Texas, was on a Tuesday, mid-day flight, in late October.

Suncor: still blows me away. To the following add this link.

Suncor: "crushes" it. Link here. And, here. And, here. Reuters:

• Suncor is Canada's number 2 oil and gas producer
• doubles dividend; dividend now at pre-pandemic levels;
• oil price surge powers profit
• net profit: $710 million
• 47 (US) cents
• produced 698,600 boepd (compare with 331,000 boepd for CLR)

*********************************
A Classical Musical Interlude

The Beatles, The Royal Symphony Orchestra

Anticipation -- BR Boxer And Parrish Wells In Pershing Oil Field

BR renewed the permits for the Boxer and the Parrish permits, week of October 25, 2021. 

Graphics:

Pad drilling:

• 37921, conf, BR,  Parrish ... Pershing,
• 37922, conf, BR,  Boxstone ... North Fork, 
• 37923, conf, BR,  Boxstone ... North Fork, 
• 37924, conf, BR,  Boxer ... Pershing,

Parent well:

• 17393, 600, BR, Boxer 21-6H, Pershing, t3/10; cum 282K 8/21, guaranteed: the daughter wells will be monster wells compared to the parent well;

• 37929, conf, BR, Parrish ... Pershing,
• 37928, conf, BR, Boxer ... Pershing,
• 37927, conf, BR, Parrish ... Pershing,
• 37926, conf, BR, Boxer ... Pershing,

• 37931, conf, BR, Parrish ... Pershing,
• 37932, conf, BR, Parrish ... Pershing,
• 37933, conf, BR, Parrish ... Pershing,
• 37934, conf, BR, Boxer ... Pershing,
• 37935, conf, BR, Boxer ... Pershing,
• 37936, conf, BR, Boxer ... Pershing,

• 37938, conf, BR, Parrish ... Pershing,
• 37939, conf, BR, Boxer ... Pershing,
• 37940, conf, BR, Boxer ... Pershing,

The Rink and Kermit wells are tracked elsewhere.

• 37878, conf, BR, Rink ... Pershing,
• 37879, conf, BR, Kermit... Pershing,
• 37880, conf, BR, Rink ... Pershing,
• 37881, conf, BR, Kermit... Pershing,
  

******************************
Anticipation

Anticipation, Carly Simon

They Say Daughter Wells Not As Good As Parent Wells; Note The Halo Effect -- October 27, 2021

Today's daily activity report: three DUCs reported as completed:

• 37790, 2,679, MRO, Kulland USA 41-4TFH, Reunion Bay, first produced, 5/21; t--; cum 107K 8/21;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	31	28710	28596	31136	46791	44402	622
BAKKEN	7-2021	31	24482	24517	31784	29560	27288	801
BAKKEN	6-2021	30	25541	25587	35602	30032	17366	11156
BAKKEN	5-2021	21	27874	27548	46712	30477	28536	26

• 37791, 3,748, MRO, Lindley USA 41-4H, Reunion Bay, first produced, 5/21; t--; cum 177K 8/21;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	31	29591	29631	23871	49453	47214	412
BAKKEN	7-2021	31	41016	41278	27173	61756	57297	1941
BAKKEN	6-2021	30	61289	61146	44483	73945	42727	27588
BAKKEN	5-2021	23	45212	44683	45646	49881	46760	402

• 37799, 4,604, MRO, Gracie USA 11-3TFH, Reunion Bay, first produced, 5/21; t--; cum 171K 8/21;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	31	23425	23332	19412	44153	42227	229
BAKKEN	7-2021	31	34729	34936	25258	54569	52259	0
BAKKEN	6-2021	30	52408	52193	38722	63267	59991	0
BAKKEN	5-2021	28	59991	59690	58144	62276	58442	201

Parent well:

• 18191, 613, MRO, Raymond USA 41-4H, Reunion Bay, t12/09; cum 417K 8/21; 5,000 bbls over 15 days extrapolates to 10,000 over 30 days;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	31	4533	4520	6363	3435	3378	43
BAKKEN	7-2021	31	4389	4433	6090	3311	3197	99
BAKKEN	6-2021	30	8063	8035	9018	5708	3720	1965
BAKKEN	5-2021	15	5153	5101	8706	3991	3971	0
BAKKEN	4-2021	3	88	112	30	163	136	26
BAKKEN	3-2021	0	0	0	0	0	0	0
BAKKEN	2-2021	5	163	345	42	330	313	17
BAKKEN	1-2021	31	1650	1679	304	2533	2436	0
BAKKEN	12-2020	31	2113	2062	353	2209	2079	8
BAKKEN	11-2020	30	1823	1830	404	801	597	98
BAKKEN	10-2020	25	1435	1381	311	1035	937	1

The other two wells on the Gracie USA pad:

• 37800, drl/NC, MRO, Flagg USA 11-3H, Reunion Bay, first production, 5/21; t--; cum 171K 8/21;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	28	21812	21746	15632	34891	32732	758
BAKKEN	7-2021	31	34152	34246	20135	53960	51622	226
BAKKEN	6-2021	30	56139	56040	30358	70256	66917	0
BAKKEN	5-2021	27	58495	58053	42067	60178	56725	0

• 37801, drl/NC, MRO, Brusseau USA 11-3TFH, Reunion Bay, first production, 4/21; t--; cum 130K 8/21;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	8-2021	31	21367	21230	22211	31670	29754	558
BAKKEN	7-2021	31	27871	27820	29497	35481	33698	98
BAKKEN	6-2021	30	32563	32564	33582	39112	37182	0
BAKKEN	5-2021	30	41749	42116	55769	43482	41015	0
BAKKEN	4-2021	5	6491	5809	12412	5907	5510	0

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Save Your Tears

We moved every two to three years during my thirty years and a day with the US Air Force. I often associated a single song with any geographical location. We currently live in a most wonderful apartment complex northwest of Dallas, TX. It has two swimming pools and during the summer, I generally have either of the pools to myself during the early morning hours. It just so happens this song was the "hit" song that played over and over at the pool this past summer. This will be the song that will always remind me of where we lived during the year of the plague.

Save Your Tears, Weeknd

Three MRO DUCs Reported As Completed; BR Renews Permits For A 10-Well Pad -- October 27, 2021

Suncor: "crushes" it. Link here. And, here. And, here. Reuters:

• Suncor is Canada's number 2 oil and gas producer
• doubles dividend; dividend now at pre-pandemic levels;
• oil price surge powers profit
• net profit: $710 million
• 47 (US) cents
• produced 698,600 boepd (compare with 331,000 boepd for CLR)
  

Covid vaccine rollout: holy mackerel. Greatest number of vaccines given in 24 hours hits new record. Recorded over one million vaccinations being given in past 24 hours.

F: Ford stock jumps on 3Q21 earnings beat; guidance boost, dividend reinstated; much stronger-than-expected set of 3Q21 earnings. Yesterday, called it. See this post.

GM: profit sinks. Blame it on the semiconductor shortage.

Natural gas: up another 34 cents; closed at $6.22 / MMBtu.

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

Active rigs:

$82.06	10/27/2021	10/27/2020	10/27/2019	10/27/2018	10/27/2017
Active Rigs	29	14	57	67	53

No new permits.

Ten permits renewed:

• BR (10): a ten-well pad in lot 2 section 6-149-96; Parrish - Boxer

Three DUCs reported as completed:

• 37790, 2,679, MRO, Kulland USA 41-4TFH, Reunion Bay, see this note;
  
• 37791, 3,748, MRO, Lindley USA 41-4H, Reunion Bay, see this note;
• 37788, 4,604, MRO, Gracie USA 11-3TFH, Reunion Bay, see this note;

Dashboards Posted -- For The Archives -- October 27, 2021

Dashboards posted:

• EIA pdf, Bakken: https://www.eia.gov/petroleum/drilling/pdf/bakken.pdf
• EIA, pdf, Permian: https://www.eia.gov/petroleum/drilling/pdf/permian.pdf
• EIA, pdf, Eagle Ford: https://www.eia.gov/petroleum/drilling/pdf/eagleford.pdf

Gasoline demand: link here.

PSX to acquire PSXP: link here.

Cushing: relax. We've been here before. EIA data. And, here.

Derivative loss, hedging: Range Resources. 

Chinese oil inventory: finally, some numbers.

China: coal, longer. Greta better get used to it.

China: rationing diesel at the corner service station.

Japan: more natural-gas-to-oil switching.

California: gasoline demand destruction. Rest of country looked "good" but California sales way down, leading to this:

Looks like folks won't buy $5-gasoline if they don't have to.

Equinor: boosts share buybacks after 3Q21 profit boost. 

MCD: McDonald's up 3%; up $7; trading at $243+. Beats and raises sales forecast.

Hertz: following 100,000-car deal with Tesla, links up with Uber to offer 50,000 Tesla rentals. It's very likely I would rent a Tesla for a day just for the fun of it.

**********************************
I Can Boogie Baccara

Soap And The Bakken -- October 27, 2021

This was posted in The Williston Herald while I was traveling; noted by a reader. 

This story also reported by AP.

A pilot project in North Dakota is testing whether sending a substance with the consistency of maple syrup down oil wells will help increase production.

The process involves combining so-called biosurfactant with water and pumping the mixture into wells where it will reach cracks in the rock formed when the oil is extracted by fracking. The goal is to reduce the attraction between rock and oil in order to recover more crude.

If successful it could also benefit North Dakota farmers because materials such as canola oil and sugar beets facilitate the fermentation process necessary to create the biosurfactant.

It's interesting the writer focused on the "consistency" of the product. I'm not sure that helps me understand "biosurfactant."

For me, "surfactant" = soap.

From wiki:

Surfactants are compounds that lower the surface tension (or interfacial tension) between two liquids, between a gas and a liquid, or between a liquid and a solid. 

Surfactants may act as detergents, wetting agents, emulsifiers, foaming agents, or dispersants. The word "surfactant" is a blend of surface-active agent, coined c.  1950.

In neonatal ICUs, surfactant became a game changer, back in the 1970s, I suppose, for treating infants born prematurely. Humans produce a natural surfactant which allows the microscopic air sacs (alveoli) to expand -- think of the difficulty of blowing up a previously inflated balloon that has become damp; almost impossible to re-inflate. Surfactant (soap) helps re-inflate the collapsed rubber balloon. But for humans, that natural surfactant is not produced in large volumes in babies born before thirty-four gestation, or thereabouts.

Full term infants are estimated to have an alveolar storage pool of approximately 100 mg/kg of surfactant, while preterm infants have an estimated 4–5 mg/kg at birth. Wiki. 

When I began training, pediatrician / neonatologists would administer artificial surfactant to pre-term infants after the infants had been moved from the delivery room to the neonatal ICU (NICU). Now, obstetricians administer that surfactant to the premie in the delivery room often simultaneous with the neonate's first breath. Made all the difference in the world. Quite remarkable. 

Back to the Bakken. The companies involved:

• Locus Bio-Energy Solutions, based in Woodlands, TX; and,
• Creedence Energy services, based in Minot, ND

Of note:

The companies believe that the small size of the biosurfactant is the reason this product works so well. While DNA is 2.3 nanometers thick, the Creedence-Bio Locus surfactant is smaller still, at 1.2 nanometers.

More at the link.

Notes From All Over -- Off The Net For Awhile -- Traveling -- October 27, 2021

Commentary: I'm not exactly sure where I am mentally. By that I mean, I'm not exactly sure what I want to focus on today or this week for that matter. It's been an incredible couple of weeks and this week has a slew of US companies reporting their 3Q21 earnings. 

It's a bit difficult to report on what's happening in the Bakken. With the NDIC reporting issues it's hard to know what's accurate, what's not, what's current, what's not. 

On tap today ... oh, fantastic ... I had forgotten -- the weekly EIA petroleum report. 

• US crude oil in storage increased by 4.3 million bbls; remember, 1.1 million bbls came from the SPR, I am told; needs to be fact-checked;
• US crude oil in inventory now stands at 430.8 million bbls; 6% below the already-fat five-year average;
• US refiners are operating at 85.1% of their operable capacity; it must be perplexing to understand why refiners aren't doing more; they must be making tons of money off $5-oil;
• US crude oil imports in line with past weeks (yawn)
• distillate fuel inventories pretty much flat and still 8% below five-year average
• jet fuel supplied as up 44.9% compared with same four-week period last year; too back they don't compare 2021 with that of 2019;

Meanwhile:

• US crude oil, days supply: remains in narrow range, at 27.9 days now.
• US: crude oil imported from Saudi Arabia: for most recent month for which we have data, July, 2021, lowest amount ever imported from Saudi Arabia for the month of July.
• market, opening: taking a breather after setting records yesterday, but let's see some of the headlines:
• 3Q21 earnings are a surprise on the upside;
• the Tesla-Hertz deal is a win-win for everyone (I agree completely);
• MSFT: shares up after company reports strong earnings; pressure is now on AAPL to deliver;
• twitter sees growth despited Apple changes re: privacy
• no labor shortage at Costco (previously reported)
• selected ticker symbols:
• UNP: one word, amazing, up another $1.67 today;
• SRE: down 0.2%
• AAPL: flat, specifically, down 9 cents  or 0.05%;
• OKE: down 13 cents or down 0.15%
• that's enough to tell me where energy is headed today

North Dakota in the news again. See this over at the weekly CDC "flu" update.

Two human infections with novel influenza A viruses were reported. One infection with an influenza A(H1N1) variant (A(H1N1)v) virus was reported by North Dakota that occurred during the 2020-21 influenza season and one infection with an influenza (A(H3N2)v) virus was reported by Ohio that occurred during the 2021-22 influenza season. Both patients are <18 years of age, were not hospitalized, and have recovered or are recovering from their illness. One of the patients had close contact with swine prior to illness onset. The other patient had no known swine contact or attendance at agricultural exhibits where swine were present; it is possible that limited human-to-human transmission occurred. No ongoing human-to-human transmission has been identified associated with either patient.

When an influenza virus that normally circulates in swine (but not people) is detected in a person, it is called a “variant influenza virus”. Most human infections with variant influenza viruses occur following close proximity to swine, but human-to-human transmission can occur. It is important to note that in most cases, variant influenza viruses have not shown the ability to spread easily and sustainably from person to person.

Weekly "flu" update: same link as above. Mostly a yawner. "Flu" is minimal right now; 

Covid - US: link here.

Covid - UK: link here. Amazing -- look at "cases" vs "deaths."

CLR: 3Q21 Earnings -- Re-Scheduled For November 3, 2021 -- Posted October 27, 2021

CLR is tracked here. I see I also link CLR at the sidebar here.

3Q21 earnings, press release.

Look how CLR manages their assets. 

Some highlights from the press release:

• record free cash flow: 
• cash flow: $1.02 billion
• free cash flow: $669 million
  
• production:
• 331.4  MBoepd
• 157.2. MBopd
  
  
  
• natural gas: 1,046 million cfpd = 174,304 boepd
• oil / total production = 47%
• "We have elected to continue focusing on natural gas development in Oklahoma based on favorable market conditions. This resulted in an approximate 80 MMcfpd increase in natural gas and 4 MBopd reduction in oil to third quarter 2021 production results in Oklahoma vs. prior projections. Additionally, in support of our industry-leading ESG gas capture stewardship in the Bakken, we voluntarily curtailed an incremental 3 MBopd in third quarter 2021 during unplanned midstream outages," 
• re-schedules 3Q21 earnings release to November 3, 2021, after market close;
  

Wow, Wow, Wow -- What A Treat -- The Great American West -- October 27, 2021

A reader sent me the link to this story. I haven't read the article, but I've scanned through the photos. Wow, what a treat. 

The link to this story: https://www.breitbart.com/politics/2021/10/26/exclusive-interview-watch-buffalo-wrangling-kristi-noem-takes-on-her-critics-exposes-the-biden-agenda-and-celebrates-the-american-west/. 

What incredible photographs. Enjoy.

It will be interesting to see if the British newspapers -- which love this sort of thing -- pick up on this story and run their own photo essay. I hope so.

Three Wells Coming Off The Confidential List -- October 27, 2021

Cost of renewable energy: Xcel, in my mind, is one of a handful of utility companies that could vie for "Poster Child For Renewable Energy" and the promise to keep rates low. 

So, how's that renewable energy working out? Pretty good for the utility, it appears. Maybe not  so good for the consumer. Xcel seeks 20% rate increase over three years. Link here. I haven't read the article. Let's see what MPR says this is all about? 

Yup, there it is: costs related to renewable energy. It appears the company needs to build more transmission lines to where the renewable energy farms are located. 

An additional $20 / month at the end of three years. Seems like a small price to save the world.

ISO NE: the usual spike this a.m. Spikes to $70; now as bad as often seen. Mix: renewables, 14%; nuclear 12%. 

Solar power: major cost increase could threaten industry in 2022. Normally I wouldn't post this coming from oilprice but in this case the source is well respected, Rystad Energy.

McDonald's: pre-market trading, surges. Earnings crush expectations. Link here.

Google: crushed earnings. Link here.

WTi: I admire RBN Energy for tackling this issue. See below.

Railroads: we should start seeing articles in business outlets that some cargo ships previously destined for southern California will be re-routed to ports in Oregon, Washington state, and through the Panama Canal to South Carolina and Florida.

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

Active rigs:

Three wells coming off confidential list:

Wednesday, October 27, 2021: 25 for the month, 25 for the quarter, 248 for the year:

• 36931, conf, Rimrock Oil & Gas, FBIR Guyblackhawk 24X27G, Heart Butte, first production, 7/21; t--; cum 17K 8/21; the Guyblackhawk wells are tracked here;
  
• 36930, conf, Rimrock Oil & Gas, FBIR Guyblackhawk 24X-27C, Heart Butte, another huge well, first production, 7/21; t--; cum 45K 8/21; the Guyblackhawk wells are tracked here;
• 36770, conf, Hess, BL-A Iverson-155-96-1312H-8, Beaver Lodge, first production, 4/21; t--; cum 90K 8/21;

RBN Energy: are we headed for $100 crude oil? And then what?

Crude oil prices continued to increase this week, with WTI at Cushing closing Tuesday at $84.65/bbl, the highest level since October 13, 2014. The rise in crude since the spring of 2020 has been swift and almost relentless, interrupted only by pauses at $40, $60, and $70, when the market took breathers and seemed to say to itself, “We’re not done yet, right?” The question now is, can anything stop WTI from topping $90 and yes, the magic $100 mark — something that few would have predicted we’d see again so soon . The reality is, there are many factors driving crude prices higher but few holding prices down. In today’s RBN blog, we discuss what’s driving the rapid run-up in oil prices, whether $100/bbl WTI is a sure thing, and what happens if — when? — oil hits triple digits.

Traveling -- Blogging Significantly Delayed -- Wednesday, October 27, 2021

Huge apology to all the folks who have written / submitted comments: I'll get to them as quickly as possible. Traveling this week; everything delayed. 

Active rigs:

$83.68	10/27/2021	10/27/2020	10/27/2019	10/27/2018	10/27/2017
Active Rigs	29	14	57	67	53

Four new permits, #38626 - #38629:

• Operator: Whiting
• Field: Sanish (Mountrail)
• Comments:
• Whiting has permits for four wells to be sited in lot 4 section 4-153-91; the wells will be sited 995 FNL and 1130 FNL and 340 FWL;

Four permits renewed:

• BR: two Boxer permits and two Parrish permits, all in Williams County

Six permits canceled:

• EOG: six Clarks Creek permits, all in section 8-151-94;

One producing well (a DUC) reported as completed:

• 37854, 1,133, CLR, Carus 14-28H1,