ND Active Rigs More Than Doubled Year Over Year; One Well Coming Off Confidential -- December 14, 2021 - December 15, 2021

NYC to ban natural gas in new buildings: link to Reuters here. 

A shale comeback in the cards for 2022? Link to David Messler, another of the handful of columnists following the Bakken that is credible and interesting.

Masking: Apple once again requiring masking at all locations in the US.

CarPlay: all-new Golf GTI and Golf R headline VW's 2022 lineup with wireless CarPlay. Link here. 

WTI: slips below $70. Someone remarked we've flipped from backwardation to contango this week. I do not know. 

Permian just keeps on trucking: see RBN Energy below. 

Note: Brandon administration says "banning oil exports is off the table." And Secretary of Energy tells oil companies to "drill, baby, drill." When asked about the rig count her reply: "I don't have the numbers in front of me."

Jet fuel: inventories / storage at levels not seen since 2014 - 2015. Less production and more demand have significantly decreased stores. Link here to EIA graph.

Tesla and the infamous "McNeally Quote": link here. It doesn't mean a thing to me; I have no dog in this fight, but the "history" is interesting, and worth it to have in the archives for the grandchildren (for some odd reason, I suppose).

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Back to the Bakken

Active rigs:

$69.85	12/15/2021	12/15/2020	12/15/2019	12/15/2018	12/15/2017
Active Rigs	32	14	53	67	53

Wednesday, December 15, 2021: 69 for the month, 72 for the quarter, 324 for the year:

• 38187, conf, CLR, Tallahassee FIU 5-21H,

RBN Energy: Permian gas production spurs still more infrastructure projects. Archived.

In early December, natural gas production in the Permian has been averaging a record 14.2 Bcf/d, a gain of 1 Bcf/d in only six months. That rapid pace of growth is putting pressure on every aspect of midstream infrastructure — gas gathering systems, processing plants, and takeaway pipelines — and resulting in a variety of efforts aimed at ensuring there will be sufficient capacity in place to support the increasing gas volumes being produced. New gas-gathering mileage is being added, some new processing plants are being built, and at least a couple of new large-diameter pipelines from the Permian to the Gulf Coast are being considered. However, reflecting the midstream sector’s financial discipline, there’s also a big push to make fuller use of existing assets, in some cases by relocating processing plants, compressors, and other assets to where they are needed most. In today’s RBN blog, we discuss the latest gas-related infrastructure developments in the Permian’s Midland and Delaware basins.

As we said a few months ago, Permian natural gas production has roughly doubled in the past four years, spurring the build-out of billions of dollars in gas-related assets. These projects include innumerable miles of new gathering pipeline, more than new 50 gas processing plants, and a number of new takeaway pipelines, most recently the 2.1-Bcf/d Permian Highway Pipeline and the 2-Bcf/d Whistler Pipeline, which started up in January and July of this year, respectively.

Only His Barber Knows For Sure -- Connecting The Dots -- December 14, 2021

Updates

Later, 10:06 p.m. CT: this is simply a coincidence. I posted the note below, then going through my twitter feed one last time for the day, I came across this:

Original Post

In the big scheme of things, I don't know how much electricity, in a relative sense, that a "giga-battery-factory" requires, or how much electricity an auto manufacturer needs, but I assume it's not trivial. 

Hold that thought.

It seems the "big" reason that Elon Musk / Tesla left California had to do with taxes and "politics." 

But one wonders to what extent accessible, dependable, inexpensive, dispatchable electricity played a role. 

I was reminded of that today when a reader mentioned in passing that PG&E's plans to shut down Diablo Canyon nuclear plant beginning in 2024 are still on track. 

• Wiki entry.
• Is California prepared, May 18, 2021?

This nuclear plant is the largest single power station in the state.

It went into operation in 1985 /1986 -- almost forty years ago and had at least another forty years of "life."

The plant produces electricity for about 6 cents per kWh, less than the average cost of 10.1 cents per kWh that PG&E paid for electricity from other suppliers in 2014.

A 2021 report from researchers at MIT and Stanford states that keeping Diablo Canyon running until 2035 would reduce the state's carbon emissions from electricity generation by 11% every year, save the state a cumulative $2.6 billion, and improve the reliability of the grid. 

They state that three factors have changed since the 2018 decision to close the plant: the state passed a new law (sb100) which requires 100% emissions-free electricity generation by 2045, the whole western US region is in a continuing mega-drought (limiting hydroelectric generation), and demand for electricity has outpaced supply, especially during heatwaves. 

They also stated that keeping Diablo operating until 2045 would save the state a cumulative $21 billion.

For more:

• See this post from October 17, 2021.   
• Perhaps the first blog post on this issue, June 21, 2016.

The best comparison I have is ISO New England where nuclear energy still plays a significant role, providing about 25% of electricity demand.

Only In America -- December 14, 2021

Only in American could this be "intimidating." I can't make this stuff up. 

From The Bismarck Tribune:

Three New Permits; Rimrock Renews Two Permits -- December 14, 2021

Hydrogen: link to Felicity Bradstock -- middle East oil giants, Saudi Arabia and UAE, are battling for hydrogen supremacy. 

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Back to the Bakken

Active rigs:

$70.29	12/14/2021	12/14/2020	12/14/2019	12/14/2018	12/14/2017
Active Rigs	32	15	53	67	52

Three new permits, #38699 - #38701, inclusive:

• Operators: CLR (2); Summit Carbon Solutions
• Fields: Beaver Lodge (Williams); Wildcat (Oliver)
• Comments:
• Summit Carbon Solutions has a permit for a development well, a Slash Lazy well in lot 1 section 6-142-86; to be sited 1122 FNL and 932 FEL;
• CLR has permits for two Gibb wells (the brothers Gibb?); to be sited in SESE 24-156-95; to be sited between 337 and 382 FSL and 300 FEL;

Two permits renewed:

• Rimrock: a Boardslide permit and a Nollie permit, both in Dunn County

Five  permits canceled:

• CLR: five Gibb wells (the brothers Gibb?), NESE/SESE section 24-156-95; Williams County;

Three producing wells (DUCs) reported as completed:

• 37378, 1,584, Rodney 7-29H, Cedar Coulee, first production, 8/21; t--; cum --;
• 37397 1,358, Rodney 10-29H1, Cedar Coulee, first production, 9/21; t--; cum --;
• 37941 1,406, Bang 3-33H1, Cedar Coulee, first production, 9/21; t--; cum --;

"How About .... fill in the blank..." December 14, 2021

Link here.

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Flipped

Link here.

This clearly says in plain English:

• there will be a glut of oil in first quarter, 2022
• prices will be higher in 2022 than they are now

Covid: Biggest Rise In Life-Insurance Payouts In A Century -- December, 2021

It seems there were reports last  year that although Covid-19-related deaths were huge, the overall "excess" deaths in 2020 were flat or even possibly lower than previous years. 

Whatever.

Here's the data. Or least what's being reported.

From The WSJ:  

Covid spurs biggest rise in life-insurance payouts in a century. Death-benefits payments jumped 15% last year, biggest increase since 1918 flu epidemic. 

From JAMA: 

A study analyzing US mortality in March-July 2020 reported a 20% increase in excess deaths, only partly explained by COVID-19. Surges in excess deaths varied in timing and duration across states and were accompanied by increased mortality from non–COVID-19 causes. This study updates the analysis for the remainder of 2020.

Let's Go Brandon -- Price Of Gasoline -- EIA -- December 14, 2021

Apparently for gasoline, that jump in price was "transitory." The price of gasoline is already falling. LOL.

Link here. 

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A Musical Interlude

I Get Around, The Beach Boys

Spare Capacity Talk: Numbers Starting To Come In -- December 14, 2021

What we've added to the "2022" list of things to follow: includes "spare capacity."

Link here.

Tuesday, December 14, 2021

PPI (producer price index):

• up 0.8% vs 0.5% forecast
• excluding food and energy; up 0.7% vs 0.4%
• up almost 10% year over year: up 9.6% November
• have to go all the way back to 1980 see numbers like this
• still a lot of talk about unloaded cargo ships
  

First group "financial / economic" indicators:

• 10-Year Treasury: link here. 1.438%.
• DXY: link here. 96.20.
  
• Silver: link  here. 22.115.
• CBOE volatility index: link here. Explained at Investopedia. 20.83.

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Daydream Believer

Daydream Believer, The Monkees

Different Drum, Linda Ronstadt

Hotel California, The Eagles

No Wells Coming Off Confidential List -- December 14, 2021

Reminder: NDSU, SDSU, Montana State and some other team in the semifinals this Friday, Saturday for college football championship. 

Rumor: New Zealand to market combo pack just in time for Christmas -- the new Pfizer capsule along with Viagra. My hunch: they throw in a Trojan for marketing. 

Speaking of dividends: yesterday we noted UNP and TRN raised their dividends. It must have been a big story. See Zacks and here. 

Solar power: California re-thinking rooftop solar panel subsidies. Consider the source. 

Contrary view: oil patch supply will catch up with demand in 2022 -- S&P Global Platts -- link to Charles Kennedy -- one of the better columnists.

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Back to the Bakken

Active rigs:

$71.56	12/14/2021	12/14/2020	12/14/2019	12/14/2018	12/14/2017
Active Rigs	32	15	53	67	52

No wells coming off confidential list.

RBN Energy: new Vopak Moda Houston terminal anticipates growing role for ammonia. Archived.

There’s been a lot of talk lately about “green” and “blue” hydrogen becoming increasingly important players in the world’s lower-carbon energy future. Green and blue ammonia too, given that ammonia, with its high hydrogen content, is an efficient “carrier” of hydrogen when it needs to be delivered by ship, railcar, or truck. Also, ammonia itself — like hydrogen — can be used to power fuel cells and ammonia-combustion technology is being developed to use fuel ammonia at power plants.

But for these low- or zero-carbon energy products to be adopted at a global scale, new infrastructure will need to be built, not only to enable their production and consumption but to transport them to where they’ll be consumed. Enter the just-finished ammonia terminal that Royal Vopak and Moda Midstream jointly developed at a prime site along the Houston Ship Channel. In today’s RBN blog, we discuss the greenfield facility and its prospective role as a major import/export hub for ammonia.

Global decarbonization has become a frequent topic in our blogs. It’s not that we think crude oil, natural gas, and NGLs will be fading from view anytime soon — or in our lifetime, for that matter. But we acknowledge the pressure to reduce greenhouse gas (GHG) emissions as quickly as possible, and we believe that while the energy industry — all of it, from producers and midstreamers to refiners and power producers — will need to undergo a major transformation, change presents opportunity and if we’re smart we’ll recognize it and grab it.