Clearing Out The In-Box -- May 10, 2022

Tom Brady:

• after retirement (2045) he will be lead NFL analyst for Fox Sports
• record-breaking contract: $375 million for ten years

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Putin's War

Russia, post Putin's War

• The war: a race against time.
  
• Russian economy will implode summer of 2022.
• Inevitable decline of its oil industry.  
• Putin's War will set back Russia fifty years. 

GPS: your teenage daughter has better GPS capability with her smartphone than Russian pilots

• hardware: Russia can't keep up with its losses; posted previously

• May Day parade: obviously short of tanks

Remember: global GPS -- managed by USAF.

Ukraine: 

• has captured more Russian tanks -- many of them still operational -- than Germany has in entire Germany Army

US:

• US senior staff colleges will be studying this war for a long time
• Russia: trained for defensive warfare, not offensive
• senior officers killed because senior NCOs not trained to make decisions in the field; very different from US

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Energy Transition

Transition: it's possible this will speed up transition to renewable energy; that's the debate. If money were not object, then renewable energy might be "winner" coming out of Putin's War -- but "time" and "money" are working against renewable energy. Me? US LNG is the big winner.

Twain's Mustache: one of a handful of analysts I trust / follow on my twitter feed, link here:

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Global Energy

The fundamentals aren't making sense -- unless one thinks the coming recession will end demand for oil once and for all as we know it.

Spare capacity: 

• Peter Zeihan:

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EU - NATO - ETC

Some think Putin's War will hasten break-up of NATO, EU, etc.

• won't happen; if anything, NATO, EU become stronger
• still looking for next EU / NATO spokesperson; quick, name NATO’s top general.
• my nominee: Zelenskyy (or however you spell his last name)
• no can can name head of EU, NATO, etc, but everyone knows who's running Ukraine and the war against Putin

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EVs

Some serious meetings this month after the Rivian-Ford and the Rivian-Amazon debacles.

• it's all about cash
• Tesla is now free cash flow positive (some question that);
• spent $9 billion, 2007 - 2019
• now, free cash flow positive, generating $2 billion to date
• Rivian? Link here.

Ford: huge deal

• United Rentals will buy 500 Ford F-150 Lightning electric trucks, 30 electric Transit vans; link here.
• who cares?
• at the close today, F was trading at $13.35, down another 20 cents; the bleeding has not stopped
• in past six months, F has lost 32% (share price); YTD down almost 40%; okay.
• Ford will sell all it can make, bu how many can it make and how fast?
• and margins?

• GM? Berenberg analyst likes GM along with some European auto makers
• "lukewarm" on Ford and Tesla; 
• The big question: who does Cathie Wood (ARKK) like? Link here.
  she sold "some" Tesla and bought "some" GM
  

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The Literary Page

Fifty best horror books of all time.

Link here. 

Stephen King with at least four.

#1: IT by Stephen King.

#4: The Shining by Stephen King. 

#9: Dracula by Bram Stoker.

#10: Frankenstein by Mary Shelley

#22: Pet Sematary by Stephen King.

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A Musical Interlude

Elenore or Happy Together?

Elenore, The Turtles

NDIC Not Providing Bakken Data -- May 10, 2022

What we're missing:

• daily activity report
• monthly hearing dockets

This blog depends on daily activity report from NDIC. Without the daily report, this blog is hardly necessary.

NDIC daily report not available:

• Monday, May 9, 2022
• Tuesday, May 10, 2022

See sidebar at the top.

I am very unhappy with the blog. To make it worthwhile, the blog needs data from the NDIC oil and gas website. 

But we move on.

I took the blog down because I thought it irrelevant and superfluous without the NDIC data. 

But too many readers suggested I post regardless, so we're back to where we were yesterday. 

Thank you for understanding. And your patience. It can hardly get worse.

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WWII and Nylon Stockings

Older folks will know what I'm talking about when I mention "WWII and nylon stockings."

Fast forward. 2022. 

It's bacon.

Seriously. 

For first time in several weeks, I took la jefa out to brunch. As a side order, I got "million-dollar-bacon" -- four slices for $5.49 or $5.99, I forget. 

I ate two slices and saved two slices for later. 

Tonight, our daughter, Sophia's mother gave me six slices of bacon from some "uber-eats" thing. She doesn't eat bacon but knew that I love bacon. So, I have bacon for the next several days if carefully rationed. 

What a great country. At "First Watch," la jefa had eggs benedict, salad, and all the trimmings. Me? A bloody Mary, an English muffin, and the aforementioned bacon.

OXY

1Q22. 

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Original OXY Post

Occidental (OXY -- alphabetized as "OXY") (OXY is now tracked here)

• October, 2015: announced; sold 300,000 Bakken acres for $500 million to Lime Rock Resources; 346 wells transferred, more than any other company in 2015;
• October, 2014: shopping its 335,000 Bakken acres for $3 billion
• January, 2013: Director, NDIC, says Burke County is edge of the Bakken; said major operator in Burke likely to pull out (in Burke County: OXY USA, Oasis, CLR, Cornerstone) 
• 2Q12 conference call: CEO did not know for sure, but thought it was 300,000+ net acres in the Bakken
• 277,000 net acres at end of 2011; 200,000 net acres earlier in 2011;
  
• Occidental bought Anschutz Bakken acreage in late 2010 (180,000)
• Prior to the acquisition, held 20,000 acres (by my reckoning -- I could be wrong) 
• Anonymous says OXY has two dedicated frack spreads
• 15 rigs, January, 2012; 13 rigs, February, 2012, but company says it expects to have 6 rigs by end of 2012; so this must be company-owned rigs vs contracted rigs?

OXY -- 1Q22 Results -- EPS -- A Huge Beat

OXY is now tracked here.

Press release for 1Q22 earnings.

Other links regarding earnings:

• forecast: "Zacks Consensus Estimate for 1Q22 is pegged at $1.97 which reflects a whopping year-over-year growth of 1,413.3%. Actual: earnings peer diluted share of $4.65 and adjusted earnings peer diluted share of $2.12.
  

From the press release:

Highlights

• Repaid $3.3 billion of debt, representing 12% of total outstanding principal
• Earnings per diluted share of $4.65 and adjusted earnings per diluted share of $2.12
• Cash flow from continuing operations of $3.2 billion and cash flow from continuing operations before working capital of $4.2 billion
• Capital spending of $858 million, resulting in record quarterly free cash flow before working capital of over $3.3 billion
• OxyChem generated record quarterly pre-tax earnings of $671 million; total year pre-tax earnings guidance increased to between $2.1 billion to $2.4 billion 
• Midstream exceeded quarterly guidance with adjusted pre-tax earnings of $148 million; total year pre-tax earnings guidance increased to between $175 million to $275 million

Oxy announced net income attributable to common stockholders for the first quarter of 2022 of $4.7 billion, or $4.65 per diluted share, and adjusted income attributable to common stockholders of $2.1 billion, or $2.12 per diluted share, compared to net income attributable to common stockholders for the fourth quarter of 2021 of $1.3 billion, or $1.37 per diluted share, and adjusted income attributable to common stockholders of $1.4 billion, or $1.48 per diluted share. 

First quarter after-tax items affecting comparability of $2.5 billion included a non-cash tax benefit of $2.6 billion related to a post-Anadarko acquisition reorganization of legal entities, $98 million of gains related to the sale of non-core domestic onshore oil and gas leases, partially offset by $49 million of derivative losses and $51 million of Anadarko acquisition-related costs. 

Oil and gas pre-tax income on continuing operations for the first quarter of 2022 was $2.9 billion, compared to pre-tax income of $2.1 billion for the fourth quarter of 2021. 

The first quarter of 2022 oil and gas income included $125 million of pre-tax gains related to the sale of non-core domestic onshore oil and gas leases. 

Excluding items affecting comparability, first quarter of 2022 oil and gas income improved over the fourth quarter of 2021 due to higher crude oil prices and lower depreciation, depletion and amortization rates, partially offset by lower sales volumes. 

For the first quarter of 2022, average WTI and Brent marker prices were $94.29 per barrel and $97.36 per barrel, respectively. 

Average worldwide realized crude oil prices increased by approximately 22 percent from the prior quarter to $91.91 per barrel. Average worldwide realized natural gas liquids (NGL) prices increased by approximately 8 percent from the prior quarter to $39.61 per barrel. 

Average domestic realized gas prices decreased by approximately 10 percent from the prior quarter to $4.17 per Mcf. 

Total average global production of 1,079 thousand of barrels of oil equivalent per day (Mboed) for the first quarter of 2022 was within guidance. 

Permian and Rockies exceeded or came in at the high end of guidance, with average production of 472 Mboed and 286 Mboed, respectively. 

Gulf of Mexico average production of 138 Mboed was within guidance. International average production volumes were 183 Mboed.

Woke: Too Woke. This Is Beyond The Pale -- May 10, 2022

Link here: https://www.foxnews.com/media/rhode-island-parents-school-board-equity-obsession.

Poorly written story at link but bottom line: prestigious school eliminating IEPs for struggling students and AP / Honors courses for students who excel academically. 

Barrington, RI.

Nationally-ranked high school has dropped from 189th in the nation to 308. 

Needs to be fact-checked. 

Google: 

• The Providence Journal: the school board back-tracks, sort of. Link here.

BARRINGTON — Barrington High School is bringing back a version of honors classes this fall to answer a drumbeat of disapproval from families and students over the last year. 

Principal Joseph Hurley stunned parents Wednesday night when he said the high school was bringing back an honors distinction in English and social studies in September, although the details are still being worked out. 

That infuriated parents who have already gone through at least two versions of the honors designation. Their response to the latest twist was this: bring back the original honors classes, which were open to every student and had widespread participation. 

Hurley acknowledged that the high school didn’t consider the impact of doing away with honors classes would have on students who apply for merit scholarships. 

“That was a game-changer,” he told a packed auditorium. “What wasn’t considered was the impact on financial aid.”  

The school's official re-structuring program. Confirms elimination of honors courses ini English and social studies. 

The S**t Will Hit The Fan In July, 2022 -- May 10, 2022

Warnings are coming in from everywhere:

• Texas: rolling blackouts in Austin, May 9, 2022, extreme heat overwhelms grid;
  
• California: governor says California doesn't have enough electricity to keep the lights on;
  
• OPEC comments on space capacity: it ain't there;
  
• OPEC falters: production coming in under quotas;
  
• Russian's energy minister Novak spinning his story: production stabilizing; let's see what happens six months from now;
  
• US equity markets: plunges
  

Spare capacity:

• clearly the big story of the day, link here.
• global alarm, Bloomberg, link here

OPEC:

• Russia production: link to Julianne Geiger.
• OPEC falters: link here.

Clearing Out The In-Box -- May 10, 2022

Fox Sports loves Tom Brady: will join FOX Sports as lead NFL analyst when he retires. 2045. 

US gasoline: retail, hits record -- $4.374.

US market:

• Novavax: reports its first profitable quarter, but the stock sinks (as does the entire market); link here.
  

• Pfizer to buy Biohaven Pharmaceuticals for $12 billion: Biohaven soars. Link here. Barron's here.
• XPO Logistics beat estimates, raised guidance. Link here.  Barron's here.

US LNG:

• FERC extends construction deadlines for two US LNG projects, despite objections -- Reuters, link here.

Spare capacity:

• clearly the big story of the day, link here.
• global alarm, Bloomberg, link here

OPEC:

• Russia production: link to Julianne Geiger.
• OPEC falters: link here.

Mexico:

• energy trade between US and Mexico at nine-year high. EIA. Link here.

Germany:

• in deep doo-doo -- Reuters, without Russian energy.

EVs:

• Tesla: in deep doo-doo? Link here.
• produced 10,757 units in China in April
• that's an 84% drop y/y -- repeating, that's an 84% drop year-over-year:
• wholesale: 1,512 units
• exported zero units; 

The other battery: Energizer. You know, the pink bunny. Link here. 

• profits, sales beat forecasts
• company raises forecast for top-line growth
• one of very few stocks to rise, despite debacle on Wall Street.
• how Mercedes is using this battery. 
  

AAPL: to re-structure its "Services Team.

• will focus on streaming and advertising
• is it time for AAPL to buy DIS?

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Got Milk?

Oat milk vs almond milk.

Bottom line: pretty much interchangeable. Personal choice. Maybe oat milk has the edge. Starbucks can use oat milk; can't use almond milk.

Russia's Production Stabilizing -- Russian Energy Minister -- May 10, 2022

 Link to Julianne Geiger.

Russia’s crude oil production is on the rise so far in May, Deputy Prime Minister Alexander Novak told TASS news agency on Monday.

Russia’s crude oil production slipped by half a million bpd in March, by a full million bpd in April, with many analysts stating concern that those barrels may never return to the market. April’s OPEC+ production quota was set at 10.436 million bpd.

But according to Novak, the picture isn’t quite so bleak, with Russian crude oil production now stabilizing despite sanctions.

“Looking at the figures of early May, they are better than in April. The situation is stable, the output increased in comparison to April. We are counting on partial recovery of data in May and that it will be better,” Novak told TASS, without quantifying the increased production figures.

According to Interfax, Russia’s crude oil production slipped to 10.05 million bpd in April, a decline of about 4% year over year, but for the first few days in May, this had edged up 2% over April figures, to an average of 10.28 million bpd.

But even that increase is a far cry from Russia’s May output quota set by the OPEC+ group, which is 10.549 million barrels per day.

Somewhat unexpected but let's see where Russian production is a year from now.  

The Five Best Energy Dividend Stocks For 2022 -- Alex Kimani -- May 10, 2022

For the archives: this comes at a time the US market is crashing. Literally crashing. 

Link to Alex Kimani.

• VOC Energy Trust: 12.81%.
• China Petroleum & Chemical Corporation: 8.90%.
• Rattler Midstream LP: 8.62%.
• Devon: 7.29%.
• XOM: 3.84%.
  

NDIC Site Down -- No Data Available -- May 10, 2022

WTI: $101.80.

NDIC site: remains down.

Last info we had before the NDIC site went down:

Tuesday, May 10, 2022: 29 for the month, 94 for the quarter, 254 for one year

• 38565, conf, Hunt, Halliday 145-93-15-22H 4,

Monday, May 9, 2022: 28 for the month, 93 for the quarter, 253 for one year

• 38360, conf, CLR, Springfield FIU 10-8H1,
• 38239, conf, Ovintiv, Kramer 150-97-18-19-11HLW,
• 37702, conf, Whiting, Lacey 43-2H,

Sunday, May 8, 2022: 25 for the month, 90 for the quarter, 250 for one year

• 38240, conf, Ovintiv, Kramer 150-97-18-19-1HLW,
• 34236, conf, Oasis, Borden Federal 5300 34-36 6BX,

Saturday, May 7, 2022: 23 for the month, 88 for the quarter, 248 for one year

• 38361, conf, CLR, Springfield FIU 9-8H,
• 38241, conf, Ovintiv, Kramer 150-97-18-19-12H,
• 34235, conf, Oasis, Borden Federal 5300 34-36 7B, 

RBN Energy: The Mountain Valley Pipeline. MVP's prospects improve, but will it be enough? Archived.

Production bottlenecks and global energy security concerns stemming from the Ukraine war have flipped the script on various aspects of the U.S. energy markets. One of them is the softening of Wall Street and regulatory resistance to investment in new hydrocarbon infrastructure. That’s been particularly good news for the swarm of LNG export projects looking to move forward. It’s also improved somewhat the prospects for the embattled Mountain Valley Pipeline (MVP), the last major greenfield project for moving natural gas out of the Northeast from the Appalachian Basin. A court vacated three of the project’s key federal authorizations earlier this year, but the project recently got a greenlight when the Federal Regulatory Energy Commission (FERC) approved MVP’s amendment certificate application. Equitrans Midstream said last week that it would pursue new permits and target in-service in the second half of 2023. But the prospect of more legal challenges looms, and the question is, will it get across the finish line before severe constraints arise? In today’s RBN blog, we provide an update on the Appalachian gas market.