Rambling -- North Texas -- Nothing About The Bakken -- June 14, 2022

Back up drummer to Ringo is Phil Collins.

Back up guitarist to George Harrison is Eric Clapton who is backed up by Jeff Lynn.

Keyboards is Elton John. No backup.

And I thought the Traveling Wilburys were a supergroup.

While My Guitar Gently Weeps, George Harrison and Ringo Starr

I couldn't possibly be happier within the parameters prescribed by my wife.

Speaking of which, she is out in California this month. 

I guess it was pretty hot in north Texas again today. I really did not notice. I was either the Uber-Papa or in the pool.

This morning, I drove Olivia to her high school for some PSAT event.

Then across town, I went to pick up Sophia from soccer practice (0845 - 1045 daily). 

I dropped Sophia off at TutorTime at 11:15 and then went to Schwab in Southlake, Texas, for the monthly noon luncheon and "talk." Today's subject: fixed income and bonds, but the three Schwab presenters spent an hour and fifteen minutes covering a lot more than advertised on the agenda. 

It's a pretty special group: sixteen Southlake clients. I assume I am the pauper in the group. LOL.

But I'm probably the youngest and the most open to new ideas. So, I have sixteen years to catch up.

Then, pick up Sophia at 1500, and retire to the pool for the next couple of hours, before driving Olivia to soccer practice.

Then back home, after dropping Sophia off to be with her college-age sister. Their mom, our daughter, was paddleboarding on Lake Grapevine. 

And, now I have the night off to listen to all the music I want. Poolside, again, of course. It's 2118 hours and the temperature is 90°F with a great breeze. 

The pool closes at 2200 hours but it appears there will still be folks out here well past then.

One of the best videos ever, which I've posted more than once (?):

My Sweet Lord

In addition to some really famous musicians, this was really populated with some of my favorite SNL  personalities. A take-off on Tinker, Tailor, Soldier, Spy with Gary Oldham. Vanessa Bayer -- gorgeous. I first saw her in The Californians, on SNL. 

Next, Roy Orbison and Penny Arcade. This would only work in Australia -- where it was a huge hit. I never hear this song sung outside of Australia. Not that I was ever searching.

If I had all the money in the world, I would sponsor a weekly shuffle dance class here in the apartment complex, poolside. Hire a dance instructor and a videographer and go from there. Set up a 12-week dance-off with huge monetary award to the winner.

Don't Bring Me Down, ELO

Only one thing wrong with that video: way too short. 

I'll end with Lana. Doin' Time. A cover.

Doin' Time, Lana Del Rey

LBC? Long Beach County.

Honorable mention:

• Jeff Bridges breaks down his most iconic characters.

About Those Dividends -- CLR -- June 14, 2022

362.97 million shares.

28 cents per share dividend, 5/23/2022 = $101 million every quarter. Eighty three percent of that goes to Harold Hamm. After he goes private, he gets the full amount. 

I do think that Harold Hamm has out-Buffetted Warren Buffett. And Elon Musk. And God.

Six New Permits; Eight Permits Renewed; Six Permits Canceled -- June 14, 2022

WTI: $118.50

Active rigs: 37 or thereabouts

Five new permits, #39016 - #39020, inclusive:

• Operators: Lime Rock Resources (4); CLR
• Fields: North Fork (McKenzie); Jim Creek (Dunn)
• Comments;
• Lime Rock has permits for four wells in North Fork oil field, lot 3 section 1-149-97; 
• to be sited between 514 FNL and 639 FNL and between 2387 FWL and 2417 FWL;
• CLR has a permit for another Rhonda well, SWSW 28-146-96; 
• to be sited 886 FSL and 1029 FWL

Eight permits renewed:

• Grayson Mill (3): three State permits in Williams County
• Slawson (3): one Genesis permit and two Genekat Federeal permits, all in Mountrail County
• Petro-Hunt (2): a Louis Tully Federal permit and a Sherven Trust permit, both in McKenzie County; the Sherven Trust permit is for: Sherven Trust 153-95-27A-26-1HS, SWSE 23-153-95; McKenzie

Six permits canceled:

• CLR (5): two Eentzel permits in Dunn County; a Tanager, a Nuthatch, and a Stewart permit, all in Divide County

Re-Posting: Harold Hamm To Take CLR Private -- June 14, 2022

Some data points and comments:

• the Harold Hamm story was released before the market opened today (Tuesday, June 14, 2022);
• at market close today, 9.5 million shares had traded today
• normal 90-day moving trading volume is 1.5 million shares
• a reader tells me that based on the 5/2/2 CLR corporation presentation:
• CLR had approximately $960 million to purchase outstanding shares
• at $75, this is 12,800,000 shares
• according to Yahoo!Finance, there are 362.97 million outstanding shares (prior to today's announcement)
• Harold Hamm apparently owned 83% of the shares prior to the announcement
  
• SEC filings released this next week should clarify how many shares Harold Hamm bought today, assuming he bought any at all

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.

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them.

The Reason For WTI Tanking -- President Biden Announces Another Huge SPR Sale -- June 14, 2022

This needs to be fact-checked but first indications are that President Biden will release another 45 million bbls of oil from the SPR. 

If true, this simply extends the duration of the pain. 

Bullish long term. 

Later:

Here's the Reuters story.

This story suggests this is not new, but rather previously announced. If so, someone is misleading Americans on these SPR sales. And they are sales, not swaps. 

By the way, our refineries are working at near capacity, so how is all this oil from the SPR handled?

First of all, it's not all that much. Maybe an extra one million bbls per day. In this case, the "45 million bbls being sold" is for deliveries that would take place from August 16, 2022, through September 30, 2022. Exactly one million bbls / day. Tomorrow, we will know if this is heavy sour oil or light sweet oil.

Second of all, and this is a fact, jack, the "sector" is loading this excess oil onto tankers to take to India where it is refined, and then the refined product is shipped back to the states. I would imagine, but don't know, that the largest recipient of refined products from India would be the state of California based on a number of factors. 

I'm sure we will know more as the story unfolds. 

From my point of view very little has changed with the "45-million-bbl-sale" story. But I could be wrong.

NDIC Director's Cut -- April, 2022, Data

Link here.

For newbies: this decrease was predicted, based on unusual winter storm in April, 2022.

Oil:

• April, 2022: 900,597 bbls / day
• March, 2022: 1,122,640 bbls / day
• delta, bopd:
• delta, percent: down 20%
• revised revenue forecast: down 19%
  

Crude oil price:

• today: $118.25
• April, 2022: $100.16
• March, 2022: $104.68

Gas production and capture:

• April, 2022: 2,444,933 MCF / day
• March, 2022: 3,009,436 MCF / day
• delta, MCF / day
• delta, percent: down 19%

Rigs and wells:

• rigs:
• today: 37
• May: 40
• April: 38
• March: 34
• permitted:
• May: 68
• April: 55
• March: 65
• completed:
• May: 53 (preliminary)
• April: 33 (revised)
• March: 53 (said to be preliminary but probably final)
• inactive:
• April: 1,909
• March: 1,928
• DUCs
• April: 494
• March: 451
• producing:
• April: 16,896
• March: 17,087
• and this helps explains the oil and natural gas delta month/month
• March to April: 1.15 drop in number of producing wells

a

Fuel Costs Impacting Carriers? June 14, 2022

FedEx announces huge dividend increase.

• previous: 75 cents
• new: $1.15
• is that a 53% increase in the dividend rate?

Holy Mackerel! Caterpillar to Exit Chicago; Global Headquarters To Move To DFW, Texas -- June 14, 2022

Link here.

Earlier today, the Drudge Report had a blistering report on MISO - Illinois. We'll get to that later.

More than 60 companies relocated to Texas last year, according to data from the YTexas business lobby, with most shifting their headquarters from higher state tax jurisdictions such as California, including clean-energy carmaking giant Tesla. 

Specific location not mentioned in that article. It turns out that CAT is moving just down the road from us, to  Irving, TX, the "lost" city that sits between Dallas and Ft Worth, just south of airport. Wow. 

A huge "tip of the hat" to a reader. Thank you. 

**************************
MISO - Illinois

MISO website: Midcontinent Independent System Operator).

• capacity: in the 120 MW arena
• fuel mix:
• coal: 35%
• natural gas: 35%
• wind: 15%
• nuclear: 10%
• other: 4%
• solar: 1%

Rates soaring.

Why: renewable energy. 

From the linked article:

The most significant warning came recently from the Midcontinent Independent System Operator, or MISO, which oversees the power grid for Illinois and much of the Midwest. Their warning was contained in a recent forecast by the North American Electric Reliability Corp., a regulatory authority that monitors risks to the grid, and was summarized by the Washington Post as follows:

Southern Illinois is among the most vulnerable places in the country heading into the summer, according to a newly published forecast by the North American Electric Reliability Corp., a regulatory authority that monitors risks to the grid.

The area, along with large parts of Michigan, Wisconsin, Minnesota and other states linked to the regional grid, has been put on notice in the forecast that it is facing a “high risk of energy emergencies during peak summer conditions.” A major reason is that some of the coal plants that regulators assumed would keep running for another year or two are instead coming offline. Some plant operators are choosing to shut down rather than invest in upgrades for coal plants that do not fit with states’ and the federal government’s long-term goals for clean energy.

“We are seeing these retirements occur at a faster pace than expected,” said Jim Robb, chief executive of the regulatory authority. “The economics aren’t great, so coal plant operators are saying ‘uncle.’”

 But let's cut to the chase:

Central Illinois consumers “will pay double for energy starting this month, as a deal mitigating costs for many communities expires, with no new contract in sight. Communities like Peoria, Morton and East Peoria all participate in municipal aggregation programs.”

Previously posted, Texas is second from the bottom in electricity costs:

Most expensive, to least expensive, selected states; in bold red: New England and New York:

• Connecticut: 26.48 cents; hates pipelines, up a whopping 16.7% from a year ago
• Rhode Island: 25.69 cents, up 6.6% from a year ago 
• California: 25.59 cents; up 13.6% from last year;
• New Hampshire: 22.15 cents; hates pipelines; up a whopping 14.9% from last year
• New York: 21.58 cents; hates pipelines; up a whopping 14.9% from last year
• Maine: 20.95 cents; hates pipelines; up an incredible 29% from last year
  
• New Jersey: 15.77 cents; down 3.7% from last year
  
• Pennsylvania: 14.48 cents; lots of natural gas, up 10.7% from a year ago
  
• Texas: 12.28 cents, down 3.6% from a year ago
• North Dakota: lots of coal, 9.64 cents; lots of coal, up 1.9% from a year ago

NDIC Interactive Map Should Be Up And Running Today

 I'll be off the net for the next few hours. 

Good luck to all. 

CLR is up almost 15% today, up $9.36; trading near $74, still about a buck below its 52-week high.

Why Is Oil Spiking? June 14, 2022

Updates

Later, 2:17 p.m. CT: why is oil tanking? WTI now down to $117 and it looks like it will fall further. The Fed meets today. Tea leaves tell me that the word is out: the Fed is more than willing to push US into recession if that is what it takes to prevent more inflation. For the nation, at this point in time, a recession is preferable to Turkish inflation.

Original Post

OPEC reveals production loss for May, 2022.

Oil is trading at $125.

China is opening up.

OPEC is not involved in any war.

Everything is as good as it gets in the Mideast.

And OPEC's production drops? 

Too bad for the American consumer that Biden "keystoned" American. Worst decision ever. Worst timing ever.  

About XOM Making More Money Than God -- June 14, 2022

From Time, the Vatican, FEBRUARY 26, 1965 -- 1965 --

Bankers' best guesses about the Vatican's wealth put it at $10 billion to $15 billion. Of this wealth, Italian stockholdings alone run to $1.6 billion, 15% of the value of listed shares on the Italian market. The Vatican has big investments in banking, insurance, chemicals, steel, construction, real estate. Dividends help pay for Vatican expenses and charities such as assisting 1,500,000 children and providing some measure of food and clothing to 7,000,000 needy Italians. Unlike ordinary stockholders, the Vatican pays no taxes on this income, which led the leftist Rome weekly L'Espresso last week to call it "the biggest tax evader in Italy."

In 1962, Italy placed a 15% tax on all stock dividends, which two years later was raised to a 30% maximum. A rider to the original law that would have exempted the Vatican was specifically struck down. Nevertheless, the Vatican refused to pay the taxes—which might run upwards of $15 million a year-citing the Lateran Treaty of 1929 between Pope Pius XI and Mussolini. At that time, Italy agreed to pay the Pope $39 million in cash and $52 million in 5% government bonds as indemnity for losses suffered by the Pope when the Papal States were incorporated into Italy in 1870. Under Pius XII, Vatican money was shrewdly invested in stocks and real estate, and the capital has multiplied manyfold. The treaty also recognized the sovereignty of the Vatican, and a 1942 law written "in the spirit of the Concordat" exempted the Vatican from paying certain taxes then existing on dividends.

Fast forward to three weeks ago, link here:

the annual Peter's Pence collection brought in around 50 million euros (about $54 million). But the Holy See’s deficit was higher. It was therefore necessary, he suggested, to make investments to give the Holy See greater liquidity.

The investments were overseen by the Secretariat of State’s administrative office, which had established a complex financial architecture over the years, using various current accounts, including some located abroad, and always seeking out investments of a particular type.

 To the best of my knowledge, God does not pay taxes in the US, unlike XOM.

For what it's worth, the Vatican's net assets in 2019, link here, about 4 billion euros.

Compare that to the average yearly income of Catholics around the world. One might want to start with those Catholics in sub-Saharan Africa.

Investing -- For The Archives -- June 14, 2022

Usual disclaimer applies: this is not an investment site. 

For the archives, I am generally fully invested. 

With my revenue stream I invest three separate tranches each month.

Some months with a smaller revenue stream I invest only once or twice. 

This morning, at the opening, I invested my second tranch for the month of June, 2022.

Sticking to my 50-30-20 "rule":

• 50%: BRK-B-like stocks; blue chip; almost always pay dividends (BRK-B, of course is an exception);
• 30%: tech
• 20%: Permian

At some point, some other sector will replace the Permian. 

************************
Changes In Attitude, Changes In Latitude

When the market was (and is) trading at all-time highs, I tracked (and track) "net worth" in the market.

Now, with the market treading water, with everything on sale, I don't "ruin" my day by looking at "net worth" in the market.

I look at number of shares I can accumulate as quickly as possible. And the dividend return.

Thirty years from now, my grandchildren won't ask what I paid for these stocks.

**********************
By The Way, What Is WTI Doing?

Holy mackerel? 

WTI is up 2%; up $2.42; and, trading at $123.3. 

Moments earlier, somewhat higher and trending toward $124.

Summer doesn't officially begin until June 21 or thereabouts -- depends which calendar and which priestly cult you follow. 

US driving season has yet to begin.

Libya: a shambles -- one million bopd. Libya didn't matter until it mattered.

Russia: will be a shambles -- for many different reasons.

OPEC: the myth of spare capacity. How bad might it be for Saudi Arabia? It's now being reported that Russia has just overtaken Saudi Arabia as India's second-largest oil supplier. But look at the numbers, which reveal how bad it really is

The average daily rate of Russian oil exports to India stood at 819,000 barrels, which compared with a meager 277,000 barrels daily in April. [Unclear whether thee 277K refers to Russia a month earlier or Saudi Arabia.]

Russian oil is selling at a $30-discount to Brent. 

The big question: is Russian oil, that is being sold at a $30-discount to Brent, holding back the price of Brent and WTI? Interesting question, huh?

***************************
Two Days Ago

Two days ago, when oil broke through $120 -- going down -- I began to wonder if "something had changed"?

Never, never, never did I think WTI would move from $118 (or whatever it was) to $125 where it now appears to be headed.

Libya: a shambles -- one million bopd. Libya didn't matter until it mattered.

Russia: will be a shambles -- for many different reasons.

OPEC: the myth of spare capacity. 

This all goes back to Biden "keystoning" America and the "keystoning" began when Biden killed the Keystone XL the day he took office. Literally, the first thing he did as president. 

I'm not hearing much "leave it in the ground," any more. 

***********************
Why Is Oil Spiking?

OPEC reveals production loss for May, 2022.

Oil is trading at $125.

China is opening up.

OPEC is not involved in any war.

Everything is as good as it gets in the Mideast.

And OPEC's production drops?

The Bond Page -- June 14, 2022

Usual disclaimer applies:

• this is not an investment site;
• I post quickly;
• I often misread things;
• every post likely has typographical and content errors.

I haven't watched CNBC in months.

When I did watch, I usually put the interview on mute when Mohamed A. El-Erian showed up.

Wiki entry. 

Link here.

Still Looking Good -- Texas Electricity -- Doing More Than Germany To Conscientiously Lower CO2 Emissions? LOL -- June 14, 2022

I could care less / couldn't care less about ESG but look at this: Texas appears to be leading the nation in renewable energy. Does any state produce more renewable energy for its own consumption (not for exporting to neighboring states)? 

ESG - solar - wind: a bit risky in the winter, but that's being resolved. We'll never see another "bad" energy day in Texas, and to the best of my knowledge, we've only had one event that was all that bad.

Tea leaves suggest analysts outside of Texas don't understand the reason for energy demand in the state.

Link here. 

By the way, is 25 - 30 GW of continuous power more than the total amount of energy (all sources) consumed by New England?

Previously posted:

Most expensive, to least expensive, selected states; in bold red: New England and New York:

• Connecticut: 26.48 cents; hates pipelines, up a whopping 16.7% from a year ago
• Rhode Island: 25.69 cents, up 6.6% from a year ago 
• California: 25.59 cents; up 13.6% from last year;
• New Hampshire: 22.15 cents; hates pipelines; up a whopping 14.9% from last year
• New York: 21.58 cents; hates pipelines; up a whopping 14.9% from last year
• Maine: 20.95 cents; hates pipelines; up an incredible 29% from last year
  
• New Jersey: 15.77 cents; down 3.7% from last year
  
• Pennsylvania: 14.48 cents; lots of natural gas, up 10.7% from a year ago
  
• Texas: 12.28 cents, down 3.6% from a year ago
• North Dakota: lots of coal, 9.64 cents; lots of coal, up 1.9% from a year ago

WTI Surges -- June 14, 2022

Free five-year subscription to the blog for anyone who can verify the above.

Canada: can't take it any more. Tourist season here. Science hasn't changed, but economy has. Need to open up. Canada will end vaccine mandates for domestic travel on planes and trains, as well as outbound international travel. I have no idea if this changes things at US-Canadian border. I don't care.

NBA: last night -- incredible game. But Curry's 233-game streak with at least one three-pointer broken. Need to fact check. 

LIV: for the record, with Biden now re-setting his personal relationship with the Saudis, I have absolutely no trouble with Phil, et al, moving to LIV. 

These players will make so much more money and will have to play far fewer tournaments, at much more interesting venues, allowing them to spend more time with their families and more time to pursue interests outside of golf. If anyone disagrees, there's a simple question I would ask.

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

Far Side: link here.

WTI: surges. Back to $122. Holy mackerel - now it's $122.80, trending toward $123.

Active rigs in North Dakota: 35 or thereabouts. 

Tuesday, June 14, 2022: 22 for the month, 160 for the quarter, 320 for the year

38433, conf, WPX, Wounded Face 14-15HX, 

RBN Energy: an effort to help wean Ukraine, Poland, and Lithuania from Russian gas. 

The Russian war against Ukraine has focused Europe on the issue of energy security, especially as it relates to natural gas. The continent has previously relied on Russia for more than 40% of its gas, but it now must scramble for new suppliers and alternative forms of energy. The matter is particularly urgent in a few countries along or very near the Russian border, including Lithuania, Poland and Ukraine itself. Fortunately, almost two years ago the three countries formed the “Lublin Triangle,” an alliance of sorts with the aim of enhancing military, cultural and economic cooperation while also supporting Ukraine’s prospective integration into the European Union and NATO. In today’s RBN blog, we discuss the potential for developing a “New Gas Order” in Europe.

Focus On Fracking -- June 12, 2022

Link here. Lede:

• oil and natural gas hit 13-year highs;
• US oil supplies at 17.5-year low;
• SPR at 35-year low (by the way, there are reports, June 14, 2022, that SPR is emptying at fastest rate ever)
• refinery utilization highest since 2019

This website is not related to any of my websites, but I try to remember to link it every Sunday evening due to its historical value. 

Quick! How Much Did Wholesale Prices Rise In May, 2022?

Hint: "near" a record annual pace.

Hint: if you guessed 10%, you were too low.

EVs Still Cannot "Make It" Without Increased Tax Credits -- June 14, 2022

Link here.

This tells me everything I need to know about the "health" of the EV industry. 

It appears that even the wealthy can't justify spending $100,000 on a coal-burning EVs.

WTI -- Adjusted For inflation -- June 14, 2022

Link here.

Valero -- April 26, 2022 -- Posted June 14, 2022

From some time ago. Don't recall if I ever posted.

Clearing off desk top. 

Nothing new here. Simply some housecleaning. 

The screenshot below is from April 26, 2022. Today is June 14, 2022.

NOG -- Shale 3.0 -- 3Q21

From some time ago. Don't recall if I ever posted.

Clearing off desk top. 

Nothing new here. Simply some housecleaning. 

The screenshot below is from 3Q21. Currently we are in 2Q22. 

 

Happy Flag Day -- 2022

Happy Flag Day -- 2022

Harold Hamm To Take CLR Private? Flag Day, 2022

Some data points and comments:

• the Harold Hamm story was released before the market opened today (Tuesday, June 14, 2022);
• at market close today, 9.5 million shares had traded today
• normal 90-day moving trading volume is 1.5 million shares
• a reader tells me that based on the 5/2/2 CLR corporation presentation:
• CLR had approximately $960 million to purchase outstanding shares
• at $75, this is 12,800,000 shares
• according to Yahoo!Finance, there are 362.97 million outstanding shares (prior to today's announcement)
• Harold Hamm apparently owned 83% of the shares prior to the announcement
  
• SEC filings released this next week should clarify how many shares Harold Hamm bought today, assuming he bought any at all

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.

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them.