PXD Dividend -- July 26, 2022

Laser-focused on dividends.

PXD dividend history.

Now this, from Michael Fitzsimmons:

• PXD is down 20%-plus since its high in June, even as consensus earnings estimates have risen significantly. 
• Meantime, this week's Barron's pointed out that energy stocks make up ~4% of the S&P 500 yet are expected to account ~12% of the index’s earnings in Q2. 
• PXD is likely to pay out substantially more than $20/share in total dividends (base+variable) this year. 
• Note: most financial websites are not reporting variable dividends/yields very well. Given the price action has been lower, while the earnings consensus has risen, I'm upgrading my rating on PXD from HOLD to BUY.

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. Full disclaimer at tabbed link.

Energy Odds And Ends -- July 26, 2022

From oilprice.com:

Beating a dead horse:

• New England, New York: a supply problem.
• Texas: a demand problem

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A Medical Note

If I can't pronounce or spell the generic / brand name of the drug, I will never take it. 

Period. Dot. 

The New NDIC GIS Map Server -- Incredible -- Worth The Wait -- July 26, 2022

I can't say enough positive things about the new NDIC GIS map server.

It is incredibly robust. 

This is what I sent a reader.

This link will take you to the NEW MAP that just went live a few days ago:  https://gis.dmr.nd.gov.

At that link, a small map shows up but it's just a picture. You need to click on "ND OIL & GAS Viewer."  https://gis.dmr.nd.gov/dmrpublicportal/apps/webappviewer/index.html?id=a2b071015113437aa8d5a842e32bb49f

It's a very, very robust application. It may take a few seconds to load depending on your computer.

In the left upper corner, there is a "search magnifying glass."

Type in the NDIC file number for the well (in this case: 15206) and the application will take you to the well. You can use the "+/-" icons in the upper left hand corner to make map larger or smaller.

If you don't have the file number, you can also search by the well name, in this case, Federal 33-20.

No New Permits, Zavanna Renews Four Permits -- Tuesday, July 26, 2022

SPR release: I'll update this and provide some links later, if the spirit moves me. 

GOOG and MSFT both miss. Details later. Screenshot now.

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Back to the Bakken

SPR release: the release continues; one million bbls/day to be sold; twenty million bbls to be auctioned with the announcement today. I assume this takes us through most of August. This is a non-story; simply political in nature. There is no new authorization. This continues to be sales (not swaps) first authorized in March, 2022.

WTI: $94.98. Dropped from a high of $98 during the early morning before the SPR release was announced.

Natural gas: rose 3%; not affected by the SPR release. Closed at $8.993. Would be much higher, all things being equal, if Freeport LNG export terminal were open. Whether Freeport opens any time soon is now a political decision. My hunch: won't re-open until European winter emergencies, earliest being January, 2023.

Active rigs: 45 or thereabouts.

No new permits.

Four permit renewals:

• Zavanna: four King Charles permits in Williams County.

Inquiring Minds Want To Know -- July 26, 2022

Remember when the US government seemed to be running out of money every six months and the Secretary of the Treasury would warn the US Congress that if the debt limit wasn't raised, the US would default?

Maybe this screenshot will help:

So, what happened? I can't recall the last time we've gone so long without the SecTreasury concerned about running out of money.

There are at least three reasons which I will come back to later, but will let folks think about it for while. I think it's fascinating.

Summer Of Books, 2022 -- On Rare Birds -- July 26, 2022

One and done: they're reading the blog. The other day -- was it yesterday or last week, I forget -- I said with regard to the Fed: one (more) and done: link here.

************************
Summer of 2022 Reading

My "summer of books, 2022" is tracked here.

• Today, I finished On Rare Birds, Anita Albus, translated from the German by Gerald Chapple, c. 2005 by Albus; copyright 2011 by Chapple.

The author covers ten birds species (with some closely related species) that have either recently gone extinct or those in extreme danger. 

The extinct birds:

• the passenger pigeon
• the parakeet and its practices
• the ways of the Great Auk
• the loneliness of the macaw

The birds that are threatened and endangered:

• the wonderous waldrapp
• the shy corncrake
• the uncanny goatsucker, or the willful nightjar
• the beautiful barn owl
• the intrepid hawk owl
• the wise kingfisher

My favorite chapters:

• chapter one: the passenger pigeon
• chapter eight: the beautiful barn owl

Chapter one, the passenger pigeon, was number one for historical information on a subject most of us seem to know something about. 

However, chapter eight really was the best, learning about the barn owl. Truly amazing. Some excerpts later, perhaps, but a chapter that I will share with Sophia.

Chapter ten, the wise kingfisher was probably the third best chapter. 

Just for the fun of it, I'm going go through chapter eight, page by page, and note every word that was new to me or of special interest, although I may have already come across it elsewhere.

• veil: the veil forms the face of the Barn Owl, and all species of owls have one (a veil) 
• Augapfel: German for "eye-apple" -- what the Germans call the eyeball 
• belle de nuit: 
• shivareee 
• "owl levy" (Eulengebühr): a vent in the gable end of a barn left specifically for Barn Owls.

Now, the same for chapter ten; words that are completely new to me in bold:

• Alcyone: the daughter of Aeolus, the Greek god of the winds; Alcyone and her deceased husband, Ceyz, were transformed into kingfishers, a story re-told by Ovid; I've read Ovid, but I don't recall this story; Pliny mentions "the starre Virgiliae; Alcyone, a star in the Pleiades
• meerschaum: a leather coral; we all know meerschaum pipes (for smoking, Turkish, Greek)
• Halcyones: from Alcyone, faithful wife
• the Halcyon days: also at the wiki link above; the seven days in winter when no storms occur;
• halcyon: often used interchangeably with the word "kingfisher"
• Alcedo: also used interchangeably with the word "kingfisher"
• Alcyon (male) and Alcyone (female): used interchangeably with "kingfisher"
• in bono or in malo:
• kairos:
• sophrosyne:
• azure-blue and malachite-green plumage
• schadenfreude

Other data points from the kingfisher chapter:

• The Australian kookaburra is a kingfisher, one of twenty-three species among fourteen genera and two sub-families.
• One of the names of the Australian kookaburra is "Giant Dacelo." The genus name "Daceloo" is an anagram of alcedo.
• High-speed hunters such as kingfishers, hawks, swifts, hummingbirds and parrots have two foveae (small depressions in the retina) in each eye, allowing their eyes to focus sharply on their prey and estimate distances better. Swallows and terns are equipped with three fovea in each eye. 

If the barn owl goes extinct, it will go extinct not because of any deliberate / direct act by any predator or "enemy" (such as man) but because the loss of an adequate number of field mice to keep the barn owl population alive. Modern farming techniques have pretty much eliminated the number of field mice the barn owls need.

Extinction:

• since 1500 A.D., 133 bird species worldwide have become extinct
• since 1800: 103 of those 133 bird species became extinct
• four categories of threatened birds:
• critically endangered
• endangered
• vulnerable
• near-threatened
• worldwide, currently, number of species:
• critically endangered: 192
• endangered: 362
• vulnerable: 669
• near-threatened: 838
• as of 2010:
• 20 species in the large parrot family are already extinct
• 15 species are critically endangered
• 79: more or less endangered

WIth WTI At $90 And Natural Gas Trending Toward $10, EOG Returns To The Utica -- July 26, 2022

The Utica is tracked here, and at the sidebar at the right. 

There are multiple story lines in the post below. A huge thanks to the reader who sent me the initial link.

With minimal editing, a very credible, reliable reader provided me this earlier today:

I just spent a semi-frenzied couple of hours trying to learn what I can about EOG's Rose well in Carroll County, Ohio.

It produced ~700 bbld first 14 days online (10,275 bbls), along with 3 million cfd of natgas.

 

Reports are rocketing around the net  that EOG has been determinedly leasing up acreage in that area (fringe of Utica oil window, Carroll/Stark counties).

 

In addition, EOG is building a short takeaway pipeline for the product.

Biggest data point (to me) is that this oil-drenched, shallow (7,000 foot) formation is now economical to be developed due to EOG's use of High Pressure, Single Point gas lift.

This last is unconfirmed, but - if true - could have ENORMOUS implications for 'shale' oil production everywhere.

I am reluctant to 'get ahead of my headlights, but the concept of using high pressure gas lift to extract 'shallow/under pressured' oil could - IF effective - have huge impacts throughout the energy world.

Okay, so let's see what's out there:

• shaledirectories.com, July 22, 2022:
• shaledirectories.com, December 4, 2021;
• from Dave Boyer @ Mudrock Enegy, February 17, 2022;

From the December 4, 2021, story:

EOG Resources is the premier shale drilling company in the country which has led to its strong financial success. 

I have thought for months that EOG was drilling in Carroll County, Ohio. 

In November permitting reports, EOG has received a permit to drill in Rose Township in Carroll County. The presence of EOG in the Utica is a bullish sign for drilling in the Utica for years to come.

At least one of the linked articles also confirms that EOG is putting in a takeaway pipeline for the Rose well production.

With regard to high pressure gas lift, the first link below is to Schlumberger:

With respect to Carroll County, Ohio:

Alpine High Update -- July 26, 2022

Earlier:

• mrt, May 27, 2022: Apache resumes drilling in Alpine High play, high prices make it profitable.
• Hart Energy, May 31, 2022: Alpine High revisited.
• Bloomberg, February 26, 2020: Apache calls it quits.

From today:

Link here.

The Alpine High is tracked here, at the sidebar at the right.

Sure Doesn't Feel A Recession To Me -- July 26, 2022

Walmart: the experts tell us that the Walmart 2Q22 results suggest the American consumer is tapped out and inflation is taking its toll. And yet for the past twenty years, I've been told that Walmart is the defensive stock during a recession or during a period of stagflation. All of a sudden, not? It appears more and more it was due to a one-off in Walmart's inventory control and apparel. 

At the end of the day, Walmart is pretty much selling staples to the middle class. 

How do we know that Walmart consumers are not moving upscale? Perhaps Walmart is facing increased competition from all that free delivery by new web-based ghost stores. Perhaps Walmart is facing increased competition from Target and Amazon.

I believe the brand name cereal companies are doing just fine, passing their costs unto consumers and today both Coca-Cola and McDonald's reported superb quarters. My hunch, it's morn than just brand loyalty. It's how to manage inventory. 

Coca-Cola can price their products at a premium during the first two weeks of the month when consumers are flush with cash, and then bring down their prices at the end of the month when households are getting a little low on cash. Coca-Cola makes a profit at the end of the month, but really, really does well at the beginning of the month. "Low prices all the time" at Walmart provides minimum return throughout the month.

Regardless, if one is into retail, KO, MCD, TGT, WMT -- great buying opportunities.  For the record, KO raises annual revenue forecast. KO remains one of Warren Buffett's biggest holdings. My hunch: Warren Buffett is proving KO with lots of capital and lots of marketing advice. 

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. Full disclaimer at tabbed link.

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.

Amazon. It's hard to put Amazon in the same "retail" sector as KO, MCD, TGT, or WMT. 

By the way, add another retailer. Polaris. If Americans are tapped out, if we're in the middle of a recession, if gas prices are too high, explain Polaris. 

GE? I have no idea what they sell any more. Aviation? Whatever. GE posts blowout earnings, and it remains on track for a 3-way company split. GE posting blowout earnings in the middle of a recession? Okay.

If investors aren't taking advantage of these buying opportunities ....

Recession fears and rising rates are a buying opportunity for affluent Americans: "This is when the wealthy make their money."

Why just the wealthy? Can't others -- the non-wealthy -- also invest?

In the big scheme of things, politicians are not paid much, but even Nancy Pelosi, took the opportunity to make a huge investment in tech.

The Apple Page: Apple had the M1 Mac Pro ready to ship a month ago but has reasons to wait: an M2 extreme Pro is just around the corner. The "extreme Pro" will have a price point that will seem ludicrous for many, but they will settle for the M1 Mac Pro, especially in light of the recent comparison of the M1 MacBook Air with the M2 MacBook Air.

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. Full disclaimer at tabbed link.

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.

WMT: Less Recession; More Competition; Poor Execution -- July 26, 2022

WMT: 2Q22 earnings -- starting to get a better picture; two things:

• poor inventory control; a one-off; seldom seem with Walmart
• clothing sales hit the skids

MCD: link here.

• great execution;
• same recession that WMT is facing
• same demographic as WMT:

• jumping 10% during a recession is no trivial accomplishment; especially when WMT fails same quarter;

EVs: The "E" Stands For The Elite -- July 26, 2022

Link here.

Running Scared -- Why Walmart Signed With Canoo -- July 26, 2022

Link here.

Walmart kicked off a deal with electric vehicle company Canoo on Tuesday to purchase 4,500 of its last-mile delivery vehicles. 

While the deal is not exclusive, it does prevent Canoo from making sales to Walmart’s rival Amazon.

Walmart’s agreement to purchase up to 10,000 electric vans from startup-turned-SPAC Canoo includes a caveat blocking sales to Amazon, according to a regulatory filing. 

Canoo had warned last quarter that it may not have enough money to stay in business, so it’s no surprise that the company took this deal with Walmart, despite the restrictions. 

Canoo shares surged more than 50% when the news of the deal broke, but have since fallen 1.65% in after-hours trading on Wednesday. The company’s shares are down nearly 56% year-to-date. 

Amazon may not be interested in Canoo anyway. The online retail giant has ordered 100,000 vehicles from Rivian, of which it also owns a 20% stake. While it’s not clear how many EVs Rivian has yet delivered to Amazon, the company says it is on track to hit its goal of producing 25,000 EVs this year. However, that is about 15,000 shy of Rivian’s initial production target — the company lowered its production guidance in March after disappointing 2021 Q4 earnings. 

Amazon also signed on to be the first commercial customer for the Ram ProMaster electric van, which Stellantis plans to launch in 2023. 

In terms of pure revenue, Walmart is still a good bet for Canoo. Total sales topped $141 billion in the company’s first-quarter results, compared to $81 billion in retail-related sales for Amazon. 

And per the terms of the deal, Walmart could end up owning more than 20% of Canoo through a warrant issued to the retailer to buy up to 61.2 million shares at an exercise price of $2.15 per share. The warrant has a term of 10 years and is vested immediately with respect to 15.3 million common shares, according to the filing.

Note, retail-related sales --

• Walmart: $141 billion, 1Q22
• Amazon: $81 billion, same quarter

Overnight -- July 26, 2022

Covid: story did not make the mainstream news. 

China: there are two stories here; easy to miss one or the other.

PBR (Brazil): link here.

Refiners:

Corn: link here.

• another incomplete analysis
• the only states that matter: Iowa and North Dakota
• question could easily be answered by providing anticipated production by state
  

Crashworthy: link here.

• I assume this happened after angry driver couldn't find charger en route to important meeting
  

Gasoline demand, natural gas demand: Goldman Sachs analysis.

Four Wells Coming Off Confidential List Over Next Three Days -- July 26, 2022

 GM: misses. Maintains full-year guidance.

AMZN: to increase Prime membership by up to 43% -- in Europe. 

Sayonara; Intel

• M2 MacBook Air
• Apple has replaced last remaining Intel-made component in newest laptop
  

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Back to the Bakken

The Bakken is back -- NGI. Link here.

Far Side: link here.

WTI: $98.38.

Natural gas: $8.975.

Active rigs: 46 or thereabouts

Thursday, July 28, 2022: 28 for the month, 28 for the quarter, 367 for the year

• 38667, conf, CLR, Bang 4-4H,

Wednesday, July 27, 2022: 27 for the month, 27 for the quarter, 366 for the year

• 38614, conf, CLR, Bang 13-4H1,

Tuesday, July 26, 2022: 26 for the month, 26 for the quarter, 365 for the year

• 38676, conf, CLR, Bang 5-4H1,
• 37496, conf, Petro-Hunt, State 159-94-25A-36-2H,

RBN Energy: LNG outages and Russian aggression send global gas prices soaring -- again. 

Escalating Russian aggression and LNG supply shortfalls, exacerbated by outages in the U.S. and Australia, have put the pressure back on international gas markets and sent prices in Europe and Asia back toward their winter highs. Around the world, high prices have pushed some end users out of the LNG market and spurred on the global, cross-commodity energy shortage that has had utilities and governments scrambling, sometimes unsuccessfully, to keep the power on. The European Union (EU) is pushing its members to reduce gas consumption by 15% through winter and parts of Europe face austerity measures. Some European countries are turning back to coal generation as the continent prepares for the prospect of a winter with less — or potentially even no — Russian gas. In today’s RBN blog, we look at where things stand in the international gas market and the ramifications for the winter ahead and beyond.