Locator: 45393CANADA.
Locator: 45393COP.
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.
Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.
I have a large position in COP which I've held for decades. I have added nothing to this position in at least the last ten years. I have no plans to add to this position and no plans to sell. It's a "hold" and will go to the grandchildren.
This may be the biggest energy story so far this year. We'll talk about it more later this evening.
From the blog, May 26, 2023: prescient.
COP: Part 1
- 1.22 billion outstanding shares
- $11 billion
- $11 billion / 1.22 billion shares = $9 / share.
COP: Part 2
COP: Part 3
- $9 / $115 = 7.8%.
COP: Part 4
Link here. From Zacks:
ConocoPhillips COP exercised its rights to acquire the remaining interest in the Surmont oil facility for $3 billion, thereby gaining complete ownership of the Alberta operation.
The acquisition involves a $3-billion price tag and $325 million in contingent payments. The transaction, expected to complete in the second half of 2023, will be funded with cash, and short and medium-term financing or a combination of both.
Surmont, located in northeastern Alberta, is the fourth-largest oil-sand well site in Canada. The facility produced about 135,000 barrels of oil per day in April. Oil is produced at Surmont by injecting steam into underground wells to push the region’s heavy bitumen to the surface.
Canada’s Alberta oil sands hold some of the world’s largest crude reserves, which are appealing to oil and gas producers looking to boost production. The acquisition enables ConocoPhillips to operate the assets at a rate of its choosing instead of coordinating with partners.
Gaining control of Surmont’s low-cost production will help ConocoPhillips reach its goal of returning $11 billion in cash to shareholders this year. The acquisition will add about $600 million of free cash flow per year in 2024. It will provide diversity to ConocoPhillips’ portfolio, which is mainly focused on U.S. shale right now.
COP: Part 5
Athabasca: RBN Energy, part 1 and part 2.
Part 1 of the RBN Energy series:
The US Energy Information Administration ranks Alberta’s bitumen oil sands reserves second or third to those of Saudi Arabia and Venezuela. However, evidence from the field and new research indicate that Western Canada’s oil reserves are possibly far larger and could rival or exceed those of the Saudis or the Venezuelans. Today contributor Mike Priaro begins a two part series describing Western Canada’s vast bitumen resources.
The Western Canada Sedimentary Basin (WCSB) extends from the Williston Basin, which straddles the Canada-US border, north to the Mackenzie Basins, west to the Rocky Mountains and east to the edge of the Pre-Cambrian Shield, (see Figure 1).Significant production of conventional oil, defined as crude light enough to flow in a pipeline (gravity lighter than 20° API), started in the WCSB with the discovery of the Turner Valley oilfield in the 1930s, expanded greatly with discovery of the Leduc reef trend by Imperial Oil in 1947, and peaked at 1.4 MMbd in 1973.
Part 2 of the RBN Energy series:
Western Canada’s vast bitumen sands are estimated to contain reserves of 575 billion Bbl of recoverable crude oil. The largely untapped bitumen carbonate formations lying beneath the oil sands could contain another 243 billion Bbl of recoverable reserves. When added to untapped tight oil shale reserves these huge hydrocarbon deposits potentially could make the Province of Alberta the world’s largest crude oil resource.
Today contributor Mike Priaro concludes his description of Alberta’s crude oil reserves.
In Episode 1 of this series we learned about the history and nature of Alberta’s vast bitumen sand deposits in the Western Canadian Sedimentary Basin (WCSB) as well as three extraction techniques used to produce bitumen crude – surface strip mining and in-situ thermal recovery using cyclic steam stimulation (CSS) or steam assisted gravity drainage (SAGD). In this episode we update efforts to exploit Alberta’s bitumen carbonates that are situated underneath the bitumen sands formations. We then discuss recovery factors achieved by the various bitumen extraction techniques, and describe how Alberta’s crude oil reserves compare with those of OPEC giants Venezuela and Saudi Arabia.
COP: Part 6
- Cash on hand: less than $9 billion.
- COP will pay for purchase with cash on hand and bonds. More on this later.
- Companies are rushing to finalize bond deals before the next CPI is released. Bloomberg.
May 26, 2023, Reuters:
May 26 (Reuters) - ConocoPhillips said on Friday it was buying the 50% stake in the Surmont oil facility held by TotalEnergies' Canadian subsidiary for about $3 billion, giving it full ownership and elbowing away rival Suncor Energy.
Canada's Alberta oil sands hold some of the world's largest crude reserves, which appeal to cash-flush producers looking to bolster production.
Sunco (sic) last month agreed to buy TotalEnergies’ Canadian operations for C$5.5 billion ($4.11 billion), including Total's 50% stake in Surmont, which ConocoPhillips operates.
But ConocoPhillips, which held the other 50% stake, held right of first refusal to buy the rest of Surmont. Conoco's decision to exercise that right is a setback to Suncor's plans to boost its long-term bitumen supplies to replace its aging Base Mine.
Suncor, in a statement, said its deal with Total was conditional on ConocoPhillips waiving its right of first refusal, and it is now re-assessing the transaction.
COP: Part 7
Wiki.
The geo-politics of oil -- particularly what's going on in the Mideast -- Iran, Kuwait, Saudi Arabia -- and what's going between OPEC and OPEC+ (Russia) -- and what's going on due to the Ukraine war -- and what's going on with the two big consumers, China and India, -- and to a lesser extent, what's going on in US shale -- has, all of a sudden made the Canadian oil sands very, very interesting.
Let me put that in bullets:
- Iran, Kuwait, Saudi Arabia;
- OPEC vs OPEC+ (Russia);
- XOM mulling pulling out of Vaca Muerta (Argentina)
- Ukraine: flow, sanctions, ports, etc
- India and China
- US shale
- the (relative shortage) of the "right kind of oil" (heavy, a little bit of sulfur)
All of a sudden, the Canadian oil sands are becoming much more interesting, and COP pounced.
Of course, this goes all the way back to the Keystone XL pipeline but that train has left the station -- actually, more precisely it never left the station. The Trans Mountain Pipeline did leave the station -- to continue the metaphor -- but has become a veritable train wreck. As has the Canadian prime minister's marriage.
The wiki entry is linked above (and here again, in case you missed it).
COP: Part 8.
- COP's Surmont project. Link here.
- Alberta oil sands: I never took an interest in this subject ... until now. This is one of the few blogs in which I mentioned Canadian oil sands / Alberta / Athabasca -- and that was back in 2012. Wow.
COP: Part 9.
COP: Part 10.
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