Now, We Have A Nitrogen Problem -- Friday -- November 24, 2023

Locator: 46151B.

My favorite topic (after the Bakken): this is what I find most interesting about this chart: for those "following" Buffett, buying PRG anytime in the past ten years would have been a no-brainer. Could you have seen this a few years ago? Sure, check out the five-year time scale. How about a year ago? Check out the one-year time scale. And one could have done this anywhere along the line in real-time.

Same would hold true for AAPL, but perhaps on a shorter time scale. I'm curious. Let's compare AAPL with PGR over five years:

So, there you have it. Why the greatest investor of all time bought AAPL and not PGR.

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

WTI: $76.08.

Sunday, November 26, 2023: 135 for the month; 135 for the quarter, 705 for the year
38781, conf, Oasis Peregrine 54001 442-24 3B,
37108, conf, BR, Carlsbad 3C UTFH,

Saturday, November 25, 2023: 133 for the month; 133 for the quarter, 703 for the year
39144, conf, Enerplus LK Bice 147-96-6-31-1H,

Friday, November 24, 2023: 132 for the month; 132 for the quarter, 702 for the year
39773, conf, CLR, North Tarentaise Federal 3-18H1,
38782, conf, Oasis, Peregrine 5401 42-24 4B,
38780, conf, Oasis, Peregrine 5401 42-24 2B,

RBN Energy: high-nitroen Permian natural gas mucks up Texas gulf coast LNG feedgas. I've not heard this to be a problem with Bakken oil.

There’s a lot of nitrogen out there — it’s the seventh-most common element in the universe and the Earth’s atmosphere is 78% nitrogen (and only 21% oxygen). And there’s certainly nothing new about nitrogen in the production, processing and delivery of natural gas. That’s because all natural gas contains at least a little nitrogen.

But lately, the nitrogen content in some U.S. natural gas has become a real headache, and it’s getting worse.

There are two things going on.

First, a few counties in the Permian’s Midland Basin produce gas with unusually high nitrogen content, and those same counties have been the Midland’s fastest-growing production area the past few years.

Second, there’s the LNG angle.

LNG is by far the fastest-growing demand sector for U.S. gas.

LNG terminals here in the U.S. and buyers of U.S. LNG don’t like nitrogen one little bit. As an inert gas (meaning it does not burn), nitrogen lowers the heating value of the LNG and takes up room (lowers the effective capacity) in the terminal’s liquefaction train.

Bottom line, nitrogen generally mucks up the process of liquefying, transporting and consuming LNG, which means that nitrogen is a considerably more problematic issue for LNG terminals than for most domestic gas consumers. So as the LNG sector increases as a fraction of total U.S. demand, the nitrogen issue really comes to the fore. In today’s RBN blog, we’ll explore why high nitrogen content in gas is happening now, why it matters and how bad it could get.