Sunday, January 15, 2023
Southern Copper Is Red Hot This Year -- Michael Fitzsimmons -- January 15, 2023
Updates
January 16, 2023: why copper prices are rebounding.
Original Post
Investing strategy this past year (2022 --> 2023):
From December 3, 2022, my investing strategy:
"New-money allocation: 30-year horizon.
- first and third week of every month
- dividend-paying
- allocation
- 40%: Buffett-like, blue chip, DE, CAT
- 25%: beaten down infrastructure (mostly semiconductors; copper)
- 20%: energy (mostly oil)
- 10%: mRNA (mostly Big Pharma)
- 5%: Daimler Truck Group
The first and third week I take all my available cash and invest in (generally) American companies in the allotment percent as noted.
For copper I used to only invest in SCCO but in the past six months have also added FCX for copper.
This evening, less than ten minutes ago this up in my el correo electrónico:
Whoo-hoo!
Michael Fitzsimmons is the SeekingAlpha contributor I "trust" the most.
The dividend is a little lower than I like.
Except for the past six months, this has not been a particularly good investment. I could not recommend it for those with a short horizon. But as noted, I have a 30-year horizon.
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 Over-Riding Themes
Global energy: the 21st century is America's century.
Medicine: it's all about CRISPR, mRNA
Information: it's all about semi-conductors, automation, robotics.
I ordered this book about twenty minutes ago (9:15 p.m. CT). It will arrive tomorrow, probably before noon, while I'm on the treadmill.
Winter Reading Program -- January 15, 2023
I finally completed:
- Too Big for a Single Mind: How the Greatest Generation of Physicists Uncovered the Quantum World, Tobia Hürter, c. 2021.
The books I will be reading over the next couple of weeks. Probably longer.
Notes on the Mailer book at this post. I've already read the first two chapters and am hooked. I can see why it was a bestseller .
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Fine Arts
From The WSJ today: link here.
From the linked article:
In 1987, artist Gretchen Bender created the installation “Total Recall,” a wall of televisions and projection screens emitting a barrage of nonstop flashing images and sound. As a critique of digital culture, it was strikingly prescient. The shift to screen life has been decades in the making, and generations of tech-savvy artists have been charting those changes. The new exhibition “I’ll Be Your Mirror: Art and the Digital Screen,” opening February 12, 2023, at the Modern Art Museum of Fort Worth , features more than 70 works by 50 artists, for whom the screen is both indispensable tool and irresistible subject.
These works include paintings, sculpture, videogames, augmented reality projects and more the 1960s to the present. The show is structured around themes such as connectivity, surveillance and the posthuman body, in which art and screen “intersect most dynamically,” says the show’s organizer, MAM curator Alison Hearst.
The first section presents screen-art pioneers like Nam June Paik, whose “TV Buddha” inspired the exhibition. In that piece, an 18th-century sculpture of the Buddha seems to gaze at its own image played back on closed-circuit TV. Originally created in the early 1970s, Paik’s iconic work foreshadows the “closed-loop echo chamber that screens create” online, Ms. Hearst says, as well as the “vanity of contemporary social media.”
Andy Warhol tried his hand at screen art in 1985, when he was hired to promote a new graphic software and created digital drawings on the Amiga, a short-lived computer beloved by programmers. At the museum, the Amiga displaying these works is a vintage 1985 model. Using an old-style corded mouse, visitors can click through a dozen Warhol pieces, including a pattern-crazed, psychedelic self-portrait. “I can’t wait for younger generations to interact with this technology,” Ms. Hearst says, imagining “how slow and awkward it must feel” to Gen Z audiences.
Much more at the link.
The Second Of Two Big Stories Reported Last Week -- January 15, 2023
Disclaimer: 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.
Long notes like these are particularly prone to having errors. If this is important to you, go to the source. I'm less interested in individual well production as I am in understanding the Bakken.Updates
January 23, 2023: see this note.
Original Post
Yesterday, I said there were two huge stories that broke
on Friday, January 13, 2023. The first story was with regard to Apple
and banking. The second story, below, is about XOM and its refinery
expansion (technically, a new refinery).
From Beaumont Enterprise, an exclusive, September 4, 2022. Right on schedule. Only in Texas.
This is huge. Corroborates my thoughts about so much with regard to Canada, heavy oil, the Keystone XL, light oil, the Bakken, and the Permian.
From the linked article:
ExxonMobil will be bringing 40 to 60 new permanent jobs to the area when it's expansion opens in the first quarter of 2023. This is a $2 billion expansion.
The company's Beaumont Light Atmospheric Distillation Expansion, more commonly known as BLADE, is the United States' largest refinery expansion in a decade.
The expansion is set to increase the light crude refining capacity at the facility by more than 65%. According to the company, its Beaumont Refinery brought in 383,000 barrels per day in the second quarter of 2022. The BLADE project will bring in an extra 250,000 barrels a day.
"The Beaumont Refinery Expansion Project will expand light crude refining to bring greater supplies of transportation fuels to the market," the company said. "The expansion consists of adding a third crude unit within the Beaumont Refinery's existing Footprint -- increasing production of diesel fuel to help meet growing demand."
Refinery Manager Rozena Dendy said the expansion is like a mid-sized refinery all on its own.
The project will also be increasing ExxonMobil's U.S. Gulf Coast refining capacity by close to 17%.
Since construction began in 2019, ExxonMobil has hired 1,600 contractors onto its workforce.
Much more at the link.
I assume if construction began in 2019, thinking about the project began seven years earlier, perhaps as early as 2012. What was going on in 2012?
I figured the Keystone XL was dead as of 2012. Link here.
Links from Friday, January 15, 2023:
There are so many facets to this story
One facet that I, perhaps, love the most -- a two-parter:
- XOM's prescience with regard to the Keystone XL; and
- XOM's long view.
XOM's leadership, through the decades, has pride XOM on its long view. Ten years out, twenty yars out; thirty years.
But most incredibly, back in 2012, or thereabouts, XOM saw the future of the Permian and then saw the future of the Keystone XL.
The timeline, in fact, goes back much farther.
Somewhere in the late 1990s through the early 2000s, US oil companies (E&P, refiners) realized that US oil production was precipitously declining.
US oil is light oil and US refineries, since the 1950s, had been optimized for light oil. But with US oil production declining, US refiners saw the future: heavy oil. Heavy oil: Saudi Arabia, western Canada, and Venezuela.
In response, US refiners spent a huge amount of money to convert the gulf refineries to handle heavy oil.
Now to put some numbers into context.
Big Oil spent in excess of $6 billion (in 1990s dollars) -- this XOM expansion? Less than $2 billion.
When the XL was canceled -- something no sane oil person would have dreamed would have happened --- all of a sudden, US Big Oil was counting on Venezuela. And then Venezuela happened. The US was in deep trouble: access to heavy oil was was now limited to OPEC, not necessarily a good option.
Despite all those challenges, Big Oil "found" enough heavy oil to meet the demands of the refiners.
And then the US shale revolution. The only problem. US shale (the Permian and the Bakken and everywheree else) was light oil. But having just spent $6 billion optimizing "light oil" refineries to "heavy oil" refineries, there was no stomach for converting the refineries again, and there was hope that a GOP president would re-instate the XL permit. Yes, but then Biden was elected. Back to square one.
Through all this, XOM saw the future. Access to heavy oil was going to continue being a challenge and the amount of light oil coming on line would be huge. Remember: when the price is right, US light oil is coming from a lot more plays than just the Permian and the Bakken.
So, XOM went first: expanded and optimized the expansion for light oil.
I'll stop there, but there is much more that could be said.
One question: what refiner will be second to follow XOM?
But this is huge.
It comes just as Biden opens up access to Venezuela's heavy oil.
By
the way, of all the social media links above, the most informative and
the most important is an excellent thread by Peter Zeihan.
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On The Importance Of Knowing How To Budget -- President Barack Obama
By the way, knowing that most folks won't click on that link, here's what else was posted that date:
As long as we are doing flashbacks, here's an April Fool's day flashback, from April 1, 2013:
I can't make this stuff up. President Obama proclaims the month of April to be the month to teach young people how to budget responsibly:President Barack Obama, who has increased the national debt by $53,377 per household, has proclaimed April “National Financial Capability Month,” during which his administration will do things such as teach young people “how to budget responsibly."“I call upon all Americans to observe this month with programs and activities to improve their understanding of financial principles and practices,” Obama said in an official proclamation.
Earnings -- 4Q22
Note: this is, hands down, one of the most boring things I to do each quarter. I doubt anyone really looks at it but the day I quit doing this will be the day I miss posting something important. The word "important" is used loosely. Very loosely.
This is so boring that I actually didn't record a thing for 1Q20, but that was threee years ago. Maybe things have changed. LOL.
This is linked at the top of the sidebar at the right during earnings
season. After earnings -- pretty much after XOM and Apple posts
their earnings -- this post will move back into obscurity.
Disclaimer: this is not an investment site.
Earnings -- 4Q22
October - December, 2022
October - December, 2022
This is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or what you think you may have read here. If this is important to you, go to the source. There will be content and typographical errors on this page. If something looks wrong, it probably is.
DE: huge beat.
ENB: missed.
Banks: reported Friday, January 13, 2023; market not impressed.
TSM: what a wild day.
HES: tops 4Q22 earnings and revenue estimates.
T: stock leaps after 4Q22 earnings beat, dividend support.
ASML: great report. Barron's. CNBC.
Boeing: oh-oh. 4Q22 surprise ... and not in a good way.
NFLX: shares surge;
- added 7.66 million new subscribers; forecast: 4.57 million
- EPS: 12 cents; forecast: 55 cents (WOW, huge miss)
- Netflix executives said they are focused on profitability as rivals lose billions trying to catch up.
************************
DEVON
Link here. Misses.
Huge dividend cut.
***************************
HAL: Huge
HAL: raises dividend by 33%.
Halliburton will raise its dividend by 33%, the company said on Tuesday, as the world’s largest fracking services provider beat analyst estimates for fourth-quarter performance. Halliburton bought back $250 million in shares during Q4 2022, and saw quarterly earnings of $0.72 per share—this compares to $0.36 per share in Q4 a year ago. HAL’s Q4 revenues came in at $5.58 billion, also beating analyst estimates and Q4 2021’s revenues of $4.28 billion. HAL’s Q4 profit was $656 million.
******************************
SLB: Huge
Separately, the company raised its quarterly dividend to 25.0 cents a share from 17.5 cents a share, with the new dividend payable April 6, 2023, to shareholders of record on February 8, 2023.Earnings:
- pre-tax operating margins and per-share earnings: highest since 2015
- net income:
- 71 cents / share; forecast: 68
- revenue:
- jumped 27%, in North America
- jumped 26% internationally
It's A Small World -- January 15, 2023
I have not fact-checked this but my wife tells me the new "Miss Universe" is Filipino from University of North Texas, Denton, Texas.
Our middle granddaughter, Olivia, played a lot of soccer on the Denton UNT fields about thirty minutes north of us.
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Local, Recent Weather
PXD Sheffield: "US Oil Production Will Decrease In 2023; Most Operators Are Drilling Tier 2 And 3 Locations In The Permian, The Bakken." Hess: "Hold My Oil Can."
The Hess BB-Budahn wells are tracked here.
Hess has added at least six more BB-Budahn wells.
The wells:
- 38167, conf, Hess, BB-Budahn-150-95-0506H-9, Blue Buttes, t--; cum --;
- 38166, conf, Hess, BB-Budahn A-150-95-0403H-12, Blue Buttes, t--; cum --;
- 38165, conf, Hess, BB-Budahn-150-95-0506H-8, Blue Buttes, t--; cum --;
- 38164, conf, Hess, BB-Budahn A-150-95-0403H-11, Blue Buttes, t--; cum --;
- 38163, conf, Hess, BB-Budahn-LN-150-95-0506H-1, Blue Buttes, t--; cum --;
- 38162, conf, Hess, BB-Budahn A-LN-150-95-0403H-1, Blue Buttes, t--; cum --;
Early production:
- 38162:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 25605 | 45645 |
| 10-2022 | 28252 | 47094 |
| 9-2022 | 22274 | 33847 |
| 8-2022 | 46139 | 71339 |
| 7-2022 | 11391 | 12413 |
- 38163:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 26317 | 53555 |
| 10-2022 | 29442 | 49304 |
| 9-2022 | 32115 | 52951 |
| 8-2022 | 49801 | 78447 |
| 7-2022 | 7849 | 9418 |
- 38164:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 21909 | 42589 |
| 10-2022 | 22416 | 39196 |
| 9-2022 | 19641 | 33797 |
| 8-2022 | 21935 | 36465 |
- 38165:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 23520 | 46009 |
| 10-2022 | 26978 | 48276 |
| 9-2022 | 30299 | 45257 |
| 8-2022 | 24448 | 21683 |
- 38166:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 27310 | 57878 |
| 10-2022 | 28917 | 51686 |
| 9-2022 | 8645 | 14276 |
| 8-2022 | 23884 | 34042 |
- 38167:
| Date | Oil Runs | MCF Sold |
|---|---|---|
| 11-2022 | 9446 | 16179 |
| 10-2022 | 30691 | 55951 |
| 9-2022 | 32834 | 54392 |
| 8-2022 | 33553 | 46245 |
The graphic:
The Hess BB-Budahn Wells -- Recently Off-Line -- Are Pretty Much All Back On Line With Good Results -- January 15, 2023
Disclaimer: 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.
Notes like these, with lots of data, and many, many updates are particularly prone to having errors. If this is important to you, go to the source. I'm less interested in individual well production as I am in understanding the Bakken.
The Hess BB-Budahn wells are tracked here.
This page will not be updated. The wells will be updated at the link above.
Production data has been updated for all wells; those with some additional information in bold preceded by three asterisks.
Several show significant increased production, something the theory says should not happen.
The BB-Budahn Wells
- 28161, 1,772, Hess, BB-Budahn A-LS-150-95-0403H-1, Blue Buttes, 4 sections, t12/14; cum 364K 5/19; taken off-line 1/17; back on line shortly after that; cum 461K 11/22;
- 27505, 1,628, Hess, BB-Budahn A-150-95-0403H-6, Blue Buttes, t12/14; cum 351K 5/19; cum 424K 11/22;
- 27504, 1,314, Hess, BB-Budahn A-150-95-0403H-7, Blue Buttes, t12/14; cum 241K 5/19; cum 294K 11/22;
- 27503, 1,675, Hess, BB-Budahn A-150-95-0403H-8, Blue Buttes, t12/14; cum 294K 5/19; cum 343K 11/22;
- 27502, 1,740, Hess, BB-Budahn A-150-95-0403H-9, Blue Buttes, t12/14; cum 270K 5/19; cum 320 K 11/22;
- 27501, IA/1,674, Hess, BB-Budahn A-150-95-0403H-10, Blue Buttes, t12/14; cum 301K 5/19; cum 372K 4/22;
- 24410, IA/56 (no typo), Hess, BB-Budahn A-150-95-0403H-5, Blue Buttes, t7/13, cum 197K 5/19; there must have been a problem with the frack; data not provided because "data incomplete"; cum 241K 4/22;
- 24409, 1,339, Hess, BB-Budahn A-150-95-0403H-4, Blue Buttes, t6/13;cum 350K 5/19; cum 398K 10/22; off line; production sporadic, recently;
- 24408, 1,335, Hess, BB-Budahn A-150-95-0506H-4, Blue Buttes, t3/14; cum 322K 5/19; cum 373K 11/22; back on line;2
- *** 24407, IA/1,415, Hess, BB-Budahn A-150-95-0506H-5, Blue Buttes, t3/14; cum 352K 5/19; cum 413K 4/22; remains off line 11/22;
- *** 23457, 1,196, Hess, BB-Budahn A-150-95-0403H-2, Blue Buttes, t6/13; cum 299K 5/19; cum 353K 11/22; was off line for four months; back on line;
- *** 23456, 1,476, Hess, BB-Budahn-150-95-0506H-2, Blue Buttes, t3/14; cum 357K 5/19; cum 426K 11/22; after being off line for four months, back on line 10/22; production doubles;
- 23455, 1,291, Hess, BB-Budahn A-150-95-0403H-3, Blue Buttes, t6/13; cum 337K 5/19;
- *** 23454, 1,422, Hess, BB-Budahn A-150-95-0506H-3, Blue Buttes, t5/13; cum 307K 5/19; cum 367K 11/22; after being off line for four months, back on line 10/22; production triples;
- *** 19737, 1,341, Hess, BB-Budahn A-150-95-0403H-1, Blue Buttes, t1/12; cum 460K 5/19; bump in production from halo effect; after being off line for six months, back on line 10/22; production doubles;
- *** 16603, 391, Hess, BB-Budahn A-150-95-0506H-1, Blue Buttes, t8/07; cum 248K 12/18; off line as of 2/19; remains off line 5/19; produced for two days in 9/22; but remains off line (IA);