OKE — 4Q22 — Mixed

Link here.

Laser-Focused On Dividends -- CHRD -- February 27, 2023

Somewhere along the line I missed this one.

Chord Energy -- CHRD -- has increased its quarterly dividend, from $3.67 to $4.80.

Look at that dividend yield: almost 11%. 

Chord Energy is the new company, through the merger of Oasis / Whiting.

No New Permits But Five DUCs Reported As Completed -- Febriuary 27, 2023

Active rigs: 45.

WTI: $75.68.

Natural gas: $2.731.

No new permits. 

Five producing wells (DUCs) reported as completed:

• 38926, 2,761, Grayson Mill, Timber Creek 13-24 3H,
• 38928, 3,665, Grayson Mill, Timber Creek 13-24 5H,
• 38715, 1,232, Ovintiv, Calhoun 149-98-3-10-15H,
• 38717, 352, Ovintiv, Calhoun 149-98-3-10-14H,
• 38722, 3,641, Ovintiv, Calhoun 149-98-3-10-4H,

Wells of interest:

• 20538, IA/352, Ovintiv, Calhoun 1-3H, Pembroke, t8/11; cum 381K 7/22; off line 8/22;
• 23302, IA/1,602, Grayson Mill, Timber Creek 13-24 1TFH, Alexander, t7/13; cum 205K 5/22; off line 6/22;

Electricity Statement -- North Texas -- February 27, 2023

This is our entire utility bill. We only have electricity, no natural gas. 

This past month my wife and I made no effort to conserve energy / electricity. We used what we wanted, and we kept the house warmer than usual during the February cold spell.

Had we worked hard to conserve energy, we could have probably trended toward $75 for the month. I don't find a huge difference between $75 and $115.

Our base rate is 14 cents / kwh for the first 2,000 kwh.

This past month; 793 kwh.

793 x 0.14 = $111.02.

Our rate has been increased to 15.5 cents / kwh for the next two years.

793 x 0.155 = $122.92.

So, we'll see. 

****************************
Poolside

6:28 p.m. -- sun below the horizon, or at least behind the buildings. Beautiful weather and it will be even warmer tomorrow. I'll try getting into the pool tomorrow. LOL. Looking a little scruffy in the photo below.

Oh, Oh -- OXY Misses On Top And Bottom Line -- February 27, 2023

EPS: $1.60-something vs $1.81 estimate.

Declares a healthy dividend increase. Raises dividend to 18 cents / share. Was thirteen cents / share, and as recently as 2021, was a single penny. 

5 / 13 = a 38-percent increase in its dividend.

OXY preview here.

The fact that OXY missed both on the top line and the bottom line should be very, very concerning. Very concerning. I'm sure we will get reassuring guidance.

PEMEX — Staggering Loss — Mexico: The Poster Child For Peak Oil -- February 27. 2023

There’s only one explanation for a loss like this.

Link here to Charles Kennedy.

Mexico’s president Andres Manuel Lopez Obrador (AMLO) campaigned on promises of reviving Pemex for the national interest; however, while oil companies the world over raked in windfall profits on the back of Russia’s war on Ukraine and sanctions last year, Pemex has moved sharply in the opposite direction

Government intervention, in the form of $45 billion in capital injections, tax breaks and other machinations has failed to move the needle and the plan to boost production by moving offshore production to shallower waters and focusing more attention on onshore plays has likewise met with no success.

So, what was the loss?

Pemex, for 4Q22, reported $9.4 billion in losses in a single quarter, more than triple the losses of the previous quarter.

Pemex output fell to 1.62 million barrels per day in 2022, the third year that Pemex has reported a decline.

As of April, 2022: 

From National Gas Intelligence:

The company reported a fourth-quarter net loss of 172.4 billion pesos ($9.4 billion) after a 52- billion peso loss in the third quarter.

In 4Q2021, Pemex reported a loss of 124 billion pesos.

On the bright side, Pemex managed to turn a profit of 23 billion pesos, or about $1.25 billion, over the course of 2022. It was the first positive annual result in a decade

In 2021, Pemex reported a loss of 295 billion pesos.

During an earnings call on Monday, executives also highlighted work to lower the company’s debt burden. Total debt fell to around $107 billion, from $109 billion at end-2021. Production also was up. Natural gas output in the fourth quarter was 3.91 Bcf/d, compared to 3.72 Bcf/d in the year-earlier period. In 2022, gas production averaged 3.87 Bcf/d, compared to 3.69 Bcf/d in 2021.

The improved result was mainly due to new fields in the southeast, such as gas-rich Quesqui. Executives also highlighted improved drilling times.

Biden Laying Down Markers And Reminders -- February 27, 2023

Updates

February 28, 2023: wow, wow, wow, I hit the nail on the head. It's now being reported that China's Xi is warning Elon Musk not to release the DOE report on Xi's involvement in release of the Covide virus from a Wuhan lab. Remember, of all the countries affected most by the virus, it's hard to imagine a people hit worse than the Chinese. Wow, wow, wow. Link here: https://www.foxbusiness.com/business-leaders/china-warns-elon-musk-covid-lab-leak-comments. Let's see if any other media outlet picks up this story. Xi is on extremely thin ice; it may not take much for a coup d'état. Let's see: Nordstream and now this. US intel community doing well. 

Later, 3:42 p.m. CT: if indeed, the Biden administration was successful in having China walk back plans to provide "lethal" aid to Russia, this speaks volumes. China knows what sanctions could do to China's economy. Donating "lethal" aid won't help China's economy. If Russia does not get Chinese, that pretty much cements Russia as the global outcast.

Original Post

Posted earlier: 

Covid, WSJ, DOE: well played.

• obviously "no one" read past the headline; LOL.
• P. T. Barnum comes to mind
  

Saudi Arabia fell in line immediately; Saudis aren't known for swift action but not only did they donate $400 million in aid but the prince did it in person. For the photo op. Not to be outdone by America, but more importantly, send a strong message to China.

And it worked. Biden has a stronger hand.

See this:

*******

 Inside The the ER On The Eve of Covid

Link here: https://lithub.com/inside-the-emergency-room-on-the-eve-of-the-covid-19-pandemic/?utm_source=Sailthru&utm_medium=email&utm_campaign=Lit%20Hub%20Daily:%20February%2027%2C%202023&utm_term=lithub_master_list.

It might have been worse but fortunately America had 330 million virologists.

 

************************
A Personal Note

USAF physicians. In progress.

The Small Print: Starting Price -- February 27, 2023

Link here.

WSJ Front-Page Op-Ed On Fracking In 2023 -- February 27, 2023

Link here.

Frackers are set to plow more cash into oil fields this year compared with last, but it isn’t expected to unleash the flood of crude that past spending binges in the shale patch have.

EOG Resources Inc. said it would spend about $1.4 billion more than last year, but that its oil production would rise by only about 3% in 2023. Pioneer Natural Resources Co. said it would augment its budget by nearly $1 billion, but its production would increase by less than 7% from 2022. And Marathon Oil Corp. MRO said that although its expenses would jump by up to 35%, its production would remain flat.

The disconnect between spending and production gains makes for a murky outlook for oil and gas producers in 2023, analysts said. It comes after many producers rode high oil prices following Russia’s invasion of Ukraine to record profits in 2022, but suggests their ability to grow is limited.

"EOG Resources Inc. said it would spend about $1.4 billion more than last year, but that its oil production would rise by only about 3% in 2023."

• absolutely no analysis
• mixing CAPEX dollars with production change in percent;
• what percent does the CAPEX increase represent?
  
• how does the production increase translate to the bottom line in dollars?
• can companies execute their CAPEX plan with free cash flow while still paying regular dividends and variable dividends?
  

What if that 3% translates into $10 billion dropping to the bottom line versus the $1.4 billion allocated. LOL. Obviously that's hyperbole but again, without analysis using real numbers no one knows what $1.4 billion means and/or what a three percent increase in production means.

The rest of the article reads like an op-ed without any analysis. 

Devon says they can fund their 2023 program requiring no outside funding all the way to $40-WTI.

EOG's $1.4 billion CAPEX increase will likely pay for itself by the end of 2023.

Without Comment -- Home Sales And Apartment Rents -- February 27, 2023

Link here.

The National Association of Realtors’ index of pending home sales climbed 8.1% to 82.5 in January, higher from the projected estimate of 1.0% by Bloomberg economists.

On a yearly basis, however, pending transactions plunged by nearly 24%. 

Meanwhile, it's also being reported that apartment rents are falling.

Apartment rents fell in every major metropolitan area in the U.S. over the past six months through January, a trend that is poised to continue as the biggest delivery of new apartments in nearly four decades is slated for this year.

Renters with new leases in January paid a median rent that was 3.5% lower than they would have paid last August, according to estimates from listing website Apartment List.

It was the first time in five years that rent fell every month over a six-month period.

No comments, just one question: what's the definition of "transitory"?

OXY To Report -- What To Expect -- February 27, 2023

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.

Zacks link here.

The Zacks Consensus Estimate for fourth-quarter crude oil production is pegged at 656 thousand barrels of oil per day. For natural gas, the Zacks Consensus Estimate for the quarter is pegged at 1,754 thousand cubic feet per day.

Occidental expects total production of 1,200-1,260 thousand barrels of oil equivalent per day (MBOE/d) and 556-590 MBOE/d output from Permian Resources.

The Zacks Consensus Estimate for fourth-quarter earnings per share and total revenues are pegged at $1.83 per share and $8.65 billion, reflecting a year-over-year increase of 23.7% and 8%, respectively.

Financial Times. Archived.

Oxy and Anadarko: how the "dumbest deal in history" paid for for Vicki Hollub. Behind a paywall.  

The article begins:

When Vicki Hollub flew Occidental Petroleum’s Gulfstream V jet to Omaha for a meeting with billionaire investor Warren Buffett in April 2019, she needed cash to place a bet.

The $10bn cheque with which she emerged allowed her to outbid rival Chevron in an epic corporate battle to acquire Anadarko Petroleum, doubling Occidental, better known as Oxy, in size.

But the takeover saddled the company with debts totalling almost $50bn.

For the gamble to pay off, oil prices needed to remain elevated. Things quickly started to go wrong.

A little over six months later, as the Covid-19 pandemic upended the global economy, oil prices began a collapse in which the US benchmark would trade below zero — down as much as 177 per cent from the price on the day the Anadarko deal closed. Oxy’s stock was demolished by a market that had already soured on an industry that had burnt through investor cash in a series of debt-funded drilling sprees with little to show in the way of returns.

Critics panned Hollub for recklessness in ploughing ahead without regard for cost.

“It was the dumbest deal in history,” said one senior oil executive.

Almost four years later, Oxy is not only back from the dead, it is thriving. The company was the best performer on the S&P 500 in 2022, with its stock rising 119 per cent, as it reaped the rewards of elevated oil and gas prices in the wake of Russia’s invasion of Ukraine.

At noonish today

NVDA - February 27, 2023

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. 

A double in the last six months?

UNP -- February 27, 2023

Last night, I said the stock to watch Monday morning: UNP.

The Real Question Is Why? February 27, 2023

Ford, China: a disaster. Link to WSJ.

• there's a reason Ford doesn't publish a detailed breakdown of its China sales
• the market share for Ford’s largest joint venture in China, with Changan Automobile Co., shrank to 1% from 4% between 2016 and 2022, according to industry data and Changan-Ford’s company filings. 
• why?
  

Geo-Pollitical Photo Of The Year? February 27, 2023

Link here.

Investing -- Buffett -- Apple -- Oil -- February 27, 2023

Re-posting.

It appears a lot of folks missed this the first time around.

In addition, a certain reader might see another example of where earnings exceed revenues.

At the link:

Without question, this was the most interesting story this quarter; it has been posted previously but it looks like few are following it: link here.

Buffett also owns an under-the-radar stock portfolio worth $5.9 billion through Berkshire Hathaway. The portfolio is managed by New England Asset Management, which provides investment management services that are tailored to insurance companies.

New England Asset Management was acquired by General Re in 1995. Then, in 1998, Berkshire Hathaway acquired General Re for $22 billion, making New England Asset Management a wholly owned subsidiary of Buffett's conglomerate.

While Buffett has no influence over the $6 billion portfolio managed by New England Asset Management, the portfolio does have some striking similarities to Buffett's $300 billion stock portfolio.

For one, it's extremely concentrated, with its top 10 positions making up 92% of the portfolio. The top 10 holdings of Berkshire Hathaway's main stock portfolio make up 87% of its assets.

The top ten:

• Cisco: $9 million
  
• JP Morgan: $11 million
  
• Bank of New York Mellon: $12 million
  
• Microsoft: $13 million
  
• Diageo: $39 million
  
• HP: $410 million
  
• Chevron: $638 million
  
• US Bancorp: $668 million
  
• Bank of America: $687 million
  
• Apple: $2.84 billion

When one looks at that holding, one understands why Buffett sold what he sold from BRK in most recent quarter. It also shows that Buffett owns even more AAPL than most might think. 

Although $3 billion AAPL in this portfolio pales in comparison to Buffets overall $140 billion AAPL. 

Investing -- Fifteen Visuals -- February 27, 2023

Fifteen visuals: link here.  

Legacy Fund Deposits -- February, 2023

Legacy Fund.  Legacy Fund financial statements.   

The Race to Debottleneck U.S. LNG Feedgas Routes -- RBN Energy -- February 27, 2023

 RBN Energy: the race to debottleneck US LNG feedgas route. Archived.

LNG exports will be the biggest driver of demand growth for the Lower 48 natural gas market over the next five years.

After a year of oversupply in 2023, export capacity additions will help to balance the market and support gas prices in 2024 as the glut spills over into next year.

Beyond 2024, higher export volumes will lead to tighter balances and price spikes. As supply struggles to keep up with new export capacity, the timing of pipeline expansions will be critical for balancing the market

The bulk of new LNG export projects are sited along a small stretch of the Texas-Louisiana coastline and more pipeline capacity will be needed to move incremental feedgas into this area and across the “last mile” to the facilities. In today’s RBN blog, we begin a series delving into the planned pipeline expansions lining up to serve LNG demand along the Gulf Coast.

Sixteen Wells Coming Off Confidential Over Weekend; Might WTI Open "Green" Today? February 27, 2023

Top story of the day: Saudi, Ukraine.

• geopolitics
• Covid, WSJ, DOE
• China, Russia, Saudi, US
• photo of the day.
  

Covid, WSJ, DOE: well played.

• obviously "no one" read past the headline; LOL.
• P. T. Barnum comes to mind
  

Coal:

• energy transition is dead; we just don't know it yet -- Peter Zeihan;
• China: link here.
• the numbers are staggering
• thumbing their nose at Kyoto, Paris, Biden, Kerry
  

Credit card debt: the saga continues.

• lots of graphs (yes, we get it, enough with the graphs already): where's the analysis?

Ford, China: a disaster. Link to WSJ.

• there's a reason Ford doesn't publish a detailed breakdown of its China sales
• the market share for Ford’s largest joint venture in China, with Changan Automobile Co., shrank to 1% from 4% between 2016 and 2022, according to industry data and Changan-Ford’s company filings.
  

Investing:

• graphs

Buffett:

• the knives are out.
• has BRK become a meme stock?
  

Energy: among top ten stories of the year.

• WTI subsumes Brent;
• this is a biggie
• eleven -- count 'em -- eleven US Gulf Coast terminals --> WTI to Brent
• Dated Brent: WTI, Brent, Forties, Oseberg, Ekofisk, Troll.
  

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

Active rigs: 44.

Peter Zeihan newsletter.

WTI: $76.43 (green).

Natural gas: $2.597 (green, by 2%).

Monday, February 27, 2023: 84 for the month; 155 for the quarter, 155 for the year
39088, conf, CLR, Colette 5-18H,
39019, conf, Lime Rock, Yellowstone 12H,
38743, conf, Ovintiv, Sorenson Federal 153-96-9-4-11H,
38404, conf, Kraken, Sidney 32-29 2TFH,
36050, conf, Oasis, Foley Federal 5301 12-13 3B,

Sunday, February 26, 2023: 79 for the month; 150 for the quarter, 150 for the year
39087, conf, CLR, Colette 4-18H,
39018, conf, Lime Rock, Yellowstone 11H ,
38693, conf, Enerplus, Lob 149-92-31D-30H-LL,
38428, conf, Whiting, Nesheim 11-24HU,
38405, conf, Kraken, Sidney 32-29 3H,
38343, conf, Enerplus, Ace 149-92-31D-30H,
36048, conf, Oasis, Achilles 5301 12-13 3BX,

Saturday, February 25, 2023: 72 for the month; 143 for the quarter, 143 for the year
39017, conf, Lime Rock, Yellowstone 10H,
38742, conf, Ovintiv, Sorenson Federal 153-96-9-4-10H,
38406, conf, Kraken, Sidney 32-29 4TFH,
8029 (no typo), conf, Empire North Dakota, Romsos 1-21,

 RBN Energy: the race to debottleneck US LNG feedgas route. Archived.

LNG exports will be the biggest driver of demand growth for the Lower 48 natural gas market over the next five years. After a year of oversupply in 2023, export capacity additions will help to balance the market and support gas prices in 2024 as the glut spills over into next year. Beyond 2024, higher export volumes will lead to tighter balances and price spikes. As supply struggles to keep up with new export capacity, the timing of pipeline expansions will be critical for balancing the market. The bulk of new LNG export projects are sited along a small stretch of the Texas-Louisiana coastline and more pipeline capacity will be needed to move incremental feedgas into this area and across the “last mile” to the facilities. In today’s RBN blog, we begin a series delving into the planned pipeline expansions lining up to serve LNG demand along the Gulf Coast.