- Knife River spinoff from MDU Resources
- spinoff to occur second quarter, 2023
- NYSE: KNF
- stockholders to retain current shares of MDU Resources
- to receive a pro rata distribution of 80.1% or more of the outstanding shares of KNF stock
Friday, March 10, 2023
Knife River Update -- March 10, 2023
Biden Set To Approve Willow -- March 10, 2023
Willow: Biden to approve 3-well project -- Bloomberg. Link here.
**************************
Back to Relaxing
Poolside: high today, 66°F. Right now, 6:10 p.m. CT, it's 64°F. Calm, perfectly calm -- beautiful evening. Do a little blogging, a little reading a little thinking.
Banks: all of a sudden, they look a bit vulnerable, don't they? I doubt Silicon Valley Bank was the only bank in this situation, although it may have been the most extreme example. All things being equal, I guess I would rather have my assets backed by oil in the ground.
Speaking of which, oil had an "okay" day.
A Lot Of Activity In Bismarck: Ten New Oil And Gas Permits; Fourteen Permits Renewed -- March 10, 2023
Active rigs: 44.
WTI: $76.68.
Natural gas: $2.430.
Ten new oil and gas permits, #39718 - #39720, inclusive; and, #39722 - #39728, inclusive:
- Operators: Kraken (3); WPX (7)
- Fields: Oliver (Williams); Reunion Bay (Dunn)
- Comments:
- WPX has permits for seven Bull Moose wells, SESW 28-150-93;
- to be sited between 297 FSL and 446 FSL and between 1288 FWL and 1389 FWL;
- Kraken has permits for two Blaine wells and one Sutton well, SWSW 34-158-98,
- to be sited 425 FSL and between 11182 FWL and 1248 FWL
Fourteen permits renewed:
- CLR (11): six Plano FIU and four Gibb permits, all in Baker, Williams County;
- Murex (3): Iner Skari, Laura Skari, and Vernon E Skari permits, all in Sandrocks, McKenzie County;
Week 11: March 5, 2023 -- March 11, 2023
The top stories:
- Silicon Valley Bank: fails. Biggest bank failure since 2008.
Top story:
- Joe Biden is still president.
Top international non-energy story:
- Ukraine war continues.
Top international energy story:
Top national non-energy story:
- Record employment continues.
- Two more California companies move to Dallas, Texas.
Top national energy story:
- Biden set to approve limited Willow project; COP, Alaska. Bloomberg.
Javier Blas:
Focus on fracking: most recent edition.
Top North Dakota non-energy story:
Top North Dakota energy story:
Geoff Simon's top North Dakota energy stories:
Bakken economy:
- Chugging along.
Commentary:
Entertainment:
Sara Eisen -- CNBC -- March 10, 2023
A "crisis" gives folks a chance to jump to the head of the pack.
In the SVB fiasco today, the individual that is really, really shining: Sara Eisen.
Good for her.
She gets it.
She knows how bad this is going to get.
While "everyone" else is still asking whether this is a "one-off" and whether JPow has to pivot, she has already answered that question:
- this is not a one-off; and,
- a rate increase of 50 basis points in March, 2023, is now off the table.
This is not a one-off: already several other regional banks are showing huge losses in their share prices, and, worse, there are indications that folks are going to their bank today -- a Friday, by the way -- to pull their money out of their savings accounts and put it into CDs or Treasuries.
********************
Will This Bank Failure Affect Rivian's Offer?
Rivian's offering:
- $1.3 billion
- 4.625%
- will settle March 10, 2023
- due 2029
"My Mom And Your Mom" Caused The SVB Fiasco -- March 10, 2023
WOW, WOW, WOW: I wrote this yesterday and today it's on CNBC and it's the reason SVB is in trouble. Savers like "my mom and your mom" are / were withdrawing their money from their banks -- "a run on their banks" -- to buy CDs. Wow. What a great blog. LOL. Link here.
A reminder, my favorite chart:
I remember the "push back" I got when I first posted this graphic, many, many months ago. LOL. Paying attention to details.
From yesterday:
************************
Mother Goose
Advice for today:
Jack Sprat could eat no fat.
His wife could eat no lean.
And so between them both, you see,
They licked the platter clean.
A "talking head" on CNBC repeated the meme: with interest rates this high, bonds are competing with stocks.
My mother knew nothing about investing and kept all her money in cash, money market accounts, and occasionally CDs. She was thrilled with 14% interest rates in the 1980s (?).
My father, whether he knew anything about investing or not, I don't know. He always said it was always better to be "lucky" rather than "smart." He did incredibly well in the market despite no formal training and no informal education with regard to investing. I don't think he ever read a book on invested, and ever read The WSJ. About all he did was watch the CNBC crawler ten minutes every day while checking the day-old Bismarck Tribune "money section."
But he did most of his investing during a multi-decade bull market. He never invested in Treasuries or bonds; he only invested in stocks.
Both mom and dad ended up financially quite well off, probably better than most.
So, for mom, bonds did not compete with stocks. Bonds competed with cash under her mattress.
For dad, stock did not compete with bonds. AAPL competed with SLB for his dollars.
And it continues in the next generation. For my wife, the money market accounts compete with cash in her savings account; and, for me AAPL competes with DVN for my dollars.
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.
Breaking: Literally And Figuratively -- Watching It In Real Time -- This May Not Be A One-Off March 10, 2023
SVB: I'll have to wait for the book.
How much will this affect California budget. Remember: 1% of California taxpayers account for 49% of all California revenue.
MOST IMPORTANT BANK IN THE SILICON VALLEY JUST FAILED -- California regulators shut down the bank!
Half of all venture capital money in the San Francisco Bay area goes through this bank. Huge bank for Chinese companies.
Breaking: SIVB trading -- halted. 8:00 a.m. CT -- March 10, 2023. Already trying to sell itself -- and apparently those attempts not going well.
SIVB: wiki --
On 9 March 2023, shares of SVB Financial plunged more than 62% after the company proposed a share sale to shore up its balance sheet which had suffered a $1.8 billion loss on Treasuries due to rising inflation.
SIVB: link here.
- Pre-market: down another 44%. Could open under $60. [Later: could open under $35. Some feel that SIVB is NOT a one-off.]
- Culprit: Treasuries.
- Five days, from $275 to $106.
- Cryptocurrency: pending.
- JPow's third big problem. Credibility.
He's publicly committed to 2% inflation rate. "Everyone" knows that's impossible and in a modern economy like the US, a 2% inflation rate is fantasy and, in fact, is actually detrimental to the well-being of the nation and the working class. A two-percent inflation rate could be seen by some as a personal vendetta for JPow and that he is willing to take the nation down if he has to, to get to 2%. It will be interesting to see if JPow will moderate his statements at risk of "negative" headlines on "flip-flopping."
Busy, Busy, Busy Day -- TGIF -- March 10, 2023
Updates
Whatever happened to Erin Burnett? The cable ratings. From here to obscurity. Link here.Chips: updating the semiconductors. Link here. INTC: too little, too late?
JPow's two big problems. a run on banks and the implosion of cryptocurrency. Link here.
- SIVB: link here.
- SVB: wiki.
- Pre-market: down another 44%. Could open under $60. [Later: could open under $35. Some feel that SIVB is NOT a one-off.]
- Culprit: Treasuries.
- Five days, from $275 to $106.
- SIVB: wiki --
On 9 March 2023, shares of SVB Financial plunged more than 62% after the company proposed a share sale to shore up its balance sheet which had suffered a $1.8 billion loss on Treasuries due to rising inflation.
- Cryptocurrency: Silvergate Capital.
- JPow's third big problem. Credibility.
He's publicly committed to 2% inflation rate. "Everyone" knows that is impossible and in a modern economy like the US, a 2% inflation rate is fantasy and, in fact, is actually detrimental to the well-being of the nation and the working class. A two-percent inflation rate could be seen by some as a personal blood feud for JPow and that he might be willing to take the nation down if he has to, to get to 2%. It will be interesting to see if JPow will moderate his statements at risk of "negative" headlines on "flip-flopping."
AAPL and what it will buy next? No one knows. Link here.
Lego. Update.
EVs. Lordstown, and GM. Link here.
- Big rigs: Daimler, Cummins, and Navistar taking the early lead. Link here.
LNG. The 21st century -- America's century. Link here.
Copper. Copper demand forecast to increase 600% by 2030. Link here.
Best buy of the day. In the past two weeks, a 2-liter bottle of Diet Coke went from $2.59 to $2.79 to $2.99. But yesterday at Market Street, Colleyville, a 2-liter bottle of Zero Coke was on sale for $1.79. Yes, I stocked up. Two. LOL.
Original Post
Jobs report today:
- up 311K vs 225K estimate.
- unemployment rate: 3.6%; up from 3.4%.
- 0.2% increase vs 0.3% to 0.4%: average hourly wage increase, m/m; one of the smallest ever
- Steve Liesman:
- yada, yada, yada -- good in terms of putting folks back to work
- not sure why unemployment number rose
- the market likes these numbers; Dow goes from minus 90 to positive 20, back to minus 40 back to plus 30.
Most analysts track U-3. Not me. U-1. Link here. If one actually looks at the definitions of the various categories, one will understand why I prefer U-1.
High on my list for today:
- Whatever happened to Erin Burnett? The cable ratings.
- Chips: updating the semiconductors.
- JPow's two big problems. a run on banks and the implosion of cryptocurrency.
- JPow's third big problem.
- AAPL and what it will buy next?
- Lego.
- EVs.
- LNG.
- Copper.
Comments on the above.
- Huge fail. Erin's move to obscurity.
- Wiki has new numbers for chips.
- CNBC starting to sound frantic. Government talking heads are telling us to stay calm. Never a good combination.
- Credibility.
- No one knows.
- Folks have a lot of money to spend on plastic bricks.
- More and more it looks like 2023 is the "make or break year" for EV manufacturers. Rivian may be the biggest surprise.
- The 21st century: America's century.
- The numbers are simply surprising.
***********************
Back to the Bakken
Active rigs: 44.
Peter Zeihan newsletter.
WTI: $75.13.
Natural gas: $2.484.
Sunday, March 12, 2023: 39 for the month; 201 for the quarter, 201 for the year
39138, conf, CLR, Micahlucas 7-5H,
39130, conf, Crescent Point Energy, CPEUSC Claire Rose 4-31-30-159N-99W-MBH,
Saturday, March 11, 2023: 37 for the month; 199 for the quarter, 199 for the year
39131, conf, Crescent Point Energy, CPEUSC Amelia Grace 4-6-7-158N-99W-MBH,
39137, conf, CLR, Micahlucas 6-5H1,
39132, conf, Crescent Point Energy, CPEUSC Claire Rose 3-31-30-159N-99W-MBH,
RBN Energy: how much will price impact future US crude production growth? Archived.
For the first 10 years of the Shale Revolution, it was a foregone conclusion: High prices stimulated more drilling, and more drilling meant higher production. It worked in both directions. When prices crashed, so did production. The correlation was great. The relationships were right on cue in 2014-15 when $100/bbl crude crashed to $30, rebounded to $60 by 2019, and wiped out in 2020 when the COVID meltdown hit.
But then the market shifted. As prices ramped up in 2021 — eventually to astronomical levels in 2022 — the phenomenon of producer discipline kicked in, with E&Ps capping their drilling programs and returning a significant slice of their rising free cash flow to their shareholders.
The near-term market implications of this new dynamic have been extensively documented in the RBN blogosphere. But what does it mean for the future? Especially for intrepid energy analytics companies (like RBN) that, by necessity, must project producer behavior far into the future to determine what production will look like next year, next decade and even further over the horizon. In this new RBN blog series, we will examine that dilemma, the assumptions RBN makes, and what our forecasts for the next few years look like.
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