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Monday, May 22, 2023

Are You Getting As Tired Of Janet Yellen As I Am? May 22, 2023

NBA: Denver Nuggets sweep the LA Lakers.

Updates

May 23, 2023: I see "Biden considers 14th amendment" as a Yahoo!Finance headline today. Biden knows Washington politics very, very well. First, this data point: more and more Washington insiders are beginning to question Janet Yellen's "June 1, 2023" as the "x-date. These insiders will argue that Janet Yellen is not the sharpest knife in the drawer; she often seems out of the loop; she is a politician and loyal Democrat above all else, except perhaps to "preserve" her own legacy; and, as such, these insiders are starting to question Yellen's "crying wolf" speeches. Whether one wants to "believe" these insiders or not, it is a fact that her date seems very nebulous. It's always "on/about/before" without providing hard numbers to reporters.

My hunch: the US Treasury knows exactly what money is scheduled to come in on any given day for the next 30 days. The US Treasury also must know exactly what money is scheduled to go out on any given day for the next 30 days. It would be impossible for any "new pop-ups" because it would require US Congress to authorize more spending. 

I'm sure that Yellen has provided the Biden administration the best estimate for "x-day."

Now, back to Biden. As I was saying, he knows Washington politics very, very well. 

Invoking the 14th amendment, it's binary. Either he is serious or he is not.

If he's not serious, it's simply a rhetorical tool to keep the opposing party off balance. A distraction at worst.

If he's serious, he knows that legal ramifications are also binary: the courts will either rule invoking the 14th amendment is constitutional or it is not. If the courts rule in his favor, the whole thing becomes moot. 

Regardless, Biden knows the judicial process takes a bit of time, and the government has already stated they expect quarterly tax money to start arriving in mid-June which pushes the "x-date" out even farther. If enough money comes in, he can "pull back" on the 14th amendment, the courts drop the case, and we move on to the next deadline.

May 23, 2023: on May 23, 2023, I wrote: 

Debt ceiling:

  • talks not going well;
  • most concerning: 
    • GOP leadership not able to frame “their” message;
    • Do the GOP even have a message?
    • do MAGA Republicans see blood in the water?
  • 14th Amendment; section 4.

Original Post

Locator: 44727DEFAULT.

How many times does Janet Yellen have to tell us the US could default as soon as June 1, 2023. 

We get it. And "we" don't matter.

The negotiators know what's going on. That's all that matters.

One can do the calendar-math.

X-day.

X-day-1: same day / one day before -- President Biden signs the document to raise the debt ceiling.

X-day-2: two days before x-day, US Congress passes whatever they need to pass to raise the debt ceiling.

X-day-5: agreement between US House and President Biden printed and distributed to members of US Congress. US Congress has 72 hours to read the document.

X-day-6: agreement between US House and President Biden reached. Handshake. Photo-op. All smiles.

So, now, put some calendar dates against "X-day."

X-day: May 31, 2023, per Janet Yellen.

May 31, 2023 - 6 days = May 25, 2023. 

Today, is May 22. We have three more days.

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On The Balcony

It is an incredibly nice evening.

Nice breeze. Probably 75°F. Sun setting. [Just checked: it's 78°F.]

Listening to great YouTube music.

It would be hard to beat this.

Asteroid City opens June 23, 2023. I'll go by myself. 

Chord-XTO Deal? May 22, 2023

Locator: 44726CHORD_XTO. 

Full story here (and re-posted below).

Previously posted. 

Locator: 44691B. 

Chord Energy: to bulk up in the Bakken, divest non-core, Hart EnergyChord Energy website. A reminder: Chord Energy: Whiting + Oasis.

Is this new or is this an old news story? One never knows with Hart Energy.

Let's see if we can find any other source. I can't find anything else. I haven't checked Chord's website yet.

Link here.


From the link:

Chord Energy Corp. has strengthened its position in the Williston Basin with an agreement to acquire core acreage from Exxon Mobil Corp. subsidiary XTO Energy Inc. and affiliates for $375 million cash.
The acquisition was announced May 22, 2023, as Chord sheds non-ore acreage outside the basin.

Disclaimer: I am building a position in Chord, but not increasing my overall fossil fuel position. I am selling other energy assets to pay for additional investments in Chord.

Abbreviated 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. Full disclaimer at tabbed link.

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
.
  

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Updated Here

Hart Energy tweeted this yesterday (May 22, 2023). Now, more background, from stories posted May 23, 2023.

From EnergyIntel.com.

Bottom line:

  • only 20% of Exxon Mobil's Bakken assets in the deal
  • $375 million

From WorldOil.com.

  • Chord to pay with cash on hand
  • Chord had $592 million in cash on March 31, 2023

From okenergytoday.com.

  • 62,000 acres
  • 77% of this acreage is undeveloped

Back-of-the-envelope:

  • $375 million / 62,000 acres = $6,000 / acre
  • $375 million / 6,000 boed = $62,500 / boepd flowing
  • 20% of what = 62,000 acres; XTO acreage before sale: 310,000 acres

One wonders if most of the acreage in the deal was "outside" the reservation? 

Zacks is best link right now.

  • the acquisition allows Chord Energy to expand six of its pre-acquisitiono drilling spacing units from two miles to three miles
  • acreage, fully held by production
  • Chord estimates: 123 net 10,000-feet equivalent locations
  • low base decline rate of 23%
  • oil: 62% of net production from acquired assets

From this blog, but I quit following XTO almost ten years ago:


XOM (XTO)

 

 

Life-Size Ferrari Replica -- Lego -- Denmarck -- May 22, 2023

Locator: 44725LEGO.

Link here.

For the record, I am building a position in RACE.

In my "new-money" allotment (50-40-5-5). RACE is part of the 5% that is targeted for EVs. 

No "new-money" goes into fossil fuel energy.

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

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Jiu-Jitsu

After tonight's session was over, I mentioned to Sophia that early in the match, she was crushing her opponent's jaw with her forearm. She replied, "Yes, that's my signature move."

I also mentioned that in the latter half of the match, she almost separated her opponent's head from his torso with a spring-loaded kick that was disarming (or beheading) to say the least. I think had this been a real attacker who meant Sophia harm, she could have severely injured him. She said that was also one of her better moves and demonstrated how she did it.

 Just saying.

Dashboards For May, 2023

Locator: 44723B.

I believe this is the third consecutive month in which we see "down arrows" for the Permian and the Eagle Ford, but "up arrows" for the Bakken.

EIA dashboards:




 

 

WTI Back To $72; Two New Permits; Three Permits Renewed; Four DUCs Reported As Completed -- May 22, 2023

Locator: 44722IB.

Active rigs: 37.

WTI: $71.99.

Natural gas: $2.401.

Two new oil and gas permits, #39913 - #39914, inclusive:

  • Operator: MRO
  • Field: Killdeer (Dunn County)
  • Comments:
    • MRO has permits for a Rooney well and an Osmund well, SWSE 9-145-94; 
      • to be sited as such: Rooney, 576 FSL and 1826 FEL; and Osmund, 576 FSL and 1786 FEL;

Three permits renewed:

  • Formentera Operations (2): a Bervik permit and a Lincoln State permit, both Skjermo oil field, Divide County;
  • SOGC (Sinclair): a Porcupine permit in Little Knife, Dunn County.

Four producing wells (DUCs) reported as completed:

  • 38128, 1,175 bopd, CLR, Dennis FIU 6-8H, Dunn County.
  • 38954, 667 bop, Ovintiv, Anderson Federal 152-96-9-4-5H, McKenzie County.
  • 38955, 956 bop, Ovintiv, Anderson Federal 152-96-9-4-6H, McKenzie County.
  • 38956, 816 bop, Ovintiv, Anderson Federal 152-96-9-4-13H, McKenzie County.

Inflation Watch -- Eggs -- May 22, 2023

Locator: 44721INFL.
Locator: 44721BUD.

At Walmart this morning:

  • $1.24 / dozen / white -- lowest price for a dozen eggs; probably less if bought in volume
  • $1.36 / dozen / white -- store brand

From Barron's last month:

I know he was blamed for high price of eggs; I wonder if President Biden will get credit for bringing price of eggs down. There is some suggestion that eggs are valued / priced at less than $0.00 (no typo) but transportation costs, grocers / middlemen handling bring eggs to $1.30 / dozen.

The article above also helps explain why Costco was able to maintain prices on their rotisserie chickens, but it certainly suggests grocers were making a lot of money on those rotisserie chickens as they raised the prices from $5.99 / chicken to $9.99 / chicken this past year (at least in our regional grocery stores).

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Bud -- It's Even WorseThan I Thought

The WSJ had a very, very long article over the weekend on the Bud debacle. I did not link it or note it because the story was pretty well known; not much more to add. [Maybe I did post it; don't remember.]

One data point caught my attention but not enough to get me to post / link the article, but after getting a note from a reader today, I decided to post it.

The link: https://www.wsj.com/articles/bud-light-boycott-sales-dylan-mulvaney-6c23bb86?mod=hp_featst_pos5.

Anyway, this data point of interest, from The WSJ article, "how Bud Lite Blew It" and what it is doing to make amends:

The company is planning to have Bud Light sponsor a veterans group for the first time ever, the Journal reported. 

So, when Bud Light is/was trying to expand its consumer base, they went with Mulvaney first rather than with US military vets? 

Let's see, Memorial Day was on its radar scope when Bud Lite went with Mulvaney? Pride month was further out (June).

How long has Bud / Bud Lite been around? And all those decades Bud Lite has never sponsored a US veterans group! Holy mackerel. 

I was giving the benefit of the doubt to the two marketing execs who made the Mulvaney-face-on-a-can decision but no more. Not sponsoring a US veterans group all these years is beyond the pale, as they say, a true deal-breaker for me.

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Trump

Link here

To say the least, this certainly gets tiresome.

WSJ Headlines -- May 22, 2023

Locator: 44719INV. 

Headlines that caught my eye this a.m. -- from The WSJ

Ford's worst nightmare:


Europe's murder capital! Say what?


 

PDC Energy

DIS:

Big Pharma:

CVX To Buy PDC Energy -- May 22, 2023

Locator: 44718WTI.
Locator: 44718CVX_PDC. 

Oil and Gas Journal: link here.

Chevron Corp., has agreed to acquire PDC Energy Inc., Denver, in an all-stock transaction valued at $6.3 billion that would increase its production volumes by about 8%.

Total enterprise value of the deal, including debt, is $7.6 billion.

The deal adds low breakeven production and development opportunities adjacent to Chevron’s current position in the Denver-Julesburg (DJ) basin, as well as additional acreage in the Permian basin.

In the DJ basin, Chevron would gain 275,000 net acres adjacent to existing operations that add over 1 billion boe of proved reserves.

PDC operations in the basin are focused on horizontal Niobrara and Codell development in Wattenberg field in Weld County, Colorado. First-quarter 2023 production was 216,000 boe/d (60% liquids).

In the Permian basin, the deal gives Chevron 25,000 net acres that are held by production and will be integrated into Chevron’s existing development operations. PDC's operations in the basin are focused on the Delaware basin in Reeves County, Texas, primarily targeting Wolfcamp A and B development. In this year’s first quarter, the acreage produced about 28,000 boe/d (62% liquids).

Chevron expects to increase its capital spending by about $1 billion per year, raising its guidance to $14-16 billion through 2027, after realizing about $400 million in capital efficiencies post-closing, which is expected by end-2023.

Back of napkin (no one has posted this on the net yet; first post? TMDW. Whoo-hoo!):

  • $25,000 / net acre.
  • $31,000 / boepd (flowing at time of purchase)

CVX: to buy PDC Energy. $6.3 billion. 

PDC Energy: link here. This website will eventually disappear if PDC acquired by CVX.

Link here.



The Google Doodle -- May 22, 2023

Locator: 44717ND.

The Google Doodle: link here.


Whiz Bang: link to The Dickinson Press. Captain Billy's Whiz Bang.

Monday -- May 22, 2023

Locator: 44716B. 

Debt ceiling: some argue that a bill can't be passed and signed by June 1, 2023. 

The Google Doodle: link here.

NBA: can't wait to hear Steven A. talk about the playoffs over the weekend.

UNP: declared dividend. Unchanged.

Ticker in the news: CRH.

CVX: to buy PDC Energy. $6.3 billion. 

Lithium, brine: link here. Mississippi Lime tracked here.

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Back to the Bakken

Active rigs: 35.

WTI: $71.90.

Natural gas: $2.518.

Peter Zeihan newsletter.

Tuesday, May 23, 2023: 37 for the month; 89 for the quarter, 344 for the year
37850, conf, Slawson, Genekat Federal 6-13-12TFH,
37849, conf, Slawson, Loon Federal 3-24-35H,

Monday, May 22, 2023: 35 for the month; 87 for the quarter, 342 for the year
38854, conf, Whiting, Littlefield 11-21HU,
37851, conf, Slawson, Loon Federal 6-24-25TFH,

Sunday, May 21, 2023: 33 for the month; 85 for the quarter, 340 for the year
38970, conf, Hess, GO-Aslakson-156-97-2734H-3,
37852, conf, Slawson, Loon Federal 7-24-25TFH,

Saturday, May 20, 2023: 31 for the month; 83 for the quarter, 338 for the year
39287, conf, CLR, Smouse 9-28H,

RBN Energy: clash over force majeure in the natural gas industry's master sale and purchase agreement.

The NAESB Contract is a familiar element in the day-to-day dealings between natural gas buyers and sellers in the U.S. — a standard form that serves as a useful draft for short- and long-term gas supply agreements — just fill in its blanks and use it, or adjust it until you have a deal. Winter Storm Uri, the devastating deep-freeze event that brought much of Texas to an icy standstill and a deadly blackout in February 2021, raised all kinds of questions about how to interpret the contract’s boilerplate force majeure provisions. As part of the aftermath, some electric industry participants (primarily in other states, not Texas) are pushing at NAESB for changes to the force majeure provisions with the aim of clarifying things and maybe reducing their use to forgive a failure for gas to show up. But nothing is uncomplicated in the world of contracts and force majeure, as we discuss in today’s RBN blog.

Grayson Mill State 36-1 1-H, Stony Creek, Update -- May 22, 2023

Locator: 44715B. 

There's a "theory" out there that says this is not supposed to happen.

The well:

  • 18307, 3,236, Grayson Mill/Statoil/BEXP, State 36-1 1-H, 3,236, s10/09; t1/10; cum 302K 11/14; cum 438K 3/23;

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN3-202324837085376624513280103892851
BAKKEN2-202328216922234812328933164794725061
BAKKEN1-2023386308528243402380
BAKKEN12-20220000000
BAKKEN11-20220000000
BAKKEN10-20220000000
BAKKEN9-20220000000
BAKKEN8-20221045687047844436678
BAKKEN7-20222915641710115314661127339
BAKKEN6-2022291197113711929528638

Initial production:

BAKKEN6-2010269460968269001148959185549
BAKKEN5-2010271184012101718116933114675171
BAKKEN4-201030121661202868451512281656957
BAKKEN3-2010281333413760809115763104935270
BAKKEN2-2010281737316665108371926618677589
BAKKEN1-20103139968388373422716979213814841
BAKKEN12-20096206320638058213821380