The Book Page -- India -- Just The Beginning -- November 20, 2024

Locator: 44368INDIA.

Why is this important?

Next: where does Apple plan to place its factories?

For the archives. This will be tracked elsewhere. But this is the beginning of my notes on India. 

For the blog: a reader asked his followers what book they planned to read by the end of this year, 2024.

My response: India: A History, John Keay, c. 2000, 2010.

“John Keay’s India: A History earned wide acclaim as the greatest single-volume book about India, Pakistan, and Bangladesh when it was [first] published in 2000. It has now (2010) been fully revised with four new chapters that the reader up to the region’s present day.

“India: A History spans five millennia in a sweeping narrative that tells the story of the peoples of the subcontinent, from their ancient beginnings in the valley of the Indus to current events in the region.

“In charting the evolution of the rich tapestry of cultures, religions, and peoples that comprise the modern nations of Pakistan, India, and Bangladesh, Keay weaves together insights from a variety of scholarly fields to create a rich historical narrative. Wide-ranging and authoritative, India: A History is a compelling epic portrait of one of the world’s oldest and most richly diverse civilizations.”

I would assume that somewhere along the line Steve Jobs and Tim Cook (metonyms for the entire C-suite of the Apple corporation) were given intense briefings on the history of China and  India.

Of the two, the India briefing would be the most interesting, the most complicated and the most challenging for the presenter to put together.

The US is one country: politically, economically, culturally, socially.

China is one country: politically, economically, culturally, socially.

India is not one country. India is a land mass with 36 Indian sub-continent countries (28 states and 8 union territories). The 28 states have their own governing body; the eight union territories are administered by the central government (think District of Columbia in the US).

In the US one can move from Boston to Los Angeles to Dallas to Spokane and “fit in” immediately. No new language; no new religion; no new nothing. At most, politically from red to purple to blue or vice versa.

I assume it is quite similar in China. I could be wrong. Probably am.

But India: 36 Indian countries. Moving from one Indian country to another Indian country means a new language, a new culture, a new religion, and  unless it’s a union territory, a new political system.

Do not take this out of context.

Instead of one Chinese country with one party, the Communist Party with one clear-cut leader, or one American country with one president “straddling” two political parties, India has 36 countries gerrymandered based on language.

The Indian subcontinent has 18 official languages. Most Indian states / territories have a single official language. Some have two or a few more. One state has one official language and sixteen additional unofficial languages. Another state has a corresponding two and eleven; and a third state has a corresponding four official languages and eight unofficial languages.

Five states and one territory have English as an official language. English is the only official language in one state and in one territory.

The second bullet for the brief for Tim Cook: there are only two important dates in Indian history —


• 1947: independence of the Indian subcontinent; and,
• 1956: the Indian subcontinent completely reorganized into states and territories based on the language used in that locale.

A third date is, perhaps, also important: separation dates of Bangladesh and Pakistan from “India.”

So, two initial bullets:
India does not exist as a country (as Americans would define a country), 
the Indian subcontinent has 28 states and eight union territories “organized" by language. 
there are only two important dates in the Indian subcontinent for outsiders to know: 1947 and 1956

The third bullet: geographically —

• the Indian subcontinent is the size of Europe with none of the geographic diversity of Europe

• the Indian subcontinent is boring with the same relatively dry, flat land north to south, east to west
• think of the United States from, perhaps, Indiana to Utah, without the rivers and the lushness, or Americans would say, “fly-over country."

The fourth bullet: know the state / union territory in which you plan to do business --

• 
the major urban center(s)
language
• religion
• politics
• economic system
• what that “country” (state or union territory) brings to the table

And that’s it.

Geographically, the map:

• Although the size differences are entirely different, overlay a map of the US island of Manhattan over the entire Indian subcontinent.
• mountains separate Manhattan from Canada (Himalayas — northeast; and, Kirthar Range — northwest)

• the Hudson River is the Arabian Sea
• the East River is the Bay of Bengal
• there is no counterpart to Long Island 

• Delhi / New Delhi is in the Bronx — perhaps close to where the NY Mets call home
• Bombai (Mumbai) is on the Hudson across from New Jersey
• Tamil Nadu is the Manhattan Battery
; Tamil Nadu is the Silicon Valley of India
  
• Sri Lanka would have the Statue of Liberty
• West Bengal (and Bangladesh)  would be Westchester on the way to Connecticut, Yale, and Rhode Island
• Calcutta: West Bengal (the far northeast)
• Bhopal: geographic center of subcontinent India; perhaps Harlem?
• Pakistan: Pennsylvania

• Afghanistan: upstate New York
• Nepal: north of the Bronx
• Tibet: north of Nepal

So, four mountain ranges:

• northwest (Kashmir)
• northeast (Himalayas)
• western Ghats
• eastern Ghats

Calcutta -- west Bengal:

The states / union territories of note:

• 
Delhi / New Delhi: a union territory (need to check) squeezed in between Haryana and Uttar Pradesh
• Calcutta: West Bengal

• Bombay (Mumbai): Maharashtra
• 
Madhya Pradesh: Bhopal

AI:

History:


• history as John Keay divides the chapters of his book
“no" history until fairly recently
Pre-1750; pre-British colonization
• 13th century AD, Islamic conquest but very biased and often unhelpful
• The British Conquest, 1750 - 1820
• US Civil War - War of 1812
• Pax Britannia: 1820 - 1880
American expansionism
Awake the Nation: 1880 - 1930
American railroads
US Labor Movement
• At the stroke of the Midnight Hour: 1930 - 1948
WWII
• Ghandi
• Surgical Procedures: 1948 - 1965
US post-WWII
US Civil Rights movement
India: massive reorganization
• The Spectra of Separatism: 1962 - 1972
• Vietnam
Bangladesh
Pakistan
• Demockery (sic): 1972 - 1984
Bangladesh
• Pakistan
• Midnight’s Grandchildren: 1984 —
• the end of the Cold War
• immense changes in global alliances 

The Raj! Changed everything.

NDIC Reporting That Enerplus Has Renewed Four Hess Permits -- Link To Earlier Deal Provided; No New Permits; Five DUCs Reported As Completed -- December 10, 2021

Days supply, US crude oil, link here:

• first week of December: has dropped to 27.7 days
• previous week: 27.9 days
• before that: 28.3 days

Enbridge dividend: Michael Fitzsimmons overs at SeekingAlpha.

• Somewhat unfortunately, I became an Enbridge shareholder when the company bought natural gas pipeline specialist Spectra Energy.
• I say unfortunately because while dividend growth has been good (until this year.), capital appreciation has been - like many energy companies - pretty much non-existent.
• The stock has been very weak after this week's 3% dividend increase. It should be - the payout ratio is too low.
• The good news for shareholders is that the current cap-ex plan for FY2022 is much more pragmatic. No more "pushing on a string" on big pipeline projects that get delayed for years in court. 

If the writer is unhappy with Enbridge, he should check out Apple (AAPL). 

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Back to the Bakken

Active rigs:

$71.67	12/10/2021	12/10/2020	12/10/2019	12/10/2018	12/10/2017
Active Rigs	31	15	54	64	53

No new permits.

Four permits renewed:

• See this link: https://themilliondollarway.blogspot.com/2021/04/40000-acre-permian-vs-4000-acre-bakken.html
• Enerplus: four LK-Quilliam permits in Dunn County. These permits were originally Hess permits; Enerplus has renewed these four "previous-Hess" permits.
• the wells will be sited in SESW 11-147-97; 

Five producing wells (DUCs) completed:

• 37654, 3,145, MRO, Albert USA 31-5TFH,
• 36219, 1,595, Grayson Mill, Jake 2-11F 8H, Last Chance, no production data,
  
• 37415, 1,317, Kraken, Redfield Central LW 24-13 1H,Lone Tree Lake, no production data,
  
• 37887, 159, Crescent Point Energy, CPEUSC Burgess 2-14-23-158N-100W-MBH, Winner, no production data,
  
• 37884, 123, Crescent Point Energy, CPEUSC Burgess 3-14-23-158N-100W-MBH,Winner, no production data,
  

Definitive rig report: some notable observations --

• 31 active rigs being reported by the NDIC
• T&S Drilling 2 is new: Ballard Petroleum, Smalls 31-8, Bottineau;
• CLR with ten active rigs

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Four Hess Permits Renewed By Enerplus

Scout ticket: one of four LK-Quilliam permits originally issued to Hess:

In the Friday, December 10, 2021, NDIC daily activity report: these "former Hess" permits were renewed by Enerplus:

Blogging Delayed -- September 18, 2018 -- 100% Of Wells Coming Off Confidential List Today -- To DUC Status

Trump wins again: Germany will import US LNG. Won't amount to much in the short term, but over time ... who knows?

Boom! Bismarck developer lays plans for 2,800-home community. Huge story.

That didn't last long: those "green" decals in California. LOL. See bottom of the post.

Amazon: this is pretty cool. Last week I mentioned the Amazon vans in our neighborhood. Now this story tonight: Amazon just ordered 20,000 new vans.

Strange, strange day:

• Dow (irrelevant) futures up 88 points
• Trump announces more tariffs on China, and threatens to increase them by year-end -- only three months from now
• Chinese stock market in free fall
• Chinese billionaires losing billions
• waiting for news of Chinese bankers jumping out of windows
• WTI flirting with $70 again
• UNP up an astounding4.17% in pre-market trading; up $6.54/share
• headline: 2/3rds of Prime members would bank with Amazon -- maybe Amazon and Schwab will team up
• OAS, NOG could have a huge day
• wow, SRE up over 1%, and now trading above $120
• ever since it was publicly released that Warren sold some of his COP (after the initial few days), COP has gone higher; meanwhile AAPL dropped like a rock yesterday; AAPL will trade a bit higher today

Disclaimer: 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.

Blogging delayed: I was at Starbucks this morning at 6:00 a.m. or so, arriving by bike before sunrise. Unable to get connected to wi-fi.

Finally biked over to McDonald's -- got on to wi-fi immediately. So, I'm already behind.

Usually when I'm this far behind, it's not even worth blogging for the day.

So, we'll get started when we get started.

Very, very busy at McDonald's. Line very, very long.

Simply ordered on the kiosk and lo and behold, my order delivered to me a few minutes later.

Wells coming off the confidential list today: Tuesday, September 18, 2018

• 34562, SI/NC, Abraxas, Ravin 10H, North Fork, no production data, 
• 34559, SI/NC, XTO, Bobcat Federal 11X-2F2-S, Bear Creek, no production data,
• 33739, SI/NC, Hess, BB-Federal B-151-95-2122H-6, Blue Buttes, no production data,
• 31771, SI/NC, BR, Sanvan 8-1-29UTFH-ULW, Elidah, no production data,

Active rigs:

$69.84↑↑	9/18/2018	09/18/2017	09/18/2016	09/18/2015	09/18/2014
Active Rigs	66	56	32	67	199

RBN Energy: the crude oil hub at Cushing -- who owns what; how it's used.

The crude oil hub at Cushing, OK, has more than 90 MMbbl of tankage, 3.7 MMb/d of incoming pipeline capacity and 3.1 MMb/d of outbound pipes. That’s an impressive amount of infrastructure by any standard. The real marvel of the place, though, is the variety of important roles it plays and services it provides for a wide range of market participants — producers, midstream companies, refiners and marketers, as well as producer/marketer and refiner/marketer hybrids. To truly understand Cushing — what it does and how it works — you need to know the hub’s assets and how they fit together. Today, we continue a series on the “Pipeline Crossroads of the World” with a look at the companies that own Cushing storage capacity and how that storage is put to use.

**********************************

Minor Notes

Enbridge: previously announced, from SeekingAlpha --

• Enbridge announces deals to acquire all public equity of sponsored units Enbridge Energy Partners, Enbridge Energy Management, and Enbridge Income Fund Holdings, simplifying its corporate structure and detailing a plan proposed in May
• EEP unitholders will receive 0.335 ENB common shares for each common unit owned, representing an 8.7% increase to the exchange ratio proposed by ENB on May 17
• EEQ shareholders will receive 0.335 ENB common shares for each share owned, which is at parity with the EEP exchange ratio
• EBGUF shareholders will receive 0.735 ENB common shares for each share owned plus C$0.45 cash per share, representing a 9.8% increase to the exchange ratio proposed on May 16, and 11.3% including the cash component
• ENB bought out its Spectra Energy Partners subsidiary in a deal announced in August

Seeing "red." Governor Moonbeam says "green" decals bought before 2017 -- only two years ago -- no good. Need to buy a new car in 2019 if you want a "green" decal. Pretty funny.

Canadian CBR, Slawson, The Dockets, And All That Jazz, Page 2 -- September 3, 2018

Canadian CBR: from SeekingAlpha. Wow, what a memory. I mentioned the other day, from recall, I thought Canadian CBR was 200,000 bopd. From the linked story:

Canadian pipelines: I've held and accumulated ENB over the decades. Long, long story how I got involved. From there, EEP. Probably lost more money than I've made -- or could have made had I invested elsewhere, but that's fine. The other day a reader asked me whether I would recommend EEP (or was it ENB? I forget) as an investment. I said I could not recommend ENB/EEP to anyone who wasn't prepared to lose it all. Line 3.

Recommendations: in fact, speaking of recommendations. I can't recommend investments ideas to anyone. Everyone's circumstances are different.

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here.

Canadian pipelines: back to ENB and EEP. Line 3 is a concern. Regardless how that turns out, I think one can say Enbridge = The Canadian Pipeline Company. Let's digress for a moment. The US desperately needs heavy oil. In fact, when folks talk about a supply "problem" going forward and a rise in prices, they are talking about "heavy oil." And because commodity traders can't keep the two separate, the price of "heavy" oil will drive the price of "light" oil.

US sources for heavy oil:

• Canada, Mexico, Venezuela, Russia, the Mideast. Did I miss any?
• Canada: landlocked; can't close a deal
• Mexico: socialist president-elect will drive Mexico's oil industry into the ground (figuratively)
• Venezuela: no light at the end of that tunnel
• Russia: are you kidding?
• the Mideast: okay

Back to Canada, Enbridge.

Want to see a spectacular map?

Link to Canadian Association of Petroleum Producers. Figure 4.1 from page 19:

Two things jump out at me on the graphic above:

• if Line 3 does not go in, the US consumer is the big loser; Enbridge will do just fine; maybe even better; pipeline rates stay high; again, remember: the US needs "heavy oil" -- with Mexico and Venezuela out of the picture, that pretty much leaves Canada. Mideast heavy oil goes to California and Saudi's refinery o the Gulf coast
• that orange line: Spectra. Now owned by Enbridge; that's why I say Enbridge = the Canadian Pipeline Company (the map is hard to read; I assume I am correct on this; could be wrong)

Spectra?

Spectra Energy Corp, headquartered in Houston, Texas, operated in three key areas of the natural gas industry: transmission and storage, distribution, and gathering and processing. Spectra was formed in late 2006 from the spin-off from Duke Energy. Spectra owned the Texas Eastern Pipeline (TETCo), a major natural gas pipeline which brings gas from the Gulf of Mexico coast in Texas to the New York City area, which was one of the largest pipeline systems in the United States. Spectra also operated three oil pipelines. In February 2017, Spectra Energy merged into the Canadian company Enbridge.

Time for a music video:

Massachusetts, The Bee Gees
Pipelines: in the investing world, pipelines are "moats"

• cost prohibitive to build
• crossing jurisdictional boundaries (state, province, international): a nightmare
• made worse by the North American Anti-Pipeline Coalition (NAAPC)

Don't bring me down: any question why the Traveling Wilbury's were the greatest super-group ever? The harmony in this is incredible. Rosie Vela. Wow, what a career. What a great country. I was particularly happy with Rosie and Jeff's shout-out to me.

Don't Bring Me Down, ELO

The Market, Energy, And Political Page, T+17 -- August 31, 2018

Idle chatter. It appears to be a quiet day, so I will interrupt it with my incessant chatter.

Sector rotation: the Dow (irrelevant) is down 100 points. AAPL, meanwhile, hits a new high, rising another $1.77, trading at $224.76. Pretty impressive. 

NYC: back to normal. Long Island customers will only pay $110/MWh today. Link here.

Natural gas fill rate, link here:

T+17, Iran sanctions. First round went into effect on August 7, 2018; second round set to begin November 4, 2018.

Selfish: for selfish reasons I would like to see Melania, the First Lady, out and about a bit more. She keeps a very, very low profile and I don't blame her. I hope she is enjoying life. I assume she is doing just fine. I really, really would enjoy seeing her out and about. But, having said that, not seeing her is so much better than the alternative, seeing Bill Clinton, First Man, dominating the news, had Hillary been elected. And if it weren't for the 22nd Amendment, we would still be seeing Michelle and her garden. Speaking of which, I assume the garden has now become a putting green.

Oil:

Global warming:

The Hippocratic oath: "first, do no harm."

The market:

Oh, before I begin, the disclaimer -- this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here. I am now posting financial "stuff" because:

• at least one of my siblings appreciates it (I think she's the only family member that actually reads the blog)
• my wife has successfully completed an in-depth financial course and may someday actually read the blog
• in September, I will step down as CEO and chairman of our financial affairs "entity" and hand over CEO responsibilities to my executor; I will remain as chairman; due to non-disclosure agreements, nothing else can be said at this time

Now, back to the market, for my one sister who reads the blog and my executor, not intended for anyone else; whether or not I have holdings in those mentioned, I enjoy following them:

• all major indices: red; profit-taking; background noise
• AAPL; flat; it had a good run; Apple is now a mature company; generally it will trade in a "trading range," and will show volatility leading up to quarterly earnings; growth will be tough; it's a value stock now; hard to call it FANG; lots of cash so dividend increases likely and overall return will be nice but not great; stay with what you have, but don't add to your portfolio; up as much as $4.00 today; apparently Warren Buffett's BRK added another 5% to their overall AAPL holdings;
• ENB: down along with the overall market; Line 3 is the concern here; buying Spectra was huge and could offset problems associated with Line 3;
• SRE: nice; on a down day for the market (albeit not much), SRE is showing some life, up about 0.65%); paying 3%
• D: ditto SRE; I think I read somewhere Dominion Energy is the fastest growing utility in the US; paying almost 5%; wow;
• COP: movers and shakers in the oil sector consistently say good things about COP; up a bit today and paying 1.6% but expectations for dividend increases are often cited
• CVX: flat today, slightly red; paying a remarkable 3.76%;
• XLNX: down slightly today; a real sleeper; paying almost 2%;
• PLUG: what can I say; stay away;
• BRK-B: might as well invest in Schwab Total Stock Market Index Fund (SWTSX) -- easy to remember -- "SW" = Schwab; "TS" = total stock' and "X" = mutual fund; the only difference: no avuncular advice
• UNP: off its recent high; paying 2%; trucking industry with challenges; truckers have "last mile" niche but rails will get the rest;
• Midstream MLPs: not for the faint-hearted; I love the two I have; would have preferred a third, but more trouble than they are worth? Some analysts suggest MLPs have seen their worst days after FERC changed the rules; 
• OAS: actually "green" today; 
• NOG: flat 
• S: up a bit today; may still have legs before merger?
• BABA: volatile; long-term? No dividend
• YUM: hold, but don't add. Pays $1.7%; watch for another year, then decide
• AMZN: share price hit $2,000 but still hasn't hit market cap of $1 trillion, and pays no dividend
• SLB: up a bit today; pays 3%; time to move on;
• TSLA: oh, TSLA, almost forgot; how could I forget, $302, well off it's high of $389 and well short of the one analyst's target: $4,000 
• ETP and ETE: SeekingAlpha. 

Week 34: August 19, 2018 -- August 25, 2018

This is a shorter list than usual because I posted the "top stories" later than usual last week.

Having said that, the top stories are quite interesting.

What don't you want: Bakken holds on to top spot among IRRs

From others

• Geoff Simon's top North Dakota energy stories this week. 
• be sure to see the links inside that post; some great presentations
• Williston's economic development weekly report.
• Mike Filloon's update on the Bakken.
• Enercom: annual presentations.

Operations
Whiting bucks trend: thinks different; works smart 
CLR: using max amounts of proppant
Enerplus has an "Aussie animal" pad
Busy: eight new permits; fourteen permits renewed; five producing wells reported as completed;

Proppant
Whiting bucks trend; using "less" proppant

Economy
Legacy Fund deposits drop for the month of August, 2018

Miscellaneous
Enbridge to buy Spectra Energy Partners 

Enbridge To Buy Spectra Energy Partners -- August 24, 2018

This seems like "old news" or "predictable news."

Click here for previous posts that mentioned "Spectra Energy."

Today's "news", from MarketWatch, Enbridge to buy Spectra Energy Partners in a $3.3 billion stock deal.

Enbridge Inc. ENB, said today it will buy the pipeline master limited partnership Spectra Energy Partners LB SEP, in a stock deal valued at $3.3 billion.

Under terms of the deal, Enbridge will exchange 1.111 of its common shares for each Spectra share.

Based on Thursday's stock closing prices, that values Spectra shares at $40.00 each, or a 5.6% premium. The deal is expected to close in the fourth quarter of 2018.

Flashback, back to 2010: See this note from July 19, 2010, comparing Spectra and MDU:

Spectra Buys More Storage 

Now, today same song, different verse: Spectra Energy will buy Bobcat Gas Storage from two partners, including GE Energy Financial Services, for $540 million. In addition to the purchase price, Spectra will invest another $400 - $450 million to fully develop the facility by the end of 2015. The facility with 46 bcf of gas storage capacity is located in southeastern Louisiana.

This will bring Spectra's total storage capacity to about 340 bcf.

Spectra vs MDU

MDU's total storage capacity is about 353 bcf. (I do not know if this includes the expansion of the Baker storage facility. I assume it does.)

My understanding is that Spectra is a pure-play natural gas production and distribution company, compared to MDU in which natural gas production and distribution is but one division.

The market cap for Spectra is: $14 billion
The market cap for MDU is: $3.6 billion (that was in 2010; today -- 2018 -- MDU's market cap is $5.8 billion).

Another Inconvenient Truth -- The Myth Of An Imminent Energy Transition -- Peter Tertzakian -- May 18, 2018

Preaching to the choir, but "fun" to read. Over at oilprice.com:

100 million. It’s a number that drowns comprehension; it’s more jelly beans than can fit in an average-sized swimming pool.

Within a year, world oil consumption will top 100 million barrels of oil per day. Over the same time period, close to 100 million new piston-firing vehicles will be bought by petroleum-thirsty customers.

I hate to say it, but any notion of imminent “energy transition” or “decarbonization” is folly.

In fact, the percentage of fossil fuels in the world’s energy mix—coal, oil and natural gas—is still lingering well above 80 percent, a figure that has changed little in 30 years. That remains so, despite being challenged by serious environmental policies, financial pressures, viable alternative systems, public awareness and social activism.

It’s true that wind and solar are being deployed quickly, at an exponential rate in fact. But impressive as it all is, renewable energy installations are far too slow to catch the still-hardy appetite for fossil fuel consumption. Such energy obesity is not virtuous, but it’s a fact needing acknowledgement in a world of over seven billion people, each of whom are wanting for more light, heat, mobility and a panoply of mostly useless gadgetry.

And he goes on and on. "Fun" to read.

100 million bbls/day.

Libya? What? 500,000? 1 million? 2 million? Not what. Whatever.

************************************

Gasoline Demand

Link here.

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Odds And Ends -- But Mostly Odd

Williams: $10.5 billion; buys all public equity of its subsidiary.  From AP.


Enbridge: $9 billion re-structuring, consolidation deal. Just getting started. From Reuters.

Pipeline operator Enbridge Inc said on Thursday it would bring its independent units and liquids and gas pipeline assets under a single listed entity as part of a move to streamline its corporate structure.

Enbridge said it would buy in outstanding shares of its various corporate units, including Spectra Energy Partners and Enbridge Energy Partners, for a value of C$11.4 billion ($8.94 billion), or 272 million of its common shares.

The company, which has been trying to recast itself as a pure pipeline utility, has been under pressure to sell non-core assets and pare its debt pile of $60.87 billion as of December 31, 2017.

And after July 1, 2018, it's gonna get worse. Mexico's landmark energy reforms are mired in regulatory delays. From Reuters.  Link to the graphic below here.

 

Disclaimer: this is not an investment site. Do not make any investment, financial, job,travel, or relationship decisions based on what you read here or think you may have read here.

Update On Enbridge -- Mike Fitzsimmons -- May 11, 2018

Link here over at SeekingAlpha.

Summary

• Back in March, with its NYSE shares trading at $33.50, I suggested that ENB was 40% undervalued.
• Shares probed under $30 in April, looking for a bottom. I think that got management's attention.
• As expected, due to natural gas seasonality and a full quarter of Spectra contributions, the Q1 EPS yoy comparison was a breeze.
• But the recent strength in the stock is due more to announced and potential asset sales to address the market's big concern: Debt.

As I suggested in my March article on Enbridge, Q1 year-over-year comparisons would be easy considering it would be the first full Q1 worth of Spectra contributions, as well as a seasonally strong quarter for the natural gas businesses.

That said, I was pleasantly surprised with the Liquids Pipelines Mainline System Segment - which delivered its highest ever quarterly volume. But it was the announcement of ~$3 billion in asset sales, as well as reported strong bidding for additional midstream assets, that put a bid in the languishing stock. It is clear investors want management to regain investor confidence by selling non-core assets and addressing the big concern: The debt load needed to fund the Spectra merger.

The Q1 EPS report was generally bullish with adjusted EPS of $0.82 exceeding average analyst expectations by $0.18/share. As shown in the graphic below, while yoy EBITDA and net earnings were lower, cash from operations ("CFO") was up 80%, while distributable cash flow ("DCF") was up a whopping 90%.

Management has certainly gotten the message with respect to investor concern over the high debt level and the significant interest expense. And it should have - the ~25% sell-off in the shares after the Spectra merger left some to wash off egg on their faces.

However, it would appear the low is in, the 6.3% yield is safe and secure, and the prospect of further asset sale announcement this year could propel ENB closer to the $40 level than the $30 level it has been hovering around for most of this year.

ENB is a buy for income-oriented investors who also want to take a flyer on additional asset sale announcements that could easily add another $4-5/share in capital appreciation.

Disclaimer: this is not an investment site. Do not make any investment or financial decisions based on what you read here or what you think you may have read here.

The Market And Energy Page, T+15 --- March 15, 2018; How Did Bloomberg's Gadfly Miss This One?

Disclaimer: 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.

Wow. EOG has 40% upside -- Fitzsimmons over at SeekingAlpha.

• like many Canadian energy stocks these days - Enbridge has suffered a massive sell-off: down 14% YTD and down 20% since the merger with Spectra was completed
• but ENB's liquids pipelines in Canada are running at full capacity. And its storage assets benefit from the back-up in Canadian supply
• dividend growth prospects are excellent and management has committed to growing the dividend at a 10% CAGR through 2020
• an analysis of EV/EBITDA at a 14x midstream multiple (using 2018 estimated EBITDA) indicate shares are deeply discounted
• the shares could easily trade up 40%, or to $46, from the current $33. Add in the current 6.3% dividend and the total return would be 45%+ 
• the dividend story is incredible
• mentions Line-3 in passing; a big concern 

Texas holdem: cold snap could trigger gas supply emergency in UK if Putin orders Russian gas giants turn off taps due to spy scandal (won't happen; ships already in port, or very close)

• the cards:
• Putin's hole cards: two aces
• Theresa May's hole cards: an ace and an 8
• the flop: an ace, another 8
• the turn: yet to come
• the river: yet to come
• we've been talking about this since the winter of 2013-2014, maybe 2011-2012
• now we have the winter of 2017-2018
• Putin's in control, but a full house beats three of a kind

Beating a dead horse named Ipo. Now Bloomberg --

A couple of years on, the IPO hasn't yet happened, and there are now signs it could be pushed into 2019. The figure looks like it resulted from a highly scientific process of multiplying Saudi Arabia's roughly quarter-trillion barrels of proved oil reserves by a multiple of $8. But the fact that Aramco is being privatized in the first place undercuts such simple valuation by reserves, because the IPO acts as a hedge against weaker long-term oil demand. It makes little sense to apply such blanket valuations against 60 years' worth of production (companies usually carry about 10 - 15 years of proved reserves on the books).

Rule number one with an IPO: Don't announce a target value years ahead of the actual sale -- especially if one is tempted to use the word "trillion."

That rule was broken way back with Saudi Arabian Oil Co., or Saudi Aramco. In early 2016, when Prince Mohammed bin Salman first unveiled plans to list shares in the oil behemoth, he boasted about a price tag of $2 trillion. A couple of years on, the IPO hasn't yet happened, and there are now signs it could be pushed into 2019.

The problem: cash flow. Saudi Arabia can't get there from here.

Cash flow:

How Saudi gets there (hint: it won't, unless there's a huge geopolitical event):

One big problem: when it comes to some offerings, cash flow does not matter at all. It's all about the mojo. If cash flow mattered, Tesla would have gone away a long, long time ago.

How could Bloomberg's gadfly miss that?

"Everyone" will want a piece of the Saudi Aramco pie. Or not. But cash flow is not the driver.

Other comments:

• look at that: to get to Shell's 7% cash flow at $65, the Saudi Arabia IPO is worth about half ($1.1 trillion) vs what Prince Salman wants ($2 trillion)
• another trope dashed: Saudi's net profit per bbl on $65 oil is ... drum roll ... $18/bbl

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If I Had My Druthers ...

... I wouldn't post links to oilprice.com, but sometimes it's almost impossible not to link some articles. We've talked about this for quite some time. This is why I suggested the other day that the biggest oil story of the year might be ExxonMobil's decision to move to light oil at its Gulf Coast refineries. RBN Energy has talked about this more than once. From oilprice.com:

"2020 is going to usher in a mammoth sea change for the global petroleum market. On January 1, 2020, the International Maritime Organization - the agency that regulates the global shipping market - will enforce a global sulfur cap of 0.5 percent on marine fuels.

While this is this going to have the biggest impact on fuel oil and middle distillates, it is also going to influence the crude flows of heavy sweet barrels. In fact, it already is.

Heavy sweet crude is going to be increasingly in demand in 2020, as refiners look to pivot towards producing low sulfur fuel oil.

Lest we forget, lighter crude yields less fuel oil, while sour crude raises the sulfur content.

The challenge for the global market is going to be getting its hands on heavy sweet crude. According to our ClipperData, heavy sweet crude exports make up just over 1 percent (!) of total waterborne exports, and have been on the wane in recent years. Of these exports, nearly two-thirds come from West Africa.

Paragraph 6: Angolan Dalia is the leading grade, but there are also exports of Lokele from Cameroon, Baobab from the Ivory Coast, Yombo from Congo and Ebok from Nigeria. Doba, which is produced in landlocked Chad, is the second-largest export, and hits the global market via loadings from Cameroon.

In terms of the destination of these grades, three countries account for a half of all barrels: the U.S., India and China. An interesting trend is emerging, as illustrated in the chart below. China has surpassed the U.S. in just the last year to become the largest recipient.

For newbies: there are two huge things I've learned from the blog over the years regarding heavy oil vs light oil

• US refiners along the Gulf Coast optimized their operations for heavy oil at great cost about ten years ago; killing the Keystone XL changed everything
• heavy oil: distillates, like fuel oil; light oil: gasoline (see graphic)

The coolest thing about the story above: while reading paragraph six (6) above, a 2 x 4 hit me on the head, and a light bulb went off: quick -- name the one country in the world that is investing heavily in African heavy oil.

Yup: China.

As I said to my son-in-law last night, things are moving very, very fast. My only regret: I won't live long enough to see many of these "sea-changes" -- pun intended.

Random Note On Enbridge -- January 13, 2017

I've always been fascinated by Enbridge. I first became aware of Enbridge during the early days of the Bakken boom. Enbridge had a relatively small operation south of Williston but it was impressive, and it seemed to be among the first big players in the Bakken. Since then, that operation (as "measured" by the footprint) has steadily grown. So, it's been interesting to watch Enbridge in the Bakken. 

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on anything you read here or think you may have read here. With regard to Enbridge, I've owned a small amount of shares over the years but have no plans to buy any more shares in Enbridge. 

From Motley Fool, from a couple of days ago:

Last fall, Canadian pipeline giant Enbridge announced that it would increase its dividend 10% for 2018. That pushes the company's dividend-growth streak to an impressive 23 years, which is just two shy of the years necessary to become a Dividend Aristocrat.

Enbridge fully expects to lay claim to that title in 2020 since it also plans to increase its payout 10% in 2019 and 2020. Those future increases will push Enbridge's already impressive 4.7%-yielding dividend even higher.

Fueling Enbridge's fast-growing dividend are 22 billion Canadian dollars ($17.5 billion) of high-return expansion projects currently underway. The company expects recently completed expansions and those coming on line this year to increase its available cash flow from operations by about 15% in 2018.

That puts the pipeline giant on pace to grow cash flow by at least a 10% compound annual rate per share through 2020, providing it with the fuel to keep raising the dividend.

From an earlier post, December 27, 2017:

Enbridge: growth portfolio is underappreciated -- Morningstar.

Enbridge is positioned to benefit from growing oil sands supply dynamics with its Mainline system and regional oil sands pipelines. The regulated Mainline system generates attractive tolls and represents approximately 70% of Canada’s pipeline takeaway capacity. The system offers refinery access to various markets, adding to the network’s attractiveness.

While crude pipelines are Enbridge’s bread and butter, the company operates a diverse energy portfolio. Gas distribution operations benefit from regulated returns and provide the company with reliable cash flows. Enbridge also operates natural gas pipelines and processing assets that supplement its crude pipeline network. Future natural gas pipeline projects benefit from long-term contracts that are tied into emerging projects.

Recently, Enbridge finalized its acquisition of Spectra Energy. The deal positions Enbridge to diversify its operations toward natural gas. The company intends to increase its annual dividend and has maintained an average distributable cash coverage ratio of approximately 3 times over the past three years.

Overall, Enbridge is in a strong position to benefit from the growing oil sands supply, which we expect to outstrip pipeline takeaway capacity in the near term. We expect the Line 3 Replacement to help; we project it to be in service by the end of 2019 and fuel tremendous growth for the company. We believe the stock is undervalued based on the company’s vast growth portfolio, highlighted by the lucrative natural gas projects associated with the Spectra acquisition and the Line 3 Replacement.

Enbridge Energy Partners: 10% dividend just got safer -- Motley Fool.

Not only that, but management expects the payout to grow at around 3% per year through 2020. Investors were rightly shocked by the news, sending shares up by as much as 10%. Enbridge Energy Partners and its parent, Enbridge, Inc. (NYSE: ENB), have made multiple moves in recent years that would leave anyone's head spinning. But the ship seems to have been righted, and the stock's sky-high yield appears safe for the foreseeable future in light of the outlook's key details. In fact, for venturesome investors, EEP is a great high-yield stock to consider heading into the new year. 

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on anything you read here or think you may have read here.

Morning In America? December 27, 2017

First things first, football: today is the day that college football playoffs and bowl games reach their stride with three to four bowl games / day. Today there are four games. Whoo-hoo. I may go over to Applebee's and simply hang out. LOL I  hate the names of the bowl games, but some of the match ups should be pretty good:

• Southern Miss vs Florida State, must watch, 12:30 p.m. CT
• Iowa vs Boston College, must watch 4:15 p.m. CT
• Purdue vs Arizona, no interest, but someone must want it, prime time, 7:30 p.m. CT
• Missouri vs Texas, no interest, but someone must want it, prime time, 8:30 p.m. CT

So, Applebee's this afternoon; couch potato this evening. What a great country!

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ISO New England 

After posting, a reader made these observations:

The NE power situation this moment ...
Couple of observations ...
The nuke, coal and GAS fuel percentage has been 'flatlined' all day, potentially indicating the fuel/facilities are maxxed out.
Oil is currently providing 19% of the juice - approaching gas' contribution
Forecast calls for next ten days remaining below freezing (32) all day and night.
Those folks are not only facing catastrophic costs just as winter begins, I'm wondering how secure/reliable their oil supplies are if they are burning through it a such a high rate.

There is a fairly large oil burning plant in Maine that was one of the most vociferous critics to gas pipeline build out.
Easy, in these circumstances, to see why. 

Looks like it's time to turn on the wind and solar farms. Link here.

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The Market

Tesla: And more trouble for Tesla, at least that’s what analysts at KeyBanc are predicting. After conversations with Tesla salespeople across the the country, analysts believe the electric car maker will report 70% fewer Model 3 deliveries for the current quarter than previously expected. Elon Musk said he would deliver 15,000 Model 3 vehicles in December, 2017. Early this morning, CNBC talking head said the number was more likely to be 5,000. Thirty percent of 15,000 is 4,500. Thirty percent of 5,000 is 1,500. If it's 5,000 vehicles, the believers will still believe. If it is less than 2,000 ... watch out....

Bull market: earlier this mornig a talking head on CNBC reminded us that the secular bull market that began in 1949 lasted until 1966. The "great recession" ended in 2012. 2029 is seventeen years from now.

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Where E-Media Shines

The Wall Street Journal has an excellent article on the defeat of ISIS. The dynamic maps are incredible and really bring the story to life. If caught behind a paywall try googling how islamic state's caliphate crumbled wsj. See also this post.

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Energy

Later today: the calendar suggests that API will release its weekly US crude oil inventories later today, but unlike previous weeks, no forecast is provided. Update: the forecast was for a drawdown of 3.8 million bbls; in fact, API shows actual drawdown of 6 million bbls. I use EIA data to follow re-balancing. EIA data should be released tomorrow, unless holiday Monday delays EIA data for one day.

Putting miners back to work: not only will the Trump EPA "repeal" the Clean Power Plan but it looks like Rick Perry, not the sharpest knife in the drawer, has found a way to subsidize coal. LOL.

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Shell Game

Shell confusion. I'm hearing conflicting stories on how the new tax bill will affect Royal Dutch Shell. For the past 36 hours -- including minutes ago (8:03 a.m. CT) on CNBC that RDS will incur a $3 billion charge in the fourth quarter. But now this "breaking story," at 5:33 a.m ET, from thefly.com:

Royal Dutch Shell expects U.S. tax reform to be favorable to Shell.

Royal Dutch Shell plc expects the potential economic impact of the recently enacted U.S. tax reform legislation to be favorable to Shell and to its U.S. operations, primarily due to the future reduction in the U.S. corporate income tax rate from 35% to 21%.

This change in U.S. tax legislation, effective January 1, 2018, will impact Shell's Q4 results but the analysis of the actual impact is not yet complete.

Shell intends to determine and announce the actual impact including any Q4 movements, and balance sheet adjustments, as part of its Q4 results.

However, on the basis of the Q3 financial statements, Shell would have incurred an estimated charge to earnings of $2B-$2.5B primarily driven by a re-measurement of its deferred tax position to reflect the lower corporate income tax rate. This charge represents a non-cash adjustment and will be reflected as an identified item.

How will the average investor know where the truth lies? Follow the share price of RDS-A or RDS-B. By the way, in 2019, the difference between RDS-A and RDS-B will no longer exist, which begs the question: do the "B" shares go away?

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For Those Who Love The Smell Of Diesel 

Diesel? Yup, diesel is the new green!

Welcome to a clean green Australia where they gave up coal to move to diesel. Fear of blackouts means diesel generator sales up 400%. Over at JoanneNova.

You can "believe" that story or you can go with Elon Musk: Tesla's enormous battery in Australia, just weeks old, is already responding to outages in "record" time, from The Washington Post. 

Less than a month after Tesla unveiled a new backup power system in South Australia, the world's largest lithium-ion battery is already being put to the test. And it appears to be far exceeding expectations: In the past three weeks alone, the Hornsdale Power Reserve has smoothed out at least two major energy outages, responding even more quickly than the coal-fired backups that were supposed to provide emergency power. Tesla's battery last week kicked in just 0.14 seconds after one of Australia's biggest plants, the Loy Yang facility in the neighboring state of Victoria, suffered a sudden, unexplained drop in output.

But this is the real story:

Fed by wind turbines at the nearby Hornsdale wind farm, the battery stores excess energy that is produced when the demand for electricity isn't peaking. It can power up to 30,000 homes, though only for short periods — meaning that the battery must still be supported by traditional power plants in the event of a long outage. 

Astute readers will know why Australia needed batteries in the first place and why their spot electricity prices are surging.

*************************************

Back to the Bakken

Active rigs:

$59.44→	12/27/2017	12/27/2016	12/27/2015	12/27/2014	12/27/2013
Active Rigs	53	41	62	173	187

RBN Energy: Alberta gas production tests takeaway capacity.

Western Canadian natural gas producers are increasingly facing oversupply conditions and price volatility. While competition and pushback from growing U.S. shale gas supply continues to be a factor, producers are now also contending with fresh problems closer to home — namely transportation constraints right where production is growing the most, in central Alberta.

This fall, the Alberta market experienced extreme bottlenecks that left production stranded and sent area gas prices reeling. The ramp-up of winter heating demand has since helped ease the constraints, but the problems are likely to return in the spring when demand is lower, leaving producers exposed to the risk of severe price weakness again in 2018 and limited in their ability to grow supply. Today, we continue our look at what’s behind the local constraints and the implications for production growth and prices in Western Canada.

Enbridge: growth portfolio is underappreciated -- Morningstar.

Enbridge is positioned to benefit from growing oil sands supply dynamics with its Mainline system and regional oil sands pipelines. The regulated Mainline system generates attractive tolls and represents approximately 70% of Canada’s pipeline takeaway capacity. The system offers refinery access to various markets, adding to the network’s attractiveness.

While crude pipelines are Enbridge’s bread and butter, the company operates a diverse energy portfolio. Gas distribution operations benefit from regulated returns and provide the company with reliable cash flows. Enbridge also operates natural gas pipelines and processing assets that supplement its crude pipeline network. Future natural gas pipeline projects benefit from long-term contracts that are tied into emerging projects.

Recently, Enbridge finalized its acquisition of Spectra Energy. The deal positions Enbridge to diversify its operations toward natural gas. The company intends to increase its annual dividend and has maintained an average distributable cash coverage ratio of approximately 3 times over the past three years.

Overall, Enbridge is in a strong position to benefit from the growing oil sands supply, which we expect to outstrip pipeline takeaway capacity in the near term. We expect the Line 3 Replacement to help; we project it to be in service by the end of 2019 and fuel tremendous growth for the company. We believe the stock is undervalued based on the company’s vast growth portfolio, highlighted by the lucrative natural gas projects associated with the Spectra acquisition and the Line 3 Replacement.

Enbridge Energy Partners: 10% dividend just got safer -- Motley Fool.

Not only that, but management expects the payout to grow at around 3% per year through 2020. Investors were rightly shocked by the news, sending shares up by as much as 10%. Enbridge Energy Partners and its parent, Enbridge, Inc. (NYSE: ENB), have made multiple moves in recent years that would leave anyone's head spinning. But the ship seems to have been righted, and the stock's sky-high yield appears safe for the foreseeable future in light of the outlook's key details. In fact, for venturesome investors, EEP is a great high-yield stock to consider heading into the new year. 

COP: did COP's earning growth outperform the industry? -- Simply Wall St.

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on anything you read here or think you may have read here.

GDP Now -- Trending Back Toward 2% -- And I Recall Pundits Suggesting Hurricanes Would Have No Impact -- The Market And Energy Page, T+241 -- September 18, 2017

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here.
 
Chips: CNBC is excited about semiconductors. It looks like XLNX hit a 52-week high but did not close above that intra-day high.

Markets: Dow 30 and S&P 500 set new records on opening and are holding their gains through morning trading. NYSE:

• new highs: 141, including Boeing, CAT, Valero Energy,
• new lows: 8

Gasoline demand: was record gasoline demand reported last week an anomaly? See this post.

GPD Now: latest forecast: 2.2 percent — September 15, 2017.

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2017 is 2.2 percent on September 15, down from 3.0 percent on September 8.

The forecasts of real consumer spending growth and real private fixed investment growth fell from 2.7 percent and 2.6 percent, respectively, to 2.0 percent and 1.4 percent, respectively, after this morning's retail sales release from the U.S. Census Bureau and this morning's report on industrial production and capacity utilization.

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A Note To The Granddaughters

We joke that our oldest granddaughter knows something about everything.

Last week, out of the blue, I happened to ask her if she had heard of the expression, a "10-gallon hat." It turns out she had and she explained it to me.

Now, why would I bring that up this morning?

Today, driving to school, we saw a bumper stick, "Never never."

The middle granddaughter was upset that this was a "double negative" and went on and on about not using double negatives. Of course, it is not a double negative in this context. After several minutes of listening to this craziness, the oldest granddaughter just rolled her eyes and quoted Justin Bieber (I am not making this up):

There's gonna be times when people tell you that you can't live your dreams, this is what I tell them, Never Say Never. -- Justin Bieber from a-to-z quotes.

For the record, the  “Never say never” expression was first recorded in Charles Dickens's Pickwick Papers (1837).

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Searching For The Oldest Stars:

Ancient Relics From the Early Universe

Anna Frebel

c. 2015

Princeton Press

DDS 523.8FRE

 
For now, just some quick data points. Maybe I'll expand this later so it make sense.

• at the turn of the century (1890s)
• Edward Charles Pickering, Harvard College Observatory
• Henrietta Leavitt begins work as one of several female research assistants, 1893
• the assistants became known as "computers"
• predecessors included Williamina Fleming and Antonia Maury
• extended Secchi's classification of stars
• Pickering was so frustrated with his male research assistants said even his housekeeper could do better
• he hired her -- Williamina Fleming -- who completed every single assignment she was given
• Leavitt: confirmed period-luminosity relationship, 1912; Magellanic Clouds
• at the time, it was not yet known whether the Universe was any larger than the Milky Way itself
• Edwin Hubble, Mount Wilson, southern California, sorted that out
• Leavitt died of cancer in 1921 at 53 years of age; had she not died she would have been nominated for a Nobel Prize (1924)
• another computer: American astronomer Annie Jump Cannon started working for Pickering in 1896
• her task: catalog an extensive compilation of stellar spectra, called the Draper Catalogue, and develop a classification system
• Cannon was the first to sort spectra by stellar temperature after realizing that a dependence existed between temperature and spectral line strength
• her new system later became famous as the Harvard classification scheme
• O, B, A, F, G, K, and M: "Oh Be A Fine Girl / Guy, Kiss Me"
• O-type stars are the hottest
• M-type stars are the coolest
• Cannon became known for her classification of over 200,000 stars
• numerous awards
• honorary doctorate from Oxford University in 1925 -- first ever woman to be conferred with that title
• 1931: US National Academy of Sciences awarded her the prestigious Henry Draper Medal
• Harvard, in 1938, appointed her, at the age of 75, to the academic postof William Cranch Bond Astronomer, with the same "rank" as a professor
• Cannon published her huge catalog with updated editions from 1901 t0 1937
• her work has continued, even after her death in 1941
• The American Astronomical Society had introduced the Annie J. Cannon Award back in 1934; Antonia Maury received it in 1943

The Energy And Market Page, T+231 -- September 8, 2017

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here.

MLPs with safe (?) yields greater than 5.5% -- from Barron's:

Here's the list of six MLPs with sustainable yields above 5.5%:

• Enterprise Products Partners (EPD) at 6.4% 
• Oneok (OKE) at 5.5%, 
• Williams Partners (WPZ) at 6.1% 
• Enbridge Energy Partners (EEP) at 9.1% 
• Spectra Energy Partners (SEP) at 6.4% 
• MPLX (MPLX) at 6.6%. 

The yield on the Alerian ETF (AMLP) is 7.9% and CreditSights' MLP coverage has payouts ranging from 3%-12%.

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Notes to the Granddaughters
 
Splat Ball and Poincare's Conjecture

Book Of Mathematics
The New York Times 
edited by Gina Kolata
c. 2013
DDS: 510NEW 

Last night I was watching Sophia, the 3-year-old, playing with a splat ball that her oldest sister had given her. One throws these splat balls hard unto the floor, deforming them beyond recognition, and they return to their original shape, generally a sphere (and technically always a sphere based on Poincaré's conjecture).

I happened across that oddity (?) while reading The New York Times' collection of math-related essays it had published over the past 100 year. On page 119, an elusive proof and its elusive prover (sic).

It turns out that Grigori Perelman solved the century-old Poincaré conjecture and then retreated back into the Russian woods, turning down both a $1-million reward and the Fields Medal (the mathematics equivalent to the Nobel Prize). Also left hanging, is another $1 million offered by the Clay Mathematics Institute in Cambridge, MA, for the first published proof of the conjecture, one of seven outstanding questions for which they offered a ransom back at the beginning of the millenium.

Poincaré''s conjecture can sound either daunting or deceptively simple:

It asserts that if any loop in a certain kind of three-dimensional space can be shrunk to a point without ripping or tearing either the loop or the space, the space is equivalent to a sphere.

From the article:

The conjecture is fundamental to topology, the branch of math that deals with shapes, sometimes described as geometry without the details. To a topologist, a sphere, a cigar, and a rabbit's head are all the same because they can be deformed into one another. Likewise, a coffee mug and a doughnut are also the same because each has one hole, but they are not equivalent to a sphere.

In effect, what Poincare suggested was that anything without holes has to be a sphere.

In the video below, a youngster throws a splat ball on the floor and it turns into any number of deformed, unrecognizable, indescribable shapes, but in the end ... every one of those deformed, unrecognizable, indescribable shapes turns out to be a sphere. 

It's a long, ridiculous video ... skip ahead to 1:10 or 1:50 in the video to see what I mean.

The Market And Energy Page, T+220 -- August 28, 2017

Not surprising: FERC approves "controversial" pipeline.  Data points:

• NEXUS Gas Transmission pipeline; held up by activists across Ohio
• $2 billion
• capacity: 1.5 billion cf/d from the Utica/Marcellsu
• will carry natural gas into Michigan and Ontario, Canada
• joint venture between Detroit-based DTE Energy and Spectra Energy
• Spectra Energy: merged with Enbridge earlier this year
• lead lawyer of the CAVE dwellers said "it is bad news. It is utterly expected. But the fight is not over." Of course not, for CAVE dwellers, it never is. 
• previous posts on the Nexus pipeline
• CAVE dwellers, December 17, 2016
• general story, March 13, 2016
• Richard Zeits, March 12, 2013 -- should have been in service by end of 2016 
• RBN Energy, February 13, 2013

Surprising: coal! From The Wall Street Journal -- the big name in coal’s resurgence: China. American coal producers filling voids created by overseas producers shifting exports to China. China is going to need a lot of coal to power all those coal-powered cars, pretty much being mandated by China. 

Surprising: despite huge economic disaster in Houston --

• WTI: flat to negative
• gasoline: up a percent? depends on whom you believe; where you live
• Dow futures: up nicely 

Surprising: how fast the Amazon-Whole Foods merger was completed. Even my wife who does not follow "this stuff" was surprised to see how fast this happened. It's her experience that such a merger would take months if not a year to be completed; this time, in three months. Reminder: FTC has five seats; only two are occupied right now. I seem to remember reading that somewhere.

Fastest merger ever? What now?

Credit cards: speaking of Amazon, Jeff Bezos, who plans on booking trips to Mars, did not buy Whole Foods to get into the grocery business. It's all about credit cards. Grocery chains are generally not "national." Credit cards are. Quick, name the top publicly traded US grocery chains. Now, name the credit cards: Discover, M/C, Visa, Chase. That's the top tier. Amazon Prime (Chase) is the one to watch. It's all about credit cards. And yes, to some extent, mini-distribution centers and logistics. 

Disclaimer: this is not an investment site. Yada, yada, yada.

Share price: on Friday, Amazon closed down less than 1% (about 0.75%); today, in pre-market trading, Amazon is flat to up slightly, trading at $946.50. Mid-morning, up about one-half percent, to $949.73.

BRK: according to Jim Cramer, insureres and re-insurers are the biggest beneficiaries of Hurricane Harvey (excepting perhaps refiners, home building suppliers, etc). Berkshire is the nation's biggest re-insurer. Pre-market; up slightly, but at the opening, absolutely flat. Down one cent at $179.59.

Pembina Pipeline To Buy Veresen Inc -- North Dakota Story -- May 1, 2017

If one does a "Pembina Pipeline" search on the blog, one finds many, many posts mentioning Pembina Pipeline. It is a big player in the Bakken.

Let's begin with this post, though, from November 8, 2013: the ten fastest growing energy companies in North America:

• Pacific Rubiales Energy Corp - Canada
• Pembina Pipeline Corp - Canada
• HollyFrontier Corp - Texas
• CLR - Oklahoma
• Concho Resources - Texas
• Energy Transfer Equity, LP - Texas
• EOG Resources, Inc - Texas
• Denbury Resources Inc - Texas
• Crescent Point Energy Corp - Canada
• Buckeye Partners, LP - Texas

Pembina Pipeline is a huge transporter of ethane from the Bakken, specifically from Tioga, to western Canadian oil sands where it is used as a diluent to transport heavy oil sands crude oil. Doing a blog search for Pembina Pipeline will provide quite a bit of information.

I say all that because a reader sent me this link: Pembina Pipeline is buying smaller rival Veresen Inc for almost $10 billion, including debt, giving Pembina access to natural gas pipelines and processing infrastructure. The combined company will have a strong position in the Western Canadian Sedimentary Basin, home to the world’s third largest crude reserves.

This deal follows two other recent huge deals in the pipeline sector:

• Enbridge buys Spectra, previously blogged, for almost $30 billion
• TransCanada buys Columbia Pipeline Group, for about $10 billion

Veresen's network stretches across Alberta, British Columbia, Saskatchewan, and North Dakota. In addition, Veresen has a 680-mile natural gas pipeline extending from Wyoming to Oregon, and owns the Albert Ethane Gathering System.

There are several story lines here.

Much more at the link.

It is interesting that Enbridge did not make the top-10 list in 2013.

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Word For The Day: Tsundoku

The Japanese have a word for one who collects too many books: 

The desire to buy more books than you can physically read in one human lifetime is actually so universal, there’s a specific word for it: tsundoku. Defined as the stockpiling of books that will never be consumed, the term is a Japanese portmanteau of sorts, combining the words “tsunde” (meaning “to stack things”), “oku” (meaning “to leave for a while”) and “doku” (meaning “to read”).

One wonders if "tsunami" and "tsundou" have the same root word, or similar etymology. I know that being crushed under my bookcases, should they fall, would be similar to being crushed by a tsunami.