The Dog That Didn't Bark -- June 3, 2016; A Dumpster Fire Any Way You Look At It -- CNBC

Updates

June 4, 2016: CNBC calls it a "crummy" report and goes even farther:

Friday's May jobs report was a dumpster fire any way you look at it. And it cannot have made Hillary Clinton 's Brooklyn, New York, campaign staff very happy.

June 4, 2016: the May jobs report in 12 graphs. 

June 4, 2016: the WSJ has an op-ed on the reason for the stunning, shocking (their words, not mine) jobs report. It has to do with Dodd-Frank, state licensing, and regulatory environment -- but all of that has been in place for years and in some cases, decades. The op-ed does nothing to explain the complete collapse of the job market. Again, no mention of ObamaCare.
 

Original Post

 

This is interesting. I haven't seen anyone else report on it.

What is the most incredulous news story report today?

No one took credit for the unemployment rating dropping from 5.0% to 4.7%. Not only that, no one even discussed it. If anyone discussed the jobs report today, they were using words like "stunning" and "shocking" to describe the stunningly, shockingly low number of jobs created last month (and then blaming the lousy report on Verizon union members. LOL.).

But they weren't discussing the stunningly, shockingly drop in the unemployment rate. In times of economic uncertainty, a flat, or unchanging unemployment rate is good news. A rise of 0.1% is hardly noteworthy. A drop of 0.1% is huge. It demands a huge headline. It's the news story of the day.

Today, the unemployment rate drops a stunning, shocking 0.3% -- from 5% to 4.7% -- and not a single peep from the Obama administration. There's no indication the Labor Secretary even mentioned that at 4.7% unemployment, most economists would consider the US at "full employment." In fact, 4.7% is quite remarkable.

Strange, isn't it?

We'll get back to it later. But for now, I'm headed to bed.

Everybody Knows, Leonard Cohen

Three (3) New Permits -- June 3, 2016

Active rigs:

	6/3/2016	06/03/2015	06/03/2014	06/03/2013	06/03/2012
Active Rigs	25	81	190	189	215

Three (3) new permits --

• Operator: Crescent Point Energy
• Field: Ellisville (Williams)
• Comments: all on the same pad; these wells are spaced 25 feet from each other (all three are 286 feet from the south line of section 7-158-99; one Lowe is 1,424 feet from the east line; Amelia Grace is 1,449 feet from the east line; and, the second Lowe well will be 1,474 feet from the east line

Five permit renewals:

• CLR (4), two Olympia permits, two Charleston permits; all in Williams County
• XTO, a Janice permit in Williams County

Cornerstone canceled one permit, a Huff permit in Burke County

Operator Transfer, from Oasis to Samson Oil & Gas:

• about 74 wells
• counties: Williams, McKenzie, Divide (the vast majority appear to be in McKenzie County; only one in Divide County; about 13 Williams County wells)
• looking at about 15 of these wells, it appears all of them are Madison wells; except for a few early wells, they are all horizontal wells; the vast majority seem to be inactive or in some phase of abandonment
• earliest permit: #04391 
• 04391, 63, Samson Oil & Gas, Kittelson A-1, East Goose Lake, a Madison well, t4/68; cum 338K 4/16; producing about 400 bbls/month;
• most recent permit: #16397 
• 16397, 118/IA, Samson Oil & Gas, Snuffy Stirnweiss 1-33H, Foreman Butte, a Madison well, t2/06; cum 56K last produced 7/15, except for one bbl over one day in 12/15;

Train Carrying Crude Oil Derails In Oregon; No Injuries -- June 3, 2016

http://www.oregonlive.com/pacific-northwest-news/index.ssf/2016/06/oil_train_derails_near_hood_ri.html#incart_email

http://www.kptv.com/story/32134839/emergency-crews-respond-to-train-derailment-in-gorge-school-evacuated#.V1HwCTWI2YI.email

Holy Octane! Did You All See The US Gasoline-Supplied For March Data -- It's Quite Incredible -- Considering 10,000 EVs Are Being Sold Every Month -- June 3, 2016

Updates

June 4, 2016: Don points out and he's completely correct. This huge increase month-over-month, year-over-year cannot simply be due to American drivers only. This happened so fast, and by such a wide margin, something else has to account for some of this growth. Part of the month-over-month growth was noted below (a 29-day February vs a 31-day March) but still the jump was unprecedented.

John Kemp, London-based Reuters analyst has noted that some gasoline produced in the US is exported, mostly to Europe. That may explain some of the jump in US gasoline production. A couple other data points:

• recently all eight French refineries were shut down in France
• French refineries gradually coming back on line, but things are not back to normal
• Venezuela may not be refining a whole lot of gasoline; they cannot pay for the light oil that they need to mix with their heavy oil before refining; see this post from this week;

Obviously the French work stoppage in late May/early June did not affect March gasoline production in the US, but ...

If there is any validity to Don's suggestion, we should see some huge jumps in gasoline production in the US over the next few months. So we'll see. It will be interesting to see if gasoline production in May/June (2016) increases and if any analyst suggests the shutdown of all French refineries had anything to do with it.

By the way, the unions shutting down French refineries was probably pretty stupid: there is no shortage of gasoline globally, so once the logistics was sorted out, France would have adequate sources of gasoline.

US refinery capacity is running at about 89% ... which makes Prince Salman's plan to build more refineries .... should we say, problematic?

Original Post

 

To the best of my knowledge, the March "number" is a record for March. Look at that number: 291,373,000 bbls or 291 million bbls/month of March or 9.4 million bopd in March.

For newbies, March is NOT the beginning of the driving season in the US.

Memorial Day is.

But back to the "number."

Scroll up that list for all the months of March from 1990 to this March, 2016. No previous month of March even comes close to 291,373. The closest was 284,506, back in 2007, just before the US economy went over the recession cliff.

August is the "big" month for gasoline demand in the US. How does the March, 2016, "number" compare with previous months of August? I'm glad you asked. With only a few exceptions, the "number" for March, 2016, actually exceeded the gasoline demand for the busies travel month in the US.

Let's see, on a percentage basis, month-over-month: 291,373 - 266,981 --> slightly more than a 9% increase. Whooo-hoooo. Of course, that's an unfair comparison because March has 31 days; February had 29 days. On a month-over-month, daily basis: 9,399 - 9,206 --> only 2%.

Let's see, on a percentage basis, year-over-year: 291,373 - 280,708 --> just less than a 4% increase.

Kinder Morgan LNG-Export Terminal Moves Forward -- June 3, 2016

Updates

March 5, 2017: update here. KMI retains its original 51%. "Flips" 49% stake it bought from Shell in 2015 to ELC. Project now estimated to cost $1.3 billion.

Original Post 

From Houston Bizjournal:

Houston-based Kinder Morgan Inc. announced June 2 that it has received approval from the the Federal Energy Regulatory Commission for its new $2 billion liquefied natural gas project in Georgia.

The development, dubbed the Elba Liquefaction Project, will be at Kinder Morgan's existing Elba Island LNG Terminal near Savannah, Georgia. It is expected to have a total capacity of 2.5 million tonnes per year of LNG for export, which is equivalent to about 350 million cubic feet per day of natural gas.