The Million Dollar Way (The Bakken Oil Blog)

Wednesday, July 20, 2022

It's Closing Time, See You In The Morning -- Good Luck To All -- July 20, 2022

Things Have Changed -- July 20, 2022

Things have changed:

coal is the new "security fuel";
auto manufacturers are in deep doo-doo; they just don't know it yet;
$100-oil for the long haul;
oil super-cycle is just beginning;
Bitcoin? Last "coin" standing?
"Only Murders In The Building": "Twin Peaks" for the 2020s but so much better;
next Fed rate increase: one and done
OPEC+: spare capacity is a myth;
Russia: no technology infrastructure to re-build military hardware lost in Ukraine;
Russia: no technology to replace western technology needed for oil patch;
call it a recession; but it ain't;
5%: the new "easy money";
M2;
psychedelic microdosing is the new speed;
canned tuna is the new protein;
ERCOT reliability;
at best, a Pyrrhic victory for Putin;
USC football: national champs favorite;
Biden will still beat any GOP rival in 2024;
I used to care but things have changed.

I Ain't Go No, I Got Life --

What A Great Country -- Idle Rambling Wednesday -- July 20, 2022

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.

Wow, I'm in a great mood.

The NDIC GIS map server is back up and so is the "rig" location list.

Wow, this is outstanding. It will take me a few days to get used to the new map, but the new app is so robust it is going to be hoot.

In an earlier post I noted that COP was going to exit the Gulf of Mexico and casually asked what the rest of the story might be?

Well, it turns out that:

Shell is also going to exit the Gulf of Mexico. Actions have consequence. The Biden administration wants to shut down drilling on federal land (onshore and offshoree) and apparently Shell and COP are willing to play along.
I used to own shares of Shell, but no longer. I am still heavily invested in COP. Just imagine all the cash Shell and COP will generate when they sell their assets in the Gulf and get rid of all that CAPEX. Can you say "dividends" and "buybacks"?

Speaking of investing, some folks are starting to ask the same question I've already brought up: auto manufacturers are in deep trouble. They just don't know it yet.

EVs are going to suck them dry, margins are going to be minimal, competition will be keen. This story that Ford is laying off 8,000 blue collar ICE workers to concentrate on EVs. This speaks volumes. EVs are sucking the cash out of auto manufacturers.

Tesla: free cash flow this past quarter.

Look at the numbers. I believe their free cash flow was less than the cash raised with the sale of their bitcoin. We'll sort that out later, but if accurate, that speaks volumes.

Silver coins: Recently, I mentioned the worst investment one can make: silver coins and/or silver bullion. It turns Aaron thinks just like me. Link here.

**************************
Clearing Off The Desktop

Some graphics yet to be posted.

LNG to France: great thread and great graphics.

Gaslighting: I guess "they" are reading the blog. Not long ago I talked about the Biden administration gaslighting and keystoning America.

Now, from zerohedge, it's almost as if this whole "green" thing is the biggest gaslighting in history. Link here.

$100-oil: despite draining the SPR, oil remains at $100. What happens when October comes? Others are also asking. Several things:

if necessary, "they" will keep draining; the law says a minimum must be kept in storage, but if there's an emergency, reserves can go lower;
the emergency: midterm elections in November;
so, they will continue to drain thee SPR well past October; trust me on this;
and, then after November, it really doesn't matter and we'll be past the driving season also

Biden says he has cancer: got it from Delaware pollution, he says. That must be solar pollution. Skin cancer? I assume he got it driving big rigs across the southern US for two decades before becoming a US senator.

BRK-buying surge: now we know why.

The rumors were that it was due to Robinhood. Turns out the rumors were correct. I can't make this stuff up. A purchase of 1/1000th of a share of BRK was rounded up to a full share by regulation for reporting purposes only, so one thousand slices of 1/1000th of BRK = one thousand shares trading hands. A million 1/1000th slices = one millions shares, when in fact, only 1,000 share were traded. I assume this is driving Gary Gensler nuts.

Best story of the day: the combatant commander for the US South Command -- a helicopter pilot. Link here and here.

At the first link, be sure to read the last line. I was sure this US South Command commander had a wife. LOL. I will share these links with our granddaughters.

Investing: amazing the crazy comments over on twitter.

The Dow surges 750 points in one day. That evening futures point to a 30-point loss. Some take this to suggest the rally will be short-lived. Must be a newbie. And so what if the rally is short-lived. Just another opportunity to accumulate shares in great companies at great discounts.

19%. Apparently that's the percentage of Hispanics who support Biden. Link at National Review.

COP Looking To Exit The Gulf Of Mexico -- July 20, 2022

Reuters:

COP looking to sell its stake in the Ursa platform and Princess subsea well in the Gulf of Mexico;
it would mark COP's exit from deepwater energy production off the US Gulf coast.

It will be interesting to "see" the rest of the story.

A year ago:

From the linked about one year ago:

ConocoPhillips is set to become the second-largest oil and gas producer in the contiguous U.S. following its $9.5 billion purchase of Royal Dutch Shell PLC’s assets in the Permian Basin.

The company’s acquisition of 225,000 net acres in West Texas is a big bet that drilling in the busiest American oil field will underpin returns for a decade. It is also the latest example of how competition to consolidate is reshuffling the pecking order among top U.S. shale drillers.

ConocoPhillips has been among the biggest spenders in the recent consolidation wave. It closed a $9.7 billion purchase of Permian oil producer Concho Resources Inc. in January, before disclosing its plans to buy Shell assets.

From April 26, 2022, oilprice, Goldman Sachs: top five shale plays for 2022, remember, GS still rules Wall Street: