Four Wells Coming Off Confidential List Today -- March 3, 2023

CNBC this morning, two takeaways:

• for investors: happy days are here again; and,
• YOLO and FOMO back in play
  
• for conspiracy theorists: it's now accepted, Wuhan flu was a deliberate act of war

Peak oil? From oilprice.com:

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Back to the Bakken

Active rigs: 

Peter Zeihan newsletter.

WTI: $77.77.

Natural gas: $2.821.

Sunday, March 5, 2023: 24 for the month; 186 for the quarter, 186 for the year
39098, conf, CLR, Woodrow 6-32H,
38749, conf, Ovintiv, Sorenson Federal 153-96-9-4-5H,
38341, conf, Enerplus, Dropshot 149-92-31C-30,
36483, conf, WPX, Skunk Creek 12-7-8-16HA,
36482, conf, WPX, Skunk Creek 12-7-8-16H3,
23930 (no typo), conf, Hunt, Oakland 2-18-19H,

Saturday, March 4, 2023: 18 for the month; 180 for the quarter, 180 for the year
39099, conf, CLR, Woodrow 7-32H,
38748, conf, Ovintiv, Sorenson Federal 153-96-9-4-5H,
38616, conf, Hunt, Halliday 146-93-25-36H 4,
28847 (no typo), conf, Hunt, Oakland 2-7-6H,

Friday, March 3, 2023: 14 for the month; 176 for the quarter, 176 for the year
38959, conf, KODA Resources, Stout 1603-3BH, 
38957, conf, KODA Resources, Stout 1622-1BH, 
38615, conf, Hunt, Halliday 146-93-25-36H 3,
38342, conf, Enerplus, Grip 149-92-31C-30H,

RBN Energy: drilling and completion set the stage for hydrocarbon production, part 4. Archived.

Oil and gas production in the Shale Era is a refined, controlled process — and a far cry from the early days of wildcatting a century ago. Modern drilling typically involves multiple wells on a single well pad, with each well going through a four-stage process to produce hydrocarbons that are then separated into distinct components. In today’s RBN blog, we look at how drilling-and-completion techniques have evolved over the years, from old-school vertical wells to the highly complex strategies targeting shale areas today, and how they set the stage for hydrocarbon production and recovery.

EVs: Cash Burn -- March 2, 2023

Update

November 7, 2025: Ford likely to scrap the F-150 Lightning. Link here. 

March 6, 2023: Rivian to sell $1.3 billion in bonds.

Original Post

EVs: Cash Burn -- tracked here. 

In The WSJ, the past two days:

Rivian cash burn. Link here.

From the linked article:

Rivian electric trucks don’t burn gas, but they sure do burn cash. The company’s stock could increasingly become a bet on the funding environment.

Free cash flow for 2022 ended up at a negative $6.4 billion, according to results posted late Tuesday, as Rivian lost money on each car it sold while also investing for the future. Airlines consumed more in pandemic-afflicted 2020, but among tech disrupters throwing new money at old markets this is a number with few peers. Netflix’s free cash flow bottomed out at minus $3.1 billion in 2019, Uber’s at $4.8 billion the same year. Amazon, Rivian’s largest shareholder and customer, has posted bigger outflows for the past two years, but only because of outsized investments.

Tesla once bumped painfully down the same road that Rivian is now on—investing in and ramping up production of the world’s largest and most expensive consumer product. It had at least 13 consecutive years of negative free cash flow, including a low of minus $4.1 billion in 2017, before reaping rewards. Lucid, Rivian’s closest peer, burned through $3.3 billion last year.

Meanwhile, Arrival, link here:

Semiconductors: Hedge Fund Billionaire Has Taken A Passive Position In AMD -- March 2, 2023

See this post where semiconductors are tracked.

The story: billionaire takes a passive position in AMD.  Archived. 

From the linked story:

(Reuters) -Billionaire investor Daniel Loeb on Thursday told investors in his hedge fund Third Point the firm has invested in chip designer Advanced Micro Devices, a source familiar with the matter said.

Third Point, which occasionally pursues an activist strategy and pushes for changes at companies, is not planning to press for changes at AMD and the investment can be considered a passive stake, the person familiar with the fund said.

A spokesperson for Loeb declined to comment and AMD declined to comment.

AMD, which designs chips used in PCs, data centers and gaming consoles Xbox and PlayStation, has seen its stock rise about 21% this year, as analysts expect the firm and its peer Nvidia Corp to power the technology behind AI chatbots such as ChatGPT.

The chip firm's market value, at roughly $125 billion, has pulled ahead of key rival Intel Corp, as its strategy to outsource chipmaking to contract manufacturers such as TSMC helped it gain a technological lead.

Hess With Four New Permits; Seven DUCs Reported As Completed -- March 2, 2023

Breaking:

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Back to the Bakken

Active rigs: 45.

WTI: $77.91.

Natural gas: $2.785.

Four new permits, #39692 - #39695, inclusive:

• Operator: Hess
• Field: Tioga (Willliams)
• Comments:
• Hess has permits for four TI-Beauty Valley permits, NENE 14-158-95, 
• to be sited 525 FNL and between 874 FEL and 973 FEL

Five permits renewed:

• MinnKota Power Coop (3): a Liberty, a Unity, and a McCall, all in Oliver Couunty
• Oasis (2): two MHA permits in Heart Butte;

Two permits canceled:

• Slawson: two Armada Federal permits, Mountrail County (mentioned yesterday)

Seven DUCs reported as completed:

• 36322, 628, Lime Rock Resources, Brew 4-13-12H-143-96,
• 37538, 507, Lime Rock Resources, Emerson 4-24-25H-143-96,
• 37419, 494, Petro-Hunt, Blikre 158-93-6B-7-2H,
• 36954, 1,171, CLR, LCU Ralph 12-27H1,
• 36995, 821, CLR, LCU Ralph 9-27H1,
• 36996, 910, CLR, LCU Ralph Federal 8-27H,
• 38659, 553, CLR,  LCU Reckitt Federal 9-22H1X,

Margins -- March 2, 2023

Yesterday I mentioned "margins."

As a reminder:

Nio: link here.

• gross margins: 3.9% in 4Q22 vs 17.2% in 4Q21 and 13.3% inn 3Q22. 
• vehicle margin: 6.8% in 4Q22; 21% in 4Q21; and 16% in 3Q22

I suggested folks compare a 4% gross margin for Nio with gross margins of some tech companies.

Example, at The WSJ:

For the fiscal year that started Feb. 1, Salesforce is projecting adjusted operating margins of about 27%, up from 22.5% in its recently completed year.

Last year, Salesforce executives laid out to analysts a plan that would boost its adjusted operating margins to 25% by 2026. Before 2022, the company’s margin was perennially less than 20%.

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Ford's February, 2023, Sales

Link here.

Some data points:

• from a year earlier, sales increased by 20%;
• from previous month, increased by 8%
• Ford's F-Series pickups:
• y/y: 22% increase -- includes a spike in sales of its electric F-150 Lightning
• but: EV sales account for onlly 2.9% of Ford's total sales through February
• Ford sales outpaced other automakers
• Toyota's sales: down 8.5% y/y
• Hyundai-Kia: up by 16.2% y/y
• margins not provided