I still believe the most interesting number is active frac spreads. Drilling a well is less than 30% of an AFE today. The number that really matter is the DUC conversion rate. I am thinking about drilling and casing 5 wells in the next 3 months just because services are going to be so cheap. No intent to complete until pricing makes a meaningful recovery. Sent from my iPhone using Tapatalk
Interesting to see the leverage in futures contracts rear its head. Posted WTI was what today? Gentlemen, place your bets and buckle up, we’re in for an amazing education about what happens when speculation occurs to the tune of 50+ years of supply. And on the other hand, it’s going to be equally amazing if producers don’t start reducing production and negative pricing hits the PHYSICAL markets within the next 45 days as storage is completely filled. Every day that goes by is literally 10 days further into the abyss until oil pricing recovers.
Dr. Beeper: the hedges are a financial contract that don’t actually require the production of barrels. If they’re hedges with BP -and don’t have the bank as a counter party, I don’t see why there would be a problem. If the wells are as prolific as you describe, there’s not much likelihood that they’ve hedged 100% of the expected production from the new wells as most credit facilities frown upon greater than 75-80% coverage of actual produced PDP volumes. I just went through a similar situation with 3 wells coming online at the end of the year. I didn’t hedge until I got too nervous to roll naked on the production and didn’t have any early decline to model. We’ve ended up slowing our ESPs down to maximize hedge coverage, essentially self curtailing. In this case, with the hedges in the money and no completion on the new wells, I would be inclined to believe the banks would waive the coverage percentage as long as excess proceeds were used to repay outstanding borrowings. Ultimately, I think we’re going to need some people to step up in leadership and state it’s in in the best interest of the domestic producers to slam on the breaks and self curtail before we see low single digits. Unfortunately, I think demand is off 30% and will be for at least another 2 months, especially if we’re quarantined into the summer. We need to avoid maxing out storage ASAP, because it’s inevitable. We can do it voluntarily or be forced to do it when we have to shut in due to the evaporation of takeaway capacity. Sent from my iPhone using Tapatalk
Interesting thing these days. At one point, the biggest question associated with this story would be “Why the fuck is one of Iran’s highest ranked Generals in Iraq, and why the fuck are the Iraqis not killing him?” Sent from my iPhone using Tapatalk
But you can’t have your cake and eat it too. If Roach’s hit was targeting and ejectionable, the same situation applies to the CJ hit. The inconsistency in application is so damn frustrating. Sent from my iPhone using Tapatalk
No idea how much of SA’s exports are refined products; however I would assume it’s a big percentage. If you’re trying to cripple their economy for at least a few months it makes sense to target the bottleneck in getting products out, as opposed to pump jacks which will be more spread out. Rebuilding a refinery is going to be much more complicated than hitting the actual production facilities inmo. Sent from my iPhone using Tapatalk
CXO: Christ.... that wasn’t that bad of a miss. They’re now trading at $17,500ish an acre. Thought they’d be the last Permian domino to fall, but with today’s movement you’d think they’d have a huge buyout bullseye on their chest. Sent from my iPhone using Tapatalk
Heading up to Pagosa Springs for a week with the family. I think I'm going to have a few days that I can sneak away and wet a line. Any recs for a guide? I know next to nothing about freshwater fly fishing, but would like to try it out. I have a 5wt rod/reel I can most likely use, but don't have any other gear.
Thanks in advance.
I see majors taking a run at the Permian focused Independents. CVX bought Anadarko because of their Delaware basin holdings, much of which sits over CVX owned minerals. XOM will make a move in the next year, with prime candidates being PXD, Concho, FANG, or Endeavor. As a Midlander, consolidation is going to be really weird. It’ll be interesting what type of presence in West Texas the majors/large independents maintain. Sent from my iPhone using Tapatalk
Thanks for the post. All of it, but especially this part. I think the greatest gift Ben has given us so far is that we truly appreciate all the little things he learns and the new skills he picks up; stuff we took for granted with the first three kiddos. Little man has figured out how to give kisses, and I will say there is literally nothing better right now than when he plants a big one on me. This happened the other day: I had all the kids at home on a Saturday while my wife was out running some errands and getting out of the house by herself for a bit. I left Ben in his room to play and it got really quiet. I went to check on him and saw this: His big brother had gone into the room and was reading him a book. Normally, big bro doesn’t have a lot to do with the little guy. I can’t tell you how proud I was at that moment of my kids. Sent from my iPhone using Tapatalk
Thought I’d throw out an update for those who are interested: Ben’s now a little over 19 months. He. Is. A. Bad. Ass. He’s been attending a Mother’s Day Out program at a local church, and the ladies that manage the room love him. Unfortunately, he’s very susceptible to respiratory infections and has been through the RSV crap a few times. We’ve been pretty lucky so far with only one hospitalization over the last year. We’ve had to put him on oxygen at home at night probably 4 times over the last year (about a week on O2 for each instance). It’s a hell of a process, and usually involves duct tape so he can’t pull the nasal cannula out while he’s sleeping. The main reason for the tape is to keep him from bending his arms so he can’t reach his face. Very thankful for the NICU nurse that gave us the pro tip. The coolest thing is that Ben is now starting to sign a bunch. He’s got a few of them down pat, which is awesome. He’s also starting to talk a little bit. Last week I got in the car to go to lunch with my wife and Ben, who was in the back seat. I got in and totally got an excited “DADDA!” Unfortunately, my wife was chopping onions in the car for some damn reason... Ben’s still doing physical therapy every week. He isn’t crawling or walking yet, but damn if the kid can’t butt scoot around with the best of them. He’s also doing a great job of feeding himself and is doing great with his cup and drinking. So far we’ve continued to be very blessed with his health, with no significant health issues. I am continually amazed by the kindness of strangers we run into. Ben waves at just about everyone who makes eye contact, and it’s amazing how many people wave back and stop and coo at him. So, still a lot to figure out in the long run, but things are going fantastically well, and I’m so proud of our little guy. Sent from my iPhone using Tapatalk
As a former Spur, I’m loving how involved Bevo is. As someone who manages risk on a daily basis, this is terrifyingly awesome. Sent from my iPad using Tapatalk
That one was terrible, I agree. But he’s left on an island more than anyone else on our team, and does a decent job of knowing when he’s beat and when to commit the penalty. He also knocked a ball away from #5 that was a sure TD. Sent from my iPhone using Tapatalk
Boyd was flagged a bunch, but IMHO those were saved touchdowns and we’ll earned. Rather take the 15 and live to fight another day. Sent from my iPhone using Tapatalk