Sunday, September 1, 2013

Mike Filloon On Matador Resources; Hit Songs During the Cuban Missile Crisis; Syrian Missile Crisis; Call Me Maybe

At SeekingAlpha.

Not about the Bakken. Some nice maps of the Eagle Ford and the Permian.


Cuban missile crisis: two 800-lb nuclear gorillas -- high stakes -- 13 days
Syrian missile crisis: two 98-lb weaklings -- two kids in a sandbox -- 13 months


Quick: what was the #1 song during the Cuban missile crisis?

Answer: He's A Rebel, The Crystals.

October 28 – November 10 1962Crystals - He's A Rebel.

The crisis: 13 days in October. The confrontation ended October 28, 1962 when K+6, Mr UN, and K+9 reached an agreement. The blockade was formally ended on November 20. Interestingly, the hit song, was the hit song for two weeks, beginning October 28.

Timing is everything, they say.

He's A Rebel, The Crystals

Quick: what was the #1 song during the Syrian missile crisis?

Answer: Justin Bieber's approved Call Me Maybe, Carly Rae Jepsen. (That may be a dynamic link and may change over time.)

Call Me Maybe, Carly Rae Jepsen

When you watch the video, imagine Vladimir pushing the lawn mower. LOL.

So, Carly isn't sure, "call me, maybe."

Blondie certainly didn't have any doubts. For Blondie, it was simply "Call Me" -- when you're ready, we can share the wine ... roll me in designer sheets ... anytime, any place, ... you can call me anytime....

Call Me, Blondie

I may do a poll: which video did you watch more than once?
  • the Crystals
  • Carly Rae
  • Blondie
Call Me by Blondie was the #1 hit of the entire year, news story of 1980 -- Ronald Reagan's election and the Iran hostage situation. Wow. The songs fit the times, don't they?

President Putin to President O'Bama: "call me maybe." LOL.

Best Story Out Of The Bakken This Month -- Oilfield Wives; Pride

The Dickinson Press is reporting:
There are the military wives of wartime and the astronaut wives of the Space Age. Now, North Dakota is seeing a generation of oilfield wives.
Groups like Real Oilfield Wives have popped up online in recent years, their popularity signaling to the niche the groups fill for women facing circumstances that few outside their situations understand.
The Real Oilfield Wives Facebook page is a place for the women to seek advice and dump worries — about their husbands’ safety, raising kids, finding housing and dealing with the uncertainty of the lifestyle. At a recent gathering of Bismarck-area oilfield wives, the women described being misunderstood, and how the group has helped them meet other women who just “get it.”
This story is huge. Really huge. 

Thirty years plus one day in the USAF taught me a lot about military spouses (mostly wives, but some husbands). 

Do a word search at the linked article for "pride." It's not there. The one thing every oilfield spouse and every military spouse has in common, I would think, is the pride they should have being part of one of most important endeavors for their country. For the oilfield spouses: being part of one of the biggest revolutions ever to occur in their lifetimes and they are part of it. And a very, very important revolution: providing energy for the nation.

Earlier this week, while watching the "Avatar" cartoon series (highly recommended by the way for elementary, middle schoolers, and their parents), our 7-year-old granddaughter asked what "utopia" meant. After giving her the definition, she said that would be awful: "you have to have problems in life or it would be boring."

That incredible insight came from our 7-year-old; I have no idea where she heard that. I can't believe it was unlearned or unheard. As soon as she heard the definition of utopia she replied. She didn't even have to think about it. Life without problems would be boring. Wow.

A Note To The Granddaughters

At this moment in time, there is only place I miss: San Antonio.

Chingon - Malagueña Salerosa, Robert Rodriguez

This, of course, does not include the special moments with three beautiful women: a) a Boston apartment rooftop, Beacon Street; b) classified; c) Military Avenue, west Los Angeles.

The best time, perhaps, in my life: either flying back-seat in F-15s over the Mediterranean, off and on for two years, for the excitement; or the two years we spent in eastern Turkey, Incirlik Air Base, for the camaraderie. 

I miss the Boston area, but I don't have any regrets leaving. We did about all we could do the four years you were there.

That is the same with Charleston, South Carolina: I enjoyed it, but I do not regret having to leave.

Eight years in Germany was one long European vacation but I do not miss it. It was fun while it lasted. It was a happy moment, as the Russians say.

But last night while watching Quentin Tarantino's Kill Bill Volume 2 (for the umpteenth time), I realize now how much I miss San Antonio. I was not born in Texas but I got here as fast I could, like the bumper sticker says. I am Texan through and through. I say I'm from North Dakota but my heart is in Texas. And having moved to the Dallas-Ft Worth area, I have discovered that more specifically my heart is in San Antonio. I think we lived there for 13 years; if so, that was the longest we lived anywhere; only Williston where I grew up (age 2 to 17) was a longer time period, but several of those years hardly count (years 2 through 4, for example, and perhaps the year I was 13 years old).

I don't regret any life decisions, so I don't regret leaving San Antonio. But I do regret not getting my fill of mariachi music to get it out of my system. San Antonio is a very special city. How can one not get energized listening/watching the video above?

The only thing missing, of course, is an accordion but that's because Robert Rodriguez turned it into a rock song.

Sunday Morning Musings

The Japanese Fukushima nuclear debacle is a huge, huge story. Can you imagine this going on in the United States? It makes the 2010 BP-oil "leak" in the gulf pale in comparison. The New Times/StarTribune is reporting:
A crisis over contaminated water at Japan’s stricken nuclear plant worsened Saturday when the plant’s operator said it detected high radiation levels near storage tanks, a finding that raised the possibility of additional leaks.

The operator, Tokyo Electric Power Co., or TEPCO, said it found the high levels of radiation at four separate spots on the ground near some of the hundreds of tanks used to store toxic water produced by makeshift efforts to cool the Fukushima Daiichi plant’s three damaged reactors. The highest reading was 1,800 millisieverts per hour, or enough to give a lethal dose in about four hours, TEPCO said.
The contaminated spots were found as TEPCO employees checked the integrity of the tanks following a leak two weeks ago that released 300 tons of toxic water into the Pacific. That leak prompted Prime Minister Shinzo Abe to announce that the government would step in to help get the plant under control, amid rising public fears of a second environmental disaster at the plant crippled two years ago by a huge earthquake and tsunami.
So, let the activist environmentalists in the US go after the occasional dead duck in a waste pit, or megaloads on Idaho highways, or whatever, while the Japanese continue to release tons and tons and tons of radioactive water into the Pacific. I guess that's one way to keep Greenpeace out of your harbors: fill it with radioactive water.

But, wow, what a disaster Japan has on its hands. After two years, it appears to be getting worse, not better.


Back in the USA, Linda Ronstadt

Now that President O'Bama has thrown the Syrian Missile Crisis back to Congress, this will be the story I will follow: Nancy Pelosi. This will be a hoot. Nothing like watching Nancy wanting to lob cruise missiles. Even the New York Times calls the situation a "box" that President O'Bama has gotten himself into. My hunch: it will all blow over. Two weeks into the debate, someone will ask the question: tell us again, Mr President, exactly what are you asking us to do? What was the question again? I think what is needed is an EIS (an environmental impact statement).



An update from USA Today. I'm sure the link will break over time, but I won't quote any of it today; there is nothing new in it.

Regular readers already know what O'BamaCare has in store for them. But when Walter Cronkite turns on O'BamaCare, one knows it's just a matter of time.

Again, the only significant part of O'BamaCare that hasn't been delayed or deleted completely, is the individual mandate, the on-line health exchanges, and those are a non-starter.  They were supposed to go live October 1, 2013. Not going to happen.

A huge segment of the population can't even figure out how to get a government issued photo ID of some sort for voting purpose. These folks are going to register for health care on-line? LOL. The next time you stroll through Wal-Mart, imagine the folks you see sitting behind a computer signing up for O'BamaCare. They will do it, but it will be the first time they try to access emergency room care. And a "navigator" will do it for them.

Why I Blog; Why I Moderate Comments

When one reads the comments at this link, this tells you all you need to know why I blog and why I moderate comments. Anyone who shrugs off "9/11" has the mental ability of a 5 year old and the sensitivity of a psychopath.

For Investors Only

A reader asked what companies, off the top of my head, interest me with regard to investing, vis a vis, the Bakken, of course.

Before proceeding, folks should read/re-read my "welcome site/disclaimer." I always say this is not an investment site and no one should make any investment decisions based on anything they read here or think they read here.

But there's even more. As I've written at the "welcome" I never intended to post articles about investing on the blog, but I quickly learned one cannot follow the Bakken without following the money. 

One cannot, by the way, follow the Bakken without following what is going on in the rest of the world, especially with regard to global warming and activist environmentalists, and thus the reason for all the posts on those subjects folks have asked me to quit writing about. 

The Bakken makes investors skittish. This is the analogy. Even when there is only talk of a bit less stimulus by Ben Bernanke, the market seems to fall one to five percent in a day/week; think what will happen if tapering is announced. Likewise, the Bakken is all about fracking. The Feds will soon announce new rules, and emotionally, the market will react. Even if the fracking rules don't change a thing, the headlines will make investors skittish, there will be an "I told you so" and some folks will get out of the Bakken. It might not be much of a pullback but it will occur. Now, imagine if the fracking rules actually make a material change in the Bakken. It will be a gut-wrenching moment. Right now there is a perception that there is glut of natural gas hitting the market, and that provides the opportunity for the federal government to slow things down; big money is involved here, and a glut of natural gas is not in everybody's interest. Anyone who ignores the Federal government and fracking rules is doing investors a disservice. One has to at least be aware of the risk. Again, before the end of 2014, there will be a headline somewhere: US government issues new rules on fracking.

I am fortunate enough that investing for me is simply a hobby. I don't take it particularly seriously. I have no formal training or education in financial management. Less than one percent of my total life portfolio (pension, social security, annuities, equities, family) is invested in the Bakken. I am interested in the Bakken as a phenomenon, not for its investing possibilities.

I am an investor, not a trader, though occasionally I do some short-term investing (which usually gets me into trouble).

So, take the following as idle chatter one might hear over coffee at Williston's Economart. This idle chatter is not even worthy of an investment club.

1. Speculative: of the operators, I like those who have acreage outside the Bakken, like EOG. I only like companies focused on oil, not natural gas.
Chesapeake was a great opportunity a few weeks ago; it is changing its focus. Slower than EOG in going from natural gas to oil, but the change is there for CHK. If interested in operators, I strongly recommend following Mike Filloon over at SeekingAlpha. If I recall correctly, he suggested Triangle Petroleum and Halcon. Oasis is struggling right now (share price); I don't know if there is a fundamental problem with the company or if this is just a "2013 wet spring" thing. SandRidge is interesting. Actually, I'm so excited about what is going on in the oil and gas industry in the US it's easier to list operators I stay away from (in general) than operators I like. KOG is a trading stock; of all the Bakken operators, for me it is the most interesting to follow: I missed this one big time (my bad) but it carries significant baggage with all its assets in the Bakken, and much of that under BLM management.

With regard to operators, I think we are still in the first or second inning of the Bakken, and so I still warm up to companies who are still acquiring acreage, even at a premium: the most recent example: Whiting.  A much better investor than I reminds me at least once a month: DNR. Its niche: EOR.

At the end of the day, this is how I am investing in the Bakken: I don't own minerals, so I do the next best thing. I buy a few shares every month in at least one operator in the Bakken who appears to be accumulating acreage or accelerating activity. Even with discount brokers, it's a crazy way to invest: it would be better to accumulate more cash over three to six months and buy all at one time, but I'm willing to spend the $8.95 in commission, regardless of the size of the purchase (and some of them are pretty small), to add more shares to the portfolio. I have a twenty- or thirty-year horizon. I will never see the money; it will all be left to the granddaughters.
2. Conservative: pipelines and railroads. After Warren bought BNSF, I started adding UNP to my portfolio.
I have been thrilled with Enbridge and all the companies under the Enbridge umbrella. Like the ObamaCare bill, I bought Enbridge before I knew what it was all about. After buying shares in it, I started reading. I have learned more about the pipeline business than I ever expected. There have been a lot of articles on MLPs and pipelines the past few months. Great educational opportunities but one has to watch these closely. The government is watching them closely. I learned my lesson with Enerplus (ERF) which the company changed its business model because of the Canadian tax policy change some years ago. 
3. Very conservative: MDU was one of my two or three favorite companies back in the 1980s (the other was BNSF, and some utility in California).
MDU really took a beating during the recession and misplayed the Bakken boom, but it's one I would recommend -- yes, recommend -- that young investors with a very long horizon at least start following. They have some new folks on board and if the US economy ever does take off, they are nicely positioned. I don't hold any MDU and probably never will, but that's probably more emotional than rational.
4. So, what else? It's hard for me to find an operator I don't like in this US energy revolution; I like railroads and pipelines; I would want young investors to follow MDU for awhile. Be sure to scroll down my "snapshot" page to quickly see all the operators in the Bakken. 

5. I think the easy money has been made in the Bakken (example: at one time KOG sold for 60 cents and it quickly went to $6.00). I don't see the Bakken as a slam dunk any more. I think one needs to follow companies for awhile, and do lots of reading. It's hard to beat Mike Filloon. If I was going to attach my wagon to one horse, it would be Filloon. Of course, if one is interested in a rodeo bronco ride, jump on Jim Cramer's horse.

I might add to this post later, and I might change some of it later on. But this is my "off the top of my head" about the Bakken.

Completely Off My Rocker
A Note To The Granddaughters
Very, very violent: not recommended

I don't know where to place this but I don't want to lose it in case YouTube deletes it. I have not recently watched the scene in its entirety and I probably won't.

As regular readers know, I'm in a Quentin Tarantino Kill Bill  phase which probably won't last long; it is for the music more than the video, although Kill Bill, Volume 2, is very, very good. 

This is taken from the Japanese Unrated Limited Edition DVD of Kill Bill. It contains extra scenes that were cut from the original and is completely in color. Reasons why the movie theater and regular dvd versions were in black and white: 
  • Tarantino was forced to censor the scene in some way to limit the visual of obscene gore. The MPAA did not specify how to do this so he decided to cut a few scenes and change it to black and white. 
  • He also chose black and white as an underlying obscure/random reference to the 70s and 80s. There are 88 keys on a standard piano, the Crazy 88's wear black and white (the colors of a piano). [Why Piano? Tarantino likes to use instrumental metaphors].
  • During production they under estimated the amount of blood needed to shoot the scene. They ran out of blood and thus made the scene B/W to hide some of the clear splatters and spray effects. 
  • There might be MORE than 88 members in The Crazy 88's. During this fight scene alone, I can count 81 gang members either killed or with sliced limbs (There are even more because some shots were too fast to count). Don't forget the others that were killed before GoGo and the others killed right after this scene before the final fight with O-Ren.
  • Officially there are about 40 actors listed in the credits of the film as Crazy 88 members. This is because in the movie industry, extras or background actors, have to have a minimum total of screen time (2-5 minutes total) in order to be officially listed in the credits of the film. Most of the actors in this scene had a screen time of less than a minute combined total, meaning that a lot of these people were not listed in the credits.
  • I apologize for not getting the entire scene, especially the spanking katana scene. I uploaded this video back when YouTube restricted normal users to 10 minutes only. 

Sunday Morning

Good morning! Wow, what a beautiful day for biking. I slept in a bit late for my slow cooker could finish, so I missed Jupiter this morning. But it's a beautiful day in the Dallas area. Not so much for South America where they are having a brutal winter. Algore needs to take a jet trip to Peru. The BBC, generally considered a pretty trustworthy news outlet, is reporting:
The Peruvian government has extended to nine more regions a state of emergency called to cope with unusually cold weather and heavy snowfall.
At least two people have died and 33,000 others have been affected by the cold spell, local officials say.
But folks are still worried about global warming. The New York Times is reporting a silver lining in China's smog:
China has been the world’s biggest emitter of carbon dioxide from fuel use since about 2006, when it passed the United States. In 2009, the Chinese government introduced a policy to reduce the carbon dioxide emitted in the production of each unit of economic activity by 40 to 45 percent by 2020, compared with levels in 2005. That means emissions grow along with China’s economy, but at a slower rate than if there were no improvements.
Even with such efforts, China’s size and feverish growth have pushed its emissions well past those of the United States. By 2011, China’s carbon dioxide emissions from fossil fuels accounted for 28 percent of the global total, and the United States’ for 16 percent, according to the Global Carbon Project, a consortium of researchers. The International Energy Agency estimates that China’s emissions grew by another 3.8 percent in 2012.
It's a feel-good story, a pie-in-the-sky story.  The article quotes a Chinese official saying that China, unlike the US, will not risk its economy over concerns of global warming (which has now paused for at least 17 years, which even the UN has noted). It's a feel-good story, a pie-in-the-sky story because nowhere in the article, unless I missed it, does the writer provide the number of coal-fired plants the country has today, and now many more China has on the drawing board. I believe, for round numbers, China as about 400 new coal-fired plants on the drawing board.

You know, now that I reflect on the headline and the story, and knowing the New York Times is pretty much broke, one wonders if the entire story was simply a press release put out by the Chinese government. Re-read the article in that light. It's interesting. The NYT editor could have simply put in some editorial comment, sort of like a blog.

The Times inconveniently forgot to mention just how low CO2 emissions are in the US -- how far they fell in 2012. Even The Huffington Post, a blog, did better:

It was only a "little-noticed report" because mainstream media did not want to report it.