Energy Sector

[Pelagic]

8 hours ago, Ulti said:

I think his model works in a sliding scale depending on the price of O&G

https://podcasts.apple.com/us/podcast/columbia-energy-exchange/id1081481629?i=1000584701043

comprehensive look at Euro energy outlook over the next few years…. Looking forward to hearing VET’s outlook soon

 

I think he's using strip pricing in his model for European gas since even at relatively low WTI/AECO prices of $70/4.5 he has VET at $138. Would also explain why VET is kind of an outlier on his price targets sheet relative to current price since Euro gas affects it a lot more than the other Canadians he covers.

 

Thanks for the podcast link, it was quite informative. 

 

[Ulti]

Agree about the podcast ;Columbia energy exchange usually provides good info

( though I'm old ,deaf and have a difficult time with thick French accents haha)

[Ulti]

And i just gotta say ,It's surrealistic listening to an energy podcast and filling up my tank at costco ....$2.94

[Ulti]

https://www.yahoo.com/entertainment/biden-didn-t-fight-big-145650796.html

Rolling Stone article..The Other Side

[Pelagic]

18 minutes ago, Ulti said:

https://www.yahoo.com/entertainment/biden-didn-t-fight-big-145650796.html

Rolling Stone article..The Other Side

 

This article really went off the rails toward the end lol

 

Let's say the most likely scenario next week is Reps win the house and senate is split 50/50. That doesn't exactly strike me as a drill baby drill outcome. Even a Rep majority in the senate likely doesn't benefit oil companies as much as the author hopes.

 

Quote

In fact, if Republicans win anything, you can expect a full-on restoration of Big Oil to the throne, as well as legislation that re-directs the flow of public and private money toward anyone and anything that can slow, stall, or divert the transition to clean energy. Like the MAGA crowd, Big Oil thrives on lies, chaos, disorder, and disruption. So expect lots of it. For Trumpers, burning fossil fuels is how you Make America Great Again. They will defend pipelines with guns and sweet-talk Putin and melt every glacier in Greenland if it means more cheap gas.

 

[james22]

39 minutes ago, Ulti said:

https://www.yahoo.com/entertainment/biden-didn-t-fight-big-145650796.html

Rolling Stone article..The Other Side

 

LOL

[dealraker]

So as to those in the business of predicting anything as to oil and gas...

 

....there was this legendary dude named T Boone Pickens who most considered God of oil gas cycles and such.  Uh yeah, I remember well his immense following.

 

Dude started a fund...with huge fanfare.  Lost 98 percent of his investors money..fast, real fast.

 

An option to expertise investing as to oil and gas is simply to allocate when it's market cap is exceptionally low to total market cap.  And do not do the "value investor" brain dead mistake of selling too soon.   You simply can't make up in new bargain ideas what you lose from selling too soon.

Edited November 4, 2022 by dealraker
Misspelling

[Dinar]

24 minutes ago, dealraker said:

So as to those in the business of predicting anything as to oil and gas...

 

....there was this legendary dude named T Boone Pickens who most considered God of oil gas cycles and such.  Uh yeah, I remember well is immense following.

 

Dude started a fund...with huge fanfare.  Lost 98 percent of his investors money..fast, real fast.

 

An option to expertise investing as to oil and gas is simply to allocate when it's market cap is exceptionally low to total market cap.  And do not do the "value investor" brain dead mistake of selling too soon.   You simply can't make up in new bargain ideas what you lose from selling too soon.

Mesa Petroleum did not do so well either if I remember correctly

[Gregmal]

Ole T Boone LOL. Same with the Sandridge founder who’s name escapes me. It’s part of my aversion to individual companies here. I am the patsy at the table with energy specifics. I hear the folks who know a thing or two talk and am like yea, I’ll be holding the bag. So I generally stick to futures and etfs plus maybe some of the big proxies like XOM et al. All you gotta see is the backdrop through, and it’s clear as day. Energy still a no brainer as it has been for 18 months now. 
 

 

[SharperDingaan]

But then every now and again you meet a 'one-off' master at his craft ...... Smilin' Jack!! 

https://searcharchives.ucalgary.ca/jack-gallagher-fonds

 

The man was truly brilliant at charm, and way ahead of everyone else.

As a engineering student, summer drilling hand at the time, even I could readily see that! ... and damn he was good! He could be sending you to the shittiest, coldest, most hostile places in Canada's north - and you would swear that it was the angels telling you to forget the comforts, and go North young man! And you did !!.

 

SD

[bizaro86]

1 hour ago, SharperDingaan said:

But then every now and again you meet a 'one-off' master at his craft ...... Smilin' Jack!! 

https://searcharchives.ucalgary.ca/jack-gallagher-fonds

 

The man was truly brilliant at charm, and way ahead of everyone else.

As a engineering student, summer drilling hand at the time, even I could readily see that! ... and damn he was good! He could be sending you to the shittiest, coldest, most hostile places in Canada's north - and you would swear that it was the angels telling you to forget the comforts, and go North young man! And you did !!.

 

SD

 

And all those arctic assets plus $3 will get you a cup of coffee now.

 

Investors do and have done better with the green eyeshade types (eg Murray Edwards) than the charismatic wildcatters (who almost inevitably end up having debt issues in a downturn, which is what happened to Gallagher's Dome)

 

But hey, CNQ has most of the office space in Dome Tower now on a cheap lease. I understand from someone who knows that they were offered to have the building name changed but declined because they didn't want to pay for the cost of replacing the signage.

 

I invest for money more than romantic stories. Different strokes.

[Spekulatius]

My favorite oil tycoon was Armand Hammer (Oxy petroleum). stock trades like crap, but he had fun doing his thing.

https://en.wikipedia.org/wiki/Armand_Hammer

 

If I recall correctly, one day the stock jumped and it turned out the news was that Armand had slipped and broke a leg or hip when trying to step out of his bathub. Wall Street can be a cruel place.

[SharperDingaan]

All these colorful folks could not have done what they did, without a long line-up of investors, creditors, and politicians of the time throwing their money at him/her. And ultimately all were pissed, because the colorful folks were simply far better at the game than they were, and by many a country mile. The smart thing was to walk away on day 1.

 

There was a time when Dome Petroleum owed a Canadian Sched-A bank so much money, that to call in the Dome Petroleum loans, would have threatened the solvency of the bank itself. Toxic debt had to be rolled for a time, until the banking industry could implement a 'safe' unwind. Very few people can do that.

 

Penn West Petroleum was one of these companies run by the green eye-shade folks, so when things eventually blew up .. the hate on them was not that dissimilar. Today the green eye-shade folks are gone; but they still have the great land position, new management, and a new name - the hate ain't never going away! It's Obsidian Energy today 

 

And those green eye-shade folks? We own a few shares in their current companies and have done very well by them thankyou - all original investment capital safely recovered, and parked in Canada's 

 

SD 

Edited November 4, 2022 by SharperDingaan

[james22]

Hate?

 

Enron.

[bizaro86]

2 hours ago, SharperDingaan said:

All these colorful folks could not have done what they did, without a long line-up of investors, creditors, and politicians of the time throwing their money at him/her. And ultimately all were pissed, because the colorful folks were simply far better at the game than they were, and by many a country mile. The smart thing was to walk away on day 1.

 

There was a time when Dome Petroleum owed a Canadian Sched-A bank so much money, that to call in the Dome Petroleum loans, would have threatened the solvency of the bank itself. Toxic debt had to rolled for a time, until the banking industry could implement a 'safe' unwind. Very few people can do that.

 

Penn West Petroleum was one of these companies run by the green eye-shade folks, so when things eventually blew up .. the hate on them was not that dissimilar. Today the green eye-shade folks are gone; but they still have the great land position, new management, and a new name - the hate ain't never going away! It's Obsidian Energy today 

 

And those green eye-shade folks? We own a few shares in their current companies and have done very well by them thankyou - all original investment capital safely recovered, and parked in Canada's 

 

SD 

 

I agree the most successful of the colorful folks tend be those who can get people to truly believe in the story they are selling - and to put their money toward it.

 

In o&g the colorful types have the best stories, but their investors don't have the best experience.

 

Murray Edwards left Penn West because he didn't want them to convert to an income trust on 2005. The subsequent management were finance types who ended up with a big accounting scandal and destroying tons of value (as you know). 

 

The guys who sweat the assets (but don't cook the books) are the ones you want.

[UK]

https://www.barrons.com/articles/warren-buffett-bets-big-on-energy-51667929870

 

Buffett was asked at the Berkshire shareholder meeting last year about the Chevron investment and whether he was comfortable owning an oil stock given the role of fossil fuels in warming the planet. “If you expect perfection in your spouse or your friends or in company, you’re not going to find it,” Buffett responded. “Chevron is not an evil company in the least. And I have no compunction in the least about owning Chevron. And if we own the entire business, I would not feel uncomfortable about being in that business.” Buffett then asked Berkshire Vice Chairman Charlie Munger for his view, and Munger said: “Well, I agree. You can imagine two things. A young man marries into your family. He’s an English professor at, say, Swarthmore, or he works for Chevron. Which would you pick? I’d take the guy from Chevron.”

[Jaygo]

The demonizing of the oil industry is so odd. It really shows how stupid people are. 
 

we have this miracle product that has risen our standard of living to 100 fold and people shit on it. 
 

I remember front page news when 500 geese died on a tailings pond in fort Mac. Sad to be sure, but on any given day people are out shooting ducks with birdshot and we call it sport. 
 

a funnier anecdote was a snowmobile weekend with some great friends. We’re sitting around a huge natural gas fireplace in my buddies 3 bedroom cabin perched by the lake. 
We’re all drinking spirits from around the world and my friend is going off on how bad fossil fuels are. This is an intelligent person generally but I laid into him with vigor. Dude we just burnt 200 bucks of premium in our sleds, drank wine from New Zealand and had steaks from Alberta, shrimp and veggies from who knows where. Now we’re toasty by a fire in the middle of winter 300 km from our currently heated homes.
Yep these fossil fuels are terrible. he did not really see the irony in it all
 

 

[rkbabang]

1 hour ago, Jaygo said:

The demonizing of the oil industry is so odd. It really shows how stupid people are. 
 

we have this miracle product that has risen our standard of living to 100 fold and people shit on it. 
 

I remember front page news when 500 geese died on a tailings pond in fort Mac. Sad to be sure, but on any given day people are out shooting ducks with birdshot and we call it sport. 
 

a funnier anecdote was a snowmobile weekend with some great friends. We’re sitting around a huge natural gas fireplace in my buddies 3 bedroom cabin perched by the lake. 
We’re all drinking spirits from around the world and my friend is going off on how bad fossil fuels are. This is an intelligent person generally but I laid into him with vigor. Dude we just burnt 200 bucks of premium in our sleds, drank wine from New Zealand and had steaks from Alberta, shrimp and veggies from who knows where. Now we’re toasty by a fire in the middle of winter 300 km from our currently heated homes.
Yep these fossil fuels are terrible. he did not really see the irony in it all
 

 

Well said.  People can be incredibly stupid on certain subjects and political and/or religious beliefs tend to amplify the stupidity to enormous levels.

[Mephistopheles]

I met a young self proclaimed “communist” at a bar in NYC last night. He was probably about 25yo. At various parts of the night we spoke about John D Rockefeller and also the Soviet Union. He though the former was evil and that the latter was great.
 

It was mind numbing listening to this kid who has figured out the world at such a young age. There was no convincing this guy of reality.
 

But we wouldn’t be where we are if people weren’t so stupid. So am thankful for ESG and all the lunatics associated with it.

[nafregnum]

10 minutes ago, rkbabang said:

Well said.  People can be incredibly stupid on certain subjects and political and/or religious beliefs tend to amplify the stupidity to enormous levels.

 

+1 to these thoughts.  I'm finishing a book called "The Delusions of Crowds",  full of examples of financial and religious manias. 

 

One of the superpowers of homo sapiens is our capacity to imitate.  Some ancient hunter figures out how to make a better kayak or spear and the idea spreads through imitation.  Narratives and beliefs spread in similar ways -- if your friend "knows" something and tells you about it, then you might now "know" it too.  The Economist recently had an article about how a bunch of people have gullibly accepted the rumor that some public schools are now putting cardboard litter boxes into the bathrooms for the children who believe they are cats and dogs.  It's like how parents began to believe that halloween candy needed to be X-rayed first to make sure no razor blades were hidden in the snickers bars.  Fake news travels 7x faster across social media.  Surprising and dramatic stories run on their own legs.

 

On a daily basis we are told that the planet is heating up and dying.  That's a dramatic narrative if there ever was one, and tweaking and repeating this tale is a boon to news media which now has a perennial scare tale to tell, with the added benefit that they get to feel righteous for telling it and thus doing "their part" to fix the problem.  Really they're just scaring masses of people into feeling horrible about that extra minute of hot shower or leaving the lights on or using straws.  Religious narratives used to help humans to deal with the existential dread of looking forward and seeing the certainty of one's own death.  Religious belief is waning across much of the world, leaving many people exposed to the terror of death, but now it's even worse than in centuries past because we are also invited to consider such thoughts as (1) the death of all humans, (2) ecological collapse, (3) the  eventual death of the sun, (4) the heat death of the universe.  

 

So... the world is ending on one hand, and I'm to blame because I take hot showers and have air conditioning and do 1,000 other earth destroying things each day.  That's a stressful psychological state to maintain.  Hating on fossil fuels provides a release valve for some of the psychological pressures, regardless of the obvious hypocrisy.  In a lot of ways, fossil fuel companies are the scapegoat -- people are transferring their own "sins" onto the head of the scapegoat to ease their feelings of guilt.  It's like they are the new tobacco companies. 

 

The recent Rolling Stone article was a transparent example.  Externalizing  blame.  Virtue signaling.  Denial.  No invitations to self examination, no calls for reducing consumption here in North America.  No concept of the second level effects that would result from "punishing" big oil.  Very little understanding or respect for economic principles or history.  But it sure feels nice to be righteous and to know who is to blame!  Burn the witch!

 

 

 

 

 

 

[rkbabang]

15 minutes ago, nafregnum said:

 

+1 to these thoughts.  I'm finishing a book called "The Delusions of Crowds",  full of examples of financial and religious manias. 

 

One of the superpowers of homo sapiens is our capacity to imitate.  Some ancient hunter figures out how to make a better kayak or spear and the idea spreads through imitation.  Narratives and beliefs spread in similar ways -- if your friend "knows" something and tells you about it, then you might now "know" it too.  The Economist recently had an article about how a bunch of people have gullibly accepted the rumor that some public schools are now putting cardboard litter boxes into the bathrooms for the children who believe they are cats and dogs.  It's like how parents began to believe that halloween candy needed to be X-rayed first to make sure no razor blades were hidden in the snickers bars.  Fake news travels 7x faster across social media.  Surprising and dramatic stories run on their own legs.

 

On a daily basis we are told that the planet is heating up and dying.  That's a dramatic narrative if there ever was one, and tweaking and repeating this tale is a boon to news media which now has a perennial scare tale to tell, with the added benefit that they get to feel righteous for telling it and thus doing "their part" to fix the problem.  Really they're just scaring masses of people into feeling horrible about that extra minute of hot shower or leaving the lights on or using straws.  Religious narratives used to help humans to deal with the existential dread of looking forward and seeing the certainty of one's own death.  Religious belief is waning across much of the world, leaving many people exposed to the terror of death, but now it's even worse than in centuries past because we are also invited to consider such thoughts as (1) the death of all humans, (2) ecological collapse, (3) the  eventual death of the sun, (4) the heat death of the universe.  

 

So... the world is ending on one hand, and I'm to blame because I take hot showers and have air conditioning and do 1,000 other earth destroying things each day.  That's a stressful psychological state to maintain.  Hating on fossil fuels provides a release valve for some of the psychological pressures, regardless of the obvious hypocrisy.  In a lot of ways, fossil fuel companies are the scapegoat -- people are transferring their own "sins" onto the head of the scapegoat to ease their feelings of guilt.  It's like they are the new tobacco companies. 

 

The recent Rolling Stone article was a transparent example.  Externalizing  blame.  Virtue signaling.  Denial.  No invitations to self examination, no calls for reducing consumption here in North America.  No concept of the second level effects that would result from "punishing" big oil.  Very little understanding or respect for economic principles or history.  But it sure feels nice to be righteous and to know who is to blame!  Burn the witch!

 

 

 

 

 

 

+1

 

I read "The Madness of Crowds", by Douglas Murray earlier this year, I'll have to read that one too.

[Spekulatius]

1 hour ago, Mephistopheles said:

I met a young self proclaimed “communist” at a bar in NYC last night. He was probably about 25yo. At various parts of the night we spoke about John D Rockefeller and also the Soviet Union. He though the former was evil and that the latter was great.
 

It was mind numbing listening to this kid who has figured out the world at such a young age. There was no convincing this guy of reality.
 

But we wouldn’t be where we are if people weren’t so stupid. So am thankful for ESG and all the lunatics associated with it.

LOL, my son know a few fellow high school students who are in the "Socialist club" as well as a self proclaimed communists.

 

I think these kids think it's cool to be a communist. Most of these kids drive nice cars and live a sheltered life. I think they just like being contra conventional wisdom. None of them would last in a true communist society much less enjoy it.

[lnofeisone]

I've heard about simulated kidnappings - where you pay someone to kidnap you. I wonder if we could have simulated communism. You know, put them into one of those east European-style communist 5 stories buildings, cut off water and electricity. Have them commit to how many days they want to spend in that heaven and don't let them out until the time is up. Winners get a one-way ticket to North Korea. I jest of course. I think Spek is right on. I had a friend in high school was an "anarchist" and didn't believe in Gov't and today he is a Gov't consultant. I think being contra is the popular thing, especially when few people know much about one's position.

[SharperDingaan]

Aaaah, everybody needs an anarchist. For most it's just a fashion statement, and a schtick by which to get laid; spend all your time in either a nice warm coffee shop, a bar, or a bed!!. Almost always the anarchist is a lot smarter than he/she portrays, and is often a trust fund kid; but isn't really going to make a difference in the world. Harmless.

 

Then you get the twisted bastards .... and either a Baader-Meinhof gang, or a Satoshi Nakamoto is born!

Be careful what you wish for 

 

SD

  

Edited November 12, 2022 by SharperDingaan

[Castanza]

On 11/3/2022 at 2:53 PM, Pelagic said:

 

This article really went off the rails toward the end lol

 

Let's say the most likely scenario next week is Reps win the house and senate is split 50/50. That doesn't exactly strike me as a drill baby drill outcome. Even a Rep majority in the senate likely doesn't benefit oil companies as much as the author hopes.

 

 

Shapiro won the go race here in PA. Pretty big on increasing regulation and reducing the land that is allowed to be drilled. Guess we will see, energy can do well under both parties no? We saw the gas boom under Obama. Maybe that was just luck of timing and technology.