I wish they would sell their REDA pump business so maybe the new owner could make it worth a damn.

texpert68 said:

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I wish they would sell their REDA pump business so maybe the new owner could make it worth a damn.

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Lol

cajunaggie08 said:

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Comeby! said:

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JTA1029 said:

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txaggie02 said:

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This is a big one!
https://finance.yahoo.com/news/schlumberger-contribute-north-american-pressure-105000195.html

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Very exciting stuff!

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Is this the final bow out of North America? If I'm not mistaken, their frac division had the highest margins of their product lines. Or at least that was the case before the shale game when I worked there.

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It would appear so. Why own a product line where you have no customers for the foreseeable future. They couldnt even get cash for it. Its just stock in Liberty. However i realize no one has the cash to offer now. Should business ever pick back up, it wouldnt be hard for SLB to get the extra 14% of stock required to have controlling interest in Liberty and then the product line is back in their blue pockets.

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They are prohibited from purchasing additional shares.

Speaking of SLB, they have sold the former LeTourneau campus which has has been a Cameron facility for awhile. This is the building across from the hot dog shop.

https://www.bizjournals.com/houston/news/2020/09/01/adkisson-development-acquires-manufacturing-campus.html?ana=e_ae_prem&j=90526480&t=Afternoon&mkt_tok=eyJpIjoiTURVMlltRmpOVGRpTURBMiIsInQiOiI3RXJtWk1hZFkrTnNhajRYYzBub1c0VjdxekxPMEljOU8wcDI0QVpwdjZRYlwvY053bWlkd3Zza3lxQ1IrYkNqNmVMUXVNWjdWbHZ1RFpaVGZBYm8rVU84eHNlRUF0TlVUNTA3bXk0OFRibnBHS0Z0Q0hRN0J3SE1BM1BVRllHbkNFYnNLSXNZcVBsYUY1MkQ0Sm9iQVd3PT0ifQ%3D%3D

Good post. This further illustrates how producers and midstream companies are deadlocked. But something has to give.....

Very well said

Bingo, you explained it much better than myself. Something has to give.

Amazing that we can see a 9.0+ MM bbls draw on EIA data and prices still move downward.

Goes to show the catalyst for oil price movement will be the end of Covid or an effective vaccine / treatment.

AustinAg008 said:

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Amazing that we can see a 9.0+ MM bbls draw on EIA data and prices still move downward.

Goes to show the catalyst for oil price movement will be the end of Covid or an effective vaccine / treatment.

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I mean I'm not optimistic because I know OPEC has a ton of excess capacity until demand recovers. I think we're still in a chaotic period for inventories and ultimately, the only way I see upward movement in oil price is an imbalance in already drilled and completed supply and demand. Theoretically we're a long way off. Also you have a lot of companies picking up frac crews right now to start completing their DUCs. I expect the US supply curve to change slope at least.

AustinAg008 said:

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Amazing that we can see a 9.0+ MM bbls draw on EIA data and prices still move downward.

Goes to show the catalyst for oil price movement will be the end of Covid or an effective vaccine / treatment.

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add in Imperial shutting its Kearl oil sands over a pipeline leak. another 220K BOPD offline. prices down. energy stonks down.

wow.

credible source?

Furlock Bones said:

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credible source?

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He's an I/E manager in south texas, I dont see any reason for him to make this up. Could be hearsay. Will ask him for an update later.

thepartygoat said:

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Just got this text from my buddy who works at Energy Transfer:

"You know how DAPL (dakota access pipeline) is currently under review, there was an IED found strapped to one of our lines under construction in central texas. Also hearing there was one found on kinder morgans permian line as well"

crazy times.

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DAPL goes through central Texas?

I have mentioned this before regarding pipeline protesters ... they are incredible.


On DAPL - I had a crew working for months after the line was finished doing repairs. All on valve settings where you would find hammer marks and attempted holes from hand drills.



There is a lot of misguided hate out there. I do have a problem seeing an true IED, but i do not have any problem seeing other vandalism.

evestor1 said:

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I have mentioned this before regarding pipeline protesters ... they are incredible.


On DAPL - I had a crew working for months after the line was finished doing repairs. All on valve settings where you would find hammer marks and attempted holes from hand drills.



There is a lot of misguided hate out there. I do have a problem seeing an true IED, but i do not have any problem seeing other vandalism.

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Clarify?

Believe he was saying he could definitely see it as a possibility (or so I hope). Not that he doesn't have any personal issue with vandalism.

The militant environmentalists are out of control. Didn't know midstream was literally dealing with bombs, didn't expect they were that insane.

SpreadsheetAg said:

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thepartygoat said:

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Just got this text from my buddy who works at Energy Transfer:

"You know how DAPL (dakota access pipeline) is currently under review, there was an IED found strapped to one of our lines under construction in central texas. Also hearing there was one found on kinder morgans permian line as well"

crazy times.

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WTF

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Wife said she saw on the news the other day that an explosive device was found "near a pipeline in Bastrop". She said the news was insistent the device was not found in the pipeline, like that would 1) matter, 2) be something enviro terrorists could do.

Crazy times.

Ulrich said:

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Problem is midstream builds out the system/takeaway up front, the money is already out the door and the debt is on the balance sheet.

The E&P cuts capital spending, so the volumes aren't there and they want relief on the MVC... but midstream already put all their money in the ground and the MVC is what keeps the project from losing money. Payback periods are several years long at AFE volumes (obviously higher than the MVC), so the E&P is trying to reneg before midstream has made its money back, let alone serviced the debt and achieved a return.

Meanwhile the midstream investors are demanding steady cash flow based on signed contracts, so telling them that you had to give ground on your MVC kills subscription on future issuances and reduces confidence in the management team. That makes it a lot harder to roll all the debt you took on to build out the infrastructure in the first place. Debt you wouldn't have been willing to take on without the MVC.

We've talked about the pathologies/influences that result in unrealistic project economics, so I don't want to belabor that point. But midstream is not sitting on an inexhaustible fountain of cash and insisting on compliance with the contract for giggles. Investors want midstream to bring leverage down an average of two turns, and that means cutting capital investment and squeezing every dime out of existing assets.

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2 things I would add on this:

1) Midstream investors definitely invest in Midstream for durable, fee-based cash flows. However, Investors are very aware of MVC structure / contract length. Many of the oil pipelines put into service in the 2012 - 2015 time frame have contract cliffs on the horizon in the next few years, and those MVCs were done at much different tariff rates than today's environment. It's not crazy to think that investors might not mind seeing a contract renegotiation in the near future if it were to extend the contract length even at a lower tariff. Better to maintain volumes at a lower tariff than completely lose everything once the MVC expires.

2) I would agree that for the last 12 - 18 months, equity investors have been very aligned with debt / fixed income - they wanted Midstreamers to keep lowering leverage. Midstream companies have been slashing capital programs, reducing costs and working towards free cash flow to achieve this. But, there's been a shift recently - while yes equity investors still want leverage lower, many are now wanting cash returns prioritized in the form of buybacks. Capital inflows to energy and midstream specifically have totally dissipated. Institutional investors need something to attract money back to the space and cash returns from stable, fee-based businesses is the prevailing way to do that. For operating companies, it's going to become a balancing act of keeping equity holders happy while also keeping leverage in check.

And all of this doesn't even touch on consolidation, which seems inevitable.

That would make them an anarchist, not an environmentalist.

I'm hearing KM did find an IED on their Permian Highway project. Not hearing anything on ET.

https://oilprice.com/Latest-Energy-News/World-News/Suspicious-Package-Removed-From-Pipeline-Site-In-Texas.html

Engine10 said:

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All this talk of pipelines and sabotage and no Christmas Jones material smh

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No, it wouldn't. Bombing one project doesn't necessarily make them anti-government. It just makes them a wacko.

thepartygoat said:

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Just got this text from my buddy who works at Energy Transfer:

"You know how DAPL (dakota access pipeline) is currently under review, there was an IED found strapped to one of our lines under construction in central texas. Also hearing there was one found on kinder morgans permian line as well"

crazy times.

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These groups are extremely dangerous and I wouldn't put it past them to do something like this. Just look at all the chaos throughout our country. I never thought I'd see the **** that I'm seeing today. I know one of the legal VP's there. I may reach out to see if there is any truth to that, that is if he could say. Talk about a potential public panic.

Engine10 said:

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All this talk of pipelines and sabotage and Christmas Jones material smh

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What a terrible Bond movie

I'm not sure the enviro-wackos can put together a device that would rupture the heavy wall stuff. I've seen a 3/4 ton truck hit a valve setting wth pipe and fittings on each side and it just scuffed up the FBE.