Hey Oil Barons.......

[Armybrat 40,826]

I had forgotten about that. No big deal for us, as it doesn’t affect our lifestyle.

However the oil patch up there is probably worse off for the employees than it is down here. Plus they are stuck in North Dakota.

[DCA_HORN 725]

Not a bad place to be this time of year.

[Storm the Field 5,294]

WTI keeps bouncing around in about a $0.40 range above and below $35.

Looks likely to close at its highest price since tanking from $45 on 3/6 to $31 on 3/8. That was the weekend the brief Saudi/Russia oil war kicked off.

[Neonmoon 38,129]

It’s going to be lower for longer until travel resumes. But the COVID laydown (prod/rig/capex) will come home to roost at some point in the prices 

[Eastwood 4,394]

I did a quick search in my old stomping grounds to see how many drilling permits were issued from March until this last Tuesday. A grand total of four in a very active East Texas County. 3 from late March to mid-April, then 30 days of 0 until 1 on May 22. The one in May wasn't even my old company. Some small company I'd never heard of.

[Eastwood 4,394]

What county?

Burleson

[Cajun 11,705]

11 hours ago, Armybrat said:

Was shocked to actually receive a royalty check (About 10% of the usual amount) from Continental Resources. 
Maybe enough to cover our anniversary dinner on the 10th.

I thought they had shut in those wells (North Dakota Bakken)

I was shocked to have gotten a freaking division order from XTO for 2 new wells down around Campbellton.

Was not expecting that at all.

[Armybrat 40,826]

The utility company in North Dakota’s Montrail county & others announced it would give the oil producers a big reduction in their power rates. Guess that is supposed to encourage them to ramp up reopening the shut in wells.

[Neonmoon 38,129]

Chevron announces 15% layoffs this week. 

[Parliament 14,249]

19 hours ago, Armybrat said:

I had forgotten about that. No big deal for us, as it doesn’t affect our lifestyle.

However the oil patch up there is probably worse off for the employees than it is down here. Plus they are stuck in North Dakota.

Enjoy the balls-hot Texas summer, you hoser!

[tx 3 putt 76,880]

8 hours ago, Neonmoon said:

Chevron announces 15% layoffs this week. 

get rid of all the olds / people just hanging on for a paycheck and deep cuts through staff with less than 3 years. i think they're rolling out salary cuts for everyone else 

[Llano Estacado 1,257]

Chevron announces 15% layoffs this week. 

http:// https://www.reuters.com/article/us-occidental-lawsuit/occidental-is-sued-by-shareholders-bondholders-over-anadarko-merger-idUSKBN2332WY

$1B break-up fee from Oxy doesn’t go far in 2020 apparently. You’d think CVX could move that towards G&A.

[Neonmoon 38,129]

Companies are preparing for an extended period of lower prices. Most have already done the Capex cut. One of the next easiest levers is SG&A. My company will have layoffs this year. I hope I make it through 

[Okie State 3,816]

http:// https://www.reuters.com/article/us-occidental-lawsuit/occidental-is-sued-by-shareholders-bondholders-over-anadarko-merger-idUSKBN2332WY

$1B break-up fee from Oxy doesn’t go far in 2020 apparently. You’d think CVX could move that towards G&A.

Redirected to Executive compensation.

[Neonmoon 38,129]

Shit, I have no idea what the prices will do. They could easily shoot up to 60 and stay there. I’m always of the opinion no one ever knows. But I’m just saying companies are preparing for the worst prices. Doesn’t mean they will come 

[BTW 370]

Heard over the weekend that Concho had 300+ take the early retirement package they were offering. I think they were shooting for about a 20% workforce reduction, so that should get them pretty close.  I'm thinking some of the subsequent layoffs will be higher up on their org chart in order to have the most financial impact.

[Fudge Nuggets 19,189]

Higher ups don't get laid off.  They depart the company to pursue other interests and are wished well on the future endeavors.

 

[tx 3 putt 76,880]

59 minutes ago, Fudge Nuggets said:

Higher ups don't get laid off.  They depart the company to pursue other interests and are wished well on the future endeavors.

 

With a overly generous comp package 

[52-80 19,147]

I've mostly enjoyed my job, for the entirety of my career.  When we play the 'if you won the lotto tomorrow' hypothetical, I always figured I'd still continue my day job for atleast a little while, to maintain some routine and discipline...

 

...until this month when we practiced a 50% reduction in schedule....so I basically WFH 2 days a work....and holy moly it has been fucking nice.

[Storm the Field 5,294]

Nothing earth shattering here, but looks like supply and demand should pass equilibrium this month and then we begin the long slow process of drawing down the overhang. 

 

 

[Storm the Field 5,294]

Only chumps try to make money in O&G by producing oil or gas at a profit. The real move is to get an executive title. Then it doesn't matter how shitty your company does. 

For Whiting Petroleum Corp. Chief Executive Officer Brad Holly, filing for bankruptcy had at least one perk: a $900,000 pay raise.

Across the oil industry, leaders of failing companies are hitting the jackpot even in the aftermath of Covid-19 lockdowns that destroyed energy demand, crushed prices and threw almost 100,000 rank-and-file employees out of work.

Some 35 executives at Whiting, Chesapeake Energy Corp. and Diamond Offshore Drilling Inc. stand to share almost $50 million in payouts as their companies careen toward -- or have already embraced -- bankruptcy protection. California Resources Corp. warned investors last last month that there’s “substantial doubt” it will stay afloat. Nonetheless, executives were guaranteed their 2020 bonuses.

Corporate directors defend the multimillion-dollar paydays as vital to preventing a scramble for the exits and retaining management teams with deep knowledge of the company’s assets.

“It’s this bizarre world where the CEOs drove the company into bankruptcy, but it’s important that the company pays them bonuses because they’re the only ones who can get them out of bankruptcy,” said Kelly Mitchell, an analyst for Documented, a corporate watchdog group.

 

“For some executives it’s resulted in massive payouts, far and above what they would have ever received if the company hadn’t filed for bankruptcy,” she said.

To bank these top-dollar payouts, the trick has been for board compensation committees to compare their company’s performance to other energy companies, rather than the wider market, according to Terreson. That narrowing of the field can mean management teams achieve their bonus targets even if investors incurred losses.

“CEO pay can remain high as long as management teams destroy less value than peers,” Terreson wrote in a note to clients.

Edited June 4, 2020 by Storm the Field

[Fudge Nuggets 19,189]

54 minutes ago, Dr. Beeper said:

2a, 2b, 1, x, x, x (maybe but I suspect royalties are gonna slump with slowdown, at least in interim) and x. What did you own Whiting and CHK before?  Christ dude. 

And since his post the actual results are 2, 4, 5a, 1, 5b, 3

[Fudge Nuggets 19,189]

9 hours ago, Storm the Field said:

Only chumps try to make money in O&G by producing oil or gas at a profit. The real move is to get an executive title. Then it doesn't matter how shitty your company does. 

For Whiting Petroleum Corp. Chief Executive Officer Brad Holly, filing for bankruptcy had at least one perk: a $900,000 pay raise.

Across the oil industry, leaders of failing companies are hitting the jackpot even in the aftermath of Covid-19 lockdowns that destroyed energy demand, crushed prices and threw almost 100,000 rank-and-file employees out of work.

Some 35 executives at Whiting, Chesapeake Energy Corp. and Diamond Offshore Drilling Inc. stand to share almost $50 million in payouts as their companies careen toward -- or have already embraced -- bankruptcy protection. California Resources Corp. warned investors last last month that there’s “substantial doubt” it will stay afloat. Nonetheless, executives were guaranteed their 2020 bonuses.

Corporate directors defend the multimillion-dollar paydays as vital to preventing a scramble for the exits and retaining management teams with deep knowledge of the company’s assets.

“It’s this bizarre world where the CEOs drove the company into bankruptcy, but it’s important that the company pays them bonuses because they’re the only ones who can get them out of bankruptcy,” said Kelly Mitchell, an analyst for Documented, a corporate watchdog group.

 

“For some executives it’s resulted in massive payouts, far and above what they would have ever received if the company hadn’t filed for bankruptcy,” she said.

To bank these top-dollar payouts, the trick has been for board compensation committees to compare their company’s performance to other energy companies, rather than the wider market, according to Terreson. That narrowing of the field can mean management teams achieve their bonus targets even if investors incurred losses.

“CEO pay can remain high as long as management teams destroy less value than peers,” Terreson wrote in a note to clients.

The OXY queen bitch got re-elected by a landslide, so the gravy train will continue, and she's destroyed more value than anyone in the industry.

[Fudge Nuggets 19,189]

21 minutes ago, Dr. Beeper said:

 

Ha I thought that was a recent post. I thought that was the last page, but guess I was replying to one from first page?

Amazing that XOM has performed as poorly as OXY. 

Nah, that's just the difference between a trade and an investment.  XOM paid out a full dividend in that time and OXY cut theirs to jack shit.  Long-term, XOM will kick their ass and might own them.

[Fudge Nuggets 19,189]

18 minutes ago, Dr. Beeper said:

@Trey3216@ryskeyHow y’all feel about crude and the sentiment from Sheffield and others that production is already coming back?  I have other guys telling me they’re convinced we’ll be at $55-$60 by year end. 

I ask because I’m about to buy some properties. Supposed to close Tuesday.  I think it’ll be pushed to June 15 or even July 1. I have zero idea what the fuck to do with hedges. 

I might buy a put for rest of year. This vexes me. I’m terribly vexed. 

Hedging is for losers.  You bought the properties because you are confident oil is going up.  Why do you want to cap your gains?

I'm only half joking.

[ryskey 447]

12 hours ago, Dr. Beeper said:

@Trey3216@ryskeyHow y’all feel about crude and the sentiment from Sheffield and others that production is already coming back?  I have other guys telling me they’re convinced we’ll be at $55-$60 by year end. 

I ask because I’m about to buy some properties. Supposed to close Tuesday.  I think it’ll be pushed to June 15 or even July 1. I have zero idea what the fuck to do with hedges. 

I might buy a put for rest of year. This vexes me. I’m terribly vexed. 

$40 WTI feels very overbought, but so does everything else I guess.  Way too much uncertainty around product demand, refinery runs, and producers bringing back production.  I am hedging some here if that helps.  This bull market in everything has to correct at some point.  

Costless collars or 3-ways wouldn't be bad right now.  Costless looks like $30/$48 right now for '21.  And people have pooped on 3-ways after the crash but putting them on at these prices isn't a bad idea.  I just stay away from them out of principle though.  

[Eastwood 4,394]

I think we have a chance to go higher. We may have gone negative and popped back up in record time, but rigs are still stacked and I haven't gotten any phone calls. Compared to the end of 2015, early 2016, I was getting phone calls asking to fire back up 3 months after we bottomed out in the 20s. In 2012 (I think) when it dropped all the way down to $80 (the horror!) in the second big dip after 2010, I was getting phone calls the next week. Land is the first thing to fire up, so the phone calls asking about availability, for me at least, were the indicator that projects were ready to run.

[Storm the Field 5,294]

$0.50 away from $40, exactly 3 months to the day that WTI started its free-fall down from $40. 

Rig count down another 17 this week to 284. 12th straight weekly decline and 5 straight week setting a new record low.

[Fudge Nuggets 19,189]

Yesterday $OXY filed an 8-K outlining a Change of Control severance plan for their executives.  Today the stock is up 30%.

Yeah, looks like someone is about to buy them out.  Unreal that bitch is going to make out like a thief after all the destruction she caused.

[Dbeasy 15,042]

Only chumps try to make money in O&G by producing oil or gas at a profit. The real move is to get an executive title. Then it doesn't matter how shitty your company does. 

For Whiting Petroleum Corp. Chief Executive Officer Brad Holly, filing for bankruptcy had at least one perk: a $900,000 pay raise.

Across the oil industry, leaders of failing companies are hitting the jackpot even in the aftermath of Covid-19 lockdowns that destroyed energy demand, crushed prices and threw almost 100,000 rank-and-file employees out of work.

Some 35 executives at Whiting, Chesapeake Energy Corp. and Diamond Offshore Drilling Inc. stand to share almost $50 million in payouts as their companies careen toward -- or have already embraced -- bankruptcy protection. California Resources Corp. warned investors last last month that there’s “substantial doubt” it will stay afloat. Nonetheless, executives were guaranteed their 2020 bonuses.

Corporate directors defend the multimillion-dollar paydays as vital to preventing a scramble for the exits and retaining management teams with deep knowledge of the company’s assets.

“It’s this bizarre world where the CEOs drove the company into bankruptcy, but it’s important that the company pays them bonuses because they’re the only ones who can get them out of bankruptcy,” said Kelly Mitchell, an analyst for Documented, a corporate watchdog group.   “For some executives it’s resulted in massive payouts, far and above what they would have ever received if the company hadn’t filed for bankruptcy,” she said.

To bank these top-dollar payouts, the trick has been for board compensation committees to compare their company’s performance to other energy companies, rather than the wider market, according to Terreson. That narrowing of the field can mean management teams achieve their bonus targets even if investors incurred losses.

“CEO pay can remain high as long as management teams destroy less value than peers,” Terreson wrote in a note to clients.

This isn’t just an oil and gas problem. This is a problem throughout America. Top executives are stealing billions of dollars.

[tequila 317]

Doc,
Any chance you can find someone to underwrite deferred premium puts? In my experience, there’s not much of a premium on the credit, and it significantly changes the math you lined out above.


Sent from my iPad using Tapatalk

[52-80 19,147]

I lolled at "retaining Management's deep knowledge of assets"

[Fudge Nuggets 19,189]

On 6/4/2020 at 9:18 PM, Dr. Beeper said:

The streets are littered, though, with “losers” that didn’t hedge at $60. 

Any company after 2015 that required $60 oil to survive had a shit poor business plan and deserved to go bust.

[Cajun 11,705]

Troof

[Neonmoon 38,129]

6 hours ago, 52-80 said:

I lolled at "retaining Management's deep knowledge of assets"

Isn’t this the fucking truth. 

[TexanTraveling 42]

anybody have thoughts or opinions on the future of Sanchez Energy?

[tx 3 putt 76,880]

7 hours ago, 52-80 said:

I lolled at "retaining Management's deep knowledge of assets"

There’s a younger, smarter, better, cheaper replacement for anyone at every company. From the ceo down 

[Fudge Nuggets 19,189]

I can be good, cheap and fast.  Pick two.

[Eastwood 4,394]

Look at CHK this morning. Another short squeeze?

[Cajun 11,705]

Holy shit.  That was the pop I was waiting for just to take aboiut 10% of the "sting" away.

Glad I saw your post.

[DCA_HORN 725]

anybody have thoughts or opinions on the future of Sanchez Energy?

Besides run away?

[Cajun 11,705]

Only thought I have is that they should add "Dirty" to their name.

That's all I got.

[DCA_HORN 725]

BP laying off 10k.

[Neonmoon 38,129]

51 minutes ago, DCA_HORN said:

BP laying off 10k.

That seems like a big number. 

[DCA_HORN 725]

That seems like a big number. 

Worldwide

[Eastwood 4,394]

Holy got damn short squeeze, CHK

[Trey3216 15,345]

11 minutes ago, Eastwood said:

Holy got damn short squeeze, CHK

and Val, and CPE, and FTK, and a host of others 

[Lobwedgephil 1,139]

22 minutes ago, Eastwood said:

Holy got damn short squeeze, CHK

Crazy. 

 

Shares of Chesapeake Energy Corp. CHK, +140.40% nearly tripled in active trading, and have soared more than 5-fold in two days (up 421%), as an agreement by major oil producing nations over the weekend to extend production cuts and recent better-than-expected economic data helped fuel optimism over continued gains in crude oil prices. Trading volume was 8.3 million shares, already more than triple the full-day average of 2.6 million shares. The oil and gas company's stock shot up 195% in midday trading, which would be a one-day record gain by far, a day after soaring 76.5% on Friday. The previous record one-day gain was 96.0% on March 13. The stock has now rocketed more than 8-fold since closing at a record low of $8.71 on May 14, and 350% since April 15, when a 1-for-200 reverse stock went into effect. The company has not responded to a request for comment. The surprisingly strong May jobs report out Friday boosted hopes for a quicker-than-expected return in demand, while the agreement by OPEC and allied nations over the weekend to extend production cuts helped assuage concerns over a supply glut. The SPDR Energy Select Sector ETF XLE, +2.98%,which rose 2.7% on Monday, and the Dow Jones Industrial Average DJIA, +0.82%, which climbed 223 points, or 0.8%, on the day, were both headed for a sixth-straight gain. Crude oil futures CL00, -3.43% fell 3.5% Monday, but have nearly doubled (up 99%) since the end of April.

 

 

 

[Cajun 11,705]

2 hours ago, Lobwedgephil said:

Crazy. 

 

Shares of Chesapeake Energy Corp. CHK, +140.40% nearly tripled in active trading, and have soared more than 5-fold in two days (up 421%), as an agreement by major oil producing nations over the weekend to extend production cuts and recent better-than-expected economic data helped fuel optimism over continued gains in crude oil prices. Trading volume was 8.3 million shares, already more than triple the full-day average of 2.6 million shares. The oil and gas company's stock shot up 195% in midday trading, which would be a one-day record gain by far, a day after soaring 76.5% on Friday. The previous record one-day gain was 96.0% on March 13. The stock has now rocketed more than 8-fold since closing at a record low of $8.71 on May 14, and 350% since April 15, when a 1-for-200 reverse stock went into effect. The company has not responded to a request for comment. The surprisingly strong May jobs report out Friday boosted hopes for a quicker-than-expected return in demand, while the agreement by OPEC and allied nations over the weekend to extend production cuts helped assuage concerns over a supply glut. The SPDR Energy Select Sector ETF XLE, +2.98%,which rose 2.7% on Monday, and the Dow Jones Industrial Average DJIA, +0.82%, which climbed 223 points, or 0.8%, on the day, were both headed for a sixth-straight gain. Crude oil futures CL00, -3.43% fell 3.5% Monday, but have nearly doubled (up 99%) since the end of April.

 

 

 

I was about to dump my CHK last week, but got distracted with being in the middle of a move and forgot.

Thank fucking GAWD!

I mean, I'm still way in the mf'ing red, but this Viagra moment sure has taken a shitload of the sting out.  Dayum!

[Fudge Nuggets 19,189]

2 hours ago, Trey3216 said:

and Val, and CPE, and FTK, and a host of others 

I rode the FTK train from 1.04 to 1.55 since Thursday.  That was a hell of a run.