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Hey Oil Barons.......


936horn

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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.

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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.

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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!

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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.

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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.

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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 by Storm the Field
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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.

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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.

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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.

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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.  

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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.

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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.
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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

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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.

 
 

 

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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!

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