Yesterday, the S&P 500 moved into bull market territory (+20.04%) from its lows in October, with (or rather because) most big banks – Goldman, JPMorgan, Morgan Stanley – still extremely bearish (because their flow desks are accumulating everything their institutional clients have to sell).

But one thing is certain: as DB’s Jim Reid notes, It couldn’t have done it without the AI hype as over this period the NYFANG+ index is up +65.6% and up +79.7% from its November lows seen close to the launch of ChatGPT at the end of that month.

Six months after its viral launch, ChatGPT has now reached a fresh milestone: according to Reid, a staggering half of people in the US and the major European markets now saying they’ve heard of OpenAI’s chatbot, indicating that the future of generative alternative intelligence may be as much in the hands of consumers as in companies.

The DB strategists notes that 52% of the respondents in the bank’s exclusive Digital Infrastructure Group (dbDIG) survey of 10,000 global households said they were aware of ChatGPT in May, up from 38% just two months earlier.

Interestingly, at the moment students…

… and higher income groups seem to have some of the highest usage.

There is also some evidence from the survey that lower income groups have used it more than those of middle income.

Clearly it’s too early to make sweeping conclusions but there is some evidence that the former group could be a big beneficiary relative to those in the middle.

You can find out more on the survey from Adrian Cox’s report “End of the essay crisis as students embrace ChatGPT: dbDIG survey” (available to pro subscribers here).

Red concludes with a rhetorical question: “if 50% of global  if 50% of global households have now heard of it, where will AI-related stock prices be when 100% have?”

Authored by Kyle Anzalone via AntiWar.com,

The Department of Defense announced on Friday it will purchase $2.1 billion in weapons for Ukraine, including munitions for Patriot and Hawk air defense systems.

The weapons to be purchased include:

• Additional munitions for Patriot air defense systems;
• HAWK air defense systems and missiles;
• 105mm and 203mm artillery rounds;
• Puma Unmanned Aerial Systems;
• Laser-guided rocket system munitions;
• Support for training, maintenance, and sustainment activities.

The weapons are being purchased for Kiev under the Ukraine Security Assistance Initiative (USAI). The Joe Biden administration has primarily relied on the Presidential Drawdown Authority (PDA) to ship arms directly from US stockpiles to Ukraine. Weapons provided under the USAI could take months or years to deliver as they involve contracts and might need to be manufactured.

“This announcement represents the beginning of a contracting process to provide additional priority capabilities to Ukraine,” the Pentagon press release said. “This USAI package illustrates the continued commitment to both Ukraine’s critical near-term capabilities as well as the enduring capacity of Ukraine’s Armed Forces to defend its territory and deter Russian aggression over the long term.”

A Pentagon fact sheet claims the US has now committed to Ukraine $39.7 billion in security assistance alone. However, a February report published by the Kiel Institute said American military aid had already topped $45 billion.

Congress authorized the White House to spend $18 billion through the USAI in FY 2023. The Pentagon has announced $10.8 billion in arms purchases using the USAI this year.

A conflict of interest looming over purchasing the weapons in this package is that Secretary of Defense Lloyd Austin previously worked with Raytheon. The arms industry giant manufactures the Patriot interceptors the Pentagon plans to buy. 60 Minutes recently interviewed a former Pentagon contract negotiator, Shay Assad, who warned companies were exploiting the war in Ukraine by “price gouging” the US government.

Assad pointed to Raytheon making a 40 percent profit on Patriot munitions. The company also lied about the cost and time involved in building radar equipment to build the Patriot system, according to the former Department of Defense employee.

Authored by Victoria Taft via PJ Media,

A leaked video shows that at least one Washington, D.C., cop – and likely more – acted on January 6 as apparent agent provocateurs, dressing as protesters, scaling scaffolding outside the Capitol Building, and urging protesters toward the iconic building. See the video below.

Congressman Barry Loudermilk (R-Ga.) says the authenticated GoPro video raises the question of why police officers, who were identified as intelligence officers, were working to stir up the crowd of protesters instead of working to stop an assault on the Capitol.

At one point in the video, the unidentified police officer equipped with the camera said to another he thought the idea was to get people inside the Capitol Building and trap them inside. The observation by the undercover officer leads one to conclude that there was intelligence about a plan to attack the Capitol and the apparent response by the police was to let them do it and take pictures.

When another alleged officer on the video saw people climbing the scaffolding, he told the officer with the GoPro, “That’s dangerous. Somebody’s going to get shot.” A third alleged officer said, “They’re not going to shoot anybody.” Yet, they encouraged and participated in the dangerous activity.

As the group of officers worked their way through the crowd and to the scaffolding, they joined in with the protesters’ chants, “Whose house? Our house!”

Loudermilk told the “Just the News, No Noise TV” show, “We know that it is one of their officers and at one point he is encouraging, and it appears he’s encouraging. He’s definitely helping people climb the scaffolding, and he’s telling them ‘go, go, go.’”

Naturally, the congressman wondered, “Why is an officer encouraging people to climb the scaffolding and go into the Capitol?” Further, he asked, “Why did the MPD Metropolitan Police support department decide to put undercover officers in the crowd? Was there intelligence that they had that was or was not passed on to the Capitol Police, and what did the Capitol police do with that evidence, if they got it?”

The Capitol Police were offered National Guard help by the Trump administration, which had been disturbed by intelligence reports of possible trouble. Those in charge of the Capitol Police, including former Speaker Nancy Pelosi and D.C. Mayor Muriel Bowser, turned down the request for a military presence. The outside of the Capitol Building was not hardened, and the numbers of Capitol Police were not plussed-up to deny entry.

Just the News reported that a recent January 6 court case involving William and Michael Pope revealed the existence of the video. A defendant wanted a copy of the video, and federal prosecutors were concerned about it being out of their control, according to a court document  describing its contents:

The specific footage, GoPro video recorded by an MPD Police Officer who was stationed at the Capitol in an evidence-gathering capacity, captures the officer shouting words to the effect of “Go! Go! Go!” (MPD-005-000035 at time stamp 2:37), “Go! Go! Go!” (MPD-005-000035 at time stamp 7:23), and “Keeping going! Keep going!” (MPD-005-000035 at time stamp 8:16) apparently to the individuals in front of him on the balustrade of the U.S. Capitol’s northwest staircase around 2:15 p.m. At other times in these videos, the officer and the two other plain clothes officers with him appear to join the crowd around them in various chants, to include “drain the swamp,” “U.S.A.! U.S.A.! U.S.A.!”, and “whose house? Our house!”

Among the other ironies seen in this video is the warning to the officers by a person identified as a protester to be careful because Antifa provocateurs were among the crowd.

Though Antifa types were seen in the crowd and on video following the January 6 riot, media, cops, and eventually the embarrassing January 6 Committee tried to tamp down any talk about the Leftist mob playing any kind of role. Truth is, if Antifa hadn’t been there, it might have been a first, considering that a violent left-wing mob and their allies in BLM closed roads, rioted, and set the historical “President’s Church” on fire only months before in D.C.

Federal prosecutors argued that the video wasn’t germane to the Popes’ cases. They fretted that “while the videos are not relevant in this case, it is possible that the videos may be relevant in another case—either for the prosecution or for the defense.” They further argued, “Allowing these videos to be utilized in the manner in which the defendant now seeks may jeopardize the rights and safety of others who have been or may later be charged for their conduct on that day.” Try not to laugh.

The American people have the right to know if their police, institutions, and politicians are leveling with them about January 6. This video and the effort to keep it from the public sure seem shady. They expect us to trust them. Sadly, after watching these charlatans on the executive floors of the FBI and DOJ, it’s clear we can’t trust these people anymore.

The congressman has sent a letter to law enforcement asking for more information about police in the J6 crowd on that day in 2021.

Just two days after the Financial Times published a lengthy #MeToo style hit-piece on billionaire hedge fund manager Crispin Odey, the eponymously named Odey Asset Management has removed its founder Odey from the firm’s partnership, according to the FT and Bloomberg. 

“Mr Crispin Odey is leaving the partnership. As from today, he will no longer have any economic or personal involvement in the partnership,” Peter Martin, chief executive, and Michael Ede, chief financial and operating officer, wrote in a statement seen by the FT on Saturday.

They added that Odey Asset Management Group Limited, a holding company that is part of the group and majority owned by Odey, would also be removed as a member and that the partnership would now be owned and controlled by remaining partners.

Odey Asset Management – which we assume will now be renamed unless it is liquidated – also confirmed it “has been investigating allegations concerning Mr Odey” but said it could not comment in detail for confidentiality reasons. It said that “further communications” with clients would follow over the weekend. Reached by phone at lunchtime on Saturday, Odey confirmed he had been notified of the firm’s decision but suggested he would fight it. “You have to have [a] willing buyer, willing seller,” he said. He did not provide additional comment.

A former partner said of Odey told the FT that “The emperor now has no clothes and is losing his powers. It’s very nice not to be there anymore. They had to get rid of him. He’s clearly got to go. In the end the boss got shoved because he went too far.”

Odey, 64, has denied FT’s report that cites thirteen women “who have worked for Odey Asset Management or had social or professional dealings with Odey” and who claim that the billionaire hedge fund manager “abused or harassed them; eight alleged he sexually assaulted them.”

A law firm representing Odey had previously said allegations made against him were “strenuously disputed”. Odey said this week that “none of the allegations have been stood up in a courtroom or an investigation”.

The allegations were the latest in a series the asset manager has faced in recent years. In 2021, he was acquitted of assault charges in British courts, but new accusations against him surfaced soon after, with two women coming forward to Bloomberg News and another to the Times of London newspaper. Later, more appeared in a Tortoise Media podcast.

After FT published the hit-piece, Odey Asset Management instantly saw its prime-brokerage relationship with Morgan Stanley severed while JPMorgan and Goldman reviewed their relationship with the hedge fund. Some investors also pulled their money out, even though the firm has sought to reassure them. In a letter to investors seen by Bloomberg News, Chief Executive Officer Peter Martin said Odey Asset Management is in “active discussions with all service providers and we are confident that our service providers will continue to work with us to ensure that the interests of investors are protected.”

“Their rush to judgment looked like wanton virtue signaling, yet was also an acknowledgment they knew Crispin was already on two strikes,” Adrian Flook, a former member of Parliament in the UK and a private investor into Odey and its affiliate Brook Asset Management funds.

“Wealth and fame can distort a person’s perception of right and wrong,” said Don Steinbrugge, head of Agecroft Partners, which helps hedge funds raise money. “I hope the allegations are wrong, but the evidence is looking very bad for Crispin.”

Born into a well-known family — Odey’s grandfather was a Tory MP and his mother came from an old-line mercantile family — the University of Oxford alumnus started his firm in 1991. In recent years, he’s been tabloid fodder for everything from his support of Brexit to his conspicuous lifestyle. He’s sparked outrage shorting the pound. He’s been mocked for his predictions of doom in the midst of the longest bull market in history.

Most of his investors had already deserted him following his hedge fund’s wild swings between outsized gains and stark losses. Last year marked his best on record, a remarkable turnaround from years of losses.

His roller coaster ride has led to assets in his flagship hedge fund slumping to about $310 million at the end of April from $1.8 billion in assets at its peak in 2015. Assets at the whole firm have also slumped to about $3 billion from more than $13 billion at its height. The majority of the firm’s assets are managed by portfolio managers including James Hanbury and Oliver Kelton.

The company’s move “makes a lot of sense given how heavy the allegations are that Crispin Odey is facing,” said Berlin-based Harald Berlinicke, the owner and chief investment officer of Max-Berlinicke-Erben family office. “It hopefully gives the other portfolio managers such as James Hanbury a good chance to move to business as usual.”

Authored by Savannah Hulsey Pointer and Samantha Flom via The Epoch Times (emphasis ours),

The Biden administration unveiled a series of measures on June 8 to address the rights of the LGBTQ community, including taking action on book bans by appointing a coordinator to work with schools.

The as-yet-unnamed Education Department coordinator will work to inform school districts that prohibiting books could violate federal law, among other issues.

“The Department of Education’s Office for Civil Rights is announcing that to support its ongoing work to defend the rights of LGBTQI+ students and other underserved communities, it will appoint a new coordinator to address the growing threat that book bans pose for the civil rights of students,” the White House said in the announcement.

“That coordinator will work to provide new trainings for schools nationwide on how book bans that target specific communities and create a hostile school environment may violate federal civil rights laws.”

Your daily reminder that when they accuse us of “banning books” they’re referring to pornographic books which are offered to kids in schools across the country.

For some reason CBS didn’t provide examples with pictures… 🤔

So here’s a glimpse: https://t.co/vAFzigs2Qc pic.twitter.com/LTBgn2ERrE

— Libs of TikTok (@libsoftiktok) April 23, 2023

The announcement is part of the administration’s efforts to observe Pride Month and address the concerns surrounding LGBTQ rights. The administration is also unveiling plans to support mental health resources for those in the LGBTQ community and combat violence against the same groups.

The administration has expressed specific concern over book bans, particularly those targeting books that feature LGBTQ communities, communities of color, and other groups.

“Book banning erodes our democracy, removes vital resources for student learning, and can contribute to the stigma and isolation that LGBTQI+ people and other communities face,” the White House said.

Biden’s Comments on the Initiatives

“As president, I was proud to end the band on transgender troops in our military, sign the Respect for Marriage Act, strengthen the civil rights protections for LGBT Americans, and advance LGBT human rights around the globe, but our fight is far far from over,” President Joe Biden said during a June 8 news conference.

He outlined some of the details of his programs that his administration introduced and said they still had plenty of work ahead due to the “hysterical” and “prejudice” people around the country, saying he hoped to find a solution to “violence and hate crimes targeting LGBTQ people.”

“It’s wrong that extreme officials are pushing hateful bills, targeting transgender children, terrifying families and criminalizing doctors,” Biden said. “These are our kids. These are our neighbors. LGBTQ Americans, especially children, you’re loved, you’re heard, and this administration has your back.”

Book Ban Controversy

The issue of book bans has concerned parents and school officials in recent months, with some more politically conservative states like Texas and Florida taking center stage in the debate.

In April of this year, Officials in Llano County, Texas, declined to vote on closing libraries after dozens of books containing sexual and racial content that were previously banned were returned to shelves by order of a federal judge.

The county commissioners voted unanimously to remove the issue from their agenda, keeping the libraries open with the books on the shelves.

Just a month earlier, Florida Gov. Ron DeSantis attacked the “myths” surrounding book bans in his home state, showing a video that included content graphic enough to make some those in attendance at his news conference concerned about repeating what they saw.

“A lot of what’s been going on is an attempt to create a political narrative,” DeSantis said. “And it’s a false political narrative.”

This came about a year after Florida passed their Parental Rights in Education law, banning lessons on sexual topics for children in third grade or younger.

Read more here…

A fresh report in The Wall Street Journal says that the saboteurs who carried out the Nord Stream pipeline attack likely used Poland as an operating base from which to launch the covert op.

“The probe by Germany’s Federal Criminal Police Office is examining why the yacht they believe was used to carry out the operation journeyed into Polish waters,” WSJ wrote in a Saturday investigative report. “Other findings suggest Poland was a hub for the logistics and financing of last September’s undersea sabotage attack that severed the strongest bond tying Berlin to Moscow.”

The new allegations are based on the findings of the German investigation, which Polish authorities have reportedly been seeking and struggling to gain access to. If true, it could escalate already boiling tensions between Warsaw and Moscow, and put Russia further on a war-footing with NATO. 

“German investigators have fully reconstructed the entire two-week long voyage of the Andromeda—the 50-foot white pleasure yacht suspected of being involved in one of the biggest acts of sabotage on the continent since World War II—and pinpointed that it deviated from its target to venture into Polish waters,” WSJ continued.

The WSJ report cites as evidence for the Poland connections that German investigators were able to piece together tracking information from the boat’s satellite and mobile phones, as well as navigation equipment and radio devices, and even Gmail accounts.

Investigators have further been able to determine that the Andromeda had sailed around or near each of the precise locations where the blasts took place in the Baltic Sea, leading them to believe it was involved in the plot. However, other recent investigative reports have cast doubt on the narrative surrounding the Andromeda.

Among the additional more interesting details of the Saturday WSJ report is the official German investigation conclusion that HMX (acronym for High Melting eXplosive), also called Octogen, was used in the underwater demolition. 

Colorless and able to be used underwater, Octogen is according to one industrial chemicals source described as “one of the most powerful series-manufactured blasting explosives.” Further, “It’s applied as a military explosive both individually (in form of different charges) and as a component of explosive compositions.”

A number of recent reports coming surprisingly from within mainstream media have demolished the early narrative from the West that Russia sabotaged its own pipelines.

At the start of this week The Washington Post reported that an unnamed European intelligence service told the CIA that Ukraine’s military was planning an attack on the Nord Stream pipelines a full three months before the September 26, 2022 sabotage blasts which disabled them.

The revelation was based on Pentagon and classified intelligence documents leaked by Air National Guard member Jack Teixeira, or part of the so-called Discord leaks. The intelligence report in question was drafted in June 2022 and shared with the Biden administration, which means the White House has known all along that the “Putin did it” narrative which the West rallied around was false from the start.

“Details about the plan, which have not been previously reported, were collected by a European intelligence service and shared with the CIA in June 2022,” the Tuesday WaPo report said. “They provide some of the most specific evidence to date linking the government of Ukraine to the eventual attack in the Baltic Sea, which U.S. and Western officials have called a brazen and dangerous act of sabotage on Europe’s energy infrastructure.”

Authored by David Stockman via Doug Casey’s InternationalMan.com,

When it comes to capital waste, there is nothing more destructive in all of history than the current disastrous campaign to eliminate CO2 emissions in the name of saving the planet from a phony climate change catastrophe.

Two mindless projects of national impoverishment.

These are embodied in a proposed regulatory dragnet to force 67% of new auto sales into EVs by 2032 and a Washington-funded green energy plan to induce America’s great oil companies to build the equivalent of energy pyramids, likely resulting in corporate hari kari not too far down the road.

Literally, trillions of perfectly good capital stock–such as IC engine autos and coal-fired power plants—will be dismantled well before their useful lives are completed. And this wasted capital stock will be replaced with low and no efficiency interruptible wind and solar electric power and completely asinine schemes like carbon capture from the ambient air that will be heavily subsidized by Uncle Sam.

But to cut to the chase, the carbon capture scheme to which Occidental Petroleum, for example, plans to allocate billions is the equivalent of building 21st century energy pyramids.

CO2 Air Capture Contraption

The Original Egyptian Pyramids

Huge amounts of energy and materials will be used to build and operate these monstrosities, but unlike present day remnants of the Egyptian pyramids, we doubt that some future owners will even be able to charge tourist admission, meaning that the return to society on investment will be somewhere between nichts, nada, nugatory and nothing.

This loony idea apparently stems from the fact that Occidental recently took a stake in Carbon Engineering, a startup backed by Bill Gates, which developed a system to capture, purify and compress CO2. And, oh, Warren Buffett is Oxy’s controlling shareholder, to boot. It’s no wonder this once great American company is being led off the deep-end by these two and its Fortune 100 style woke CEO, Vicki Hollub.

In any event, these contraptions are to sit out by their lonesome in the open expanses of Texas, employing giant fields of fans which pull plain old ambient air into huge containers. Therein massive amounts of energy and chemicals will be deployed to bind with the CO2 to separate it from the air, eventually creating pellets. The pellets will then be heated to release pure carbon dioxide, which, in turn, will be compressed to be transported through pipelines and funneled deep underground.

Naturally, Oxy’s executives have been led to believe that they are doing god’s work, with a big helping hand from Uncle Sam’s lavish subsidies. For instance, Richard Jackson, Occidental’s president of U.S. onshore resources and carbon management, is clearly drinking the cool-aid in big gulps: “We can turn CO2 into value,” he said.

Well, no, they will be doing just the opposite: Turning valuable ambient CO2, on which the plant and animal life of the planet depends, into dead material to be buried deep in the earth, and at enormous waste of economic resources.

Thus, Occidental estimates its initial cost to remove a metric ton of CO2 would be between $400 and $500. It claims that as it manufactures more plants and efficiencies kick in, it will be able to roughly halve that to between $200 and $250 a ton by the end of the decade.

But so what? Waste is waste.

In turn, this deadweight loss to society will be compounded by federal tax credits. The Inflation Reduction Act, signed into law by Sleepy Joe in 2022, rewards companies that capture and store atmospheric CO2 with a $180 tax credit per metric ton contained permanently.

So it’s obvious how Oxy intends to make this pencil out, given that the implied cost of carbon capture amounts to $90 to $180 dollars per barrel of oil equivalent. That is, the taxpayers will fork-over the cost!

But there’s more. In its wisdom Washington will be mandating energy producers, auto producers, airlines, most other businesses, and eventually households, too, to purchase CO2 credits from schemes like Oxy’s carbon capture boondoggle for the privilege of engaging in daily economic life and commerce.

And that is just plain malefic. Oxy will be making money double-charging Americans for the idiocy of carbon capture—first in the tax credits and then in the higher cost of everyday goods and services impacted by the mandates to purchase carbon credits.

Here’s the thing. This sweeping attack on rationality and economic productivity might make sense if Co2 were a super-dangerous pollutant—one which threatened massive medical and economic harm to mankind.

But that is not remotely the case. The campaign against CO2 is a secular religious crusade against what amounts to the soft underbelly of industrial civilization. It’s as if a rampaging sect of misanthropes went looking for the molecule on which the planet’s very life and prosperity depend, found CO2 and declared it as the horrific poison of modern life.

Yet the very science of the matter and the history of the planet reveal the anti-CO2 crusade for what it is – a contemporary form of witchcraftery.

*  *  *

Unfortunately, there’s little any individual can practically do to change the trajectory of this trend in motion. The best you can do is to stay informed so that you can protect yourself in the best way possible, and even profit from the situation. Most people have no idea what really happens when a currency collapses, let alone how to prepare… How will you protect your savings in the event of a currency crisis? This just-released video will show you exactly how. Click here to watch it now.

By Alex Kimani of OilPrice.com

The U.S. shale revolution dramatically reshaped the world energy markets. The shale boom was one of the most impressive growth stories, from take off in 2008 to the Permian stealing the mantle from Saudi Arabia’s Ghawar as the world’s highest producing oilfield in a little over a decade.  Overall, Reuters has estimated that, “U.S. petroleum production is at least 10-11 million bpd higher than it would have been without horizontal drilling and hydraulic fracturing.’’ 

Unfortunately, the shale patch has lately been struggling to ramp up production due to a litany of challenges including pressure from investors to boost returns,  limited equipment and workers as well as a lack of capital.

But shale giant ExxonMobil is now betting that shale producers can double crude output from their existing wells by employing novel fracking technologies.

“There’s just a lot of oil being left in the ground. Fracking’s been around for a really long time, but the science of fracking is not well understood,” Exxon Chief Executive Officer Darren Woods said Thursday at the Bernstein Strategic Decisions conference. Woods has revealed that Exxon is currently working on two specific areas to improve fracking. First off, the company is trying to frack more precisely along the well so that more oil-soaked rock gets drained. It’s also looking for ways to keep the fracked cracks open longer so as to boost the flow of oil. 

Shale Refracs

Luckily, the U.S. Shale Patch won’t have to wait for Exxon to perfect its new fracking technologies. There’s already a proven technology for oil producers to return to existing wells and give them a second, high-pressure blast to increase output for a fraction of the cost of finishing a new well: shale well refracturing. 

Refracturing is an operation designed to restimulate a well after an initial period of production, and can restore well productivity to near original or even higher rates of production as well as extend the productive life of a well. Re-fracking can be something of a booster shot for producers–a quick increase in output for a fraction of the cost of developing a new well.

While refracturing has never really gone mainstream, the technique is seeing higher adoption as drilling technology improves, aging oilfields erode output, and companies try to do more with less. According to a report published in the Journal of Petroleum Technology, new research from the Eagle Ford Shale in south Texas shows that refractured wells using liners are even capable of outperforming new wells despite the latter benefiting from more modern completion designs. 

JPT also estimates that North Dakota’s Bakken Shale straddles some 400 openhole wells capable of generating an excess of $2 billion if refractured. Mind you, that estimate is derived from oil prices at $60/bbl vs. this year’s average oil price of almost $90/bbl. According to Garrett Fowler, chief operating officer for ResFrac, a refrac can be up to 40% cheaper than a new well and double or triple oil flows from aging wells.

How Refracs Work

Fowler says the most common re-frac method involves placing a steel liner inside the original well bore and then blasting holes through the steel casing to access the reservoir. The process typically uses half as much steel and frac sand than a new well

Refrac makes a lot of sense in the current inflationary environment. Back in April, Texas shale producer Callon Petroleum Company (NYSE: CPE) revealed that frac sand, drill pipe and labor costs have increased drilling and well-completion service costs ~20% Y/Y. Callon and Hess Corp. (NYSE: HES), both of which drill in North Dakota’s Bakken shale, have been forced to hike capital spending budgets over the costs with Callon adding $75 million to its original budget while Hess added $200 million to its spending,

“Techniques like re-fracturing will allow the industry to continue to harvest the oil and gas out of these reservoirs,” said Stephen Ingram, a regional vice president at hydraulic fracturing firm Halliburton Company (NYSE: HAL).

Another key benefit: re-fracs do not require additional state permits or new negotiations with landowners. They are also less disruptive to the environment because well sites already have road access.

“Considering inflation, supply chain issues, and rising wages, now is a great time for operators to start looking at wells for re-frac opportunities,” Matt Johnson, CEO of energy consultancy Primary Vision Network, has told Reuters.

Refracs have also demonstrated higher recovery rates: in URTeC 3724057, Roberta Barba, a longtime completions consultant and CEO of Houston-based Integrated Energy Services, et al. share a case study from the Eagle Ford Shale in south Texas involving five refractured wells. The refractured wells had a combined average post-refrac EUR of 13.2% compared to an initial EUR of 7.4% average by seven new infill wells with modern completion designs. 

Robert Barba, a longtime completions consultant and CEO of Houston-based Integrated Energy Services (IES).Estimated ultimate recovery (EUR) refers to potential production expected from an oil well or deposit and is made up of three components: proven reserves; probable reserves; and possible reserves. 

The Authors of the paper say that despite the presumed advantages of a modern completion, refracs can increase stimulated reservoir volume “beyond what is achievable in a new completion”. This is attributed to the fact that as the reservoir depletes and pore pressure drops, fractures from a refrac tend to grow into a new direction and tap previously inaccessible portions of rock.

Niche Market

Despite these seemingly clear benefits, it’s surprising that refrac remains a fringe tech in the U.S. Shale Patch. Norwegian energy consultancy Rystad Energy has estimated that out of all the U.S. horizontal well stimulations performed through September, out of the 8,900 total stimulations from January to September, only 200, or a little over 2%, were refractured wells. The vast majority were in the Permian Basin spanning Texas and New Mexico and involved wells drilled before 2018. Rystad estimates that the count will rise to ~400 refracs by year’s end, or a little over 3% of total completions and comparable to last year’s final tally of 409 refracs.

“It’s a very niche market. The companies that are doing it are probably going to continue to do it, but I don’t think refracs are going to explode in numbers next year. I see stable activity that is very similar to this year’s 2–3% of total completions,” Justin Mayorga, a senior analyst of shale research for Rystad, has told the Journal of Petroleum Technology.

Indeed, Rystad says many U.S. shale producers use refracs more to protect the outcomes on new child wells that share the same pad rather than to boost production from older wells. It’s not for lack of opportunity though: in the Permian Basin alone, Alfredo Sanchez, CEO of oil field equipment supplier MorphPackers, estimates that there are tens of thousands of wells that are good candidates for refracking.

Nevertheless, Barba is optimistic that the U.S. Shale Patch will shift toward higher rates of refracturing in the not-too-distant future for one key reason:

 “We are seeing higher recovery factors on refracs–cumulative oil plus the estimated ultimate recovery (EUR) of the refrac–than we are in new wells.”

Authored by Kyle Anzalone via AntiWar.com,

Stockholm plans to send a “signal to Russia” by allowing NATO troop deployments in Sweden before the country is admitted into the alliance, according to top officials. Turkey is holding up Sweden’s bid to join the bloc.

Prime Minister Ulf Kristersson and Defence Minister Pal Jonson announced that Sweden’s military would step-up preparations with NATO in an article published in Dagens Nyheter on Friday. “The preparations may consist of temporary basing of foreign equipment and personnel on Swedish territory. The decision sends a clear signal to Russia and strengthens Sweden’s defense,” they wrote. The joint operations send “a clear signal to Russia that our ability to give and receive military aid is good.”

On Thursday, the Wall Street Journal reported the Swedish and Finnish militaries were rapidly integrating into the alliance due to a campaign by internationalist officials who worked to integrate the Nordic states into the bloc despite public opposition.

“Behind that long-standing public reticence was a meticulous, decades long campaign of preparation by internationalist officials,” the WSJ wrote. “Who since the 1990s sought to move their countries as close to the alliance as domestic public opinion – dead set against full membership – allowed.”

The article explained, “By the time public and political opinion last year swung behind joining NATO, the Swedish and Finnish militaries had been streamlined to NATO standards through participating in joint missions for 30 years.”

Last year, Sweden and Finland broke their long-standing policy of neutrality and formally applied to join the North Atlantic alliance. Their bid met stiff opposition from Turkey, which believes the Nordic states provide too much support for Kurdish groups that Ankara labels terrorist organizations.

A trilateral pact between Ankara, Stockholm and Helsinki led to Turkey lifting its opposition to Finland’s membership. However, Ankara says that Stockholm has refused to fully comply with the agreement and is still preventing Sweden from joining the bloc.

Russian officials have said Moscow will respond to NATO expanding its presence in Finland and Sweden. In December, Russian Defense Minister Sergei Shoigu said that “given NATO’s desire to increase its military potential near the Russian borders, as well as to expand the alliance by adding Finland and Sweden, it is necessary to take retaliatory measures and to create an appropriate grouping of troops in the northwest of Russia.”

The Washington-led alliance believes Sweden becoming a member will significantly change the geopolitical dynamics in the region. If Sweden and Finland join NATO, it could turn the Baltic Sea into an “inner sea of NATO,” Estonian Defense Minister Hanno Pevkur explained in September.