Saudis are at it again + an interlude with Nolan Ryan

Newsletter No. 17

Good morning.


Hope everyone had a great week last week. Let’s dig into some big news in the OG world this week.


Today’s Headlines

  • Saudis to Cut Production Again

  • The Latest on the King Project in the Permian

  • Nolan Ryan and John Elway Join the Fight Against Cancer

  • Deal of the Week: ConocoPhillips Makes $3B Acquisition

  • Well of the Week: The O-14 in Russia

  • Song of the Week: by Jelly Roll (not a typo)


Saudis to Cut Production Again

In a price war that just seems to keep rolling on, another production cut has been announced for July along with OPEC+ extending cuts into 2024. Leadership continues to claim Western nations are interfering with pricing since Russia’s invasion of Ukraine. 


Maybe they are on to something here? There are many odd occurrences in the US that have cooled Oil and NG prices over the past year. From multiple takes from the SPR, to a mysterious crash of a server farm that manages the supply and demand data used by the EIA, to the LNG explosion in Freeport that included an unexpectedly long and rigorous regulatory approval process for getting the plant back online…the list goes on and on. 


I have no idea where pricing will go. But I personally hope it accurately reflects true supply and demand fundamentals. But maybe that’s just a pipe dream?!



The Latest on the King Project in the Permian

We are looking forward to producing and completing the first 3 wells in Borden County in our Believers Project. Drilling on the number 3 well has been completed in the Mississippian Chert formation, as it now shifts to completion phase (completion includes a variety of steps to prepare the well bore to extract hydrocarbons from the formation, post drilling). 


The number 2 well was drilled in the Ellenberger formation and is a week into the completion phase. The rig will remain running in this project to develop 1, possibly 2 more formations (Wolfcamp and possibly Spraberry). That puts up to 5 formations within line of sight to set a cornerstone for proving up this field. Lots of work to do still as production is still not yet flowing.



Nolan Ryan and John Elway Join the Fight Against Cancer

I participated in a large event to raise money for Prostate Cancer took place at Castle Pines Golf Club in Castle Rock, CO this past week. The event raised approximately $1.7 million for the fight. I did not know how many men are affected by Prostate cancer, but do now: 1 out of 6 men will get it. But it can be treated if found early enough.  


John Elway sponsored the event, and King Operating’s CFO Graham Patterson and I were fortunate to play golf both days with Nolan and Ruth Ryan. Nolan was pretty sharp out there on the course. We met years ago and it was great to get reconnected.  


If you haven’t watched  Facing Nolan on Netflix, it is worth the watch. One of the takeaways from the film was how important Ruth and Nolan’s relationship was as he played in the Majors. It was an honor to spend time with her on the course as well.



Deal of the Week: ConocoPhillips Makes $3B Acquisition

CP was already in this Canadian Sands project, but boosted their position with TotalEnergies. This was a huge deal in part because the transaction thwarted Canadian producer Suncor in their bid to do the same. As it stands, they are the odd man out. If you want more A&D info, Hart Energy has a brief but informative video wrap-up of M&A activities for the week. You can check it out here



Well of the Week: The O-14 in Russia

The O-14 has a measured depth of 49,000 feet! It was drilled by ExxonMobil in 2017. But there’s a lot more to the story because it was claimed to be the deepest. And that’s not exactly accurate. In truth, it’s relatively shallow in that it’s vertical section is less than 3,300 feet. But the lateral portion…WOW. That’s almost 46,000 feet!


By comparison, we here at King drill up to 2 mile laterals (approx 10,000 feet). But if you want to know the truly deepest well ever drilled, the following story published a few years back is pretty informative about multiple deep wells and the results. One of them is infamous across the globe. You can check out that story here.



Song of the Week: by Jelly Roll

I know.  I know.  A lot of you may be thinking…Jay Young has a SONG of the week?! And I agree, I find it humorous that I would have such a thing, BUT I was driving to church for Sunday School and heard a song on the radio from Jelly Roll called Need A Favor. And I was moved enough by it that I wanted to add it to the newsletter.  


The lyrics include a line, “I only talk to God when I need a favor, and only pray when I don’t have a prayer so who are we when we ask for a savior???”.  Wow! That really resonated with me. We only think about praying when we need something. The older I get, the more I know I should pray every day. I am thankful for all God has done in my life.

The Upside of Oil and Gas Investing | WBAP via FOX News Radio

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Recommended Reads

Saudi Pledges Big Oil Cuts in July as OPEC+ Extends Deal Into 2024

ExxonMobil: New Fracking Technology Can Double Oil Output

US Crude Joins Biggest Oil Benchmark

There are some outstanding results developing in the current program… KOPX Program 4. If you are not in it, and you are accredited, it’s a good time to have a conversation! You can schedule a Zoom here.


All the best,