Ferg's Finds

This is a short weekly email that covers a few things I’ve found interesting during the week.

Article

U.S. oil output growth slows, gas begins to fall (the attached chartbook gives a great overview of US oil & gas).

These charts reinforce Cole Smead's (h/t John Polomny) point that shale producers' CAPEX as a percentage of operating cash flow is insufficient to maintain production, let alone grow it (Shale producers' CAPEX as a percentage of operating cash flow sits around 30% vs. over 100% in the 2010s, when production grew rapidly).

Podcast/Video

Mike Alkin - Uranium Market Insights, Inventories, Delays, Q&A

Lucijan asked Mike a question I’d been itching to ask him at 36:00min mark on Green Field projects (as brownfield no longer closes the S/D gap).

Quote(s)

“Druckenmiller said that Soros got about 1/3 of his ideas right, but he killed his losers fast and rode his winners to the moon.”

It sounds simple enough, but it is human nature to "ride losers hoping to get back to breakeven" while realising winners early (it's hard to really give things room to work as you have to talk yourself out of selling them constantly, and as the position size grows, the subsequent volatility gets more painful).

Tweet

The other side of the shale arguement.

Charts

Deepwater offshore is next in line behind tight oil on IRR and average payback time (@$70barrel).

Something I'm Pondering

I’m pondering how long the new-well oil production per rig can hold up as rig count continues to roll over.

I hope you’re all having a great week.

Cheers,

Ferg

P.S. I now have a directory for all my articles (free and paid). Or if you’re interested in my story and why I started this Substack, you can read the story here.