Big Digital Energy

0:00 All right. Let me let me ask you guys a question. What what happens between the end of college football season and the national championship? Christmas, a lot of shit talking. So I'm so I'm not

0:14 only am I on these all these texts and chains for falling. There's a lot of energy news to talk about. We are going to talk about it. But first, I am on I just put my head down. I've got 50

0:25 tweets going between two guys. One guy is a Longhorn. Another guy was a varsity player at Kansas. And he was throwing shade at Quinn Eures, which you know, Quinn UT quarterback. But it's

0:42 hilarious. What has gone down is this debate has been brewing over OSU's quarterback who is into the transfer portal. And there's this debate like he's a better quarterback. If you guys don't know,

0:54 it's comic board versus Quinn Eures. It's great. I love when we have nothing else to do. and we talk energy, and we talk college football, and it's all about guys that sit on couches, and we

1:06 complain, and we talk shit about guys that are playing in the real field. That's kind of crazy. But the biggest sports news of the weekend in this fun period for you was what? I don't know. Oh,

1:17 Tony signing700 million contract for the Dodgers. Oh, did he tweet about this? No, Tony, that's great. No, what I tweeted was because I lost in a playoff to Casey Clemens, but Roger Clemens

1:29 tweets a

1:32 video of his son striking O'Tonya out with a 49 mile an hour fastball. It was hilarious. They have these alerts. You know, when games get out of hand and position player pitching. Yeah. He was a

1:44 position player pitching and he rung him up. 49, a 90. No, 49. I think he just like threw it. It was slow curveball. Yeah. And just dotted the outside of the plate and he got rung up. So it

1:55 was pretty funny. All right, with a lot of news, boys. Yeah, we had some good news today. You know, it's funny because we had our PR public announcement of digital wallcatters, 25 million

2:08 raise, and I had this planned out for a couple of weeks and then saw the Oxy News, and I was like, God damn it, Oxy's stealing my thunder here. So, Mark, what happened with Oxy? Well, the

2:21 long awaited announcement, I guess, came out, Oxy announced this morning that they were buying Crown Rock, a Midland Basin private producer, which is part of the Lime Rock Partners portfolio for

2:35 enterprise value of 12 billion, it's a billion two in debt, 108 in equity. On top of that, there's gonna be, or in the equity component, there's going to be an additional raise of, I think 17

2:51 billion of that, and so 91 billion of cash plus cash from proceeds from an equity issuance. So,

3:01 no, let me back up. 91 billion in cash and then there's an equity component of 17 billion that makes up the equity and then 12 billion assumption of debt. So puts it right at 12 billion, which I

3:14 think is on the more robust or richer side of what was expected. I remember, I don't wanna put words in his mouth. I remember Dan Pickering tweeting about when the rumors were out that the talk was

3:29 somewhere in the12 to13 billion range that they better have a good explanation for that. And so at the very top of the announcement talks about the immediate and significant accretion of free cash

3:41 flow, only ordered 25. A

3:47 billion dollars in year one. And it looks like the operative price deck is somewhere between 65 and 75. I listened to a bit of the intro

3:58 but got sidetracked on. Yeah, but what about the synergies? It's always, it's always about synergies, bro. I think he did say we welcome all qualifying crown rock employees to the Oxy, to the

4:11 Oxy organization. I want to give a shout out to Aubrey Kay, my good friend Aubrey Kayver on Twitter because November 29th, oh, Kirk's over here throwing up the horns for you. So we'll put up the

4:23 tweet We'll put up the tweet, but some journalist said, tweeted another scoop hitting Wall Street Journal, Occidental Petroleum is in talks to buy closely held Permian producer at Crown Rock. Now

4:34 it's back on

4:37 November 29th then. Actually, I think Aubrey might have done this before that, but he retweeted it, said the plane don't lie and was tracking Oxy's plane flying up to Omaha, Nebraska. It's a

4:48 little warm buffet. And so Aubrey always likes to joke that he uses his landman skills, hunting people down. Dude, he did. I mean, he posted that. Yeah, and so - Shout out to Aubrey. November

5:01 29th. Kind of crazy, man. You can be getting all this good. So, oil MA. So, Crown Rock has been around in the Lime Rock portfolio for, I think, an unconventionally long period of time. 2007

5:18 is the genesis of Crown Rock. I think Lime Rock has been unique over the course of its ownership, and this is in consultation with our traveling partner Chuck, who is our resident private equity

5:31 landscape and relationship expert. But, you know, over the course of time, they've done some very creative things to. Are we just not recording with Chuck for a month? I just realized that. No,

5:41 we're not. I mean, we've kind of said Chuck. You could definitely call in if you wanted to, but we're just not doing it. I mean, let's be honest. I know the rumors are gonna hit. We asked

5:50 Chuck to take a break We might welcome them back, but right now Chuck is. It's take a break. He went off to Europe. Hey, real quick. I know you're like in a really important point But I didn't

6:01 give Aubrey his full props because he actually posted it in November 2nd Dude Aubrey K is he's a month a month and a half ago And he said smells like an oxy acquisition and it shows plain traveling

6:12 between Houston Omaha and Midland

6:16 He puts that a month and a half ago. We need to get him on the show, bro. We do No pun intended. That's the preferred route if you remember the Anadarko transaction on the big preferred way. You

6:27 got to kiss the ring in Omaha, right? So

6:31 You know, I think I think the unique profile and timeline of Lime Rock's ownership of Crown Rock and the ability for them over time to do creative things to provide liquidity along the way to their

6:45 LP speaks really to the company building aspect of the Crown Rock story, which is I think increasingly unique. in

6:59 the world of upstream private equity. I mean, think about 2007. We've been through a lot a couple of times since then. And so, you know, credit to those guests for getting the steel done in a

7:07 lot of cash. I mean, I want to unpack this a little bit, but first of all, thank you, David Blackman. I follow him on sub-stack. He always is writing great stuff, but he posted a letter from

7:21 Andrew Dittmar, senior vice president at Inverse Intelligence, who wrote, 'cause you said earlier, like, you better have some justification when you're paying50, 000 an acre. And quote,

7:33 this is from the letter. Another motivator driving this lady's way of a deals from the buyer's perspective is a sense of urgency to secure shares of what is perceived to be the last tranche of the

7:44 Permian region's highest quality drilling prospects. Quote, EIR calculates that there's only about six years of the highest quality inventory capable of generating A 10 return.

7:57 at a45 oil price, left at current drilling rates and over 70 of it is in the Permian. In quote, With no new shale plays on the horizon and global opportunities shrinking, the Permium also leads in

8:09 potential for finding new resource as drillers test additional benches of the region's stacked pay. What do you think about that? I mean, that is, to me, the justification for Oxy jumping in What

8:24 say you, Mark, you're the sort of, you're the man on this. Yeah, I do think

8:34 the fear of the music stopping without a chair is part of the dynamic here. And so this is clearly a

8:47 scale up in the middle in basin, how much of that is left in scale with any kind of continuous nature to the acreage. 1, 700 plus development locations, I think

9:04 they characterize 1, 250 of those as development ready at60 or below, which kind of made me raise my eyebrow. We're talking about60 break-evens as a threshold. Now, a number of those 750 below,

9:18 I believe 40 or 45. So you start to break that down. What about the 500 in between that lower bar of break-even to60 WTI? We're having to look at things that in the way Oxy characterize this moves

9:35 to the upper tier of their portfolio. And so if60 is coming into the conversation as a break-even threshold,

9:45 then I think that's different than some of the talk that we've heard recently around other deals because the view as the productivity, the cost efficiency, etc.

9:60 the economics around a high-graded Permian Basin, particularly in the Midland Basin. Brake evens are generally accepted to be down certainly much lower than 60 in the '40s and the '30s. I mean, my

10:09 dad was born in the Permian. So, I mean, the Permian Basin, Midland has been in the Permian Basin at all. Has been this like hilarious, incredibly most important place in the world, especially

10:24 for the United States World War II, but there's also times where Midland's been a piece of shit and no one wanted to be there. Oil prices sucked and everyone's trying to get the hell out of there.

10:36 What's gonna happen over the next few decades in the Midland? 'Cause right now we're saying Midland's the most important dirt in the world right now. You've got Exxon, you've got Chevron,

10:47 everyone's jumping in, not Chevron, but Exxon. Oxy's now jumping in. What do you think over there? and I've heard. from a good source that Endeavor deal is close to getting inked up.

11:05 You know, there was a conversation on collide the other day about this, um, Shadd Frazier had wrote a really good post, you know, Shadd's over at Endeavor and it's talking, what does the future

11:17 of the industry look like? Because this industry is always, you know, found technological advances that are not new oil, but, you know, here we are tapping into the source rock into Shell and

11:29 really kind of chewing through the best inventory already, you know, some of the best rock is already in the days behind us. And so what does the future of American oil look like? And it's all to

11:39 my read this book is called Wildcatters and sent in my living room in a written pre-shell. And it's talking about how oil independence in the United States or some of the most resilient businesses

11:53 that have ever existed.

11:56 There's always like, oh, there's gonna be a roll-up. Everyone's gonna get rolled up, but it just doesn't, it doesn't happen because there's so many entrepreneurs in the industry that find a

12:04 little niche, that carve out. And it kind of brought me along the lines of thinking as well. It's like, if you look at how much oil we recover, I mean, it blows people's minds to know how much

12:14 oil we leave in the ground. And I have a hard time believing that the send a shoe will be content with how much oil we left in the ground. And so start putting a lot of resources and energy into RD

12:24 on how we go and recover that. And so I think that if you look at Twitter, there's a lot of doom and gloom on peak shale, peak American oil and gas, but also just one thing I know about this

12:38 industry is that it's resilient as fuck. It's like a bunch of cockroaches you just can't kill. Well, and that

12:46 analogy is better than at the trough when we coined the terms somewhat uniquely for EP

12:54 survive and reincarnate in chapter 22, chapter 33,

12:60 bankruptcies, you know, you can't kill 'em. It's no matter what. I mean, if you're an idiot and treat some of our audiences, they just don't know, which I'm one of them. But I see a couple

13:13 things. I see oil prices right now around what, 70 or so. I see this as a number one, almost an all cash deal So if I'm an independent in the Midland and Permian, am I thinking shit, dude, I

13:28 want cash, number one. Secondly, they're paying 50 grand plus per acre. This is skyrocket. This is not a100 oil prices. This is70, let's say, but the per acre is huge. What does that say?

13:46 And what's, if you're an independent right now, are you thinking shit, it's time for me to sell?

13:54 paying a premium for near-term cashflow and comes out on a metric that I think is less primary to the acquisition conversation. I think it also speaks to how urgent things have gotten for the buyers

14:08 that are out there. But why is it urgent? What is the sense of urgency now?

14:14 I'll tell you one thing I know about this industry is it's a bunch of followers. That's what I'm saying. What is so urgent right now? It's like, oh, Exxon's making deals, I mean, it

14:24 always comes in. Someone created urgency, we're all feeling it, but why? What's this? It's just a muscle memory competitive response, right? It's

14:36 the answer question, it's more of a psychological driver than it is like an actual physical or economic driver. I think this is what's driving all of it Everyone's scared of Nicholas Maduro taking

14:50 over Guyana and then he's gonna go after Midland, it's it. They're just, we're worried about global domination. Did y'all say my tweet that went viral about Venezuela? Dude, let's go, let's

15:00 move over. Did y'all see that? No. So December 7th, I tweeted, Venezuela military versus ex-hon private contractors. Who you got? It was a poll. Oh, I like that. Yeah, it did. 1, 000

15:11 likes, 300, dude, it's the stupidest stuff that - Dude, I am totally like - I thought the Tam of that tweet was like 10 people. You know it's gonna be the private contractors. They've got better

15:21 equipment. So there's actually some interesting comments They're like, if this was Exxon from the '90s, take Exxon from the '90s, but not the de-famed ESTT. Oh, are they kind of weak now? Exxon,

15:32 I don't know. I don't put up with Exxon.

15:36 Well, let's not forget that China is in the block as well, in the form of Cinoc, so - Cinoc, they've been there. Yeah, I know. Have we transitioned to Venezuela? We're gonna go, but well, we

15:50 can - We're walking up the run of show backwards We can bounce.

15:54 We got to say we do here. We got to say fluid in our runner show. That's just more of a suggestion. Yeah, let's go Let's do it. We're we're we're now in Venezuela. So let's actually yeah Let's

16:02 talk about this because I'm not really up to Up to speed on the topic, but I did think that it was funny that Venezuela just published a map Same as ours. I think that's like is that is that the way

16:15 it works as well? You just like publish a map in his desires, but I actually look I think someone who wrote a Twitter thread about this, but there's actually a lot more history Behind this then

16:27 just oh Gowna has oil. We want it like there's actually been

16:33 a lot of Back and forth over the course of here's just a a short history October 18th

16:42 The current administration the Biden administration They do a deal with Maduro to keep trying to get more oil in the market And in exchange for that, and this is October 18th, in exchange for that,

16:56 they're saying like, Maduro needs to have like fair elections. So fast forward a few weeks.

17:03 December 3rd, Maduro claims victory in a national referendum saying that he has overwhelming support. Now, supposedly only 12 of the registered voters turned out. He says, he says over 51 turned

17:16 out. Though he's saying, no, no, no, half the country And not only did half the country show up and voted for him, by the way, he's claiming that 98 of the voters approved the invasion. So the

17:29 Venezuelans want it. Now, if I'm in Venezuela, maybe I do want it because things suck because as we're seeing, and by the way, again, thanks, David Blackman for this data, but per capita in

17:42 Venezuela has dropped from12, 600 or so a person in 2011 to 3, 423.

17:51 I mean, inflation's running a saw a statistic on world statistics that Venezuelan inflation tops the world ranking. That's not a ranking you want to be on top of, but I think it's running in

18:03 currently about 311. 359, okay. I think it's - So it's changed in the last few days. I think it's interesting that Venezuela wants to annex part of Ghana now after this big oil discovery. But you

18:17 look at what Venezuela has done historically to their oil industry, I mean.

18:23 Well, you have oil reserves and you just can't economically get 'em out because - This territory that's been in dispute goes back to the 1800s with the French and Guyana. And conveniently and we'll

18:35 post a map of the area. Conveniently the Venezuelan boundary line encompasses that onshore isquibo territorial region, but also the territorial waters that basically. covers all of the staybrook

18:52 block,

18:54 which is massive. Which unlike in the 1800s, they didn't know about the stray book block, so. It's producing 400 plus thousand barrels a day going quickly next year to 600, 000 plus barrels a day.

19:06 They gotta say that they can get it to a million barrels a day. Releasing the map just seems like a very 1800s move. So we had the luxury of speaking with someone who had spent a lot of time both

19:22 back in the day when things went

19:27 south in the

19:30 late '90s with the emergence of Chavez and basically kicked ex on out and then Chevron's left with a lot of uncertainty over its assets and country And you basically fired all the technical. in

19:50 managerial and operating competency within Pedovase and replaced it with high-ranking military. Now you've seen what's happened over the last 25 years. This all started '97, '98. I think, excuse

20:04 me, Chavez, attempted a coup in '97 was successful in '98, and then from that point, we've seen nothing but a spiral. This latest easing of sanctions is a bit of a glimmer of hope, but

20:18 immediately upon the heels of that, as we saw, Maduro's out laying claim to

20:25 the

20:27 territory that includes Staybrook and also behaving very aggressively as regards the long-running dispute over the disputed territory of Scebo. So

20:38 what's motivating this? It's, as you pointed out, with some of those statistics on per capita GDP, what's happened with - The, we talked about it a few shows ago, the auction ultimately of Sitgo,

20:55 which will leave Venezuela with nothing because those proceeds will be used to satisfy in part their huge and very dead obligations. And certainly Maduro sees this as an opportunity to be aggressive

21:10 and reach out and grab some cashflow for himself. And I think from a populist standpoint, the support for that to help the suffering people of Venezuela is probably something that shouldn't really

21:27 surprise anyone. And so you're facing a fairly complex set of dynamics too. We mentioned that Cinox in the block. And I think during the period of the most severe sanctions of Venezuelan

21:46 export, C-Knock has been. one stalwart customer. And I think the Chinese would probably step in the middle of this and if they haven't already and reminded the Venezuelans in Maduro of that very

21:58 fact, Chinese have been big buyers of Venezuela. I know this has the whole - Exports reading. Reading of there's big states behind this. I mean, I wouldn't be surprised if China wasn't pushing

22:08 from both sides. Maybe, maybe not, but there's so much oil at stake here. Yeah, you know what's interesting is a trading and it seems Brazil is on guy on a side. So yeah, the United States,

22:22 Brazil, which I don't know what Brazil's political motivation is for picking either guy on an orphan or a Venezuela. But yeah,

22:35 I imagine that it's not just some simple dispute. I'm sure that there's other players that, all right I mean, Majora is more friendly to Russia and China and we have had sanction, pretty tough

22:49 sanctions against Venezuela. So in some ways, you know, if Venezuela gets any anything in this dispute, it seems like the Russians or the Chinese will come up on top. So it's definitely, and

23:04 Cenuk has a position there on the guy and a side, but this is interesting. This is interesting to see how this plays out and it's definitely gonna be political. There's a lot of, did you all see

23:07 Argentina's new president? Yeah. The

23:18 election,

23:21 he already cut like nine, like, he already cut like nine ministries. Yeah, he said that he's on the ball. Said, I saw a quote that essentially he's promising economic shock treatment to the

23:37 country. And so just a lot of movement down in South America.

23:44 Yeah, I wonder what it's gonna happen the contracts down in Argentina's regions. Yeah, I have no idea. I've figured there's gotta be some implications for that, it seems like a pretty big deal.

23:58 So I'm sure that we'll be talking about South America for them near future on the show. Yeah, lovely. Love it. Should we go down there and do some inspections? Yeah, absolutely. I know it's

24:09 funny, it's like back in 2018, this consultant hit me up to help consult on Venezuela, especially around oil and gas technology and Bitcoin mining. And I was like, Dawg, I'm. And he was talking

24:22 about new regime coming in. And he's like, If this regime wins, they're all American educated, want to Harvard. He's like, It's an opportunity. He's like, I want to figure out how we

24:32 revitalize the oil and gas industry. And back then, I was just like, Dude, I'm way over my head here. I'm like, you're talking to the wrong guy. I was like, I don't know anything about helping

24:47 nation's revitalized oil and gas industry. So so we've got we've got we've talked about Midland and the frenzy. We're talking about Venezuela, Guyana, which is all over oil. And the last part of

24:60 that you mentioned, it's going to be political. I guess our next topic moves squarely into the realm of politics. Yeah, let's go ride it. Let's go across the pond to the desert and talk about cop

25:12 28. What are the remnants Mark from cop 28? What can we say about it? Well, hasn't already been said kicked off with the I a declaring that this was a moment of truth for the oil and gas industry

25:25 and issuing another of a in its series of very pointed reports, pointing fingers at the oil and gas industry. And then coming into the the final week of cop 28 was really the the meat of the

25:44 negotiations and trying to get to an agreement. whereby there would be a conference of the party's language that would set forth a timeline for the phase down or phase out a fossil fuels explicitly.

26:02 That didn't make it to the last draft. And so, certain of the higher profile and louder voices at COP 28 had some words to say about that today. And what was that? Three hours ago, I mean, when

26:15 Al Gore, who is completely motivated self-interestedly to kill fossil fuels, his tweet is the best. Or is it an X, what do you call it now? Is it an X? You know what I'm still trying to, the

26:31 other day when he had that. Just call it a tweet. When he said go fuck yourself, he also in that same talk said that if anyone can figure out what to call it, other than a post, you would be

26:40 appreciative. This is Al Gore's tweet three hours ago COP 28 is now on the verge of complete failure. The world desperately needs to phase out fossil fuels as quickly as possible. But this

26:52 obsequious draft reads as if OPEC dictated it word for word. It is even worse than many had feared. It is quote of the petro-states by the petro-states and for the petro-states end quote. It is

27:05 deeply offensive to all who have taken this process seriously. You mean all those who are profiting from a fear that was started without science There are 24 hours left to show who side the world is

27:18 on. The side that wants to protect humanity's future by kickstarting the orderly phase out of fossil fuels or the side of the petro-states and the leaders of the oil and gas companies that are

27:29 fueling historic climate catastrophe. In order to prevent COP28 from being the most embarrassing and dismal failure in 28 years of international climate negotiations, the final text must include

27:41 clear language on phasing out fossil fuels Anything else is a massive step backwards. from where the world needs to be to truly address the climate crisis and make sure the 15C goal doesn't die in

27:55 Dubai. Meaning call it the North Store? That's the new characterization of 15C. It doesn't die in Dubai, baby.

28:05 With the new slogan. You know, I was talking to, I was in Austin and I was hanging out with this neuroscientist and she's super smart and she's over in London and

28:18 we're talking about

28:21 just the bias in science now and how there's this kind of dogma around it of you can't actually speak about facts because funding may dry up. If you do that and we're talking more about medical and

28:36 neuroscience research, but then I started talking about, it's like, yeah, you see this in climate as well Just, you know, data doesn't lie, but humans do. and the way that you

28:49 cut up data and present data and it's very easy to craft narratives and I think what we've seen over the last two years is that the world is coming to terms with reality on what energy policy actually

29:05 looks like and so I don't know what actually came out of COP. Was it 28? Cup 28, yeah. Exactly, it's so fucking irrelevant to anyone that actually works in energy, in my opinion. I

29:20 just think that people are seeing that that's not actual signal there that end also just having to cope with the realities of the situation. Well, I can tell you. Like I've been out going soon

29:31 right now I was like, he's coping. According to Bloomberg, I know the planet is really worried about climate right now because a record 75 million people are expected to fly during Christmas New

29:43 Year holiday period.

29:46 According to AAA, who began tracking the date in 2000, this will make it the busiest year in travel season since 2000, since they started tracking. I saw a video going viral on Twitter yesterday

29:58 of how they clean snow off the streets in Montreal, and you have a - Oh, I saw that. Yeah, you have a front loader with a bucket go, and it scoops all the snow to the side, and then a dump truck

30:10 comes by with a snow blower and they fill it and like, there's like six or seven trucks involved in this thing. Sounds like a lot of diesel. It's a lot of diesel. The good thing is all the CO2

30:19 emissions from that diesel are gonna thaw out the planet. That way you don't have to scoops. It's a snow first place, yeah. I thought Dan, who tweeted this morning about cop 28 Dan Pickering,

30:30 maybe that was yesterday.

30:33 Cop 28, get a bunch of people together, argue strenuously over fossil fuel limits slash language to have a quote unquote successful summit, and then everyone goes back home and ignores what they

30:43 just agreed to because it isn't practical. or economic in the short term. And I replied to that there is no long-term in politics. Unless your name is she or Putin or Maduro. And what we're seeing

30:57 and bringing Argentina back up. It's like the dictatorship side. And the Netherlands were people have a voice at the ballot box and in part have expressed through a referendum on what they're facing

31:12 in accelerated energy transition and ill-advised energy policy is they're gonna vote them out.

31:22 And so the impasse continues. The other thing that I somewhat chuckle at the headlines, which now take pretty liberal license with claiming that this is what the world wants. Well, there's 70,

31:37 000 people in Dubai, that's not the world These are the conference attendees. these are the conference leading voices on both sides of the debate. This is not speaking for the world that has

31:52 clearly evidenced by some of these election outcomes. And I think 2024 on this issue for the US is going to be very interesting to watch and monitor as well.

32:04 Well,

32:06 it sounds, it seems like the pendulum's long. Oil is falling oil We talk about COP 28, you know, we broke EV, the EV story about, we did, we were the first to talk about it. What story? Just

32:22 in case. There's a glut that sales are slowing down. Yeah. And then all of a sudden the media weeks, maybe a month later started covering it. Well, here's some new news. A couple of things that

32:33 are interesting. The, it's going to get more expensive to buy an EV So this is just sort of self fulfilling prophecy here, 7, 500 discount you get, no longer applies, starting in next year.

32:49 Tall EVs? EVs that have China-made parts, or not US, not made in the USA, will only be able to get a3750

32:59 credit. Oh dude, that's a pretty big standard. That's big news. That's big news. Yeah, because I mean, that's7, 500 tax credit is super incentivizing for new EV purchases. Cut in half Cut in

33:13 half and probably not applicable to a lot of the cars. So Tesla, Tesla Model 3 will be have that, they don't qualify either. So most EVs - I mean, parts not made in China, like that's gotta -

33:29 But China has 90 of the - Especially battery parts. Battery parts, yeah. That's right. That's crazy. And Tesla is

33:35 565 market share as of Q3 of this year in the US I don't think I personally agree with that approach. to be honest. You know, if you want to get rid of the subsidy, cool, understand that. But

33:50 saying any car that uses parts from China, like, I don't think why, why would these?

33:58 I just don't see how that incentivizes manufacturers to say, Oh, we need to get America like they're not going to switch their supply chains, especially around batteries to the US to capture this

34:10 Well, we don't have a number. It's going to take years for that infrastructure. We haven't happened. Yeah. As we we've talked about lithium mining, you know, I mean, all these things need to

34:19 years and years and years and years before, yeah, you're going to be able to do it. And how far are we going to go and the true supply chain, the value chain of producing, mining, transporting,

34:33 all the way processing, well, that thing Manufacturing, finishing, assembling, how far are we going to go domestically? It's a global market. Everything is a global market. I mean, we're

34:44 dependent on other people's supply chains. I mean, we kind of have to understand that.

34:49 It's even, you know, when we look at solar and wind and these things, like, I've always said, I don't think there's such things, energy independence. I think that you have to think about energy

34:59 diversity and security and just seems like, I don't know, I don't think that the way to limit the subsidy is by cars that have parts made of China It just doesn't, I don't think it's realistic.

35:13 Well, I think that let's see how prescription drug relief, price relief would work if you said, well, it doesn't apply to pharmaceuticals that have any component that's sourced from China, which

35:25 is bigger than you think. Yeah, that's what I'm saying. Well, I know I get my fentanyl from China, so. It comes from Mexico, but the chemicals are sourced there. I

35:37 will say it in a roll. Here's an interesting story that came out the washing post. You know, WAPO is. is insane anyway, so take it with a grain of salt. But they have analysis that shows, and

35:48 this came out this morning, that eight fatal accidents, Tesla accidents, were due to the autopilot feature being turned on when it should not have been accessible. Now they're claiming that this

36:02 is one of the reasons why EVs aren't being bought, and I don't think any consumer probably thinks about the fatal accidents using autopilot. But this is an interesting story, because people are

36:14 dying because they're trying to use this autopilot feature. It's not completely baked. And one of the reasons why it's being used, like when it's on narrow turns and hills, and I guess software

36:25 can't see all of that.

36:28 But what do you think? Tell me the story again. You said that these are fatal crashes by people using the autonomous driving feature that don't have access to it. No, eight fatal accidents with

36:40 Teslas, that had their autopilot feature turned on when it should not have been accessible. I think that's what I'm saying. So it should not have been accessible, but does that mean like? I think

36:53 what, and I listened to the article, there was actually a news article on it. I think it was more about, consumers have the ability to override the system. The manual says you shouldn't do it,

37:07 but they do it anyway. It makes more sense 'cause it shouldn't be accessible I thought they like jail broke their car or something. Well, that's got access to it, even though they don't have paid

37:17 access. Well, this is actually an interesting legal discussion because right now, because technology's moving so quickly, the regulators are following industry, which says, Hey, we're telling

37:30 consumers don't do this. If they do it, it's on that. So it's really, the legal liability's falling on the operator and the operators are choosing to use a feature

37:41 Yeah,

37:43 the greatest idea. Yeah. I can tell you, having used autopilot in my car, I hate it, man. I want the control. Really? It does shit that makes me nervous. I'm like, I need control. In which

37:55 car? The Porsche. In the Porsche? Yeah, maybe nervous. I mean, the only autonomous car I wrote in was a autonomous lift in Las Vegas. And actually, I enjoyed it There's one time though, so

38:12 they had a driver and then they had a second driver in the passenger seat. And there's one time a car pulled out, taking a left-hand turn in front of us and the driver had to hit the brake. And I

38:23 made some comments like, Oh, no, the car would have caught that. And I was like, I don't think so. No,

38:28 I don't think so. I don't think the car would have caught that, so. But I mean, you talk about like, especially like straight highways in Texas. Like, I'll let it run on. That's one thing.

38:37 Autopilot. Yeah, that's the only time when you're not turning. I mean, it's just, it's just the number of real-time variables. Yeah. That you have to adjust to. If you're going on. That are

38:46 unique and not, yeah. I've noticed on. Not inherently predictable statistically. My existing car, which has a lot of, has all these auto features. When you're kind of going on a highway that

38:57 splits, it gets confused. It's like, shit, am I going right or am I going left? I don't know where I'm going. And you kind of like get real nervous. Yeah. 'Cause the car will fight you until

39:08 it figures it out. I'm like, yeah You know what's the feature I hate is assisted driving. Like Toyota has it, Chevy has it. 'Cause you'll be going like 70 down the highway, and like you want to

39:19 like cross lanes or something, and it like jerks the wheel back. I know. I'm like, what the fuck? You're about to flip, bro. I feel like I'm about to flip the cars. So I'd rather have full

39:28 autonomous and assisted. So what's the, so let's just take all this back. What is the show about today, which is interesting?

39:38 From the producers to the consumers, oil is taken back the conch. Evie's are struggling. Cop 28 is in some ways a failure according to the climate,

39:52 the pure climate, folks, episodes called dose of reality. You've got Midland going big. There's, there's, we don't know what the if it's irrational exuberance. We don't know what it is, but

40:04 Midland's pumping more acquisitions, paying premium prices. You've got disputes over oil-rich territories in, in South America.

40:17 What, what's your, what's your takeaway?

40:21 Besides the, besides the audience, when you've got millions of people traveling by air now, again, they're not worried about emissions. I want to get places. I would call this episode dose of

40:32 reality to start out and name it. That's what Jacob needs to name this episode. It drops. I would call it the intersection ideology in reality, bordering on a collision or a collide.

40:49 And we're starting to see, we're starting to see actions related to where people are in their own lives. And what I'm talking about again is how they're voting in energy policy and getting that

41:05 right has got to be practical, pragmatic, and considerate of those who don't have it, have the most difficulty accessing it because their hierarchy of want need starts with basic standard of living,

41:22 well-being, surviving, thriving, and then moving up the economic ladder.

41:29 And right now, the

41:33 scale of the abundance, the availability, the affordability and the energy density, we still haven't. come up with a wholesale transition solution where we can flip a switch and make that happen

41:47 in a short period of time, even defined as between now and 2050.

41:54 I'm gonna end it with this. That's interesting. My boy, now my boy, Aubrey Kay.

42:00 This is his latest tweet. I just think he's so funny. CQ Ops guys lining up at Silphore to place F-250 King Ranch orders today Aubrey's always good for keeping his finger on the cultural pulse of

42:15 West Texas. Dude, his are always, always having me chuckling, for sure. Speaking of friends and associates and cultural phenomenon,

42:29 Chuck just texted, By the way, the Brits love me. There has never been so much awkwardnessbetween the US. and Brits since the Delaware.

42:41 And as I've said before, Chuck has the highest awkwardness threshold of any human being I've ever met. So it's good that he's on the front lines. Yeah, that's right. I think I also very much

42:52 enjoy awkward interactions too. So me and Chuck, that's probably what we bond on is awkward interactions. But all right, is that is that it for the run of show or do we have that's it? I mean,

43:04 that's a lot of news. You know, I think that let's you want to talk about sunflower seeds. Yeah Yeah. So I come in the other day. Oh shit, dude. Yeah. Yeah. You're confronting me. That's

43:17 crap. Man. If I come in here, like I was already, I can't remember. I was already in a bad. It was in this room. Yeah. I was already in a bad mood for some reason. And then I come over here

43:25 because I had a phone call and there's a pile of chewed up sunflower seeds on the floor over there. So I would get the vacuum. I come in here and a vacuum them up. And I wasn't even thinking I was

43:35 like, Oh, this is, this is where Kurt sits Kurt has And then I walk into the war room and someone had spilled something on the floor from the microwave, so I'd get on Slack and I came out of the

43:46 fuckers, if you spill something, you know, pick it up, it's not a daycare. Talking to you guys, too. Yeah, and then Chuck sends it to Yell's group text. And anyways, I was in a mood, but -

43:57 I just wanted to remind you, I sit on that side. Dude, if I did it, I'm sorry. And if I, I'm usually great at cleaning. 'Cause I'm a clean freak. Hey, what? And when you're CEO of a company,

44:07 there's something that you notice more, especially trying to keep some, like your office clean, for example, and you realize no one else cares. Yeah. And that's the, you realize most employees

44:21 think, like employees versus you think like an owner. Yeah. You don't think like an employee. You're an owner, you're like, everything I do. It's like you wanna be proud of everything that you

44:29 do in your space, but it's all right, I forgive you. I told everyone, one team. Least you didn't slowly point to us at year Y'all both.

44:39 I both gave a heartfelt apology and I let everyone know since they took the, they took the ass chewing on y'all's behalf, but. Mine was more of an alibi. Yeah, and you know, you definitely said

44:50 it wasn't you, but I was like, my solo cup made it to my truck. It's always the person that denies first is the winner. And, you know, I was last on that one. So Mark just left you out hanging

45:01 to dry. So anyways, guys, appreciate y'all being in today for the show. Appreciate everyone listening If you can, please share the show with a friend. We've been getting a ton of great feedback,

45:12 a ton of great comments. I see people over on LinkedIn saying that they're listening every week. Can't tell you guys how much we appreciate that. It means a lot. And so we appreciate your

45:21 continued support in sharing the show.