Big Digital Energy

0:00 What's up everybody, welcome to another episode of digital wildcatters. Is it summer yet? It's summer because I'm not in Nantucket. So I'm pissed. It's a hundred degrees already. Got Nantucket.

0:13 Why not in Nantucket yet? I have stuff to do, man. Like I'm working these days and I'm trying to figure out. Do I drink tequila, bourbon, or a Scottish whiskey? What are you going to drink on

0:25 this show? It's also not thirty nine thirty in the morning I'm sorry, I'm sorry, oh, gosh.

0:33 Good movie, Paul. I saw yesterday this clip come up on Twitter of David Portenoy. It's an old clip, but it's like when they're having these protests and the guy's anti-capitalism and David

0:41 Portenoy is like, Well, don't you think a guy like me that's worked as hard as I have? Like, I deserve to be rich? He's like, I'm really rich. He's like, You know,

0:51 I live in Antucket. And the guy's like, I don't think that you should be able to exploit people's labor Um, uh, to, to, you know, gain in life and Dave Porter and I just looks at him and he's

1:03 like you ever been in Antucket?

1:07 Speaking of elitist places I don't know if you guys are now F1 fans but since I've been watching I mean when I was at Shell like we sponsored the Ferrari team and I had opportunities to go to a lot of

1:20 F1 races and I didn't do it then I started watching this Netflix show and I'm fucking all in man. And you know who is the biggest fan of that Netflix show? Priest Patrick. Really? Yeah. Patrick

1:32 loves the F1 stuff. Dude it is so cool because I love to race out on the on I-10 and it's

1:40 but Ferrari team won this week in Monaco Charles Leclerc who's a local Monaco citizen which I don't know what you call a local Monaco citizen I should look that up Congratulations Sean. So you'll

1:53 appreciate this my grandfather was a race car driver and growing up every time I go to his house it's just NASCAR one I mean. all day, and like as a kid, fucking hated that, right? And anyways,

2:04 my grandpa was here typical like grizzly oil-filled dude. And I was with him last year or two years ago and he's watching F1. And I was like, hey, everyone's watching F1 now. He's like, yeah,

2:18 you know, they came out with this Netflix show. And so everyone's just all about Formula One. And he's like, I've been watching this for 20 years. I was like, I know you got all the hipsters

2:28 like character all of a sudden. Dude, I'm totally. Fans. So, you know, hey, bullshit, dude. I watched Indy 500 as a kid because our local AJ - Dave Foyt. But we watched,

2:42 I thought it was so much more cool to watch these Indy cars than that. I wasn't a NASCAR guy. I didn't get it. Like, I raced NASCAR with go-karts. The Indy cars were cool. But Formula One is

2:53 like the elite of the elite. Yeah. I mean, Monaco, like if you look outside, Billionaire billionaire billionaire like it's like who has the most money or we're not a Monaco for a reason cuz we

3:05 can't

3:08 I heard the

3:11 500 was a the second. It's a repeat for the Penske team. Yeah So there's a shot So ESPN started off life as high school sports on TV on cable in the late 70s And what propelled them to you know all

3:30 sports and the the pedestal it reached at some point was auto racing That was their first big hit that kind of got him a national audience And there's a great memo by the VP of marketing talking about

3:44 should we sign this racing? Contract, you know to televise it and the guy says no we shouldn't blah blah blah. No, he's gonna watch This is like 12 pages of that and the last line is who the hell

3:57 is gonna watch a bunch of left? turns

4:01 former vice president of marketing and he is fan. NASCAR and Formula One brought to you by oil and gas. So the NASCAR, by the way, is super loyal. I was working on a startup, a tech startup in

4:14 Austin. And one of our attorneys, she was drinking a Pepsi and I was like, whoa, Pepsi and Austin. Like that isn't even a quite like, that's a Northeast drink. Speaking of Coca Cola I was like,

4:26 why do you drink Pepsi? She's like, and I don't remember the guy's name. I was like, so-and-so drinks it. So I drink it. I'm like, dude, you went to law school and you work here and you drink

4:38 Pepsi because your favorite NASCAR driver drinks Pepsi. She goes, yeah, like the greatest thing about NASCAR is not that they talk about like a driver. They talk about that damn number seven car.

4:50 Wasn't Jeff Gordon a Pepsi guy? Jeff Gordon. It's Jeff Gordon How did you know, dude? I'm pretty boy. Just fucking told you my next 24 car. grandfather. He's hardcore NASCAR. So you drink

5:00 Pepsi. I don't. I don't drink Coke's really much anyways, but there was. Oh, there was something I was going to say. Oh, yeah. Rig up. Oh, gosh. Rig up.

5:17 When they got their billion dollar valuation, you know, willing gas tech platform and Austin went and sponsored a NASCAR and had Rig up on it. And I was just like, it was funny because Rig up is

5:30 full of a lot of Silicon Valley type tech people. And I was like, here's the marketing director. They're like, how can we get in front of these redneck oil and gas workers go sponsor a NASCAR. I

5:42 see Collins and they're going to have looking down at those guys for sponsor NASCAR. Now formula one.

5:49 I mean, I'm giving credit for for Colin sponsoring a PGA tour of that. So thank you, Colin keep it up. the day we signed that contracts the day I saw so much errors.

6:04 No offense to golf. It's just that's always all right. What do we got? All right. Number one, Scott Sheffield, former CEO of Pioneer now mergers done has actually written a response to the FTC

6:20 as we reported previously on BDE. The FTC came out and said, we're not going to let Scott be on the board. He colluded with OPEC and others to drive up oil prices. Therefore, you know, he's not

6:35 allowed on the board. Scott, to his credit, didn't fight it. He said, okay, guys, this is the best interest of the Pioneer shareholders. He decided not to join the board of Exxon. I agreed to

6:48 the FTC's demands. He's written his response back and it's kind of wild. I mean, I just just saw it. But, you know, they talk about hundreds and hundreds of texts with, with OPEC and government

7:03 officials and all this. Supposedly, there's a big text thread where people send articles to each other. So these hundreds of texts are like, Hey, do you see this in Forbes? Hey, do you see this

7:14 investor presentation?

7:18 He says in there there were that when he went through all the texts, there were two texts with other oilmen, one was Brian, his son. And the other one was a CEO of a small EMP company that said,

7:32 Hey man, congratulations on the deal, you know, and so he said one other thing and then, then a fire away. You know, you said the FTC interviewed him for four hours. They never asked him about

7:47 any of these statements And it seems like this whole thing on collusion was really two things. Number one, it was investors saying capital discipline, you know, and so Scott sitting there talking,

8:02 you know, hey, we gotta be careful capital discipline and all. And then the second thing is after the, you know, after the pandemic, so minus37 oil, Scott did organize a group to try to go to

8:18 the railroad commission and say, hey, we need, you know, extraordinary measures here, limiting production, whatever, which is all public, which is all, yeah. It's all public. There's a

8:29 public hearing on Twitter. We had a watch party. We watched it live and we're tweeting about it. Like that was all public. Yeah. And there was, there was one, there was one tech supposedly to

8:41 an OPEC official of some sort of saying, hey, we're doing this. This is the time of the meeting. This is when we launched Bropeck. Bropeck died. Yeah. We actually got it. The Department of

8:53 Energy thought it was funny as shit. And

8:59 the whole idea for Bropek was to get American EMPs on the same page for Capital Discipline and stop drilling. And so, be really funny. If someday that comes by me in the ass, was like, Oh, Colin

9:09 was trying to colludeand raise oil prices by launching Bropek. Like, it's honestly like on the kind of the same level of absurdity to be honest. He was clearly trying to collude with

9:21 this fella, Alberta Garbage.

9:25 That's the Canada coming together. I mean, this is just ridiculous. I'll go on the ramp and then I'll shut up 'cause I've ranted enough about this. But, you know, I mean, I forget when we hit

9:36 trough production in America, '09, '10, '11, wherever it was. I mean, and we doubled oil production since then. And the rest of the world didn't grow any production except the Russians and the

9:51 Saudis. But the whole rest of the world didn't grow production We'd have had 150 in.

9:56 or200 oil during that period without the shale revolution in America. Where's the fucking FTC saying, Hey guys, thanks for that. 'Cause you know who it was? It was a bunch of investors that took

10:07 a lot of losses. I haven't calculated this, but I guarantee you, there was no net income generated in EMP world in the United States during the shale revolution. Private equity broke even in best

10:20 case. The biggest bull run in the history of the United States is subsidized by the private markets, investing in cheap American oil. To the benefit of consumers. Yes. Which is

10:36 the Jack Nicholson line from a few good men. I'd rather you just say thank you, if not, grab a post. Yeah, that's right. Anyway, so I think this is just bullshit. So

10:49 in this political season, which is obviously a presidential election, Where does this go?

10:56 You know, I mean, you'll have Biden running around. I mean, I hope this doesn't happen, but are they gonna threaten legal action against Scott? Sounds like the forensics of what was actually in

11:10 the base of evidence defined as these text exchanges is pretty flimsy. Sounds like he's getting railroaded, is what I mean. That's it. So it was a text chain that a number of industry participants

11:23 were on and they sent articles around It sounds like some of the

11:30 recipients actually read those articles. Yeah, who knows. Well, the thing is, when we talked about this a couple weeks ago on BDE is that the FTC, the head of the FTC, Lena Kahn, I think is

11:39 her name, she's hated by Silicon Valley and tech right now too. So they're not making any friends and energy or in Silicon Valley and so she's blocked a ton uh, mergers and acquisitions and tech

11:57 and this crumbles, it crumbles with the entire Silicon Valley ecosystem because you need pass to liquidity. You need acquisitions or else no one's going to build tech. Like if, if that's the

12:11 precedent that you're setting that, hey, you can go out and you can create these big companies that create value for society and for shareholders. But when the time comes, you don't have a path to

12:23 liquidity that

12:25 undermines the entire capitalistic nature of the United States. When you threaten criminal prosecution against industry leaders that do great things like the shale revolution, guess what? They

12:40 don't do them anymore or they go elsewhere. It's just stupid. Yeah, this has really bothered me. The weaponization of the judicial. But I think what I was getting back to. Justice Department.

12:54 Mark's question is, you know, is this going to be politicized coming into election season? I don't really see that because I just see the FTC doing these things across the board. So I don't think

13:05 they, you know, have some heart on or hell been on coming after oil and gas. It's enough red meat for their base. I mean, hey, look what we did. There's another huge story that the just

13:16 department is involved in. And the headline is, Guy and his president welcomed Chevron's bid to buy into the150 billion oil project.

13:27 You've got Chevron in the HES merger. You've got Exxon claiming that they get the original rights to this province in Guyana. What's going to happen? Because Guyana's president Guyana is like, Hey,

13:41 Chevron, come in bid on this stuff. And the Guyana, the president's like the biggest rock star on the planet after just bitch slapping that BBC reporter, I

13:51 mean, right. who's going to win. And the, I mean, Exxon's got its own issues. You've got Chevron Hesse merger, what's going to happen? What's going to play out? And then you've Guyana being

14:01 the, the, the, the reason why they're fighting. So, so, so a, a X Exxon land man, though, who's, I'm a non, that sounds so sketch. What's a Twitter handle? It gets at the same reaction.

14:17 It gets worse, who's in a non on Twitter. Of course reached out and we actually chatted on the phone about it for a while. He said, he said, I have not read that exact JOA, but he said, I know

14:31 exactly how we wrote all of them. He said, one, it has a rover in there. It just does. Exxon didn't do one without it. He said, number two, it's Ironclad. So he's 80, 85 chance Exxon wins in

14:47 an orbit. And I think the history was, if I'm thinking back on that conversation, was. when they first had JOA template in

14:59 '70s. In the '70s, they updated it or revised it, amended it, and the '80s to Conemplator include merger, the notion of corporate mergers. Yeah, 'cause in the '70s, that's how you got around

15:13 all the, the, the, the road for - So are we calling it on VDE? Yeah, Exon wins. All right, that's big And so one of the great things, when I had constitutional law back at Rice, this guy

15:26 didn't show up and he and I tied for the highest grade in the class on the final exam. And Doc C, who's my favorite teacher of all time, looked at me and I'll just call this guy John. So we were

15:39 sitting there and he goes, All right. And Doc was deaf, so he kind of talked funny. And Doc tried, All right, you two, Chuck. You at least showed up. and I went down to the bookstore and you

15:49 bought the books. I don't know if you read them, but I understand you're great. John, how the hell did you make this grade? You never showed up for class. You didn't even buy all the books. And

15:59 John just looked at Doc and said, hey, Doc, it's constitutional law. The feds always win.

16:07 So Exxon always wins. We can just say that. So I'm thinking about, there's gotta be a reality show. We gotta, it's gonna be a digital Wildcatters-backed reality show, it's gonna have Darren

16:16 Woods, ExxonMobil, Mike Worth of Chevron, John Hess, and then we need our boy, Scott Sheffield in there. What's the show gonna be about? I'm their butler.

16:29 Are there drivers or something?

16:34 I don't know what that, I don't know. But who can take over more land or, you know, Scott, he's like, it's gonna be something.

16:42 I think this is going to be not this is not going to be even better. They're rating places to reality show. Oh, that'd be funny shit. Yeah. That'd be awesome. Either that or it's Game of Thrones

16:52 in the Permian Basin. I would want Darren Woods to take over CEO of BP. Oh,

16:59 damn. Yeah.

17:02 You know, that's what I was at ex on this campus a while back in a couple of, you know, you had a group of young people there and they're like, Hey, we want you to come do a talk on ex ons campus.

17:15 And

17:17 how did they come to ex ons campus or do a talk about ex ons? No, come to ex ons campus and do a talk to like a couple hundred of their employees and they're like, we want you to come do a tonneck

17:27 or this. This might not have been in verbatim, but ultimately, like round toast. Colin, if you're a CEO of ex on, how would you come in here and fuck up the company like in a go away? Like,

17:37 yeah, like just completely. Yeah, disrupt it. Yeah, not fuck it up in a bad way, but just like, shape things up. Hard Jeff Gordon to drive through it. Jeff Gordon's gonna be COO. They got

17:48 the cars in the, in the campus already. All the old memorabilia stuff was cool. No, it's cool. Yeah, it's cool, it's how the - Yeah, that's campus is so bawling. They sponsored a car that was

17:57 in, I believe days of thunder. Oh, no. Dude, wait, wait, wait, wait. Whoa, you just heard Colin say something. Exxon's campus is so bawler. No, it's, it's - Who wants to go to - It's

18:10 true, man, if they would let us, if they would let us go out there with the camera for like two days and just shoot all that. Every, nobody would want to get a solo camera Let me tell you

18:18 something. I've been there, Aramark, great. The restaurants are just like any Aramark. I mean, I feel like I'm in any other stadium, any other big company, but that's the problem with these

18:31 mega campuses is that all you see is your fellow people versus going and seeing other people you interact with and in. getting good ideas. That's one of the challenges is that it's all the same

18:43 people that have met with the same culture. Yeah. There's no innovation because they, oh, it's Chuck. We think the same we. Well, you know, I don't, I'm gonna push back on that a little bit.

18:53 Try to. 'Cause like, when we walked in there. You're wrong, Chuck. I mean, the head of MA was sitting right there and he had like - The collisions that happen were crazy, yeah. Yeah, I mean,

19:03 people wanna go out to that campus and so they're inviting people on. Okay. There's more interaction Let me step back and ask you just one question. Do you really wanna go on that campus? 'Cause

19:13 the moment you hit the campus and it's about 30 miles from the entrance to the actual parking garage, you're on camera and they monitor your speed. 247, yeah. You like that? I got a ticket for

19:26 not holding the handrail one time. Yeah, I did, I did, sure. I can't even, it takes me an hour to get from the campus to the inside. Yes, but, but, all right, hear me out here 1. Exxon is

19:37 fucking god. royally by not letting us come shoot a podcast in the remote operating center. They are controlling, I think it was 12 deep water drill ships all around the world from one room,

19:51 steering the bit, not just making decisions. They're actually steering the bit. And so in the room, you got, you got your Halliburton, your slumber J, your NOV teams, all there, like it's a

20:01 service room on an offshore rig. And it's absolutely mind-blowing. And I'm like, hey, y'all need to let me come record a podcast. So I know they won't let us do that. I'm like, hey, if nothing

20:10 else, let us record it so that your employees internally can see what's going on down here in the end. I know they won't let us do that. It's like, why would you not? Why would you not tell that

20:20 story? One of the most complex and technologically advanced operations and you don't want to talk about it. You know what the singular thing, I found most impressive about us being in

20:32 that room. The technology was awesome and all that. Exxonhead, service, providers service companies cooperating with each other across rigs. So like - Because that's how it happens on a fucking

20:46 Offshore rig. This is what's so crazy to me. This drill ship just sees something. They're telling the other people. Yeah. And that's what our industry needs, more. But that's what happens out

20:56 on rigs. Like you go out to an Offshore rig, you have a service room and all your service providers are in there. And how many durable oil field patents are there? Yeah, right, and how much fast

21:09 following of things like completion techniques and. Yeah, I mean, the entire industry is fast following. Yeah,

21:18 ultra fast following. Well, but the probability of that actually ever happening is about the same level as Mark Andreessen responding to the Chuck Steenhouse. Now I'm art. He's like, Some Aynon

21:32 keeps like hitting you up

21:38 I will say based on not so recent past experience, Kirk's right. Yeah. Fair enough. Saudi Arabia has announced that they're raising another 10 to 20 billion in fresh Aramco stock. Interesting.

21:53 The country's running out of short-term cash because they're building a mega city. They're building an airline This is the mega city they're selling. They're taking over the world of golf.

22:06 There's something else they're doing that's pretty interesting. Oh, they're trying to like build like a chip manufacturing plant. I'm curious, like

22:16 a Ramco needs cash. So in the golf world, as I spend a lot of time in, they're like, you know, Saudi Arabia has unlimited money. The piff. I'm like, they do have a lot of money, but you can

22:24 also spend all that money. Clearly, well, if you,

22:29 if you look at the demographic of the population, it's pretty young.

22:34 relatively high kind of social cost burden. So that's the

22:39 thing that was never talked about over the course of long history of OPEC and particularly Saudi discussions is that, now I remember the drowning in oil cover of the economist and they talked about,

22:50 you know, Saudi cost of production and5 a barrel. It's not really because there's so much stacked on top of that. So many benefits and handouts. Well, it's paying for political stability Right,

23:01 right, so that hasn't changed.

23:05 I wanna talk about, let me do this 'cause you're an engineer and you're gonna be able to explain it. So I'm gonna tell you what I heard. If it's 10, 000 feet underground and I can't see it, it

23:16 may be so. There you go, perfect. So Trinity Gas Storage had me out to talk to their user meeting and Trinity's building the, and it'll go operational before the end of the year. Big gas storage.

23:33 facility, the first one to open in Texas in 10 or 15 years, something like this. And they had all the participants, customers, vendors, all that out to play golf and just kind of have an update

23:46 on the project and they had me speak and I scared the shit out of them and said, we're not going to be in the natural gas business in 10 years unless we learn how to sell electrons. That's, we'll

23:57 talk that story at some point. But it was interesting what I heard from natural gas guys and I'm a booger this all up marks or translate. But supposedly the natural gas coming out of the Permian is

24:10 like 3 nitrogen, which doesn't run efficiently through our LNG export facilities like Freeport, etc. And that's what's causing a lot of the delays in the downtime of Freeport is having to process

24:30 the nitrogen and I mean, yeah, Cryo can get the nitrogen out of it, but at the end of the day, that's a lot of capital. And so it's really discombobulating the economics of LNG exports and

24:46 supposedly this is a really big deal. I haven't seen a lot of articles about it or Twitter stuff about it, but the guy says this is gonna be the big narrative kind of for the rest of the year. I

24:57 just pulled an RBN piece from last September, I think September 27, Rusty Brazil's firm or BN Energy. And it's on this topic, of course, it's behind the paywall in terms of the details, but the

25:11 gist of what I could get from the abstract was more about what more nitrogen takes up more space in liquefaction that would otherwise be occupied by value methane. And so it lowers the heating value

25:25 ultimately of the cargo, so it puts more pressure on your economics and we can talk about something else that's putting pressure on LNG economics, but I haven't dug into the technical details around

25:41 the cryoprocess and liquefaction if there is something. Do know that the nitrogen content of the Midland Basin where most of the recent growth has come from is highly variable. So it's a bit all

25:56 over the map on a well level basis or a lease level basis, but yeah, I think it's more of,

26:04 more of an economic issue of, look, I've got to have 100 of that space or as close to 100 of that space with value product to find this methane. The other things that were said

26:14 is just, as we're getting into more tail production of oil,

26:31 I mean, we've reported on this that the wells are just becoming gasier and the gasier wells later in life more nitrogen showing up in there So that was another thing said. your economic point, it's

26:34 like, their supposedly is operational issues with 3 nitrogen. It just doesn't work. And so, free ports supposedly trying to just drop the nitrogen out by having it run. I don't even know what

26:49 that means. But the talk is, call it 500 million or a billion dollars worth of cryo type stuff necessary. And that's really discombobulating economics. Not much of a chemist, but I think because

27:05 it is an art, it's really hard to deal with. It doesn't react to anything. Yeah. So, don't you think the finance guys would have figured this out about the content of the Permian? Well, I think

27:15 when they were

27:17 changing it's changing because it's the new drilling is finding more nitrogen as well as the later in life tails. And it has more nitrogen. So, all this gas showing up is different than what they

27:31 planned for. Supposedly, the plants that have been approved, but aren't yet, haven't started construction, have taken this problem into account, but the existing infrastructure supposedly has

27:46 some problems there. So I may be wrong on this, but this is kind of what I heard from out there. Yeah. So I was on a panel last week for the Society of Petroleum Engineers to talk about AI. Let's

27:57 go.

28:00 And it's funny, 'cause there's an article that has come out talking about how Google's AI says that it's healthy to eat one rock a day. Some people say that running with scissors is safe. Wait,

28:12 wait, did you see all in the one where it said it was healthy to eat one rock a day? One of the sources was from ResFrak, which is a friend of ours.

28:23 Mark McClellan over there, I meant to send it to him, but it used to ResFrak as a source, and I was like, That's funny, that's some oil and gas technology. In order to get cheese to stick to

28:31 pizza, 18 of a cup of non-toxic glue. So I was talking about collide. I was like, one of the, and let me know if this is accurate, but I was like, collide's amazing because there are no

28:45 hallucinations. And that's a really big deal. I mean, and the hallucination is stuff like this, like it's healthy to eat a rocket day, like that. I'm gonna tell you what's really happening here.

28:57 And it's not that collide doesn't have hallucinations, is that it has energy specific content that it is trying to go in there and find an answer from. What's happening on Google right now is they

29:09 just signed this huge deal with Reddit to feed their model. And so all of a sudden you have every single shitpost that's ever existed on Reddit feeding that thing now. And this is like, this is,

29:24 I've seen this when they started announcing those deals as like, How are you going to,

29:30 how are you going to. determine which information and the Reddit knowledge base is valuable and not valuable. How are you going to QA, QC, and

29:40 deal with some of those same problems that non-collide as well, but our problem is much smaller because we're focused on energy-related content. But it's interesting to see Google's entire

29:53 businesses becoming broken now and just see a company that's been as dominant. And they don't care. And it seems like they don't fucking care. So what makes give me some a couple examples of like

30:06 the power of collide and what your AI has been able to do. Yeah, so I posted this example the other day I was sitting in here with a couple directional drillers and they were just like geeking out

30:17 on it and they asked a question that says, I'm stuck in the hole. What do I do now? And collide GPT said, All right, if you're stuck in the hole, you need to start working your jars like this.

30:28 Gave step-by-step instructions on how to get And the guys are like, Holy shit. They're like, That's

30:36 accurate. And then I go to Chad GPT and I say, I'm stuck in the hole, what do I do now? Chad GPT had no contest of what I was talking about. I thought I was stuck in a mud hole in my car. So

30:47 it's like, okay, you need to turn your wheels to the left. And so, one, our bot already has a contextual understanding that this is related to energy. It's got energy-specific content that you

30:60 can get right answers like that. And so what's been interesting is like, I have some production engineers that are just beating the shit out of it right now. I mean, asking like super tough

31:09 technical questions. And they'll compare that to co-pilot or Chad GPT. And Clyde will get the answers wrong, but even when it's wrong, it's still more directionally correct than co-pilot and

31:24 Microsoft and, you know, like it'll return And it'll be the right formula, but it'll transpose one of the variables and put something else in there. And so,

31:33 you know, it'd be like, those are the things that we're working on or not right now. It's fine tuning it. But the problem that you're having the internet, when I saw Chad GPT get released year

31:44 and a half, two years ago, my first thought was this changes the way the data and content is structured on the internet. And, you know, the reason that Chad GPT was so good at coding was because

31:54 it was trained on Stack Overflow's coding knowledge base. Which also has people, it's the communication between the different developers talking about why they've come up with this code. Yeah.

32:08 That's what's real. It's the context. Had a lot of context and created this deep brain. That's the same thing that we want to do for the energy industry. But yeah, you know, I was talking to VC

32:19 who just thinks that, you know, Reddit's going to be the most viable tech platform. since going IPO and I look at it and I'm like, Man. There's a lot of shit data in there. There's a lot of shit

32:30 data in there. You ever been on Reddit before? Holy shit, there's some stupid people on there. I think that was the, we had a perivator guy. We had Nvidia on this panel and then me, of course.

32:39 I mean, me and Nvidia, which I've fought with Nvidia, I have a good story there, but I'm not gonna talk about it today. What's interesting is they all came to conclusion that shit data in, no AI

32:51 in the world can help you if you have shit data Yeah, and that's sort of the underlying rule always with software is if you have shit going in, you're gonna get shit going in. I mean, that's where

33:01 we spend a lot of our money right now is on data ingestion. How are we embedding this information, chunking it,

33:09 and then there'll be even more. Do that rule alone is a foundation in context. That says that Reddit basically is 98 bullshit, you know? 'Cause every Reddit has the most people are like, Well,

33:22 two things though on AI, so I'm reading a book. uh, called co-intelligence right now and it's business school professor in layman's terms kind of walking through reading or listening jock. I'm

33:34 listening. Okay. I'm in the car a lot. I know you are just anyway. So, um, two things that I didn't appreciate that, uh, that y'all say no shit Sherlock, but, um, two things I didn't

33:48 appreciate is one. All AI really is kind of probabilistically choosing what the next word will be. That's what a language model does. A language model sees, you know, sentences and phrases and

34:04 stuff and gives it weightings. And so then when it's later asked something near that, you know, there's a such and such probability I choose this. That's why it's different every time you ask a

34:15 question, etc. But

34:19 it can't tell whether something's a lie or not true or false. doesn't really handle humor, although it's getting a lot better at that. So kind of those subtle things. The second thing that this

34:33 guy makes the point on that I think's really, really important is he says, assume the version of AI you're working with right now is the worst version of AI you will ever work with in your life,

34:46 'cause it really is getting

34:49 better, kind of every day. But back to the kind of root point, if you're building that contextual foundation on garbage. Yeah. And contextualizing

35:02 is - Which is interesting if you go - Given the, yeah, if we go back to the whole line, if you're stuck in a hole, one would argue, I'm gonna get all the data sources in the planet to give you a

35:12 good answer. And what Clyde is saying, no, no, no, we only source from people within industry. I don't know if we're checking all credentials, but this industry is very clear of, you have to.

35:25 come in with experience and there's been companies that have come in that had no experience in oil and gas, but had all these math models and these things that would predict, you know, flow and all

35:38 this bullshit for shale that were wrong. Yeah. Because they didn't have contextual experience. And that's something that's really important. Why probably collide is going to be a better platform

35:49 than anything. Well, the asset class is different, too, and that the model that you're dealing with is not something you built with precision. I'm talking about the subsurface primarily, right?

36:00 So there's all kinds of important contexts that you pick up as a deep specialist on the fly, because it's your first experience with that. And it's some curveball that Mother Nature is throwing you.

36:14 So I don't know if it drops tomorrow or if it drops next week, but in the next couple weeks, I had the head of AI for Intel.

36:25 We recorded a podcast, what's fascinating is, there are very, very smart people, people he respects on both sides of this argument. There is one argument that ultimately these massively trained

36:42 language models that have just been trained and trained will ultimately be the panacea for everything. So you will ultimately get a better answer Today you get a better answer out of collide about

36:55 how do you pull out of the hole versus a massive language model today, but ultimately the massively trained language model and everything will win out. Really smart people thinking that. Equal

37:07 numbers of really smart and respected people are the other side. No, we want specific small databases to handle specific problems and it'll be like the cell phone companies there'll be like three or

37:20 four big massive language models. But ultimately it's going to be the specific

37:29 subject matter type stuff.

37:33 So anyway, it was fascinating to talk about that. Because that has massive implications for energy use. If we're going to have a million massively trained language models, that's a lot of energy.

37:46 If we have these small specific little models with databases, a lot less energy So anyway, there you go. Yeah, it's a good one. All right. What else on the agenda, Mark? Well, let's you raise

37:59 it when we came in the room. Let's talk about the transportation secretary and his.

38:06 His discussion on what's going on with the massive EV charger build out. Yeah, I was on CBS's face the nation, but host Margaret Brennan asked secretary. Pete

38:21 Buttigieg How do you explain the utter failure this far?

38:28 of the Biden administration to install just seven or eight high-speed EV charging stations in three years, despite having a massive75 billion of money to do it. Well, it didn't have a good answer

38:36 except the fact that he said it's really hard because you actually have to dig into the ground and you have to be like a utility. Yeah, you don't, you don't just, his words, plunk these things

38:49 down in his, his ultimate non-answer was, well, you know, we're targeting half a million of these charging stations by 2030. So here's my question. Will it momentum has gone backwards on EV car

39:05 sales? We called it first here, by the way. We were at least a month ahead of the entire industry, the world talking about how EV car sales

39:15 are stalling.

39:17 Great. We build, I mean, There's seven to eight government bill. EV charging stations. Let's say there is a half a million, which there's no way based on the

39:27 government's current capability, but let's say they build 500, 000 chargers. Will it be too late?

39:35 Or is this just the pause in EV car sales? I think until we get grid figured out

39:42 and we're doing things like threatening massive tariffs on competitive alternatives. Then I think it may be temporary, but it feels pretty structural at this point. Yeah, it's interesting. I mean,

40:02 this will be real interesting to see the next five years play out. Yeah, no, 'cause one of the things I said in that speech to the gas storage folks was, I truly don't believe the existing utility

40:16 players are capable the big problem solving of

40:23 the world where we need tons and tons more electricity. Well, there's a structural issue with utilities by nature. There are monopolies that. And all the regulatory bodies surrounding it that

40:35 governs electricity has the same exact mindset regulated monopolies, correct? So my question is, I guess technically an LP in

40:46 the IRA to the GP that made the decision, why'd you call capital so early?

40:54 'Cause I can charge management fees. 'Cause there's overhead, hell yeah, exactly. Bureaucracy. Speaking of costs, I want to go back to LNG. There was a fairly, I think, important event in the

41:09 form of Zachary, which is a legacy engineering construction firm based in San Antonio.

41:19 They're 28th on the top 400 contractors list. They had revenues last year of 54 billion. They filed for chapter 11 due to looming and solvency issues related to the Golden Pass LNG project, which

41:32 is 70 owned by the Qataris and 30 by Exxon. And so, you know, they're citing everything we've heard about other energy related projects in particular and the viability of those, which are

41:47 inflation, cost overruns, material costs, et cetera, et cetera. And so they're,

41:55 you know, they quickly dug themselves a whole because they're having to pay for things unanticipated. And then as I understand it, changed to the completion schedule timeline. So there was a lot

42:09 of pressure to accelerate things. They're one of three contractors on Golden Pass Chioda's one and I believe McDermott is the other. And so activity is continuing, but I just think that I'm kind of

42:22 thinking about this ramp up of LNG liquefaction projects

42:31 that we've talked about in the context of the Biden administration pause on new permits. I thought it was interesting that John Arnold tweeted out last week that basically we're talking about

42:45 something meaning the pause being good political theater, but in reality, it's just not all that impactful from a financial decision or investment opportunity standpoint, and so he had some good

42:59 stats in there. We've got 14 BCF a day of liquefaction, capacity operational today, 17 in permit or permitted an under construction. So you're at 31 BCF a day Another 15 BCF a day. has been

43:17 permitted and not yet in construction. And then what's really affected by the pause is about 11 BCF a day. So his point is, look,

43:28 there's no financial incentive to get involved in these very long horizon ideas or concepts beyond what's already been permitted. In fact, we've got, I believe I can infer from his view, we're

43:44 just never, we're never going to get to

43:49 kind of a rational

43:52 completion of what's already been permitted. And so, I think there's a looming sunk cost risk. You know, we'll see. We've talked about it as before being the pause being because of some

44:08 alternative supplier stepping in and talking about agreements, long-term off-take agreements

44:16 the US. acceding market share, I just think it has a lot of interesting things to think about as it relates to the gas market, et cetera. I mean, you're talking about, you're taking, I mean,

44:27 one of the most volatile commodities in the world, I mean, gas, I don't know if it's second to oil, but it definitely is, well, actually, it's probably not even close to second because it's not

44:38 variable. However,

44:41 you're making long 30, 50-year bets on a commodity that changes, but there's always been this bet because of the shale revolution that we're long gas, which I think we're all here saying, of

44:54 course, it's been playing out over a decade. Yeah, we're long gas. That gas is going to be valuable in the rest of the world because no one else can get it out of it cheaper. No one has

45:04 discovered in Europe and Asia. So in some ways, it makes sense. You got to build as many, you know, I think that's what a lot of these big money said, we think that's worth We'll go try to get

45:16 off, take agreements to, you know, to fund the sunk cost, which is the development of these projects. It makes sense, but what doesn't always happen is the political risk. And there's been a

45:30 lot of political risks that slowed these projects down, which might make these projects underwater. Well, not to mention it. And bankrupt EPC companies. And I think your market share thing is

45:43 real It's not a BS made up thing, 'cause I'm starting to dig into the Beadaloo Basin. I think that's how you pronounce it in Australia, you guys shale US got You've. one that following all been

45:53 We've - got you've, mean I.

45:54 know, who was one

46:01 of the first to get over there and start stirring the pot on this? Aubrey McLendon. Of course. Over there, I mean, I think there's been half a billion, billion dollars, Pest was messing around

46:14 in it. You had Aubrey messing around with it. You got a company now, you know, you've got various other shale, US. shale people, more to come on this. But that thing could be bigger than the

46:28 Marcellus.

46:30 There's a lot of gas. There's a lot of gas over there. And if we allow - Especially after Tex-Max, there's a lot of gas. But if we, you know, if we put a break on LNG, we don't sign up

46:43 customers, they're gonna look elsewhere. And they're going elsewhere. They're going elsewhere. In Middle East, we'll take it. Okay, I have a question. I'm gonna put you guys on the spot. I've

46:56 been, it's summertime, so I like to read a little bit more, you know, about relationships, things like this. Okay, great. But I've been reading about this relationship that just baffles me.

47:07 It's the Rockefeller fortune.

47:12 Randa Kaiser, she was busy raising her children in Florence, Italy, which probably does. When her brother presented her with a dying wish almost five years ago, he had terminal brain cancer and

47:24 he asked his only sibling to become the new standard bear for the campaign he'd started against Exxon. So the Rockefeller family's been fighting Exxon because they believe they've been deceptive

47:36 about climate change and the responsibility for its consequences So I'm just curious. Your five generations and gonna be probably forever wealthy because the wealthiest person on the entire planet

47:53 created standard oil, which many will credit in saying, standard oil, Exxon is standard oil. The most likely. Sanjay. So you're fighting, your family's inheritance and wealth came from oil and

48:07 gas And now your fight and what you're spending resources on is invite what your ultimate heir, what your original, the original founder, Rockefeller started. Give me your what? You have kids. I

48:23 have kids. This makes perfect sense. Right? I mean, my kids at all vote to get rid of hydrocarbons. I'm like, you do realize that you're living the greatest life on the planet of anyone because

48:34 of hydrocarbons. I'm just baffled. What do you think, Mark? It baffles me as well, but I understand it because we have kids. Right. Yeah. That's the explanation. Yeah. Totally. Well, it's

48:51 a bit exemplified by what we just talked about is there's

48:57 billions allocated to doing something that's really hard, technically and mechanically, but that didn't stop kind of the build of euphoria and more importantly. fundraising in the form of taxpayer

49:16 supporting something like the IRA to charge off no pun intended on building half a million charging stations in the expectation as you can do that overnight. And it's like what we're seeing with the

49:31 pure play EV up starts that are now teetering on on extinction is that you know after Thinking about translating things to the physical world and actually doing things building cars is hard. And so

49:49 there's a big gap in terms of kind of the practical understanding of what all this means and I'll tie it back to all of the linkages that you just cited to the lifestyle that we have today But you're

50:03 so outside of the everyday experience that you get into a political echo chamber that you have the luxury of spending all your time at. live in great times, that is the answer. We live in such a

50:19 great time that our kids can say, I reject, hey, first of all, thank you for the money, Dad. I'm gonna spend it the way I want to. And by the way, I'm gonna spend some of my money fighting and

50:31 erasing your legacy. We live in great times. I have just a bit of a sidebar, but I have to solve the funniest bumper sticker I've seen in a long time. And you rarely see them now, but there was

50:47 this tricked out, jacked up excursion. Oh, remember the Ford excursion? Who doesn't, yeah. Bumper sticker. I identify as a Prius. Nice. Touche. Nice. There's actually a great book that all

51:04 pimp, it's called Factfulness The short version is Swedish doctor. uh, traveled all around the world helping out sick people in poor areas and actually came away with, you know, the world's way

51:19 better off than it is. And so he pulls all this UN data. Um, and he created a test with 13 different questions. ABC were the answers. He routinely would get and questions were like, what's the

51:37 average number of years of education that men have versus women? And, you know, that everybody assumes, Oh, well, men get 17 years of education and women get one, you know, that the world's

51:52 that better off? It's actually like 10 and nine. So his point is he would give the, this, this quiz to UN, to bankers, lawyers, all these really smart groups and routinely the average number of,

52:08 of questions that people got right were one and two. So if you were a random monkey, you would get four, right? You know, if you were just randomly choosing, but the point is the world is in

52:20 much better shape than we all realize that what we define as poverty today is what's rich in 1900. So hydrocarbons have done that. Let's end on a, on a summer focus note. What are you guys doing

52:36 this summer? Any travel plans, anything fun? Where are we going to spend our oil and gas revenues this summer? So I am actually going to go to Australia and with a cameraman and check out the

52:53 beat-a-loo basin. And I'm going to come back with footage. I will be in, I will, I will start my adventure in Darwin, Australia. That's my big trip for the summer. Damn. I've got a couple of

53:06 things.

53:08 after your hiatus to my north of the border, while I fishing excursion up in

53:18 Ontario, which is, so I'll be

53:23 burning some

53:26 gasoline on the fast pontoon, and

53:29 then I am gonna be - What are you fishing for? While I pike. While I pike. Best eating freshwater fish there is in my opinion, but it's more about the shore launch and the shore launch martini,

53:41 but

53:44 also burning some jet fuel, returning to Europe for mostly an international baseball tour. Gonna get to see the sun's flying in Europe. Yeah, we're playing, there's three city stops. Prague is

53:59 first, Vienna. The second we wind up in Munich. Yeah, that is fantastic I'm head to Scotland. course, course. Got a check on the technology to patch you in. Yeah, please do. And then I'm

54:15 going over to Scotland and placing golf. Nice. So it's my first Scottish golf trip. Even though I've been there a lot, I've never actually brought my clubs. This is time it's going to be all

54:25 about golf. So I'm excited. Yeah, I went to Scotland when I was in college and we made the trek all the way to the Loch Ness. Yeah. And we may or may not have had some roadies on the way. So you

54:40 saw Nessie. I saw Nessie. So are you playing Trump International outside of Aberdeen? No, but I stayed there when I was back at Shell and I got ratioed. Everyone, of course, all the Dutch were

54:54 like, they could not believe I stayed there. They were like, you are the worst person ever. I was like, it's amazing. I'm in a castle and no one's here. It fantastic. I was like, I had the

55:08 whole run of the place. So I played there five years ago. And the kind of the tension is their attention is pretty palpable. But at that time, I don't know if it's changed. There was a massive

55:25 Scottish flag flying that was outsized in terms of regulation. And apparently they're getting fine daily. For every day they find that fly that flag. I don't know if it's still flying. And the

55:39 other was, I think they're the Scottish flag anti Trump or pro Trump. Well, he's or he's or Trump is flying it just because he just in defiance of this is, you know, I want to fly this big, this

55:53 very, very big Scottish flag. And you see it all over the course. The other one is, and I don't remember exactly the orientation, but There's a

56:06 homestead built up on a bluff that I believe they planted some trees in front of to block the view. Okay. And so those trees were looking sickly when I was there and the owner had erected a super

56:23 tall flagpole on top of which he was flying the Mexican flag.

56:28 Love it. That's awesome. All right. Thanks for tuning in this week. Everybody wish me luck I'm having nasal surgery tomorrow, so I will be out of commission, but hopefully I'll be able to

56:40 breathe again. If you enjoyed the show, pass it on to a friend, give us a good comment and we'll see you soon.