C.O.B. Tuesday

Today we had an absolutely stellar guest for our COBT discussion, Howard Newman. Howard's career in energy and financial services has included 15 years at Pine Brook Partners, 22 at Warburg Pincus, 10 at Morgan Stanley, and over 45 board roles. His knowledge and perspective are difficult to match and his friendship with us is something we are most lucky to have. As you will hear in the discussion, our topics ranged from private versus public investing, terminal values in classic energy, US drilling inventory, charting the energy transition at the Board level, LNG, nature-based solutions, and of course, what does the energy world look like in ten years? It was a tour de force summary of learnings from all the things Howard has seen and done in his ongoing trailblazing career.Mike Bradley started us off with a discussion of the markets this past week and year-to-date. He also touched on the BP earnings call from this morning as well as some recent comments from Blackrock on oil and gas investing. Colin Fenton attacked two key topics today. First, we leaned into the data on oil as a hedge against inflation. It's a meaty topic for a five-minute overview, but Colin did a masterful job of analyzing the data. Second, Colin looked at the current condition of the oil market through the lens of futures prices and their presently low volatility. The upshot is the oil recovery most likely still has several years of room to run, despite the speed of the advance to $90 WTI. But as you will hear, we try and bracket this positive outlook, and perhaps temper enthusiasm somewhat, given the occasional large bumps in the road very likely to be encountered over the next 24 months. You will also hear Howard Newman pick up that balanced perspective and discuss why, how, and when capital will return to the oil and gas industry. 

We are deeply honored that our first Veriten COBT guest is Secretary James A. Baker, III. A native Houstonian, Secretary Baker is one of the most accomplished and insightful leaders in the past 50 years of American history.It is undoubtedly difficult to neatly summarize Secretary Baker's accomplishments and contributions to the country and to the world. Mr. Baker served as White House Chief of Staff for President Ronald Reagan from 1981 to 1985, before moving to Secretary of the Treasury from 1985 to 1988. He was President George H.W. Bush's Secretary of State from 1989 to 1992, during which time the Berlin Wall fell, German reunification came to pass, and the Soviet Union dissolved, bringing an end to the Cold War. He served again as White House Chief of Staff and Senior Counselor to President Bush from 1992 to 1993. Altogether, Mr. Baker led five presidential campaigns for three presidents and was a trusted advisor to a fourth. Prior to his time in Washington, Mr. Baker graduated from Princeton University and served in the United States Marine Corps, received his law degree from the University of Texas at Austin, and practiced law in Houston at Andrews and Kurth. In 1994, Secretary Baker founded Rice University's Baker Institute for Public Policy which is one of the nation's and the world's leading nonpartisan think tanks. He is presently a Senior Partner in the law firm of Baker Botts.It was our distinct pleasure to host Secretary Baker at Veriten's offices, located at the ION in downtown Houston. In our discussion, we touched on the state of the world, the state of the energy and climate discussion, Ukraine and the issues around it, and other domestic issues including the national debt and inflation. Mr. Baker's knowledge, perspective and humor were encouraging and insightful. At 91, he is still sharper than ever. We are beyond thankful to have spent the time with him and hope you enjoy our discussion as well.We had a quick lead-in with our Veriten team members Mike Bradley and Colin Fenton. Mike shared a timely market update on the outperformance of energy equities relative to the S&P 500 index. He also shared his expectations about this week's OPEC meeting in light of recent strength in crude oil markets. To frame our national debt discussion, Colin gave an overview of the key data and showed how the massive surge in public debt fuels the inflationary pressures that policymakers have been slow to recognize.Thank you all for your support and friendship. We extend you a warm welcome to Veriten and look forward to everything to come. We are so excited!

For our first COBT episode of 2022, we had the great pleasure of hosting Rob West, Founder and Lead Analyst at Thunder Said Energy. With the ongoing crisis in European gas markets and the tense uncertainties over Russian troop deployments along Ukraine's border, it was rather fitting that Rob joined us live from Estonia for our global energy and energy transition discussion. Rob shared the background story on how and why he founded Thunder Said Energy in 2019. One of his main objectives is to identify and track already-existing technologies that could realistically decarbonize the global economy at acceptable cost in coming decades. Then he estimates the optimal mix to accomplish that goal and shares his findings with his clients. To that end, he presented some of the core cost and risk findings from his year-ahead outlook, published yesterday: "Energy crisis: ten themes for 2022?". It was a fantastic and timely conversation and one we know you will enjoy as much as we did!To start the show, Mike Bradley provided a substantial overview of key energy themes for 2022 and reviewed this week's developments in OPEC+ governance and oil production strategy. Matt Portillo shared the TPH Research outlook for natural gas and crude oil in 2022. Colin Fenton bended our minds with a journey from how the multiverse plot device in the Marvel Cinematic Universe (MCU) franchise is starting to shape other cultural conventions (including energy policy) to yesterday's data on Tesla vehicle inventory currently in stock within 200 miles in Boston. (The punchline is the inventory is scarce, very expensive, and mostly located in New York and New Jersey).​​​​As you all likely know, my official last day at TPH is this Friday, January 7th. My experience at TPH has been a once-in-a-lifetime endeavor and I thank all of you and our past and present TPHers who made it possible. TPH is a special organization and I expect it to continue to thrive.​​​​​As of this Friday, we are spinning out COBT into a new business called Veriten, taken from "veritas" and energy to represent "truth in energy." This new energy information platform will have one key mission: to improve the quality and purpose of current debate around the future of energy and the environment. Like you, we want to see a meeting of the minds on climate, economic development, national security, and technology that is as productive and civil as the issues are serious.

While we can't believe we are reaching the end of 2021, today we had a fantastic visit with Carolyn Hansard, Senior Director - Energy, Natural Resources, and Infrastructure, from the Teacher Retirement System ("TRS") of Texas to complete an amazing year of COBT guests. Carolyn's background includes 9 years at TRS and 17 years at Merrill Lynch in London, Tokyo, and New York. She is a longtime friend of ours! To begin, Carolyn walks us through an overview of TRS and their portfolio. TRS is one of the largest pension funds in the nation and Texas educators make up roughly 6% of the state's population. We touch on the considerations Carolyn and her team make when investing, how those considerations may differ by state, framework for risk and disruption, cryptocurrency and a few concerns to watch over the next few years. With Carolyn, we hit on all the questions you might expect us to, with a twist here and there. Hearing Carolyn addressing the issues of the day from the vantage point of a $19 billion energy investor really adds a lot of perspective. We think you'll enjoy the conversation as much as we did! The kickoff today was really great. Everyone hit on some of their top themes of 2021. Mike Bradley rattled off a ton of them, with the performance of classic energy being key. Matt Portillo hit on some of the big picture investor themes and preferences underlying that performance. Chad Michael, our new President, reviewed some transactional themes for the year as well. Lastly, Colin Fenton gave a robust summary of the "truth tellers" versus the "dogmatists" as he reflected on the big questions of the year. Today's COBT is our last for the year. Like you, we are very excited about spending some time with our family and friends. On January 4th, we will be back with a session featuring Rob West from Thunder Said Energy. Rob is a fresh energy thinker and we can't wait to visit with him. We will also share our own reflections on 2021 and introduce our big picture thoughts for 2022. And... WE ARE MOVING! As you may know, I will be transitioning out of TPH on January 7th. It has been a magical 14 years and 15 days. We are planning on standing up "COBT" as a new platform and that's going to be a very exciting thing. You will be able to find us in the future at our new webpage, www.veriten.com. The first episode of COBT in the new format will be coming your way on Wednesday morning, February 2nd! 

Today we had the pleasure of hosting Amy Myers Jaffe, Research Professor and Managing Director of the Climate Policy Lab at the Tufts University Fletcher School. Amy has taught energy policy, business, and sustainability courses at several distinguished universities and recently published "Energy's Digital Future: Harnessing Innovation for American Resilience and National Security."​​​​​Our discussion spanned several topics including investor interest in energy, Amy's new book, and hearing about the community at Tufts and what current students are interested in. It was a meaty discussion and we sincerely thank Amy for spending the time with us.The TPH crew ran through a few items to start: our energy strategist Mike Bradley looked at the energy market over the past week, European energy prices, PPI/CPI vs. government bond prices, and shared an interesting observation about TIME's person of the year. Matt Portillo noted considerations around return to capital in the upstream space and tag-teamed with Matthew Blair who covered key takeaways from a TPH Research conference call on Renewable Volume Obligation and its effects on pricing. Colin Fenton walked us through three prices to pay attention to as we approach year-end.​​​​​----------Copyright 2021, Tudor, Pickering, Holt & Co. The information contained in this update is based on sources considered to be reliable but is not represented to be complete and its accuracy is not guaranteed. This update is designed to provide market commentary only. This update does not constitute an offer to sell or a solicitation of an offer to buy any securities. Nothing contained in this update is intended to be a recommendation of a specific security or company nor is any of the information contained herein intended to constitute an analysis of any company or security reasonably sufficient to form the basis for any investment decision. Past performance is not indicative of future results. Tudor, Pickering, Holt & Co., and its officers, directors, shareholders, employees and affiliates and members of their families may have positions in any securities mentioned and may buy or sell such securities before, after or concurrently with the publication of this update. In some instances, such investments may be inconsistent with the views expressed herein. Tudor, Pickering, Holt & Co. may, from time to time, perform or solicit investment banking or other services for or from a company, person or entities mentioned in this update. Additional important disclosures, including disclosures regarding companies covered by TPH’s research department, may be found at www.tphco.com/Disclosure. Tudor, Pickering, Holt & Co. (TPH) is the global brand name for Tudor, Pickering, Holt & Co. Securities, LLC, Tudor, Pickering, Holt & Co. Securities – Canada, ULC, Perella Weinberg Partners LP, and their affiliates worldwide. Institutional Communication Only. Under FINRA Rule 2210, this communication is deemed institutional sales material and it is not meant for distribution to retail investors. Recipients should not forward this communication to a retail investor.

We are in the middle of an eventful energy news week and are very excited to dig in with all of you for this week's session. We are so pleased to welcome back our good friend Alexander Zaslavsky, Horizon Client Access, to share his expertise in Russian geopolitics and help us understand the current state of energy in Russia and its outlying countries. Oh yes, and one more thing, to help us understand why they might invade Ukraine!With so much to cover after a meaty introduction, we quickly dove into the current European energy situation, Russian political news, a bit of history with Russian pipelines, Putin, China's role, Russian oil and gas companies, the Ukraine, and much more. It was an engaging global discussion and we know you will enjoy it as much as we did. Thank you Alex for visiting with us!​​​​​As mentioned, today's introduction was packed with information: Mike Bradley shared an energy market update and prepped us for our session with Alex with an insightful summary of the top five Russian oil companies stock performance over the last year. Back from NYC, Matt Portillo highlighted client feedback from recent TPH Research marketing trips. Craig Webster joined to report on recent methane headlines including letters that the U.S. House of Representatives Committee on Science, Space, & Technology sent to ten companies in the Permian Basin requesting data on their methane measurement and new technology ideas. Also noteworthy is EQT's response to Senator Warren. Colin Fenton also arranged a few slides showing US vs. European natural gas fundamentals over the last 20 years to help frame our European energy discussion.

We had the pleasure of hosting Lior Frenkel, CEO and Co-Founder of Waterfall Security for today's informative session about cybersecurity and energy. Lior has over 20 years of experience with hardware and software research and development and his knowledge in the industry is unparalleled. We had an engaging and eye-opening conversation about cybersecurity threats and Waterfall's unidirectional gateway technology.Headquartered in Israel, Waterfall's technology protects power plants, pipelines, food and beverage manufacturers, railway systems, airports and more. Their mission is to revolutionize how industries protect physical assets and industrial processes from cyber-attacks. While we may think we are all non-targets for cyber-attacks, with the right capabilities and motivation all institutions are at risk, especially in the industrial sector. Thank you Lior for spending time with us!​​​​​​To start the session, Mike Bradley talked about overall market volatility, crude oil trading levels, ranges and technical support, and lastly the mood in the market following the SPR announcement, the new COVID variant,  and today's Fed testimony. Matt Portillo added to Mike's comments with an update on natural gas and Colin Fenton closed out the opening with a crude oil options market deep dive.----------Copyright 2021, Tudor, Pickering, Holt & Co. The information contained in this update is based on sources considered to be reliable but is not represented to be complete and its accuracy is not guaranteed. This update is designed to provide market commentary only. This update does not constitute an offer to sell or a solicitation of an offer to buy any securities. Nothing contained in this update is intended to be a recommendation of a specific security or company nor is any of the information contained herein intended to constitute an analysis of any company or security reasonably sufficient to form the basis for any investment decision. Past performance is not indicative of future results. Tudor, Pickering, Holt & Co., and its officers, directors, shareholders, employees and affiliates and members of their families may have positions in any securities mentioned and may buy or sell such securities before, after or concurrently with the publication of this update. In some instances, such investments may be inconsistent with the views expressed herein. Tudor, Pickering, Holt & Co. may, from time to time, perform or solicit investment banking or other services for or from a company, person or entities mentioned in this update. Additional important disclosures, including disclosures regarding companies covered by TPH’s research department, may be found at www.tphco.com/Disclosure. Tudor, Pickering, Holt & Co. (TPH) is the global brand name for Tudor, Pickering, Holt & Co. Securities, LLC, Tudor, Pickering, Holt & Co. Securities – Canada, ULC, Perella Weinberg Partners LP, and their affiliates worldwide. Institutional Communication Only. Under FINRA Rule 2210, this communication is deemed institutional sales material and it is not meant for distribution to retail investors. Recipients should not forward this communication to a retail investor.

First of all, a heartfelt Happy Thanksgiving to you all! We all have much to be thankful for and here at TPH/COBT, we are particularly thankful for your friendship. Last year on Thanksgiving, we gambled and did something that was not only fun but ended up being pretty popular. We did a video featuring energy professionals working on Thanksgiving Day. We were lucky enough to get representation from Phillips 66, Diamondback, Plains All American, and Liberty Oilfield Services. I bumped into a good friend at the API Dinner a couple of weeks ago he asked if we were up to do it again. We honestly hadn't decided at that point but the more we thought about it, the more we wanted to do it. So here we go! This year's line-up showcases energy life in the field in the Permian, at a natural gas plant south of Dallas, at a control center here in Houston, and at a huge LNG facility in Louisiana. Special thanks to the executive teams at Halliburton, Calpine, and Cheniere for helping us get this done. And special thanks to the group who pulled themselves away from the important jobs they do every day to join us in a Special Thanksgiving discussion: Robert Dewitt, CalpineChristopher Jerez, HalliburtonAndrew Sleet, CheniereLuke Yardy, CalpineI don't want to spoil it because I really hope you watch... but the one thing that is inescapable in this video discussion is the determination and grit of the energy industry. It is more than a little reminiscent of the men and women in our Armed Forces. We can rely on them, their work never stops, they are big-hearted, they are smart, and they make it happen for the rest of us. ​​​​​You will hear in the session that we mention the Thanksgiving table and all of the relatives who might want to talk about energy. For fun, we reached out to Alex Epstein and asked him for his Thanksgiving talking points. As you will see in the attached link, Alex volunteered to help you with your Thanksgiving energy discussions. :-)Let me wrap this up and let you get back to your Thanksgiving festivities. Please enjoy the day and thank you again for your continued friendship. We would be nowhere without you. God bless you and your family this Thanksgiving holiday. All the best from the COBT Team!

Today we had some great learning... or we should say "relearning." We had a great visit with Jerry McHugh of "San Juan IQ" - a monthly webcast hosted by Jerry where everything that’s happening in the San Juan basin is discussed. Jerry is a long-time veteran of the basin and has been CEO of San Juan Resources since 1990.As you will hear, we covered a ton of territory with Jerry today. The basin’s latest production, the rig count, the new (and old) players, the types of wells, the outlook, the potential for LNG, the dealings with the BLM, New Mexico’s new methane regulations, etc. It was a really fun walkthrough of what we all knew as a real granddaddy of US gas basins. Jerry was kind enough to share some summary slides.Today’s lead-in was outstanding. Mike hit the developments with the SPR and the Biden Administration’s attempt to do “something.” Matt Portillo and Matthew Blair jumped in talked some new work the TPH team has been doing around renewable fuels (big new report out last week). Colin brought us home with a deeper dive on what’s really going on with gasoline prices (after highlighting some of the Administration’s recent comments). It was a zesty lead-in from the TPH crew.As well turn towards Thanksgiving, we wish you all the best and ARE SO THANKFUL for your friendship. We will tease by sharing we do have something up our sleeve for Thanksgiving day barring technical or other difficulties. Let’s just say it should be the kind of thing your whole family should watch. Or maybe better yet, all of America.----------Copyright 2021, Tudor, Pickering, Holt & Co. The information contained in this update is based on sources considered to be reliable but is not represented to be complete and its accuracy is not guaranteed. This update is designed to provide market commentary only. This update does not constitute an offer to sell or a solicitation of an offer to buy any securities. Nothing contained in this update is intended to be a recommendation of a specific security or company nor is any of the information contained herein intended to constitute an analysis of any company or security reasonably sufficient to form the basis for any investment decision. Past performance is not indicative of future results. Tudor, Pickering, Holt & Co., and its officers, directors, shareholders, employees and affiliates and members of their families may have positions in any securities mentioned and may buy or sell such securities before, after or concurrently with the publication of this update. In some instances, such investments may be inconsistent with the views expressed herein. Tudor, Pickering, Holt & Co. may, from time to time, perform or solicit investment banking or other services for or from a company, person or entities mentioned in this update. Additional important disclosures, including disclosures regarding companies covered by TPH’s research department, may be found at www.tphco.com/Disclosure. Tudor, Pickering, Holt & Co. (TPH) is the global brand name for Tudor, Pickering, Holt & Co. Securities, LLC, Tudor, Pickering, Holt & Co. Securities – Canada, ULC, Perella Weinberg Partners LP, and their affiliates worldwide. Institutional Communication Only. Under FINRA Rule 2210, this communication is deemed institutional sales material and it is not meant for distribution to retail investors. Recipients should not forward this communication to a retail investor.

Today we had a fascinating discussion with the management of California Resources Corporation (CRC) about their low carbon initiatives. President and CEO Mac McFarland and Executive Vice President and CFO Francisco Leon joined us for a walkthrough of their thinking, activities and plans in this super important area. Much like the Apache team joining us to describe their innovative tree program, we hope to continue to highlight companies doing innovative things to make oil and gas cleaner. We are all in this together! We hope by sharing and highlighting innovative practices we can all get better.What you will hear from the CRC team is that they have been studying these options for a very long time but in the last 6 months or so it was time to make the move. They were already using CO2 for injection but have now thought through storage and sequestration. They have added solar in the field, applied for two Class VI permits and have made a net zero commitment on scope one, two and three emissions by 2045. It's all honestly really impressive stuff. We really appreciate Mac and Francisco joining today. As discussed, you can find their most recent investor presentation and the clean air task force analysis. We kicked off with Mike Bradley talking a little about what's going on "Over There" and Colin Fenton gave us an awesome tutorial on inflation. There are lots of fun facts but the best one was we have only been above 6 percent inflation (we are 6.2 now) 13 percent of the time since 1950. Transitory is on the verge of becoming predatory. Craig Webster was able to join us for the CRC discussion as well. We hope you enjoy today's discussion and can take away some things for your own business as you hear the CRC story.----------Copyright 2021, Tudor, Pickering, Holt & Co. The information contained in this update is based on sources considered to be reliable but is not represented to be complete and its accuracy is not guaranteed. This update is designed to provide market commentary only. This update does not constitute an offer to sell or a solicitation of an offer to buy any securities. Nothing contained in this update is intended to be a recommendation of a specific security or company nor is any of the information contained herein intended to constitute an analysis of any company or security reasonably sufficient to form the basis for any investment decision. Past performance is not indicative of future results. Tudor, Pickering, Holt & Co., and its officers, directors, shareholders, employees and affiliates and members of their families may have positions in any securities mentioned and may buy or sell such securities before, after or concurrently with the publication of this update. In some instances, such investments may be inconsistent with the views expressed herein. Tudor, Pickering, Holt & Co. may, from time to time, perform or solicit investment banking or other services for or from a company, person or entities mentioned in this update. Additional important disclosures, including disclosures regarding companies covered by TPH’s research department, may be found at www.tphco.com/Disclosure. Tudor, Pickering, Holt & Co. (TPH) is the global brand name for Tudor, Pickering, Holt & Co. Securities, LLC, Tudor, Pickering, Holt & Co. Securities – Canada, ULC, Perella Weinberg Partners LP, and their affiliates worldwide. Institutional Communication Only. Under FINRA Rule 2210, this communication is deemed institutional sales material and it is not meant for distribution to retail investors. Recipients should not forward this communication to a retail investor.