Big Digital Energy

00:00:00 [Speaker 1]
Alright.
00:00:01 [Speaker 1]
I have no idea where to go with this, Kirk.
00:00:04 [Speaker 1]
You know, maybe when the cat's away, the mouse will play.
00:00:08 [Speaker 1]
Mom and dad aren't home.
00:00:10 [Speaker 1]
What are we doing

00:00:11 [Speaker 2]
with that mark?
00:00:12 [Speaker 2]
When when one of our boys who actually runs the show for us is gone, we're lost, Chuck.

00:00:19 [Speaker 1]
We're totally lost.
00:00:20 [Speaker 1]
I don't even know what we're gonna talk about.
00:00:22 [Speaker 1]
Or is that you know, we always talk about a run of show.
00:00:24 [Speaker 1]
It's like, where's the run of show?

00:00:26 [Speaker 2]
We're just gonna talk golf and, you know, like, food Houston food dives.
00:00:32 [Speaker 2]
Speaking of, we were just talking about a great dive.
00:00:38 [Speaker 2]
Set it up, Chuck.

00:00:39 [Speaker 1]
So so okay.
00:00:41 [Speaker 1]
Our executive producer and the one that makes us look really good every week is Jacob.
00:00:48 [Speaker 1]
Great dude.
00:00:48 [Speaker 1]
But he was running smack at me on the internal collide channel because AGA, the restaurant, it's down in Stafford.
00:00:57 [Speaker 1]
It's actually the highest rated restaurant in all of America.

00:01:00 [Speaker 1]
It outranks it outrates if you look at Google ratings, the French Laundry.
00:01:06 [Speaker 1]
I've kinda gone down this, this route doing it.
00:01:09 [Speaker 1]
It's Indian Pakistani food.
00:01:12 [Speaker 1]
It's amazing.
00:01:13 [Speaker 1]
You show up Saturday at five, and it's like an hour and a half wait.

00:01:18 [Speaker 1]
Massive restaurant, massive takeout service.
00:01:21 [Speaker 1]
Anyway, their signature dish for years was the goat chop, and the goat chop is amazing.
00:01:27 [Speaker 1]
I mean, literally a there it is.
00:01:29 [Speaker 1]
A top

00:01:30 [Speaker 2]
five so good.

00:01:32 [Speaker 1]
Top five piece of protein.
00:01:34 [Speaker 1]
And they announced about two months ago that they were gonna retire the goat chop and bring a lamb chop out.
00:01:41 [Speaker 1]
And so, anyway, on the lunch drop menu this week, it said we're gonna get AGA.
00:01:46 [Speaker 1]
And I went into the Slack and said, man, I had the lamb chops last night.
00:01:49 [Speaker 1]
They're so great.

00:01:51 [Speaker 1]
And Jacob, with only the condescension or disdain that he could muster said, oh my god.
00:01:59 [Speaker 1]
Shaking my head.
00:02:00 [Speaker 1]
It's goat chop, not lamb chop.
00:02:03 [Speaker 1]
And I had to bust him and show him the Facebook post and say, dude, keep up.
00:02:07 [Speaker 1]
Sorry.

00:02:09 [Speaker 2]
I mean, what is Jacob thinking about busting you?
00:02:13 [Speaker 2]
He knows better.

00:02:14 [Speaker 1]
I know.
00:02:16 [Speaker 1]
Arcane pop culture references, that's my jam.
00:02:19 [Speaker 1]
That's what I do.
00:02:22 [Speaker 1]
Alright.
00:02:23 [Speaker 1]
Give me a golf bit.

00:02:24 [Speaker 1]
We don't have Mark.
00:02:24 [Speaker 1]
What's going

00:02:25 [Speaker 2]
on there?
00:02:26 [Speaker 2]
First of all, while you were talking, I was like, nothing beats a good cabrito, man.
00:02:32 [Speaker 2]
I love cabrito.
00:02:33 [Speaker 2]
The Mexicans know how to do goat.
00:02:36 [Speaker 2]
Let's go.

00:02:37 [Speaker 2]
But I don't know.
00:02:39 [Speaker 2]
Have you ever been to Chachos?

00:02:42 [Speaker 1]
No.
00:02:43 [Speaker 1]
Where's that?

00:02:44 [Speaker 2]
It's on Westheimer.
00:02:45 [Speaker 2]
It's great.
00:02:46 [Speaker 2]
But I have every so often, maybe once every six months, I have this, like, I have to go to Chachos because Chachos has you can you can order barbacoa by the pound, and I would order pounds of barbacoa.
00:03:06 [Speaker 2]
And Chachos knows how to do it.
00:03:08 [Speaker 2]
So if you're thinking about goat or barbacoa, does anyone know what barbacoa is?

00:03:14 [Speaker 1]
Oh, yeah.

00:03:14 [Speaker 2]
Know what it is, Chuck?

00:03:15 [Speaker 1]
Of course.

00:03:16 [Speaker 2]
It is Cow Cow face.
00:03:18 [Speaker 2]
Fantastic.

00:03:19 [Speaker 1]
Cow face.

00:03:20 [Speaker 2]
Yeah.
00:03:20 [Speaker 2]
It's so good.
00:03:22 [Speaker 2]
So Chacho's barbacoa, order it by the pound.
00:03:27 [Speaker 2]
You can't beat it.

00:03:29 [Speaker 1]
That's awesome.
00:03:30 [Speaker 1]
There's a, I'm blanking on the name of the place that, I used to take my kids to get barbacoa all the time, and they actually made barbacoa tamales, which were Oh.
00:03:43 [Speaker 1]
Oh, good.
00:03:43 [Speaker 1]
Bomb.
00:03:44 [Speaker 1]
And the reason the kids loved it is because it was true barbacoa.

00:03:49 [Speaker 1]
They would soak the, cow heads in water.
00:03:52 [Speaker 1]
You know?
00:03:52 [Speaker 1]
Yeah.
00:03:53 [Speaker 1]
And

00:03:53 [Speaker 2]
Oh, yeah.

00:03:53 [Speaker 1]
And boil them.
00:03:56 [Speaker 1]
And all the cow heads, so these skulls with the big, the big horns would be out front piled up.
00:04:02 [Speaker 1]
And maybe that was all just shtick, but, we used to we used to go there and get, that stuff.
00:04:09 [Speaker 1]
It was so good.

00:04:11 [Speaker 2]
Well, now that we're we're talking, you know, barbacoa, we're talking cabrito.
00:04:19 [Speaker 2]
There's another place that I've tried, and it's actually really good.
00:04:25 [Speaker 2]
And I'm trying to look it up.
00:04:26 [Speaker 2]
It's a gas station.
00:04:29 [Speaker 2]
Echoes Greek American Deli.

00:04:32 [Speaker 2]
It's on Richmond And Rice Avenue for their, further, what do you call the what do you call the lamb?

00:04:46 [Speaker 1]
Oh, yeah.
00:04:46 [Speaker 1]
Yeah.
00:04:47 [Speaker 1]
Yeah.

00:04:48 [Speaker 2]
For their lamb.

00:04:49 [Speaker 1]
I won't get it.

00:04:51 [Speaker 2]
It's fantastic.
00:04:52 [Speaker 2]
It's out of a Valero gas station.
00:04:55 [Speaker 2]
Speaking of Valero, Chuck, we're actually gonna kick it off talking about Venezuela.

00:05:02 [Speaker 1]
I was about to say that was a pretty impressive transition because I didn't think we had it had it in had it in us.
00:05:09 [Speaker 1]
I just texted I texted Jacob.
00:05:11 [Speaker 1]
So maybe do you wanna riff on the Venezuela deal?
00:05:14 [Speaker 1]
I I asked Jacob if he could prove pull up the, truth social Trump post about Venezuela.

00:05:22 [Speaker 2]
Well, Trump announced the biggest oil deal in the world history, and it's the Venezuela deal.
00:05:31 [Speaker 2]
And so what is it?
00:05:34 [Speaker 2]
All I know is that it is a shit show.
00:05:38 [Speaker 2]
55% US share, 17 fields, 65,000,000 barrels, a hundred year lease negotiated by Rubio, our secretary of state, and our secretary of war, Pete Hegseth.
00:05:56 [Speaker 2]
So this sounds like I can doesn't even sound real, Chuck, to me.

00:06:02 [Speaker 2]
And they negotiate

00:06:03 [Speaker 1]
Come on.
00:06:04 [Speaker 1]
Oh, come on.
00:06:04 [Speaker 1]
How long have you been in the energy business and heard shit like this?
00:06:08 [Speaker 1]
This sounds exactly like the energy business.

00:06:11 [Speaker 2]
This is great.
00:06:13 [Speaker 2]
And then negotiated with a woman, Delce Rodriguez.
00:06:17 [Speaker 2]
Who's Delce?
00:06:18 [Speaker 2]
She's she's our age, Chuck.
00:06:21 [Speaker 2]
She's a lawyer.

00:06:21 [Speaker 2]
She's from Caracas.
00:06:24 [Speaker 2]
She's Maduro's vice president since 2018, also serving simultaneously as the finance minister of oil.
00:06:33 [Speaker 2]
And she's been overseeing Venezuela oil economy and its intelligence service.
00:06:38 [Speaker 2]
Now who is she?
00:06:39 [Speaker 2]
Well, she her father is Jorge Antonio Rodriguez, who's a Marxist guerrilla leader, of course, who cofounded the socialist league, arrested in connection with the 1976 kidnapping of an American businessman, died in police custody at age 34.

00:07:00 [Speaker 2]
So we this is just you can't make this shit up.
00:07:05 [Speaker 2]
And what do we know about this, Chuck?
00:07:07 [Speaker 2]
There are some parallels here.
00:07:09 [Speaker 2]
Go ahead.
00:07:09 [Speaker 2]
I want you to talk.

00:07:10 [Speaker 2]
You go ahead.

00:07:11 [Speaker 1]
Man, you know, good.
00:07:13 [Speaker 1]
Great.
00:07:13 [Speaker 1]
Where do I start?
00:07:16 [Speaker 1]
It's typical okay.
00:07:17 [Speaker 1]
I'm gonna take a very unpopular, opinion here.

00:07:21 [Speaker 1]
I'm actually gonna defend Donald Trump on this.
00:07:25 [Speaker 1]
And, yeah.
00:07:26 [Speaker 1]
No.
00:07:27 [Speaker 1]
Which I know is so weird, but what is gonna what what what is the criticism that we've seen?
00:07:33 [Speaker 1]
Okay.

00:07:33 [Speaker 1]
Imperialists, fascists, all that stuff.
00:07:36 [Speaker 1]
Okay.
00:07:36 [Speaker 1]
I get it.
00:07:37 [Speaker 1]
That's table stakes for Donald Trump criticism.
00:07:40 [Speaker 1]
The next thing we've heard is, oh my god.

00:07:43 [Speaker 1]
Venezuela is producing less than a million barrels a day right now.
00:07:48 [Speaker 1]
There's no way we can fill up the SPR with this because that's part of what Trump was spending is, boom, I'm just gonna fill up the SPR with Venezuelan crude.
00:07:57 [Speaker 1]
Then you get into the whole thing of, you know, the Venezuelan crude is generally heavier, so it doesn't even operationally work to fill our our SPR.
00:08:08 [Speaker 1]
And so you've heard all of that criticism.
00:08:12 [Speaker 1]
Here's where I'm gonna defend Trump, though.

00:08:16 [Speaker 1]
At his core, what is he?
00:08:18 [Speaker 1]
He's a real estate broker.
00:08:19 [Speaker 1]
Right?
00:08:20 [Speaker 1]
And what do real estate brokers do?
00:08:23 [Speaker 1]
Hyperbole.

00:08:24 [Speaker 1]
Right?
00:08:24 [Speaker 1]
You go in, oh, this is the greatest house because it's the greatest street in all of Westview.
00:08:29 [Speaker 1]
Oh, they got the best schools.
00:08:30 [Speaker 1]
Right?
00:08:31 [Speaker 1]
I mean, we we've all bought a house.

00:08:33 [Speaker 1]
We've all heard that from the real estate broker.
00:08:36 [Speaker 1]
That being said, the real estate broker is directionally true on stuff.
00:08:41 [Speaker 1]
And so I think if you look at things with Trump through the lens of real estate broker hyperbole, not gonna have the details right, but directionally, is it true?
00:08:55 [Speaker 1]
This is actually an interesting thing.
00:08:57 [Speaker 1]
I mean, it's probably a shell company for this Venezuelan dude.

00:09:02 [Speaker 1]
I read his name earlier, and I can't remember it.
00:09:04 [Speaker 1]
But, anyway, he's gonna be pedaling this stuff out.
00:09:08 [Speaker 1]
It's 17 old conventional fields that have been run down, but that's the type of stuff that can get fixed up.
00:09:16 [Speaker 1]
And the United States military is gonna have at least 35% of this, and we're talking about The US having, you know, over half of the deal.
00:09:27 [Speaker 1]
Those are barrels that someone's gonna believe are gonna be produced at some point, and we can use them as currency today to trade and do some filling on the SPR.

00:09:39 [Speaker 1]
I bet, you know, I I bet Scott Bessent's on the phone right now for Vitol saying, how many barrels will you give me to fill SPR today?
00:09:51 [Speaker 1]
I mean, the DOE is basically a hedge fund when it comes to the SPR.
00:09:55 [Speaker 1]
They're always selling future barrels in exchange for getting barrels back and trading.
00:10:01 [Speaker 1]
And so I think this is not the solution that Trump, promised it is of filling the SPR tomorrow, but it is another asset that allows them to do some of this.

00:10:15 [Speaker 2]
So you're saying this is just one big negotiation, Chuck?
00:10:18 [Speaker 2]
Because that's what your position because the

00:10:21 [Speaker 1]
I'm I'm saying he drew a card or two.
00:10:24 [Speaker 1]
He's sitting there with his his five cards.
00:10:27 [Speaker 1]
He's now got two cards, in his hand to possibly play.

00:10:32 [Speaker 2]
Because as because those those tacticians in the room are saying there's no way like, Venezuela has been ignored.
00:10:43 [Speaker 2]
The the assets are in crappy condition.
00:10:47 [Speaker 2]
They haven't been upkeeping them.
00:10:49 [Speaker 2]
And by the way, the Venezuela constitution vest petroleum control to the state.
00:10:57 [Speaker 2]
So so there's we don't even have so we're not even sure that she has the legal rights to do this deal.

00:11:06 [Speaker 2]
But even with that, we're saying that this is one big negotiation.

00:11:12 [Speaker 1]
And let's layer on another negotiation on it.
00:11:15 [Speaker 1]
I've talked to someone close to the source, and I cannot reveal my sources as a journalist.
00:11:22 [Speaker 1]
But the interesting dynamic the way to think about this is you are paying royalties to the Venezuelan government because you lease from the crown, you're almost in effect having to do a surface use agreement with PDVSA.
00:11:41 [Speaker 1]
Because PDVSA is on the ground.
00:11:43 [Speaker 1]
They've got people in all the fields there.

00:11:47 [Speaker 1]
And, so anyway, you you basically kinda have to pay them off too to get them to help you and and do stuff.
00:11:55 [Speaker 1]
So that's that's one element.
00:11:57 [Speaker 1]
The other thing that my source said, that's interesting, and I think we all knew this, but but maybe didn't fully appreciate.
00:12:08 [Speaker 1]
And let me set it up with a little story.
00:12:10 [Speaker 1]
So Mike Hines and I'm a business partner at Kean, went to where's the, where's the, Pro Football Hall of Fame, Canton, Ohio?

00:12:23 [Speaker 1]
Yeah.
00:12:23 [Speaker 1]
Went so, anyway, we went to Canton, Ohio where Range Resources had its Ohio headquarters, in effect, the regional the regional office.
00:12:36 [Speaker 1]
And what had happened is Range was actually gonna sell Ohio, and they gave management a shot to buy it first.
00:12:46 [Speaker 1]
And so Mike and I went in there, looked at the deal, talked to the deal.
00:12:50 [Speaker 1]
They had, like, $10,000,000 a year G and A, and we were idiots.

00:12:55 [Speaker 1]
We were young.
00:12:55 [Speaker 1]
We said, oh, you know, you could probably run this company for about 3,000,000 of G and A.
00:13:01 [Speaker 1]
And the guy looked at us and said, well, I'm obviously not gonna buy this with you.
00:13:05 [Speaker 1]
And I go, oh, okay.
00:13:06 [Speaker 1]
I get it.

00:13:08 [Speaker 1]
And, anyway, so we we kinda went through the motions that day.
00:13:12 [Speaker 1]
We we wound up going to a football game that night, saw Cleveland and Pittsburgh play, Thursday night game.
00:13:20 [Speaker 1]
It was minus 12 degrees.
00:13:22 [Speaker 1]
Josh Cribbs returned two touchdowns, on punt returns.
00:13:26 [Speaker 1]
It was pretty amazing game even though I froze my butt off.

00:13:30 [Speaker 1]
But the point of it is that night, Mike and I are sitting there.
00:13:33 [Speaker 1]
He was smart enough to drink wild turkey, so he was warm.
00:13:36 [Speaker 1]
I was drinking beer, so I was freezing cold.
00:13:38 [Speaker 1]
But Mike did say, and this was way pre shale revolution.
00:13:42 [Speaker 1]
He said, you know what's wild, Chuck?

00:13:44 [Speaker 1]
Every one of those logs we looked on at had at least four shales.
00:13:49 [Speaker 1]
And, man, if any one of those shales worked out and you owned all of Ohio, you'd be really rich.
00:13:55 [Speaker 1]
So, anyway, EnerVest wound up buying it, went to the, the house with that.
00:14:01 [Speaker 1]
And the reason I bring up that story is I'm filling because normally, Mark talks a lot longer, so I am filling.
00:14:07 [Speaker 1]
But the same is true with Venezuela.

00:14:10 [Speaker 1]
All the the folks I know that have been down there and looking at it say there is shale everywhere.
00:14:17 [Speaker 1]
So you're talking literally 30,000 acre concession to somebody, you know, give it to some Midland guys.
00:14:25 [Speaker 1]
Maybe we drag Steve Gray out of retirement, any of those folks, and let them go to town, it's not out of the realm of possibilities.
00:14:36 [Speaker 1]
But sooner rather than later, instead of talking about 800,000 barrels a day going to one and a half million, you could be talking about Venezuela, 10,000,000, 11,000,000 a day.
00:14:46 [Speaker 1]
Those shales are down there, and they're real.

00:14:48 [Speaker 2]
Well, we need to get we need to get somebody that actually has been on the ground in Venezuela to give us a real update on a tactical basis.
00:14:59 [Speaker 2]
Because my two questions and I have a lot more to add here.
00:15:02 [Speaker 2]
But my two questions is there's no way we're ever gonna get above a million anytime soon out of Venezuela.
00:15:12 [Speaker 2]
So that's I'm just calling it right now.
00:15:14 [Speaker 2]
That's three years from that's three years away, maybe five.

00:15:18 [Speaker 2]
Trump's out of office.
00:15:20 [Speaker 2]
Second, let's go back to Ohio for a second, Chuck, and I have a question for you.
00:15:25 [Speaker 2]
Who knew speaking of, I'm playing golf in Nantucket, playing with some new besties on the island that I am hanging out with.
00:15:34 [Speaker 2]
And lo and behold, who's playing golf in front of me?
00:15:38 [Speaker 2]
Ryan Day.

00:15:40 [Speaker 2]
They're buddies best buddies with Ryan Day.
00:15:42 [Speaker 2]
Who's Ryan Day?
00:15:43 [Speaker 2]
Head coach of Ohio State.
00:15:46 [Speaker 2]
Right.
00:15:46 [Speaker 2]
I ask him.

00:15:47 [Speaker 2]
And I'm like, go horns.
00:15:49 [Speaker 2]
And he Ryan Day looks at me like, who the hell are you?
00:15:53 [Speaker 2]
Yeah.
00:15:54 [Speaker 2]
But my question is, why are Ohio State fans not like the best coach in college football?
00:16:01 [Speaker 2]
That's a side note.

00:16:02 [Speaker 2]
I wanna hear our fans write in about this because Ryan Day, arguably, is the best football coach in college sports right now.
00:16:13 [Speaker 2]
But, anyway, I've met him.
00:16:15 [Speaker 2]
He's a nice guy, and he's a fucking ass kicker, by the way.
00:16:19 [Speaker 2]
So that's my 2¢.
00:16:20 [Speaker 2]
But here's my question, Chuck.

00:16:22 [Speaker 2]
Last week, we're talking about you and the Cain days.
00:16:26 [Speaker 2]
And if a refinery project comes in, anything that's midstream, you're, like, you're not going.
00:16:34 [Speaker 2]
No one wants to go because you're upstream guy.
00:16:37 [Speaker 2]
You like big margins.
00:16:39 [Speaker 2]
Small margin sucks.

00:16:42 [Speaker 2]
But here's my question.
00:16:43 [Speaker 2]
If you're sitting and you're think you're, like, gas up the, private jet, you've got big things to do.
00:16:51 [Speaker 2]
If a Venezuela project comes across your desk, what are you doing?
00:16:56 [Speaker 2]
Are you going to the meeting or not?

00:16:59 [Speaker 1]
The funny thing and the, position back at the previous spot was always I am the greatest private equity guy anywhere Southwest Airlines flies.
00:17:12 [Speaker 1]
So that that that's kind of where I, that's kinda where I, I I stayed on it.
00:17:18 [Speaker 1]
You know, we used to joke that we've got enough political risk in our California assets.
00:17:24 [Speaker 1]
We don't really need to go outside The US border to be able to do it.
00:17:29 [Speaker 1]
That being said, I mean, you've seen some real home runs from the, from the private equity folks going international.

00:17:37 [Speaker 1]
It seems like everybody stubs their toe up in Canada on a pretty regular basis.
00:17:43 [Speaker 1]
But at the end of the day, yeah, you've had you've had some some home runs.
00:17:49 [Speaker 1]
And the guys all going down there I mean, we're all, you know, big company guys, but there were a handful of private equity guys in that room down in, down in Venezuela.
00:18:00 [Speaker 1]
So I'd probably, take the meeting and, and others of my partners would not.

00:18:08 [Speaker 2]
And would you ask, like, hey.
00:18:10 [Speaker 2]
Where is Venezuela in regards to Midland?
00:18:13 [Speaker 2]
Are you are you asking, like, is Venezuela a smaller town in West Texas?
00:18:20 [Speaker 2]
Are you like, oh, I think it's in somewhere in South America?

00:18:24 [Speaker 1]
Probably so.
00:18:26 [Speaker 1]
Probably so.
00:18:27 [Speaker 1]
I did have a I did have a buddy back in college.
00:18:30 [Speaker 1]
So, you know, call it thirty five years ago, went to Caracas for a for a week for spring break.
00:18:37 [Speaker 1]
Said it's the best time on the plant.

00:18:39 [Speaker 1]
You know?
00:18:39 [Speaker 1]
He had the best time.
00:18:40 [Speaker 1]
I mean, that was back I mean, before these socialist got in there and destroyed it, I mean, Venezuela was, what, number two in in, in the Western Hemisphere in terms of wealth, two or three.
00:18:52 [Speaker 1]
I mean, it was a it was a party good time.

00:18:55 [Speaker 2]
I mean, even I have some colleagues.
00:18:57 [Speaker 2]
I love the the former Exxon days where they have some great stories about being in Venezuela and Caracas and great stories about having get the hell out of there.
00:19:06 [Speaker 2]
So there's some great stories that we have running around Houston that are fantastic.
00:19:13 [Speaker 2]
But here's my warning.
00:19:14 [Speaker 2]
I've got one warning and a and a history lesson because because I wanted it like, when Trump announced this best deal of all time, I get a little uncomfortable because it reminds me back in nineteen o one, British engineer, guy named William Knox D'Arcy, secured a sixty year concession from the Shah of Persia, exclusive rights to discover, exploit, and export petroleum across the entire country.

00:19:46 [Speaker 2]
In return, Persia gets 16% of annual profits.
00:19:51 [Speaker 2]
$20,000 are actually pounds in cash and £20,000 in shares.
00:20:00 [Speaker 2]
They struck oil in nineteen o eight, and they created what?
00:20:06 [Speaker 2]
The Anglo Persian Oil Company was formed.
00:20:10 [Speaker 2]
It became the most profitable enterprise in the British Empire.

00:20:15 [Speaker 2]
Do you know what that company is now called today?
00:20:18 [Speaker 2]
One we'd love to beat up on?

00:20:20 [Speaker 1]
I do, and, I love the I love the reference.
00:20:25 [Speaker 1]
BP perhaps?

00:20:27 [Speaker 2]
Yeah.
00:20:28 [Speaker 2]
BP.
00:20:29 [Speaker 2]
Great.
00:20:30 [Speaker 2]
It's just so good.
00:20:31 [Speaker 2]
But what happened to Persia?

00:20:34 [Speaker 2]
So the company paid Iran now, but let's call it Persia because it's so much more romantic.
00:20:42 [Speaker 2]
They paid Persia nothing.
00:20:44 [Speaker 2]
They didn't train really the Persians of how to really work the fields.
00:20:51 [Speaker 2]
And so what happened?
00:20:53 [Speaker 2]
A lot happened.

00:20:56 [Speaker 2]
So by '19, '51, the democratically elected prime minister Mosaddegh nationalized the company.
00:21:08 [Speaker 2]
And and so this was actually real interesting.
00:21:11 [Speaker 2]
So the the Brits, BP, create this the the the most profitable international expansion in the British Empire by doing this deal.
00:21:22 [Speaker 2]
So great for Darcy, bad for the Persia.
00:21:26 [Speaker 2]
So what does Iran do?

00:21:29 [Speaker 2]
They nationalize the assets because of the raw deal.
00:21:33 [Speaker 2]
And what what happens?
00:21:35 [Speaker 2]
The United States steps in and the CIA, and we overthrow Mosaddegh, put in the Shah, overthrow the Shah.
00:21:46 [Speaker 2]
And what are we doing today?
00:21:48 [Speaker 2]
What's the issue we've been talking about is we're The United States is still fighting with Iraq.

00:21:56 [Speaker 2]
And we've got this whole Hormuz issue.
00:22:00 [Speaker 2]
Hormuz, but we like Hormuz.
00:22:03 [Speaker 2]
It sounds like we do these great deals.
00:22:06 [Speaker 2]
We've got Venezuela over a barrel right now.
00:22:10 [Speaker 2]
We've got this hundred year lease, but it could turn into another Iran.

00:22:16 [Speaker 2]
And so my warning is, let's let's make sure we do a good deal.
00:22:22 [Speaker 2]
I don't know if we're just trading this and it's a short term just for headlines, or is this gonna turn into now Venezuela probably doesn't have a whole lot of capability to create this sort of bad will and and and raise the kind of funding and have the backbone that the Persians do.
00:22:44 [Speaker 2]
But this could turn in this could turn sideways on us.
00:22:47 [Speaker 2]
So I'm just warning everybody that let's take a long view of this.
00:22:52 [Speaker 2]
We might have the best deal ever known, maybe even better than what BP ended up doing to the Persians, but I'm just warning us that this could turn out bad long term.

00:23:05 [Speaker 1]
So I love that history lesson.
00:23:08 [Speaker 1]
I love that story.
00:23:10 [Speaker 1]
One little tidbit from that story that I've always found fascinating, and it's because one of my guys in Old Man Coffee was a long time BP executive.
00:23:21 [Speaker 1]
And he likes

00:23:21 [Speaker 2]
to never said a bad thing about BP.
00:23:25 [Speaker 2]
So I'm really appreciative of that.
00:23:28 [Speaker 2]
BP individuals.
00:23:29 [Speaker 2]
Good.
00:23:30 [Speaker 2]
Individuals.

00:23:30 [Speaker 2]
Of course.
00:23:31 [Speaker 2]
Yeah.
00:23:31 [Speaker 2]
Yeah.

00:23:31 [Speaker 1]
BP BP bad.
00:23:33 [Speaker 1]
BP individuals good.
00:23:35 [Speaker 1]
Good.
00:23:35 [Speaker 1]
No.
00:23:36 [Speaker 1]
But you know what was wild?

00:23:37 [Speaker 1]
So when they when, Iran, nationalized or Persia nationalized the oil fields, took it away, the stock price only dropped 30%.
00:23:52 [Speaker 1]
Ain't that kinda crazy?
00:23:53 [Speaker 1]
Yeah.
00:23:54 [Speaker 1]
I mean, literally, your whole concession is taken away, and you only dropped 30%.
00:24:00 [Speaker 1]
So, basically, 70% of the stock price was saying, they'll go in and do something.

00:24:09 [Speaker 1]
They'll renegotiate.
00:24:10 [Speaker 1]
They'll send in the military.
00:24:12 [Speaker 1]
Something will happen.
00:24:14 [Speaker 1]
And I've always found that intriguing because I thought that should have been the one time a stock price would have gone to zero.

00:24:21 [Speaker 2]
Well, I mean, that's actually fascinating because we're talking about Venezuela and PDVSA.
00:24:28 [Speaker 2]
What can they do?
00:24:30 [Speaker 2]
And the reality is all these mostly these American oil and gas companies that know Venezuela, what are they gonna do?
00:24:39 [Speaker 2]
I mean, they can't operate themselves out of a barrel of oil themselves.
00:24:44 [Speaker 2]
They can't even get out of a barrel of oil themselves if they're put inside of one.

00:24:48 [Speaker 2]
I think that was the reality back in Persia because BP never really trained anyone inside of the the Persian inside of Persia of how to actually run the oil fields, how to produce, how to upgrade.
00:25:05 [Speaker 2]
I think that's been a a long time issue of why many of us have thought national oil companies are really not the the best run companies.
00:25:14 [Speaker 2]
Partly, it's because they're government and government's inefficient, but we're starting to see that turnaround.
00:25:21 [Speaker 2]
And and I think that's interesting.
00:25:22 [Speaker 2]
I mean, we've got the Saudis.

00:25:24 [Speaker 2]
But the question is for and and and if we go back to Venezuela, it's doubtful that they're gonna have to do deals with with strategics.
00:25:38 [Speaker 2]
They're gonna I mean, what I mean is Venezuela is gonna have to do deals with oil companies that actually know how to do things.
00:25:46 [Speaker 2]
And that to me is the opportunity here.

00:25:49 [Speaker 1]
So if you're Conoco, you're sitting there watching Trump announce this deal as the greatest deal of all time, and you owe, what, Venezuela owes you, what, $1,012,000,000,000 dollars, something like that from the, the Chavez thing.
00:26:09 [Speaker 1]
When Trump came to Texas last week doing the big fundraise, for Ken Paxton, do you, do you think Conoco executives cut a check and showed up, or did they not?
00:26:21 [Speaker 1]
Were they pissed, or were they like, god, we gotta get in on that?

00:26:25 [Speaker 2]
I mean, Chuck, this sounds like you actually know the people in the room.
00:26:30 [Speaker 2]
So you tell me, or you just ask it.
00:26:33 [Speaker 2]
I know exactly where you're going with this, Chuck.
00:26:36 [Speaker 2]
You know people that were there.
00:26:38 [Speaker 2]
You know the inside scoop.

00:26:40 [Speaker 2]
But what can you say on air?

00:26:42 [Speaker 1]
Well, the funny thing about it and the greatest thing about getting fired is when somebody asks you to cut a big check for Ken Paxton, you can say, hey, man.
00:26:50 [Speaker 1]
I'm unemployed.
00:26:51 [Speaker 1]
You know?
00:26:52 [Speaker 1]
I'm sorry.
00:26:55 [Speaker 1]
Yeah.

00:26:56 [Speaker 1]
I'm I'm sorry.
00:26:57 [Speaker 1]
But I and it's interesting because today is Ryan Lance's last official day as CEO of Conoco.
00:27:07 [Speaker 1]
So I do not know if, if Ryan Lance was in the room or not and whether he had his checkbook with him.

00:27:14 [Speaker 2]
Yeah.
00:27:14 [Speaker 2]
Because he's unemployed as of today or tomorrow.

00:27:18 [Speaker 1]
There you go.
00:27:20 [Speaker 1]
And, what's his face?
00:27:22 [Speaker 1]
O'Brien has taken over.
00:27:26 [Speaker 1]
Andy O'Brien has taken over.
00:27:28 [Speaker 1]
I do not know if he was in the room or not.

00:27:30 [Speaker 1]
But maybe they'll come on BDE, and we can

00:27:33 [Speaker 2]
That would be fantastic.
00:27:34 [Speaker 2]
I bet we could get between, the three of us and our great producer, Jacob, we could probably get one of those guys on our show.

00:27:43 [Speaker 1]
Ryan Lance, now that he's a free agent.
00:27:45 [Speaker 1]
There you go.
00:27:46 [Speaker 1]
He's an unemployed dude.

00:27:48 [Speaker 2]
Do you know who ass you asshole.
00:27:50 [Speaker 2]
I almost said asshole, and I did on there.
00:27:52 [Speaker 2]
You know who also is, unemployed today for the first day in a long, long time.
00:28:02 [Speaker 2]
Who?
00:28:04 [Speaker 2]
The former CEO of Apple.

00:28:07 [Speaker 2]
Because today That's right.
00:28:08 [Speaker 2]
For the first time, John Ternes is day one as CEO of Apple.
00:28:15 [Speaker 2]
So Tim Cook, last day is he's gone.
00:28:19 [Speaker 2]
No longer.

00:28:20 [Speaker 1]
I mean, what?
00:28:21 [Speaker 1]
He took over at 345,000,000,000, and now they're 5,000,000,000,000 or wherever wherever they are today.
00:28:28 [Speaker 1]
So, I mean, a a fifteen year run kinda on par with any other superstar out there in the, in the history of tech world.
00:28:38 [Speaker 1]
Right?
00:28:39 [Speaker 1]
I

00:28:39 [Speaker 2]
mean I mean, let's give look.
00:28:41 [Speaker 2]
I I was pretty critical of Tim Cook coming in because, you know, you always think about because I was at you know, I worked for for Dell, Michael Dell, who was a a visionary, but he brought in a bunch of guys that could that could really operate and run the business.
00:29:00 [Speaker 2]
But they operated almost and sometimes when you bring in great operators, they sort of run the business into the ground or they they optimize the business, but they have really no, vision, if you will.
00:29:14 [Speaker 2]
But Tim Cook, fair enough, ran a great company, but he still wasn't, you know, the the guy who was brought back in into Apple to turn it around when it was about to go to zero.
00:29:28 [Speaker 2]
But Tim Cook was a great CEO.

00:29:31 [Speaker 2]
Fantastic.

00:29:32 [Speaker 1]
Well, and it's gonna be really interesting.
00:29:34 [Speaker 1]
History will probably judge this.
00:29:36 [Speaker 1]
I'm gonna go ahead and quickie judge it and give him right call.
00:29:41 [Speaker 1]
Totally avoided the billions, if not trillions, of CapEx developing their own AI.
00:29:49 [Speaker 1]
He sat the sidelines out on that, focused on, to your point, operations, the ecosystem generating free cash from that.

00:29:58 [Speaker 1]
And now when you look at the treadmill that Anthropic, OpenAI are on, Facebook's Meta's on, etcetera, Google's on, and all the CapEx.
00:30:10 [Speaker 1]
I mean, he's gonna be able to acquire one of those companies if he wants.
00:30:14 [Speaker 1]
He's gonna be able to take a cheap Chinese model and train it for the Apple ecosystem if he wants.
00:30:22 [Speaker 1]
So, you know, there was a lot of talk that maybe Apple had had missed the, missed the boat on AI.
00:30:29 [Speaker 1]
And I think at this point, he looks pretty smart, but we'll see.

00:30:34 [Speaker 2]
I see what you did there, Chuck.
00:30:36 [Speaker 2]
Like, I'm not I mean, I'm I might not be the sharpest tool in the shed.
00:30:43 [Speaker 2]
Some people think I am, but but we all know.
00:30:46 [Speaker 2]
I see what you did here because what you're talking about is an oil and gas story is ExxonMobil.
00:30:53 [Speaker 2]
They never are first movers, but they have the best operations history, and they just write big checks when they want to, like XTO.

00:31:02 [Speaker 2]
Yeah.
00:31:03 [Speaker 2]
So is that what you're saying here?
00:31:05 [Speaker 2]
What's gonna what's ExxonMobil gonna do with Venezuela?
00:31:10 [Speaker 2]
Are they going back in?

00:31:12 [Speaker 1]
I don't know.
00:31:13 [Speaker 1]
That's a it it it does feel too early, too much political risk for a for an Exxon type move.
00:31:21 [Speaker 1]
I mean, I think you're gonna sit around and watch it more, kinda like Tim Cook's doing with AI.
00:31:27 [Speaker 1]
The interesting thing is, that approach, and let's bring it back to Chevron, That approach that Apple took under Tim Cook operations generate free cash, be very judicious in the allocation of capital led Warren Buffett to become one of their largest shareholders.
00:31:48 [Speaker 1]
And lo and behold, Buffett owns Chevron.

00:31:51 [Speaker 1]
Right?
00:31:52 [Speaker 1]
So

00:31:53 [Speaker 2]
Yeah.
00:31:53 [Speaker 2]
Let's, I mean, let's just because we can, because we're both unemployed.

00:31:58 [Speaker 1]
Because we got we don't have Mark here to sit here and tell us we can't do it.

00:32:03 [Speaker 2]
We can't do it.
00:32:04 [Speaker 2]
What is your view of Chevron?
00:32:06 [Speaker 2]
I mean, I like ConocoPhillips, I'm like, well, when they when they shed Phillips sixty six, now we're kinda today thinking what a dumb move there.
00:32:18 [Speaker 2]
But it makes sense because, you know, upstream and downstream, it's really hard to run both, but Shell's done a pretty good job.
00:32:27 [Speaker 2]
Of course, they're now a London based company, and now they're rethinking that one.

00:32:32 [Speaker 2]
What do you think of Chevron?
00:32:33 [Speaker 2]
They're they're they're an LA based oil and gas company.
00:32:38 [Speaker 2]
Where do they rank in terms of of super majors in your book?

00:32:45 [Speaker 1]
The so the thing let me go back to Conoco real quick because I do wanna make one point there.
00:32:51 [Speaker 1]
When Conoco bought Concho, I, you know, there there there was some, oh, did they overpay for Concho or whatever?
00:32:59 [Speaker 1]
But putting the former Concho guys, and what needed to be done in the Permian Basin in terms of just doing trades.
00:33:10 [Speaker 1]
Right?
00:33:10 [Speaker 1]
We've gotta do a trade so we can drill a three mile lateral instead of the one mile lateral.

00:33:17 [Speaker 1]
And watching them execute on that has been pretty impressive.
00:33:21 [Speaker 1]
So kudos to, to Conoco and the Permian team.
00:33:26 [Speaker 1]
That that's the one I've had some eyes on and gotten to see.
00:33:29 [Speaker 1]
So kudos.
00:33:30 [Speaker 1]
They've actually been pretty impressive there.

00:33:33 [Speaker 1]
You know, Chevron, you could make the

00:33:37 [Speaker 2]
I I

00:33:37 [Speaker 1]
definitely don't think you would put Chevron in BP's class.
00:33:41 [Speaker 1]
You certainly could say they were kinda rivaling Exxon in the in the Permian growing their stuff.
00:33:48 [Speaker 1]
I do really like the the recent pivot to, hey, man.
00:33:52 [Speaker 1]
We're gonna build a meta or Microsoft big data center because we're sitting on our gas.

00:33:58 [Speaker 2]
Maybe because they're California roots.

00:34:00 [Speaker 1]
Maybe so.

00:34:00 [Speaker 2]
Maybe they're California roots.

00:34:02 [Speaker 1]
There you go.
00:34:03 [Speaker 1]
They maybe they were the ones that walked down the road and went and talked to big tech like we've been arguing for, on BDE for the last three and a half years.

00:34:11 [Speaker 2]
Now I've gotta tell you, Chuck, none of this last segment was on Mark's run of show.
00:34:19 [Speaker 2]
He's probably flipping out right now.
00:34:21 [Speaker 2]
I he's not rage texting because he's clearly doing something else right now.
00:34:26 [Speaker 2]
But, I just want you to know that we've gone off script.
00:34:30 [Speaker 2]
We're gonna get pulled in next week.

00:34:32 [Speaker 2]
We're probably in trouble, but but I do we're in trouble.
00:34:37 [Speaker 2]
But here's what I want.
00:34:39 [Speaker 2]
It made me think about this.
00:34:42 [Speaker 2]
You know, in West Texas, there's always vertical wells.
00:34:46 [Speaker 2]
Right?

00:34:46 [Speaker 2]
Like, we just drilled holes straight down.
00:34:48 [Speaker 2]
When unconventional came into play, I wanna know the guy, and I wanna be in the room.
00:34:55 [Speaker 2]
We gotta pull one of these guys, and they're like, hey.
00:34:59 [Speaker 2]
Let's go under look.
00:35:01 [Speaker 2]
We're now able to drill horizontals.

00:35:05 [Speaker 2]
Let's go drill into somebody else's land because we can go sideways now.
00:35:10 [Speaker 2]
I wanna know that conversation and grab those guys.
00:35:14 [Speaker 2]
Not the not the, you know, the the guys wearing the vest in the boardroom, but the guys actually going, hey.
00:35:21 [Speaker 2]
We're going into Johnson's property.
00:35:23 [Speaker 2]
This is gonna be badass.

00:35:24 [Speaker 2]
Let's do it.
00:35:26 [Speaker 2]
What do you think, Chuck?

00:35:27 [Speaker 1]
Well, that the the interesting thing is, that's why Pedevasive has to have juice in the game.
00:35:35 [Speaker 1]
They've gotta have an override or something because you're, like, going, hey, man.
00:35:39 [Speaker 1]
I need to attach I need to hook into that tank battery, or I need you to shut in this old conventional field, and you go back to the animal house line.
00:35:48 [Speaker 1]
Right?
00:35:49 [Speaker 1]
You want my police?

00:35:50 [Speaker 1]
You have to pay.
00:35:51 [Speaker 1]
You know?
00:35:52 [Speaker 1]
I mean, that's that's, that that's why I think any of those deals, there's gonna be blah blah blah blah blah blah blah.
00:35:59 [Speaker 1]
And here you go, Pedevasive.
00:36:02 [Speaker 1]
Kinda reminds me of reminds me of when I went to Guatemala in college, and we were trying to figure out how to, how to go see certain ruins, Tikal.

00:36:12 [Speaker 1]
And everyone we talked to, we would, like, ask, hey.
00:36:15 [Speaker 1]
You know, how do we get there?
00:36:16 [Speaker 1]
Who do we talk to?
00:36:17 [Speaker 1]
What do we do?
00:36:18 [Speaker 1]
They all said, let me give you some advice.

00:36:21 [Speaker 1]
And they always ended with, and I would like a commission.
00:36:25 [Speaker 1]
Like, what?
00:36:27 [Speaker 1]
You're not even driving me in the truck or telling me where to fly?
00:36:30 [Speaker 1]
So yeah.
00:36:31 [Speaker 1]
I think we're going a lot of that.

00:36:34 [Speaker 2]
In fairness to Mark, we're going back to to The UK VP.
00:36:40 [Speaker 2]
I mean, we're we're just skipping across, but this next story that that Mark has asked us to talk about is the descent versus Druckenmiller and this big fight going on.
00:36:54 [Speaker 2]
What do you know about it?
00:36:55 [Speaker 2]
I can set it up, Chuck, but love me.

00:36:58 [Speaker 1]
You you you set it up.
00:36:59 [Speaker 1]
You're more the macro trader than I am.
00:37:02 [Speaker 1]
I mean, I've always taken the position on bonds are a bad thing.
00:37:06 [Speaker 1]
You gotta pay them back one day.

00:37:08 [Speaker 2]
Exactly.
00:37:10 [Speaker 2]
So there's this been this big fight going on between kind of let me step back for a second.
00:37:18 [Speaker 2]
1992, Soros Fund Management, George Soros, who we all know, who's crazy politically, Stanley Druckenmiller, and a young trader named Scott Bissett sat in the same room.
00:37:31 [Speaker 2]
This is 1992.

00:37:33 [Speaker 1]
K.

00:37:33 [Speaker 2]
Their thesis is the Bank of England was artificially defending the pound's peg to the to the European exchange rate mechanism.
00:37:44 [Speaker 2]
The fundamentals did not support the peg.
00:37:47 [Speaker 2]
The UK was spending billions in reserves to hold a price the market didn't believe in.
00:37:53 [Speaker 2]
So Druckenmiller's conviction was governments defending prices against fundamentals always lose, always.
00:38:01 [Speaker 2]
So what did they do?

00:38:02 [Speaker 2]
They shorted the pound.
00:38:03 [Speaker 2]
On 09/16/1992, Black Wednesday, the Bank of England collapsed the peg.
00:38:11 [Speaker 2]
Soros Fund made over $1,000,000,000 in one day.
00:38:14 [Speaker 2]
It was the most famous macro trade in history.
00:38:19 [Speaker 2]
So Druckenmiller was the architect.

00:38:21 [Speaker 2]
Besent was in the room.
00:38:23 [Speaker 2]
They're on the same side of the trade that proved the principle you cannot defend an unsustainable price of government resources.
00:38:31 [Speaker 2]
So thirty four years later, the student is now the treasury secretary of The United States, and the teacher just told him publicly that he is making the same mistake the Bank of England made.
00:38:44 [Speaker 2]
So what's the feud?
00:38:46 [Speaker 2]
On August 19, Besant announces Treasury would double long dated bond buybacks from 2,000,000,000 to 4,000,000,000 per operation, targeting the ten to thirty year maturities scheduled September 9 through November 4.

00:39:03 [Speaker 2]
So what's going on here is that Truckenmiller's back and saying this was this isn't he's basically calling Scott Bissett out saying you're making the same mistake as the Bank of England, and it's gonna come and bite you in the ass.
00:39:19 [Speaker 2]
So it's a great fight going on.
00:39:22 [Speaker 2]
I don't know if you have any thoughts on this, Chuck.
00:39:25 [Speaker 2]
I can tell you a little bit more about it, but I just think this is hilarious.
00:39:29 [Speaker 2]
I,

00:39:31 [Speaker 1]
I'm kind of in drunken miller's, camp on this in that a $4,000,000,000 buyout or buyback when you're sitting there issuing $4,800,000,000,000 a year in bonds.
00:39:45 [Speaker 1]
Kind of feels like you're trying to drain the Gulf Of America with a Whataburger cup.
00:39:51 [Speaker 1]
So I'll, I'll I'll I'll kinda say say that.
00:39:58 [Speaker 1]
You know, the the one thing you do have to do, though, when you make a trade like this and, I'll give Bob Sonat, the former CEO of Cain, credit for this because I used to come in there and go, oh, we should short this company.
00:40:10 [Speaker 1]
It's so horrible.

00:40:12 [Speaker 1]
And Bob would always say, alright.
00:40:13 [Speaker 1]
What is the event that causes the market to see this company like you do?
00:40:20 [Speaker 1]
And, you know, so the the point meaning is there's timing involved in this and the cost of carry and all.
00:40:29 [Speaker 1]
And so, Scott does have some widgets he can play with, but, I think I think you're right.
00:40:35 [Speaker 1]
At 40,000,000,000,000, we're fucked.

00:40:37 [Speaker 1]
I mean, it's game over.

00:40:40 [Speaker 2]
I think what we established, at least on our show, and we keep kind of complaining and throwing shade at at our secretary of the treasury, is Scott Bessent two weeks ago said, I don't really understand why oil went up.
00:40:58 [Speaker 2]
And now he's predicting it'll come down.
00:41:02 [Speaker 2]
And so the man clearly is not doesn't understand the micro when we went into those details.
00:41:08 [Speaker 2]
So now he's trying to be mister macro again, and and I think he's really headed and his mentor is calling bullshit on him.
00:41:19 [Speaker 2]
I think he's running into a really dangerous ground here, and I think it's gonna come back to bite him and us because he's basically trading our money.

00:41:31 [Speaker 1]
Exactly.
00:41:31 [Speaker 1]
The the one kinda interesting tidbit on this whole thing is Stan, who's 73 years old, right, claims he did use AI to help write the editorial.
00:41:44 [Speaker 1]
So

00:41:44 [Speaker 2]
No way.
00:41:45 [Speaker 2]
Yeah.
00:41:45 [Speaker 2]
You're kidding me.

00:41:46 [Speaker 1]
Yeah.
00:41:46 [Speaker 1]
That was was it Grok?
00:41:48 [Speaker 1]
Was it Chat GPT?
00:41:49 [Speaker 1]
Was it Claude?
00:41:50 [Speaker 1]
I'd I'd

00:41:51 [Speaker 2]
I'd love to know.
00:41:52 [Speaker 2]
Or Gemini of all things.

00:41:54 [Speaker 1]
Or Gemini.
00:41:55 [Speaker 1]
Yeah.
00:41:55 [Speaker 1]
Ain't that great?
00:41:56 [Speaker 1]
Some guy sitting there on his cell phone writing an editorial to flame the entire United States and move the markets.
00:42:03 [Speaker 1]
And, it's chat GPT.

00:42:05 [Speaker 1]
Hopefully, at least or or or it's Claude.
00:42:09 [Speaker 1]
Hopefully, at least he used Fable.
00:42:11 [Speaker 1]
And

00:42:13 [Speaker 2]
You know, I bet I bet his grandkids probably just looked up the the the looked up the argument and and and went to grandpapa and said, blah blah blah blah.
00:42:24 [Speaker 2]
And they're like, holy she's like, holy shit.
00:42:26 [Speaker 2]
This is pretty good.
00:42:26 [Speaker 2]
It's better than I even I don't even remember some of this.
00:42:31 [Speaker 2]
Yeah.

00:42:31 [Speaker 2]
I'm gonna use AI to write a reply.

00:42:34 [Speaker 1]
Exactly.
00:42:35 [Speaker 1]
Wouldn't that be cool if the two agents, two bots were just going back and forth in the New York Times?

00:42:42 [Speaker 2]
That's so good.
00:42:43 [Speaker 2]
I've got well, speaking of, I've got bots running now fighting each other because I hate them.
00:42:49 [Speaker 2]
Hey.
00:42:49 [Speaker 2]
We have a question, by the way.

00:42:51 [Speaker 1]
Alright.

00:42:52 [Speaker 2]
If Venezuela genuinely reopens to international oil companies, where do you think the first real opportunity will be?
00:43:00 [Speaker 2]
Upstream operators, oilfield services, infrastructure, or technology?
00:43:06 [Speaker 2]
And that's question on LinkedIn.
00:43:08 [Speaker 2]
I don't know who Adder Adderman, That's that's the question.
00:43:17 [Speaker 2]
What do you think, Chuck?

00:43:20 [Speaker 1]
The service companies always scare me.
00:43:23 [Speaker 1]
You know?
00:43:23 [Speaker 1]
It's usually the E and P companies on steroids.
00:43:27 [Speaker 1]
Right?
00:43:27 [Speaker 1]
So if things are really good, okay, they do better.

00:43:30 [Speaker 1]
If things are really bad, they do way worse.
00:43:33 [Speaker 1]
That always scares me.
00:43:35 [Speaker 1]
The E and P guys' concessions, I mean, they're gonna be a we know a lot about shales, but they're gonna be a a lot of learnings there and, that sort of stuff.
00:43:46 [Speaker 1]
So you know who's gonna make the most money?
00:43:49 [Speaker 1]
The Venezuelan prostitutes.

00:43:51 [Speaker 1]
That's where I go long.

00:43:54 [Speaker 2]
Dude, not even an option on the question, and Chuck just just throws the greatest answer from left field.
00:44:03 [Speaker 2]
That was fantastic.
00:44:05 [Speaker 2]
Well, I I I mean, for me, of course, who you know, I'm thinking of the California Gold Rush for a second.
00:44:12 [Speaker 2]
Whoever's selling the picks and shovels is always the winner.
00:44:16 [Speaker 2]
Now maybe not the biggest, like, IRR, but in terms of cash on cash return, because, Chuck, you care about cash on cash return more than anything else.

00:44:27 [Speaker 2]
It's the oilfield service guys.
00:44:29 [Speaker 2]
It's not even close.
00:44:31 [Speaker 2]
Because the upstream guys are not going first because, you know, the CEO of Exxon said it's that that Venezuela is uninvestable, and ConocoPhillips has $12,000,000,000 in claims.
00:44:47 [Speaker 2]
So I think the operators upstream guys are really just kinda have to wait and see.
00:44:55 [Speaker 2]
So that's number one.

00:44:56 [Speaker 2]
Number two is guess who's already on the ground there.
00:45:00 [Speaker 2]
The the oilfield service guys, they're the guys that hire the hookers in the first place, or maybe they actually are the hookers.
00:45:08 [Speaker 2]
Maybe that's what you're saying, Chuck.
00:45:10 [Speaker 2]
Are you calling midst the oilfield service guys the hookers?

00:45:14 [Speaker 1]
Wow.
00:45:16 [Speaker 1]
I gotta be careful here.
00:45:17 [Speaker 1]
We need to sell them software.
00:45:19 [Speaker 1]
No.
00:45:19 [Speaker 1]
Of course not.

00:45:22 [Speaker 1]
Of course not.
00:45:24 [Speaker 1]
Senator, I can neither confirm nor deny any said allegations.

00:45:29 [Speaker 2]
The, But but but but the good news is because they're oilfield service guys, they might even call in right now from Venezuela to give us an update.
00:45:38 [Speaker 2]
Hopefully, if they're listening, well, I'm sure there's very bad, infrastructure down there.
00:45:44 [Speaker 2]
So if they're they're probably not really listening.
00:45:48 [Speaker 2]
If they were, they'd call us right now because we know plenty of those guys.

00:45:52 [Speaker 1]
Yep.
00:45:54 [Speaker 1]
Somewhere, somehow, I wonder what Archie Dunham is doing as we speak.
00:45:59 [Speaker 1]
So there we go.

00:46:03 [Speaker 2]
We're we're down to the lightning round, Chuck.

00:46:06 [Speaker 1]
Oh, right.
00:46:06 [Speaker 1]
We we still have more?
00:46:08 [Speaker 1]
Wow.

00:46:09 [Speaker 2]
We have a few things.
00:46:10 [Speaker 2]
I feel like it's screwed in the SBR by the end.

00:46:13 [Speaker 1]
I feel like this is the sham ShamWow guy.
00:46:17 [Speaker 1]
And then there's more.
00:46:19 [Speaker 1]
So alright.
00:46:20 [Speaker 1]
Fire away.

00:46:20 [Speaker 2]
I'm just trying to not I mean, I'm just trying to, like, get Mark's already on blood pressure meds.
00:46:26 [Speaker 2]
I'm just trying to get it down.
00:46:28 [Speaker 2]
So I

00:46:28 [Speaker 1]
did I did get a text from him that said I heard that.
00:46:32 [Speaker 1]
So Alright.
00:46:34 [Speaker 1]
Go ahead.
00:46:35 [Speaker 1]
Lightning round.

00:46:36 [Speaker 2]
Venezuela Venezuelan crude in the SPR by year end.
00:46:41 [Speaker 2]
Hell no.
00:46:42 [Speaker 2]
Number one is it's too heavy.
00:46:45 [Speaker 2]
So if we put it into one of these salt caverns, it's gonna plug it up and sit at the bottom.
00:46:52 [Speaker 2]
So it needs to be refined anyway to put in the SPR.

00:46:55 [Speaker 2]
So that's hell no.

00:46:56 [Speaker 1]
Yeah.
00:46:56 [Speaker 1]
Alright.
00:46:57 [Speaker 1]
That that that being said, it may be traded for some barrels, but I even doubt that.
00:47:01 [Speaker 1]
But

00:47:02 [Speaker 2]
I love that.
00:47:02 [Speaker 2]
That's a great point.
00:47:03 [Speaker 2]
Yeah.
00:47:03 [Speaker 2]
Chuck, that's probably the most insightful thing we've said on the show in at least thirty minutes.

00:47:10 [Speaker 1]
Once again, I have stumbled upon the answer.

00:47:13 [Speaker 2]
Brent, higher or lower ninety days from now?

00:47:18 [Speaker 1]
I'll say higher.
00:47:20 [Speaker 1]
It's gotta be higher.
00:47:21 [Speaker 1]
I I don't I don't see I don't see Iran clearing up anytime soon, and it's just gotta follow.
00:47:30 [Speaker 1]
Right?
00:47:31 [Speaker 1]
What do you what do you think?

00:47:33 [Speaker 2]
I mean, Hormuz is contested.
00:47:36 [Speaker 2]
The diesel crack is still above 90.
00:47:40 [Speaker 2]
Russian exports banned Russia infrastructure sucks.
00:47:45 [Speaker 2]
Winter coming, and not the Game of Thrones version.
00:47:50 [Speaker 2]
I see everything says price is going up.

00:47:55 [Speaker 1]
Yeah.
00:47:55 [Speaker 1]
I mean, well, let's

00:47:57 [Speaker 2]
Drunken Miller or Well,

00:47:58 [Speaker 1]
let well, let's just put it this way.
00:48:01 [Speaker 1]
If prices can't go up now, that's it.
00:48:04 [Speaker 1]
Game over.
00:48:05 [Speaker 1]
We should just we should just quit.
00:48:07 [Speaker 1]
If all the stars align

00:48:09 [Speaker 2]
Back to the back to the drunken Miller of percent on the bond play, and we just sort of answered it.
00:48:15 [Speaker 2]
Drunken Miller, not even close.
00:48:17 [Speaker 2]
Because when you have government trying to fix prices or trying to play the game, who lose?
00:48:23 [Speaker 2]
We all do.

00:48:24 [Speaker 1]
We all do.

00:48:25 [Speaker 2]
Well, actually, whoever shorts takes the other position, then the government's the big winner.
00:48:31 [Speaker 2]
Let's just, we should probably watch that and and report next week.

00:48:35 [Speaker 1]
Yep.
00:48:35 [Speaker 1]
That, that we will.
00:48:36 [Speaker 1]
$40,000,000,000,000 in debt.
00:48:39 [Speaker 1]
I mean, for what?
00:48:42 [Speaker 1]
$40,100 Every time

00:48:44 [Speaker 2]
I try to defend million.
00:48:46 [Speaker 2]
Every time I try to defend the Republicans because I'm like, well, they're conservative economically, and they're the ones that spend the most money a lot of times.
00:48:55 [Speaker 2]
Not on, you know, not on these stupid, you know, social programs, but it's on bullshit that, like, for instance, is the bot or on the war.
00:49:09 [Speaker 2]
So

00:49:09 [Speaker 1]
Yeah.
00:49:10 [Speaker 1]
No.
00:49:10 [Speaker 1]
I mean, we definitely, we definitely do a lot of, of going to war, spend a lot on the military.
00:49:17 [Speaker 1]
I mean, don't we spend more on our military than all the rest of the world combined?

00:49:23 [Speaker 2]
Yeah.
00:49:23 [Speaker 2]
It's a great vendor.
00:49:25 [Speaker 2]
I mean, it's just lining pockets of friends.

00:49:27 [Speaker 1]
Yeah.
00:49:28 [Speaker 1]
And and as much as, I hate to say this, you know, a lot of this traces back to we gotta give Bill Clinton and Newt Gingrich a lot of credit.
00:49:40 [Speaker 1]
I mean, they balanced the budget.
00:49:41 [Speaker 1]
They came together.
00:49:42 [Speaker 1]
They figured out how to do it.

00:49:44 [Speaker 1]
George Bush took over, and there was, hey.
00:49:47 [Speaker 1]
We're really gonna start paying down some, some debt.
00:49:51 [Speaker 1]
And the Republicans won back the house, and they went and scraped campaign dollars up and down the lobbyist.
00:50:03 [Speaker 1]
And, anyway, George Bush and that congress started running debts that have just been ever escalating ever since.
00:50:10 [Speaker 1]
And so I am a big fan of George Bush, but he put us on a bad path.

00:50:15 [Speaker 1]
Tom delayed it and helped any.
00:50:17 [Speaker 1]
And so, yes, you're right to throw, stones at the Republicans too.

00:50:24 [Speaker 2]
I mean, I even remember I mean, I'm gonna go throw an old reference.
00:50:28 [Speaker 2]
Remember Buchanan

00:50:30 [Speaker 1]
Pat.

00:50:31 [Speaker 2]
Who Pat Buchanan who ran on an isolationist platform.
00:50:37 [Speaker 2]
And I was like, hell yes.
00:50:40 [Speaker 2]
I was in college back then.
00:50:41 [Speaker 2]
I was thinking, what a great idea.
00:50:44 [Speaker 2]
Screw paying every the rest of the world to be part of these United Nations.

00:50:50 [Speaker 2]
Screw this giant military complex.
00:50:53 [Speaker 2]
I mean, I do I'm big on having a big defense, but going into waging war in Ukraine, are you kidding me?

00:51:02 [Speaker 1]
So here's a here's a crazy stat.
00:51:05 [Speaker 1]
Let's put a trillion into perspective.
00:51:08 [Speaker 1]
So a million seconds is twelve days.
00:51:11 [Speaker 1]
A billion seconds is thirty two years.

00:51:15 [Speaker 2]
A

00:51:15 [Speaker 1]
trillion seconds is thirty two thousand years, and the cavemen were painting horses on the walls back then.
00:51:24 [Speaker 1]
Forty trillion seconds ago, we hadn't even invented the human.
00:51:34 [Speaker 1]
How crazy is that?
00:51:36 [Speaker 1]
Stan Stan

00:51:37 [Speaker 2]
Well said.

00:51:38 [Speaker 1]
Stan wins this trade.
00:51:39 [Speaker 1]
Stan wins this trade.
00:51:41 [Speaker 1]
Alright, folks.
00:51:42 [Speaker 1]
If you enjoyed today's show, please go ahead and just say, yeah.
00:51:46 [Speaker 1]
We didn't miss Mark at all.

00:51:50 [Speaker 1]
No.
00:51:50 [Speaker 1]
We missed Mark.
00:51:51 [Speaker 1]
Mark, come back soon.

00:51:54 [Speaker 2]
Yeah.
00:51:54 [Speaker 2]
I miss you, Mark.
00:51:56 [Speaker 2]
I heard that.
00:51:56 [Speaker 2]
We heard you loud and clear.
00:52:00 [Speaker 2]
So, Mark, next week, just bring it you just gotta bring yourself.

00:52:04 [Speaker 2]
We'll just If you don't like what you heard, come back.

00:52:07 [Speaker 1]
May not let us join next week.
00:52:09 [Speaker 1]
It may just be an hour of Mark and gravitas.
00:52:12 [Speaker 1]
But

00:52:13 [Speaker 3]
I do have extras for y'all.

00:52:16 [Speaker 1]
You have what for us?

00:52:17 [Speaker 3]
First off, you had an image you wanted me to show.
00:52:19 [Speaker 3]
Is that still relevant?

00:52:20 [Speaker 1]
Oh, yeah.
00:52:20 [Speaker 1]
We gotta pop this up.
00:52:21 [Speaker 1]
So, our Yeah.
00:52:23 [Speaker 1]
This is This is this is, Vlad.
00:52:26 [Speaker 1]
Vlad is our, biggest fan, the Richmond police officer.

00:52:30 [Speaker 1]
He was out, about boating, and he saw a Kinder Morgan sign.
00:52:34 [Speaker 1]
So he wanted a BD shout out and sent me the picture.
00:52:38 [Speaker 1]
He asked me to do something crazy with AI with it, and I just didn't get around to it.
00:52:43 [Speaker 1]
So sorry, Vlad.
00:52:44 [Speaker 1]
We'll work on that for next week.

00:52:46 [Speaker 1]
But there he goes.
00:52:47 [Speaker 1]
That's Vlad.

00:52:48 [Speaker 3]
I also cooked up an idea when y'all y'all were kinda ranking the, majors.
00:52:53 [Speaker 3]
Right?

00:52:53 [Speaker 1]
Yeah.
00:52:54 [Speaker 1]
What what

00:52:54 [Speaker 3]
if we did a a impromptu tier list here?

00:52:57 [Speaker 2]
Oh.
00:52:59 [Speaker 2]
Oh, this is fantastic.
00:53:01 [Speaker 2]
Let's get the fans let's get the audience to vote on this.

00:53:05 [Speaker 1]
Oh, yeah.
00:53:05 [Speaker 1]
There you go, Jacob.
00:53:06 [Speaker 1]
Run a run a poll of your man, we can we can structure it as a fantasy football draft of majors if we want.

00:53:16 [Speaker 2]
Let's do it.
00:53:17 [Speaker 2]
Yeah.
00:53:17 [Speaker 2]
Yes.

00:53:18 [Speaker 3]
I don't I don't know if we have, everyone tuned in ready to go, but, if y'all wanted to do it this tier list for now, we could set up a poll, next show.

00:53:27 [Speaker 1]
I'm try

00:53:27 [Speaker 2]
Well, I'm going E and I.
00:53:29 [Speaker 2]
E and I, of course, in the top because of the Visa.
00:53:32 [Speaker 2]
I mean, come on, dude.

00:53:33 [Speaker 1]
They, well, I'm not gonna say anything because I'm trying to sell them all software.

00:53:38 [Speaker 2]
But So

00:53:38 [Speaker 3]
here we go.
00:53:39 [Speaker 3]
Here we go.

00:53:40 [Speaker 1]
There we go.
00:53:40 [Speaker 1]
Yeah.
00:53:40 [Speaker 1]
They're all great.
00:53:42 [Speaker 1]
They all have wonderful IT department.

00:53:45 [Speaker 2]
Well, let let's be, What about the French?
00:53:48 [Speaker 2]
I'm I'm I'm I'm blanking.
00:53:50 [Speaker 2]
Who's the person that, oh, let's be speaking of golf, Goodgood and the CEO, Matt Kendrick, who after their dumb ad that that, I don't know if you you guys follow this, but it's kinda crazy on the golf influencer world.
00:54:09 [Speaker 2]
But after the big companies don't buy your software, Chuck, you just go and start trash talking them.
00:54:20 [Speaker 2]
It doesn't work, by the way, but it's it's now if you're young, that's a new strategy.

00:54:25 [Speaker 1]
The, my business partner and dear sweet friend in this endeavor, I think, pioneered that strategy.
00:54:33 [Speaker 1]
And so we don't need to give Colin any encouragement on that.
00:54:37 [Speaker 1]
Fortunately, he's not No.
00:54:38 [Speaker 1]
He's not watching BDE today.
00:54:40 [Speaker 1]
So

00:54:42 [Speaker 2]
You know, every time I see like, I I follow some Instagram handle that's, like, rage driving in Houston, and every time I see a video of a guy on a four wheeler or a or a uni wheeler going being chased by cops in Houston, I'm always thinking, is that Is that frack slap?

00:55:06 [Speaker 1]
It always is.
00:55:08 [Speaker 1]
Alright, everybody.
00:55:09 [Speaker 1]
Things.

00:55:10 [Speaker 3]
We got this Chuck, new old man coffee.
00:55:12 [Speaker 3]
Shout out.

00:55:13 [Speaker 1]
Yep.
00:55:13 [Speaker 1]
Yep.
00:55:14 [Speaker 1]
The, the boring two thirds.
00:55:17 [Speaker 1]
This was you'll you'll like reading this one, Kirk.
00:55:20 [Speaker 1]
I got, schooled by a CEO I greatly respect telling me how stupid my sales pitch was.

00:55:28 [Speaker 1]
And so

00:55:31 [Speaker 3]
And lastly

00:55:34 [Speaker 1]
Oh, front in person.
00:55:35 [Speaker 1]
Yeah.
00:55:36 [Speaker 1]
Thursday night.
00:55:37 [Speaker 1]
I'm, I'm keynoting the Houston AI Club.
00:55:42 [Speaker 1]
They've got the ion booked out, and I think they're up to 500 people are gonna be there.

00:55:48 [Speaker 1]
And, so I will, Kirk, since since, probably only my mom and Vlad are listening at this point after we've destroyed the show, I'll give you the little heads up.
00:56:00 [Speaker 1]
I'm actually gonna kick off my speech singing it's the end of the world as we know it by REM.

00:56:07 [Speaker 2]
And I

00:56:07 [Speaker 1]
feel fine.
00:56:08 [Speaker 1]
Feel fine.
00:56:08 [Speaker 1]
Exactly.
00:56:10 [Speaker 1]
Cool.
00:56:10 [Speaker 1]
Hey, everybody.

00:56:11 [Speaker 1]
Appreciate you guys joining us today.
00:56:14 [Speaker 1]
Mark will be back.
00:56:15 [Speaker 1]
We will have some gravitas and serious thoughts, next week.
00:56:19 [Speaker 1]
Kirk, it's always fun.

00:56:22 [Speaker 2]
Dude, great to see you, and I'm getting a call from an oilfield service guy in Venezuela.
00:56:27 [Speaker 2]
He he's he's been trying for thirty minutes to get through.
00:56:31 [Speaker 2]
So there you go.

00:56:32 [Speaker 1]
Report back next week.
00:56:33 [Speaker 1]
Alright, Jacob.
00:56:34 [Speaker 1]
Kick us off.