Tuesday, April 27, 2010

Fort Berthold Indian Reservation Update -- April 27, 2010


August 2, 2010: Connecting the dots -- the Arrow Pipeline. MHA, SHD, XOM, XTO, KOG, QEP.

April 28, 2010: #18968/#18969, Petro-Hunt, Fort Berthold 148-95-22D-15-1H/Fort Berthold 148-95-27A-34-1H/ new permits, NDIC.  Two wells on same pad. Both wildcats. Interesting.

April 28, 2010: KOG, Moccasin Creek 16-3-11H, #18295, reports 1,260 bopd, NDIC.


It is ironic that the location where "the Bakken" was discovered has been lagging in activity. Until now. See Minot Daily News.

The first "real" horizontal Bakken well was drilled in 2006. The well was inside the reservation and yet it is only now, 2010 and 2011, when the oil activity inside the reservation will finally catch up with activity in the rest of the Bakken outside the reservation.

For the past few months now I  have been posting this little nugget: 2010 should be a watershed year for Fort Berthold Indian Reservation.

It is my impression that FBIR is two years behind the rest of the Bakken, particularly the prolific Sanish ("owned" by Whiting) and Parshall ("owned" by EOG) oil fields, because of (artificial) bureaucratic obstacles in Washington, DC. North Dakota Senator Dorgan is credited with removing those obstacles and it appears the federal regulatory process for granting permits in the reservation now has a similar timeline to that of the state.

It is my impression, based on permits granted, and the number of rigs in the reservation, that 2010 - 2011 will be the time period in which the reservation catches up with the rest of the Bakken.

With that as background, I was thrilled today to see the very lengthy article in Minot's local paper about the activity on-going in the reservation. It is absolutely incredible.  [Update. September 21, 2010: as predicted, this link is now broken. I find it amazing how local newspapers don't archive these articles. Fortunately I posted the main points from the article below.]

You may want to cut and paste pertinent information from this article. Some of these articles are archived after a few weeks and they become hard to find. Some sites only allow access to archives through a subscription, albeit, some are free.

Unless I missed it, the article did not mention the refinery that is still on track for the reservation.

From the article

  • Producing wells inside the reservation: 41 (seems low, actually; thus, huge potential)
  • Active rigs inside the reservation: 20
  • Oil companies working inside the reservation: 16. Instead of listing all those inside the reservation, it is easier to note the notable exception: Whiting. Others I don't see: NOG, AEZ, Fidelity. Of course, EOG is there; EOG is everywhere. Companies I associate with the reservation: KOG and its partners, Slawson and XTO. 
Definitions from the article:
  • Tribal land: land inside the reservation owned by the Three Affiliated Tribes
  • Allotted land: land inside the reservation owned by individual Indians
  • Fee land: land NOT held in trust by US government
  • Trust land: land held in trust by US government; can be tribal or allotted
Applications for New Permits:
  • Applications for new permits: 175 pending (as of date of interview for story)
  • Applications approved for new permits: 92 (as of date of interview for story) 
  • Compare: in 2008, there were 14 permits (versus 92) approved -- obstacles? Yes.
  • For perspective: "we" are on track for 1200 permits to be issued in North Dakota this year (2010); that averages about 3 new permits/day; the most permits granted in one year in current boom was about 950 in 2008; there were about 630 permits granted in 2009
Acreage, Mineral Rights and Management:
  • Acres leased in the reservation: 502,862 (total FBIR acreage: slightly less than 1 million)
  • Most of the tribes' mineral rights are under water (the lake is controlled by US Army Corps of Engineers) -- somehow that doesn't surprise me -- very, very sad
  • Comment: most folks who opine on this issue say that the Corps has been responsive and helpful
  • Bureaucratic process: the process to drill a well on federal land in the Bakken is a 49-step process
  • The Minerals Registration Act of 1984 returned the minerals under Lake Sakakawea to the Three Affiliated Tribes -- I wonder who made up the ND congressional delegation to right this wrong?
  • There are wells being drilled under the lake; south of Parshall and in the Mandaree areas; I assume "they" should have more than enough water for fracking
  • First "real" Bakken well: Parshall 1-36, April, 2006, was the first real successful well that utilized horizontal drilling in the Bakken
Issues that affect drilling in the reservation:
  • Taxes and wealth distribution
  • Federal mandates: encourage self sufficiency of the reservations but maintain their national park-like image

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