Sunday, May 1, 2011

Osama Bin Laden Killed -- Headline News

Being reported on television now.

Huge kudos to CIA, military intelligence, drone operators, military translators, special ops, US military in general.

Wow! Stock market futures just went through the roof.

End of Original Post

Added Monday, May 2, 2011

Administration spokesmen say this will have huge impact on the "war on terror."

Flashback

March 25, 2009: Current administration wants to jettison the phrase "war on terror."
The Obama administration appears to be backing away from the phrase "global war on terror," a signature rhetorical legacy of its predecessor.

In a memo e-mailed this week to Pentagon staff members, the Defense Department's office of security review noted that "this administration prefers to avoid using the term 'Long War' or 'Global War on Terror' [GWOT.] Please use 'Overseas Contingency Operation.' "
Comments

This helps explain the timing of the announcement of Robert Gates as SecDef, who no doubt was looking for the right time to announce his retirement, something he had said he would do from the beginning of his tenure as SecDef. He can leave on a very, very high note. Also, huge kudos to Leon Panetta, the director of the CIA on the night/day when this mission went down. No doubt he was the one to give the final "go" for the mission after getting approval from his boss to go ahead when the time was right. From what little has been said so far, it appears every strategic decision was the right one, particularly: a) no prisoners; shoot to kill; and, b) squelch any possibility of a shrine; burial at sea.

The rules of engagement (shoot to kill) most likely contributed to high probability of success. The SEALS did not have to decipher or second-guess "commander's intent."

American Stock Market Reaction: At the End fo the Day -- Muted

Many (including me) expected an emotional run-up in the stock market today. That did not happen; the market closed flat to slightly negative. One can argue that had Osama bin Laden been killed eight years ago, the stock market might have reacted differently, but for all intents and purposes, OBL's potential impact on world events had pretty much been neutralized by 2011. But as the president said, "Justice is done."

Spain's Unemployment: 21% -- Absolutely Incredible -- Nothing To Do With The Bakken

Absolutely nothing to do with the Bakken, but I would hate to see the unemployment numbers if the EPA puts onshore drilling out of business. Unless I'm missing something, the EPA could essentially shut down all drilling in this country. But I'm putting nothing past this administration. With GDP growth at a miserably low 1.8 percent this past quarter, shutting down the domestic oil industry would have to result in negative GDP growth, and higher oil prices almost overnight. But again, perhaps I'm overreacting.
Spain's unemployment rate rose nearly a point to 21.29%, with 4.9 million jobless for the first quarter of 2011, the government reported Friday, as the prolonged economic crisis continues to squeeze the nation.
Link here.

CLR's First Economically Successful Well: The Robert Heuer 1-17R -- Bakken, North Dakota, USA

From page 7 of CLR's 2010 annual report:
Continental completed the first economical horizontal well in the North Dakota Bakken utilizing multi-stage fracture stimulation—the Robert Heuer 1-17R in Divide County in March 2004.
This is quite an interesting story.

The permit for this well is #8201 ("we" are currently in the "20,xxx" file numbers). This well was spudded in 1981 targeting the Madison formation; it was dry.

Harold Hamm re-entered the well on 12/26/03 targeting the Bakken. Its IP was ..... drum roll ... 87.

Yup, 87 bopd was the IP, and to date, after seven years of producing without missing a day, except for one workover, this well has produced a grand total of 78,863 barrels of oil.

And it was Harold Hamm's first economically successful well in the Bakken. I used to think that 100,000 bbls was the critical milestone, but this well has accomplished what it needed to at much less.

Think about that. The price of oil has been nowhere near $100 for most of the past seven years. SemCrude prices only go back to 2001 (and Murphy oil prices back to August, 2009). In April, 2001, WTI oil was going for $24/bbl. Yes, that's right, $24/bbl.  By February,  2009, North Dakota sweet was down to $19.10.

If a well with an IP of 87 and total production under 80,000 bbls can be economically successful at a time when oil was well under $40/bbl, can you imagine what current wells are doing?

Then, look at the production data below. See if you notice the same thing I noticed? The original re-entry had the usual horrible Bakken decline, going from 2,400 bbls/month to 500 bbls/month, but then it leveled off at 500 bbls/month after it had paid for itself.  500 x $100 --> $50,000/month for a well that has paid for itself.

Then, notice that several months ago, November, 2010, the well was taken off-line. One assumes that it was re-fracked (or whatever workover rigs are able to do) and monthly production doubled what it did when it was first re-entered back in 2003, up to 4,000 bbls/month, or 4,000 x $80 --> $320,000/month.

Much more could be said about this, but the facts speak for themselves, and explains why some folks want a reassessment of the Bakken, based on new technology and re-entering old holes, and re-working recent wells.

There is one more "secret" which makes this well even more profitable than the production runs will show but that's for a different posting. Maybe someone will provide that detail in the comment section. I have reasons why I won't. (It's like the 4:30 TV ad teasing you with the 5:00 headline news. Smile.)

By the way, this well is not in what I would call the "core Bakken." It is well north of Tioga, about 12 miles northeast of Wildrose, North Dakota.



Robert Heuer 1-17R


NDIC File No: 8201     API No: 33-023-00186-00-00     CTB No: 108201
Well Type: OG     Well Status: A     Status Date: 3/5/2004     Wellbore type: Horizontal Re-Entry
Location: SESE 17-161-95     Footages: 600 FSL 822 FEL     Latitude: 48.765628     Longitude: -103.030310
Current Operator: CONTINENTAL RESOURCES, INC.
Current Well Name: ROBERT HEUER 1-17R
Elevation(s): 2365 KB   2347 GL     Total Depth: 13249     Field: SADLER
Spud Date(s):  1/11/1981  12/26/2003
Casing String(s): 9.625" 1618'   7" 8873'  
Completion Data
   Pool: BAKKEN     Perfs: 8873-13249OH     Comp: 3/5/2004     Status: F     Date: 3/5/2004     Spacing: SEC
   Pool: MADISON     Comp: 2/13/1981     Status: DRY     Date: 2/13/1981
Cumulative Production Data
   Pool: BAKKEN     Cum Oil: 78863     Cum MCF Gas: 140201     Cum Water: 24260   
Production Test Data
   IP Test Date: 3/31/2004     Pool: BAKKEN     IP Oil: 87     IP MCF: 150     IP Water: 146



Production history:
Monthly Production Data
Pool Date Days BBLS Oil Runs BBLS Water MCF Prod MCF Sold Vent/Flare
BAKKEN 2-2011 26 4089 4628 1514 3218 3218 0
BAKKEN 1-2011 29 4778 4207 2739 3514 3514 0
BAKKEN 12-2010 31 1719 1185 2691 1561 1561 0
BAKKEN 11-2010 3 38 196 5 47 47 0
BAKKEN 10-2010 31 520 375 133 527 527 0
BAKKEN 9-2010 30 537 555 145 513 513 0
BAKKEN 8-2010 31 513 560 148 520 520 0
BAKKEN 7-2010 31 477 569 140 510 510 0
BAKKEN 6-2010 30 519 555 207 349 349 0
BAKKEN 5-2010 31 543 563 143 421 421 0
BAKKEN 4-2010 30 512 399 123 433 433 0
BAKKEN 3-2010 29 512 564 105 634 634 0
BAKKEN 2-2010 28 493 376 110 562 562 0
BAKKEN 1-2010 31 565 533 115 633 633 0
BAKKEN 12-2009 31 564 571 122 975 975 0
BAKKEN 11-2009 30 551 604 127 618 618 0
BAKKEN 10-2009 31 575 552 130 611 611 0
BAKKEN 9-2009 30 551 569 155 620 620 0
BAKKEN 8-2009 31 593 612 137 666 666 0
BAKKEN 7-2009 26 562 572 188 601 601 0
BAKKEN 6-2009 30 534 613 151 663 663 0
BAKKEN 5-2009 27 569 682 176 690 690 0
BAKKEN 4-2009 30 586 890 137 868 868 0
BAKKEN 3-2009 31 574 457 134 2196 2196 0
BAKKEN 2-2009 28 542 446 138 1982 1982 0
BAKKEN 1-2009 31 644 679 163 1866 1866 0
BAKKEN 12-2008 31 619 892 133 2427 2427 0
BAKKEN 11-2008 29 586 238 182 1169 1169 0
BAKKEN 10-2008 31 644 454 177 997 997 0
BAKKEN 9-2008 30 616 622 143 910 910 0
BAKKEN 8-2008 31 642 656 165 998 998 0
BAKKEN 7-2008 30 658 669 160 1018 1018 0
BAKKEN 6-2008 30 633 919 114 966 966 0
BAKKEN 5-2008 31 654 442 188 936 936 0
BAKKEN 4-2008 30 663 893 123 915 915 0
BAKKEN 3-2008 31 682 647 160 903 903 0
BAKKEN 2-2008 29 665 463 123 860 860 0
BAKKEN 1-2008 31 727 701 135 941 941 0
BAKKEN 12-2007 31 732 725 159 1380 1380 0
BAKKEN 11-2007 30 694 714 130 1412 1412 0
BAKKEN 10-2007 31 688 698 142 1792 1792 0
BAKKEN 9-2007 30 702 692 135 2128 2128 0
BAKKEN 8-2007 31 699 648 150 2468 2468 0
BAKKEN 7-2007 31 671 686 155 2502 2502 0
BAKKEN 6-2007 30 670 692 143 2401 2401 0
BAKKEN 5-2007 31 715 666 148 2521 2521 0
BAKKEN 4-2007 30 719 881 161 2274 2274 0
BAKKEN 3-2007 31 742 862 150 2460 2460 0
BAKKEN 2-2007 28 713 668 128 2465 2465 0
BAKKEN 1-2007 30 770 662 197 2520 2520 0
BAKKEN 12-2006 30 738 660 157 2232 2232 0
BAKKEN 11-2006 30 749 872 158 2285 2285 0
BAKKEN 10-2006 31 734 444 192 2533 2533 0
BAKKEN 9-2006 30 737 885 153 2715 2715 0
BAKKEN 8-2006 31 758 877 170 2906 2906 0
BAKKEN 7-2006 31 788 661 162 3067 3067 0
BAKKEN 6-2006 30 800 879 163 2580 2580 0
BAKKEN 5-2006 27 813 801 173 1784 1784 0
BAKKEN 4-2006 30 793 791 159 1641 1641 0
BAKKEN 3-2006 30 871 832 204 1723 1723 0
BAKKEN 2-2006 28 830 644 171 2839 2839 0
BAKKEN 1-2006 27 776 877 178 2482 2482 0
BAKKEN 12-2005 31 897 1098 228 2833 2833 0
BAKKEN 11-2005 27 881 661 179 2208 2208 0
BAKKEN 10-2005 30 910 870 392 2499 2499 0
BAKKEN 9-2005 25 829 858 178 2665 2665 0
BAKKEN 8-2005 31 987 1040 237 4305 4305 0
BAKKEN 7-2005 31 1055 1030 268 4699 4699 0
BAKKEN 6-2005 30 1278 1273 314 3542 3542 0
BAKKEN 5-2005 20 727 698 158 2489 2489 0
BAKKEN 4-2005 28 1039 1220 365 1438 1438 0
BAKKEN 3-2005 31 1269 1071 316 187 187 0
BAKKEN 2-2005 23 1051 1073 238 2042 2042 0
BAKKEN 1-2005 27 1125 1080 262 309 309 0
BAKKEN 12-2004 31 1222 1325 294 2053 2053 0
BAKKEN 11-2004 30 1235 1343 285 1273 1273 0
BAKKEN 10-2004 30 1350 1525 314 1573 1573 0
BAKKEN 9-2004 30 1451 1310 390 1837 1837 0
BAKKEN 8-2004 31 1584 1747 425 1837 1837 0
BAKKEN 7-2004 31 1922 1695 520 2489 241 2248
BAKKEN 6-2004 30 1876 1876 600 2735 0 2735
BAKKEN 5-2004 31 2358 2252 875 774 0 774
BAKKEN 4-2004 27 3142 3621 1465 1800 0 1800
BAKKEN 3-2004 7 2324 1675 240 666 0 666





This Is How The Government Wastes Your Money -- Recent MDU Mandated Filing

For investors only. I hope you all clicked on MDU's most recent Form 8-K filing so you didn't miss any important investing information. 
This report is being filed in accordance with section 1503 of the "Dodd-Frank Wall Street Reform and Consumer Protection Act." On April 26, 2011, Hawaiian Cement, an indirect subsidiary of MDU Resources Group, Inc., received an imminent danger order issued by the Mine Safety and Health Administration under section 107(a) of the Federal Mine Safety and Health Act of 1977 at the Waikapu Quarry in Wailuku, Hawaii. The order was issued when a customer was observed standing on top of a loaded truck but was not wearing fall protection. The customer proceeded to climb off of the truck and the order was terminated. 
I can't make this stuff up.

How much time was wasted reporting this to the government that a man in a gravel truck did not have his hard hat on? This kind of garbage now buries important filings.

By the way, this is a common ploy in any bureaucracy, especially the military: Inundate one's superiors with stuff like this to hide the one meaningful, but embarrassing, report.

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Music video: a cover of "Little Red Riding Hood." There's something captivating about this video. With over 500,000 views, there are others who agree with me. (YouTube no longer allows embedding of their videos. Pity.) She reminds me of Mazzy Star -- Fade Into You.

Rigzone: Harold Hamm (CLR) and the Bakken

A big thank you to "Mike" for alerting me to this story on Harold Hamm, founder and CEO of Continental Resources.

I have seen so many stories on Harold Hamm, I put off reading this article initially but finally got around to it.

It may be the best article yet on Harold Hamm. It includes a wealth of information on the Bakken as well as how Harold Hamm struck it very, very rich in the Bakken.

CLR's Net Bakken Acreage Decreases Slightly -- Bakken, North Dakota, USA

For the record, I'm updating total Bakken acreage held by Continental Resources at the FAQ tab.

According to CLR's 2010 annual report, the company controls 855,936 net acres in the Bakken (ND and MT).

This is down slightly from previously reported 864,559 net acres.

In previous reports, CLR also makes reference to about 8,000 BLM acres. "BLM" is not mentioned in the 2010 annual report.

CLR acquired 8,266 BLM acres in ND/MT in the December 9, 2010, auction.

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Update: This is a note I was sent verbatim regarding the BLM purchase and why CLR is not reporting it (having said that, I am curious why CLR did not put this in their annual report -- at least I didn't see it in the annual report):
If you look at BLM lease operations for Nov/Dec (2010) they got held up under green house gas emissions. So it is my understanding that even though you won /bought the land lease, until the paper work is done about the green house gas emissions, a lease title is not issued to the lessee.

So this is why clr is not counting the 8,000 BLM acres.