Monday, September 19, 2011

Hitting the Wires Now -- EPA -- Shell - Arctic -- Hmmm, Hmmm, Hmmm

On Monday, April 25, 2011, I posted a story regarding the EPA.

I updated the story on Thursday, July 7, 2011.

Now, out of the blue, just hitting the wires in the last hour or so (9:30 p.m. CDT, Monday, September 19, 2011), it is being reported that the EPA will grant Shell an air-quality permit so it can drill in the Arctic.
The U.S. Environmental Protection Agency said Monday it has issued final air-quality permits to Royal Dutch Shell PLC to drill for oil and natural gas off the coast of Alaska, removing a longtime obstacle to the company's Arctic offshore drilling plans.
The permits will allow Shell to operate the Discoverer drill ship and a support fleet of icebreakers, oil-spill response vessels and supply ships for up to 120 days each year in the Chukchi Sea and Beaufort Sea Outer Continental Shelf starting in 2012, the EPA said.

The EPA permits have been a major hurdle to the company's Alaska offshore drilling plans, on which the company has invested more than $3.5 billion. Legal challenges and other regulatory hurdles also have delayed the company's plans.

In 2010, the EPA issued similar permits to Shell, but Alaska native villagers and environmental groups filed appeals opposing those permits with the EPA's independent Environmental Appeals Board, saying pollution from the drillships and support vessels would harm residents and wildlife.

In December, the appeals board invalidated the permits and sent them back to the EPA to be revised.

The new permits require Shell to cut emissions of soot and nitrogen dioxide from its fleet by more than 50% compared to the levels allowed in the 2010 permits, the EPA said. Shell will use new emissions controls to meet new limits on nitrogen dioxide that went into effect this year, the agency said.

Ten (10) New Permits -- Bakken, North Dakota, USA

Daily activity report, September 19, 2011 --

Operators: Enerplus (4), Petro-Hunt (2), BR (2), Cornerstone, GMX Resources

Fields: Little Knife, Spotted Horn, Tree Top, and Elidah

Petro-Hunt has permits for a 2-well pad in Little Knife; it looks like ERF has permits for two 2-wells pad in same section in Spotted Horn oil field.

Some nice wells released from "tight hole" status:
  • 18893, 1,142, XTO, Allen 21X-17, Williams County
  • 19615, 1,752, Oasis, Cowden 5404 13-35H, Williams County
  • 20097, 1,667, Denbury Onshore, Lundin 11-15SEH, McKenzie County
  • 20118, 934, XTO, Dedrick 24X-32, McKenzie
Other than that, not much, but these are some good wells.

Video of Construction Activity in the Bakken Boom -- Bakken, North Dakota, USA

The following videos were taken on Sunday (thus minimal construction activity), September 18, 2011.

This is one of the moderate-size subdivisions being developed.

It is on the northwest side of Williston.

The following video, I am told, is of a 24-lot parcel that an oil company bought to build homes on for their employees.

The following is the Granite Peak development northwest of Williston. It will be completed in three phases, if I remember correctly. It will be mixed residential with a school and a shopping center. The subdivision covers 289 acres (one-half section; there is an established residence in the southwest corner of the parcel that accounts for the missing 30 acres of the half section. I believe there may be as many as 2,200 units (single family, townhouse, apartment complexes) in this area when it is completed. Prior to the boom, there were probably about 3,000 units in Williston based on a population of 12,000 and four family members. It should be noted that this video was shot on Sunday, September 18, 2011, and they were working on the project. Activity in the Bakken is 24/7 although construction sites do slow down on Sunday.

Although this is only a single industrial site, I took video of it to better capture the size of these projects. Before the boom, a typical trucking company would have needed a maintenance building for one or two trucks, and a parking for a handful of large trucks and a few pickup trucks. Hexom Earth Construction has grown significantly since the boom began as evident by the size of their new building and the large complex currently being built.

The video below is the BHI "SuperSite" complex west of Williston: 100,000 square feet industrial space; 50,000 square feet office space. This, I believe, is the largest single building in Williston.

Jobs Bill Will Have to Wait -- LA Times

Link here (this is what they are reading in Los Angeles this a.m. -- from the "liberal" Los Angeles Times).
Obama's urgent jobs plan: Right now, 'right now' means sometime next month maybe.

Everybody remembers the urgency of President Obama's attitude toward the awful jobs situation.

Back in early August, Obama said the jobs situation was so urgent that he was going to give another speech about it -- in a month or so, in September after his vacation on Martha's Vineyard.

And then in September the president announced he would give his major jobs speech to a joint session of Congress on Sept. 7. But he neglected to check with congressional leaders first. And they suggested the 8th. So, since it was their House, the 8th it was.

"Tonight," the president said in the first 34 of his 4,021 words to a national television audience that night, "we meet at an urgent time for our country. We continue to face an economic crisis that has left millions of our neighbors jobless, and a political crisis that has made things worse."

The speech got panned as another political campaign one with Obama announcing, in effect, that....

...since the first stimulus spending plan of $787 billion hadn't really worked, maybe another $447 billion stimulus spending plan would.

This is the kind of thinking that can make sense within Washington. But since "stimulus" has become a laugh line, he didn't use that word anymore.

And, hey, the debt ceiling had been raised to $16 trillion. (Speaking of which the president speaks on the debt this morning in another speech because he's a Real Good Talker.) So why not spend a half-trillion more to look like he's doing something about the terrible jobs situation with 14+ million unemployed?
And the article continues. Go to the link for the rest of the story.

Oh, by the way, three more dollars in taxes for every additional dollar in new spending cuts. No wonder the market continues to plunge (another 200 points today). And then folks wonder why the Tea Party is doing so well in some areas of the country.

And then scroll down for the Bakken postings.

Update on Oil Demand in Persian Gulf -- Will Affect Bakken Future

Link here (these links break over time; require paid subscription eventually).
The Persian Gulf states will continue to dominate oil supply, backed by huge reserves. Gas is another important export product for the region, mainly in the form of liquefied natural gas (LNG).
OPEC policy and a relatively high level of quota adherence meant a meaningful downturn in 2009 regional supply, but there was noticeable growth in 2010 thanks to quota-busting activities of certain members. Following the June 2011 OPEC summit, which produced an unusually pronounced fissure between price 'hawks' and 'doves,' OPEC crude output exceeded the cartel's total quota (24.85mn b/d) by about 2mn b/d. The lion's share of this excess was produced by Saudi Arabia.
Iraq remains the region's 'wild card', with a medium-term production potential of around 6mn b/d by 2015. The country will likely have to downgrade its ambitious 12mn b/d long-term production goal to around 8-9mn b/d owing to infrastructure bottlenecks and politico-security risks. In the short term, however, Iraqi oil output growth is likely to be stellar.

For the region as a whole, we expect to see output capacity to reach 29.93mn b/d by 2015, representing a gain of 23% on 2010. With regional consumption set to reach 8.73mn b/d in 2015, the growing export capability is clearly vast. The Middle East region will have an export capacity of 22.42mn b/d in 2015, up from 17.68mn b/d in 2010.

Mike Filloon: Focusing On Two Bakken Counties -- 11 Wells Per Spacing Unit -- Bakken, North Dakota, USA

What a great way to start a new week in the Bakken! I have seen as many as seven, maybe eight wells in a Bakken 1280-acre spacing unit, but now a very respected voice is suggesting as many as 11. That is not a typo. Eleven, as in two short of a baker's dozen.

Two Mike Filloon links: one focusing on Mountrail County, and one focusing on McKenzie County.

The timing is very interesting. Some suggest that McKenzie County may overtake Mountrail County with regard to activity in the coming year. We will see.

This is his opening paragraph for McKenzie:
In my most recent article on Mountrail County, I highlighted what may be the best oil producing county in the country. Anyone that follows the Parshall, Sanish and Ross areas knows that initial production numbers are very high. Current density drilling methods could be a game changer as it could produce 11 wells per 1280 acre unit. Company estimates have Mountrail County 1280 acre units producing six to seven wells, providing a four to five well increase over current methods. If this is the case, and the average EUR per well is 800 MBoe (I believe this number is conservative), estimated total recovery would increase by 3.2 to 4 million barrels of oil equivalent. This number does not include possible re-fracs, or secondary recovery methods. It is very possible these technologies will also work in other areas decreasing costs and increasing the number of wells/1280 acre unit.

Yup, a great way to start the week.

Actually, I had a even a better start, but more on that later.