Wednesday, October 31, 2012

Pipelines, The Marcellus Effect; PSX Reports Nice Earnings

Earnings due out today: CHK, EPD, XOM, MPC, WPX. See sidebar at right for link. WPX: big loss due to derivatives; huge production gain in the Bakken; will hold leases by production;


RBN Energy: continuation of the pipeline series, the Marcellus effect -- WMB projects

******************
Link here to Bloomberg.
Phillips 66 (PSX), which became the largest U.S. independent refiner after its spinoff from ConocoPhillips (COP) earlier this year, said third-quarter profit rose 52 percent as the margin between oil costs and fuel prices widened.
Net income rose to $1.6 billion, or $2.51 a share, from $1.05 billion, or $1.65, a year earlier, Houston-based Phillips 66 said today in a statement. Profit excluding asset writedowns, early debt payoffs and other one-time items was $2.97 a share, 61 cents more than the average of 15 analysts’ estimates compiled by Bloomberg. Adjusted profit in the company’s chemicals business rose 42 percent to $275 million.
Shatters estimates: SeekingAlpha.com.

Earlier, COP also blew away estimates.

I do believe COP/PSX is one of Warren's larger holdings.

Fourteen (14) New Permits To Finish The Month of October

Bakken Operations

Active rigs: 186 (steady)

Fourteen (14) new permits -- on track for 2,589 new permits this calendar year (2012)
  • Operators: CLR (7), MRO (3), Hunt (2), Petro-Hunt (2)
  • Fields: McGregory Buttes (Dunn), Wildrose (Divide), Sather Lake (McKenzie), Little Tank (McKenzie), Dolphin (Divide(, Clear Creek (McKenzie), Brooklyn (Williams), Beaver Lodge (Williams)
  • Comments: Another day with no Newfield or OXY USA permit; Brooklyn oil field with two more permits;
One permit was canceled:
  • 22268, PNC, WPX Energy, Howling Wolf 28-33HC, Dunn County

Random Look At Fourteen (14) Wells In One Section: Moccasin Creek

In section 36-148-93, there are fourteen (14) wells. The two "original" wells were on single wells pads. The next twelve wells were on four 3-well pads. 23309 - 23314 are to the north; 23303 - 23308 parallel the ones to the north; they run west to east (or east to west). The horizontals will pretty much be straight north/south.
  • 21218, running north, 463, WPX, Good Bird 36-25HC, Moccasin Creek, t7/12; cum 3K 8/12; 7 stages; 800K lbs sand frac;
  • 21219, running south, 401, WPX, Black Hawk 1-12H, Moccasin Creek, t6/12; cum 81K 8/12; 30 stages; 3.6 million lbs sand frac;
  • 23314, conf, WPX, Good Bird 36-25HA, Moccasin Creek,
  • 23313, conf, WPX, Good Bird 36-25HW, Moccasin Creek,
  • 23312, conf, WPX, Good Bird 36-25HB, Moccasin Creek,
  • 23311, conf, WPX, Good Bird 36-25HX, Moccasin Creek,
  • 23310, conf, WPX, Good Bird 36-25HZ, Moccasin Creek,
  • 23309, conf, WPX, Good Bird 36-25HD, Moccasin Creek,
  • 23303, conf, WPX, Blackhawk 1-12HA, Moccasin Creek,
  • 23304, conf, WPX, Blackhawk 1-12HW, Moccasin Creek,
  • 23305, conf, WPX, Blackhawk 1-12HB, Moccasin Creek,
  • 23306, conf, WPX, Blackhawk 1-12HY, Moccasin Creek,
  • 23307, conf, WPX, Blackhawk 1-12HZ, Moccasin Creek,
  • 23308, conf, WPX, Blackhawk 1-12HD, Moccasin Creek,
Just to the east of these wells, one mile to the east, in section 31-148-92:
  • 22649, conf, WPX, Charles Blackhawk 31-30HA, Heart Butte,
  • 22650, conf, WPX, Charles Blackhawk 31-30HX, Heart Butte,
  • 22651, conf, WPX, Charles Blackhawk 31-30HB, Heart Butte,
  • 22652, conf, WPX, Charles Blackhawk 31-30HY, Heart Butte,
  • 22653, conf, WPX, Charles Blackhawk 31-30HC, Heart Butte,
  • 22654, conf, WPX, Charles Blackhawk 31-30HZ, Heart Butte,
  • 22655, conf, WPX, Charles Blackhawk 31-30HD, Heart Butte,
And in the same section 31-148-92, an additional four wells:
  • 21904, 1,542, QEP, MHA 4-06-07-H-147-92, t8/12; cum 21K 9/12;
  • 21905, 2,223, QEP, MHA 2-06-07-H-147-92, t8/12; cum 21K 9/12;
  • 21906, 2,142, QEP, MHA 4-32-33-H-148-92, t8/12; cum 20K 9/12;
  • 21908, 2,180, QEP, MHA 2-32-33-H-148-92, t8/12; cum 20K 9/12; 
And now another 4-well pad in this section, 31-148-92:
  • 24845, conf, QEP, MHA 3-06-07H-147-92, Heart Butte,
  • 24846, conf, QEP, MHA 1-06-07H-147-92, Heart Butte,
  • 24847, conf, QEP, MHA 7-06-07H-147-92, Heart Butte,
  • 24848, conf, QEP, MHA 5-06-07H-147-92, Heart Butte,
And a 2-well pad in this section, 31-148-92:
  • 24849, conf, QEP, MHA 8-06-07H-147-92, Heart Butte,
  • 24850, conf, QEP, MHA 6-06-07H-147-92, Heart Butte,

CNG - LNG Filling Station Locators

Updates

November 1, 2012: a reader (thank you) has provided an even better map/data base -- worldwide CNG locations and PRICES. Prices are 75 cents in Alberta, Canada, vs $2.00 in Austin, Texas.

Original Post
This is an interesting map: CNG - LNG filling station locators.

The legend at the left at the link allows one to click on/off current stations and stations that are planned.

It is interesting to see the Flying J corridor across I-80 from California to Chicago. Similarly, I-10 from southern California to Dallas, Texas, and then all the way to Jacksonville, Florida.

The Denver area is also particularly interesting.

Back To Normal? Wednesday Links

First, this interesting mea culpa from RBN Energy: natural gas rigs and productivity. As noted by MDW back on October 20, 2012, the new metric is permitting; the old metric is number of rigs. [Note: see first comment -- yes, the new metric is permitting. Original post was in error. Thank you to an alert reader for picking up on this! Smile.]

Mike Filloon on the Bakken, an update, Part I: this is a very, very long article. Not much particularly new for regular readers. Perhaps this is of interest:
EOG Resources has begun waterfloods with very good results in Parshall Field. Depending on the results, it could change the scope of total recoveries.
Feel good story about tremendous Dickinson-area growth in the Dickinson Press

GM's profits fall 12% due to challenges in Europe.

World series of poker: Merson wins.  King high. Beat a queen.

Earnings on tap for today, most after market close: EPD, EEP, SM, WMB.

Tuesday, October 30, 2012

Circulation at The Wall Street Journal Rose Sharply From a Year Earlier -- All Other Dailies Down (Sunday Editions Up)

Newspaper circulation slips further -- WSJ; 
Circulation rose sharply at The Wall Street Journal, which had average weekday circulation of 2.3 million as of Sept. 30, up 9.4% from a year earlier.
The Wall Street Journal maintained its position as the country's largest newspaper by average weekday circulation, with others in the top three spots also keeping their ranks.
The Journal moved past Gannett Co.'s flagship USA Today as the largest U.S. newspaper in 2009. USA Today had been the biggest paper in the U.S. for a decade.

Boomtown Banks: What To Do With All That Money!

Note the source of this article!

Link here to Stanford University.
Gary Peterson, along with his family, owns the Lakeside Bank in New Town. I first interviewed him about a year ago, and didn’t notice the hint of gray showing along his temples. He’s smiling as he tells me, “The amount of liquidity in the system is amazing. We’re growing at 20% a year in deposit growth, which for rural North Dakota is unheard of. Before this happened, I think a lot of bankers would have told you that one their concerns is how we going to sustain the deposit side of our balance sheet. As the elderly would leave or die, those deposits would go to their kids who are usually elsewhere. Totally different story these days, we’re wondering what to do with it, frankly.”
David Hansen is the President of American State Bank and Trust in Williston, the epicenter of today’s boom. He remembers what happened during the oil embargo of the 1970’s. Williston funded an infrastructure expansion with bonds. “Then the oil embargo was over, the price of oil plummeted, and all exploration pretty much stopped in a very short time frame. People exited the area very quickly. [Williston] was strapped with about $27 million of special bonds based on property tax, and they weren’t worth anything. They went to a sales tax to pay off those bonds, and it took about 25-30 years to pay them off. That’s still fresh on people’s minds.” Hansen adds that it wasn’t only the city that was hurt; many banks had many bad loans on their hands as well.
********************
Note to the Granddaughters

Earlier today I bicycled down to the Boylston Apple store in Boston (which reminds me: there's a Microsoft store across the street inside the mall; I've never visited it; I saw it "going up" some months ago). I wanted to see the new iPad mini, but it won't be available (in stores) until Friday. Apple stores generally open at 10:00 a.m. (I think) but there are rumors that the stores will open at 8:00 a.m. on Friday for the iPad mini launch.

There has been some complaints that the iPad mini is priced at $329 instead of $299. Of course, if it had been priced at $299, folks would have complained that it was not $249. But back to the $329 vs $299 price point. Somehow, when most Apple aficionados own several Apple products (iPhone, iPod, desktop, and/or laptop) it's hard to take those complaints ($329 vs $299) seriously. Seriously? $30 is a deal breaker?

I had forgotten (actually never paid any attention) how phenomenal the iPod Nano is, the one with the FM radio. 4,000 songs. One ounce.

But this was the takeaway: there is something for everyone for holiday gifts at the Apple store, from less than $20 to more than .... well, whatever you want to pay.

Ten Defining Moments

Photo-Ops: bowing to world leaders (compare to Putin)
Foreign policy: deciding to ignore the Libyan debacle, and then lying about it later
Energy: killing the Keystone XL; Solyndra and 36 other failing/bankrupt DOE-backied companies
Social programs: ObamaCare
Tourism: don't visit Las Vegas
Geography: 57 states
Bailouts: GM in/out of bankruptcy in 39 days; unions own GM
Natural disasters: short visit to New Jersey; then back to campaigning; avoids questions
Language of desperation: "Opponent is bullshitting"
Michelle: school lunches

Fourteen (14) New Permits

Bakken Operations

Active rigs: 185 (steady)

Fourteen (14) new permits -- on track for 2,580 permits this calendar year --
  • Operators: Petro-Hunt (5), Marathon (4), Zenergy (2), Liberty Resources, Whiting, Baytex
  • Fields: Dollar Joe (Williams), Foreman Butte (McKenzie), Glass Bluff (McKenzie), Bailey (Dunn), Eagle Nest (Dunn), Wolf Bay (Dunn), Burg (divide), Clear Creek (McKenzie)
  • Comments: Another day with neither a OXY USA permit or a Newfield permit.
Wells coming off confidential list were reported earlier; see sidebar at the right.

Producing well completed:
  • 22270, 484, WPX/Dakota-3, Fettig 6-7HC, Eagle Next, t9/12; cum ---
Fidelity canceled a permit:
  • 23458, PNC, Fidelity, Westin TTT 34-27H, Mountrail, 
*************************
A Note to the Granddaughters

Absolutely correct
“I believe the novella is the perfect form of prose fiction,” McEwan writes. “It is the beautiful daughter of a rambling, bloated ill-shaven giant (but a giant who’s a genius on his best days). And this child is the means by which many first know our greatest writers. Readers come to Thomas Mann by way of ‘Death in Venice,’ Henry James by ‘The Turn of the Screw,’ Kafka by ‘Metamorphosis,’ Joseph Conrad by ‘Heart of Darkness,’ Albert Camus by ‘L’Etranger.’ I could go on: Voltaire, Tolstoy, Joyce, Solzhenitsyn. And Orwell, Steinbeck, Pynchon. And Melville, Lawrence, Munro. The tradition is long and glorious.”
“The great novella,” McEwan observes, “is Joyce’s ‘The Dead.’” 
This is exactly how I started with the great writers: "The Turn of the Screw," "Metamorphosis," "Heart of Darkness."
Of them all, Henry James' "The Beast in the Jungle" may be the most haunting. I need to re-read "The Dead."

Wow! Dow! Wow! Dow Chemical Loses Big On Batteries -- $1 Billion

Link here to Reuters.
Dow Chemical Co will take a fourth-quarter charge of up to $1.1 billion related to last week's announcement it will close 20 plants, write down the value of its lithium ion battery business and lay off thousands of workers.
Dow, the largest U.S. chemical maker, said the restructuring program - its second of 2012 - was necessary because of dropping demand for its plastics and other products.
Dow will record a charge of $900 million to $1.1 billion for the layoffs, plant closures, as well as a write-down of Dow-Kokam LLC, Dow's lithium ion battery joint venture with TK Advanced Battery LLC. The disclosure came as part of a filing with the U.S. Securities and Exchange Commission on Tuesday.
Before the filing, analysts had expected Dow to post a fourth-quarter net profit of about $429.3 million, according to Thomson Reuters I/B/E/S.
Wow. 

North Dakota Company Building Canola Plant in Oklahoma

Link here to Dickinson television.
A North Dakota-based company plans to build a canola processing plant in Oklahoma.

Fargo-based Northstar Agri Industries says construction of the plant near Enid, OK, is expected to be done before the 2015 canola harvest. The plant would be capable of producing 290,000 tons of food-grade canola oil and 450,000 tons of canola meal animal feed annually.
Enid, OK, is where CLR used to be based. Coincidental?

Update on Kows to Kazakhstan

Updates

December 4, 2012: Link to The Bismarck Tribune.
Fifteen cattlemen from Kazakhstan have taken ranching tips back to their country after spending time with some veteran North Dakota cowboys.

More than 5,000 Hereford and Angus cattle bred to withstand North Dakota winters have been sent to Kazakhstan recently to rebuild the country's beef industry, which was almost depleted after the collapse of the Soviet Union in 1991.
Original Post

Link here to earlier story on kows to Kazakhstan.

Now, an update at Dickinson television:
A state trade official says North Dakota-bred cattle are successfully taking root in a former Soviet republic but many of Kazakhstan's cowboys are still greenhorns.
North Dakota Trade Office Executive Director Dean Gorder says about a dozen Kazakhstan cowboys are slated to work on North Dakota ranches next month for an intensive two-week crash-course in tending cattle.
About 5,000 hardy cattle bred to withstand North Dakota's harsh winters have been airfreighted to Kazakhstan over the past two years to help rebuild the country's cattle industry. About 3,000 more cows are slated to be shipped this fall.
How much you wanna bet about dozen Kazakhstan cowboys will be looking for ways to stay in North Dakota after the two-week course?

What a great state! What a great country! I find this whole story very fascinating.

These videos will keep the Kazakhstan kowboys koming back:

Do I Love You, Hillbilly Moon Explosion
And more hillbilly:

I'm Gonna Dry My Eyes, Hillbilly Moon Explosion
I love the bass.

But, a kowboy klassic:
Cattle Call, Eddy Arnold

Three Completed Wells in Montana's Williston Basin Bakken

Link to Fairfield Sun Times.
In Richland County, XTO Energy Inc. wrapped up the Panasuk 34X-12, with an SHL at SW SE 12-23N-58E (275 FSL/1350 FEL) and a BHL of 19,760 feet at  NW NE 1-23N-58E (716 FNL/1974 FEL). The Bakken well reported an initial production (IP) of 205 barrels of oil per day; 89 thousand cubic feet of gas per ay (mcfpd) and 982 barrels of water per day (bwpd).

In Roosevelt County, Oasis Petroleum North America LLC completed the Piercy Federal 2758 13-5H. The Bakken well has an SHL at NW NE 5-27N-58E (320 FNL/2310 FEL) and a BHL of 20,686 feet at NW NE 29-28N-58E (652 FNL/2311 FEL). The well had an IP of 1,792 bopd; 1,365 mcfpd and 3,956 bwpd.

In Sheridan County, TAQA North USA, Inc. finished the Kavon 17-16H. The Bakken Formation well has an SHL at SE SE 17-37N-56E (680 FSL/245 FEL) and a BHL of 11,912 feet at SW SW 17-37N-56E (673 FSL/660 FWL). The well had an IP of 24 bopd and 390 bwpd.
For newbies:
Roosevelt County is directly west of Williston; recent story on new fracking sand terminal in Bainville, is in Roosevelt County.

Richland County is southwest of Williston, home of Elm Creek, first major Williston Basin Bakken field.

Sheridan County is northwest of Williston, the northeasternmost county of Montana.

Faux Environmentalists Continue to Stifle Coal Exports; Slow Montana's Economy -- Nothing To Do With The Bakken

Link here to Fairfield Sun Times.
Although the benefits of an expansion at the Spring Creek mine are obvious, whether the project will be able to proceed is far from certain.  Global demand for coal is projected to increase significantly in coming years, but existing shipping ports on the West Coast are currently at capacity.  In order to ship more coal, grain, and other Montana commodities to overseas markets, new terminals need to be built.  Environmental groups have launched a new campaign against the ports to delay or prevent their construction.
Summary:
An economic analysis of a proposed expansion of the Spring Creek Mine near Decker shows significant, positive impacts for Montana, including over 1,400 new jobs, a nearly $60 million increase in income for Montanans, and over $70 million in new tax revenue for state and local governments.
Data points (numbers rounded; exact numbers at link):
  • 1,500 jobs, in many sectors, all regions of Montana
  • $60 million in income on an annual basis; $50 million after-tax for household spending
  • $70 million/year in state government revenue
  • the current worker at the Spring Creek Mine: $100,000 in wage and benefits, far above median wage in Montana

Another Inconvenient Truth -- $300,000/Job -- Government Stimulus Job Creation -- Nothing To Do With the Bakken

October 30, 2012: $300,000/A123 job with government stimulus (best figure; it could be worse; depends "how" one counts) --
Battery maker A123 Systems vowed thousands of new jobs when it received a nearly quarter-billion-dollar stimulus grant in late 2009, but federal job-tracking figures show only a few hundred positions were created before the company joined a growing list of federally backed energy businesses that ended in bankruptcy.
The latest quarterly report on file with a federal stimulus tracking database shows just seven positions created through the grant from April to June this year. Previous quarters’ job reports contained anywhere from a handful of positions created to more than 100 new jobs.
But even when the quarterly reports are combined, a total of 408 new positions were reported under the stimulus program since 2009, amounting to more than $300,000 spent for each new job reported. [Double counting, triple counting?]
Click here for a list of DOE-backed green energy companies that went bankrupt.

I saw the linked article on A123 earlier but had not planned to post it, but:
a) a reader also saw it and sent it to me for posting; and,
b) someone sent in a comment asking if I was going have my daily global warming rant.
I wasn't going to post a global warming story (I didn't comment on the record snowfall in Appalachia this week) but I didn't want to let my readers down ... so it's posted.

Feel Good Story: The Bakken As a Laboratory

Sent to me by CRC; see first comment (that comment was sent to a different post; I moved it to this post). Thank you.

Link here to Bismarck television.
North Dakota was once a place early pioneers came to explore. Today there`s more exploration in the oil fields where companies are pioneering new technologies to enhance oil recovery. Hydraulic fracturing and horizontal drilling have opened the flood gates to extract oil from the Bakken. Yet companies are still only recovering six to eight percent of the oil in the ground.

So now the goal is to become more efficient and test new technologies that would allow the other 92 percent of the oil in the Bakken to be used (sic).

Newer recovery methods are moving past hydraulic fracturing and horizontal drilling to other technologies that would provide even greater efficiency.

"As we continue with our technology and we get better and better at what we`re doing on all three fronts, the geology, the horizontal drilling and the fracking technology, and then bring in that secondary and tertiary recovery, the future is just tremendous for North Dakota," said Kathleen Neset with Neset Consulting Service.
Go to the link for the full story.

Random Note on the Storm, Whaling, Etc -- Nothing To Do With The Bakken

Yesterday I rode my bike to Starbucks during the storm. I arrived at Starbucks before the storm really got started (here) and then departed just as it was beginning to pick up. The wind pushed me pretty fast on the way home.

Today, the weather is quite nice. We are far enough inland from Boston harbor that not a lot of problems. It is overcast, but no rain, no wind. Nice temperature for riding a bike.

One tree fell in the Starbucks parking lot, taking out a car from New Jersey. The driver had come up here to visit friends and family, and to escape the storm in New Jersey.

What's that they say about Mother Nature?

*****************************

On another note, I am reading Moby Dick on the iPad. I don't recall ever reading Moby Dick, unless I read parts of it in high school. I never thought I would enjoy it. Like so much literature, one has to be ready to enjoy it, to enjoy it. I've often said that "making" students read entire novels in high school does not work. The operative word is "making."

It's been quite a journey to Moby Dick, but I finally arrived. The writing is such I never could have enjoyed it in high school, but after James Joyce and Virginia Woolf it's "easy" to read. But still, I would not be enjoying it without:
  • the whaling watches with granddaughters out of Boston harbor
  • studying whales with the older granddaughter
  • reading Dick Russell's Eye of the Whale (perhaps this is really what got me started), about Charles Melville Scammon, whaler and conservationist; two other "whale" books
  • visiting New Bedford, home of whaling in the 19th century; on a whim; serendipity the visit;
  • visiting Seamen's Bethel in New Bedford, frequented by Herman Melville, at least on one occasion (Seamen's Bethel was probably the highlight of my day in New Bedford)
  • downloading a free copy of Moby Dick on the iPad; can take notes; google phrases, words

Nothing About The Bakken -- If You Came Here for The Bakken, Scroll Past this Post -- Where Did All That Green Energy Money Go? -- Absolutely Nothing About The Bakken

Al Gore: net worth estimated at $100 million, up from less than $2 million when he left government service on a salary of $181,400.
"Fourteen green-tech firms in which Gore invested received or directly benefited from more than $2.5 billion in loans, grants and tax breaks, part of President Obama's historic push to seed a U.S. renewable-energy industry with public money." 
That's nice work if you can get it—at least if you're on the investment-management end of the deal. But what if you're on the worker-bee end?
The Post story mentions one of the beneficiaries of Mr. Gore's investment acumen, Milwaukee-based Johnson Controls, which won a $299 million award from the federal government in 2009 to make electric-car batteries. Here's how that worked out:
"The company has dramatically scaled back, after executives concluded demand for electric cars was far lower than the administration forecast. The factory outfitted with stimulus funds is nearly idle, and plans to build a second plant have been postponed."
And the article gets more interesting, at the link.

Global warming. Follow the money.

***********************
Other op-ed pieces from the WSJ worth reading. Not recommended for those on heart medication or with "heart conditions."

The Fog of Obama's Non-War

Secretary of Say What?

The Ethanol Election Delay
Why the US burns 40% of its corn, despite a global food shortage.
School reform on the ballot

Jerry Brown vs the 99%

Payroll taxes are "Regressive"? Time to rethink that idea

"Concierge" medicine, ObamaCare and the end of empathy

Putting Things into Perspective

From the WSJ, byline, Minneapolis, putting a face on welfare spat.
Latisha Cunningham, an unemployed 30-year-old, carries an activity log in her pink backpack so she can document every hour she spends in temporary work, looking for jobs or at community college.
If she is missing signatures from a teacher or doesn't have the right mix of activities, she could lose the $437 a month she receives in cash assistance. If the state doesn't have the right documentation for her, it could lose federal funding for its welfare program. Counselors say that assembling the paperwork is so time-consuming that helping her land permanent employment takes a back seat to perfecting her time sheet.
Minnesota's frustrations with federal-welfare regulations are at the center of a campaign-trail fight over how much leeway Washington should give states to run the program. It and a handful of other states contend too much emphasis is being placed on documentation and not enough on whether recipients actually find jobs. 
Bureaucrats.

From Teegue, the Pugh clause
" The answer was generally yes but we need stratigraphic relief to optimally continue our explorations" translates into 'we want the freedom to go deeper without having to buy new vertical leases in areas where we have shallower wells already drilled and holding higher formations by production." So, end result is IF the NDIC grants them that "stratigraphic relief"  then these operators will most certainly be exploring into areas not on the radar at the time of permitting... and since they will not have to secure another formational permit, neither will they be required (or compelled, or even morally prompted) to put the time and resources into investigating who does and who does not have a workable and viable Pugh Clause --
Greed.

Most Fun I Will Have All Day Posting -- Yes, It's About The Bakken -- Life Imitating Art

I posted this photo-journalism story about one year ago, October 18, 2011: photos of new housing activity in the heart of the Bakken.

It was posted at the height of some pricing insanity in the Bakken, and the story was done tongue-in-cheek. I certainly hope no one on the East Coast thought it was "real."

So, check out the story at the link above, and then go to a Dickinson Press story about life imitating art.

Monday, October 29, 2012

Six (6) New Permits -- OXY With A Nice Well; Whiting With a Nice Pronghorn Well; BEXP With Two More Nice Wells, Including One Just North of Williston

On Tap for Tuesday

Mike Filloon: a Bakken update; the Red Queen is just a fairy tale.  The article is pretty much all about northeast McKenzie County, which I consider the very heart of the Bakken. I predicted last year that 2012 would be the year operators moved from Mountrail to McKenzie. It turns out northeast McKenzie County will be as big as (or bigger than) the Sanish/Parshall in Mountrail. From Mike's article:

  • 20589 is one of the best wells here, if not the best well in the Basin. It is notable that Whiting produced this result while using lower amounts of water and proppant. 
  • 20589, 4,815, Whiting, Tarpon Federal 21-4H, Twin Valley, t10/11; cum 251K 8/12;
RBN Energy: will the oil boom continue? Production, yes; prices, probably not.

Reporting earnings tomorrow: OKE, OKS, QEP, STR, VLO, WMB (all after market close?)

Coming off the confidential list on Tuesday:
  • 21112, 1,358, MRO, Aisenbrey 21-25H, Big Bend, t7/12; cum 29K 8/12;
  • 21686, 286, OXY USA, Kubik Trust 2-18-19H-143-95, Murphy Creek, t5/12; cum 41K 8/12;
  • 21874, 540, Zavanna, Tony 1-3H, Stony Creek, t8/12; cum 16K 8/12;
  • 22176, 1,261, Whiting, Marsh 34-9PH, Dutch Henry Butte, t5/12; cum 45K 8/12;
  • 22216, drl, WPX, George Evans 11-2HD, Van Hook,
Putting things into perspective: From the WSJ, putting a face on welfare spat.  From Teegue, the Pugh clause. 
Bakken Operations

Rigs: 182 (significant decrease; new post-high low)

Wells reporting IPs today (reported earlier; see sidebar at the right)

Six (6) new permits -- on track for 2,572 permits for calendar year 2012 (oil and gas wells; does not include salt water disposal wells)
  • Operators: Petro-Hunt (3), Zenergy (2), Enduro
    Fields: Eagle Nest (Dunn), Eightmile (Williams), Mouse River Park (Renville)
  • Comments: Another day with no Newfield or OXY USA permits; Enduro again, targeting the Madison, probably
Two producing wells completed:
  • 21955, 2,972, BEXP, Cvancara 20-16 3H, Alger, t9/12; cum --
  • 22081, 3,383, BEXP, Heen 26-35 2H, Todd, t9/12; cum --; just north of Williston;
Triangle US Petroleum assumes operator status for several older wells in McKenzie County.

Energy Jobs - Nothing To Do With the Bakken

Wow, talk about putting a lot of pieces together. Link to PR Newswire here.

Location: Lake Charles, Louisiana
Construction jobs: 1,500
Permanent jobs: 165
The scheme

Lake Charles Clean Energy, LLC, a subsidiary of Leucaida Energy, LLC, contracts with:
  • BP 
  • Air Products and Chemicals
  • Denbury Onshore
Project: cleanly manufacture industrial products from petroleum coke, the first of its kind in the US

Data points:
  • LCCE: to become one of the world's lowest-cost producers of methanol, hydrogen, argon
  • will capture, compress 90% of CO2
  • BP will purchase the methanol
  • Air Products will purchase the hydrogen and argon
  • Denbury will purchase the CO2 for EOR
  • $2.5 billion
  • up to 1,500 construction jobs during the 3 - 4 year construction period, beginning in 20131
  • multiple federal and state tax incentives, including a $128 million federal investment tax credit

Energy Impact on North Dakota:

Link to Minot Daily News. (A "thank you" to a reader for alerting me to the story.)

This is an interesting article, providing a bit of insight into how one can make sense of the Bakken.
Biberdorf said he classifies Bakken boom issues into three categories: road, water or land use issues. Under each of those issues, he said, there's definitely other issues, for example, under roads there's issues including dust and aggressive driving.
At first glance this is a "feel-good" / human interest story, but there's a fair amount of good information and some interesting trivia.

For example: record number of wells on one pad? 18.

This is an interesting observation. Most folks just want the truck reliever routes to get the trucks off the other roads, but truck routes bring additional dividends:
He said the truck routes for bypasses are important for a number of reasons but what he's observed is they allow cities to move forward.

With all the truck traffic in Williston, he said it was hard for development to occur because they were always looking at the traffic. As the bypasses open up, he said the development of the city has become a little more clear where it wants to go.
A very interesting article at the link.

Selected Data Points: KOG's Corporate Presentation

Production guidance: exit rate, 2012 (E) -- 27,000 boed

CAPEX
  • 2009: $27 million
  • 2010: $82 million
  • 2011: $261 million
  • 2012: $650 million (E)
Rigs
  • Operating rigs: 8
  • Non-operating rigs: 1 - 2
Payout (months) - $10.5 million wells)
  • Bakken, long lateral, 650: at $75, 38 months
  • Bakken, long lateral, 750: at $75, 30 months
  • Bakken, long lateral, 850: at $75, 24 months
Net acreage unchanged: 155,000 net acres
Proved reserves: 70 million boe; 86% liquids; all hbp by end of 2013;
Full-time 24-hour dedicated frack crew; additional part-time crew as needed;
Six operating areas in the Bakken; all in North Dakota except unnamed area northeast MT; net well locations
  • Polar: sweet spot north of the river, 197; hbp by end of 2013;
  • Koala: sweet spot south of the river, 93, hbp by end of 2012;
  • Smokey: 88; hbp by end of 2012;
  • Dunn County: most net acres, 186, hbp by end of 2012;
  • Grizzly: Elm Tree extension into North Dakota, 148
  • Wildrose: fewest net acres; farthest north, 90
Total net well locations: 807 (includes 6 in Sheridan County, MT)
  • Generally based on four MB and three TF wells/spacing unit
  • 82 net locations drilled and completed through June 30, 2012
North Dakota takeaway:
  • Currently 975,000 b/d: 525/rail; 450/pipeline
  • 1,400,000 b/d by year-end 2013

Sunday, October 28, 2012

Wells Coming Off Confidential List Monday

RBN Energy: the series continues on master limited partnerships (MLPs); pipelines

Random comment on MLB: was it just me or did this seem to be one of the shortest, most uninteresting playoffs/World Series in quite some time (except for Detroit and SF fans)?

Active rigs: 186 (steady)

Wells coming off the confidential list tomorrow:
  • 21752, drl, ERF, Beluga 148-93-06B-05-3H, McGregory Buttes,
  • 22165, 709, Slawson, Athena 6-36TFH, Alger, t6/12; cum 19K 8/12;
  • 22558, drl, Triangle, State 154-102-25-36-1H, Rosebud,
  • 22657, 1,204, MRO, Judy Christensen 31-4H, Bailey, t8/12; cum 8K 8/12;

  • 19859, 1,102, Newfield, Chameleon State 153-97-16-21-1H, Banks, t7/12; cum 16K 8/12;
  • 21988, A, Whiting, Tiisto 44-7TFX, Sanish, t --; cum 13K 8/12;
  • 21989, 2,480, Whiting, Tiisto 44-7XH, Sanish, t5/12; cum 86K 8/12;
  • 21990, 688, Whiting, Tiisto 43-7TFX, Sanish, t4/12; cum 20K 8/12;
  • 22264, 276, Hess, EN-Patrick Joseph 157-94-2314H-1, Big Butte, t6/12; cum 19K 8/12;

  • 21751, 770, ERF, Humpback 148-93-06B-05-4H TF, McGregory Buttes, t8/12; cum 20K 8/12;
  • 22272, 471, CLR, Bismarck 2-9H, Brooklyn, t9/12; cum 10K 8/12;
  • 22284, 148, CLR, Olaf 1-7H, Wildrose, t7/12; cum 1K 8/12;
  • 22589, 490, Petro-Hunt, King 157-101-3B-10-1H, Otter, t7/12; cum 11K 8/12;

New permits: Through Sunday, October 28, 2012: on track for 2,574 new permits for 2012.

A Note to the Granddaughters
Monday Morning, 7:50 am, Update on Hurricane Sandy
Inland, about 5 miles west of Boston
I am at Starbucks. The weather has not gotten particularly bad yet. It is misting, and starting to rain lightly. Breezy, starting to get windy but no problem riding the bike. They say the gusts to 55 mph in this area will begin after 10:00 a.m. and last throughout the day.

Traffic was about 30% of normal. Starbucks with skeleton crew; very few patrons.

Another Neat Data Point: U-Haul Rates To/From the Oil Patch

Link here to CarpeDiem.

Several data points are provided at the link. This is just one:
From Chicago to Williston, ND: $1,879
From Williston, ND to Chicago: $876 
Ratio: 2.1

Carpe Diem With Another Nice Bakken / Eagle Ford Graph

Link here to CarpeDiem.

The chart [at the link] displays the daily crude oil output in America’s top four oil-producing states: Texas, North Dakota, Alaska and California over the last ten years (EIA data). Two states are pretty much out of the reach of the feds; two states are pretty much stymied by the federal government. This is not rocket science.

Here are some highlights:
1. After producing a relatively inconsequential share of the nation’s crude oil for many years (fewer than 100,000 barrels per day and only 1.5% of total domestic output), North Dakota’s oil production took off about five years ago when advanced drilling techniques including hydraulic fracturing started tapping into the vast resources of shale oil in the state’s Bakken region.  In just the last five years, the state’s oil output has increased seven-fold, and North Dakota is now producing more than 700,000 barrels of oil per day, which is close to 11% of total US output.
2. In December of last year, North Dakota was producing so much shale oil in the Bakken region that it surpassed California’s oil production to become America’s No. 3 oil-producing state, and then just three months later in March of this year the Peace Garden State surpassed Alaska to become the nation’s No. 2 oil-producing state.
Go to the link for the rest of the "feel-good" story.

As usual, the comments at the link continue to show that a lot of folks have no clue how this all happened.

Y'all remember all those folks who thought the Bakken was over-hyped? And I love this stat: North Dakota's 7,000 wells out-produce California's 60,000 wells.

Over Time, Cheap Energy in the US Will Widen The Delta in Growth: Europe vs US -- And We Might Being Seeing Some Evidence of It Now

Link here to Yahoo!News.
The latest earnings season had its fair share of short revenues, dimmed outlooks, and layoff announcements. But for a few companies and industry segments, there is a silver lining: energy costs are staying in line, thanks to the natural gas glut.

The natural gas advantage helps on two levels. Chemical companies, plastic makers, and fertilizer outfits use natural gas to make key ingredients for their products. Other companies, like metal workers and utilities, can use natural gas to produce energy for their operations or power customers.

"Our natural gas consumption has gone up 150 percent for this year versus last year so that's the kind of renaissance that's occurring in the energy industry that we haven't seen before," American Electric Power CEO Nick Akins said ...

US Coal Exports To Set New Record -- Breaks 1981 Record -- Nothing To Do With The Bakken

Trivia

Q: At the turn of the century (1911, e.g.), how much coal did an American Line passenger steamship (such as the the SS New York or the SS Philadelphia) burn per hour?
A: "To produce the superheated steam to drive these engines, the ships' boilers consumed about 13 tons of coal per hour. -- Eugene O'Neill and Dat Ole Devil Sea, Robert A. Richter, c. 2004, page 69.  Passage from New York to Southampton (England) generally took "a week." 24 x 7 x 13 = 2,184 tons of coal per trip. 

Updates

October 29, 2012: an alert reader caught the Bloomberg error. It should be 113 million tons.

Original Post
Link here to Bloomberg.
U.S. coal exports are on track to break their annual record of 113 billion (sic) tons, set in 1981, according to the U.S. Energy Information Administration.
Wow, this really caught me off-guard, with all the stories this past year, how badly domestic coal companies were doing.

This tells me that:
  • domestic consumption of coal has historically far outstripped what we sent overseas
  • despite environmental efforts to stop coal exports, a fair amount of coal is still being exported (just one of many links for this source)
  • the insatiable demand for energy continues (perhaps spurred by the Japanese nuclear debacle; the Chinese need for energy) 
Good, bad, or indifferent -- it just surprised me: that US coal exports will break the record set in 1981 -- over 30 years ago. 

On The Montana Side of the State Line, 28 Miles West of Williston, Epicenter of the Bakken, Fracking Sand Terminal, Bainville, MT

Twenty-eight miles west of the epicenter of the Bakken: Bainville, MT
+ largest straight piece of continuous track between Wisconsin and the Bakken
+ neither Roosevelt County nor Bainville have any zoning laws to control growth
+ the Bakken: insatiable appetite for fracking sand  
= One of the most incredible stories in the Bakken: at least $30 million being poured into a town with 208 people and an annual budget of $250,000.
A developer is putting a huge fracking sand off-loading terminal in Bainville, 28 miles west of Williston.
By early next year, each week a pair of 40-car trains, and eventually 100-car trains, will pull weekly off BNSF’s main track onto Procore’s mile-long sidetrack, offloading tons of fracking sand.
At peak production, the Bainville facility could handle 1 million tons of sand per year, enough to fill 600 truckloads a day. But the volume will probably be half that, Milino said.
Back of envelope calculations:
1 million tons x 2,000 pounds/ton = a large number
a typical frack is now up to 4 million pounds of sand
divide that large number by 4 million pounds = 500 wells
2,000 wells/year are being drilled in the Bakken
The story:
By the time most townsfolk learned of the plans by Procore Logistics LLC of Calgary, Alberta, the land was purchased, the permits largely secured, and construction of the rail facility and nearby man camp were under way.
Procore is investing at least $30 million in this town, which has an annual budget of about $250,000. The project alone will more than double Bainville’s population within two years and send 150 trucks a day — and eventually as many as 600 a day — steaming into the nearby oil field.
To solve Procore’s “heads and beds” problem for its 350 workers, work has begun on an employee man camp on Bainville’s eastern edge. The camp will be a mix of pre-manufactured dorms with some multifamily housing, a dining facility, gym and theater.
And that's just the beginning.
It's an incredible story. Go to the link. It will give folks outside the Bakken some idea how fast things have moved, and are moving, in the Bakken.

This may be "the longest, straightest section of track between Wisconsin and the Bakken," but my hunch is there were other reasons Procore Logistics LLC of Calgary, Alberta (Canada) selected Bainville. Regular readers of the blog already know what I'm thinking. [Longest, straightest section of track? All kinds of track is being laid in North Dakota for crude-by-rail projects; I assume new track could have been laid anywhere between Minot/Bismarck and the North Dakota/Montana state line.]

The promoter of this new fracking sand off-loading facility says this was as close as they could get to Williston -- 28 miles. In fact, as oil activity moves back into Montana, Bainville is as close to the "new" Bakken epicenter as Williston was is to the "old" Bakken epicenter.

Another One To File: I Can't Make This Stuff Up -- Nothing To Do With The Bakken

Utah officials have given a Canadian company the green light to begin mining oil sands on a remote plateau in Eastern Utah without first obtaining a pollution permit or monitoring groundwater quality, an action that sets the stage for a possible court battle over the fragile region.
No groundwater permit? "Walloping white water, Batman!"

"Hold on, Robin. There is no water there."
Chris Hogle, an attorney representing the company, told the board that water quality officials and U.S. Oil Sands hydrologists had "traipsed" over the ... mine site for years searching for water.
"They didn't find any," he said. "What water there is is disconnected from the mine site and will not be impacted."
And so it goes. Link to Bloomberg here

Something tells me the fact there is no water there will make little difference to the feds.

Jobless Rate Probably Climbed in October Amid Lax Hiring; Frankenstorm Sandy Updates

Updates

November 10, 2012: a bit of trivia comes to light regarding Long Power Light Authority following Frankenstorm Sandy. The dots are starting to connect.


November 9, 2012: liquor drought; authorities want US military to come in to restore power.

November 9, 2012: still out of juice

November 8, 2012: after Sandy, no one lined up for wind turbines.


November 6, 2012: a nor-easter to follow Sandy.

November 6, 2012: Hurricane Sandy and the failures of blue-statism

November 2, 2012: Hurricane Sandy headlines at Drudge.

November 2, 2012: despite Sandy, CLNE was able to get 49 natural gas stations up and running.

November 1, 2012: instant Karma.


Later, 6:29 pm: MDW dots connecting. The other day the global warming story about an early snowfall walloping northern California and now a photo of a global warming winter snowstorm in Montana affecting Frankenstorm Sandy. At the link:
Officials are bracing for the worst: nearly a foot of rain, high winds and up to 2 feet of snow in the highest parts of the Appalachian Mountains from West Virginia to North Carolina.
Later, 6:16 pm: The original post was about the jobless rate, but I included a note to the granddaughters regarding Frankenstorm Sandy. Now more news is coming in regarding the storm. This is particularly interesting: schools in Belmont (west of Boston), where our granddaughters attend school, have just announced cancellation of school for tomorrow. Wow.  And then this: the extratropical cyclone could wreak havoc on the refineries in the northeast.
By 6 pm ET Sunday both the Delaware Bay and New York Harbor will be closed to tanker and barge traffic. This means that the refineries will no longer be able to receive crude oil or load out product.
Product outages can occur not only in the New York and Philadelphia metro areas but extend to Bridgeport, New Haven, Providence and Boston.
As this is written, all five refineries are operating. I expect that they will have to reduce crude processing rates by 40 percent in order to make it through until crude oil resupply resumes.
Original Post

That was the Bloomberg headline: jobless rate probably climbed in October amid lax hiring.

I'm trying to think of the other reasons that would cause the jobless rate to go up.

I can't make this stuff up.

The jobless rate climbing is hardly due to firings and layoffs (though that is part of the story) but the huge firings and layoffs over the past three or four years have cut employee rolls pretty much to the bone, I would think; there's not a lot of fat left in any industry for additional firings and layoffs, I don't suppose. I guess we might see some large disruptions yet in the banking business: Bank of America will cut 16,000 jobs by December. UBS will cut 10,000 jobs.

A Note To the Granddaughters

[Faux environmentalists / global warming fanatics said that Hurricane Sandy was an example of global warming. They did not mention that Hurricane Sandy was barely a Category 1 when it hit New England. No one mentioned the Great Hurricane of 1938 that was a Category 5 over the ocean and was a Category 3 hurricane when it hit New England landfall.]

The East Coast is awaiting the arrival of Tropical Storm Sandy. Or Hurricane Sandy. Or "Frankenstorm Sandy." Or Extratropical Cyclone Sandy.
After moving ashore, Sandy is expected to become an extratropical cyclone rather than a hurricane — but people in its path may not notice the difference. The National Hurricane Center said “it is important to note that this transition will not diminish the overall impacts of this dangerous weather system.”  -- New York Times
The difference between a cyclone and a hurricane is a) the number of syllables; and, b) one starts with a "soft" "c" and one starts with a "hard" "h." But other than that, those in the middle of one or the other would be hard pressed to tell the difference. 

Whatever. The Boston-Framingham radio station WROR is predicting winds of over 500 mph which will they say will result in some broken tree limbs and 18 feet of rain which will cause some local flooding in low-lying areas. And then something about a huge octopus....

So, I drove Miss Daisey up to the north shore (Gloucester-Ipswich-Plum Island) to see first-hand the enormity of the storm at noon, Sunday, about the time the storm was hitting the coast much farther south. It was (and still is) overcast, quite windy, with intermittent rain, but mostly heavy mist. The ocean (as seen from the shore) is full of white-caps, probably four-foot swells. And already causing significant beach erosion. Foreshadowing rising ocean levels due to global warming this next century.

We stopped in at one of favorite destinations, Mass Audubon's Joppa Flats Education Center, just outside Newburyport. No birds today; they are all hunkered down somewhere. We did see one fishing boat, a small trawler of some sorts, high-tailing it into safe harbors. (There's probably a better nautical word for "high-tailing" but I grew up in North Dakota where I didn't see many trawlers.) Speaking of which, our older granddaughter, age 9, wants to be a marine biologist when she grows up and live either in Arizona or North Dakota, where she says the houses are ten miles apart and people have large backyards. A long commute, no doubt, from her house to work.

How Big Is the Minnesota/Wisconsin Fracking Sand Story? Huge --- If This Is Any Indication

America's Sandbox


From a PGL presentation, February, 2013

Updates

October 29, 2012: CarpeDiem weighs in on same story.

Original Post
This story in the Minneapolis Star-Tribune has any number of story lines if you want to look for them. The tone of this story tells me that the appetite for sand for the Bakken and Eagle Ford is huge -- but we already knew that, and then all those gas wells elsewhere.

The sand in Wisconsin/Minnesota -- just a short rail trip to North Dakota. Funny how things work out.

Nothing to do with the Bakken, but I love the steel guitar:
Heart With No Companion, Leonard Cohen

Wow! Great Photo-Journalism of the "Gold Rush" in North Dakota

Huge "thank you" to a reader. I  had missed this one: link to Reuters here; October 23, 2012, story -- so current.

Saturday, October 27, 2012

Week 43: October 21, 2012 -- October 27, 2012

This week was the start of earnings for 3Q12; see sidebar at the right.

Bakken Operations
Halcon buys 81,000 net acres from Petro-Hunt
New operator in the Bakken: Williston Exploration/Medora Minerals
BEXP with three big wells
BEXP's incredible Strobeck wells 
BEXP's incredible Clifford Bakke wells
Sounds like OXY getting ready to stack its rigs
ONEOK's Bakken Crude Express Pipeline taking orders
Bakken hits new production record; 40% of Bakken oil is going out by rail
CLR Hawkinson wells in Oakdale -- testing the lower benches?

Commentary
Supply boom upends oil market
US production could exceed Saudi's
Bakken rock clearly the source for both Bakken and Three Forks

Economic Activity
Counties secure $370 million in loans for electric grid build-out
Electricity demand could triple in western North Dakota over next 20 years
Another 123-single family unit development, east of Dickinson

Miscellaneous
North Dakota potash story: quiet but not quite dead

New Truck Wash in Dickinson; One To Follow In Williston

Link here to Dickinson Press.
The mess on oil field trucks that haul oil or other chemicals and solutions used in the drill process is not the same as the mess on cars, and needs to be cleaned carefully to make sure hazardous chemicals don’t end up in the water supply, Vice President Tyson Olson said.
The two, from Bozeman, Mont., decided to set up shop in Dickinson because they wanted to protect the environment and clean the thousands of trucks in the Bakken, President Troy Butler said. The truck wash facility has been open since June.
One to follow in Williston in the spring according to the article.

US Postal Service Hits Borrowing Limit

Updates

October 28, 2012: as I noted in the original post, October 16, 2012: this was a headline only. I haven't heard a thing since. No one cares. Someone noted that there is no such thing as "borrowing limit" in Washington.

Original Post
I assume, like the two pension payments it has not made, this will be a headline only.
The U.S. Postal Service in September hit its $15 billion borrowing limit from the U.S. Treasury for the first time in its history, leaving the agency with only the revenue it takes in from selling stamps, shipping and other services to cover its enormous operating costs.
The Postal Service has added $2.4 billion to its debt since June 30, pushing the agency to its borrowing cap, a spokesman said Tuesday. "Being at the limit is a serious situation because our limited liquidity does not give us operating flexibility," Postal Service spokesman David Partenheimer said. "Without passage of comprehensive legislation as part of the Postal Service's business plan to return to financial stability, we continue to project low levels of cash."
The agency hit the limit in late September, though it had sufficient cash reserves to make a $1.4 billion workers compensation payment on Monday, Mr. Partenheimer said. The Postal Service was set to disclose its borrowing situation in an annual financial filing due out on Nov. 15. The Postal Service is on a fiscal year that ends Sept. 30.
$2.4 billion added since June 30th -- $2.4 billion every three months?

File Under: No Good Deed Goes Unpunished....

Folks in Minnesota are conserving electricity -- so, their rates will go up....

Link here to Star-Tribune.com.
Xcel intends to file a request next week with the Minnesota Public Utilities Commission for a 2013 electric rate hike, with an interim increase to be sought on Jan. 1. Madden offered few details, but said higher rates are needed to pay for investments in Xcel's two nuclear power plants in Minnesota and to cover other cost increases.
CEO Ben Fowke said Xcel intends to seek additional rate increases in the years ahead in Minnesota under a new, multiyear regulatory process. He said Xcel also will file requests this year for a gas rate hike in Colorado and electric rate hikes in Texas, New Mexico and North Dakota.
Minnesota's largest electric utility is still making money. But its customers in the Midwest aren't demanding more power the way they used to.
For 2013, Xcel expects only a 0.5 percent increase in electricity demand, with even less growth in Minnesota and no growth in Wisconsin, she said.
Nuclear energy? Yes, nuclear is part of the "all-the-above" excepting fossil fuel.

I thought Xcel  had a wind farm in North Dakota, but googling reminded me that Xcel was mentioned but then canceled a wind farm project back in 2011. The "official" reason had to do with uncertainty surrounding regulations protecting migratory birds; my hunch it had to do more with the uncertainty of tax credits ending in 2012.

Friday, October 26, 2012

Doomsday: The American Worker

Long-Term Trends

March 14, 2016: Look at the stunning loss of manufacturing jobs in the US under the Obama administration

17 disappearing American jobs, March 6, 2016, in USA Today. I don't think this adds anything to the discussion; it must have been a slow news-day. Obviously jobs connected with the print media and US postal service are disappearing. However, saying US postal service jobs are disappearing does not mean jobs connected with parcel delivery will be disappearing; in fact those jobs (think Amazon) will be increasing: logistics; physical delivery (land, outsourced); physical delivery (drones, outsourced). Demand for same-day delivery will drive an increase in jobs and an increase in logistics.

Other Links

Daily job losses

The Near-Recession 2016

Kohl's is closing stores as the department store industry collapses, February 26, 2016.

Carrier (air conditioning) plant in Indianapolis, 1,400 employees, to close; move operations to Monterrey, Mexico, February, 2016.

Health care conglomerate Johnson & Johnson to cut 3,000 jobs in medical devices division over next 2 years, January 19, 2016.

Now, The Oil Bust of 2014 - 2016

Anadarko to cut 1,000 jobs, March 12, 2016.

Halliburton will slash another 5,000 jobs, February 26, 2016.

Chevron to cut 7,000 employees, no link, reported everywhere, October 30, 2015.

Halliburton announces another huge round of job cuts, September, 21, 2105.

US Steel to lay off 750 employees at tubular steel plant due directly to oil bust of 2014 - 2015.

Weatherford to cut an additional 3,000 jobs, October 23, 2015.

Data Points & Updates

McKesson, drug distributor, to cut 1,600 employees, 4% of its US workforce, March 16, 2016.

Kraft Heinz to close seven plants, cut 2,600 jobs. November 4, 2015.

Target to close 13 stores nationwide; layoffs in 2015 total about 2,500 so far, but that was mostly corporate. November 4, 2015. 

3M to cut 1,500 workers, October 22, 2015.

ESPN to cut 4% of its workforce, October 22, 2015.

MillerCoors closes plant in North Carolina; one of eight breweries. Loss of 500 jobs. Popularity of craft beers to blame. I can't remember the last time I bought a non-craft beer; must be decades.

Monsanto slashing 2,600 jobs. Will exit the sugar cane business. October 7, 2015.

ConAgra cuts 1,000 jobs; moves HQ from Omaha to Chicago. October 1, 2015.

Last US-owned uranium plant likely to close -- on Obama's orders.  The number of jobs is inconsequential (unless you are one of those to be laid off permanently) but these are high-tech jobs, I would assume, where it might be nice to have US expertise. Whatever. I'm trying to think of one thing Obama has done correctly in the last eight years. The irony, of course, is he has done everything he can to get the Iranian uranium-enrichment program back on-line. September 29, 2015.

Caterpillar to lay-off up to 10,000 employees, September 24, 2015.

HP to cut another 30,000 employees, September 16, 2015.

Hershey's to cut 300 employees, June 19, 2015. We are seven years into the recovery, a gazillion dollars in stimulus, still no hike in interest rates by the Fed, and we're still seeing layoffs. 

HP's layoffs at 55,000 and rising, October 7, 2014.

Dell to cut 15,000 jobs worldwide, February 5, 2014. 

Lockheed Martin to lay off 4,000 workers; many in California. The LA Times is reporting:
The Bethesda, Md.-based company said it would close plants in Pennsylvania, Ohio, Texas and Arizona by the middle of 2015. It will also close four buildings at its Sunnyvale, Calif., campus. November 14, 2013.
American Express to cut 5,400 jobs; 8.5% of its workforce, Boeing to cut 40% of its workforce at El Paso, TX; January 9, 2013. 

Morgan Stanley cuts 1,600 jobs, January 9, 2013. 

Pfizer to cut 600 jobs; Lipitor goes generic; decreased sales, December 19, 2012.

US corporate layoffs to reach 18,000 this week -- and this is not the Hostess story. The number will surpass the average weekly October loss, probably due to Ford's announcement.
  • Ford: 9,500 Belgium plant
  • Dow Chemical: 2,400
  • Newell Rubbermaid: 1,900
  • Advanced Micro Devices: 1,665
  • DuPont: 1,500
  • Proctor & Gamble: running ahead of its schedule to eliminate 5,700 jobs this year
“This week stands out a little bit, because they all seemed to hit at the same time and they were all large, well-known companies,” he said. “However, in comparison to recession-level cuts, we still consider these numbers pretty tame.”  Pretty tame.
Steve's take on this: "While some of the job cuts this week seem pretty intimidating, at least it’s not a sign of a major downturn in the economy, hopefully."

Hopefully.

Orlando Health to cut record number of jobs to save money, November 19, 2012.
For the first time in its nearly 100-year history, Orlando Health is reducing its workforce by up to 400 positions starting immediately, hospital officials announced this morning.

The elimination of 300 to 400 jobs will occur in two phases, and represents a 2- to 3-percent decrease in the system's 16,000 employees, said Orlando Health spokeswoman Kena Lewis. The reductions affect all departments and all eight of its hospitals. 
Kodak to cut another 1,000 workers; total will be nearly 4,000 by end of year, November 17, 2012.

Twenty percent of Yahoo's employees at risk: cut in benefits, or being laid off, November 16, 2012.

SuperValu cuts benefits in 2013 for salaried workers; end to merit pay; end to 401(k) matches; shift from weekly to monthly checks for some; affected: salaried workers in Cub Foods, Jewel Osco, and Albertson stores; November 16, 2012

Twinkies liquidates; 18,500 jobs lost, November 16, 2012.

Banks cutting jobs; numbers are staggering; will far exceed any other industry as far as I can tell; November 16, 2012

Texas Instruments to lay off 1,700 to cut costs; November 14, 2012

NBC Universal cuts 500 jobs, November 12, 2012

Many Wal-Mart workers will drop health insurance because of rising premiums (ObamaCare), November 12, 2012

Vestas wind: another 3,000; almost doubles original planned layoffs, November 9, 2012

Murray Energy (based in the swing state of Ohio), will lay off 54 miners at American Coal (a subsidiary) and 102 at Utah American Energy; cites President Obama's "war on coal, November 9, 2012

Utah coal company, West Ridge Mine, effective immediately, 102 miners, November 9, 2012

Wow, here are the layoffs coming, all directly related to ObamaCare; remember, the new work week is now defined as 30 hours; a lot of high-tech jobs can be done in 29-hour weeks accomplishing what used to take 40 - 60 hours; November 9, 2012
  • Welch Allyn: 275
  • Dana Holding: unknown
  • Stryker: 96 in December; 1,170 more anticipated
  • Boston Scientific: 1,400; with other jobs shifted to China
  • Medtronic: 500 this past summer; 500 more in 2013
  • Smith & Nephew: 770
  • Abbott Labs: 700
  • Covidien: 595
  • Kinetic Concepts: 427
  • St Jude Medical: 300
  • Hill Room: 200
Fewer workers, more productivity, CarpeDiem, November 8, 2012

Lockheed Martin has reduced its management ranks by about 25 percent in recent years after announcing a voluntary buyout, November 8, 2012

Huge Boeing cuts, company employment now less than 2007 level, restructuring due to defense contracts, November 8, 2012
Boeing announced a major restructuring of its defense division on Wednesday that will cut 30 percent of management jobs from 2010 levels, close facilities in California and consolidate several business units to cut costs. 
He said Boeing would cut the number of executive jobs an additional 10 percent by the end of 2012, bringing overall cuts in its executive team to 30 percent for the past two years, a move that would result in a 10 percent cut in management costs.
Las Vegas employer: Obama won, so I cut 22 jobs, November 8, 2012

Dow to cut "thousands of workers," losing big on batteries October 30, 2012

UBS to cut 16,000 jobs worldwide, October 26, 2012
Switzerland's biggest bank, UBS AG , is expected to cut up to 10,000 jobs, or 16 percent of its workforce, as it contends with shrinking revenue and rising capital requirements,...
Eagle Ford -- driving job creation, October 26, 2012
Eagle Ford shale activity will continue to drive job creation in South Texas through 2021, with the level of experience required and types of labor demand evolving as Eagle Ford activity shifts from exploration to production, according to a recent analysis by the Institute for Economic Development at the University of Texas at San Antonio (UTSA).
Gallagher's, NYC steakhouse, to close; had survived the Great Depression, but not the Great Recession -- October 25, 2012

Dow Chemical to cut 2,400 jobs and shut 20 manufacturing plants -- October 24, 2012.
Chemical will cut about 2,400 jobs and shut 20 manufacturing plants, including one in Midland, to reduce annual costs by $500 million in the face of slow global economic growth.
The facilities to be closed are in the U.S., Belgium, Netherlands, Spain, the U.K. and Japan in addition to the Automotive Systems Diesel Particulate Filters plant in Midland, Dow said Tuesday. An additional $500 million will be saved by cutting capital spending and curtailing some investments, Dow said.
The job cuts, which amount to 5% of Dow's global work force, follow DuPont's announcement Monday that it's eliminating 1,500 jobs in part because of declining demand for paint pigment and solar cells. Dow Chairman and CEO Andrew Liveris said in July the company is operating in the worst conditions since 2009.
Ford to close Belgian factory -- October 24, 2012
Ford is to close one of its main European factories in Belgium with the loss of more than 9,000 jobs. Exactly half a century after construction on the Genk plant started, Ford told a management council there that production was winding down since slumping European sales has forced a restructuring. 
Ford to shed 1,400 jobs in England -- October 25, 2012

Bank of America to cut 16,000 jobs by end of year -- September 20, 2012

Arch Coal to cut 750 jobs in Appalachia -- June 22, 2012

Bakken-Support Plant To Open in Rapid City, South Dakota

Updates

November 3, 2011: The Rapid City Journal says the plant will be in Belle Fourche.
Pipeline Plastics has begun breaking ground on the northwest edge of Belle Fourche for a manufacturing plant that is expected to bring as many as 40 jobs to the community.
City and local business officials are working with the Texas company for an official groundbreaking they hope will be before Thanksgiving.
Mayor Gary Hendrickson said Friday the new plant is just the first success in the city's effort to further cash in on the Bakken oil field boom in North Dakota.
Belle Fourche has railroad and four-lane highway connections to Interstate 90. U.S. Highway 85 carries increasing traffic to the Bakken development, all of which Hendrickson said makes the city an ideal staging, manufacturing and transportation center.
Pipeline Plastics vice president Keith Fisher said Friday that the firm has worked on the project since spring. All the pieces finally came together to close on land earlier in the week.


Original Post
Link here to Dickinson Press.
A Texas-based pipe maker has started construction on a manufacturing plant in Rapid City.
WL Plastics Director Mike Dahl says the South Dakota plant will help supply North Dakota's oil industry. The plant will employ about 40 people.

WLL -- Analysis -- 3Q12

Link here to SeekingAlpha.com.
[The author at the link] originally invested in WLL because of their large Bakken acreage combined with their leading well production metrics. In that respect, the company is performing as expected and production is increasing nicely. However, the stock has not followed suit. Not enough of the new production revenue is falling to the bottom line as net income. This is because costs and expenses are rising right along with growing production. So let's take a look at the expense side of the company to see if we can figure out what is happening.

Statoil (BEXP) -- Transcript

Link to SeekingAlpha.com.

For newbies: Statoil (Norway) bought BEXP last year. Statoil continues to operate in the Bakken as BEXP.

Selected data points and quotes (taken out of context) from the link:
Q: Do you have any plans on increasing activity in Bakken and Eagle Ford? And how many rigs are you planning to ramp in these different basins next year?

A: Yes, we have plans to increase production in Bakken and Eagle Ford. So for instance, Bakken is producing some 38,000 barrels per day in this quarter. When we acquired it a year ago, we produced 21,000 barrels per day. So it's almost doubled. We are continuing with the -- is it 15, Svein, 15 rigs now? Yes, 14 to 15. 14 to 15 rigs in Bakken. Our operations actually runs very smoothly. In Eagle Ford does gas and liquids, and so what is the number of rigs that we are running there? I can't recall the specific number. It's -- I think we're running 9 rigs there in the Eagle Ford currently, which is approximately on the level we have been.
********************
Then, we produced 38,000 barrels per day from Bakken, the asset that we acquired a year ago, and we have added rail capacity to that asset and bypassing the pipeline bottlenecks that is currently -- that we are currently experiencing in that area. And that is to ensure that we get the oil to the market at the highest price possible and reducing the differentials, and we see that it works. And our trading organization in Stamford create a lot of value from these barrels.
********************
We are currently ramping up production from Peregrino, Pazflor, Marcellus, Bakken, Eagle Ford, and then we plan to bring 3 fast-track projects onstream during the next -- during the fourth quarter.

Rigs Counts and Natural Gas -- Two-Part Series

Link from SeekingAlpha.com.

Part I:
The examples and discussion [in Part I] illustrate that it may be precarious to rely on a simplistic historical correlation between the rig counts and production to derive supply forecasts. To be a meaningful tool in future production estimation, the rig count requires a granular, play-by-play analysis and careful interpretation.
I assume Part II will be forthcoming.

Twenty-One (21) New Permits; BEXP WIth Three (3) Nice Wells; Newfield With Two New Permits; OXY USA - No New Permits

Bakken Operations

Active rigs: 186 (steady)

Twenty-one new permits for yesterday and today (Thursday and Friday):
  • Operators: CLR (8), Triangle (4), Whiting (3), Newfield (3), Oasis (2), Baytex, EOG,
  • Fields: Pleasant Hill (McKenzie), Bully (McKenzie), Rawson (McKenzie), Ambrose (Divide), Parshall (Mountrail),
  • Comments: Finally some Newfield permits; another day with no new OXY USA permits;
Wells coming off confidential list:
  • 19914, 489, OXY USA, Rebsom 1-23-14H-95, t4/12; cum 28K 9/12;
  • 19950, 221, Petro Hunt, Grev 157-100-31D-30-1H, t7/12; cum 16K 9/12;
  • 20524, 875, Whiting, Bell Lake Creek 44-23TFH, t5/12; cum 36K 9/12;
  • 20748, 599, Liberty Resources, Lindy 156-100-10-3-1H, t5/12; cum 43K 9/12;
  • 21517, drl, CLR, Omar 6-12H, North Tioga,
  • 21652, 237, Petro-Hunt, Fort Berthold 152-93-18B-19-2H, Four Bears, t9/12 cum --
  • 22609, 327, CLR, Kubas 1-22H, t8/12; cum 12K 9/12;
Producing wells completed:
  • 21952, 4,293, BEXP, Sorenson 29-32 3H, Alger, t9/12; cum --
  • 21954, 3,078, BEXP, Sorenson 29-32 4H, Alger, t9/12; cum --
  • 22082, 3,058, BEXP, Smith Farm 22-14 2H, Cow Creek, t9/12; cum --