Thursday, February 16, 2012

This Pretty Well Summarizes What "We" Have To Look Forward To ....

....if we have same top cover for the EPA after November, 2012.

Top ten (10) legal issues facing the oil and gas industry in 2012 and most (all?) of them have to do with fracking and issues related to fracking.

EOG -- 4Q11 and 2011 Results -- 320-Acre Spacing in the Bakken -- Raises Dividend

EOG today reported fourth quarter 2011 net income of $120.7 million, or $0.45 per share. This compares to fourth quarter 2010 net income of $53.7 million, or $0.21 per share. For the full year 2011, EOG reported net income of $1,091.1 million, or $4.10 per share, as compared to $160.7 million, or $0.63 per share, for the full year 2010.

The press release.

Most of the press release had to do with EOG's largest asset, the Eagle Ford in Texas, which was incredible for investors, but this about the Bakken, was also quite incredible:
Consistent with its game plan to increase recovery rates in existing fields, during 2011 EOG continued infill drilling on its core acreage in the North Dakota Bakken Parshall Field, which it discovered in 2006.

Although originally developed on 640-acre spacing, EOG has successfully tested 320-acre down-spacing in various areas and around the perimeters of the field. A recent well in Mountrail County, the Fertile 48-0905H, in which EOG has a 96 percent working interest, was completed at an initial rate of 1,324 Bopd. Also in Mountrail County, the Liberty 24-2531H and Liberty LR 20-26H were drilled on 320-acre spacing.

The wells, in which EOG has 82 and 95 percent working interest, respectively, were turned to sales at initial crude oil rates of 1,507 and 1,165 Bopd, respectively. Over the course of 2012, EOG will continue its efforts to increase recovery of the oil-in-place on its Bakken acreage through further down-spacing tests and the initiation of a secondary recovery pilot project. [See first comment: water vs CO2?]
320-acre spacing. I-M-P-R-E-S-S-I-V-E.

Going forward:
EOG has hedged approximately 23 percent of its North American crude oil production for 2012. For the period February 1 through June 30, 2012, EOG has crude oil financial price swap contracts in place for approximately 33 percent of its production at a weighted average price of $105.36 per barrel, excluding unexercised options. For the period July 1 through December 31, 2012, EOG has 14 percent of its production hedged at a weighted average price of $104.26 per barrel, excluding unexercised options.

Ten (10) New Permits -- The Williston Basin, North Dakota, USA

Daily activity report, February 16, 2012 --

Operators: OXY USA (4), Petro-Hunt (2), Oasis, Hess, MRO, G3 Operating

Fields: Sorkness, Clear Creek, Russian Creek, Murphy Creek, Simon Butte, Big Bend

G3 Operating has a permit for a wildcat in Williams County.

No IPs reported today.

Manitou Oil Field -- The Bakken, North Dakota, USA

30660, conf, Hess,
30659, conf, Hess,
30658, conf, Hess,
30657, conf, Hess,
30439, conf, Hess,
30438, conf, Hess,

2014 (list is complete)
29586, conf, Hess,
29585, conf, Hess,
28099, SI/IA, Hess, EN-Dobrovolny A-155-95-2413H-7,
28098, 726, Hess, t1/15; cum --
28097, 596, Hess, t1/15; cum 4K 12/14;
28096, 524, Hess, t12/14; cum 10K 12/14;

2013 (list is complete)
27316, 490, Hess, EN-Joyce-LE-156-94-1721H-3, t9/14; cum 29K 12/14;
27315, 142, Hess, t8/14; cum 32K 12/14;
27314, 349, Hess, t9/14; cum 28K 12/14;
27313, 781, Hess, t7/14; cum 58K 12/14;
27255, 386, Hess, t11/14; cum 16K 12/14;
27254, 671, Hess, t7/14; cum 35K 12/14;
27253, 908, Hess, t7/14; cum 55K 12/14;
27099, 680, Hess, t7/14; cum 36K 12/14;
27098, 953, Hess, t6/14; cum 58K 12/14;
27097, 558, Hess, t7/14; cum 47K 12/14;

2012 (list is complete)
23553, 500, Hess, EN-Hanson S-156-94-310-H-6, Manitou, t2/13; cum 57K 12/14; 
23552, 428, Hess, EN-Hanson S-156-94-3130H-5, Manitou, t2/13; cum 55K 12/14;
23551, 402, Hess, EN-Hanson S-156-94-3130H-4, Manitou, t3/13; cum 47K 12/14;
23418, 625, Hess, EN-Hegland 155-94-0508H-3, Manitou, t2/13; cum 94K 12/14;
23417, 447, Hess, EN-Hegland 155-94-0508H-2, Manitou, t2/13; cum 91K 12/14;
22674, 890, Hess, EN-Rice-155-94-0211H-3, Manitou, t10/12; cum 130K 12/14;
22673, 1,048, Hess, EN-Rice-155-9490211H-2, Manitou, t10/12; cum 142K 12/14;
22510, 264, Hess, EN-Hanson-156-94-3031H-3, Manitou, t8/12; cum 43K 12/14;
22509, 468, Hess, EN-Hanson-156-94-3031H-2, Manitou,  t8/12; cum 66K 12/14;
22398, 379, Hess, EN-Dakota S-155-94-211609H-6, Manitou, t10/12; cum 58K 12/14;
22397, 149, Hess, EN-Dakota S-155-94-211609H-5, Manitou, t10/12; cum 29K 12/14;
22396, 479, Hess, EN-Dakota S-155-94-211609H-4, Manitou, t10/12; cum 62K 12/14;
22395, 660, Hess, EN-Dakota N-155-94-211609H-1, Manitou, t8/12; cum 105K 12/14;
22394, 705, Hess, EN-Dakota N-155-94-211609H-2, Manitou, t8/12; cum 130K 12/14;
22393, 753, Hess, EN-Dakota N-155-94-211609H-3, Manitou, t8/12;cum 105K 12/14;

Original Post
Manitou oil field has been in the news recently with several new permits.

But the reason I decided to write about Manitou this morning is because of a bit of trivia. His first time to the Dakotas, Theodore Roosevelt bought a horse named Nell. That was in 1883; he was not quite 25 years old. The following year, he bought a new horse and named it Manitou. [Source: Dan Aadland, c. 2010, p. 9.]

Manitou oil field is 36 sections, irregularly shaped, north of the river, and just north of the bull's eye of the Bakken. It is about six miles southwest of Tioga, the "oil capital" of North Dakota. The oil field shares a border with the first North Dakota oil field, the Beaver Lodge, to its west, and with Alger oil field to the east. Both of these fields have been incredibly good fields, and it looks like Manitou will join them.

Currently, the field averages about one well per section, but this should change over time.

The most interesting set of wells right now is the six-well pad operated by Hess:
  • 19983, running north, 845, Hess, EN-Ruland A-155-94-1201H-1, Manitou, s1/11; t8/11; F; cum 175K 12/14; 38 stages; 1.7 million lbs total; 831K ceramics; Three Forks
  • 19985, running south, 1,073, Hess, EN-Dobrovolny A-155-94-1324H-1, Manitou, s1/11; t7/11; AL; cum 182K 12/14; frack report to be submitted later; geologic markers to be submitted later
  • 19987, running north, 1,521, Hess, EN-Ruland A-155-94-1201H-2, Manitou, s1/11; t9/11; AL; cum 198K 12/14; frack report to be submitted later; geologic markers to be submitted later
  • 19988, running south, 743, EN-Dobrovolny A-155-94-324H-2, Manitou, s1/11; t10/11; AL; cum 142K 12/14;  middle Bakken; frack data to be reported later;
  • 19989, running north, 828, EN-Ruland A-155-94-1201H-3, Manitou, t3/12; cum 153K 12/14;
  • 19990, running south, 697, EN-Dobrovolny A-155-94-1324H-3, Manitou, s1/11; t12/11; AL; bcum 118K 12/14; Three Forks; frack data to be reported later;
Some other wells in this oil field:
  • 8936, PA/70, Bonray Energy, Thompson 4-1, Manitou, Red River (not a Bakken); s5/83; PNA 6/85; cum 14K
  • 15916, 71, Missouri River Royalty Corp, Manitou 4-1H, s2/06; t5/06; cum 33K 12/14;
  • 16674, 52, Hess, EN-Hegland-156-94 3229H-1, s7/07; t4/08; cum 35K 12/14; open hole frack; 289K lbs sand; 19K Slickwater; middle Bakken;
  • 16771, 268, Hess, EN-Ruland-156-94 3328H-1, s11/07; t1/09; cum 97K 12/14; open hole frack; .4 million lbs sand;
  • 18279, 357, Hess, EN-Rice A-155-94-0310H-1, s10/09; t1/10; cum 193K 12/14;

Hess has permits for another six wells in Manitou oil field:
  • 22393, see above, Hess, EN-Dakota N-155-94-211609H-3,
  • 22394, see above, Hess, EN-Dakota N-155-94-211609H-2,
  • 22395, see above, Hess, EN-Dakota N-155-94-211609H-1,
  • 22396, see above, Hess, EN-Dakota S-155-94-211609H-4,
  • 22397, see above, Hess, EN-Dakota S-155-94-211609H-5,
  • 22398, see above, Hess, EN-Dakota S-155-94-211609H-6,

GM Reports Weaker-Than-Expected 4Q11 -- Absolutely Nothing To Do With The Bakken

Link here to Yahoo News.
"We obviously have work to do still and a long way to get to the objectives we ultimately want to get to," GM Chief Financial Officer Dan Ammann told reporters.

"We clearly have work to do in Europe. We have work to do in the South America business. Frankly, we have work to do all around the company in terms of cost opportunity," he added.
But, he could have added, we know the President's new incentives for the Volt will turn the company around.
Net income attributable to common shareholders was $500 million, or 28 cents a share, compared with $500 million, or 31 cents a share, in the year-ago quarter.
I could be wrong, but I believe overall this was a better quarter for the auto industry than a year earlier, but I could be wrong. 

It was also announced yesterday that GM is eliminating the traditional pension plan for its salaried employees and replacing it with a 401(k). Ouch. The best of both worlds would have been a traditional pension plan along with a 401(k). There is also a headline that GM has frozen the pay of its salaried employees.

In all fairness, GM did post a record ANNUAL profit for 2011.

Peak Oil? What Peak Oil? Okay, It's LNG -- But The Big Picture -- And, Notes To My Granddaughters


February 16, 2012:  Incredible. Just after posting the story below, Motley Fool chimes in wtih "The End of Peak Oil Theory."
Last week I got caught up in a show from a few years ago called "Mega Disasters: Oil Apocalypse" on The History Channel, spelling out the doom our economy was facing as oil production declined over the next 100 years. Domestic production was already declining, and we had no plan B. Stock up on canned soup and ammo while you still can!

If you haven't noticed, the oil apocalypse has been delayed -- again -- and the doomsday predictors are undoubtedly eating crow while they concoct another mega disaster. "Peak oil,"...

It's amazing how fast perceptions of our energy future can change. One day prevailing wisdom tells us that energy costs are going to rise uncontrollably as oil production declines and new energy sources fail to live up to their promise...

The oil scare that never goes away

We've been hearing about peak oil for years, and even some of the brightest minds in energy think the theory has some validity. But, like any other apocalypse, it never quite seems to unfold as the predictions assert. There are just too many factors that peak oil prognosticators can't account for in their bold predictions, so they always get them wrong.
Original Post

"World Could See LNG Glut in 2018"
Link to PennEnergy.

Oversupply in the domestic natural gas market has led many producers to push for the expansion of liquid natural gas processing capacity.

[One analyst] estimates that roughly 250 million metric tons of new gas processing capacity should be available by 2018. Already LNG plants with a production capacity of 68 million metric tons of gas are in the planning phase.

By comparison, estimates suggests that global demand for LNG could rise to 408 million metric tons by the end of the decade. 
With the right American leadership, this could be America's decade. We have a 10-year head start and manufacturers are starting to come back to the states.

This has huge implications for companies like XOM and COP.

[Note: see first comment -- "Union Pacific Railroad says it will spend $200 million to expand its operations in South Louisiana to meet expected higher customer demand from petrochemical plants along the Mississippi River." -- just one example of increased US manufacturing on the back of "LNG glut." Something tells me American entrepreneurs will be able to figure out how to turn this "glut" into a non-problem.]


But have you ever noticed that when a manufacturing company wants to re-locate in the US, the faux-environmentalists do what they can to stop growth? The folks protesting the fracking sand sites in Winona, Minnesota are but just the most recent example.

Don Nelson of Winona, who stood among the group blocking the trucks, said he recognized several of the drivers from high school.

"It's a mixed feeling," he said. "These truckers are trying to make a living."

"We do want (the truck drivers) to know this is a bad industry," said Daniel Wilson of Winona.

"This isn't personal, but we don't want this happening in our community."
Yup, these truckers are simply trying to make a living and support their families. I wonder what Daniel Wilson and Don Nelson do for a living?

"...we don't want this happening in our community..." says it all.


Notes to My Granddaughters

I'm not exactly sure where you should start with Shakespeare when it comes to studying his works. I think I would read simultaneously, and more than several times, three of his four great tragedies (King Lear, Hamlet, and Macbeth); histories of England from the War of Roses through Queen Elizabeth I; and, Brenda James' The Truth Will Out: Unmasking the Real Shakespeare, c. 2006.

I assume the histories by Shakespeare would be as important, but I do not know them as well yet. 

Some data points regarding William Shakespeare:

  • his parents were illiterate; unlikely any book in the household when Wm growing up
  • he grew up in a small provincial town with but a handful of educated men
  • his schooling ended when he was about 12 years old
  • there is no evidence that he ever owned a book
  • not one piece of written work attributed to him survives; not one piece
  • the only writing that can be ascribed to Wm Shakespeare are six signatures; three of them on his will
  • of 75 contemporary documents, not one concerns a career as an author
  • when "the" folio was published 7 years after his death, it does not acknowledge his Stratford family
  • the Stratford household had no documents relating to the First Folio
  • the Stratford family, nor anyone, was known to have been given a copy of the First Folio
  • his two surviving daughters were illiterate
From Thomas Penns' Winter King: Henry VII and the Dawn of Tudor England, c. 2012:

  • The Woodvilles, Beauforts, and the Nevilles were the families behind the throne following the War of Roses and through the reign of Henry VIII
The Shakespeare author, who of course, was not William, but rather Sir Henry Neville:

  • the largest vocabulary of any author who ever lived
  • his works employ more than 18,000 different words
  • his works employ about twice as many as Milton, one of the most accomplished graduates of his time from Cambridge University
  • his works used perhaps as many as five times used by the average educated person today
  • Shakespeare coined more words than any other writer in history; coined about 1,500 words; many of those words are still in general use today [one of my personal favorites, because it relates to my older granddaughter who wants to be a marine biologist, is "alligator"]
But this is just the beginning:

  • he read voraciously
  • he cited or rephrased more than 200 classical and later writers
  • many of the books he used had not been translated into English in his time
  • read in Greek, French, Spanish, and Italian

Aerial Photos of the Bakken -- What a Great Way To Start the Morning

Link here.

The link will also be at my "Data Links" page.

I have not spent much time on this site but it looks like it might be fun to explore. It has much more than just oil. I particularly like the 9-wheat-combines-harvesting photo.

I get inquiries periodically about aerial photos of the Bakken, so this should be a great start. 

I am not associated with this site, but it looks like it should be fun to explore.