Wednesday, May 23, 2012

Coal's Share of US Electricity Generation -- CarpeDiem

Link here to and another great graph.

American Eagle's Christianson Well Begins Production -- Divide County -- Three Forks -- The Bakken, North Dakota, USA

Link here to Rigzone.

Data points:
  • Spyglass Bakken and Three Forks Project in Divide County
  • Christianson 15-12-163-101: the company's first operated well
  • IP: averaged 625 bopd
  • other American Eagle wells under discussion:
  • Cody 15-11-163-101, one mile west of Christianson; fracture stim completed of Three Forks zone
  • Coplan 1-3-163-101, currently drilling horizontally in Three Forks formation
  • all three wells long laterals
  • all three wells in adjacent 1280-acre spacing units
This ads to the growing list of nice Three Forks well near the Canadian border in North Dakota

NDIC Rules New Millennium Resource, Inc, Must Produce or Face Abandonment Order -- Near Belfield, North Dakota

Link here to Dickinson Press.
New Millennium Resource Inc. must produce oil from the Zenith-Tyler “A” Unit [by November 1], which is two miles northeast of Belfield, according to a commission order. If the wells are not brought back into production by Nov. 1, the company may have to plug and abandon the wells, Goehring said Tuesday.

There are four wells on the site that are supposed to be producing oil, said Lynn Helms, North Dakota Department of Mineral Resources director. Only one is in production.

Random Photos of TransCanada XL Pipeline Stacked Near Gascoyne, North Dakota

Hints of another crude-by-rail terminal near Gascoyne?

Huge thanks to a reader.

You can see this pipeline from space -- Google Maps, google Gascoyne, ND, and look to the northeast.

You don't think this pipeline would have resulted in a few shovel-ready jobs? This was the pipeline killed by the president. 

Five Stocks Insiders Love; Four Undervalued Energy Companies

The first story:
The first one mentioned: Continental Resources.

Two of the five are familiar to Bakken folks: CLR and Hess.

Link here.
Disclaimer: this is not an investment site. See welcome and disclaimer. I am not invested in any of companies mentioned at the link above.

The second story:
Two of the four undervalued are well known to Bakken folks: MRO and KOG.

Link to
Disclaimer: this is not an investment site. See welcome and disclaimer. I am not invested in any of companies mentioned at the second link above, either.

North Dakota To Match Oil Production From Texas -- Maybe Not a Pipe Dream

Link here.
North Dakota could double its oil production by 2015 to more than 1 million barrels daily, putting it on par with Texas "if everything goes our way," the state's top oil regulator told industry and government officials Wednesday.

Lynn Helms, director of the state Department of Mineral Resources, said the increase from about 575,000 barrels at present would depend on a strong global economy, steady oil prices and a favorable federal regulatory climate. 
Go to the linked story. There are other numbers that might catch your attention.

Remember this number: 900

Magnum Hunter to Buy Baytex Non-Operated Bakken Assets

Link here.

Note: this is just the non-operated interests. Some numbers rounded in data points below. Go to link for exact figures.

Data points
  • $312 million deal; Magnum Hunter subsidiary Bakken Hunter was the buyer
  • Magnum Hunter buys Baytex's non-operated interests in North Dakota
  • assets sold represent 45% of Baytex's net ND acreage; 40% of its current US production
  • Baytex says it will still drill 10 net wells in the Bakken/Three Forks as previously announced
  • Bakken Hunter estimates that new assets produced 950 boe/d of light oil production
  • 149,700 gross/50,400 net acres; 24% is developed
  • assets estimated to have proved reserves of 12 million boe (8 percent natural gas)
  • probably proved reserves of 18 million boe (8 percent natural gas)

If Only ---

Link here.
Billions of dollars will be needed to build additional pipelines, terminals, and storage facilities to bring new US oil and natural gas resources to market, experts said on May 21 during Deloitte LLP’s 2012 Washington Energy Conference.

Outlays of $10-20 billion/year could be required over the next 20 years to build new systems and facilities as well as modify existing ones, suggested Curt Launer, managing director of natural resources in Deutsche Bank’s Corporate Finance Coverage Group.
Perhaps later, some comments, or maybe I will save them for Thursday morning ramblings.

Three (3) New Permits -- Zenergy Has A Nice Well -- The Williston Basin, North Dakota, USA

Daily activity report, May 23, 2012 --

Operators: OXY USA (2), CLR
Fields: Manning (Dunn), Crazy Man Creek (Williams)

Two producing wells completed:
  • 20255, 892, EOG, Liberty LR 15-26H
  • 20105, 737, Zavanna, Crescent Farm 7-6 1H,
Four wells released from confidential status:
  • 20277, 1,213, Zenergy, Rolfsrud 18-19H,
  • 21709, DRL, BEXP, Borsheim Trust 33-28 3H,
  • 21768, DRL, SM Energy, Wolter 15-8H,
  • 21806, 854, CLR, Burian 1-27H, 
Correction to daily activity report, May 21, 2012:
  • 21389, 104, Legacy, Legacy et al Berge 1-12H, Bottineau

Canada's Trans Mountain Pipeline Deal Inked -- Kinder Morgan

Link here.

Data points:
  • will twin the existing 714-pipeline from Edmonton, Alberta, to Barnaby, British Columbia
  • 20-year contracts for additional 510,000 bbls/day; 150,000 bbls less -- some shippers did not get board approval
  • currently 300,000 bbls/day
  • will expand to about 750,000 (that's what the article said; the numbers don't quite add up)
  • $4.1 billion
 Link to earlier story regarding same.

St Demetrius Oil Field

St Demetrius is a relatively large oil field in the Williston Basin, located in Billings County, in southwestern North Dakota.  It encompasses approximately three townships (a township has 36 sections). It is irregular in shape, but pretty much rectangular with three townships stacked on top of each other.

It's hard to say exactly whether this field is in Whiting's Lewis & Clark prospect or its Pronghorn prospect. St Demetrius is just north of the Bell field (shared border). Some of the largest lease bonuses were paid for leases in Bell field. The field is just a bit west of a very prolific area including the Fayette, the Cabernet, and the Russian Creek fields.

It's a fairly active field, but the "tea leaves" suggest that it will be much more active going forward.  The southern half of St Demetrius appears to be the most active, which is to be expected, since the Bell field is just to the south.


28126, loc, Emerald, Mary Samsonite 6-16-21H,
28125, loc, Emerald, Mary Samsonite 5-16-21H,
28124, loc, Emerald, Mary Samsonite 4-16-21H,
28123, drl, Emerald, Mary Samsonite 3-16-21H,
28122, loc, Emerald, Mary Samsonite 2-16-21H,
28121, loc, Emerald, Mary Samsonite 1-16-21H,
27583, conf, CLR, Dunkirk 1-18AH1, producing, albeit not much;

2013 (complete)
Issued in 2012 (complete)
  • 24639, TA, Thunderbird Resources LP/GMXR, see #21947 below;
  • 24574, 904, Whiting, Wanner Federal 21-1TFH, t4/14; cum 25K 6/14;
  • 23282, PNC, CLR, Dunkirk 1-18H,
  • 23272, conf, CLR, Caretan 1-28H,
  • 23271, conf, CLR, Yvette 1-4H,
  • 22951, 519, CLR, Obriyenitch 1-14H, t11/12; cum 112K 6/14;
  • 22936, loc, OXY, Federal Polly Sivak 1-19-18H-143-98, Whitetail oil field;
  • 22276, 427, CLR, Epsom 1-31H, t5/12; cum 108K 6/14;
  • 22277, 118, CLR, Elizabeth Ann 1-32H, t7/12; cum 60K 6/14;
  • 22327, 184, CLR, Natalie 2-2H, t7/12; cum 79K 6/14;
  • 22383, 265, CLR, Odessa1-17H, t7/12; cum 58K 6/14;
  • 22408, 113, CLR, Proch 1-7H, t9/12; cum 54K 6/14;
  • 22749, 575, CLR, Repetowski 1-36H, t8/12; cum 132K 6/14;
  • 22909, 703, CLR, Charnwood 1-32H, t9/12; cum 98K 6/14;
  • 22936, loc, OXY USA, Federal Polly Siva 1-19-18H-143-98, Whitetail oil field;
  • 22951, 519, CLR, Obriyenitch 1-14H, t11/12; cum 112K 6/14;
Issued in 2011
  • 21599, 545, CLR, Stuss 1-26H, t4/12; cum 106K 6/14;
  • 21690, 607, CLR, Wanner 1-15h, t6/12; cum 85K 6/14;
  • 21806, 854, CLR, Burian 1-27H, t3/12; cum 190K 6/14;
  • 21859, 85, CLR, Skurupey 1-9H, Saddle Butte oil field,
  • 21947, 161/576, Thunderbird Resources LP/GMXR, Fairfield State 21-16-1HRE, a Three Forks, well, 37 stages; 1.2 million lbs sand; re-entered late 2012/early 2013; March, 2014: principal name change from GMXR to Thunderbird Resources LP; t9/12; t1/14; cum 20K 6/14; see first comment below
  • 22046, 501, CLR, Jennie 1-8H, t3/12; cum 102K 6/14;
Issued in 2010
  • None
Of Interest, issued before 2010:
  • 15789, 376, XTO, Paluck 41X-28; t8/05; cum 131K 6/14; two laterals; if fracked, I did not see the data;
  • 15928, 483, XTO, Anheluk 44X-23; t1/06; cum 88K 6/14;
  • 16100, 255, CLR, Xavier 1-10H, t5/06; cum 105K 6/14; if fracked, I did not see the data;
  • 16153, 488, XTO, Krushevsky Logosz 41X-35; t9/06; cum 126K 6/14;
  • 16343, 180, CLR, Urban 1-12H, Kessel 1-12H; t5/07; cum 34K 6/14; if fracked, I did not see the data; the Tyler was noted to have "no good show";
  • 16479, 171, CLR, Dahle 1-2H, t7/07; cum 62K 6/14;
  • 16664, 485, XTO, Basaraba 44X-27, t12/07; 255K 6/14; if fracked, I did not see the data; there was one comment early on: "not yet frac'd"
  • 17172, 149, XTO, Jilek 44X-33, t12/8; cum 43K 6/14;
  • 17511, 262, XTO, Logosz 44X-22, t3/09; cum 28K 6/14;
  • 17768, 594, XTO, Chruszch 43X-29F, t7/12; cum 26K 6/14;
  • 17737, 256, CLR, Armstrong 1-24H, t4/09; cum 64K 6/14;
I'm learning as I go along (that's why some well-seasoned oil folks say that what I post in comments/interpretations is "nonsense").  Be that as it may, there is a great graphic in one of the XTO file reports. I'm sure these visuals have always been there but in light of the reasons Slawson/Lower Bakken Shale story, this one jumped out at me: the well bore going through the upper Bakken dolomite, below the lower Bakken shale.


From wiki:
St Demetrius came to be revered as one of the most important Orthodox military saints, often paired with Saint George. St Demetrius is particularly important for those of Russian Orthodox heritage, as well as among Christian Lebanese.
I have blogged a fair number of times on the Syrian-Lebanese in North Dakota, including back in January, 2011.

Chesapeake Earmarks 90% of CAPEX to Oil -- Rigzone

Link here.
Chesapeake Energy Corp. Tuesday said it stands by its plan to expand its oil production, saying it will spend nearly all of its 2013 capital budget on drilling in oil fields.

Chesapeake, the biggest natural-gas production company behind Exxon Mobil Corp....

About 40% of Chesapeake's planned $7 billion capital budget in 2013 is earmarked for drilling in the liquids-rich Eagle Ford shale formation in South Texas, Mobley said.
There was no mention of the Bakken in this very short press release, unless there was more to the press release and I missed it. 

Key Energy To Build Complex in Williston Area -- The Heart of the Bakken

Link here.  Minimal information, advertising site, but it's a start.

$5 million project; 46,000 square feet; three buildings, metal.

Key Energy Services has a market cap of $1.55 billion.

Folks, some folks feel we are well into this boom -- five years in the North Dakota Bakken boom -- and many folks, including me, thought we would start to see some leveling off of new building activity by now.

[Note: a definitional comment -- we are early in the boom with regard to drilling and production. We are in the first inning; drilling will go on for 20 years in the Bakken, and will produce through 2100. That's just the Bakken pool. However, as booms go, some would consider at five years into a boom we should start seeing signs of maturation with regard to building. That's the paradox of the Bakken at this point in time. I suppose another way of looking at this: the pace of drilling and/or production is currently at a steady, but almost predictable pace. Building activity, infrastructure CAPEX appears to be increasing suggesting several things.]

If the "old" estimates were accepted by the oil companies and the oil service companies I would expect that most building would have been completed by now. When I see companies like Key Energy now joining the others by building a $5 million complex, it supports my view that original estimates of OOIP were too low, and that original estimates of percent recovery, were also too low. 

Huge Margins Ethane to Ethylene -- RBN Energy

Link here.

Wednesday Morning Ramblings -- Absolutely Nothing To Do With The Bakken -- Much Political -- Read At Own Risk

1.  Note: I wrote the following note yesterday (Tuesday) evening. It is interesting that this is the discussion on CNBC this morning: whether making money is bad.

CNBC had an interesting talking head guest on an 4:30 p.m. yesterday afternoon. Martin Feldstein (Harvard, American economist, chief economic advisor to Ronald Reagan) said something that suggested one of the paradigm shifts in American thinking will be this: making money is bad.

His comments were based on a recent Obama speech. I think folks forget that presidents are change agents. I had not come across  the term "change agent" until the last seven or eight years in the Air Force when I first understood that general officers/flag officers were change agents. This may be a good starting point to understand the definition or meaning of "change agent":

Right, wrong, or indifferent, whether or not his policies stand the test of time, President Obama has changed the conversation. Parts of ObamaCare may be struck down by the Supreme Court, but already even those folks who were once adamantly opposed to ObamaCare are now talking about keeping the "better" parts of the Affordable Care Act. President Obama changed the conversation: not whether US medicine should be socialized or not, but how to do it. That's a huge step. I am not offering any opinion here on ObamaCare; I think folks would be surprised how I feel, though I have expressed my feelings in the past. For this post, I am simply stating, right, wrong, or indifferent, the president has changed the conversation regarding US health care.

Anyone who has followed this blog knows that I feel that President Obama has changed the conversation regarding energy. It is no longer about whether we move from fossil fuel to renewable energy, but how we do it.

On social issues such as same sex marriage he has changed the conversation. Pundits now talk as if it's a given, again just a matter of how we get there from here. Good, bad, indifferent -- again, I'm not offering any opinion -- I'm just noting that he has changed the conversation. 

I think that the most observant readers of the president's speeches and actions during the past several years have recognized that he was changing the conversation regarding wealth. Martin Feldstein articulated it as well as anyone in a 30-second soundbite. President Obama, good, bad, or indifferent, has changed the conversation regarding a corporation's responsibility to maximize profits for its shareholders. Folks in his own party are now taking sides on whether private equity is good or bad. Interesting.

2. Drudge Report links a story suggesting that the state of Hawaii has provided information requested by state of Arizona. No details; apparently it's still a secret to be kept from the rest of us. Update at Drudge: Arizona will place Obama on the ballot; has birth certificate. Whew!

3. Speaking of politics: Kentucky and Arkansas --
President Barack Obama continued to have trouble on Tuesday performing in Democratic primaries in traditionally conservative states, barely eking out wins in Kentucky and Arkansas.

The president didn’t even have an opponent in Kentucky, but with 99 percent of the vote counted, Obama took just 57.9 percent of the vote, with the remaining more than 42 percent of ballots cast for “uncommitted.”

In Arkansas, with 70 percent of the vote tallied, Obama nabbed just 59 percent of the vote. His opponent there, John Wolfe, was able to take 41 percent of the vote at that point, according to The Associated Press.
And in Florida, Romney by 6.

4. You will see headlines that new home sales were up a strong 3 percent month-over-month at 343,000 new home sales in April. CNBC's Santelli (one of my favorite "analysts") put this in perspective by noting that the recent "high-water" mark for home sales was 350,000 in February, 2012. I have trouble reconciling this as good news, but we will see how the mainstream media reports it.  This story does not mention the "high water" mark set in February, but says this:
Still, sales of new homes are well below the 700,000 annual sales that economists equate with healthy markets.
So, a new number (700,000) along with 200,000 and 400,000 for following the economy. 

5. Interesting.  [Later: Wednesday morning, this was a Drudge link; Wednesday evening, this was the top story, the #1 story at Yahoo!News.]

6. Is Germany driving the bus, or will French Hollande take over? If Euro breaks below $1.26, watch out for free fall.