Monday, November 12, 2012

Hofmeister: $5.00 Gasoline; Not So Wrong

Link here to Orlando Sentinel.
A Shell station in the tourist area near Lake Buena Vista was selling gasoline for $6.44 a gallon Monday — more than $3 above what most motorists are paying.

A clerk at the station at 8788 Vineland Ave. declined to comment. The manager could not be reached.
And so it goes. 

The End of Any Economic Development on Sixth Largest Reservation in the United States: Standing Rock Reservation

Link here to Casper, Wyoming Star Tribune.
A Columbus, Neb., biologist might have discovered the first wild colony of an endangered species since the Meeteetse find in 1981.
Mike Gutzmer, with Columbus-based New Century Environmental LLC, found three black-footed ferrets during an endangered species survey in South Dakota.
The black-footed ferret is the most endangered mammal in America and has been on the endangered species list since 1967.
It has been more than 30 years since the black-footed ferret was found in the wild in Meeteetse. There have been several populations of the animal reintroduced by scientists over the years in eight states.
The black-footed ferret used to number in the tens of thousands, but because of habitat loss and disease, the animal faced extinction. It was presumed extinct in the wild in 1987. About 1,000 of the ferrets are recorded today, with 750 living in the wild and another 250 in captivity.
The black-footed ferret is the only ferret species native to the Americas. They are part of the weasel family and are yellow, buff or white with a black “mask” across the eyes. They weigh between 1.4 to 2.5 pounds and measure 19 to 24 inches in length.
The discovery of the wild colony on the Standing Rock Indian Reservation is like “finding a needle in a haystack,” Gutzmer said.
The Standing Rock Reservation is outside the Bakken. 

On Tap for Tuesday: Wells Coming Off the Confidential List; KOG Has A Huge Well; Triangle Has A Nice Well

Active rigs: 191 (steady)

Wells coming off the confidential list the last few days (long Veterans Day weekend, a day Google remembered with Rodin's The Thinker)

20788, 254, Whiting, Zalesky 34-8PH, North Creek, Stark, t5/12; cum 11K 9/12
21957, drl, BEXP, Cvancara 20-17 4TFH, Alger, Mountrail,
22539, 502, Hess, GO-Qvale Trust 158-97-3229H-1, New Home, Williams, t8/12; cum 17K 9/12
22577, drl, BEXP, Gunderson 15-22 4H, Banks, McKenzie, [see the Gunderson wells here]

20095, 1,097, XTO, Wagern 24X-23B, Midway, Williams, t7/12; cum 17K 9/12
20859, 196, Petro-Hunt, Carlson 159-94-4B-9-1H, North Tioga, Burke, t8/12; cum 6K 9/12;
21632, 1,686, Triangle, Larson 149-100-9-4-1H, Ellsworth, McKenzie, t5/12; cum 33K 9/12;
22695, drl, BEXP, Ross-Alger 6-7 4TFH, Alger, Mountrail,
22733, drl, CLR, Glasoe 5-19H, Dolphin, Divide,
22785, 810, MRO, Thomas Miller USA 21-28H, Deep Water Creek Bay,  McLean, t8/12; cum 12K 9/12;
22788, drl, Crescent Point, CPEUSC Szarka 25-36-159N-100W, Wildcat, Williams,

21099, 825, Zenergy, Rella 17-20H/Heen 17-20H, Lake Trenton, Williams, t7/12; cum 25K 9/12;
21444, 141, Samson Resources, Camino 5-9-163-98H, Candak, Divide, t8/12; cum 6K9/12;
21793, 56 (no typo), Hunt, Horst 2-25H, Parshall, Mountrail, t8/12; cum 25K 9/12; 14 stages; 1.3 million lbs proppant;
22271, 616, OXY USA, State Caly 1-26-23H-142-97, Willmen, Dunn, t5/12; cum 44K 9/12;
22578, drl, BEXP, Gunderson 15-22 3TFH, Banks, McKenzie, [see the Gunderson wells here]
22620, drl, CLR, Thronson 2028AH, Alkali Creek, Mountrail,
22823, 963, G3 Operating, Berg 1-20-17H, Good Luck, Williams, t8/12; cum 9K 9/12;

20483, 1,562, XTO, FBIR Georgeblackhawk 21X-6B, Heart Butte, Dunn, t7/12; cum 23K 9/12;
20515, 2,462, KOG/BTA, P Alice 154-99-4-3-27-4H, Epping, Williams, t8/12; cum 38K 9/12;
20912, 653, Whiting, Duletski 11-16TFH, Gaylord, Stark, t5/12; cum 19K 9/12;
21612, 35 (no typo), MRO, Hoff 24-19H, Strandahl, Williams, t8/12; cum 522 bbls 9/12; 30 stages; 2.6 million lbs proppant;
21947, 161, GMX Resources, Fairfield State 21-16-1H, St Demetrius, Billings, t9/12; cum 1K 9/12;
22356, 207, Hess, GO-Anderson 157-97-36H-1, Ray, Williams, t7/12; cum 6K 9/12;
22510, 264, Hess, EN-Hanson-156-94-3031H-3, Manitou, Mountrail; t8/12; cum 8K 9/12;
22735, drl, CLR, Glasoe 7-19H, Dolphin, Divide,

From Forbes: Natural Gas Production Not Likely To Decrease Next Four Years

Link here to Forbes.
.... a key element of both the Romney and Obama energy platforms: increased domestic natural gas production.  It is generally expected that the Obama administration will continue to push for more oversight and regulation of shale fracking. 
The April 2012 EPA decision to reduce air emissions from fracking could well be followed by an effort to end exemptions from certain elements of the Safe Drinking Water Act.  In the case of the EPA air emissions oversight, the rules were relaxed somewhat, and industry was given two years to bring activities into compliance.
In the case of water regulation, the conversation may well continue to drag along slowly for some time to come.  In the end, there is only so much regulation that is likely to occur at the national level.  The 2005 Energy Policy Act essentially gave most regulatory responsibility to individual states, and it will probably remain there.
Regardless of the final regulatory outcome, gas production is likely to soar, especially as gas use grows in transportation, industry, and electric generation.  And don’t forget the significant potential for LNG exports, as numerous license requests have already been tendered.  
The Marcellus area, and Pennsylvania in particular, should continue to see rapid growth. 
A new study from ASD Reports announced today suggests that production could increase more than seven-fold from 2011 levels, from  just over 1,000 billion cubic feet equivalent (bcfe) in 2011 to almost 5,000 bcfe in 2015, before finally leveling off at over 7,600 bcfe in 2020.
I'll be sleeping better tonight. 

Coal Story: Nothing To Do With The Bakken

For archival purposes only: proposed railway in eastern Montana waiting for federal review/approval. Only 83 miles long; from the Billings Gazette.

First, the article today: Montana coal railroad faces federal review

And, then the article in October, 2012: Federal approval sought for Tongue River Railroad
Eastern Montana residents will weigh in this week on a proposed 83-mile coal railroad with the potential to usher in a dramatic expansion of mining in the state and increase exports of the fuel to Asia.
The Surface Transportation Board is hosting a series of public meetings beginning Monday in Lame Deer for its environmental review of the proposed Tongue River Railroad.
The $490 million line from Miles City to south of Ashland would haul up to 20 million tons of fuel annually. That's equal to about half the state's current coal production.
The long-stalled railroad was bought last year by BNSF Railway, Arch Coal and billionaire Forrest Mars Jr., following decades of delays due to court challenges and financing hurdles.
And so it goes. 

Two Great Crude-By-Rail Articles From a Reader; Canadia Oil Sands

Two great articles on crude-by-rail, sent by a reader.

First: Southern Pacific Resource Corp will open a dedicated rail terminal in a few weeks, to ship oil to the US, bypassing Cushing --
In a market where heavy crude sells at a huge discount and pipeline space is at a premium, one oilsands producer has found a way around the bottleneck.
Southern Pacific Resource Corp., which began trucking out initial production from its new McKay Thermal Project three weeks ago, will open a dedicated rail terminal in a few weeks just south of Fort McMurray and ship its product in leased tanker cars via CN Rail all the way to Natchez, Miss.
From there, it's just a short barge ride down the Mississippi River to one of the eight refineries in Louisiana, where the crude will fetch $20 to $30 a barrel more than it could at the congested terminal hub in Cushing, OK.
And, second: this story is much of the same, but there are some data points of interest.

The comments are particularly interesting. The faux environmentalists have helped the crude-by-rail industry beyond expectations.

Bakken Could Produce 4 Million Bbls of Oil by 2025

Link here to the MDU presentation, a PDF file.  Look at slide 15. Some suggest the Bakken could produce four (4) million bbls per day by 2025.


Cape Cod, November, 2012

Economics Trumps Ideology

Europe backs away from carbon tax on airlines to non-EU countries.

The fact that the US was balking was bad enough, but this was the straw that broke the proverbial camel's back:
Beijing suspended a plan for Chinese airlines to buy dozens of Airbus aircraft, according to Airbus, a unit of European Aeronautic Defence & Space Co. NV. Russia, meanwhile, withheld new "free of charge" rights for EU-based airlines to fly over Siberia, according to some EU airlines.
And for those who may have forgotten, Canada has withdrawn from the Kyoto Protocol

With the oceans rising 3.3 mm/year .... yes "point.3" ....

Economic Development in North Dakota In General, Grand Forks In This Story: Bed Covers for Pick-Up Trucks

Link here to Prairie Business.
Grand Forks-firm Applied Products has been growing by adding market share, creating new distribution networks and raising the profile of its Retrax brand of bed covers. This year, the company’s sales are up 25 percent to 30 percent over last year, Fargo said. It has added more than 20 employees over the last two years and is looking for four or five more.

The company fits into a pattern among companies economic development officials say is more typical of the region than is often recognized.
According to the Grand Forks Region Economic Development Corp., 43 companies in the area reported a net gain since 2005 of 971 jobs and an increase of $16,186 in average annual wages, or $11,093 after adjusting for inflation.

Antarctic Ice Growing at Record Pace; 1.5 Million New Species of Oceanic Phytoplankton

Link to WSJ at winds drive growth in Antarctic sea ice.
Northward winds are driving the record growth of winter sea ice around Antarctica, which stands in contrast to the extensive melting of the Arctic sea ice in recent years, scientists reported Sunday. 
Their new research, based on 19 years of daily ice-motion measurements recorded by four satellites of the U.S. Defense Meteorological Satellite Program, highlights how geography, weather and climate patterns are affecting the planet's polar regions in different ways.
Their analysis documented for the first time that long-term changes in the drift of annual sea ice around Antarctica were strongly affected by winds. The area of ocean covered by sea ice grew markedly in regions where the prevailing winds spread out the loosely compacted ice floes, they reported. It shrank in areas where the wind blew the floating ice up against the shore.
This has been previously reported and is well known among folks who are open to continuing scientific dialogue on global warming.

The "19 years of daily ice-motion measurements" is interesting. This number of years corresponds very closely to when global warming appeared to end, 16 years ago

Winds, by the way, are also explaining a lot of other climatic/weather phenomena related to European glacier activity.

I believe it was CRC, but I could be wrong, who noted that with Arctic ice shrinking, and Antarctic ice growing, there is a risk that the earth could tip over.


Other ocean notes:

This is one of my favorite stories: 1.5 million new species of phytoplankton during "heath check" of the earth's oceans. It's an incredible story. 1.5 million new species. Also here. But wow, we need to clean up that plastic. Biodegradable plastic is where we need to put research dollars.

Current book reading: The Whale: In Search of The Giants of the Sea, Philip Hoare, c. 2008/2010 (The Leviathan in Great Britain).  I am currently in my "ocean phase of reading." Maybe more on that later.

Miscellaneous Links: US To Surpass Saudi in Oil Production by 2017; Surpass Russia By Sizeable Margin by 2015

The fracker's guide to a greener world.
Greenhouse-gas emissions are growing rapidly in the developing world. The only realistic alernative to this trend is natural gas. 

Denmark scraps 'fat tax' after a year.
Danish lawmakers have killed a controversial "fat tax" one year after its implementation, after finding its negative effect on the economy and the strain it has put on small businesses far outweigh the health benefits. 
Yup. Sort of like New York City's plan to ban 32-oz big gulp drinks....and forgetting about preparing for global warming ocean surges. Twenty years to prepare.

EPA: Sandy stirs toxic-site worry -- of 198 Superfund sites across the nation, 45 of them are within a half-mile of coastal areas vulnerable to storm surge. This puts the Bakken and fracking into perspective. New York and New Jersey had 20 years to prepare for Sandy.

Non-energy: FBI scrutinized on Petraeus. On page A4 there is a short timeline on Paula Kranz Broadwell, a Bismarck, ND, Century High School valedictorian, I believe. There are a lot of stories on Petraeus, and more to come, but this is one of the best articles to date.

RBN Energy: a look at the China shale oil industry explains a lot about the development of US shale oil -- it's another great article; highly recommend;

Abaxas to sell 544 net acres in Eagle Ford for $20 million to a "large institutional buyer." Is Warren an institution? The divestiture includes about 60 barrels of oil equivalent/day (mostly wet and dry natural gas; very little oil. I did the math ($20 million/544 net acres; my calculator must be broken.)

Staggering: US to overtake Saudi as top oil producer by 2017, according to IEA. 
The International Energy Agency (IEA), which advises major industrialized nations on energy policies, gave the estimates in an annual long-term report. Its conclusions were in sharp contrast with its 2011 report, which saw Saudi Arabia remaining the top producer throughout 2035.
"Energy developments in the United States are profound and their effect will be felt well beyond North America—and the energy sector," the IEA said.
MDW comment: 
I remember all those articles back in 2006 - 2008 suggesting the Bakken was all hype.  For newbies, see if you can find an oil field with one trillion bbls of original OIL in place (OOIP), a recovery rate of eight percent, and "no" dry wells. If it will help, google "Bakken trillion ooip."

By the way, this guarantees federal fracking regulations. This has nothing to do with "destroying the domestic oil industry." It is simply about a) money, and b) power. There is no way Washington is going to ignore that much money and there is no way Washington is going to let oil industry call the shots.
And more from that IEA report:
IEA Chief Economist Fatih Birol told a news conference in London he believed the United States would overtake Russia as the biggest gas producer by a significant margin by 2015. Shortly after that, by 2017, the United States would become the largest oil producer, he said.
Economic development in Dickinson:
Zoning process continues on new truck stop. The story does not point out that the location is near where the MDU/Calumet refinery will be sited.  From the linked article:
  • A 116-acre property between Dickinson and South Heart in western North Dakota moved a step closer to becoming home to a truck stop and retail businesses Tuesday.
  • The property lies near Highway 10 and 116th Avenue Southwest.
  • “My clients do not anticipate building anything within the next year because they are in New York and are dealing with Hurricane Sandy,” she told the commissioners. “As far as immediate plans to build, they have none. We’re just in the process of getting that ball rolling. It’s a preliminary step to get it going.”
Clearing out my inbox; a random note from Don regarding Bakken natural gas.
KOG reports it flared 881,906 MCF of NG in the 3rd qtr of 2012.  This is 9,585 mcf per day. This amount of NG is from one small player, and when all the wells get hooked up, the NG from ND could replace the NG that was supposed to come to America from Canada/Alaska about 10 yrs ago.
One day's worth of KOG flared gas (noted above) could heat 700 homes in a North Dakota winter.
For newbies, dry natural gas represents about 3 percent of total Bakken oil and gas economic potential according to reports out of the Bakken several years ago. I don't know how accurate that number was/is (then or now) but it points out that the Bakken is an oily play, not a gassy play, but that doesn't mean natural gas is not insignificant.
Apple: I don't invest in shares of Apple but it is my favorite company to follow.
My regular Starbucks is closed today for renovation (hopefully more electric outlets and perhaps wireless charging stations), so I bicycled aimlessly looking for another Starbucks. In a metropolitan area one does not have to bike aimlessly for very long. I found a Starbucks in Watertown, which actually, is a bit nicer than the one at Cushing Square, Belmont, but fewer seats. When I arrived, there were two elderly women, both with iPhones and both with iPads (the full-size version). One was teaching the other how to use her new iPad. Speaks volumes about the ubiquity of Apple products.