Thursday, December 27, 2012

Update On Availability of Water Necessary to Frack Wells in the Bakken

Metric: amount of water being released from the Garrison dam. Dynamic link.

News item: The US Army Corps of Engineers is looking at allowing 30,000 acre-feet of "surplus" Missouri water be used for fracking.

1.  Back in late 2011, it was estimated that approximately 6 acre-feet of water was used to frack a Bakken well.

In a more recent article the estimate was 1 million to 3.5 million gallons of water is used to frack a Bakken well (see paragraph 3 below). The conversion factor: a acre-foot = 325,851 gallons. Therefore 1 million to 3.5 million gallons converts to 3 acre-feet to 10 acre-feet.

Currently, it is estimated that about 2,000 wells will be fracked each year in the Bakken. That equates to somewhere between 6,000 acre-feet to 20,000 acre-feet of water being required to frack Bakken wells on an annual basis. Again, the USACE is looking at releasing 30,000 acre-feet of water.

2.  Maximum water storage of Lake Sakakawea is 23,800,000 acre-feet. 30,000 acre-feet represents 0.1% (one-tenth of one percent) of the volume of Lake Sakakawea. [Update: in the June 6, 2013, the NDIC stated that the amount of water needed to frack wells for two years in the Bakken equated to the top one inch of surface water in Lake Sakakawea. Bakken Activity Update, June 6, 2013, a PDF file.]

3. From the third link above:
Thanks to the Bakken shale, the state has become the country's second-biggest oil-producer practically overnight. And while the world still runs on oil, with the rise of hydraulic fracturing, or fracking, oil increasingly runs on water. Drillers inject 1 million to 3.5 million gallons of pressurized water into each well to shatter the rock and free the oil. More of the trucks you see are carrying water than anything else, some 400 to 800 truckloads per well.
4. My arithmetic might be off.

5. And, of course, the Missouri is not static. As water is removed for fracking (or for farming for that matter) it is being replaced by additional water flowing downriver.

Bottom line: there is more than enough water for fracking in the Bakken. The US Army Corps of Engineers calls is "surplus" water and says they are considering 30,000 acre-feet to be released for fracking. At the very least, this would be enough water to frack 3,000 wells/year in the Bakken, and currently, about 2,000 wells are being fracked annually.

Lake Sakakawea is probably not the only source of water for fracking in the Bakken. Recycling of water for fracking will also decrease the amount of water required.

Nine (9) New Permits -- The Williston Basin; Hess Has a Great Truax Well; CLR Has Two Nice Wells

Bakken Operations

Active rigs: 187 (steady)

Nine (9) new permits --
  • Operators: CLR (4), Petro-Hunt (2), OXY USA, Oasis, Corinthian
  • Fields:  Lindahl (Williams), Dublin (Williams), Northeast Landa (Bottineau), Bull Butte (Williams), Murphy Creek (Dunn), Little Knife (Dunn)
  • Comments: None
Wells coming off confidential list were reported earlier; see sidebar at the right.

  • 22378, PNC, Helis, G Levang 13-32/29H, McKenzie County
Wells coming off confidential list tomorrow, Friday:
  • 20316, 893, CLR, Kellogg Ranch 1-32H, Elidah, 28K in first full month of production; t9/12; cum 31K 10/12;
  • 21578, 470, Liberty Resources, Berger 156-101-9-4-1H, Tyrone, t7/12; cum 35K 10/12;
  • 22631, drl, BEXP, Marcia 3-10 3H, Last Chance,
  • 22755, 2,605, BR, Iron Horse 31-2MBH, Union Center, t10/12; cum --
  • 22773, 1,471, CLR, Jensen 2-8A, Chimney Butte, 50K first two full months of production; t9/12; cum 52K 10/12;
  • 22814, 2,365, BR, CCU Powell 229TFH, Corral Creek, t10/12; cum 3K 10/12;
  • 22861, 1,594, Denbury Onshore, Madson 11-33SH, Charlson, t9/12; cum 9K 10/12;
  • 22945, 1,066, Hess, SC-Norma-154-98-0706H-1, Truax, 34K first month of production; t10/12; cum 35K 10/12
  • 22970, drl, BR, CCU Golden Creek 33-23PH, Corral Creek,
  • 23049, drl, CLR, Chicago 4-26H, Banks,

EPA Head Announces Resignation


December 28, 2012: filling her shoes

Original Link

Link here to the biggest story of the day. I'm surprised it wasn't announced after the news cycle, Friday night, or maybe even New Year's Eve. Hillary. Leon. Lisa. Eric. Tim.

Bakken Links, Other Energy Links Sent in By Readers; A Must-Read NY Times Article

First, from "anon 1": another photo of the Bakken from space. This is one of the better photos: look how far east the flaring goes toward Minot. About halfway between Williston and Minot. And for all the attention Dickinson gets, not much there yet, relatively speaking.

Also, from "anon 1": a story of Bakken oil reaching a Canadian refinery by rail; 90,000 bopd to Irving Oil Corp's Saint John refinery. A great story/a great link. I would like to say more about it, but need to keep moving. Just the following in case the source archives the story at a later day:
Irving Oil Corp. is moving more than 90,000 barrels a day of crude from Alberta and North Dakota by rail to its Saint John refinery, Canada’s largest, and plans to increase those shipments, according to a person familiar with the plans.
Alberta crude is coming by rail directly to the Irving refinery rail terminal in New Brunswick and Bakken oil is moving by rail to a port in Albany, New York, then shipped by marine tanker to Saint John, said the person, who asked not to be identified because the closely held company’s transportation plans are private. 
High energy costs in Europe

Another frequent contributor sent this link, perhaps my favorite story of the day, so far. The reader notes: "I can't tell how much of the story is reporting and how much is the writer's opinion, but it does find fault with the EU's renewables subsidies." The article is from the NY Times, but reads as if it was published in the Wall Street Journal. It's an outstanding article and if I had to recommend just one story for the day this would be it.
High energy costs are emerging as an issue in Europe that is prompting debate, including questioning of the Continent’s clean energy initiatives. Over the past few years, Europe has spent tens of billions of euros in an effort to reduce carbon dioxide emissions. The bulk of the spending has gone into low-carbon energy sources like wind and solar power that have needed special tariffs or other subsidies to be commercially viable.
“We embarked on a big transition to a low-carbon economy without taking into account the cost and without factoring in the competitive impact,” says Fabien Roques, head of European power and carbon at the energy consulting firm IHS CERA in Paris. “I think there will be a critical review of some of these policies in the next few years.” 
Many, many story lines in that article. Quite incredible. Bottom line: wind and solar -- the math does not work. To see this article in the New York Times suggests the editors are willing to discuss the issue with a bit more balance. 

Local Stories

  • in the first 11 months of 2012, Dickinson issued permits for more than $300 million worth of construction in a city trying to catch up with the droves of people coming to the Oil Patch ...
  • the largest sector of growth was commercial structures, followed by single-family housing ...
  • Williston had the highest permit values of any North Dakota city, with more than $418 million worth of construction permitted as of Nov. 30, ...
Update on a pipeline connection between two pipeline companies. The two pipeline companies: Enbridge and High Prairie Pipeline, LLC. Interconnection: affects Bakken oil at/near Clearbrook, MN. It looks like Enbridge still holds the upper hand, although the tone of the article suggests this was a press release:
On May 18, the FERC denied High Prairie's protest, noting among other things that "it is not clear that Enbridge Energy has actually denied any request from High Prairie for an interconnection" and that "there is no statutory authority, or judicial or Commission precedent that gives the commission jurisdiction to compel Enbridge Energy to interconnect." We continue to believe High Prairie's additional claims are wholly without merit. Enbridge's response is on file with the FERC requesting that the commission dismiss this complaint just as it denied the earlier protest.
Enbridge has successfully worked with a number of third-party pipeline companies, including Saddle Butte Pipeline, LLC, a wholly owned subsidiary of High Prairie Pipelines, LLC, to provide pipeline connections and access to its North Dakota system where it is physically capable of receiving and transporting the crude without causing increased apportionment of its system. Enbridge is seeking a business solution to High Prairie's request and remains open to discussing those options. High Prairie has chosen not to engage in further discussions along those lines.
Lake Sakakawea is 'officially frozen.' As are ObamaCliff talks, apparently.

Thursday Morning Meanderings -- Mostly For The Archives

Good morning. I assume everyone is already up; I'm on the west coast and already three or four hours behind the rest of you.

Some free associating today; some Bakken, some not.

IPs for wells coming off the confidential list today have been posted. I am really impressed with KOG. They are tearing up the Heart Butte and Truax fields with some great wells. [Disclaimer: this is not an investment site; having said that, I own no KOG shares and don't plan to in the near future. By the way, for investors only, it appears there have been four "entry points" for KOG over the lifetime of the company: 60 cents; $6.00; $8.00; and, $10.00. Today, the shares are selling for about $8.65.]

NDIC still needs to fix their calendar over at their "Daily Activity Report Index." [It's been fixed.]

RBN Energy: second of a series of articles on the Louisiana Offshore Oil Port terminal, the LOOP.

There are three converging stories politically: a) the president has returned to Washington, DC; some saying his vacation was cut short, but who really knows; b) the ObamaCliff; and, c) Tim's debt ceiling. I was pretty sure the President was in control of the "cliff" (as in, winning the polls) and expected him to let us go over the cliff. So, his returning to Washington surprised me.

I think the bigger worry is the debt ceiling. Tim forecasts that we will hit the ceiling New Year's Eve. My hunch is that the debt ceiling story is the one that brought the President back to Washington. It was important politically that he be seen back at work as we go over the cliff (Santelli/CNBC suggested as much) but the debt ceiling is the real story over the next few days. As noted before, when we go over the cliff, the dates are all reset: the new date is December 31, 2013 -- pass a bill by then and "they" can make it retroactive to the first of the year.

The LA Times has a front page story today -- in fact, the lead story -- on Senate minority leader Mitch McConnell. There were many story lines, of course, but these two paragraphs caught my eye:
"The president made a strategic miscalculation and overreached," said one GOP aide granted anonymity to discuss party strategy. "He could have worked to reach a fair agreement, but instead he picked a fight, poisoned the well, and now we are likely to have a rather unproductive next four years. The decision he made only hurts himself."
There is little evidence to back up that belief. In a Gallup poll released Wednesday, for example, 54% of Americans responding said they approved of the way Obama had handled the negotiations and 45% said they approved of Democratic leaders in Congress. By contrast, 26% said they approved of Boehner and the Republican congressional leadership.
The Times writer seems to have moved from a news story into an op-ed when she drew that conclusion. The Gallup poll in the second paragraph has nothing to do with the news in the first paragraph. A few days ago I alluded to the tone of the President's reply to the GOP plan and/or to John Boehner's presentation, and this now appears to be the foundation for the news in the first paragraph above.

End of politics for a minute. Except to say, that the media appears to think the election is not over, still trying to score points for one side or the other. I'm not exactly sure what good it does to post polls on "who do you think is to blame for the fiscal cliff?" The voters voted. The election is over. Time for those in control to take control. I just saw a cute little puppy catch a rag that was attached to a wheel on a SUV. Not a pretty sight. Cue up Connie Stevens.

I see the headline: jobs claims drop is huge this past week. But did you notice the little gem at the bottom of the story? The Federal government and many state offices were closed when the data was being calculated. The unemployment numbers for 19 states are nothing but estimates.
President Barack Obama declared Monday a holiday for federal workers and many state offices followed suit and were unable to provide complete data for last week's jobless claims. Data for 19 states was estimated, a Labor Department official said.
Fourteen of those states, including Texas and California, submitted their own estimates, which tend to be fairly accurate because the state officials work with a significant amount of data, the Labor Department official said.
Sure. So, we'll post the numbers (350,000 last week; 365,750 four-week moving average) and see the revised numbers next week. Wanna bet they go up?

"Anon 1" sent in two nice comments, but they deserve stand-alone posts, so will post them later.