Thursday, February 28, 2013

California Will Raise Tax On Gasoline Just In Time For The July 4th Holiday

Cue up Connie Francis.

The photo says it all. $5 gasoline.

Connecting The Dots, UK-Style: UK's Energy Output Fell For the 11th Consecutive Year; Coal Use At Highest Level Since 1966; Environmentally-Friendly Natural Gas Use At Lowest Rate Since 1966; Not Enough Natural Gas; What's a Country To Do? And Now A Likely Recession


March 1, 2013: Less than 24 hours after posting the two stories below, a third connecting dot is reported by Reuters
The risk that Britain is entering its third recession in four years grew on Friday with figures showing that manufacturing shrank unexpectedly last month and mortgage approvals for home buyers dropped in January.
Gross domestic product fell at the end of last year, bringing Britain within sight of another recession and the latest data suggested the central bank may need to do yet more to revive the economy.
Original Post 

Despite all that oil in the North Sea, UK energy production continues to fall. UK energy production has fallen for eleven consecutive years, and the writer of the story below says the rate has slown down, to almost 11% --- that's huge -- UK production falls 11% in the past year, and that's "less bad" than the previous 11 UK returning to coal, as a result.

First this story, as reported by Rigzone:
UK energy production fell for the 11th consecutive year in 2012 ... though at a slower rate ...
Figures from the Department for Energy and Climate Change, released Thursday, showed primary energy production fell 10.7% on the year as maintenance activity and a long-term output decline led to sharp falls in output from the North Sea.
Production of crude oil fell by 14.3%, while natural gas output fell by 14.1%. Imports of both exceeded domestic production, although due to the country also exporting large quantities production of both exceeded net imports.
Coal accounted for 42.8% of electricity supplied in 2012 and natural gas accounted for 27.6%, respectively the fuels' highest and lowest shares of generation since 1996.
The U.K. government has said the country will need up to 30 new gas-fired power stations by 2030 to ensure future energy supplies and to replace old coal and nuclear plants due to close by the end of the decade.
So, UK energy production falls -- and quite significantly.  And look at that: coal use at highest rate since 1996, and natural gas at lowest rate since 1966....CO2...what Kyoto Protocol?...

...what's a country to do? Hmmm....let us think.... how about allowing fracking?  Then this story, after banning fracking not long ago, the UK has now okay'd it but...with guidelines, as reported in Rigzone, in the very same issue:
The guidelines set out that operators must publically disclose all chemical additives to fracturing fluids on a well by well basis, including regulatory authorisations, safety data and maximum concentrations and volumes. These disclosures meet or exceed all known standards in the shale gas industry.
The UK lifted its ban on shale gas drilling in December after the Chancellor of the Exchequer announced plans to better exploit the country’s gas resources. Exploratory fracking had been suspended in the UK since May 2011 after two small seismic tremors were detected near the country's only fracking operation in the Bowland Basin to the east of Blackpool in Lancashire, northern England.
By the way, in that first linked story about coal being the "new" fuel for the UK, there was no mention of the world's largest off-shore wind farm, the one in the mouth of the Thames River, the London Array. It started to produce electricity late last year, but apparently isn't doing much to offset need for coal. Developers have had to cut back on the number of turbines due to environmental concerns, but they will re-apply for original number of turbines. Having said all that, the UK says they hope to reduce the cost of off-shore wind by 40% -- they didn't say how much off-shore wind energy is, but it is up to three times more expensive than on-shore wind farms -- and if the goal is to reduce the cost by 40%, one can imagine how expensive it is. We'll probably know more a year from now. Stay tuned. In the meantime, cue up Connie Francis.


It's a stretch, I know, but UK's eleven years of decreasing energy output reminds me of that seven-year ache:

Seven-Year Ache, Rosanne Cash

[Speaking of seven-year aches, "they" say the Keystone has been delayed 5 years now. If approved this year, Nebraska says the pipeline still won't come on-line until 2015 -- another two years -- talk about a seven-year ache.]

Another LPG-Export Terminal

In the process of searching for something else, I ran across this, as reported by Argus Media.

Data points:
  • new LPG-export terminal; Beaumont, Texas; Japan + European joint venture
  • exports predominantly to Asia-Pacific
  • hinted at this project in 2011 due to glut of propane but didn't say anything until yesterday
  • Japan: 34% stake
  • first phase: $500 million; will include a 100,00 b/d de-ethanizer (strip ethane from propane)
  • to be completed by 4Q14
  • differential between US propane / Asian propane: $452/t
  • several other LPG-export facilities mentioned in the linked article
Note: the ethane will be stripped out, adding to even more ethane stateside. (Corrected: see comment from "anon 1.")

Look At Some Huge Wells; KOG and BR Each With a Huge Well; EOG With A Nice Bear Den Well; MRO With a Nice Well; Wells Coming Off the Confidential List Friday; Huge Wells Being Taken Off-Line Due to Excessive Flaring?

Less than 24 hours.

Newbies should check out the Iron Horse wells in the Union Center field; see below. 

Wells coming off the confidential list on Friday:
  • 21689, 1,665, EOG, Bear Den 104-2116H, Spotted Horn, t9/12; cum 76K 1/13;
  • 21716, 943, Petro-Hunt, Van hise GTrsut 153-95-28C-21-2H, Charlson, t12/12; cum 54K 1/13;
  • 22013, 360, Cornerstone Natural Resources, Jepsen 3-20-17H, Coteau, t11/12; cum 24K 1/13;
  • 22114, 1,712, MRO, Baker USA 11-18TFH, Van Hook, t10/12; cum 60K 1/13;
  • 22164, 693, Slawson, Athena 3-36H, Alger, t11/12; cum 13K 1/13;
  • 22197, 508, OXY USA, Griggs 2-8-9H-142-97, Willmen, t9/12; cum 21K 1/13;
  • 22448, 650, G3 Operating, C. Rasmussen 1-23-14H, Strandahl, t12/12; cum 8K 1/13;
  • 22685, 598, Hess, EN-Jeffrey -155-94-2215H-2, Alkali Creek, t2/13; cum 8K 1/13;
  • 22758, 2,485, BR, Iron Horse 11-2TFH, Union Center, t11/12; cum 6K 1/13;
  • 22850, 2,338, KOG, Koala 15-33-28-2H, t11/12; cum 64K 1/13;
  • 23009, 815, Hess, HA-Grimestad-152-95-3031H-2, Hawkeye, t11/12; cum 45K 1/13;
  • 23135, drl, BR, CCU Powell 11-29MBH, Corral Creek, no production data;
  • 23394, 1,170, XTO, FBIR Baker 34X-25A, Heart Butte, t1/13; cum --
  • 23397, 969, CLR, Collison 1-23H, Avoca, t12/12; cum 23K 1/13;
  • 23459, conf, Sinclair, Crosby Creek 2-5H, Little Knife,
  • 23532, drl, CLR, Lousiville 2-9H, Last Chance
I could be wrong, but if you look at the Bear Den wells in Spotted Horn oil field, it looks like natural gas takeaway is huge constraint in the field. Wells are hooked up to gas lines in many cases, but are still flaring natural gas. In addition, it looks like some huge wells have been taken off-line because they continue to flare gas after twelve months of production. Again, all I have to go by are the monthly production runs but that is what the data is telling me.  A huge "thank you" to an anonymous reader who provided the tip.


21689, conf, EOG, Bear Den 104-2116H, Spotted Horn

DateOil RunsMCF Sold

 21716, conf, Petro-Hunt, Van hise GTrsut 153-95-28C-21-2H; already on a gas line:

DateOil RunsMCF Sold

 22013, conf, Cornerstone Natural Resources, Jepsen 3-20-17H, Coteau; already on a gas line:

DateOil RunsMCF Sold

 22114, conf, MRO, Baker USA 11-18TFH, Van Hook

DateOil RunsMCF Sold

 22850, conf, KOG, Koala 15-33-28-2H; already on a gas line:

DateOil RunsMCF Sold

 23009, conf, Hess, HA-Grimestad-152-95-3031H-2, Hawkeye, on gas line:

DateOil RunsMCF Sold


Williston State College Makes History -- The Williston Wire

A national championship for Williston State College. National:
History was made Sunday afternoon in Rochester, N.Y. 
The Williston State College Tetons won the National Junior College Athletic Association hockey championship 3-2 over Monroe Community College.
The national championship is the first in school history.
No links; it is easy to subscribe to the Williston Wire

NOG: 4Q12 and Full Year

From Yahoo! In-Play:
Northern Oil & Gas beats by $0.07, misses on revs: Reports Q4 (Dec) earnings of $0.34 per share, $0.07 better than the Capital IQ Consensus Estimate of $0.27; revenues rose 202.9% year/year to $81.75 mln vs the $82.88 mln consensus. Q4 total production was ~1 mln Boe. Average daily production was 10,865 Boe. Average realized price per Boe was $84.74.
Press release
  • Annual production increased 95% over 2011 to 3,760,123 barrels of oil equivalent ("Boe"), or 10,274 average Boe per day
  • Total revenues, including the effects of derivatives, increased 109% over 2011 to $311.6  million
  • Net income increased 78% over 2011 to $72.3 million
  • Adjusted EBITDA increased 101% over 2011 to $225.3 million
  • Proved reserves increased 44% over 2011 to 67.6 million barrels of oil equivalent
  • Added 563 gross (48.3 net) wells to production bringing total producing wells to 1,227 gross (106.2 net)

Twelve (12) New Permits -- Williston Basin, North Dakota, USA

Active rigs: 184 (nice)

Twelve (12) new permits --
  • Operators: BEXP (6), Petro-Hunt (3), EOG, MRO, Hess
  • Fields: Nelson Bridge (McKenzie), Camp (McKenzie), Alexander (McKenzie), Parshall (Mountrail), Wolf Bay (Dunn), Big Gulch (Dunn)
  • Comments:
Wells coming off confidential list were posted earlier; see sidebar at the right.

Two producing wells were completed:
  • 22281, 373, Crescent Point, Walters 35-26-158N-101W, Little Muddy, a Bakken well; t10/12; cum 15K 1/13; 
  • 22617, 448, CLR, Sorenson 1-21AH, Alkali Creek, t2/13; cum --

Extraction Taxes -- State-by-State Comparisons

The Dickinson Press is reporting
A comparison of effective oil tax rates in fiscal year 2010 of the top eight oil-producing states in the U.S. found that North Dakota had the fourth-lowest rate. Here is the ranking of the rates, with the total taxable value of oil production in each state in parentheses.
1. California — 2.5 percent ($15.2 billion)
2. Oklahoma — 6.7 percent ($11.1 billion)
3. Texas — 7.9 percent ($49.4 billion)
4. N. Dakota — 9.8 percent ($6 billion)
5. Montana — 10.7 percent ($2 billion)
6. Louisiana — 10.9 percent ($8.6 billion)
7. Wyoming — 13 percent ($8.3 billion)
8. Alaska — 25.1 percent ($14 billion)
Source: Covenant Consulting Group study commissioned by the North Dakota Department of Commerce.
A comparison of effective oil tax rates in fiscal year 2010 of the top eight oil-producing states in the U.S. found that North Dakota had the fourth-lowest rate. Here is the ranking of the rates, with the total taxable value of oil production in each state in parentheses.
1. California — 2.5 percent ($15.2 billion)
2. Oklahoma — 6.7 percent ($11.1 billion)
3. Texas — 7.9 percent ($49.4 billion)
4. N. Dakota — 9.8 percent ($6 billion)
5. Montana — 10.7 percent ($2 billion)
6. Louisiana — 10.9 percent ($8.6 billion)
7. Wyoming — 13 percent ($8.3 billion)
8. Alaska — 25.1 percent ($14 billion)
Source: Covenant Consulting Group study commissioned by the North Dakota Department of Commerce
- See more at:
A comparison of effective oil tax rates in fiscal year 2010 of the top eight oil-producing states in the U.S. found that North Dakota had the fourth-lowest rate. Here is the ranking of the rates, with the total taxable value of oil production in each state in parentheses.
1. California — 2.5 percent ($15.2 billion)
2. Oklahoma — 6.7 percent ($11.1 billion)
3. Texas — 7.9 percent ($49.4 billion)
4. N. Dakota — 9.8 percent ($6 billion)
5. Montana — 10.7 percent ($2 billion)
6. Louisiana — 10.9 percent ($8.6 billion)
7. Wyoming — 13 percent ($8.3 billion)
8. Alaska — 25.1 percent ($14 billion)
Source: Covenant Consulting Group study commissioned by the North Dakota Department of Commerce
- See more at:

SandRidge 4Q12 And Full Year Earnings

Press release.

SandRidge Energy, Inc. today announced financial and operational results for the quarter and year ended December 31, 2012.

Fourth Quarter
  • Adjusted EBITDA of $318 million for fourth quarter 2012 compared to $175 million in fourth quarter 2011.
  • Operating cash flow of $259 million for fourth quarter 2012 compared to $154 million in fourth quarter 2011.
  • Net loss applicable to common stockholders of $302 million, or $0.63 per diluted share, for fourth quarter 2012 compared to net loss applicable to common stockholders of $389 million, or $0.97 per diluted share, in fourth quarter 2011.
  • Adjusted net income of $35.3 million, or $0.06 per diluted share, for fourth quarter 2012 compared to adjusted net income of $8.7 million, or $0.02 per diluted share, in fourth quarter 2011.
Full Year
  • Adjusted EBITDA of $1,070 million for 2012 compared to $654 million in 2011.
  • Operating cash flow of $915 million for 2012 compared to $542 million in 2011.
  • Net income available to common stockholders of $86 million, or $0.19 per diluted share, for 2012 compared to net income available to common stockholders of $52 million, or $0.13 per diluted share, in 2011.
  • Adjusted net income of $124.3 million, or $0.23 per diluted share, for 2012 compared to adjusted net income of $6.9 million, or $0.01 per diluted share, in 2011.

At Least We Now Know "Who" We Can Blame -- As Mr Bush Recedes Into the Background

One of the silver linings coming out of the sequestration: the federal government now has "something" to blame for their inefficiencies.

Administration says, starting tomorrow, federal energy permits will be delayed

"Oh, you haven't gotten your permit yet? It's because of the sequestration."

"Oh, you haven't gotten your permit yet? It's because of the sequestration."

"Oh, you haven't gotten your annual Social Security statement yet? It's because of the sequestration."

"Oh, you missed your flight because TSA is slow today? It's because of the sequestration."

"Oh, jobless rate went up? It's because of the sequestration."

"Oh, no Saturday mail delivery? It's because of the sequestration."

As we always said in the military: "Sounds like a personal problem."

Given an obstacle, the average soldier usually found workarounds.  Not administration department heads -- don't try do more with less; just fall back on, "it's because of the sequestration."

Connecting the Right-To-Work Dots

A big "thank you" to Don.

USA Today reported: Indiana becomes the "rust belt's" first right-to-work state. That was reported about .. oh, one month ago, February 2, 2013, to be exact.

Quick, fast forward to today, February 28, 2013, 11:15 am: Chrysler announced huge investment in north-central Indiana.
An automaker is investing hundreds of millions and adding well more than a thousand positions at transmission and metal casting plants in Indiana.

Thursday morning, Chrysler announced it is adding 1,250 jobs to increase production of fuel-efficient transmissions in north-central Indiana. It’s also investing $374 million in area plants.
Interesting to note that the second-linked story failed to at least think about connecting the dots. In less than a month. This is not rocket science.

Sequestration: What The Politicians Are Not Telling Us

Sequestration exemptions

  • Social security benefits (old-age, survivors, disability) and railroad retirement benefits
  • all programs administered by the VA and special benefits for certain WWII veterans
  • net interest
  • payments to individuals in the form of refundable tax credits
  • unobligated balances, carried over from prior years, for nondefense programs
  • at the president's discretion: military personnel accounts may be exempt entirely, or a lower sequestration percentage may apply
The actual list of exemptions is too long for the executive summary, but includes:
  • activities resulting from private donations, bequests of voluntary contributions
  • advances to the unemployment trust fund
  • payments to various retirement, health are, and disability trust funds
  • certain Tribal and Indian trust accounts
  • medical facilities guaranty and loan fund
  • specified federal retirement and disability accounts and activities
  • prior legal obligations
  • low-income programs, including Child Care and Development Fund; Child Nutrition Programs; Children's Health Insurance Program; Commodity Supplemental Food Program; Temporary Assistance for Needy Families; Family Support Programs; Federal Pell Grants; Medicaid; Foster Care and Permanency Programs; Supplemental Security Insurance
  • Medicare Part D low-income premium and cost-sharing subsidies
To see the entire list (too long for the executive summary), the author of this document refers the reader to the "statute" itself. US Congresswoman Maxine Waters probably has a copy available upon request.

In addition to this list that is too long to even include in the executive summary, there is an additional list of budget line items are are protected by special rules.

Bottom line: the safety net for children and other social safety nets remain in place. When Congress passed the law, following the president's suggestion of a sequestration, it was done coolly, calmly, and collectively.

At the end of the day, the sequestration is pretty much all about jobs within the Beltway. 

Nice Two-Part Article on Process of Land Reclamation in North Dakota

The Dickinson Press is reporting.

Part I appears today

Timely: Microseismic and Data Suites Favor Large Integrated Services Companies


Later, 3:17 pm: this is truly coincidental. See original post. Now, this, just noted now, at Yahoo! In-Play:
Acorn Energy's US Seismic Systems secures order for their Ultra High Sensitivity fiber optic sensing system from a 'supermajor' oil co; terms of the sale are confidential.
Original Post

In the past five days or so, regular readers will note a theme running through the blog: it began with the Acorn Energy corporate presentation. Since that original note, there have been a couple more notes regarding the same issue.

Now today, the Wall Street Transcript covers this issue in a long interview. I don't subscribe so I cannot provide any detail, but the lede is enough to suggest some rabbit trails to follow.

The headline:  
Fractioning Optimization Using Microseismic and Data Suites Causing Shifts in Oil Services Market Toward Large Integrated Services Companies 
The lede:
The Wall Street Transcript has just published its Oil & Gas: Drilling Equipment and Services Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. 
Topics covered: Capital Expenditures and Consolidation Activity - Frontier Exploration and Development - Shale Drilling Capital Expenditures - Oil Price Expectations - Shale Drilling Dynamics - Shale, Offshore and Deepwater Drilling - Oil and Gas Price Divergence - Offshore Deepwater Oil Discoveries Companies include: Halliburton Company, Schlumberger Limited, Baker Hughes Inc., Weatherford International Ltd., National Oilwell Varco, Incorp, FMC Technologies, Inc., Cameron International Corporation, Oceaneering International, Inc, Noble Corp., Ensco International Inc., Rowan Companies Inc., and many more.
Disclaimer: I am not posting this for investors. Having said that, this is not an investment site. Do not make any investment decisions based on what you read at this blog.

I am posting this because of recent stories regarding better microseismic technology which should improve production. If it is accurate that "frack failure" is due to poor understanding of subsurface geology almost 75% of the time, it only makes sense to try to do better.

The companies in bold above have major operations in Williston and the Bakken in general.

Time For a New Poll -- Non-Bakken Related

Results of the current poll asking the question, which operator has the "big" well northwest of Watford City?
  • Newfield: 27%
  • Slawson: 17%
  • SM Energy: 14%
  • Other: 43% 
Rounding results in 101%.


Now the new poll. According to a CNBC crawler, the president has until 11:59 pm Friday night to sign the sequester bill. Essentially, by midnight tomorrow night.

The poll question:

Will the president sign the sequester order before midnight tomorrow, Friday, March 1, 2013?

[Later, 1:01 pm: CNBC video with Congress adjourning for the weekend and heading home.]

Front Page Story in The Wall Street Journal Today

I can't remember what I've posted, what I've written in e-mail to others, and what I've put in draft and not posted, but this front page story in today's WSJ is stunning confirmation: natural gas boom is projected to grow for decades.

The most important word in that sentence: "grow," as in "accelerate." That's an important distinction, by the way. "Grow" could simply mean continued "growth" on the same trajectory. The story actually uses the word "accelerate." To accelerate means to grow MORE than current rate of growth.

Second most important word in that sentence: "decades." The acceleration will continue over the next three decades. Here's the lede:
U.S. natural-gas production will accelerate over the next three decades, new research indicates, providing the strongest evidence yet that the energy boom remaking America will last for a generation.
The most exhaustive study to date of a key natural-gas field in Texas, combined with related research under way elsewhere, shows that U.S. shale-rock formations will provide a growing source of moderately priced natural gas through 2040, and decline only slowly after that. A report on the Texas field, to be released Thursday, was reviewed by The Wall Street Journal.
As the Journal notes, that growth will be generational.

Halcon Reports; RBN Energy; WSJ Links; How Serious Is The President About Working The Issue? A 7-Minute Photo-Op

The first face-to-face meeting between the president and Congressional leaders to discuss the sequestration is scheduled for Friday: a) hours before the deadline; b) again, the first meeting between the two on this subject; and, c) schedule time: 7 minutes -- three minutes to file in; 1 minute for photos; three minutes to file out. A reminder: this is playing out as expected when the president first suggested a sequestration some months ago. [Later, 1:01 pm: CNBC video with Congress adjourning for the weekend and heading home. It looks like they are not even waiting around for the meeting scheduled tomorrow.  CNBC says the next deadline is "government shutdown, a week and a half from today."]

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here.

WPX reports: Yahoo! In-Play: WPX Energy misses by $0.11, misses on revs: Reports Q4 (Dec) loss of $0.20 per share, excluding non-recurring items, $0.11 worse than the Capital IQ Consensus Estimate of ($0.09); revenues fell 8.0% year/year to $572 mln vs the $634.69 mln consensus. Press release here

Halcon reports: Yahoo! In-Play: Halcon Resources reports EPS in-line, beats on revs : Reports Q4 (Dec) earnings of $0.02 per share, excluding non-recurring items, in-line with the Capital IQ Consensus Estimate consensus of $0.02; revenues rose 387.1% year/year to $124.7 mln vs the $114.09 mln consensus.


Wells coming off the confidential list have been posted (only two, and one was put on DRL status).

RBN Energy talks about the natural gas situation, the pipelines, Canada and the US in the northeast.

WSJ Links

Section D (Personal Journal):

Section C (Money & Investing):
Section B (Marketplace):
Section A:
  • The sequester: identical to "going over the fiscal cliff"; go over the "sequester cliff" and then, get serious: both sides bet they'll have a stronger hand after deadline expires; this should catch one's attention: "The first face-to-face meeting on the issue between President Barack Obama and congressional leaders won't happen until Friday—the deadline for Mr. Obama to set in motion $85 billion in broad spending cuts." Question: why couldn't the president simply ignore the law on this one; plenty of other laws of much more importance have been ignored; I wonder what FDR or Reagan would have done?
  • Gas boom projected to grow for decades. More discussion here.
  • Quietly, SecTreasury confirmed; no links; story everywhere.
  • State gun laws being passed faster than ever; no links; stories everywhere.

Wednesday, February 27, 2013

Well Density in the Bakken; Horizontal Patterns in the Bakken; QEP Looking At Interference

Wall Street Cheat Sheet is reporting, excerpts from QEP earnings call, on cost:
Howard Weil: Couple questions on the Bakken, Chuck I think you talked about getting to $11 million or potentially below. Can you talk about where you are seeing the cost trends and kind of what’s the major effect and how low I mean can you get $10 million or where do you see the cost side going?  
Charles B. Stanley – President and CEO: When you said 10 million, Jim Torgerson started nodding his head. So, I’m going to say nine or less. Thank you for that, I’ll send you a gift card in the mail. So, I think several key avenues to driving down completed well cost.
On well density:
 I would tell you that we have de facto done that to the East on the reservation where we have drilled some fan-shaped pads because of the configuration of the pads in the lake bottom. So, we have drilled wells that are at the toe are well more than 80 acre spacing. But at the heel, the closest portion before the vertical part of the well, they are very close together because they all M&A from the same pad and have drilled out in a radio pattern from that pad. We are looking at the performance of those wells to see if we can see signs of interference. Obviously, it’s very difficult to determine exactly where in the wellbore we’re seeing interference or if we’re interference at all, but that is an example where we have drilled on closer density. From our original modeling of the acquisition on South Antelope and our analysis of oil in place versus recoverable oil, we think that the right well spacing as four wells per reservoir per 1,280 acre spacing, but obviously we remain open minded about increased density beyond that.

Motley Fool on The "Rig Count"

Regular readers know my opinion on "the rig count."

Here is Motley Fool's opinion:
As for the oil-directed rig count, while it started the year strong, it has declined every month since August. Meanwhile, the supply of crude oil has soared.
The primary reason for this has been incremental technological improvements that have allowed for greater efficiency in drilling.
For instance, Whiting Petroleum registered a massive reduction in drilling expenses thanks to a successful transition toward multi-pad drilling, which has allowed the firm to drill just as many wells but with fewer rigs. And numerous other operators have reported dramatic reductions in the number of days it takes them to drill and complete a well.
For instance, Kodiak Oil & Gas reported that the average number of drilling days from spud to rig release averaged between 20 and 25 days in the third quarter – a major improvement over an average of nearly 35 days a year earlier.

Chevron: Knee-Deep in Liquid Natural Gas -- SeekingAlpha

SeekingAlpha is reporting:
According to the Energy Information Administration, between now and 2030 global energy consumption is due to increase by 44% with oil and gas, along with coal, continuing to meet the largest part of that demand. And as demand for energy grows rapidly worldwide, natural gas, which is one of the cleanest burning fossil fuels, should play a critical role in supplying this demand. Most significantly, the International Energy Agency predicts demand for natural gas will grow by more than 67% by 2030.
Chevron Corp is pushing to become one of the world's largest producers of liquefied natural gas (LNG). With  three (3) LNG projects based in Australia and over $96 billion-net partnerships already invested, CVX is a leading natural gas supplier and liquefied natural gas operator in the Asia-Pacific region. Projects in the region are destined to supply some of the hungriest natural gas consuming continents on the globe, since Australia is just a stone's throw away from the demands of Japan and the rest of Asia.

XOM: Tying Up Loose Ends

Rigzone is reporting:
Exxon Mobil Corp. has won a legal victory in its effort to fight damages of about $1.5 billion stemming from a 2006 gasoline spill in Maryland.
In a decision released Tuesday, the Maryland Court of Appeals reversed more than $1 billion in punitive damages, awarded by a jury in 2011, and said residents and business who accused the energy giant of fraud hadn't sufficiently proven their case.
The court also reversed a large number of compensatory damages, which originally totaled about $500 million.
The case stems back to February 2006 when 26,000 gallons of gasoline leaked from underground storage tanks owned by Exxon Mobil at a fueling station in Jacksonville, Md. The gasoline moved into a water aquifer that supplied drinking water to many residents.

US Navy: $66/Gallon of Biodiesel Is Bad; But $4,455/Gallon of Jet Fuel?

Here's what the US Air Force thinks about such craziness, in an article at The Oil Drum.

I don't think the military will have any trouble finding areas to "cut" if the sequester kicks in.

This is what the US Navy spent for biodiesel fuel (this is per gallon in the far right column):

Feel free to send a copy to Senator Harry Reid, SecDef Hagel, or President Obama, if you think any of them is having difficulty finding places to cut spending. Three words: low hanging fruit.

Yes, Albemarle has a website. I didn't spend much time looking at it. Check out ALB's five-year share price.

Interestingly enough, the US Navy also brought us the $600 toilet seat.

Two Wells Coming Off the Confidential List Thursday

  • 22686, 771, Hess, EN-Jeffrey A-155-94-2734H-1, Alkali Creek, 4-sec sp; t1/13; cum --
  • 23301, drl, BEXP, Timber Creek 13-24 2H, Alexander,
Yup, just those two.


The Jeffrey well was spud August 28, 2012; began the curve September 16; and reached total depth on September 24. No problems. The 2560-acre spacing unit is vertical, the four sections running north to south (or south to north).

CLR's 4Q12 and Full Year Financial Report

From the press release:
Significant fourth quarter and full-year 2012 accomplishments included:
  • Net income of $1.19 per diluted share for the fourth quarter of 2012, compared with a net loss of $0.62 per diluted share for the fourth quarter of 2011;
  • Full-year 2012 net income of $739.4 million, or $4.07 per diluted share, a 72 percent increase compared with net income of $429.1 million, or $2.41 per diluted share, for 2011;
  • Record EBITDAX for the fourth quarter of 2012, which was 44 percent higher than the fourth quarter of 2011 and 21 percent higher than the third quarter of 2012;
  • Record production of 106,831 barrels of oil equivalent per day (Boepd) for the fourth quarter of 2012, a 42 percent increase from fourth quarter 2011 production.
Total production in February 2013 is on track to exceed 120,000 Boepd.

As a result of the Company's improved differential to NYMEX, Continental has reduced its 2013 oil differential guidance range to $5 to $7 per barrel, compared with previous guidance of $8 to $11.
Continental reported net income of $220.5 million, or $1.19 per diluted share, for the fourth quarter of 2012. Net income for the quarter included several non-recurring items, including a $42.7 million after-tax gain on sale of assets and a $4.3 million non-cash unrealized gain on derivatives. Partially offsetting these items were two after-tax adjustments – a charge of $18.1 million for property impairments and a small charge related to the relocation of the Company's headquarters to Oklahoma City. Without these items, adjusted net income for fourth quarter 2012 was $191.8 million, or $1.04 per diluted share, an increase of 18 percent compared with adjusted net income per share of $0.88 per diluted share for the fourth quarter of 2011.

Continental reported full-year 2012 net income of $739.4 million, or $4.07 per diluted share, an increase of 72 percent over net income of $429.1 million, or $2.41 per diluted share, for 2011. Adjusted net income for 2012 was $3.36 per diluted share, without the effects of gains on sales of assets, non-cash unrealized gains on derivatives, property impairment charges and relocation expenses.
So, what did "the market" think of this? Up 2% before the close; up almost 5% after hours.

Kent sent this in from the press release: the second TF2 well is even better than first
Continental's reported its second 3-Forks well (Angus 2-9H-2) in the second bench with initial production of 1,556 boepd, substantially better than the first (Charlotte 2-22H at 1,396 boepd). In what was a 27-mile step-out well, this should arguably strengthen confidence in the viability of deeper benches of the Three Forks as providing a second development area.
Separately CLR has initiated the first of four increased density pilot program targeting the middle & lower benches with 3 wells completed and 2 currently being drilled. Encouraging results from these tests could significantly increase future reserve bookings through down spacing. CLR currently has less than one well per 1280 acre spacing on average versus 4-8 wells per zone required for full development of the field.
Kent asked whether the "estimate of 50,000 wells was before the lower benches of the Three Forks." See this post.

Five (5) New Permits -- The Williston Basin, North Dakota, USA

Active rigs: 181 (steady)

Five (5) new permits --
  • Operators: BEXP (4), CLR
  • Fields: Todd (Williams), Cedar Hills (Bowman)
  • Comments: The four BEXP Todd oil wells will be part of the Field Trust
Wells that came off the confidential list were posted earlier; see sidebar at the right.

A producing well is now completed:
  • 23393, 943, XTO, FBIR Baker 34X-25F, Heart Butte, t1/13; cum -- 


A Note To The Granddaughters

A long time ago, in another life, far, far away, I was awarded a low-interest-rate loan through the Alva J. Field Trust to help pay for college. Superintendent Leon B. Olson was somehow involved. I was quite fortunate to get the scholarship, and over time, I paid back the entire loan. Today, I see that BEXP's four permits in the Todd oil field are for the "Field Trust." I'm sure it is the same trust.

If history is any guide, these BEXP wells should be a great asset for the Field Trust.

Just one more way the Bakken is making a difference for so many. 

By the way, the only superintendent I really "knew" while growing up in Williston was Leon B Olson. I'm glad to see The Bismarck Tribune has not put this article in the archives, that it is still available on-line. It is impossible to overstate how much I thought of Mr Olson. He was truly incredible on so many levels.  To me, he was the "John Wayne of Public School Superintendents" in stature, sagacity, speaking, horse-riding skills, and love of the outdoors.

I do think he would have had mixed feelings about what the Bakken has brought to western North Dakota.

There are a handful of folks I have met over the years whom I will never forget, and Mr Olson is on that short list. Directly and indirectly he made a huge (positive) impact on my life.

Solar: Staggering -- There Goes The Sun

Start with The Oil Drum: The Price of Solar Power, posted February 26, 2013.
All across Europe, feed-in tariffs and subsidies for solar power are being cut or even scrapped. In Portugal and Spain, these actions are justified with the debt crisis, even though they expand these states' trade deficit. This month the Spanish government took a decisive move to scare investors away and expel most renewable energies from the electric grid, particularly solar. 
Inside that linked Oil Drum article is a Reuters article, posted February 14, 2013.
Foreign investors in renewable energy projects in Spain have hired lawyers to prepare potential international legal action against the Spanish government over new rules they say break their contracts.

The Spanish Parliament approved a law on Thursday that cuts subsidies for alternative energy technologies, backtracking on its push for green power.

That measure, along with other recent laws including a tax on power generation that hit green energy investments especially hard, will virtually wipe out profits for photovoltaic, solar thermal and wind plants, sector lobbyists say.
Then, MarketWatch: solar stocks whacked for second straight day.
There goes the sun. Investors took a club to solar stocks for a second straight day Wednesday following First Solar’s disappointing outlook and Trina Solar’s weak fourth-quarter earnings.
In Wednesday morning trade, First Solar tumbled 17% to $26.06. SunPower dropped 9% to $10.63. Trina Solar slid 4% to $4.05. SolarCity declined 4%.
The Guggenheim Solar ETFtan retreated 3% to $17.83, while the Market-Vectors Solar Energy ETF lost 3% to $41.35.
Solar stocks had a heady start to the year, far outpacing the broader U.S. market. But those gains are waning as industry executives warn there still are too many solar panels in the market and no let-up in aggressive price pressure to win new business.
Barron's: First Solar disappointment hammers Chinese solar stocks.

Motley Fool: First Solar showing signs of fatigue.

Disclaimer: this is not an investment site. Make no investment decisions based on what you read at this blog.

EOG and The Eagle Ford -- SeekingAlpha

Link here to

From the linked article:
The increases from 4% to 6% to 8% in recovery factors has all related to what will be recovered through primary development. The message that I see through this industry is that secondary recovery such as natural gas injection or waterflooding will be the really big prize.
Petrobakken which is a company that I follow very closely is already well into a natural gas injection secondary recovery project on its Bakken property in Saskatchewan. Petrobakken (and its main competitor Crescent Point Energy) both believe that secondary recovery will almost double the amount of oil recoverable.
The beautiful thing about the boost in recoveries that will come from secondary recovery efforts are the economics involved. For secondary recovery there is no additional land cost and a huge percentage of the infrastructure is already in place from primary recovery efforts.
A barrel of oil produced through primary or secondary recovery techniques will both sell for the same price in the market. The cost of producing that barrel using secondary recovery might cost half of what producing a primary barrel did.
For newbies, when the Bakken boom was first beginning, "experts" talked of 1 - 3% recovery of original oil in place (OOIP) but it was obvious from initial reports that operators were easily getting 4% and MillionDollarWay posted early that 8% recovery was being seen and/or being reported (directly or indirectly) by some operators. 

8% of 500 billion bbls OOIP = 40 billion bbls.

8% of one trillion bbls of OOIP = 80 billion bbls.

Primary production.

I Don't Care For Motley Fool All That Much -- But Then This -- The Bakken Is A Beast

Motley Fool is reporting.

I generally don't care for the non-subscription posts on Motley Fool. The articles are generally short, superfical, and teasers for their reports. Having said that, the linked article has some interesting data points. The most important data point: the estimated recoverable oil in the Bakken. It might be in CLR's corporate interest to opine that the middle Bakken and the upper Three Forks could have 24 billion bbls of technically recoverable oil, but this is interesting:
Although a 2008 USGS study estimated the Bakken's recoverable reserves at 5 billion barrels, the CEO of the American Petroleum Institute recently estimated that there are 20 billion barrels in the Bakken.
Again, it is my understanding that these estimates are of the middle Bakken and the upper Three Forks. To the best of my understanding, it does not include the lower benches of the Three Forks. When one includes the lower benches of the Three Forks, the number is much, much higher.

The Motley Fool continues:
Takeaway capacity and problems with low prices are limiting proven reserves in the Bakken, but the Enbridge mainline extension with a Bakken spur will provide pipeline capacity, as will the Keystone XL pipeline from Canada. Rail investments, such as those spearheaded by EOG Resources, are additional positive signs.
Note that reserves can only be proven when they are commercially viable. Better takeaway capacity should bump prices up and hence bump reserves up, too.
Furthermore, if Valero, Tesoro, and Phillips 66 have their way with their rail investments, Bakken oil may supplant pricier Alaskan and Brent crude in both East Coast and West Coast refineries.
In short, the Bakken is a beast.

Big Decline In Gasoline Inventories Over Last Week -- CNBC Reporting

Heard on CNBC, there could be errors:
  • Oil inventories rose less than expected; oil inventories rose 1.1 million bbls; analysts had expected a rise of 2.6 million bbls.
  • Distillate inventories were up  0.5 million bbls.
  • But most interesting: gasoline inventories were down 1.9 million bbls (I believe she said "bbls").
She also referenced the huge Motiva refinery in Port Arthur, a 50-50 joint venture between Shell and Saudi Arabia. By the way, that Motiva refinery might account for increasing Saudi imports that will be reported by the government later today. From a December 3, 2012, post:
As part of the recently completed Motiva 325 Mb/d refinery expansion project, Sunoco built 2 MMBbl of crude storage for Shell and a new 30-inch connecting pipeline between Nederland and the refinery. The $10 B Motiva expansion project was delayed for 6 months by damage to the new crude distillation unit but is expected to come back online this week ( first week of December 2012) and increase the refinery capacity to 600 Mb/d.
I would assume oil from Canadian oil sands would compete with oil from Saudi Arabia for this refinery. 

Your Federal Government At Work: This Is Priceless

Bloomberg is reporting, data points:
  • the bureaucratic error occurred under President Clinton
  • Gulf of Mexico leases at issue were signed from 1996 - 2000
  • followed on the heels of a 1995 law intended to encourage drilling by dropping fees when oil prices were low; and reinstating them when prices rebounded (floors and ceilings)
  • bureaucratic error: leases signed in 1989 and 1999 failed to include price thresholds that would trigger royalty payments when prices rose
  • "100s of producers" benefited from this oversight
  • top winner: CVX -- avoided $1.49 billion in royalties; out of $2.62 billion total of all company royalty avoidance
Now, wouldn't you think the courts would agree that this oversight needed to be corrected? Nope, the Supreme Court blocked the government from collecting royalties on these leases. Wow.

Interestingly enough, the industry raised the issue.
“We renegotiated these leases at the time that the concerns were first raised,” Davy Kong, a spokesman for ConocoPhillips, said in an e-mail. “That agreement terminated when the courts ruled that under the law authorizing royalty relief -- the Deep Water Royalty Relief Act of 1995 -- the department did not have the authority to impose price triggers. ConocoPhillips accepts the court’s decision and has no further plans to address the issue.” 
And it gets better. You all know about "leases held by production." It is estimated that the five companies who profited most from this bureaucratic oversight may yet produce the equivalent of 1.6 billion bbls of oil. And no royalties to be paid.

The Bush government, in 2006, asked that the companies voluntarily re-negotiate the leases.

Apparently that offer is still on the table. As my daughter would text, LOL. 

[For "anonymous," if you want to defend the government's actions, write your congresswoman. Or the Supreme Court.]

Ethane Rejection


February 27, 2013: if folks want to see how low price of ethane and propane are affecting the industry in real time, read pages 5 and 6 of ONEOK 4Q12 earnings call transcript.  ONEOK says things will improve when the price of ethane and propane improve (rise in price). Everything I've read suggests that things will get worse (lower ethane and propane prices) before they get better -- and it could last a long, long time.

Original Post 

Yesterday, a reader sent in a great comment on "ethane rejection." RBN Energy has also written extensively on this subject. For those who missed it, I highly recommend you look at the linked post, and, if you have time, explore the site for RBN Energy stories on "ethane rejection." It's a huge story for investors and the US economy. There will be winners and losers. And plenty of investing opportunities.

The Rise in the Price of Gasoline Continues

Long rambling on CNBC, again, about another rise in the price of gasoline. Cue up Connie Francis. And this rise in gasoline has occurred even as WTI has dropped from almost $100 to now, almost $92. Usually when oil drops this much, the neighborhood service station lowers her price on regular gasoline. That hasn't happened this week.

Nationwide average: $3.75. I've talked about the "average" in the past. Doesn't tell the real story. This is where one should follow price of gasoline: California (Los Angeles, specifically); Chicago; and, New York City. Los Angeles would love to see $3.75 gasoline.

California Girds for Electricity Woes -- WSJ: California is Weighing How To Avoid A Looming Electricity Crisis That Could Be Brought On By Its Growing Reliance On Wind And Solar Power

The Wall Street Journal is reporting, three words: "no plan bee."

(I think of The Oil Drum story on the Precautionary Principle which has a lot more relevance than it's "Red Queen" story. Also relevant to this article: Europe's renewable energy woes.)

From the linked article:
Regulators and energy companies met Tuesday, hoping to hash out a solution to the peculiar stresses placed on the state's network by sharp increases in wind and solar energy. Power production from renewable sources fluctuates wildly, depending on wind speeds and weather.
California has encouraged growth in solar and wind power to help reduce greenhouse-gas emissions. At the same time, the state is running low on conventional plants, such as those fueled by natural gas, that can adjust their output to keep the electric system stable. The amount of electricity being put on the grid must precisely match the amount being consumed or voltages sag, which could result in rolling blackouts.
And then this:
Electricity systems need some surplus, so they can cover unexpected generator outages or transmission-line failures, but having too much can depress the prices generators can charge for electricity. In part because of low power prices, many gas-fired generation units aren't profitable enough to justify refurbishments required by pending federal regulations under the Clean Water Act. That means they are likely to be shut by 2020, adding to the state's power woes.
For investors only, speaking  of solar, one of two biggest decliners on today's market:
First Solar Inc.  shares fell 15%. The solar-energy-farm developer estimated first-quarter sales below Wall Street estimates after hours on Tuesday.
Enbridge has a big position in solar. After hours Enbridge fell significantly last night; I suggested it was due to imminent Keystone XL announcement; with huge hit at First Solar, I'm wondering if that might not be the reason.  [Update: with regard to "huge" after-hours drop in ENB yesterday; never mind. ENB is up slightly from yesterday's close. The after-hours drop appears to have been a one-off, but we will see how the rest of the day goes.] Be that as it may, the linked post has always been one of my favorite posts, putting the pieces together regarding Enbridge: pipelines, rail, wind, solar. With pipelines, I assume storage also.

Disclaimer: this is not an investment site. Make no investment decisions based on what you read here. 

The Math Doesn't Add Up

The very first time I posted about wind, I mentioned that with regard to wind, "the math doesn't add up." That was not an original thought; it was what one of the most knowledgeable energy experts had said: with wind (and even more so with solar): the math does not add up.

Now, Harvard has come to the same conclusion. In a report you won't find in the mainstream media, a Harvard study suggests that, yup, with regard to wind, the math does not add up. From CarpeDiem, here's the link.
“It’s clear the theoretical upper limit to wind power is huge, if you don’t care about the impacts of covering the whole world with wind turbines,” says Keith. “What’s not clear—and this is a topic for future research—is what the practical limit to wind power would be if you consider all of the real-world constraints. You’d have to assume that wind turbines need to be located relatively close to where people actually live and where there’s a fairly constant wind supply, and that they have to deal with environmental constraints. You can’t just put them everywhere.”
“The real punch line,” he adds, “is that if you can’t get much more than half a watt out, and you accept that you can’t put them everywhere, then you may start to reach a limit that matters.”
But with enough tax credits, the future for wind farms is unlimited. Except in Europe.

Another Great Way To Start Off the Day -- RBN Energy on Bakken Crude-By-Rail Terminals

RBN Energy with part II of its look at the Bakken crude-by-rail terminals.

Wells coming off the confidential list have been posted. I think OXY has hit a personal low; if not, very close.  And folks worry about setback rules to minimize waste.

The Wall Street Journal has not had a lot the last few days worth linking; let's see if tomorrow is different:

Section D (Personal Journal):

Section C (Money & Investing):
For investors: the day of divergence for US, Europe (link to same story in WSJ, but not a WSJ link); US markets rise; Europe all red; I caught a snippet (less than 30 seconds of Jim Cramer at some point yesterday, and I think he is exactly right: folks focused on Italy, are missing much bigger stories in the US; and clearly a) the energy story; and, b) the ethane rejection story are just two stories that are going to separate the US from Europe at an even faster pace.

Section B (Marketplace):

Section A:
Quietly, but on the front page, Hagel confirmed as SecDef; no link; story everywhere
Internet gambling scores its biggest win; New Jersey approves; huge
Page 3 and we've talked about page 3: California girds for electricity woes; I follow this story closely for two reasons: a) California's energy policies often lead the Fed's energy policies; and, b) with energy investments in California, I have a dog in this fight -- and interestingly enough, California has proved to be very, very rewarding. More on the linked article at this post.

Bernanke: easy money "forever." No link; story forever. For investors only.

Kerry hits bumpy road in world diplomacy; dog-bites-man story; it looks like the president has two winners at the top: SecDef Hagel and SecState Kerry. Huge fodder for talk radio. Speaking of which, I don't think I've listened to Rush in over a year, maybe longer. I quit listening to H. many, many years ago. And #3, what's his name...... overweight, and getting heavier....Fox contributor if I recall...left to start his own show....anyway, I forget his name....reminds me of the Christmas Story movie about the BB gun. I don't miss any of them. But I digress.

Remember all my posts peri-election about foreshadowing the Great Recession of 2013. It still wouldn't surprise me -- to have a recession -- but I am much more optimistic (see above: a) energy; b) ethane rejection). I'm looking for a huge 2013. But having said that, a WSJ op-ed: was the story about Wal-Mart sales in February a harbinger of a recession later this year?

Op-ed: NASCAR's creative destruction. I read the editorial. I learned a bit, but didn't really get excited about the point the author was trying to make.

A must-read: The sequester revelation -- the president -- that would be Mr Obama -- has the legal power to avoid spending-cut damage. But I thought everyone knew that. And, oh, by the way, regardless of what Nebraskan faux environmentalists say, he also has the power to approve/disapprove an international pipeline permit.

Another long op-ed on the sequester. As soon as I saw the author, I did not read the article.

A pretty good day for the WSJ.

And now, from the Daily Mail: Miss Teen USA gives up her crown -- porn video surfaces. She is said to have denied the video earlier, but apparently she misspoke. Perhaps she didn't understand the question. However, many, many story lines if one was so inclined. But, as it is, I digress too much as it is.  Wanna bet her video goes viral -- wherever such videos go viral (speaking of which, HIV, comes to mind).

Tuesday, February 26, 2013

ObamaNation 2013


July 8, 2013: More Americans are "on food stamps" than those who have full-time jobs in the private sector in the US. 

July 8, 2013: quick! who is the #1 employer in the US? Wal-Mart. Now, is #2? Kelly Services: a temporary staffing agency

July 4, 2013: the post-mortems start coming in -- the president spent way too much political capital backing the wrong horse. Politico is reporting:
President Barack Obama insisted Monday that he isn’t taking sides in the standoff between Egyptian President Mohamed Morsi and millions of protesters who’ve taken to the streets to protest his policies.
But that’s not likely to be enough for many in those angry crowds, who seem firmly convinced that the White House has bolstered the Muslim Brotherhood leader, even as ordinary Egyptians — and some in his own Cabinet — have grown increasingly dissatisfied with his rule.
Isn't taking sides? President O'Bama threw Mr Morsi under the bus on July 3. See next story.
July 3, 2013: the administration wasted no time in throwing Egyptian president Morsi under the bus; the Obama administration had been big supporters of this Islamist; the second Egyptian revolution within a year reminds us of the Benghazi debacle.

June 1, 2013:  a reader sent me this via e-mail (no link):
A reader sent this in to the Tallahassee newspaper Zing section: 
"Named my tea party organization Liberal American Progressives Defending Oppressive Government, or LAPDOG.  Got my application for tax-exempt status through the IRS like greased lightning."
May 12, 2013: I don't think there are many things worse in this country than directing the IRS to audit your enemies. It will be interesting to see how far this scandal goes, and if any heads roll

May 12, 2013: how bad is it going to get? I remember at the time of the first inauguration, or the nomination, I forget when, but I do recall very clearly Michelle telling Barack "not to mess it up." Well, this is where we stand on mother's day going into the second term:
  • Правда: seems to be the exactly the right analogy: it turns out that the IRS was targeting not just right-wing, conservative parties, but also schools that were teaching the constitution
  • the mainstream media starting to call Art Carney a "liar" but not actually using the word
  • the mainstream media is turning on Obama on the Benghazi story (see The Atlantic)  
  • his fellow Democrats are starting to see that implementation of ObamaCare later this year will be a "train wreck"; at least one Senator (Montana's Baucus) will not run for re-election because of the debacle about to occur
  • it turns out that Washington missed warnings on the Boston Marathon bomber (though it probably would have made no difference; this administration does not have a good record on returning "bad guys" to their home country when violating their visa status 
  • the GOP is holding up Obama nominations; all the above will give the GOP more resolve
April 18, 2013: Within 24 - 48 hours of the Boston Marathon bombing, a decision was made to "deport" a Saudi national who was of interest early in the investigation. The FBI said they had a suspect, and then said they didn't. One wonders if the FBI had identified a Saudi national as the suspect, and then got a call from the White House to back off. It will be very disturbing if no one is ever held accountable for this terrorist event. It's very likely that the White House made a calculated decision that the loss of three lives in Boston will blow over in a few weeks when no one is held accountable. 

March 19, 2013: Seven US Marines die in a training accident in Nevada, and the President tweets a "White House snack." Absolutely no sensitivity to the military. White House tours, by the way, have been canceled, due to 2% budget crunch. 

March 1, 2013, later: at the press conference, the president says the sequester is "just plain dumb." Wait until we get to the debt ceiling later in the month. And speaking of "just plain dumb," the president's weekend golf outing with Tiger Woods = 341 furloughed government workers. Senator Jeff Sessions calls the president's "response to the sequestration "the most cynical behavior I have seen during my time in Washington." My question: why are furloughed workers given a three-day weekend; the furlough should be on Tuesday or Wednesday if furloughed one day/week. Those are usually the "quiet days." And government workers like to be in the office Monday to order from the internet, especially after Black Friday, the biggest shopping day of the year, after which all the specials are advertised. [March 3, 2013: this sequester that is "just plain dumb." Remember, it was the president who proposed it and now the White House admits it.]

March 1, 2013: looks like the market likes what it sees. The market is up after the news: the president will go through with the sequester order, at least based on his rambling press conference. Did anyone understand his answer to the first question? I left before the second question was asked.  At least I know it was the "other side's" entire fault. Something about the "other side" not giving the president a "dime" in revenue.

First face-to-face meeting between President Obama and GOP Congressional leaders -- on the day the sequester order to be signed. The face-to-face meeting is scheduled to last seven minutes: three minutes to file in; one minute photo-op; and, then, three minutes to file out. February 28, 2013. Everybody knows. 

Everybody Knows, Leonard Cohen

Additional columnists and reporters are coming forward: they've been threatened by the White House to quit writing "negative" stories about the Obama administration. Nixon bunker mentality? Madness? Imploding? February 28, 2013

Democrats complain that a "debt clock" is on display on Capitol Hill, as reported by The Daily Caller, so it is "not displayed" when the Democrats are talking. February 26, 2013.


ABC edits Michelle's comment, February 26, 2013
The uncut, original transcript:
“She was standing out in a park with her friends in a neighborhood blocks away from where my kids…grew up, where our house is. She had just taken a chemistry test. And she was caught in the line of fire because some kids had some automatic weapons they didn’t need,” she said. “I just don’t want to keep disappointing our kids in this country. I want them to know that we put them first.”
The phrases in bold were cut to save time, according to ABC News.

The edited, aired version:
“She was standing out in a park with her friends in a neighborhood blocks away from where my kids grow – grew – up, where our house is. And she was caught in the line of fire - I just don’t want to keep disappointing our kids in this country. I want them to know that we put them first.”
And so it goes.

As reported at The Washington Examiner.

For Investors Only: Enbridge (ENB) Drops After-Hours; About Same Time WSJ Posts An Article Featuring Canadian Ambassador Speaking on Merits of Keystone; Says It Should Be Approved This Spring


February 27, 2013: with regard to "huge" after-hours drop in ENB yesterday; never mind. ENB is up slightly from yesterday's close. The after-hours drop appears to have been a one-off, but we will see how the rest of the day goes.

Original Post
The Wall Street Journal is reporting:
Canadian officials have been ramping up their public lobbying in support of U.S. approval of TransCanada Corp.’s Keystone XL pipeline expansion. The Obama administration is expected to make a ruling in coming months
Amid that campaign, Gary Doer, Canada’s ambassador to Washington, told Canada Real Time that he has a question for the American people: “Do you want your oil from Hugo Chavez or do you want it from Canada?” 
Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read at this site.

Wells Coming Off The Confidential List Wednesday Including Another OXY USA Well; QEP Looks To Have a Huge Well

20750, 53, OXY USA, Katie Heiser 1-12-1H-142-95, Murphy Creek, t8/12; cum 2K 12/12;
21868, 957, Zavanna, Barker 24-13 1H, Boxcar Butte, t12/12; cum 36K 12/12;
22029, 1,961, QEP, MHA 4-32-29H-150-91, Heart Butte, t11/12; cum 30K 12/12;
23466, 226, American Eagle, Silas 3-2N-163-101, Colgan, t12/12; cum 10K 12/12;
23598, DRY, Whiting, Kittelson 32-27R, wildcat, a Deadwood well; northeast of Beach, in the southwest corner of the state; probably a Red River well;


20750, conf, OXY USA, Katie Heiser 1-12-1H-142-95, Murphy Creek:

DateOil RunsMCF Sold

 21868, conf, Zavanna, Barker 24-13 1H, Boxcar Butte:

DateOil RunsMCF Sold

22029, conf, QEP, MHA 4-32-29H-150-91, Heart Butte:

DateOil RunsMCF Sold

 23466, conf, American Eagle, Silas 3-2N-163-101, Colgan

DateOil RunsMCF Sold

Midwest Motor Express Expands In Rapid City, SD

The Rapid City Journal is reporting:
Midwest Motor Express has announced plans to build a new $2.3 million service center/terminal at 3720 Seger Drive, off Interstate 90 Exit 61.
The new facility will have a larger footprint than the company’s current location at 540 Deadwood Ave. and, with four additional freight doors, also offer more flexibility.
It will also mark the first time in Midwest’s 30-year Rapid City history that the North Dakota-based freight company will own its building here.
The company:
Midwest Motor Express is considered a “less-than-truckload carrier.” It provides shipping services for individual pallets and smaller shipments. Founded in 1918, the company has 30 service centers in 16 states.

Well Completions of Interest in Montana

The Fairfield Sun-Times is reporting:

In Petroleum County, Central Montana Resources, LLC turned in a completion report for the Snowmane 6. The well, which taps into the Heath Formation, has a total depth of 4,244 feet. The well reported an IP of 125 barrels of water per day (no typo -- I can't access original source to confirm).

In Richland County, Whiting Oil and Gas Corporation reported the completion of three Bakken Formation wells. 

  • The Double Bar M 24-32H: an IP of 375 bopd; 233 mcfpd.
  • The Kittleson Federal 34-23-1H: an IP of 564 bopd, 128 mcfpd. 
  • The Kittleson Federal 24-24-1H: an IP of 558 bopd, 45 mcfpd.
Continental Resources Inc. reported the completion of the Helen 3-19H in Richland County: IP was 642 bopd, 342 mcfpd. The well targets the Bakken Formation.

In Sheridan County, Marathon Oil Company filed a completion report for the Dave Clark 21-13H; the Three Forks Formation well reported an IP of 159 bopd, 74 mcfpd.

Amarillo Snowfall: Nearly Breaks the 1893 Mark; 19.1 Inches

NewsChannel10 is reporting:
She says the city's snowfall was the second-most in a 24-hour period, just behind the 19.3 inches that fell March 25, 1934. The storm that moved across the Texas Panhandle also was the third all-time snow event. The most snow in one event was 20.6 inches that fell March 25 and 26, 1934.
Scotten says Amarillo normally receives 17.8 inches of snow for the winter.
19.1 inches vs 19.3 inches. If this were the NFL, someone would throw the red flag, and want a re-measure.

The US has had a cold, snowy winter.  Southern Los Angeles to Denver to Amarillo and Kansas City to Boston.

Only Three (3) New Permits Today But Several Producing Wells Now Completed

Active rigs: 182 (steady)

Three (3) new permits --
Operators: OXY USA (2), Zenergy
Fields: Crooked Creek (Dunn), Glass Bluff(McKenzie)
Comments: well, that was easy.
Wells coming off confidential list were reported earlier; see sidebar at the right.

Producing wells that are now completed:
  • 21518, 710, CLR, Lawrence 5-13H, North Tioga, t1/13; cum --
  • 23567, 356, Whiting, McNamara 42-26XH, Sanish, t1/13; cum --
  • 23060, 763, Hess, LK-M Elisabeth 147-97-1522H-4, Little Knife, t2/13; cum --
  • 23319, 1,271, BEXP, Porter 35-26 1TFH, Alexander, t1/13; cum --
  • 22619, 781, CLR, Sorenson 2-21AH, Alkali Creek, 4-section spacing; t2/13; cum --
  • 22971, 1,103, Whiting, Rodney Olson Federal 42-8-2TFH, t1/13; cum --
  • 22620, 946, CLR, Thronson 2-28AH, Alkali Creek, t2/13; cum --
  • 22618, 907, CLR, Thronson 1-28AH, Alkali Creek, t2/13; cum --
  • 23048, 606, CLR, Chicago 3-26H, Banks, t1/13; cum --
  • 21980, 569, CLR, Florida 1-11H, Camp, t1/13; cum --
The two Thronson wells are on the same 4-well pad as the Sorenson well.  The fourth well on that pad (#22617, another Sorenson well, is on DRL status). The four wells are long laterals on 4-section spacing.

Check Out These BNSF Figures -- As Provided By KFYR

KFYR is reporting:
"We knew that the Bakken was big. But like many people, we didn`t know exactly how big. But we ramped up very quickly and in accordance with what the customers were telling us and what the experts were telling us about how big the reserves were," said John Miller with BNSF.

BNSF started exporting crude oil from western North Dakota in 2008. It started carrying 1.3 million barrels a day. Within four years, its export volume jumped to 100 million barrels a day.

"We`re real pleased with the growth in crude oil by rail on BNSF. And we`re still excited about the growth for the future," Miller said.

2012 was a big year for rail in North Dakota. Exports increased by 36 percent. And the reason rail is having so much success is because trains can reach coastal refineries that will pay more for oil.
For newbies: North Dakota produces about 750,000 bbls of oil per day. 

Something tells me the story will be corrected. A "screenshot" has been taken, just in case.