Sunday Evening Ramblings -- So This Is What A Government Shutdown Feels Like: 90% Of The Government Keeps Functioning; Government Workers On Paid Vacation; EPA Shut Down; Refracking In The Bakken

I enjoyed the rambling yesterday morning: it cut down on a lot of clutter. Instead of a bunch of individual stand-alone posts, it was just one long post.

Let the rambling begin.

So, what have we learned on day 6 of the government shutdown?

• 83% of the government is still functioning
• almost anybody connected to the military is essential
• bringing back "all" the military civilians will move the overall "83%" figure closer to 90%
• the EPA is shut down
• the few furloughed government workers are on paid vacation (they will all get back pay and they are eligible for unemployment benefits while sitting this out -- what's not to like?)
• national parks and military memorials (WWII, Iwo Jima) are the only "real" things closed in a government shutdown
• according to one poll, only 10% are affected by the shutdown
• no one from the national park service reads this blog

Prior to the shutdown, almost nothing was working in this economy except the oil and gas industry and now, not even the President or Congress are working. The POTUS has said he will not negotiate. And, of course, with 90% of the government still up and running (but not working) and the government workers on paid vacation, there's not much to negotiate. Why didn't the powers that be think of shutting down the government when ObamaCare was being voted upon? It would have saved a lot of unnecessary trouble (and spending).

Wow, I need some music for a Sunday night.

Killing Me Softly, Perry Como
Switching gears ('cause this blog is subtitled "All Bakken All The Time"), I missed this. Over at SeekingAlpha a trusted source Bret Jensen discusses Emerald and NOG. Emerald used to be VOG. NOG and VOG. VOG and NOG. If I remember correctly, brothers are CEOs. This is where my "snapshot" comes in handy. EOX sold its Colorado acreage this past year and is now completely focused on the Bakken, all 48,000 acres. Market cap is $330 million + debt of zero dollars = $330 million. At $10,000/acre, $480 million. It was up 7% on Friday. The stock is selling at $7.50. Back in February 2012, it was selling for $25.

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read at this site or think you may have read at this site.

But I'm digressing. The reason I wanted to highlight Bret Jensen's article is because of one of his comments he made in passing. On Thursday, October 3, the 3rd day of the government shutdown, Sun Trust Robinson recommended Whiting as a "top pick due to revolutionary completion techniques."

Quick, to Whiting's September 30, 2013, presentation, and some data points on completions:

• will double down on the density in its Pronghorn prospect: 6 / 1280 vs initial plan of 3/ 1280
• new completion techniques extend their Lewis & Clark prospect to western edge of the field
• at Pronghorn, a pilot at the Obrigewitch unit tested their new cemented liner completion approach, achieving a significantly higher IP than adjacent wells that used a sliding sleeve completion
• higher density drilling in the middle Bakken in Hidden Bench is being considered
• new Missouri Breaks cemented liner completion designs has yielded strong results
• doubling down on Missouri Breaks density: 8 / 1280 vs current plan for 4 / 1280
• downspacing in WLL's cash cow, the Sanish, could add up to 3 additional middle Bakken wells per 1280-acre unit
• WLL also plans to refrack several wells in the Sanish in 2013

But what really got my attention were the slides on its play in its Redtail Niobrara prospect:

• Whiting is accelerating its Redtail development
• currently a 2-rig program; will add a 3rd rig in October
• Whiting is going to a 16 well/drilling spacing unit
• so far, has drilled 46 wells; has 21 more permitted locations; the additional 2-year inventory is 33; WLL estimates 2,992 future wells bringing the total to 3,390 total well. 
• So, again, they have drilled 46 wells; they will get to 3,390 wells with 16 wells/DSU in the Niobrar
• I'm not sure about the size of the DSU in the Niobara, but on slide 32, WLL mentions 960-acre units
• recovery rate in the Niobrara: somewhere between 10% and 20%

So, that's it for Whiting.

Goldman Sachs likes Oasis. Sun Trust likes Whiting.

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There is so much going on in the North American oil and gas energy revolution, it's hard to know what to post and what not to post. I really did not want to post this article, but when readers send me articles, I obsess about whether to post or not to post. I listened to the Perry Como song above twice before finally deciding to reject this story. And then I saw the $35 billion price tag again. That's a huge project. So, we will link the article. Bloomberg reports that a Malaysian company will invest $35 billion in western Canada to produce, gather, and ship liquid natural gas from western Canadian oil sands to Prince Rupert, British Columbia. Some data points:

• the Malaysian company, Petronas, bought Canada's Progress Energy Resources, for $5 billion in 2012
• after Canada initially blocked the takeover (the Keystone XL debacle probably changed some Canadian minds)
• the pipeline will be built by Keystone XL's TransCanada Corporation
• the acquisition made Petronas the second-biggest stakeholder in the Montney shale-gas area of British Columbia
• the acquisition gave Petronas full control of three Progress Energy fields in which Petronas previously only held stakes

So, $35 billion for Malaysia-Canada, and President Obama can't even come to a decision on a $2 billion cross-border pipeline. For the US under President Obama: a lost decade.