Tuesday, March 19, 2013

Wells Coming Off The Confidential List Not Posted -- NDIC Website Remains Down

The following wells came of the confidential list today, but results won't be posted here until the NDIC website is back up:
22445, 975, OXY USA, Hattie Dvorak 1-33-28H-142-96/Easton 1-35-26H-142-95, Russian Creek, t9/12; cum 19K 1/13;
22642, 2,271, Oasis, Birdhead 5200 41-22T, Camp, t10/12; cum 74K 1/13;
22740, 3,863, Oasis, Larry 5301 44-12B,  Baker, t9/12; cum 51K 1/13;
23172, 812, Fidelity, Kudrna 5-8H, Heart River, t9/12; cum 48K 1/13;
23249, 3,888, BR, Lovasas 11-1TFH, Blue Buttes, t12/12; cum 4K 1/13;
23374, 8,683, Hess, EN-Ortloff 156-94-2635H-2,  Big Butte, t2/13; cum 17K 1/13;
23570, 2,602, Newfield, Sand Creek Federal 153-96-23-14-10H, Keene, "Bakken/ThreeForks," t2/13; cum --

The following wells will come off the confidential list tomorrow, Wednesday:
20355, 1,127, Petro-Hunt, USA 153-95-1A-7-2H, Charlson, t2/13; cum --
21558, drl, QEP, MHA 3-31-36H-150-92, Heart Butte,
22101, drl,  Petro-Hunt, Thorson 159-94-7A-18-3H, North Tioga,
22885, drl,  Hess, LK-Wing 146-97-2215-3, Little Knife, 
23487, 26, Surge Energy, Scandia 1N NENE 34 02 NENW 35H, a Spearfish/Madison well; t11/12; cum 2K 1/13;
The following wells will come off the confidential list on Thursday
22487, drl, EOG, Hawkeye 02-2501H, Clarks Creek, no production data; 3-section spacing; 1,741 acres in the spacing unit; sister well to the well announced earlier with 200,000 bbls in less than 5 months; another 15,000-ft horizontal; trip gas over 4,000 units;
22601, 176, Baytex, Karlgaard 22-15-160-98H 1PB, Skabo, t10/12; cum 16K 1/13;
22602, 207,  Baytex, Karlgaard 27-34-160-98H 1XP, Skabo, t10/12; cum 20K 1/13;
22744, 276, Baytex, M. Johnson 35-26-162-98H 1PB, Whiteaker, t11/12; cum 41K 1/13;
23152, 722, Whiting, Talkington 41-26PH, Park;  t9/12; cum 25K 1/13;
23439, drl, Denbury Onshore, Thompson 21-11SEH, Charlson, 

Wow: Direct Pipeline-To-Rail Operation, Berthold Oil Terminal; Time For A New Poll


March 21, 2013: Enbridge, Phillips 66 announce 3-year deal for Berthold oil terminal

Original Post

Remember that incredible video of that long line of trucks waiting to unload oil at the Bakken Oil Express facility west of Dickinson? Get a load of this: the Minot Daily News is reporting a direct pipeline-to rail operation at Enbridge's Berthold Oil Terminal:
  • the terminal can fill an entire unit train (100 - 118 rail tank cars) in 14 hours
  • can fill up to 8 unit trains/week
  • a unit train carries 80,000 bbls of oil
  • can accommodate three unit trains at one time
  • previously, this terminal would fill a unit train with oil trucked in, taking five to six days
Go to the link at the Minot Daily News to see the photo and get additional information. 


Pipeline, The Chantays


Time for a new poll. 

First, the results the current poll. The question was: if federal leases are inadequate to fully fund the president's new Energy Security Trust to fund more Solyndra-like projects, would you be willing to support an initiative to transfer some of your Bakken royalties to the Energy Security Trust?
  • Yes: 7%
  • No: 93%
Now, the new poll:
Watch the video above, and then watch the linked video at the very top of this post. After watching both videos, which do you prefer to see: more videos of trucks hauling oil in the Bakken, or more videos of scantily clad women surfing off the Big Island?

Say It Ain't So, It's Not What I Want To Hear

Two articles. The first one links an earlier article.

First, the more recent article:
I have written before about the disappointment inherent in batteries.
Now I have another personal example. Just when I had decided that my batteries were in their prime, crash.
In our forced migration from fossil fuels over the coming century, large scale implementations of solar and/or wind are likely to transpire only in connection to energy storage solutions. With storage comes headaches, even for technologies as mature as lead-acid. Batteries will fail, and seldom at convenient times.
I liken my recent experience to driving a car without a gas gauge. How tolerable will this situation be to our demanding society? Big adjustments ahead…
Now, the author's earlier article, battery performance deficit disorder:
Don’t get me wrong: even though I dwell on the shortcomings of batteries in this post, I still hold a net positive view. When it’s dark at my house, my refrigerator, television, computers, and internet goodies are all powered by stored sunlight in lead-acid batteries. My laptop battery gets me through many a bus ride and an occasional airplane ride. Batteries really do work, and provide value. Moreover, electric cars are more than a notion or fantasy: they are actually on the road getting people where they want to go.  Despite their lackluster performance next to fossil fuel storage, batteries still beat the pants off of mechanical or gravitational storage.
And even though I might appear to be picking on the Chevy Volt by highlighting its deficiencies, I actually rather like the design point (electric vs. gasoline range hits the sweet spot, in my view). In fact, I was half way to buying one. By half way, I mean that if the price were cut in half, I would surely have one now.
The real point is that batteries fall pathetically short of our customary fossil fuel energy storage medium. When we wake up to a declining global availability of petroleum, we won’t just switch over to electric cars. We may not be able to collectively afford such a transition, given the huge up-front costs in both money and energy. Where will the prosperity come from? If oil shortages drive recession in the usual fashion, expensive options may be off the table.

Say It Ain't So, Joe, Roger Daltrey

The NDIC Website Is Still "Compromised"

Scout tickets unavailable.

No links to daily activity report for yesterday or today.

Unable to download the GIS map server.

Despite Recent Explosion in Oil Production, North Dakota Ranks Just Third in the Nation -- Yahoo!Finance; Another Reporter Who Has Just Emerged From Under The Geico Rock

This was a front page story at Yahoo!Finance today. I have no idea what the point of the story is, but there are two possibilities (discussed down below).

Yahoo!Finance is reporting:
It's no secret that North Dakota has been in the middle of an oil boom since about 2008, but a new chart from the North Dakota Industrial Commission, Department of Mineral Resources, shows just how steep the increase has been.
It is a lot of oil, to be sure, but even with this recent explosion in production North Dakota is in just third place nationally. Texas produces a staggering 2,220,000 barrels per day, and the rigs that operate in the U.S. Federal Offshore region account for another 1,389,000 barrels per day. North Dakota currently accounts for about 10% of all U.S. crude production.
What do you think? About 75% of North Dakota's crude oil is transported out of the state via truck and railroad, limiting the amount that the state can extract at any given time due to weather and capacity constraints. Is more pipeline capacity the answer?
This line caught my attention:
It is a lot of oil, to be sure, but even with this recent explosion in production North Dakota is in just third place nationally
Just third place? I thought North Dakota was in second place.

I guess someone has moved the goal posts: up until this story, North Dakota was ranked #2 among the states, but now the "powers-that-be" have added "US Federal Offshore region." It's nice to see the production of the US Federal Offshore region posted, but it was a surprise, to say the least.

My hunch is that this was "politically" motivated. There's been a lot of news lately that the huge increase in US production has been from non-Federal leases. It only makes sense that the White House would call reporters and remind them that the US Federal Offshore region is #2. [It would have been too obvious to ignore Texas.] It's generally agreed that the president has a thin skin and he's probably tired of being told his offshore oil production is not keeping pace. And if it was not the White House making the call, the other likelihood is the reporter is pro-administration and has added this new wrinkle.

Also, the story was very, very short, and out of the blue it raises the issue of takeaway capacity: truck, rail, or pipeline. Strange story.

Maybe it's a two-fer. The reporter gets to put a plug in for President Obama's Offshore oil production, and will also get a feel for pipeline support -- a most important metric. There must be a huge amount of discussion inside the beltway whether to approve another pipeline, the Keystone.


For newbies, a lot of media outlets are very, very busy and looking for "filler" or stories. A lot of these media outlets do not have their own reporters, again driving the need for "filler" stories. The more I look at this story, and then noting the link to a White House site, I just get a feeling the whole thing was planted by the White House, or by a reporter very, very friendly to (or an apologist for) the administration. The "press release" is sent out and then media outlets looking for filler pick up on it.

The Bakken is getting a lot of press. Every day there are stories about how much oil is coming out of North Dakota, now accounting for nearly 12% of US production, while at the same time there are more and more stories coming out that report oil production from Federal leases is not keeping pace.

Something about this very, very short news story with no new news making the front page of Yahoo!Financial just does not ring true. And out of the blue, to ask about the need for a new pipeline. No, something is very, very strange about this article.


For Obama apologists this will be a tough graph to interpret, but look at it for a minute. Speaks volumes:
This graph says it all. From The Energy Collective. Production from "Obama fields" continues to decrease; production from non-Obama fields has picked up momentum year-over year.


I'll certainly be glad for the NDIC website to get back up and running; it will give me less time to think of conspiracy theories like the above.

File Under "Predicted"

Politico is reporting:
Congressional committees are taking note of a massive spike in the price of corn ethanol credits that refiners use to meet the Environmental Protection Agency’s renewable fuels mandate — amid concern it could increase gasoline prices.
House and Senate energy panels are eyeing the price of ethanol renewable identification numbers, or RINs, which have skyrocketed from pennies a gallon to more than $1 per gallon in recent weeks. That could cost the refining industry $7 billion this year, according to a Barclays analyst as cited by the Financial Times.
But not to worry. The cost of ethanol will only increase the price of gasoline by about 10 cents/gallon.
The volatility and price hike have set Wall Street abuzz and become the top issue for refiners — some of whom are buying millions of RINs on any given day. Industry officials are also using the price spike as additional ammunition to try to get Congress to either scrap or significantly modify the existing annual renewable fuels production mandates.
At a public meeting March 8 in Michigan on EPA’s proposed 2013 volume requirements for the renewable fuels mandate, Marathon Petroleum testified that corn ethanol RINs prices could amount to a 10-cent increase in gasoline prices.
But refiners are going to take a beating. Unless they pass the cost of ethanol unto the consumer. Let me guess.

EPA-mandated ethanol production reminds me a lot of USSR's central planning back in the day. That worked out well, too.

Random Update on CHK Royalty Payments

A reader send me a link to this article regarding Chesapeake royalty payments. The Star-Telegram is reporting:
Fort Worth investor Ed Bass and more than a dozen other landowners in far south Tarrant County have sued Oklahoma City-based Chesapeake Operating and Chesapeake Exploration in federal court in Dallas, accusing the energy company of cheating them out of potentially millions of dollars in royalties.
The plaintiffs own 3,952 acres which include Trinity Valley School, which sits on 74 acres, and the 660-acre Rall Ranch. The property, including Bass's Winscott Ranch, is located at the Tarrant and Johnson county line, south of Benbrook Lake. They leased their mineral rights to Chesapeake and gave the company rights to drill on their land for a share of the money made off those wells, according to the suit, which was filed today.
But Chesapeake allegedly underpaid those royalties, improperly passed along production costs and made up "sham transactions" with two affiliate companies for the sale of gas at the wellhead to set the price on which royalties were paid, breaching the terms of the lease, the lawsuit contends.
One can see this stand-alone post, same subject, posted back on August 11, 2011

Read more here: http://www.star-telegram.com/2013/03/14/4689707/ed-bass-other-plaintiffs-sue-chesapeake.html#storylink=cpy

From The Mailbag -- Heath Formation in Eastern Montana Frustrating Drillers

A reminder: January production for the top 47-producing wells in January, 2013, has been posted.

From the mailbag:

I received this as a comment from a reader. For easier access, here is the comment (I embedded some of my data to make it easier to access):
Nothing to do with this post directly, but there was an article on the Bismarck Tribune's website yesterday.

Titled "Shale Formation in Montana Frustrates Oil Drillers."

On a somewhat related note, but a different formation:
Note Hamm's comment about Montana Bakken:

On March 6, Harold Hamm, chief executive of Continental Resources, the biggest player in the Bakken, told Hauptman he was running into drilling issues exploring the western edges of the Montana Bakken.

“We’re not blessed with the great big pool of Bakken oil,” which is centered in western North Dakota, Hauptman said of his telephone conversation with Hamm.
MDU says it is pulling its one rig out of eastern Montana. This is the company that completely missed the North Dakota Bakken, and let a company from Oklahoma (CLR) get the headlines. 

Time To Go Ice-Fishing; NDIC Site Still Down -- Though It Seems To Be Getting Closer to Being Back Up

Oil is up.

The market is up.

Too bad the NDIC website is not up.

Bakken oil is selling at a 25-cent premium to WTI at Clearbrook, MN.

The WTI/Brent spread remains at $15, the spread continues to narrow.

Roads are still a challenge in some parts of North Dakota, but at the moment, no "no travel advisories."

Time to go ice-fishing.

Catch me at MillionDollarLiterature if interested. The book I'm reading this a.m.: A World of Insects, edited by Ring T Carde and Vincent H Resh. Quick, can you tell me what insect the ant evolved from? I asked my 9-year-old granddaughter: I forget her first guess. Her second guess: the wasp. Correct.

Shoveled 10 Inches of Global Warming and It's Still Falling -- Tuesday Morning -- NDIC Website Seems To Be Coming Up

The NDIC website might be coming up. I was able to sign in to "Basic Services" and get the screen for "Scout Ticket," but cannot access any files. Also, the daily activity reports is only current through last Friday. Someone suggested global warming brought down the NDIC site earlier this week, although that's hard to believe, because I think the site went down late Friday night, and I didn't think the global warming storm hit until until Monday. I really don't know.

RBN Energy: rail and Canadian bitumen (dilbit); part I.

And yes, I just shoveled ten inches of heavy, wet, global warming. Then, since the streets were relatively clear, road my bike to Starbucks where I am now. It's possible that I will have to go to the on-line Wall Street Journal since it was not delivered this morning. I have never read the WSJ as a complete newspaper on-line, although I have a subscription. I prefer the hard copy.

WSJ Links

The links today were taken from my paid subscription. I assume you will need to used google reader to access the articles. Sorry. But I didn't get my print copy of the WSJ today.

Section D (Personal Journal):

Section C (Money & Investing):
Section B (Marketplace):
  • Shale gas boom alone won't propel US industry;
  • Still, the price of natural gas is only one factor manufacturers consider when deciding where to locate plants. Taxes, labor costs and skills, regulation and government incentives also figure into the mix. Perhaps the biggest factor is long-term demand for goods. The biggest growth in demand is still expected to be in China, India and other emerging markets. Global companies typically want to locate production near their biggest customers. 
  • This can't be good: Fisker sales talks fall apart
  • Chesapeake seeks to retire debt;
  • Another one bites the dust: Suntech defaults on debt; this is why we need the president's Energy Security Fund NOW! To save these companies. Here is the list of 38 green companies/mostly solar companies that have gone bankrupt or having serious money problems. SunTech was not on that list because that list was only US DOE-backed companies. It was said that US solar companies went bankrupt because China was dumping solar panels on the US. Well, hello! SunTech is a Chinese-based solar panel company and it can't make it either. 
  • Suntech, based in Wuxi, China, is one of the world's largest solar-panel manufacturers, but it has been struggling under more than $2 billion of debt. Its profit has declined amid a global oversupply of solar panels and a drop in prices, as well as antidumping tariffs imposed by the U.S. government on solar equipment imported from China.
  • Washington Post to start charging for website; the beginning of the death spiral; 
Section A:
  • Page 3 and we've talked about page 3 before. Wow! This is really, really cool: Clearer picture of art heist:
    It has endured as one of the most perplexing mysteries in Boston and the wider art world: Who pulled off the Isabella Stewart Gardner Museum heist, stealing 13 artworks worth an estimated $500 million, including rare paintings by Rembrandt, just after 1 a.m. on March 18, 1990. 
    On Monday, the 23rd anniversary of the crime, the Federal Bureau of Investigation for the first time said it believes the thieves belonged to a criminal organization based in the mid-Atlantic and New England states. The agency declined to provide further details about the suspects, citing a continuing investigation, but it said it now believes that after the theft, the stolen haul was taken to Philadelphia and Connecticut and then offered for sale in Philadelphia about 10 years ago.
    Although it doesn't know the current whereabouts of the art, the FBI believes it might still be in the Philadelphia area. So the agency will launch a publicity campaign, soliciting tips using social media and, within a few weeks, putting up digital roadside billboards in and around Philadelphia, where it believes someone may have glimpsed—or even bought—the art without knowing of the tainted origin. The museum is offering a $5 million reward for a tip leading to the recovery. The theft represents the largest property crime in U.S. history, according to the FBI.
  • Playing post office: Congress is not going to let the US Postal Service end Saturday delivery;  USPS is losing $16 billion/year; cutting Saturday service would save $2 billion;