Saturday, March 23, 2013

Waterflooding in the Bakken? Crescent Point Energy Looking at Unitization and Waterflooding in the Canadian Bakken

Petroleum News is reporting:
For Crescent Point Energy, recognized as one of the most innovative players in Bakken-type plays, one of the keys to unlocking the value of its Canadian resource assets lies in a combination of waterflooding and unitization. 
The mid-range producer is now eagerly awaiting a decision by the Saskatchewan government to allow that province’s first “unitization” in 20 years, opening the door for multiple owners in pools to create single operating units, requiring each to contribute to capital and operating costs, while sharing in the profits based on their stakes.

Bakken Hunter Has Raised The Bar On Flaring


March 27, 2013: Read the original post about Bakken Hunter aligning wells with natural gas pipelines. Unrelated, a reader sent me this:
[A local McKenzie County official] talked about how the rigs are going to move right down the section lines. He said it was battle between the geologists and the engineers. Geologists would put the rig in the middle of the section or where ever the “proper spot” was. Whereas the engineers looked for a logistically correct solution. Engineers won. As a result, the rigs will and wells will be in more of straight line versus all over the place. This makes it easier since less roads need to built, natural gas and oil pipelines are straightdown the field versus zig.
This also explains the need for 2560-acre spacing.

Original Post

Bakken Hunter, a subsidiary of Magnum Hunter, will align its wells pad with ONEOK pipeline and have natural gas pipeline hooked up to site before the wells go into production.

This is not trivial.

Petroleum News is reporting:
In February, Bakken Hunter, a subsidiary of Magnum Hunter, submitted applications to the North Dakota Industrial Commission requesting 13 new 640-acre spacing units and 10 new 1,280-spacing units in the Bounty School field where the company wants to drill up to eight wells on the 640-acre units and as many as 16 wells on the 1,280-acre units. 
What is unique about the application is that Bakken Hunter has configured the multi-well pads to line up with Oneok’s Divide County east-west trending natural gas gathering pipelines. 
The pads in the 640-acre spacing units would be at the top or the bottom of the spacing unit, but in the 1,280-acre units, the pad would be in the middle of the unit so as to line up with Oneok’s gathering lines.
So, does this mean short laterals in 1280-acre spacing units?

In the same article, Petroleum News noted that Whiting was also taking action to eliminate flaring in its Lewis and Clark Three Forks play in Billings and Golden Valley counties. In this play, Whiting is minimizing flaring to 1%.

Winter Storm

Lead story on tonight's NBC Evening News: major surprise winter storm.

The earth quit warming sixteen (16) years ago.

"Winter is overstaying its welcome." -- NBC talking head.

Storm hit the mid-section of the US, right along I-70.

Reuters reports. Also, LA Times reports.

On another note, and completely unrelated, was a story on a food bank for university students. Most, if not all students operating the food pantry, or using the food pantry, appeared to be overweight or grossly overweight, including the very, very obese male that started the segment and ended the segment.

SeekingAlpha Is Slipping --

I wouldn't pay any attention to this one.

The first tip-off is the headline: Great ready for the big one -- Bakken flooding coming this year.

"Great ready." Say what?

On a more substantive basis: suggesting that the Bakken might flood because the Red River might flood this year is inanity.  The writer has no clue. Not even worth saying anything more. Most likely the writer is shorting Bakken stocks.

For newbies, a very, very wet spring in the Bakken will make things difficult, for about a month. And roads are always a problem. But the Bakken will do just fine. Unlike Libya or the Mideast, I don't expect to many wars or terrorist events in the Bakken. Unlikely, as well, is an off-shore oil spill. There are plenty of things to worry about when investing in the oil and gas sector. Worrying about the Missouri flooding is not one of them.

By the way, when someone talks about flooding in the Bakken, it suggests to me the individual does not know much about the Bakken. A much, much bigger problem impacting increased oil production is inadequate natural gas takeaway capacity. Oil companies have to choke back production if they can't get their natural gas into the pipeline

The Rest of the Saturday Morning WSJ Links

Design & Decorating: what to do with the TV? For all the new Bakken millionaires, this is a must-read. One idea not shown: place a flat-screen on one's microwave oven door for the kitchen. And as long as you have gone that far, Velcro an iPad to one of the kitchen cabinet doors: perfect for recipes. [See photo #8 at this link.]

Section C (Review): another article on "the brains of the animal kingdom." The subject, for some reason, has never interested me. Perhaps it bothered me that animals, in general, seem to have more common sense than politicians.

Not much there today. Sorry. But the iPad Velcro hint was worth the price of the blog today.


From the Washington Times: staffers earning $60,000 to $160,000 are on the brink of starving due to the sequester -- so says Debbie Wasserman, a Floridian federal representative; Obama's pick to lead the Democratic National Committee. One comment at the site:
Wasserman is a total nut job, she makes $80-100,000 a year and complains about a $2 bowl of soup. She can't keep up with her own propaganda.
A Note To The Granddaughters

Now, back to Mendeleev on the Periodic Law, Selected Writings, 1869 - 1905, edited by William B. Jensen.

As noted at the link, I did not enjoy this book the first time I read it. I tried to like it, but it just didn't work for me. But I thought I would give it another try.

It turns out to be a great book. Very, very fascinating. But one has to do two things. Read the book very, very slowly; and have access to the internet while reading it.

A little bit of back story. Many years ago I read Virginia Woolf's Mrs Dalloway for the first time because I was told it was a classic, a masterpiece. I don't now recall my thoughts regarding Mrs Dalloway after reading it for the first time, but I know I did not understand it and did not know what all the fuss was about. So, the second time I read it, I read it very, very slowly and discovered it was a prose poem. That led me to type the entire book in blank verse. A portion of what I discovered is over at my literature blog.

Now, back to Mendeleev. Upon reading the book a second time, I am reading it very, very slowly. The book is not so remarkable if one simply concentrates on the subject, the periodic table. What is so remarkable about the book, and why it is important to read is this: it is interesting to follow Mendeleev's thought process as he was trying to work out the problem. It is similar in that regard to reading James Watson's "biography" of the "double helix."  (Of course, the two books -- Mendeleev and Watson -- are very dissimilar. I doubt anyone reading this blog, and I doubt that either of you -- will ever read, much less enjoy Jensen's book on Mendeleev. It is pretty dry.)

But it is great "fun" to get a bit of insight into how Mendeleev cracked the code. In retrospect, it's hard to believe that ordering elements based on their atomic weights was not obvious. But that was the first piece of the puzzle that Mendeleev noted: if one wanted to put some order into chemical elements, one had to put them into some kind of order, and at its most basic level, to put them in order based on atomic weights.

I don't think that took a lot of insight. But then ... then ... then, that almost miraculous jump, when Mendeleev noted that there was a periodicity in the chemical behavior of the elements.

Having the internet available while reading the book makes the book so much more enjoyable. Early on, the editor notes that the discovery of gallium in 1875 was the impetus for chemists to re-look at Mendeleev's theory which he had published in 1869, and revised in 1870. Every chemical element is incredibly interesting in its own right, but when one gets the feeling that so much hinges on gallium (at least in this particular case, in this particular moment in chemistry), it is nice to be able to go to the net and read about gallium. And even nicer to have a wikipedia that puts so much in one spot and in words that a lay person can understand.

Hemoglobin is a metalloprotein, incorporating iron (FE) into the protein. It turns out that gallium (GA) acts a lot like iron and, therefore, gallium is used in medicine (pharmaceuticals and diagnostics). In addition, gallium is the source for blue and violet light emitting diodes (LED).

Sometimes one has to read a book very, very slowly to really enjoy it; really understand it. At least I do. And sometimes, one has to be ready to read it. And, of course, that's one of the problems for students; most often students are not ready to read assigned reading assignments. Smile.

There's no way I would have read either Mrs Dalloway or selected papers of Mendeleev if either had been assigned reading in college. But now: awesome.

Long, Long Article on Apple in LA Times -- Worth A Read

Link here to an interesting article. I've read it once, need to read it again. Some excerpts and comments (for newbies, indented paragraphs are from the article; they are not my words):
I should stop here to declare my interests. I don't own Apple shares. My household is 100% Mac, including three MacBook Airs, but we're atypical Apple customers. None of our four smartphones is an iPhone. We don't own iPads or any other tablets (Kindles don't count); I'm still waiting for Apple to make the case that I need one. I've written about Apple in all its various incarnations since 1995. In that time I've read a lot of valid reporting about Apple, and a lot of hooey. The hooey usually gets more widely circulated.
That comes close to describing our family. My wife has an iPhone only because our son-in-law bought it for her and pays the monthly data fee as part of a family plan. I don't have an iPhone. In fact, I don't have a smart phone. However, one big difference: both my wife and I love the iPad. I do wonder about someone who writes about Apple who doesn't understand the iPad. I don't need Apple "to make the case that I need one." I figured that out on my own. I can't imagine using an iPhone or MacBook Air in bed to read the news before I get up or before I fall asleep.  With grocery stores right across the street, I don't need a freezer either, but I have one. No marketer/advertising agency had to make the case that I need a freezer.
A few notable points should be kept in mind when pondering Apple's stock market behavior. One is that the slide in its shares coincided with a period in which it became the most profitable company in the United States, and by no small margin. In the last quarter of 2012, Apple racked up more than $13 billion in net income. The next two names on the list were ExxonMobil and Chevron, oil companies that rise and fall with the price of crude. To find another industrial company you had to go to No. 4: Microsoft, which reported profit less than half of Apple's.
That was incredible. 
A key error here is the notion that a Samsung or Android user is the equivalent of an iPhone user. The latter are willing to pay more for their phones and use them far more vigorously than the former. They buy more apps and spend more time with them. Market analysts figure that the iPhone, despite being outsold, generates roughly 70% of all operating profit in the mobile device industry, Samsung's devices almost all the rest.
This imbalance confuses pundits. "Rather than see Apple as being in a strong position, and being very good at what it does, a lot of people look at these numbers and think Apple's just had fluke good luck," John Gruber, a technologist and former software developer who blogs about Apple at his website, told me by email.
A long article by a well-informed writer, but still no mention of the best thing going for Apple: the Apple eco-system.

The second best thing going for Apple: the aesthetics. Once one has an Apple product, they tend to replace their next tech device with an Apple. Example: all those folks on PCs who bought the iPad when it came out. When their PC needed upgrading, they migrated to a MacBook. MacBooks really can't do anything more than a PC, and one can still get "more PC" for a buck. Apocryphal or not, Meg Whitman, when given a company computer when she took over HP, was said to have said, "No, thanks. This is a clunky brick. Get me a MacBook" or something to that effect.

So, a nice long article, but the writer missed an opportunity to talk about the Apple eco-system, and Apple aesthetics. And the writer failed to mention how Apple controls its "apps." All that gibberish about the Steve Jobs myth and Tim Cook is old, and getting older by the minute. That may be the reason that the Ashton Kutcher film on Steve Jobs may have been delayed, and risks coming out at all -- perhaps direct to DVD.


This morning, in Starbucks, while typing the above, two elementary school-age children sat at the table across from me while their parents sat elsewhere. She looked about 9 years old; he about 7 years old. She was checking her iPhone, while he was on his iPad.  I assume he didn't need Apple to "make the case that he needed one." Now while waiting for my wife's car to be serviced, two of the three people waiting are on their computers or tablets. Both of them are using Apples.

Saturday Morning WSJ Links

Section D (Off Duty): later

Section C (Review): later

Section B (Business & Finance):
Section A:

And now a special treat for readers: links to today's Barron's. Barron's has been nice enough to send me copies at no cost. Don't ask. Unfortunately, not much there.

Oil will fuel shipping shares
A Note To the Granddaughters

This is real cool. On the front page of the WSJ today: science fiction comes alive as researchers grow organs in lab. I say it's "really cool" because years ago I wrote a short story on the subject. The story is filed away in one of my boxes of memorabilia.

Week 12: March 17, 2013 -- March 23, 2013

Game changer in the Bakken; biggest story of the week
EOG's super-long horizontals; first well sets new record, 213,000 bbls in less than 5 months

Bakken Operations
BR's Mesa Verde wells with great IPs
Oasis has a gusher, Elery H, Camp
Bakken Hunter has a nice well, first time out, BH HZ, Crosby
BEXP has a gusher, Porter, Alexander
American Eagle has a nice well along the border
BEXP with two nice wells north of Williston
MRO with two nice wells
Oil activity in the Minot area? Finally?
Decline rate for top 20 producing wells in the Bakken -- Filloon
The top 47 producing wells in the Bakken, January, 2013

Sand for fracking
South Dakota Black Hills: another source of sand; very, very close to the Bakken; don't these lawyers and companies every learn? Huge public announcement -- will draw environmental activists to the Black Hills, like moths to a flame.

Alberta's take on the Bakken
XTO will withdraw permit near Elkhorn Ranch; activists said 100 wells already there; don't need another;
Biggest divorce settlement ever? Harold Hamm announced divorce proceedings
Average oil production per well per day in the Bakken

Takeaway: Pipelines
What is it about the US and pipelines; US denies another pipeline, Sandpiper denied; Canadian company denied

Takeaway: Rail
Enbridge, Phillips 66 negotiate 3-year deal for Berthold terminal
More on the Berthold terminal