Saturday, September 7, 2013

CLNE Making Progress

Finally, a pretty big story for CLNE. I don't invest in CLNE; I'm not interested in the company as an investment opportunity one way or the other but I always like the maps.

SeekingAlpha has a nice update on this company and perhaps a "breakthrough" of sorts.
All along, the major catalyst and excitement over investing in Clean Energy was the CWI 12L engine that finally hit production in August. When announced in February 2012, the product was expected to commence production in early 2013. The engine originally hit limited production in April to allow for customer testing and isn't expected to reach full commercial run rate until year-end.
The ISX12 G engine is based on the Cummins ISX12 diesel engine platform and operates exclusively on natural gas (both CNG and LNG). The engine utilizes the proprietary spark-ignited, stoichiometric combustion with cooled exhaust gas recirculation technology. It is designed for regional-haul truck/tractor and has a displacement of 11.9 liters and up to 400 horsepower and 1,450 lb-ft torque.
Also at the linked article:

America's Natural Gas Highway station stats:
  • 76 stations built
  • 24 stations under construction
  • 30 stations in the contracting and proposal process
  • 200 to 300 stations needed in the future
As the company continues to point out, the key to opening a station is having 20 trucks using the station. The goal is to ultimately reach 100 trucks per station to quickly turn the payback period to one year.

Saturday News, Views, And Links; New Frontier Plans To Build Rail/Industrial Park In Williston


September 10, 2014: see KUMV story below about the new rail terminal east of Williston. Today it was announced that ground-breaking any day now and that initial operating capability scheduled for March, 2015, about 7 months from now. 

Original Post
Active rigs: 184

Huge news: rail industrial park planned for Williston (sent to me by a reader, thank you). KUMV-TV is reporting:
New Frontier is about to build the East Valley Rail and Industrial Park in Williston. Oil, construction, and other major suppliers in the oil patch will be able to purchase products from around the country, and have them shipped via railroad straight to Williston. 

WSJ Links

Earlier this week I pointed out (again) the poor jobs report. Today, that's the lead story, front page, top story in The Wall Street Journal: tepid jobs report muddies Fed plans
The disappointing jobs report released Friday leaves Federal Reserve officials without a clear-cut signal of an economy on the mend, creating a dilemma for the central bank as it contemplates pulling back on a landmark bond-buying program designed to stoke growth.
Many investors have grown convinced in recent months that Fed officials would take a first step toward reducing the $85-billion-a-month bond-buying program at their Sept. 17-18 policy meeting. The program has become an almost-daily obsession in markets, and the prospect of it shrinking has pushed long-term interest rates higher while stocks have seesawed. 
Friday's jobs data did little to move the needle in either direction. Employers added a steady, if unspectacular, 169,000 jobs in August, and the unemployment rate fell to 7.3% last month. That's notable improvement from the 8.1% unemployment rate when Fed officials launched the latest stimulus program late last year, but job growth has been anemic in recent months, below the 200,000-a-month level some officials want to see. 
The IBM story, moving its retirees off its health care program was also in the front section, telling folks just how big a deal this story is.  For investors this is all great news. Folks who invest in blue chip companies will see expenses for those companies go down. Their health care costs will be spread across the entire US population. The gap between the "haves" (investors) and "have-nots" (non-investors) will continue to widen.
International Business Machines Corp. plans to move about 110,000 retirees off its company-sponsored health plan and instead give them a payment to buy coverage on a health-insurance exchange, in a sign that even big, well-capitalized employers aren't likely to keep providing the once-common benefits as medical costs continue to rise.
The move, which will affect all IBM retirees once they become eligible for Medicare, will relieve the technology company of the responsibility of managing retirement health-care benefits. IBM said the growing cost of care makes its current plan unsustainable without big premium increases.
Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or anything you thought you might have read here. 

Crude oil settles at 28-month high - Syrian tensions. Key words: growing US - Russian impasse.

Week 36: September 1, 2013 -- September 7, 2013

Oasis acquires 161,000 net acres in the Bakken
EOG reports a 62-stage fracked well
CLR has permits for an 8-well pad in the Sanish -- the Limousin wells

Hess increases dividend by 150%

Five charts highlighting the US energy revolution


I occasionally get queries regarding my shorthand in summarizing a well, for example:
  • 24485, 511, Murex, Lori Ann 4-9H, Writing Rock, 37 stages; 3.1 million lbs; gas averaged 1,038 units; 1/11 - 1/30;  t3/13; cum 22K 6/13;
This is my shorthand; it is NOT used by the oil and gas industry.

The first five data points are generally always there; after that the data points and comments may vary. The last three data points in the example above are always there also, once the well is producing.

The first data point is the permit/well file number, in this case: 24485.

The second data point, always in red bold, is the 24-hour initial production (IP) as reported by the company. It is what it is, barrels of crude oil; in this case: 511.

The third data point is the operator, in this case: Murex.

The fourth data point is the name of the well, in this case: Lori Ann 4-9H. Each operator has a unique way of naming their wells. It is a well-known parlour game to try to interpret the names.

The fifth data point is the name of the oil field, in this case: Writing Rock.

After that, the data points may vary, and they may vary in order.

In the example above:

The sixth data point was the number of fracking stages, in this case: 37. With regard to stages, 24 to 36 is pretty much the norm now for a long lateral in the Bakken; EOG is going up to 40, 50, and 60-stage fracks.

The next data point was the amount of proppant used, rounded to the nearest million (generally) pounds; in this case: 3.1 million pounds of proppant was used. Proppant is the general term for the various kinds of sand and/or the various kinds of ceramics used in fracking. Sometimes just sand, sometimes just ceramics; sometimes both are used. The well files can take time to read and I won't spend much time on them, so this data could be wrong. Generally about 100,000 lbs/frack stage; though again, EOG is testing huge amounts. The usual amount of proppant for a long lateral is 4 million lbs; EOG is using as much as 10 - 12 million lbs.

The next data point is completely unnecessary, but I sometimes post it for various reasons, in this case the measured gas units. Sometimes the units are reported all along the lateral; sometimes never reported in the geologist's summary. 

The next data point in this example is seldom posted, but when it is, it is the spud date and the date they reach total depth; in this case, from January 11 to January 30. Sometimes I post the number of days. 

Then at the end comes the stuff I always post: t3/13 is the month and year the well was tested; that was the date the IP was measured/reported.

The final data points in this example is the cumulative production as of the date note, in this case, the cumulative was 22,000 bbls of crude oil as of June, 2013. I always round the number of bbls to the nearest thousand. 

In this way, one can see how long it took to produce a certain amount of oil from the day it was tested to the date my shorthand note was updated.  

Disclaimer: I often make typographical errors which I will generally catch within a few days. Some errors are not caught unless someone points them out to me. Do not use this data as a source. If you are interested in data for a well, go to the source, the NDIC.

Overall Employment Drops; Oil And Gas Industry Employment Increases

Rigzone is reporting:
The unemployment rate dropped to a 4.5 year low and job growth was less than expected in August as workers gave up the search for work, the U.S. Labor Department said Friday. The unemployment rate fell to 7.3 percent, the lowest since December 2008.
Economists had expected job gains of 180,000 last month and for the unemployment rate to hold steady at 7.4 percent, reported Reuters. Additionally, hiring was less than expected in August, with the job count for June and July revised to show 74,000 fewer positions added than previously reported.
While overall employment dropped, the oil and gas industry saw gains, adding 193 jobs in May, 193 in June, 195 in July and 196 in August. As for employment by occupation, petroleum engineering grew the fastest, adding 19,880 jobs in 2012, with the geoscientist occupation adding 9,640 jobs.
It could be a whole lot more if Washington were even the least bit supportive.

Five Charts Highlighting US Energy Revolution -- CarpeDiem

CarpeDiem has a nice column today with several graphs putting the US energy revolution in perspective.

Folks should note that this revolution, this huge production is occurring, despite:
  • the federal government slow-rolling the industry
  • ban on drilling on much of the land controlled by the Feds
  • ban on drilling off-shore in many areas
  • ban on in drilling in the US Arctic for all intents and purposes
  • during a recession
The turnaround is due to successful oil and natural gas exploration and production in a relatively small area of the US.

China Signs Deal For Stake In Huge Kashagan Oil Project; US Meanders And Dithers

Reuters is reporting:
Chinese President Xi Jinping struck a deal with Kazakhstan on Saturday giving China a stake in its giant Kashagan oil project, a highlight of his tour of Central Asia to secure hydrocarbons for the world's largest energy consumer.
The $5 billion deal further increases China's rising clout in post-Soviet Central Asia, once Russia's imperial backyard, and blocks an attempt by global rival India to get a stake in the oilfield, the world's largest oil discovery in five decades.
"The two countries have agreed on China's shareholding in the development of the Kashagan deposit," Xi told a news briefing after talks with Kazakh President Nursultan Nazarbayev. "The two governments hail and support this agreement."
Oil and gas deals, including on building an oil refinery in Kazakhstan, are among 22 agreements worth some $30 billion reached during Xi's visit, Nazarbayev said.
Meanwhile, the US continues to dither on a) meaningful oil and gas energy policy; b) the Keystone XL; and, c) the Arctic.

The US will move ahead with Federal fracking regulations to slow down / stymie US oil and gas industry.

On the other hand, the Kashagan hasn't turned out all that successful to date.  Maybe the Chinese will have better luck.

IBM Moving Retirees Off Its Health Care Program -- They Will Move To O'BamaCare


FoxNews is reporting:
International Business Machines Corp. plans to move about 110,000 retirees off its company-sponsored health plan and instead give them a payment to buy coverage on a health-insurance exchange, in a sign that even big, well-capitalized employers aren't likely to keep providing the once-common benefits as medical costs continue to rise.
The move, which will affect all IBM retirees once they become eligible for Medicare, will relieve the technology company of the responsibility of managing retirement health-care benefits. IBM said the growing cost of care makes its current plan unsustainable without big premium increases.
IBM's shift is an indication that health-insurance marketplaces, similar to the public exchanges proposed under President Barack Obama's health-care overhaul, will play a bigger role as companies move coverage down the path taken by many pensions, paying employees and retirees a fixed sum to manage their own care.
Just in time for the 2016 elections. 

I Won't Be Updating Any More Bakken News For Awhile

Scroll down, scroll sideways, or go to Bakken Shale Discussion Group for a particularly lively discussion. The discussion-master has closed the topic. It got too lively, I guess. And just when it was getting good. Sad face.

I'm going to a soccer game.

Good luck to all.

Another Failed Department of Energy Enterprise -- Only $50 Million, Fortunately

Remember that list of 38 solar companies that went bankrupt or were likely to go bankrupt? All financed by the US Department of Energy. I guess I sort of thought the DOE could only lose money on solar companies. Apparently not.

It's a convoluted story with lots of capital letters and acronyms, and I didn't spend much time on it, but apparently DOE provided a $50 million loan to some natural gas minivan company to build a wheelchair-accommodating minivan. The company went broke. Some other company bought the company that went bankrupt, paying DOE $3 million for the $50 million asset.

I'm sure I got it wrong, but you can read it at the link. Bottom line: US taxpayers got $3 million back for a $50 million loan.

And they say Bank of America took advantage of home buyers with their loans. I can't make this stuff up.

Greenland Ice Melt Adding 0.59 Millimeters To Sea Level Per Year -- NASA, The Folks Who Crashed A $125-Million Climate Orbiter Due To Simple Math Error

This may be the best story of the day to put things into perspective when you think about Syria.

Get out your metric rulers, folks. Find the centimeter mark. Yes, the mark that is about half-an-inch. (I need to use a magnifying glass at my age.)

Now, if you squint really hard, you can see the ten little hash marks that make up one centimeter. Each of those little hash marks is one millimeter. Yes, those little things. Millimeters. Ten of them in about half-an-inch.

Back in 2011 (most recent data), sea levels rose by about half of one of those millimeters from the ice that melted from Greenland. Yes, I know you can't see it, but believe it. If Bloomberg and NASA said Greenland ice melt contributed 0.59 millimeters to global sea levels then it must be true.

Not reproducible. The only place they can measure 0.59 millimeters is in computer modeling: garbage in, garbage out. So, we will cap and tax our American businesses, ignore China's contribution to "global warming," and worry about 0.59 millimeters -- half of one of the ten little hash marks on a metric ruler.

I can't make this stuff up.

Hidden in this article was this data point. The amount of ice in Greenland and the Arctic is a small percent of the total ice in Antarctic. Over the past decade the Antarctic probably increased in size by as much as 2 percent.

By the way. Who are some of the folks measuring this 0.59 millimeter rise in the sea levels? NASA. Aren't they ones that forgot to convert feet to meters and snowballed a $125-million Mars Climate orbiter into Mars? LOL:
NASA lost its $125-million Mars Climate Orbiter because spacecraft engineers failed to convert from English to metric measurements when exchanging vital data before the craft was launched, space agency officials said Thursday.
A navigation team at the Jet Propulsion Laboratory used the metric system of millimeters and meters in its calculations, while Lockheed Martin Astronautics in Denver, which designed and built the spacecraft, provided crucial acceleration data in the English system of inches, feet and pounds.
$125 million. Forget to convert feet to meters. I can't make that up either.