The Red Queen -- March 13, 2015

From the Director's Cut yesterday, the two big stories:

• flaring: target met (if I read the numbers right)
• the Red Queen

During the height of the boom (defined as the number of active rigs greater than 185), the number of wells waiting to be fracked were in the 250 - 350 range -- mostly due to shortage of frack spreads.

Then, when they went to pad drilling, the number of wells waiting to be fracked, crept up towards 400, the increase mostly due to operational reasons associated with pad drilling. With six wells on a pad, one waits until the last well reaches total depth before the entire pad is fracked. Six wells -- six months. I think the classic case -- CLR's Atlanta wells in Baker oil field -- 14 wells -- 18 months after the first well was spud before the pad was fracked (note disclaimer; if this information is important to you, go to the source; do not rely on this blog).

Last month, the Director's Cut for December, 2014, data noted that the number of wells waiting to be fracked was at 750, a decrease of about 25. The month prior, the November, 2014, data:

Back on December 13, 2014, I suggested exactly that: the operators would stop fracking. Look at this: generally there were about 400 wells waiting for completion, then it jumped to 450, then 650, and now 775, an increase of 125 in the past month. That is quite astounding. (Also, December 18, 2014; and, December 16, 2014.)

It's tough to frack in North Dakota in late December, January, and February (and late March/April) due to the weather (extreme cold followed by the spring melt), but that jump to 775 was quite an eye-opener.

So, now yesterday, the most recent Director's Cut, for January, 2015, data, where do we stand with number of wells waiting to be fracked? It jumped to -- 825 wells -- an increase of 75.

I don't know about you, the "average" reader -- what you think -- but when the backlog was in the 250 - 350 range, mostly due to shortage of frack spreads, it was a huge headline and a huge concern -- frackers couldn't keep up with operators. Now, it's something entirely different. We approaching 1,000 wells (in round numbers for those who like to average / think in round numbers). I think it's a huge story.

[By the way, companies have one year to complete a well once it is drilled in North Dakota -- see link here.]

Actually two stories. The first one I mentioned above: the Red Queen. Despite almost a thousand wells waiting to be fracked, North Dakota production dropped .... drum roll ... by about 3% month-over-month. And that occurred during some of the worst weather of the year. The Red Queen. We're going to have wait a few more months for the Red Queen to fall off her treadmill.

The second story: how much fracking will be done how soon?

So many more story lines, but I will stop here for now. Eight-hundred-fifty wells -- an increase of 75 -- month-over-month -- waiting to be completed.

Oh, and the wells are going to get better and better simply because of better technology, better completion techniques, more experienced roughnecks; more experienced geologists; better understanding of the middle Bakken and better understanding of the upper bench of the Three Forks.

Oh, one more thing. The wells will get better simply because during this period of a slump in oil prices, the operators are circling the wagons, drilling in the best areas they can.

Wow, there are simply too many story lines.