Thursday, June 30, 2016

Random Look At A Non-Descript Well With Huge Jump In Production Before Settling Down -- June 30, 2016

I have to run; I will finish this post later. But check out the production jump on this well back in the summer/autumn of 2013. This was a previously fracked well. The jump in production was not due to any work on this well as far as I am aware. So, what happened?

The last sundry form submitted for this well was back in 2012.
Regular readers have probably already guessed the answer. 

BAKKEN4-20141918361079760147014700
BAKKEN3-20143024332662617351835180
BAKKEN2-201428519255651002501750170
BAKKEN1-201431599258231523525352530
BAKKEN12-201331490446151465441231871225
BAKKEN11-201330911892262140802762071820
BAKKEN10-20133167736764303360025692310
BAKKEN9-2013301770817902212816480164800
BAKKEN8-2013261800717547339214073123731700
BAKKEN7-2013101860000
BAKKEN6-2013276586001742537847
BAKKEN5-20133199011663068365330
BAKKEN4-201330970775225985980
BAKKEN3-20133110441080135655650
BAKKEN2-2013289271046203663660


**************************

The screenshot:



The well that had that incredible jump in production (spreadsheet above) was:
  • 16510, 1,082, CLR, State Weydahl 44-36H, Corral Creek, open hole frack, 1 million lbs, t4/07; cum 316K 5/16; 
These two wells were fracked at the time the well above had that jump in production:
  • 23785, 400, CLR, State Weydahl 3-36H1, Corral Creek, a Three Forks well, 30 stages, 2.9 million lbs, t8/13; cum 233K 5/16;
  • 23786, 691, CLR, State Weydahl 2-36H, Corral Creek, 30 stages, 3.7 million lbs, t8/13; cum 241K 5/16; (by the way, Smokey 13-7-19-14H, #24786 incorrectly scanned in with this file)

Deaths In US Due To Tesla Self-Driving Technology Now Exceed Number Of US Deaths Due To Bakken Crude Oil CBR -- June 30, 2016; Tesla Fatality Occurs In Williston

The fatality occurred in Williston, FLORIDA, not North Dakota.

To the best of my knowledge, there have been no deaths in the US due to a Bakken crude oil CBR unit train derailing and exploding.

From SF Gate:
The first U.S. fatality using self-driving technology took place in May when the driver of a Tesla S sports car operating the vehicle's "Autopilot" automated driving system died after a collision with a truck in Florida.
The government is investigating the design and performance of Tesla's system.
Preliminary reports indicate the crash occurred when a tractor-trailer rig made a left turn in front of the Tesla at an intersection of a divided highway where there was no traffic light. The Tesla driver died due to injuries sustained in the crash, which took place May 7 in Williston, Florida, the agency said. The city is southwest of Gainesville.

NP Resources On The July, 2016, NDIC Dockets -- June 30, 2016

I believe this is the first mention of NP Resources on the blog; I don't know if there have been additional postings on NP Resources, until today. At that post:
NOTE: Whiting transferred about 63 wells to NP Resources; reported on today's daily activity report. The most recent was #30807; the oldest was #08874. All were in southwest North Dakota; in Golden Valley County and Billings County, with about four exceptions (McKenzie County). Full list is here
For the July, 2016, NDIC dockets:
25126, NP Resources, Elkhorn Ranch-Bakken, establish 13 1280-acre units, 4 wells on each; create two stand-up 640-acre units, 2 wells each; Billings County
Note: that's the case number on the dockets, not a permit number.
  
I track various oil fields in North Dakota through this post, but to date I have not had a stand-alone post on Elkhorn Ranch-Bakken.

I will post a screenshot of the Elkhorn Ranch-Bakken for the archives, so we can see the "before" and "after."

Today:


I did not take a screen shot of the spacing in this oilfield, but it appears about 1/4 of the field is spaced at 640-acre units; 1/2 are 1280-acre units; and 1/4 are "other."

Eleven (11) New Permits; Ten (10) Permits In The Bakken Renewed -- June 30, 2016

Eleven (11) new permits:
  • Operators: EOG (8), BR (2), Oasis
  • Fields: Clarks Creek (McKenzie), Bailey (Dunn), Banks (McKenzie)
  • Comments: it appears the EOG permits are for 8 wells on the same pad in Clarks Creek, SWSE 7-151-94;
Ten (10) permits renewed:
Emerald (7), seven Maverick permits in McKenzie County
MRO (3), a Ross (Dunn County); and, a Moline, and a Lacey USA permit, both in Mountrail County

Active rigs:


6/30/201606/30/201506/30/201406/30/201306/30/2012
Active Rigs3076191189215

Wells coming off confidential list Friday:
  • 30280, SI/NC, BR, Merton 21-15TFH, North Fork, no production data,
  • 30833, SI/NC, XTO, TAT State Federal 14X-36G, Bear Creek, no production data,
  • 30834, SI/NC, XTO, TAT State Federal 14X-36D,  Bear Creek, no production data,
  • 31925, 1,332, Liberty Resources, Haustveit 155-95-12-13-2MBH, Capa, t1/16; cum 82K 5/16;
  • 32004, SI/NC, BR, CCU Zephyr 44-34 MBH, Corral Creek, no production data,
 ***************************************

31925, see above, Liberty Resources, Haustveit 155-95-12-13-2MBH, Capa:


DateOil RunsMCF Sold
4-201694410
3-2016184320
2-2016191500
1-2016265150

India: Potential WIth Regard To Natural Gas -- June 30, 2016

The first thing that jumped out at me when I saw this pie graph: all the potential for natural gas.



******************* 
Starbucks Employees Complain Of Hard Working Conditions

When I read this story two things jumped out at me. The writer mentioned neither a) ObamaCare; nor, b) the $15 minimum wage.

Fortunately those making comments mentioned both. 

CLR To Apply For 28 Wells On An Existing 2560-Acre Drilling Unit, Jim Creek Oil Field -- June 30, 2016

Updates

December 25, 2016: random update of the 9-well Pletan-Dvirnak pad in this 2560-acre spacing unit.  There are nine wells on this pad: three Pletan wells run south; six Dvirnak wells run north:


***************************************************************************



***************************************************************************



The Pletan-Dvirnak pad:
  • 30136, 1,008,,CLR, Pletan 5-18H2, t11/18; cum 72K 1/19;
  • 30137, 1,232, CLR, Pletan 6-18H1, t11/18; cum 94K 1/19;
  • 30138, 2,574, CLR, Pletan 7-18H, t10/18; cum 134K 1/19;
  • 32748, 2,728, CLR, Dvirnak 7-7H1, Jim Creek, t10/18; cum 131K 1/19;
  • 32749, 2,358, CLR, Dvirnak 8-7H, Jim Creek, t10/18; cum 171K 1/19;
    PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
    BAKKEN10-20183162410622447163078652715277125
    BAKKEN9-20184775176377373826558932372
    BAKKEN8-20180000000
    BAKKEN7-20180000000
    BAKKEN6-20185134013409870179901799
    BAKKEN5-20181001468000
  • 30139, 2,034, CLR, Dvirnak 4-7H2, t10/18; cum 122K 1/19;
  • 30140, 2,962, CLR, Dvirnak 5-7H, Jim Creek, t10/18; cum 185K 1/19;
    PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
    BAKKEN10-20183154376543904630464676588175859
    BAKKEN9-2018717544172861514418708133385370
    BAKKEN8-20180000000
    BAKKEN7-20180000000
    BAKKEN6-201871577157712800142701427
  • 30141, 2,076, CLR, Dvirnak 6-7H1, t10/18; cum 100K 1/19;
  • 32899, 2,186, CLR, Dvirnak 9-7H, t10/18; cum 134K 1/19;
Original Post

From the NDIC hearing dockets, Thursday, July 28, 2016:
  • 25171, CLR, Jim Creek-Bakken, 28 wells on an existing 2560-acre unit, sections 6/7/18/19-146-95, Dunn
That is the "case number," not a permit number.

Although it has not been updated in awhile, this is where I track the Jim Creek oil field

For newbies: the current wells in this area are sited on 1280-acre units, so the 28 wells on the 2560-acre unit would be in addition to the wells already in these sections. 

A screenshot of the 2560-acre unit:


This is what the current area looks like where the wells might be situated:



Wells/locations in the above screen shot (see production data):
  • 30136, see above, CLR, Pletan 5-18H2, Jim Creek,
  • 30137, see above, CLR, Pletan 6-18H1, Jim Creek,
  • 30138, see above, CLR, Pletan 7-18H, Jim Creek,
  • 32748, see above, CLR, Dvirnak 7-7H1, Jim Creek,
  • 32749, see above, CLR, Dvirnak 8-7H, Jim Creek,
  • 30139, see above, CLR, Dvirnak 4-7H2, Jim Creek,
  • 30140, see above, CLR, Dvirnak 6-7H, Jim Creek,
  • 30141, see bove, CLR, Dvirnak 6-7H1, Jim Creek, 
A four-well pad in the area:
  • 20806, 744, CLR, Dvirnak 2-7H, Jim Creek, t12/11; cum 318K 1/19;
  • 20808, 1,106, CLR, Pletan 3-18H, Jim Creek, t12/11; cum329K 1/19;
  • 20807, 831, CLR, Dvirnak 3-7H, Jim Creek, t12/11; cum 392K 1/19;
  • 20809, 1,294, CLR, Pletan 4-18H, Jim Creek, t12/11; cum 222K 1/19;

Dockets Posted For July, 2016

Dockets posted for July, 2016.

Highlights

Wednesday, July 27, 2016
25114, BR, Dimmick Lake and Elidah-Bakken, a stand-up unit, 13 wells, McKenzie County
25119, True Oil, Red Wing Creek-Madison, a 640-acre unit, or a 960-acre unit, or an 800-acre unit, 1 horizontal well, McKenzie County
25125, Hess, Alkali Creek-Bakken, an overlapping 2560-acre unit, 11 wells, Mountrail
25126, NP Resources, Elkhorn Ranch-Bakken, establish 13 1280-acre units, 4 wells on each; create two stand-up 640-acre units, 2 wells each; Billings
25135, BR, Elidah-Bakken, 7 wells on a 1280-acre unit; 10 wells on a 1280-acre unit; 2 wells on an overlapping 2560-acre unit; McKenzie

Thursday, July 28, 2016
25153, WPX, Reunion Bay-Bakken, 8 wells on a 1280-acre unit; 8 wells on each of two 1280-acre units; Mountrail, Dunn
25160, Crescent Point Energy, Little Muddy-Bakken, 6 wells on a 1200-acre unit; Williams County
25165, XTO, Lost Bridge-Bakken, 8 wells on a 1920-acre unit; Dunn County
25171, CLR, Jim Creek-Bakken, 28 wells on an existing 2560-acre unit, sections 6/7/18/19-146-95, Dunn
25184, Liberty Resources, McGregor-Bakken, 8 wells on an existing 640-acre unit, section 20-158-95; Williams County

The Agenda

Wednesday, July 27, 2016
8 pages

25113, Cornerstone Natural Resources, Woburn-Bakken, proper spacing, Burke County
25114, BR, Dimmick Lake and Elidah-Bakken; establish three overlapping 2560-acre unit; 1 well each, McKenzie
25115, Lime Rock Resources, Russian Creek-Madison and Russian Creek-Bakken, i) to all the Heiser Trust 11-3H (#16395) to be completed in the Madison Pool as an exception to the rule; ii) allow commingling of hydrocarbons from the Madison and the Bakken wells; Dunn County
25116, Lime Rock Resources, Hungry Man Butte-Madison and Hungry Man Butte-Bakken, i) designate a 160-acre unit in Zone 1 of the Hungry Man Butte-Madison pool; ii) allow completion of State Gresz (#29398) to be completed as a an exception to rule; iii) allow commingling of hydrocarbons from Madison and Bakken wells; Billings County
25117, Lime Rock Resources, Little Knife-Madison and Little Knife-Bakken; similar to case #25116, Dunn County
25118, Lime Rock Resources, Cabernet-Madison and Cabernet-Bakken; similar to case #25116, Dunn County
25119, True Oil, LLC, Red Wing Creek-Madison; establish a 640-acre unit and either a 960-acre unir or an 800-acre spacing unit, 1 well; McKenzie
25120, Legacy Reserves Operating, Beaver Creek-Red River, to allow a second well, Golden Valley County
25121, Hess, Blue Buttes-Madison, NDIC commission to review the TA status of a specific well, McKenzie
25122, Hess, Blue Buttes-Madison, NDIC commission to review the TA status of a specific well, McKenzie
25123, Hess, Blue Buttes-Madison, NDIC commission to review the TA status of a specific well, McKenzie
25124, Hess, Beaver Lodge and Capa-Bakken, establish two overlapping 2560-acre units, 1 wells on each unit, and 6 wells on a 1280-acre unit, Williams County
25125, Hess, Alkali Creek-Bakken, establish an overlapping 2560-acre unit, 1 well; and 11 wells to be drilled on a 1280-acre unit, Mountrail
25126, NP Resources, Elkhorn Ranch-Bakken, establish 13 1280-acre units, 4 wells on each; create two stand-up 640-acre units, 2 wells each; Billings
25127, SM Energy, Whiteaker-Bakken, pooling, Divide
25128, SM Energy, Moraine-Bakken, pooling, Divide
25129, SM Energy, Skabo-Bakken, pooling, Divide
25130, SM Energy, Skabo-Bakken, pooling, Divide
25131, Hess, Beaver Lodge-Bakken, pooling, Williams
25132, Hess, Beaver Lodge-Bakken, pooling, Williams
25133, Hess, Capa-Bakken, pooling, Williams
25134, Hess, Alkali Creek-Bakken, Mountrail
25135, BR, Elidah-Bakken, authorize 7 wells on a 1280-acre unit; 10 wells on a 1280-acre unit; and 2 wells on an overlapping 2560-acre unit, McKenzie
25136, BR, Westberg-Bakken, pooling, McKenize
25137, BR, Westberg-Bakken and/or Elidah-Bakken, pooling, McKenzie
25138, BR, Westberg-Bakken and/or Elidah-Bakken, pooling, McKenzie
25139, BR, Elidah-Bakken, pooling, McKenzie
25140, BR, Elidah-Bakken, pooling, McKenzie
25141, BR, Dimmick Lake-Bakken and/or Elidah-Bakken, pooling, McKenzie
25142, BR, Elidah-Bakken, pooling, McKenzie
25143, HRC, Antelope-Sanish, pooling, McKenzie
25144, HRC, Antelope-Sanish, pooling, McKenzie
25145, HRC, Antelope-Sanish, pooling, McKenzie
25146, HRC, McGregory Buttes-Bakken, pooling, Dunn
25147, HRC, McGregory Buttes-Bakken, pooling, Dunn
25148, HRC, McGregory Buttes-Bakken, pooling, Dunn
25149, MRO, commingling
25150, MRO, commingling
25151, MRO, commingling
25152, Petro Harvester Operating Co, SWD

Thursday, July 28, 2017
8 pages 

25153, WPX, Reunion Bay-Bakken, establish an overlapping 1280-acre unit, 8 wells; establish two 1280-acre units, 8 wells on each; Mountrail, Dunn counties
25154, risk penalty legalese involving CLR and Vintage Oil
25155, CLR, Antelope-Sanish, establish two overlapping 2560-acre units; 1 well, McKenzie
25156, CLR, Rattlesnake Point-Bakken, several wells with exceptions to siting rules, Dunn
25157, CLR, CLR, Rattlesnake Point-Bakken and/or Jim Creek-Bakken, establish two overlapping 2560-acre units; 1 well each; estabish an overlapping 2560-acre unit, two wells; Dunn
25158, CLR, Oakdale and/or Corral Creek-Bakken, establish an overlapping 2560-acre unit, 2 wells; Dunn
25159, Lehigh-Bakken, proper spacing, Stark County
25160, Crescent Point Energy, Little Muddy-Bakken, establish an overlapping 1200-acreunit; 6 wells; amend the number of wells on an existing 1280-acre unit from seven wells to one well, Williams County
25161, EOG, Parshall-Bakken, establish an overlapping 1920-acre unit, multiple wells, Mountrail
25162, Newfield, Westberg-Bakken and/or Keene-Bakken/Three Forks, establish an overlapping 2560-acre unit, 1 well; McKenzie
25163, Newfield, Lost Bridge-Bakken establish an overlapping 2560-acre unit, 1 well, Dunn County
25164, XTO, Siverston and/or North Fork-Bakken, establish an overlapping 1920-acre unit, 3 wells; establish an overlapping 3840-acre unit, 1 well, McKenzie
25165, XTO, Lost Bridge-Bakken, establish an overlapping 1920-acre unit, 8 wells; establish an overlapping 3840-acre unit, 1 well, Dunn
25166, Liberty Resources, McGregor-Bakken, reasonable costs and expenses from Vitesse Energy, Williams
25167, Newfield, Lost Bridge-Bakken, pooling, Dunn
25168, Crescent Point Energy, Little Muddy-Bakken, pooling, Williams
25169, Sinclair, risk penalty legalese
25170, Sinclair, risk penalty legalese
25171, CLR, Jim Creek-Bakken, 28 wells on an existing 2560-acre unit, Dunn
25172, CLR, Elm Tree-Bakken, pooling, McKenzie, Mountrail
25173, CLR, Elm Tree-Bakken, pooling, McKenize
25174, CLR, Elm Tree-Bakken, pooling, McKenzie, Mountrail
25175, CLR, Sanish-Bakken, pooling, McKenzie, Mountrail
25176, CLR, Antelope-Sanish, pooling, McKenzie
25177, CLR, Antelope-Sanish, pooling, McKenzie
25178, CLR, Antelope-Sanish, pooling, McKenzie
25179, CLR, Oakdale and/or Corral Creek Bakken, pooling, Dunn
25180, CLR, Rattlesnake Point-Bakken, pooling, Dunn
25181, CLR, Rattlesnake Point-Bakken, pooling, Dunn
25182, CLR, Rattlesnake Point and/or Jim Creek-Bakken, pooling, Dunn
25183, XTO, flaring
25184, Liberty Resources, McGregor-Bakken, 8 wells on an existing 640-acre unit; Williams;
25185, Statoil, commingling
25186, EOG, commingling
25187, SWD

A Random Update Of Corral Creek Oil Field -- June 30, 2016

Two BR wells come off the confidential list today. One of them is a Zephyr well in the unitized Corral Creek oil field.

I thought it might be interesting to take a look at the Corral Creek oil field.

Two screenshots. The first shows most of the Corral Creek oil field. Note that there are no active rigs in the field:



The second screen shot provides a better view of the extended reach horizontal wells. Note the relationship of a series of wells to State Highway 22. Once the wells were completed, the land was reclaimed between the highway and the pads to provide greater separation (250 feet) than required (200 feet):



I picked out #28352 at random from the GIS map server. This BR-CCU well was drilled back in 2015. The file report for this well contains some nice information for those interested in the Corral Creek oil field:
  • 28352, 2,445, BR, CCU Pullman 1-8-7TFH, Corral Creek, t2/15; cum 120K 5/16, the file report contains BR's 2014 plan for developing the Corral Creek;
The file report provides some interesting reading.

In addition, note the variability of production from this well. Look at the amount of production over 13 days in December, 2015, for example:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN5-20161947954727333345174290172
BAKKEN4-2016243585382024573530341351
BAKKEN3-201624116571140073081073410398267
BAKKEN2-20165107910541037157315590
BAKKEN1-2016003610000
BAKKEN12-20151310997107862270344834100
BAKKEN11-201530925692395558969095985
BAKKEN10-201531108521072477201106910411571
BAKKEN9-201512973364646005970
BAKKEN8-20152210159102266857952673272137
BAKKEN7-20153116908169671204715386123852914
BAKKEN6-2015301737917513113291673416273379
BAKKEN5-20153118764184731423918681137334859
BAKKEN4-201511206617017
BAKKEN3-20150000000
BAKKEN2-20153430443044420596605958

We Start The Day With 30 Active Rigs; RBN Energy Has A Nice Update On LNG Liquifaction Capacity -- June 30, 2016

Active rigs:


6/30/201606/30/201506/30/201406/30/201306/30/2012
Active Rigs3076191189215

RBN Energy: competition, low prices unsettling the LNG market. Great update.
Only eight years ago U.S. natural gas prices were spiking, domestic gas production was declining, and much of the market was anticipating a boom in LNG imports to the U.S. from Qatar and other major suppliers.
Now, pipelines are being reversed to bring gas from the Marcellus and Utica basins to Gulf Coast to be super-cooled into LNG, and LNG from the first liquefaction/LNG export facility in the Lower 48 (Train 1 at Cheniere Energy’s Sabine Pass in southwestern Louisiana) is being shipped to overseas buyers. (Train 2 at Sabine Pass is in the process of being started up.) But the market expectations on which the development of new liquefaction capacity at Sabine Pass, Cameron LNG, Corpus Christi LNG (another Cheniere project), Freeport LNG, and Dominion’s Cove Point were founded have been shaken to their core.
Recent spot prices for LNG (around $5/MMBtu—75% lower than where prices stood two and a half years ago) suggest that the world is awash in LNG. Worse yet, it is possible (but by no means certain) that during the 2016-20 period worldwide liquefaction capacity (for super-cooling/condensing natural gas into very transportable LNG) will rise to 448 million tons per annum (MTPA) from the 308 MTPA online at year-end 2015, a 45% increase in less than five years.
EOG in the Permian. SeekingAlpha. Nice update.

XOM, Guyana. An "elephant find"? ExxonMobil says the company plans to release the results of the Liza-2 well "by mid-year." According to an analyst, if the headlines prove accurate, Liza-1 and Liza-2 could confirm meaning reserves and production uplift for ExxonMobil and its partners well above the initial industry reserve estimates of 700 million bbls of oil.  Data points:
  • Liza-1, Stabroek Block, 120 miles offshore Guyana
  • the seam is 295 feet thick
  • oil-bearing sandstone
  • 17,825 feet in almost 6,000 feet of water
  • spud March 5, 2015
  • Esso and Production Guyana (45%); Hess Guyana (30%), CNOOC Nexen Guyana (25%)
Wind farm, Norway, Google. Data points:
  • yet to be built; on-line by late 2017
  • 160-MW capacity; will be largest wind farm in Norway
  • to provide power for Google's data centers
  • on-shore Tellenes wind power farm south of Stavanger 
The Market. Late in the day, 307 new 52-week highs; 16 new 52-week lows. New highs include:
ATT (a big whoop); Chevron, Duke Energy, Hershey, JNJ, Kellogg, Murphy USA, SRE (another huge whoop).

Note: this is not an investment site. Do not make any investment, financial, travel, relationship, or job decisions based on what you read or think you may have read at this site. It just helps me put things into perspective. 

Wednesday, June 29, 2016

80% Drop In Libyan Oil Production "Not Good News" For Libya -- Bloomberg -- June 29, 2016

Bloomberg study suggests that an 80% drop in Libya's oil output is "not good news" for the country.

I cannot make this stuff up.

From Rigzone:
Ongoing militant attacks on hydrocarbon installations in Libya have helped stem the production of oil in the country to well below pre-2011 output levels.

“Such activity, in combination with oil embargos, has contributed to an 80 percent fall in national oil output since 2011,” said Ruth Lux, a senior consultant within JLT’s credit, political & security risk division consulting team.

For most of the last two years, oil production in Libya has been stuck at around 300,000 to 400,000 barrels per day (bpd).

This output drop is not good news for the country considering it’s one of the most dependent oil economies in the world, according to a study by Bloomberg released in January.
"Not good news" for Libya -- that its crude oil production has dropped 80% since 2011. Well, duh.

Follow-Up To The Stranded BP Tanker -- June 29, 2016

Does anyone remember this story from June 1, 2016?
Reuters is reporting:
Four tankers carrying over 2 million barrels of U.S. crude are stuck at sea and cannot discharge at a Caribbean terminal because Venezuela has not yet paid supplier BP.
The cargoes are part of a tender [Venezuela] awarded in March to BP and China Oil.
The deal was to import some 8 million barrels of West Texas Intermediate (WTI) crude so Venezuela could dilute its extra heavy crudes and feed its Caribbean refineries.
So, how did that turn out?

Reuters reports that a "swap" resolved the issue:
Britain's BP Plc this month received a Venezuelan crude cargo from state-run PDVSA, the first since the companies agreed on a swap arrangement to settle pending payments for U.S. oil shipments.
BP and China Oil won a tender launched by PDVSA in March to be supplied with U.S. and African light oil during the second quarter of this year. The light oil is needed to dilute Venezuela's extra heavy output and for processing at Caribbean refineries.
After cash-strapped PDVSA did not make payments on time, BP in May halted further discharges of cargoes of U.S. crude at the port of Curacao.
Then a swap agreement was reached involving deliveries of Venezuelan oil to BP as payment for the U.S. crude.
Aframax tanker Grimstad, chartered by BP and carrying some 500,000 barrels of Venezuelan Merey crude, arrived in Pascagoula Anchorage and Lightering Area in the U.S. Gulf Coast on June 11. It has been waiting to discharge since then.
BP has not had access to Venezuelan crude since 2013, when its unit TNK-BP sold its stake in a crude upgrader at the Orinoco belt to Russia's Rosneft.
BP still needs to receive more cargoes from PDVSA to cover all payments it is owed and this is why several BP tankers have still yet to unload in Curacao, according to traders.
As of June 29, 2.05 million barrels of U.S. crude in three tankers are still waiting to unload, while a fourth cargo entered PDVSA's Bullenbay terminal in Curacao this week to start delivering.
So, who's on first?

No New Permits -- June 29, 2016; Pioneer To Add Rigs In The Permian; Texas Oil And Gas Companies "Starting To Turn The Corner"

Gasoline demand, for the week ending 6/24/16: 9.709 million bopd; compared to a year ago of 9.731. Hmmmm. However, the four-week average, recent: 9.714 million bopd compared to 9.541 a year ago.

Active rigs:


6/29/201606/29/201506/29/201406/29/201306/29/2012
Active Rigs3077191189215

Wells coming off confidential list Thursday:
  • 30281, SI/NC, BR, Merton 21-15MBH, North Fork, no production data,
  • 32003, SI/NC, BR, CCU Zephyr 34-34 TFH, Corral Creek, no production data,
No new permits.

Nine permits renewed --
  • Petro-Hunt, LLC (8), eight USA permits in section 1-153-95, McKenzie County
  • MRO, one Stark permit in Mountrail County
Marathon canceled three permits: a Rohde, a Litvin, and a Cross permit, all in Dunn County.

Rigs. Some time ago I suggested that when the rig count starts to go up in the Bakken it will be in small increments as small operators bring back their "one" rig; the larger operators can do a lot of drilling with what they have, and they still have a huge backlog of inactive wells and DUCs. there may be exceptions (and I may be completely wrong). Oilprice.com is reporting that Pioneer Natural Resources will increase the number of its rigs from 12 to 17 in the Permian:
Pioneer Natural Resources said in an updated 2016 outlook issued in June that it would increase its horizontal rig count from 12 to 17 rigs in the Permian basin in the second half of the year. Pioneer will add the first rig in September, with plans to follow that up with an additional two rigs in each of October and November. Those rigs will begin drilling and see initial production in early 2017.
Going from 12 to 17 is quite a jump. Pioneer Natural Resources has recently been in the news quite a bit lately. As recently as June 16, 2016, there was a story that PDX paid around $15,000 acre in the Permian.

Also, there's a tweet out today that suggest oil and gas operators in  Texas "are starting to turn the corner."

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Fascinating Article On Atmospheric CO2

From Forbes
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A Note For The Granddaughters

For those of you who have a copy of The Sagas of Icelanders (all two of you) with the preface by Jane Smiley and the introduction by Robert Kellogg, you may be interested to know that Nancy Marie Brown has a new book out. These two books arrived today from Amazon:
  • Ivory Vikings: The Mystery of the Most Famous Chessmen in the World and The Woman Who Made Them, Nancy Marie Brown, c. 2015
  • Song of the Vikings: Snorri and the Making of Norse Myths, Nancy Marie Brown, c. 2012
If one enjoys JRR Tolkien and/or The Lord of the Rings, the Norse myths are quite rewarding.

Today, while talking about these books to our older granddaughter on the way home from sailing camp, "Lara's Theme" (a Dr Zhivago soundtrack/CD) began to play. I mentioned that some songs are so incredible (for lack of a better word) one has trouble imagining that they were actually written by a human. Some songs seem like they have been here forever, and existed prior to humanity, perhaps written by angels.

Arianna mentioned that another song that would fit that category was the basis for a "fan fiction" book (I assume this is the book). The song was "We'll Meet Again," made famous, I guess by Vera Lynn. Arianna has that song on her iPhone playlist and is one of her favorites.

Mine, too. I have trouble not tearing up when I hear it, and thinking of ....

We'll Meet Again, Vera Lynn

John Kemp Is Back! Mid-Week Energy Tweets -- June 29, 2016

US gasoline consumption (implied) averaged 9.7 million b/d over last 4 wks, seasonal record, and up +173,000 on 2015 -- sets new record

US distillate consumption averaged 3.8 million b/d over last 4 weeks, very close to 2015 and 10yr avg levels 
 
US distillate stocks adjusted for consumption continue to fall rather than rise as oversupply worked down

US distillate stocks fell -1.8 million bbl to 151 million bbl last week, just +14.7 million bbl (+10.8%) above 2015

US refinery throughput rose +190,000 b/d to a new seasonal record of 16.695 million b/d (up +164,000 b/d on 2015). It would be interesting to know how much of this is related to a) the French refinery strikes; and, b) the Venezuela debacle.

US gasoline stocks adjusted for consumption edged up to 24.6 days, versus 22.7 days in 2015 and 10yr avg 22.9 days.

US gasoline stocks rose +1.4 million bbl to 239 million bbl, and now +22 million bbl (+10%) over 2015 level -- by the way, a new graph is needed -- the current numbers are practically off the historical graph.

US crude oil imports returned to more normal 7.6 million b/d last week from the elevated 8.4 million b/d in prior week.

US commercial crude oil stocks fell -4.1 million bbl to 527 million bbl last week, but a new graphis still needed. Current data is almost off the historical graph

US commercial crude stocks fell more heavily than usual with YoY surplus down from +68 million to +61 million bbl

Update On Chinese Crude Oil Imports -- RIgzone -- June 29, 2016

The writer argues that jump in Chinese crude oil imports may be due to rapid filling of their strategic petroleum reserve and increasing refinery operations for export, rather than an overall increase in demand due to domestic growth in GDP.

Some data points from the article:
  • China: world's #2 consumer of crude oil
  • imports rose 16.5% in the first five months of this year compared to same period last year
  • three reasons cited
    • domestic crude oil production falling; dropped over 7% in May
      • produced about 4 million bopd in the January - May period; a drop of about 170,000 bopd from 2015
      • therefore: 170,000 bopd of the additional 1 million bopd import increase due to decrease in local production
    • filling strategic storages at a fairly rapid pace (locking in great prices while they can)
      • estimate: about 1 million bopd went into either commercial or strategic storage
    • third factor: rising exports of refined products
      • diesel exports surged over 300%
      • gasoline exports surged almost 65%

Some Business News, Less Than A Week After Brexit -- June 29, 2016

Updates

June 30, 2016: now we know why Walmart went with a month of free-shipping. Walmart is doing this in anticipation of Amazon setting July 12, 2016, as Prime Day -- a one-day sale exclusively for members of its Prime subscription shopping service. 
 
Original Post
 
Some business news, without links, easy to find:
  • US pending home sales fell almost 4% in May; a sign of slowing in the US housing market
  • Walmart will give everyone a full month of free shipping; a free 30-day trial
  • because of Brexit, the world's second largest telecom, Vodafone, may move its headquarter out of the UK
The market: up again today; the Brexit vote was June 23, 2016. Some highlights:
  • T, at new highs, it appears, trading about $42.45
  • SRE, flirting with new highs, it appears, trading about $111.00
  • MDU, down a bit, but still doing well at $23.27
  • TSLA, investors coming back in, trading up 2.4%; now back over $206
That's ll folks -- the Brexit crisis is over -- Yahoo!Finance:
On June 17, six days before the Brits voted to leave the European Union, the S&P 500 index closed at 2,071. Today, the S&P index continued to surge, closing at ... drum roll ... 2,070.77, which when rounded takes us to 2,071. The Dow, up almost 300 points, to close at almost 17,700. On the Dow, there were 299 new 52-week highs, including my favorite, (LOL), ATT; there were 11 new 52-week lows.

Update On Oilfield Expansion Projects In Saudi Arabia -- June 29, 2016

Aramco, SABIC sign pact on new plant -- Bloomberg video. Previously posted. This is part of Prince Salman's "Vision 2030" plan. Previously posted. Not only is there nothing new, so far this is simply "talk." The video: lots of talk; little information.

Khurais Oil Field
Adjacent To The World's Largest Oilfield, The Ghawar Trend
Khurais Megaproject

This project was initially proposed to be completed by 2017, then pushed back to 2018, and it appears this project is now pushed back to be completed no sooner than late 2019.

Wiki.

From the June 27 - July 3, 2016 issue of Oil & Gas News:
Saudi Aramco is expected to make a decision in June whether to go ahead with the $3- billion Khurais oilfield expansion project in the Eastern Province under the present market conditions.

The company is currently locked in negotiations with Saipem, the engineering, procurement and construction (EPC) contractor for the $2-billion central processing facilities (CPF) package, with a view to lowering project costs, decelerating construction works and better cash flow management.

However, Aramco has also said that if substantial cost savings are not possible after the engineering phase is completed, it could cancel the whole project. The engineering work is now being undertaken by Saipem. The current slow-down in works has also extended the completion deadline to late 2019.

The Khurais Arabian Light Crude Increment project, as it is also known, is an onshore oilfield development which was initially discovered in 1957. By 2009, the central procession facility at Khurais had a processing capacity of 1.2 million barrels per day (bpd) of oil and 320 million cu ft per day (cfd) of associated gas, as well as 80,000 bpd of natural gas liquids. 
From March 30, 2016, Bloomberg:
Saudi Arabian Oil Co. is pressing ahead with an expansion of the Khurais oil field despite lower crude prices and plans to double its production of natural gas over the next 10 years.
The world’s biggest oil exporter, known as Saudi Aramco, won’t cancel any oil, gas or refining projects, Amin Nasser told reporters during a conference in Al-Ahsa in eastern Saudi Arabia. Aramco is also studying a possible expansion of the country’s largest oil refinery, Ras Tanura, which has a capacity of 550,000 barrels a day.
“Until now all of our downstream and upstream projects are continuous,” Nasser said. “No project in our programs got canceled.”
From November 8, 2015, TradeArabia:
Saudi Arabia is moving ahead with the expansion of its giant Khurais oilfield but the project would move slower than originally planned because of budgetary reasons.
Since global oil prices fell sharply last year, national oil company Saudi Aramco has slowed some projects, shelving less important ones and asking for discounts on some contracts which it had awarded. The project plans to raise Khurais' output by 300,000 barrels per day (bpd) to 1.5 mbpd, and allow it to produce 143 million standard cubic feet per day of associated gas and 34,000 bpd of natural gas liquids.
The original time frame to complete the expansion was 2017.
Industry sources told Reuters in September that Khurais expansion was delayed.
Now Saudi-based industry sources say Khurais expansion is still on but will take longer than expected, with possible completion in 2018. "Khurais is going ahead but not as fast because of the budget," one industry source said. 
From September 3, 2015, ConstructionWeek:
The expansion of Saudi Arabia's Khurais oilfield is likely to be delayed from its originally planned timeframe of 2017. 
Consequently, the start-up date of the project is now unclear. 
Plummeting global oil prices are being attributed for the delay, despite the absence of official comment on the development.
Undated, but probably mid-2009, from Hydrocarbons-Technology:
The Khurais oilfield development was the largest of several Saudi Aramco projects intended to boost the production capacity of Saudi Arabia's oilfields from 11.3 million bpd to 12.5 million bpd by 2009.
The Khurais project as a whole covers three oilfields: Khurais, Abu Jifan and Mazalij. The Khurais field, with an area of 2,890km² and 127km long, located about 250km south-west of Dhahran and 300km north south-east of Riyadh, is the biggest in the project. Abu Jifan covers 520km² south-west of Khurais and Mazalij covers 1,630km² south-east of Abu Jifan.
In 2009, the project added 1.2 million bpd of high-quality Arabian light crude to Saudi Arabia's export capacity. The Khurais programme also increased the capacity of the Qurayyah seawater injection system by 4.5 million bpd of treated water for injection at the Khurais and South Ghawar fields in 2008. The total project cost is estimated to be about $10bn.
The drilling was completed in February 2009, ten months ahead of the scheduled three-year duration. Production at the oilfield began on 10 June 2009. 
Khurais is located on a large structural trend to the west of, and parallel to, the Ghawar trend.
Because of this superficial resemblance to Ghawar, there were high hopes that the Khurais reservoir would be comparably large; however, it turned out that it was much smaller and not as high quality as Ghawar, though it is still the largest of the proposed projects.
Variable reservoir quality had also been a problem at Khurais. Pilot-scale production at Khurais began in 1963, but the field was never fully developed. It produces Arab light crude.
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Shaybah Oil Field
A Super-Giant Oil Field In Saudi Arabia 

Wiki 

From April 25, 2016, Bloomberg:
Saudi Arabian Oil Co. will complete the expansion of its Shaybah oilfield by the end of May, 2016, allowing the biggest crude exporter in the world to maintain its total production capacity, according to two people with knowledge of the plan.
Shaybah’s output capacity will rise to 1 million barrels a day from 750,000 barrels, said the people, who asked not to be identified because the information isn’t public.
The field, in the Empty Quarter desert near the border with the United Arab Emirates, produces extra light grade crude with an API gravity of 42 degrees, they said.
Shaybah’s expansion will help Saudi Aramco, as the state producer is known, keep the company’s capacity at 12 million barrels a day, they said. 
From June 25, 2015, ArabNews:
As part of Saudi Aramco’s mega projects, it is implementing expansion plans at Shaybah field in the Empty Quarter to increase oil production capacity and natural gas liquids (NGL) at an estimated cost of SR186.75 billion. Saudi Aramco's joint projects in the field of refining and petrochemical production are estimated at SR131.25 billion. 
The Shaybah field expansion focuses on two major projects. First is oil production increase by 250,000 barrels per day (bpd), for the second time. The expansion will provide the Shaybah field with a capacity of 1 million bpd of Arabian Extra Light crude oil by April, 2016, double its initial capacity in 1998.
Moreover, the Saudi oil company is working to improve the design of wells to increase the average reservoir contact to 10 km, enhancing production from the deep, tight faces of the reservoir.
As for the second project, Saudi Aramco will construct a new NGL plant, to meet the growing demand for petrochemical feedstock through the extraction of high value NGL of the produced gas, which is expected to begin in the second quarter of 2015.
The NGL plant project also includes a major upgrade to increase the power generation capacity to more than 1 GW by installing four cogeneration units, seven single cycle units, and a 50 km transmission line with the ability of 230 kilovolt.

Starting The Day With 30 Active Rigs -- June 29, 2016; BLM Ready To Okay 6,000 More Wells In Utah -- Moab/Paradox Basin

Active rigs:


6/29/201606/29/201506/29/201406/29/201306/29/2012
Active Rigs3077191189215

RBN Energy: evaluating economics of a new natural gas pipeline - part 4.

Strippers: from the EIA today --
Stripper wells, or wells that produce small volumes, represent an important but decreasing share of total U.S. oil and natural gas production. These wells are characterized as producing no more than 15 barrels of oil equivalent per day (boe/d) over a 12-month period.
EIA estimates that there were about 380,000 stripper oil wells (so called because they are stripping the remaining oil out of the ground) in the United States operating at the end of 2015, compared to about 90,000 nonstripper oil wells. --- EIA
Moab, Utah: BLM poised to okay almost 6,000 new wells for Newfield over 16 years; directional and vertical wells.
Under the BLM's preferred alternative, Newfield Exploration Co. would, over a period of 16 years, drill all 5,750 oil and gas wells it proposed. That plan relies on directional drilling to reduce the project's footprint in an already affected field covering 119,000 acres south of Myton.
The infill project is needed to recover remaining oil and gas with new wells and by injecting water into hydrocarbon-bearing formations to coax further production over the 40- to 50-year life of the project.
Utah's largest oil producer, Newfield already operates about 3,400 wells there, on 40-acre spacings. By drilling many new wells from existing pads, the infill project would concentrate its impacts to spots already served by existing roads and pipelines. These provisions are needed to protect habitat and the Pariette Wetlands.
Other data points:
  • no sage grous in this particular are
  • two rare species of cactus
  • prairie dogs (which have been doing directional burrowing without BLM permission) 
I track the Moab / Paradox Basin here.

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Iran's Rate Of Growth In Crude Oil Production Is Slowing

From a SeekingAlpha  contributor (archived):
Summary:
  • A major part of the fall in oil prices last year was driven by concerns over the rising production levels of Iran.
  • Analysts reassured the markets that it would take a couple of years for Iran to get production back to pre-sanctions levels.
  • Iranian oil production has rebounded much faster than many analysts ever anticipated as the chart below shows.
Iranian oil production has rebounded much faster than many analysts ever anticipated as the chart below shows. At this point, Iran is roughly back to pre-sanctions production levels. Score one against analysts who expected the process to take years.
The result is that there's probably very little additional crude that's going to come online from Iran. The country already is pumping as fast as it can, and frankly its post-sanctions export program has been at best minimally successful. Again, this is a ding on conventional wisdom that suggests Iran's production would have a significant impact on the market share of other major oil producers.
This is probably a large part of what has driven Saudi commentary that the oil glut has disappeared.
Iran believes it can move from producing 3.5 million barrels per day (mb/d) in May to 4.8 mb/d by 2021, but to do that the country needs $70 billion in foreign capital to hit the target.
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Update On The Khurais Oilfield In Saudi Arabia
The Tea Leaves Continue To Swirl 
From the June 27 - July 3, 2016 issue of Oil & Gas News:
Saudi Aramco is expected to make a decision in June whether to go ahead with the $3- billion Khurais oilfield expansion project in the Eastern Province under the present market conditions.

The company is currently locked in negotiations with Saipem, the engineering, procurement and construction (EPC) contractor for the $2-billion central processing facilities (CPF) package, with a view to lowering project costs, decelerating construction works and better cash flow management.

However, Aramco has also said that if substantial cost savings are not possible after the engineering phase is completed, it could cancel the whole project. The engineering work is now being undertaken by Saipem. The current slow-down in works has also extended the completion deadline to late 2019.

The Khurais Arabian Light Crude Increment project, as it is also known, is an onshore oilfield development which was initially discovered in 1957. By 2009, the central procession facility at Khurais had a processing capacity of 1.2 million barrels per day (bpd) of oil and 320 million cu ft per day (cfd) of associated gas, as well as 80,000 bpd of natural gas liquids. 
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In Politics As In Sports, Timing Is Everything
Peaking Too Soon

At least one poll shows Trump and Hillary in a dead heat.

From The New York Times, an op-ed by Bernie Sanders: Dems need to wake up.
Surprise, surprise. Workers in Britain, many of whom have seen a decline in their standard of living while the very rich in their country have become much richer, have turned their backs on the European Union and a globalized economy that is failing them and their children.
And it’s not just the British who are suffering. That increasingly globalized economy, established and maintained by the world’s economic elite, is failing people everywhere. Incredibly, the wealthiest 62 people on this planet own as much wealth as the bottom half of the world’s population — around 3.6 billion people. The top 1 percent now owns more wealth than the whole of the bottom 99 percent. The very, very rich enjoy unimaginable luxury while billions of people endure abject poverty, unemployment, and inadequate health care, education, housing and drinking water.
Could this rejection of the current form of the global economy happen in the United States? You bet it could.
During my campaign for the Democratic presidential nomination, I’ve visited 46 states. What I saw and heard on too many occasions were painful realities that the political and media establishment fail even to recognize.
In the last 15 years, nearly 60,000 factories in this country have closed, and more than 4.8 million well-paid manufacturing jobs have disappeared. Much of this is related to disastrous trade agreements that encourage corporations to move to low-wage countries.
His "facts" may or may not be accurate. His plan for fixing the problems are dead wrong. 

Tuesday, June 28, 2016

Reason #239 Why I Love To Blog: Indications That Prince Salman's Strategic Plan Is To Focus More On Midstream/Downstream; Less On Upstream

Updates

Later, 9:14 p.m. Central Time: Look at the blurb from The Oil & Gas Journal in the original post below. Think about it for a minute. "A fully integrated crude oil-to-chemicals complex in Saudi Arabia." Prince Salman is not thinking of a simple complex; he's going for a world-class, record-setting facility. But that requires cash. Lots of cash. And with oil at $50 his country continues to hemorrhage cash on a monthly basis.

In an earlier post, his energy minister was quoted as saying that he plans / Saudi plans to let KSA crude oil inventories to continue to decline. Once the data comes out showing how far KSA crude oil inventories have fallen, there's a very, very good chance the price of oil could spike.

Idle chatter.

Original Post
 
Earlier today I updated "Trending" over at the "Top Ten Lists."

The first thing I posted was something I have been alluding to for the past week or so and finally said it outright, so it cannot be mistaken:
1. There are indications that Saudi Arabia has changed strategy; will focus on refining; will not increase production; will concentrate on Prince Salman's plan with greater emphasis on midstream, downstream; less emphasis on upstream
Now this, from The Oil & Gas Journal which I just came across, posted over at Twitter, six hours ago:
Saudi Aramco and Saudi Arabian Basic Industries Corp. (SABIC) plan to conduct a joint feasibility study for development of a fully integrated crude oil-to-chemicals complex in Saudi Arabia.

The proposed plant would use a crude oil-to-chemicals process derived from improved refining technology that mixes innovative configurations with proven conversion technologies to create an integrated petrochemical complex capable of maximizing chemical yield, transforming and recycling byproducts, driving efficiencies of scale and resource optimization, and diversifying Saudi Arabia’s petrochemical feedstock mix, the companies said.

Pending a positive outcome of the study, Aramco and SABIC plan to establish a joint venture to advance the project, which if approved, would fulfill Saudi Vision 2030 goals for the downstream sector.
That second paragraph .... "mixes innovative configurations ... yada, yada, yada ...." sounds like it was written by:
a) MuskMelon
b) any recent Harvard MBA grad
c) former CEO of Shell
d) Bill Gates

Exxon's Global Energy Demand Forecast Through 2040 -- For The Archives -- June 28, 2016

For the archives: global energy demand forecast.

This graphic is in line with about almost everything else I see.


Observations:
  • energy: all the above -- everything is represented here
  • the graph goes out to 2040
  • this is global energy demand
  • coal: the amount actually increased significantly from 2000 to 2015, and really doesn't decrease all that much (if it does, its almost imperceptible)
  • natural gas: the huge winner -- compare 2040 with 2015 (or 2000, for that matter)
  • oil: even oil shows a huge increase
  • nuclear: increases some (China? India? where?)
  • other renewables (wind/solar): although there's a relative increase, it looks like about 25 quadrillion BTUs/700 quadrillion BTUs = 3.57%. I.N.C.O.N.S.E.Q.U.E.N.T.I.A.L. A rounding error at best.
By the way:
  • 2015: 575 quadrillion BTUs
  • 2040: 700 quadrillion BTUs
  • (700 - 575) / 575 =  22% increase in global energy demand over the next 25 years.
Note: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on what you read here. But this seems to be an open-book test when it comes to looking where to invest for the long term. 

There is no question that solar has some niches (wind has none, absolutely zero) but as a real global player, unreliable, expensive, non-dispatchable energy is irrelevant.