Friday, August 5, 2016

Williams County Building Permit At 220 2nd Avenue East? Old MDU Building? -- August 5, 2016

I cannot thank a reader enough for taking time to provide update and links regarding new construction in Williston. I am duplicating a screenshot and placing it here, temporarily, so that it shows up as a thumbnail in the appropriate locations.



Updates

August 6, 2016: see first comment (and reply):
Yes, Williams county is renovating the old MDU building and attaching a new 3 story office building to it. This link shows the rendering: http://jlgarchitects.com/work/civic-public/williams-county-mdu-renovation.
You will also be seeing a 35 million permit in the next couple months, I believe. Mountrail Williams Electric is replacing their current office with a new 4 story. It will be out for bid mid August. See this link: http://jlgarchitects.com/work/corporate/mountrailwilliams-electric-cooperative
$35 million is not trivial. Not even in the Bakken.

Screen shot of that intersection as it looks now, looking directly east down east Broadway. The "old" MDU building, now the Williams County Administrative Building (CAB) is the low one-story to the right, on the southeast corner, I guess. The three story structure on the left is the Williams County District Court:



Proposed new Williams County Administrative Building:


From the JLG site:
The goal of the project is to provide much needed administrative space with the purchase and addition to the old MDU building (20,000 SF).
In addition to revamping the old MDU building and a three story addition (28,896 SF), the project is also focused to connect the Williams County Buildings downtown to create a true ‘campus’ feel.
This added office space also is paralleled by the need to add more courtrooms to the original Williams County Courthouse that is across the street. The Courthouse 10,000 SF renovation project will add several courtrooms and improve efficiency by the relocation of Municipal Court and the Court Clerks to the main level.
As long as we are it, here's a screenshot of the proposed Mountrail-Williams Electric Co-op's new building. I believe this will be located at the co-op's present location, on the west side of Highway 2 north of Williston, across from Spring Lake Park:


Original Post
 
JE Dunn has a $13 million construction permit at 220 2nd Avenue East, Williston, North Dakota, June, 2016. I believe this is the "old" MDU building. The permit says the building is now owned by Williams County.

Random Update Of Slawson's Howitzer Federal Well --- August 5, 2016

The file report is not helpful explaining this one, but this well is finally producing. Only 9 stages and only 300,000 lbs proppant:
  • 29859, 15, Slawson, Howitzer Federal 5 SLTFH, Big Bend, 4 sections, 9 stages, 300K, t3/15; cum 32K 6/16; finally starting producing up to expected in 5/16;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN6-20163086848523746567135579984
BAKKEN5-20162810002932376717580739941
BAKKEN4-201620627668618064634362430
BAKKEN3-201611476549884399449925451899
BAKKEN2-201610701123211406656150
BAKKEN1-20165802012212500
BAKKEN12-2015183802079500
BAKKEN11-20150000000
BAKKEN10-20150000000
BAKKEN9-20150000000
BAKKEN8-20150000000
BAKKEN7-20150000000
BAKKEN6-20150000000
BAKKEN5-20150000000
BAKKEN4-201511500500

Bakken Pipeline System: Dakota Access Pipeline + Energy Transfer Crude Oil Pipeline -- August 5, 2016

Bits and pieces of this have been reported all week.

For newbies, the Dakota Access Pipeline that is getting all the attention in Iowa is now part of what "they" are calling the Bakken Pipeline System. This "half" of the system will carry Bakken crude oil from North Dakota to Illinois.

A second leg will carry that oil from Illinois to Texas.

Players involved also suggest that this puts the the Enbridge Sandpiper into question. At current production levels, the Sandpiper is certainly not needed. Enbridge seems to be suggesting that the Sandpiper has now been moved to the back burner while the company re-evaluates.

Bottom line: a lot of folks in Minnesota just got the rug pulled out from underneath them. I hope they weren't counting on that "mailbox money" that would have come their way for decades.

Data points:
  • the Dakota Access Pipeline, North Dakota to Illinois, through Iowa, bypassing Minnesota: $3.7 billion
  • the Energy Transfer Crude Oil Pipeline from Illinois to Texas, $1 billion

Berkshire Hathaway Profit Jumps 25% -- August 5, 2016

Link here.

How did "B" shares do? Up about 2.5% today. This did not set a new high, but it came close at 145 vs a 52-week high of 148, give or take a bit on rounding.

Three New Permits -- August 5, 2016

Active rigs:


8/5/201608/05/201508/05/201408/05/201308/05/2012
Active Rigs3474193183206

Three new permits:
  • Operator: BR
  • Field: Blue Buttes (McKenzie)
  • Comments:
Ten permits renewed:
  • Hess (6): six HA-State permits in McKenzie County
  • XTO (4): four Twin State permits in McKenzie County
One producing well completed:
  • 26903, 516, Petro-Hunt, Marinenko 145-97-30B-31-5H, Little Knife, t7/16; cum -- 

CLR Says It May Have Set World Record Drilling Longest Horizontal Well With One Bit In The World; Drilled In The Bakken -- August 5, 2016

Over at Twitter:
Shale oil producer Continental Resources says it drilled world's longest lateral well in the Bakken at 15,400 ft., or nearly 3 miles.

Comes from the earnings call:
Now before I turn over to John, I would be remiss if I did not point out that our Bakken drilling team continues to achieve new milestones with technology and improved processes. For example, it appears they recently set a new world record for the longest lateral drilled with one bit. The lateral portion of the well was almost 15,400 feet long and was drilled in five days.
The team also set a new company record for drilling a Bakken 2-mile lateral going from spud to TD in just 9.4 days. The 2-mile lateral portion of the well was drilled in an astounding 2.6 days.
These continued improvements in the Bakken team – with these continued improvements, the Bakken team is targeting a completed well cost of $6 million or an enhanced completed 2 mile lateral well down from $6.8 million at year-end 2015. Current cost is estimated at $6.2 million, and I bet they get there by year-end.

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CLR Announces Sale Of Assets

From press release:
Continental announced today it has signed a definitive purchase and sale agreement with an undisclosed buyer to sell approximately 29,500 net acres of non-strategic leasehold in the SCOOP play in Oklahoma for $281 million. The agreement provides for customary closing conditions and adjustments. Located primarily on the eastern side of SCOOP, the leasehold represents approximately 550 Boe per day of net production. After this transaction, the Company will retain approximately 384,000 net acres of leasehold in SCOOP.
In May 2016, the Company announced the sale of approximately 132,000 net acres of leasehold in the Washakie Basin in Wyoming for $110 million.
The SCOOP assets: $281 million / 29,500 acres = $9,500 / mineral acre. That puts the value of the Bakken into perspective.

The Final Nail In The Enbridge Sandpiper Pipeline? -- August 5, 2016

I posted this the other day, that the Sandpiper might be at risk. Yesterday, Reuters reported that Enbridge's Sandpiper looks be latest victim of overbuild.
The long-planned and oft-delayed Sandpiper pipeline through the U.S. Midwest may not be dead, but it appears to be on life support, a likely casualty of the oil-and-gas industry's infrastructure overbuild amid a two-year global oil rout.
After years of delays, refiner Marathon Petroleum Corp and midstream giant Enbridge Inc on Tuesday announced they would scrap their joint venture agreements and transportation services for the 450,000 barrels per day Sandpiper project, instead agreeing to acquire a portion of the rival Dakota Access Pipeline. 
That $1.5 billion deal, if successful, will leave Sandpiper without Marathon as its main anchor, even though an Enbridge spokesman said plans for the line are still being evaluated. The project involves two pipeline legs stretching from North Dakota through Minnesota to Wisconsin.
Outgoing pipeline capacity from the Bakken is currently at around 641,000 bpd, according to Genscape. Once Dakota Access becomes operational, capacity will rise to 1.21 million bpd. 
That projected increase comes against the backdrop of a dramatic decline in oil prices that has weighed on production in North Dakota's Bakken play, one of the biggest beneficiaries of the boom in U.S. shale production over the last several years. 
The Dakota Access Pipeline, slated to stretch from North Dakota to Illinois, is expected to come online in the fourth quarter. With global oil futures down by 70 percent in the last two years, traders and analysts say there just is not enough crude in production in the U.S. Midwest for both pipelines.
In the short term, and possibly even long term, this gives some life to CBR since CBR still provides flexibility in getting oil to the East Coast, but in the big scheme of things, as long as North Dakota production remains around 1 million bopd or less, pipe will be adequate. 

Update On DUCS -- Rystad Energy, CLR -- August 5, 2016

This Rystad Energy article is really pretty cool for a couple of reasons. First, the linked article brings us up to date on DUCs -- the linked article was posted yesterday. Second, it shows again how the North Dakota Industrial Commission took the lead when conditions changes. From the linked article:
By looking at the intentionally postponed (abnormal) part of DUC inventory, Rystad Energy observes that all major liquid basins are exposed to completion delays.
Bakken was the first play where completion delays became visible already in early 2015.
Since then, the abnormal inventory in this play has increased from 150 to 600 wells, thanks to the North Dakota Industrial Commission’s incentive to extend completion delay allowance from 12 to 24 months.
The Eagle Ford and the Permian Basin followed the trend in 2H15 and more than 600 abnormal DUCs have been observed in these plays recently.
At the linked article, note the graphic.

In fact, it appears there may have been a couple of DUCs identified for wells that came off the confidential list in 4Q14, the same quarter that Saudi announced the "surge."

From CLR's 2Q16 conference call:
Our gross operated DUC count in the Bakken has grown to approximately 165 wells and is expected to grow to approximately 190 gross operated DUCs at year end 2016. These DUCs represent a high-graded inventory with an average EUR of approximately 850,000 barrels of oil equivalent per well. We view these DUCs as oil in the bank, and they represent the most cost-effective barrels we have in the company's inventory.
On a cost-forward basis of $3 million to $3.5 million per well, these DUCs should deliver over 100% rate of return at $45 per barrel WTI and $2.50 per million cubic feet of gas.
We plan to continue to build our DUC inventory, and we'll begin completing DUCs as supply and demand rebounce and commodity prices improve.
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Nevada Solar Panels And Net Metering -- Update

From Ecowatch.com:
The Nevada Supreme Court unanimously ruled against a ballot referendum, which could have rolled back a controversial December 2015 regulator decision that lowered payments to rooftop solar customers. The ruling means that the referendum will not be voted on by the public in November.
Several story lines in that article:
  • the journalist framed this as a Warren Buffett - Elon Musk win-lose story (go to linked story)
  • this was reported in a "green" media outlet
  • representative government vs pure democracy
  • the "real" winners are the 99% of Nevadans who don't have solar panels and would have been forced to subsidize inefficient, very costly, nondispatchable solar energy
  • this provides a precedent for other states to at least consider

North Dakota's Legacy Fund Deposits For July, 2016, Have Been Posted -- August 5, 2016

Link here. Through July 2016, total deposits were $3,573,621,493.

I track the Legacy Fund here

In the previous report:
  • June, 2016: $3.8 billion. Schmidt said the Legacy Fund will hold $3.8 billion with the June transfer of $28.3 million.
I cannot explain the July, 2016, "total deposits were $3,573,621,493" vs the June, 2016, summary.

Perhaps The Bismarck Tribune will post an update.

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Mysteries of Terra Firma: The Age and Evolution Of The Earth
James Lawrence Powell
President and Director, LA County Museum of Natural History
c. 2001

I have some handwritten notes on the subject of radioactivity back at the house. I had always planned on transcribing but never got around to it, and probably never will.

Fortunately, it looks like this short book may provide some of the same details that I had in those notes from a different source.

Chapter 1: The Mill of Exquisite Workmanship
  • May 5, 1904: Ernest Rutherford, McGill University, Montreal; addressed Royal Society of London
  • transmutating atoms
  • alchemy
  • "radioactivity": coined by Madame Curie
  • radioactivity set the stage for the atomic physics and quantum mechanics of the 20th century
Chapter 2: Strange Rays ("Beta Rays" and "Alpha Rays")
  • French physicist Antoine-Henri Becquerel (1852 - 1908)
  • his student was Marie Curie
  • she and her husband discovered two previously unrecognized sources of "radioactivity" in pitchblende: one they named polonium, after native home, Poland; they other they named, radium
  • Rutherford's thesis professor, J. J. Thomson; intrigued
  • Rutherford called "negative rays," beta rays which turned out to be electrons discovered by J.J.
  • it took half a century, but Rutherford discovered the nature of "alpha rays"
  • 1898: using thorium, discovered the principle of "half-life"
Chapter 3: The End of the Debate (over the age of the earth)
  • Enough for now.

Reminder: US Energy Revolution" Is Tracked Over At "The Big Stories" -- August 5, 2016

Over at "The Big Stories," under "US Energy Revolution," these are the topics to date:
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The Cancer Page

It's interesting some of the notes I get from readers from posts that have nothing to do with the Bakken. To wit, this link to a very interesting article on a simple-to-understand method to fight some cancers.

It is simple to understand because The New York Times (or someone) uses great graphics to explain what would otherwise be hard to communicate. One can almost skip the entire article and just look at the graphics to understand the science. However, the article, really well written, has a great human back story. Highly recommend. 

NOG Reports Earnings; NOG Cut CAPEX By 50% Year-Over-Year -- August 5, 2016

From their press release:
  • production increased 2.8% sequentially and averaged 13,933 barrels of oil equivalent per day, for a total of 1,267,860 boe 
  • oil and gas sales, including cash from settled derivatives, totaled $62.5 million
  • production expenses, including production taxes, for the second quarter declined 11% per boe compared to the second quarter of 2015
  • capital expenditures totaled $16.5 million during the second quarter, a reduction of 50.5% compared to the second quarter of 2015 
  • quarter-end liquidity totaled $221.7 million, composed of $3.7 million in cash and $218.0 million of revolving credit facility availability
Across the board, Bakken CAPEX has been cut about 50% year-over-year. 

Mike Filloon's Bakken Update: US Wells Costs; Improved Production: 30 Million Pounds oOf Proppant In The Permian -- August 4, 2016

Link here.

[By the way, the 30 million lbs of proppant for a single well has been previously reported on the blog. A big whoop.]

Summary:
  • Well economics continue to improve in all basins with lower well costs and higher initial production numbers
  • Better source rock stimulation creates more fracs per foot, which increases initial production and requires additional proppant and fluids
  • Matador's most recent Permian wells use 3,000 lbs of proppant per foot, or the equivalent of 30,000,000 lbs of proppant per 10,000 foot lateral
From the article:
There are 125 rigs in the Permian, 49 in the Anadarko, 30 in the Eagle Ford (Western Gulf), and 24 in the Bakken (Williston).
The number of rigs is a general representation of economics. The better the economics, the more operators are motivated to put capex to work in that play. This is also why daily production has surged by 83% in the Permian and 75% in the Anadarko since 2012.
The jump in Anadarko production has been quite large from late 2015 to year end. When an operators high-grades, it can either be to better acreage in the same play or another. Operators with acreage in other plays are focusing on the Permian and STACK.
The rest has been archived. 

Thursday's Daily Activity Report Has Been Posted -- August 5, 2016

Active rigs:


8/5/201608/05/201508/05/201408/05/201308/05/2012
Active Rigs3374193183206

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From Thursday's daily activity report:

Three new permits:
  • Operators: Crescent Point Energy (2), CLR
  • Fields: Ellisville (Williams), Jim Creek (Dunn)
  • Comments:
Two permit renewals:
  • Resource Energy Can-Am, a Marshall permit in Divide County
  • BR, a Glacier permit in McKenzie
****************************************

RBN Energy: update on pipeline build-outs in the Northeast; watching sausage being made.

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Other News And Comments

Huge jobs report: expectations, around 190,000. Actual 255,000. Unemployment rate does not change; folks rushing out looking for jobs. Local talk radio says new immigrants taking available jobs offsets any gain that would have dropped the unemployment rate. Regardless, at 4.9%, the US is at full employment. Okay.

The market reaction: up 110 144 151 points in early trading.

US trade deficit: rises $44.6 billion; biggest in 10 months; I didn't read the story but one assumes this is mostly due to strength of the dollar, following Brexit, and perhaps, to some extent, a better US economy. I was wrong. Here's what the AP said:
The U.S. trade deficit increased to the highest point in 10 months, driven up by a big rise in imports of oil and Chinese-made computers, cell phones and clothing.
The deficit rose to $44.5 billion in June, 8.7 percent higher than a revised May deficit of $41 billion, the Commerce Department reported Friday. It was the biggest gap between what America sells abroad and what the country imports since a $44.6 billion deficit last August.
Exports, which have struggled this year because of the strong dollar and global weakness, edged up 0.3 percent to $183.2 billion. Imports rose a faster 1.9 percent to $227.7 billion, led by a 19.4 percent jump in petroleum imports.

Ford sets sales record in China. From SeekingAlpha:
  • Ford  announces it sold 88,189 vehicles in China during July through its joint ventures, up 15% Y/Y. The sales mark was a record for the month
  • The Changan Ford JV sales rose 20% to 69,074 vehicles. Sales for the Jiangling Motor Corporation were up 6% to 17,748 vehicles
  • Ford YTD China sales are up 6% to 652,836 vehicles.
How's my favorite stock doing on a huge "UP" day in the market? TSLA is trading flat; was negative slightly; now in the green slightly. 

At the other end of the spectrum? MDU is slightly negative. 

SRE is struggling: down almost 2%. 

An abbreviated Olympic schedule has been posted at the side bar at the right

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Market At Midday

For a market that exploded on the upside (+150 points on the Dow) after the July jobs report, finding some issues that are doing really well has been difficult. There were only 137 issues hitting new 52-week highs by mid-day, including none that I'm even vaguely interested in. In fact, many issues that I enjoy following, whether invested or now, were trading flat, with a slight negative showing. There were only 2 issues hitting 52-week lows.