Thursday, September 6, 2018

Updating A Bruin Fort Berthold Well In Antelope Oil Field That Produced 150K in Two Months; Section 151-94-26 -- September 6, 2018

Updating this well, original post here:

Original post has graphic and additional information.

The wells:
  • 22708, 1,776, Bruin E&P, Fort Berthold 151-94-26B-35-2H, Antelope, t4/14; cum 310K 12/18; nice bump after coming back online;
  • 20328, 1,647, Bruin E&P, Fort Berthold 151-94-26B-35-1H, Antelope, t3/12; cum 550K 12/18; offline since 1/18; back on line 9/18;
  • 22707, 1,959, Bruin E&P, Fort Berthold 151-94-26B-35-3H, Antelope, t4/14; cum 521K 12/18; offline since 1/18; back on line 9/18;

  • 30541, 4,871, Bruin E&P, Fort Berthold 151-94-26A-35-4H, Antelope-Sanish, t6/18; cum 374K 12/18;

DateOil RunsMCF Sold

  • 30542, 2,010, Bruin E&P, Fort Berthold 151-94-26A-35-5H, Antelope-Sanish, t6/18; cum 105K 12/18;
  • 30543, 2,837, Bruin E&P, Fort Berthold 151-94-26A-35-6H, Antelope-Sanish, t6/18; cum 219K 12/18;

DateOil RunsMCF Sold
  • 30544, 1,129, Bruin E&P, Fort Berthold 151-94-26A-35-7H, Antelope-Sanish, t6/18; cum 70K 12/18;
  • 30545, 2,070, Bruin E&P, Fort Berthold 151-94-26A-35-8H, Antelope-Sanish, t6/18; cum 204K 12/18;
  • 30546, 661, Bruin E&P, Fort Berthold 151-94-26A-35-9H, Antelope-Sanish, t7/18; cum 52K 12/18;

  • 31774, 5,058, Bruin E&P, Fort Berthold 151-94-27A-34-16H, Antelope-Sanish, t7/18; cum 344K 12/18;
DateOil RunsMCF Sold

  • 31775, 2,402, Bruin E&P, Fort Berthold 151-94-26B-35-15H, Antelope-Sanish, t8/18; cum 190K 12/18;
  • 32431, 4,215, Bruin E&P, Fort Berthold 151-94-26B-35-13H, Antelope-Sanish, t7/18; cum 188K 12/18;
  • 31776, 1,992, Bruin E&P, Fort Berthold 151-94-26B-35-12H, Antelope-Sanish, t8/18; cum 101K 12/18;
  • 31777, 3,376, Bruin E&P, Fort Berthold 151-94-26B-35-11H, Antelope-Sanish, t7/18; cum 182K 12/18;
  • 31778, 1,549, Bruin E&P, Fort Berthold 151-94-26B-35-10H, Antelope-Sanish, t8/18; cum 73K 12/18;

Ares Management Acquires Paradigm Energy Partners -- September, 6, 2018

An alert, eagle-eyed reader caught this next story. I'm impressed.

Go back to this 2014 post for the background to this story:
Phillips 66 Partners and Paradigm Energy Partners announce midstream logistics joint ventures: Co and Paradigm Energy Partners, LLC announce that they have executed agreements to form two joint ventures to develop midstream logistics infrastructure in North Dakota. Consisting of two previously announced projects, the Sacagawea Pipeline and Palermo Rail Terminal, the joint ventures are designed to enhance logistical options for crude oil transportation in the Bakken region.
From an earlier press release:
The Sacagawea Pipeline project is being developed to deliver crude oil from various points south of Lake Sacagawea in and around Johnson's Corner and Keene, in McKenzie County, North Dakota, to destinations with takeaway options for both rail and pipe in Palermo and Stanley, N.D.
SPC has received significant shipper interest in committing to the project, and based on such, anticipates receiving sufficient shipper commitments to proceed with the project.  All potential customers will have an equal opportunity to obtain capacity in the project and must submit binding commitments prior to the conclusion of the open season process.
More at the link.

Now, today we have this story, sent in, as I noted, a very, very alert reader. From a press release:
Ares Management, L.P. (NYSE:ARES) announced today that funds managed by Ares EIF, its power and infrastructure strategy, have closed on the acquisition of substantially all of the assets and business interests of Paradigm Energy Partners from an affiliate of Stonepeak Infrastructure Partners.
The Paradigm assets will be combined with Ares EIF’s adjacent Van Hook Gathering System, which it acquired in 2015, to form a premier regional midstream platform serving the core of the Williston Basin in North Dakota, with additional reach into the prolific Eagle Ford Shale in South Texas.
The combined entity, which will continue to be known as Paradigm, will continue to be operated by Paradigm’s existing management team and employee base.
The acquisition consists of two oil and natural gas gathering systems in North Dakota and a third in South Texas, along with joint venture interests in the Sacagawea Pipeline Company and various logistics assets in North Dakota.
By year end 2018, the combined company is expected to transport nearly 50,000 barrels of oil and 23 million cubic feet of gas per day from 11 contracted customers in North Dakota and Texas.

Daily Activity Report Posted A Day Late -- September 6, 2018

Active rigs:

Active Rigs65563375196

Eight new permits:
  • Operators: Crescent Point Energy (5); EOG (2); Resource Energy Can-Am
  • Fields: Ellisville, Parshall, Ambrose
  • Comments: for newbies -- note the chronologic numbers for the EOG Burke wells;
  • 35407: Resource Energy Can-Am LLC, Pacer 3427-164-99-5H, Ambrose
  • 35408: EOG, Burke 78-3501H, Parshall,
  • 35409: EOG, Burke 79-3501H, Parshall,
  • 35410: Crescent Point, CPEUSC Austin 8-17-20-158N-99W-LL TFH, Ellisville,
  • 35411: Crescent Point, CPEUSC Austin 2-17-20-158N-99W MBH, Ellisville,
  • 35412: Crescent Point, CPEUSC Narcisse 2-8-5-158N-99W MBH, Ellisville,
  • 35413: Crescent Point, CPEUSC Austin 5-17-20-158N-99W TFH, Ellisville,
  • 35414: Crescent Point, CPEUSC Narcisse 5-8-5-158N-99W TFH, Ellisville,
One permit canceled: WPX, a Spotted Horn permit in McKenzie County.

Three producing wells (DUCs) reported as completed:
  • 32479, 2,701, XTO, Werre Trust Federal 14X-34AXB, Bear Creek, t7/1; cum 25K after 15 days;
  • 32378, 2,540, XTO, Werre Trsut 21X-3B, Bear Creek, 60 stages; 17.9 million lbs, t6/18; cum 104K after two months;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

33259, A, Whiting, Wold Federal 44-7-1H,  t--; cum --

Time for a song:

Lonesome Friends of Science, John Prine

US Gasoline Inventories Soar; Crude Oil Has A Substantial Draw -- But It Must Be The Gasoline Inventories That Drove A 2% Drop In The Price Of WTI -- September 6, 2018


September 7, 2018: But take a look at this. Reuters suggests US crude oil stockpile decline -- more than expected last week -- is a bullish sign --  
U.S. crude stockpiles fell more than expected last week, while gasoline and distillate inventories rose.

Crude inventories fell 4.3 million barrels in the week to August 31, 2018, compared with analysts' expectations for a decrease of 1.3 million barrels. The decline brought stockpiles to 401.49 million barrels, the lowest levels since February 2015.
Stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose by 549,000 barrels, EIA said.
"The large crude oil inventory drawdown makes for a bullish report, despite the appreciable gains in refined product inventory levels," said John Kilduff, a partner at Again Capital Management in New York.
Refiners' demand for crude oil and drivers' demand for gasoline remain supportive of the market, with gasoline demand remaining near the highest levels of the season, he said. Still, he cautioned that rising stockpiles at Cushing were somewhat bearish.
 Original Post

This is certainly weird and proves the rule: predicting the price of oil is a fool's errand.

WTI falls 2% even though the EIA reports a substantial crude oil draw.
  • US crude oil inventory draw of 4.3 million bbls; inventories now stand at 401.5 million bbls; my threshold = 400 million bbls; we're practically there
  • refineries operating at only 96.6% capacity
  • gasoline production decreased a bit last month; now averaging less than 10 million bbls/day over the past four weeks
  • distillate fuel, on the other hand, is up about 3% over the past four weeks
  • but jet fuel is the big story (and a lot of CO2 emissions): jet fuel product supplied was up over 5% compared with same four-week period last year
  • but this is what is probably driving crude oil down in price today: total motor gasoline inventories increased by 1.8 million bbls last week -- an astounding 7% above the 5-year average for this time of the year -- with that inventory, one would think refineries will request less crude oil going forward, and already refinery are operating at less than 97% capacity after recently being near 99%
The gasoline demand graph:

Natural gas fill rate: link here.

MRO Re-Frack -- For Newbies -- The Life-Cycle Of A Bakken Well -- September 6, 2018

The well:
  • 17498, 498, MRO, Chimney Butte 34-11H, Bailey, t11/08; cum 256K 7/18; API - 33-025-00804; a re-frack; 
  • on re-frack: 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

After the original frack back in 2008:

152-93-30 -- MRO Wells, Reunion Bay

The wells:
  • 22288, 1,466, MRO, Joanne Quale USA 21-30H, Reunion Bay, t1/13; cum 311K 7/18;
  • 22289, 1,444, MRO, Joanne Quale USA 21-30TFH, Reunion Bay, t12/12; cum 363 7/18;
  • 33923, SI/NC, MRO, Maleckar USA 31-30H, Reunion Bay,
  • 33924, SI/NC, MRO, Skadeland USA 31-30TFH, Reunion Bay, no production data,
  • 33925, conf, MRO, Wendell USA 31-30H, Reunion Bay,
  • 34597, SI/NC, MRO, Sheldon USA 21-30TFH, Reunion Bay, no production data,
  • 24620, SI/NC, MRO, Coburn USA 41-30TFH, Reunion Bay, no production data,
  • 24621, SI/NC, MRO, Bobby Lee USA 41-30H, Reunion Bay, no production data,
  • 33928, SI/NC, MRO, Honaker USA 41-30TFH, Reunion Bay, no production data,
  • 24622, 1,448, MRO, Annie USA 11-29TFH, Reunion Bay, t2/13; cum 277 7/18; offline since 2/18;
  • 33927, SI/NC, MRO, Zelda USA 11-29H, Reunion Bay, no production data,
  • 33926, SI/NC, MRO, Cantrill USA 11-29TFH, Reunion Bay, no production data,

Jobless Claims Down An Incredible 10,000 From Previous Week; Analysts Off Again; Jobless Claims At 49-Year Low; Four-Year Average Also At 49-Year Low -- So Low, Evern Kaepernick Found A Job -- Now He Just Needs A Skill Set -- Stock Market Reaction? Yawn -- Tesla May Be Missing Its Own Targets, But It's Blowing Away The Competition -- September 6, 2018

Comment: yesterday I received a note from a reader -- my financial consultant is recommending additional equities in my portfolio. The reader was concerned that his portfolio was increasingly heavy in equities. My thought: would it be riskier if his portfolio was lighter in equities -- holding cash or investing in bonds vs US equity? See ISM below. What's riskier: investing more in the market, less in the market. Probably depends on one's time line / horizon. If horizon is ten years, it's a no-brainer.

PGA: BMW top 70. Leaderboard here. Woods, Fowler, and Spieth in a threesome, starting on the back nine?

UNP: thank you Ms LaDuke.


Japan: massive earthquake shuts down Hokkaido refining. No link, story easily found.

Nike: headline yesterday, "millennials snapping up Nike" after Kaepernick announcement. I doubt folks will make investment decisions on this one announcement. Having said that, who probably holds most of Nike stock: millennials in their 20s or old white men 65+?

Jobless claims: link here. Holy mackerel! Down to 203K --- a decrease of 10K. Amazing. Consensus, 213K (identical to prior, 213K). At a 49-year low -- only the WSJ is reporting that. It's reported and CNBC immediately moves on.
Though data can be volatile from week to week, the four-week moving average of claims, a steadier measure, also fell to a 49-year low.
The measure dropped to 209,500. Jobless claims have remained low in recent years, as the labor market continues to tighten and managers face difficulty finding qualified employees. U.S. employers added 157,000 jobs and the unemployment rate fell back to 3.9% in July, hovering near the lowest level since April 2000, according to the Labor Department’s latest jobs report.
Meanwhile, the overall labor-force participation rate, defined as the share of the adult population either working or looking for work, has been little changed over the past four years. The share of the population with jobs, however, has steadily climbed.
US ISM Manufacturing Index: zoomed to 61.3 from 58.1 -- expectations were for a slight dip to 57.7. Link here. The ISM has not been this high since May, 2004. The market's reaction: yawn.

Largest Saudi debt deal ever? Link here. Data points:
  • Saudi Aramco looking for $70 billion loan
  • to put that in perspective, Saudi's foreign reserves assets is about $500 billion (in very round numbers) 
  • Saudi's monthly foreign reserves move up/down $1 billion to $8 billion / month
  • Saudi Aramco looking to take majority stake in Sabic, a Saudi petrochemical firm
  • Sabic: the world's fourth-largest petrochemical company
Peak demand? What peak demand? Now OPEC says global demand will hit 100 million bopd sooner than expected. Link here. Can you imagine how beholden the world (and the US) would be to Putin and Saudi Arabia had there not been a fracking revolution in the US. Scary.

Irrelevant? How important is Canadian heavy oil for the US or global supply? Apparently not very. Suncor announces cutback in production due to Trans Mountain Pipeline expansion "delay," and WTI actually falls in price. Western Canadian select fell $1.15 to $38.72; meanwhile WTI stays in trading range around $68. Many years ago, WCS was said to have a $60-breakeven point; I doubt it has changed much. 

My favorite company: EPD breaks ground on yet another NGL expansion. Link here. Data points:
  • fractionater adjacent to its complex in Mont Belvieu, TX
  • the company's tenth NGL fractionator at Mont Belvieu
  • 150,000 bbls per day
  • to enter service 1Q20
  • will raise EPD's Mont Belvieu fractionation capability to almost 1 million bopd
  • will raise company's total fractionation capacity to just under 1.5 million bopd
  • the latest expansion at Mont Belvieu represents a departure for Enterprise because the new fractionator will be able to process dramatically larger volumes of NGL than each of the series of units installed before it
Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here.

EPD: considering a new gas plant in east Texas. Data points:
  • $125 million natural gas processing facility
  • 200 million cf/d
  • Panola County, TX
  • construction to being 4Q18 (end of this year); in service 4Q19
EPD: paying 5.94%.

Deep-sea drilling is back. Link here

Meanwhile, back in Burnaby: taking a bold step, Justin Trudeau says Canada might appeal ruling that killed the Trans Mountain. Really? "Might." The appeal should have been prepared before the ruling and dropped on the appellate court in a New York minute. Remember: Trudeau knew that the Trans Mountain faced the same issue that killed the Enbridge Northern Gateway, and the case was being adjudicated by the same judge. Eh, what just happened?

Car sales: when I think Toyota, I think Prius, green, and EV; when I thing Ford, I think SUV. August sales: Ford sales up 4.1%; Toyota US sales drop 2.0%. EV sales for August, link here. Tesla doing surprisingly well, blowing away the competition:
  • Tesla Model 3: 17,800 (goal, 5,000 / week = 20,000)
  • Tesla Model S: 2,625 (2,100 one year ago)
  • Tesla Model X: 2,750 (1,575)
  • Toyota Prius Prime: 2,071 vs 17,800 Tesla Model 3 -- wow, wow, wow -- why is TSLA stock down?
  • Chevy Volt: 1,825
  • Chevry Bolt: 1,225
  • Nissan Leaf: 1,315
  • Chrysler Pacific hybrid: 654
  • But look at the 17,800 for Tesal Model 3 -- blowing away any other individual competitor
Back to the Bakken

One well coming off confidential list today:

Thursday, September 6, 2018
  • 33924, SI/NC, MRO, Skadeland USA 31-30TFH, Reunion Bay, no production data,
Active rigs:

Active Rigs64563375196

RBN Energy: have northeast natural gas supply prices turned a corner?
The Marcellus/Utica region is in the midst of a major turning point. Natural gas production from the region continues to post record highs. But regional basis differentials to Henry Hub are the strongest they’ve been at this time of year since 2013. Spot prices at Dominion South — the representative location for the overall Marcellus-Utica supply — averaged at a $0.35/MMBtu discount to Henry Hub this August, compared with a $1-plus discount to Henry in each of the past four years.
The deep discounts in previous years reflected the inadequate takeaway capacity and the resulting pipeline constraints to get gas out of the region. Now, basis shifts suggest those constraints are easing somewhat — a trend that will redefine pricing relationships across the broader gas market. In today’s blog, we continue a series examining the changing flow and price dynamics in the Northeast gas market.
The Other Side of Town, John Prine