Monday, November 19, 2018

Peak Oil? What Peak Oil? EOR Is Already Here -- November 19, 2018

Link here. Why US oil production won't peak anytime soon.
The U.S. shale oil revolution continues to defy the skeptics, and the country is now producing a record 11 million barrels per day (MMbpd) of crude..... production has been up 18 percent since the start of this year alone. Output has exploded 120 percent over the past decade to heights not dreamed about. Production was long thought to have peaked at 9.6 MMbpd back in 1970.
Texas and North Dakota have been at the forefront, with the former now yielding more oil than Iraq, the world’s fourth largest producer.
Looking forward, given that the United States has accounted for 60 percent of new global oil supply since 2008, ....  how long can the United States continue to produce increasing amounts of oil?
It’s surely a difficult question to answer. The shale bonanza itself has proven that predicting future energy production is a fickle business. Back in 2007, for instance, no forecasting body was projecting how quickly a U.S. shale oil (and natural gas) surge would not just change the U.S. outlook but also transform energy markets around the world. Despite using the most advanced forecasting techniques possible, both the Energy Information Agency’sNational Energy Modeling System and the International Energy Agency’s World Energy Model were completely blindsided
[I think Harold Hamm used a hand-held calculator and maybe an iPad, first version.]
We do know, however, that false pessimistic predictions regarding the future ability of U.S. companies to produce more petroleum have been around since the inception of the industry,.... the record is known: “peak oil” theorists have been proven wrong every time.
[Insert here: "Shale is not a revolution, it's a retirement party." -- Art Berman, who gets big bucks for his prognostications.]
Indeed, too many fail to appreciate oil as an economic commodity powered by market changes, namely the constant advance of extraction technologies. The obsession with reserves (what’s currently available) instead of resources (what’s potentially available with price changes and better technologies) has made most Americans completely unaware of how much oil we have at our disposal. [This, by the way, was a most confusing issue when I first started blogging about the Bakken.]
Proved reserves can grow over time and estimates of the recoverable resource change as new information is acquired—through drilling, production, and technological and managerial development. For example, BP reports that the United States now has 50 billion barrels of proven crude oil reserves, a 66 percent boom over the past decade. [This alone is a very interesting statistic; some think the Bakken alone holds that much.]
The U.S. oil resource is measured in the hundreds of billions of barrels, maybe more. And it is obviously impossible to accurately predict “how much oil we have,” as some 95 percent of the immense, resource-rich U.S. Outer Continental Shelf is off-limits to oil and gas activity. [Peak oil, anyone?]
In fact, without drilling a single new well or making a new discovery, U.S. oil supplies could drastically be expanded. At least two-thirds of the total petroleum in a well is typically left behind after primary and secondary operations because it is too difficult or expensive to extract. [Remember all that talk about the "Red Queen" by the "oil peakers"?]
Now a tertiary technique that produces 0.5 MMbpd in the United States, CO2-based enhanced oil recovery (EOR) will grant us even more access to this hard-to-reach oil, while storing CO2 safely underground.
Like shale has been, large-scale CO2-EOR recovery is the logical next step in turning the “unconventional” into the “conventional” when it comes to crude oil extraction.
From twitter:



From the EIA, these are the weekly projections, not the actual production that will be reported some time later. Note: the EIA continues to estimate that US production is below 12 million bopd when the data certainly suggests to some that US production is now solidly above 12 million bopd:

Random Update On The Oasis Ceynar Wells -- Novebmer 19, 2018

Earlier today, Oasis reported two more Ceynar wells.

This post will not be updated. The Oasis Ceynar wells are tracked here.

The graphic is not remarkable: just a lot of horizontals in an active area in the Bakken.

The Market, Energy, And Political Page, Part 2, T+13 -- November 19, 2018

Nothing going right for Saudi Arabia: Aramco abandons plan for massive corporate-bond sales to fund Sabic deal. From WSJ. Saudi oil company concerned about disclosure requirements and uncertain outlook for oil prices. We've said that from the beginning: the Saudi isn't going to disclose anything.

Natural gas. Story of the year? We've been saying that for weeks. Now this today from oilprice.
A Tampa, Florida-based options trading firm, OptionSellers, went dark this weekend after it informed its clients of a “catastrophic loss event,” resulting from a short squeeze on the natural gas market, ZeroHedge reports.

According to the letter, the short squeeze took place at a rate “truly beyond anything I [president James Cordier] have seen in my career. It overran our risk control systems and left us at the mercy of the market.”

The market obviously had no mercy for traders shorting natural gas; last week, on Wednesday, natural gas shot up 18 percent to the highest since 2014, on the back of forecasts about cold weather that drove traders into a frenzy as they bought more gas to cover their short positions, probably opened on reports of ample supply in the United States.

Cold weather this time of the year is hardly a surprising piece of information, but it somehow managed to surprise traders betting on a price fall in natural gas. Since the start of the month, according to CNBC, natural gas has gained as much as 48 percent, and according to CME Group, trade in the commodity on Wednesday hit an all-time high of 1.2 million contracts.
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Oh, No! I Did It Again!


**********************************
How Will The Millennials Ever Survive?

Bill Murray, Suntory Time, Lost In Translation

The Market, Energy, And Political Page, T+13 -- November 19, 2018

What the Schiff? Oh, Schiff! -- A post that has absolutely nothing to do with the Bakken. 

*******************************
Who shot JR?  

From wiki:
"Who Done It?" was, at the time, the highest-rated television episode in U.S. history. It had a Nielsen rating of 53.3 and a 76% share, and it was estimated that 83 million people watched the episode, more than the number of voters in that year's presidential election.
The previous record for a TV episode had been the 1967 finale for The Fugitive. "Who Done It?" now sits second on the list, beaten in 1983 by the final episode of M*A*S*H. In 2011, Ken Tucker of Entertainment Weekly named "A House Divided" number one of the seven most "Unforgettable Cliff-Hangers" of prime time dramatic television.
The episode was also very popular outside the United States; a session of the Turkish parliament was suspended to allow legislators a chance to get home in time to view the conclusion of the cliffhanger.
Jim Acosta's White House press credentials were reinstated. My hunch: the next press briefing with President Trump on the stage will result in ratings worthy of a "who shot JR?"

Trump: crazy like a fox.

Was the Trump-Acosto brush-up staged to generate record ratings? Whether it was or not, the outcome will be the same. Must-watch TV. LOL.

********************************* 
How To Play Khashoggi

Updates

November 20, 2018: Trump stands with Prince MbS. This is not good. This speaks volumes about Trump's lack of a moral compass. This is not good, but it, too, will pass. Americans don't care. They just like $1.99 gasoline.

Original Post

Some would argue that Trump needs get out in front of the Khashoggi story. They say the story is not going to get any better for Trump. I suppose there's a chance that by ignoring it, something bigger will come along and folks will forget the Khashoggi story.

One suggestion: do the Iran "bait and switch."

With regard to the Iranian sanctions, there were two key components:
  • first, Trump gave Iran and the world several months to prepare (and prepare they did!); and, 
  • second, he reneged on the sanctions ("bait and switch") even before sanctions went into effect
Now, apply that to Saudi Arabia:
  • announce sanctions on Saudi Arabia so severe the King has no option but to sideline Prince MbS
  • but tell Saudi Arabia the sanctions won't go into effect for two years; current defense contracts stay in place, but no new contracts can be written during the two years without US Senate approval, and if the Prince is nor removed as heir to the crown, the sanctions will continue unless the US House/Senate vote to overturn the sanctions (put the onus back on Congress)
  • two years from now, after the 2020 election, Trump can do what he wants if he wins re-election, including removing all sanctions ("the Iranian bait and switch" option)
  • in other words, strong, strong bark; weak, weak bite; sort of like the Iranian sanctions with regard to oil
********************************
Oh, Schiff! What Next For Beto?

The Texas Irishman will no longer be in office after this January. Raising $70 million plus and almost taking the most expensive US Senate race in history -- Beto is no longer just another politician. He's the head of a political machine.

He has a huge organization. To keep that organization in place he needs money. The only way a former politician brings in money is to announce he/she is running again. [Ask Hillary.]

Beto has only two choices: run at the state level, this time against Senator John Cornyn in 2020, or run at the national level for US president.

His "political machine" and his California backers will want more than just another Texas senate race

Look to Beto to show up in Iowa next summer. If Hillary shows up in Iowa, Beto will initially defer to Hillary, willing to work for her campaign. At some point, Beto will show better vote-getting potential than Hillary, and she will either concede before the Democratic primary or lose the primary.

Beto and his machine will study the RFK playbook.

**********************************
Meanwhile, At The Border

This is why the president tweets. This was not shown in mainstream media today. I saw the "old photos" and asked, "What the Schiff?"

Huge Jump In Production In An Old XTO Hazel Well -- November 19, 2018

Background:
This well was not refracked; see graphic at the August 4, 2017, post. Three neighboring Hess wells have just been completed (as far as I can tell; no FracFocus data; and no NDIC sundry form); see this post.
  • 16656, 411, XTO, Hazel 44X-22 Capa, 33-105-01633, t10/07; cum 331K 918; off-line as of 3/18; 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN9-201820184420484385405523181623
BAKKEN8-201831312029736944701528633963
BAKKEN7-2018124124933062939173692
BAKKEN6-20180000000
BAKKEN5-20180000000
BAKKEN4-20180000000
BAKKEN3-20181110000
BAKKEN2-201823197318225267449827631586
BAKKEN1-20180000000
BAKKEN12-20176113713172395244610791334
BAKKEN11-201730136761367623731300761464215154
BAKKEN10-201731238162374941636428021320429309
BAKKEN9-201731245954690735957732807
BAKKEN8-20170000000
BAKKEN7-20170000000

Eight New Permits -- November 19, 2018

Active rigs:

$57.34😱11/19/201811/19/201711/19/201611/19/201511/19/2014
Active Rigs62563964185

Eight new permits:
  • Operators: Enerplus (4); Hunt (3); Petroshale
  • Fields: Mandaree (Dunn); Ross (Mountrail); Eagle Nest (Dunn)
    Comments: Enerplus has permits for a four-well Mandaree "weed pad in 21-149-93; Hunt has permits for a three pad in 2-156-90; and, Petroshale has a single Helen permit in Eagle Nest, section 9-148-94
Three producing wells (DUCs) were reported as completed:
  • 32019, 1,024, Hess, CA-Stangeland-155-95-2128H-7, Capa, t10/18; cum --;
  • 32020, 1,496, Hess, CA-Stangeland-155-95-2128H-6, Capa, t10/18; cum --;
  • 32021, 1,313, Hess, CA-Stangeland-155-95-2128H-5, Capa, t10/18; cum --;
Five permits renewed:
  • Hess: five BB-Federal permits in McKenzie County

North Dakota Air Ambulance Crashed En Route To Williston -- Three On Board Dead -- November 19, 2018

Updates

November 29, 2018: from The Bismarck Tribune --
The investigation so far indicates the airplane broke apart during the flight while the plane was about 12,000 feet above ground, Kirchmeier said. The National Transportation Board is investigating what caused the incident.

The plane was not struck by anything and there was no fire, he said. Weather also is not believed to have been a factor.
Original Post

Link here to The Williston Herald:
  • pilot, paramedic, and registered nurse killed
  • no information on cause of crash or location
  • airplane, not helicopter
From The Bismarck Tribune:
  • crash site is about 15 to 20 miles northwest of Mandan
  • crash site located around 2:00 a.m. 
From the Minneapolis StarTribune:
  • occurred about 10:30 p.m., shortly after take-off
  • about 20 miles northwest of Bismarck
  • there was no inclement weather in the area at the time, just light snow
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The Literary Page
For The Granddaughters

I am currently back in my "really, really, really early history" phase, reading and re-reading the Bible, Homer's Odyssey, Virgil's Aeneid, etc.

I have incomplete notes at these posts:
I maintain copious notes in handwritten journals, and additional notes in "word" documents on the hard drive. 

I'm getting a much better feeling for the "origin" of the Bible -- at least in my mind; we will all have different world views (myths).

The first thing one must do, is note the dates. Many of the dates are not known at all. Because of so much research, more and more, the dates for events after Joseph's life on Earth are "known." Most frustrating, in wiki, the entry's first mention of pharaohs by name is in the section "Pharaohs in the Book of Exodus." The entry does not mention any pharaoh by name in the book of Genesis. In fact, Genesis 47:11: "Joseph settled his father and his brothers, and granted them a holding in the land of Egypt, int he best part of the land, in the land of Rameses, as Pharaoh had instructed."

The scribes writing "in the land of Rameses" could be literal, and contemporary, suggesting that Joseph was in Egypt at the time of Rameses, or the scribes could have been using a literary tag, just as we often today still call Illinois "the land of Lincoln." 

The first Rameses, reigned for one year, founded the 19th Dynasty, 1292 - 1291, time-frame (which by the way is very, very close to time of Trojan War). The last Rameses, Rameses XI reigned in the 20th Dynasty, from 1107 BCE to about 1078 BCE.

Interestingly, it seems we have not come much farther along figuring out Homer's timeline. I like to think that he was most likely alive between 800 BC and 700 BCE (link here). But some suggest he may have lived during or soon after the Trojan War (around 1200 BCE -- probably around 1190 BCE).

The Babylonian Exile: probably somewhere between 598 and 538 BCE -- going into exile and coming out of exile spanning years if not decades, especially the return. It appears many experts suggest the early Torah had its written origins during the years of the exile.

8th century BCE: the Greeks borrowed the Phoenician alphabet and adapted it to their own language, creating in the process the first "true" alphabet, in which vowels were accorded equal status with consonants -- wiki.

Consonantal writing used for Semitic languages in the Levant go all the way back to the second millennium BCE -- wiki.

The Torah is written in Hebrew, the oldest of Jewish languages -- BBC.

From wiki:
The earliest examples of written Paleo-Hebrew date from the 10th century BCE.
Hebrew belongs to the West Semitic branch of the Afroasiatic language family.
Hebrew is the only living Canaanite language left, and the only truly successful example of a revived dead language.
Hebrew had ceased to be an everyday spoken language somewhere between 200 and 400 CE, declining since the aftermath of the Bar Kokhba revolt. Aramaic and to a lesser extent Greek were already in use as international languages, especially among elites and immigrants. Hebrew survived into the medieval period as the language of Jewish liturgy, rabbinic literature, intra-Jewish commerce, and poetry.
Then, in the 19th century, it was revived as a spoken and literary language. It became the lingua franca of Palestine's Jews, and subsequently of the State of Israel. According to Ethnologue, in 1998, it was the language of 5 million people worldwide. After Israel, the United States has the second largest Hebrew-speaking population, with 220,000 fluent speakers, mostly from Israel.
This is quite interesting. Hebrew and Latin would have followed a similar path, with each language surviving among their respective clergy and liturgy. But then Latin as an oral language died out, never to return -- a dead language. Hebrew "rose from the dead."

When I put all this together, in my mind, Homer's writing of the two great epics was "contemporary" with the Bible in the big scheme of things. "Contemporary" -- spanning several centuries in the first millennium BCE.

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Watching The Wheels

Watching The Wheels, George Harrison

The Market, Energy, And Political Page, T+13 -- November 19, 2018

Algore bet on the wrong horse. Imagine if Algore had predicted a mini-ice age back in 1994 -- he would have been seen now as a genius -- rivaling that of Einstein. Instead, we get this:


Got gas?



A reader noted that just because it's cold somewhere, doesn't mean it's cold everywhere. See first comment. That's true, but it certainly seems cold almost everywhere in the northern hemisphere right now. At least in North America, Europe and Russia. I don't know about China.

Passed/past her shelf life (by several election cycles):


Most popular votes: the meme that "someone" in the national election received more popular votes but still lost the election is becoming a bit overused, a cliche. In fact, the way the state of California has changed their election laws means this:
  • it is a fact: more than likely from here on out: the winner of the popular vote in national elections will likely not win the electoral college vote; call it the "California effect" (see below) -- Ms Kamala Harris can take every vote in California but she will still get no more electoral votes than if she won by the narrowest of margins; taking all the votes in California guarantees one will take the "national popular vote"; and, one could still lose the presidential election
  • regardless of of what party you are when you go into the voting booth in California, you will leave having voted for a Democratic candidate
  • over time, the GOP will completely die out in California; not only is it almost impossible now to win if one declares as a Republican in California, in the near future, GOP candidates won't even be on the California statewide ballot
  • it is possible that the number of people voting in California will decline over time when it is clear that their votes no longer matter; in Texas, many disaffected folks feel their votes do not matter; Texas has the nation's worst voter turnout; my vote in Texas definitely won't count -- mostly because it will be canceled out by my wife's vote. LOL.
California caravan: US border closed temporarily to strengthen the fence. Something tells me that if the US said they were going to close the border until the Honduran caravan turned around, the Mexican government would have that caravan turned around in a NY minute.

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The Book Page

A huge thank-you to a reader for reminding me to post this.

I finished reading this book for the third time -- each time I understand it a bit more; each time what I do understand is reinforced. I highly recommend it for any high school student in advanced chemistry or physics classes: Absolutely Small: How Quantum Theory Explains Our Everyday World, Michael D. Fayer, Ph.D, Stanford University, c. 2020.

Fayer describes how CO2 acts as a greenhouse gas. Incredibly well written and easily understood by students as young as those in middle school.

Fayer noted that without CO2 warming the planet, the Earth would probably be too cold to support human life.

Unfortunately he then concludes that section by "comparing" what is happening on Earth to that on Venus, and this is how otherwise credible physicists lose their credibility.

I speak from experience: I had a most excellent chemistry professor in college, but he was "hung up" on fluoridated water -- the "global warming" fad of the 1960's. He was a great chemistry professor but he did lose a bit of his objectivity as a scientist when he went on and on about the hazards of fluoridation. I don't know if he had any concerns about iodized salt (which, by the way, seems to me to be a misnomer of sorts).

From pp. 298 - 299 for Fayer's book:
Today the concentration of CO2 in [Earth's atmosphere] is 0.038%, or 380 ppm (parts per million by volume). In 2000, it was 368 ppm. In 1990, it was 354 ppm.....
What happens if the CO2 concentration in the atmosphere continues to rise? [And I'm not making this up. This is how Fayer answers that quesion.]
What happens if the CO2 concentration in the atmosphere continues to rise? Venus is an extreme example. Its atmosphere is more than 90% CO2, and its temperature is approximately 900 degrees Fahrenheit
Some observations and comments:
  • Fayer provided the ppm / percentage conversions for several historical points in Earth's history (as low as 284 ppm in 1832 to as high as 380 ppm now); but he never noted that 90% converts to 900,000 ppm on Venus -- a tad bit more than the Earth's current 440 ppm, and not even close to the 600 ppm projected by faux environmentalists for the end of this century
  • he did not note that Venus is a tad bit closer to the Sun than is Earth
  • he did not provide any of the current theories for how the atmosphere on Venus came to be predominantly CO2, and none of the current theories relate at all to what is happening on Earth
  • if one is interested in connecting the dots, the dots will take you to oceans (non-existent on Venus and apparently rising on Earth); classical algebra tells me that as the Earth's oceans rise, the volume of ocean water will also increase
By the way, Linus Pauling, winner of two Nobel prizes in two different fields (the only one to have done that, I believe) also lost a bit of objectivity when it came to vitamin C.

By the way, speaking of oceans, look at this: scientists unable to explain "oceans and missing water." But we know that if "we don't do anything," the Earth will be 2 degrees warmer in 2100 than it is now. From the linked article:
And that raises some questions: The water that goes down must come up, usually in the contents of volcanic eruptions. The new estimate of how much water is going down is larger than estimates of how much is being emitted by volcanos, meaning scientists are missing something in their estimates, the researchers said.  There is no missing water in the oceans, Cai said. That means the amount of water dragged down into the crust and the amount spouted back out should be about equal. The fact that they aren't suggests that there's something about how water moves through the interior of Earth that scientists don't yet understand. 
So much to learn as long as one has an open mind. The science of global warming is not "closed." At least in my mind.

The same story at another link: from Weather.
  • The Earth is eating its oceans far faster than originally thought, a new study says.
  • Researchers found three times more ocean water is being sucked into the Earth's interior than estimated.
Which begs the question .... of course....
 

Something I've Never Seen Wind/Solar Do For Their Communities -- November 19, 2018

In eleven years of blogging about the energy industry, I have never seen a renewable energy company (solar/wind) give this kind of support to the community. Solar/wind relies on grants, credits, mandates, in exchange for higher electricity prices.

From Reuters: US shale firms offer $100 million to aid Texas, New Mexico in infrastructure.
More than a dozen top U.S. energy companies have pledged $100 million toward easing stresses on health care, education and civic infrastructure from the shale oil and gas boom in West Texas and New Mexico.
Chevron, EOG Resources, Exxon Mobil and Royal Dutch Shell are among 17 companies backing the Permian Strategic Partnership, as the consortium is called.
The group seeks to address labor and housing shortages, overtaxed health care and traffic congestion caused in part by companies descending on the Permian Basin, the nation’s largest oilfield, where they hope to pump billions of dollars’ worth of oil and gas in coming decades.

Seven Wells Coming Off Confidential List; Many Are DUCs -- November 19, 2018

A photo and comment sent to me from Plano, north of Dallas, yesterday:


My brother-in-law tells me the "low" in Huntington Beach, CA, is $3.85.

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Back to the Bakken

The Kennedy-Miles wells are tracked here.

Wells coming off the confidential list over the weekend, Monday:
Monday, November 19, 2018:
  • 34048, SI/NC, MRO, State Kelling 14-36TFH, Bailey, no production data,
  • 33329, SI/NC, XTO, Dakota Federal 42X-36D, Bear Den, no production data, 
  • 33225, 1,592, CLR, Kennedy 7-31H, Dimmick Lake, 4 sections, 62 stages; 12.7 million lbs, t5/1; cum 87K 9/18; 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN9-20182526186262012302956372492797088
BAKKEN8-201830447714505426763940467813115909
BAKKEN7-2018111508114655933628964263282636
BAKKEN6-20180000000
BAKKEN5-201857877874306233702337

  • 32960, SI/NC, Oasis, Ceynar 5298 44-32 13B, Banks, t--; cum 139K 9/18; 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN9-201830328523319121499657715062014671
BAKKEN8-201831373613714528814730094788124632
BAKKEN7-20183132781327522694172566720700
BAKKEN6-201830252802518625122597254829310952
BAKKEN5-2018151084510845210882553924899400

Sunday, November 18, 2018:
  • 32945, 645, Oasis, Ceynar 5298 42-32 10B, Banks, t6/18; cum 95K 9/18;
Saturday, November 17, 2018:
  • 33872, SI/NC, MRO, Lawrence 34-35H, Bailey, no production data, 
  • 33330, SI/NC, XTO, Dakota Federal 42X-36HXE, Bear Den, no production data, 
Active rigs:

$55.94😞11/19/201811/19/201711/19/201611/19/201511/19/2014
Active Rigs62563964185

RBN Energy: Houston crude oil futures contracts compete for market share.
The race is on and here comes WTI up the backstretch. On November 5, CME Group launched a Houston WTI futures contract, challenging a similar trading vehicle from Intercontinental Exchange (ICE) that started up in mid-October.
Ever since crude flows to the Gulf Coast took off five years ago, the crude market has been clamoring for a trading vehicle that would accurately reflect pricing in the region that dominates U.S. demand from refineries, imports and exports.
Now there are two.
But their features are quite distinct. ICE’s contract reflects barrels delivered to Magellan East Houston, while CME’s contract is based on deliveries into Enterprise’s Houston system. The specs are different, as are the physical attributes of the two delivery points. Will both survive? Probably not. Futures markets tend to concentrate liquidity — trading activity — into a single vehicle that best meets the needs of the market. So, which of these will come out on top?  That’s what the crude oil market wants to know. In today’s blog, we delve into the differences between the two new futures contracts for West Texas Intermediate (WTI) crude delivered to Houston and ponder the market implications of these new hedging and trading tools.
So, WTI, ICE, and CME.