Monday, October 14, 2019

Bloomberg Op-Ed On Short-Term Outlook For US Shale -- October 14, 2019

I don't care for the headline, but the article -- said to be an "op-ed" piece -- is actually pretty good.

Link to the Bloomberg article here.

Abraxas And Whiting Talking-- October 14, 2019

Updates

October 15, 2019: in the following update, the reader is correct -- market cap for Abraxas is $65 million; the earlier figures reported yesterday were from corporate presentations a year ago. Share prices were $2.20/share a year ago according to Yahoo!Finance but today are trading at 38 cents.  38/2.20 = 17% x $400 million (then) = $68 million (today) so the "numbers all work out."

October 15, 2019: remember, this is not an investment site. We follow the market to give us a better understanding of what is going on in the Bakken. With that caveat, here's a pretty good summary following the announcement (see first comment):
Abraxas market cap is $65 million as of today... This is similar to the QEP-planted rumor reported by Reuters about Whiting or Blackstone buying them. I don't see Whiting wanting the TX assets (which aren't worth $30k per acre, probably half that or less due to location and quality).

Abraxas has $200 million in debt, owns their own rig which they can't put to work, and generally has over-drilled all their acreage in North Dakota. Also, they had to halt their Texas drilling due to prices (gas sells for next to nothing where they are located and the wells don't produce enough oil, uneconomic). Also, they already sold all of their non-op. Whiting might tough (sic - touch) their Bakken assets at the right price but the company is structurally bankrupt at this point. Most likely option is going to be bankruptcy after this rumor is proven false. The playbook for oil and gas companies, go bankrupt and come back out with debt cut in half. It's a shame. They won't fire sale the Bakken because their other assets aren't worth much. Their best option is to file with a prepackaged BK plan. 
Original Post

From Reuters today (a huge "thank you" to a reader for alerting me to this story):
Whiting Petroleum Corp, an oil and gas producer with operations in North Dakota and Colorado, is in deal talks with San Antonio-based Abraxas Petroleum Corp.
Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

Over at "Bakken Operators," this on Abraxas:

Abraxas
  • January, 2019, corporate presentation; looking to sell Bakken assets; EURs: MB, around 900K boe; Three Forks, around 800 boe;
  • Filloon on AXAS, May 8, 2017; 
  • November 6, 2013: sells 2,563 non-producing Bakken acres in its Fairview Prospect, Montana (Richland County) for $10.9 million ($4,250/acre)
  • August, 2013: sees 4,600 - 4,800 boepd December, 2013, exit rate;
  • sells 13,500 net acres; non-operated assets; to NRP; $35.5 million -- June 17, 2013
  • 4Q12e: 4,300 - 4,500 boepd
  • Operations in both the Bakken and Eagle Ford
  • 21,000 net acres in the Bakken (ND + MT); 20,853, SeekingAlpha, 2011
  • BEXP presentation says Abraxas has 20,853 net acres
  • Nesson: 2,600 net acres; nice acreage
  • Carter: 3,200 net acres; northeast of best Bakken; +/- value
  • North Fork: 3,200 net acres; nice acreage
  • Elkhorn Ranch: 2000 net acres; southwest North Dakota
  • Elm Coulee: 440 net acres; where it all started in 2000
  • Harding: 5,800 net acres; Williston area; nice area
  • Sheridan: 3,000 net acres; Montana northwest of Williston (quality?)
Note that first bullet, January, 2019.

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Background

Corporate presentation, April, 2018, still available on line.

Summary of the Abraxas corporation, January, 2019, available here. From that summary:
Also, here at SeekingAlpha.
Abraxas is budgeting $95 million for capital expenditures in 2019.
This is expected to result in 11,000 BOEPD in average production during the year and perhaps slightly positive cash flow at mid-$50s WTI oil.
Abraxas is looking at options for its Bakken assets, which have limited inventory remaining, but currently provide the majority of the company's production and cash flow.
The decision on what it does with the Bakken assets will have a significant impact on Abraxas's estimated value.
4,000 acres in the Bakken and it provides the company's production and cash flow. I think that simply incredible. I guess I find it even more incredible the company is considering selling their Bakken assets.
***************************************
Back Of The Envelope: Abraxas

Some are Abraxas' figures; others are mine:
  • market cap: $400 million
  • Permian: 10,000 net acres x $30,000/acre = $300 million
  • Bakken: 4,000 net acres x $7,500/are = $30 million
  • acres: $330 million
  • production: 
    • 10,000 boeped = $400K / day
    • annual oil & gas revenue: $400K x 365 = $150 million / year
  • CAPEX: $140 million 
*******************************
Back of the Envelope: Whiting

Some are Whiting's figures; others are mine:
  • market cap: $660 million
  • revenue: $1.9 billion
  • operating cash: $1 billion
  • total debt: $3 billion
  • outstanding shares: 90 million
  • 90 million x $7 = $600 million
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Idle Chatter

In progress.

WLL: shares were down 2.4% today (on a generally "down" day for the market) but up a percent in after-hours trading.

If interested in investing in WLL at this time, there are two periods in which to invest:
  • now, prior to any announcement;
  • then, after the announcement;
This post is IN PROGRESS.

Disclaimer: simply idle chatter. No thoughts on this as a business deal, one way or the other.

Market cap:
  • Whiting and Abraxas in same ballpark: $400 million to $600 million
If this is an all-stock deal, as reported by Reuters, it doesn't take a rocket scientist to estimate Whiting's dilution.

The Bakken Never Fails To Surprise Me -- October 14, 2019

The well:
  • 32276, 433, Slawson, Gobbler Federal 4-26-35MLH, Big Bend, t6/19; cum 8K 8/19;
The graphics:




Frack data:
  • western lateral, first bench, Three Forks: 46 stages; 9.62 million lbs;
  • eastern lateral, second bench, Three Forks: 46 stages; 9.78 million lbs;
From the well file:
  • spud date: July 28, 2018 (small rig)
  • cease drilling: September 5, 2018 
  • first bench:
    • 20,708' TD
    • 10,196.20' TVD
    • 11,54796' VS
  • second bench:
    • 20,900' MD
    • 10,241.89 TVD
    • 11,602.89 VS
  • dates:
    • spudded July 28, 2019
    • lateral 1 reached TD on August 25, 2018
    • lateral 2 began at 10,659' MD on August 31, 2018, and reached TD on September 5, 2018
  • drilling hours:
    • vertical: drilled in 59.5 hours in two runs
    • curve: drilled in 15.7 hours in two runs
    • lateral 1, first bench, 55.82 drilling hours in a single run; 100% in zone;
    • lateral 2, second bench, 80.1 drilling hours in a single run; 100% in zone; gas between 246 and 5,895 units;

MRO With Six New Permits -- October 14, 2019

Active rigs:

$53.4310/14/201910/14/201810/14/201710/14/201610/14/2015
Active Rigs5867593166

Six new permits, #37084 - #37089, inclusive:
  • Operator: MRO
  • Field: Antelope-Sanish (McKenzie)
  • Comments:
    • MRO has permits for a six-well USA pad in section 35-152-94, Antelope oil field
One producing well (DUC) reported as completed:
  • 32277, 1,454, Slawson, Goblin Federal 1 SLH, Big Bend, t9/19; cum --; see below
**************************************************
File Report: 32277
 
32277 -- from the file report
  • vertical
  • drilled in 51.27 hours (slightly more than two full days); three runs
  • started at 3:00 a.m. CDT, August 7, 2018
  • reached KOP at 11:00 a.m. CDT, August 11, 2018
  • curve: 13.3 hours in one run, started at 9:00 p.m. CDT, August 11, 2018
  • horizontal: drilling time, 61.47 hrs; started at 6:30 a.m. CDT, August 14, 2018, single run
  • TD: 20,528 feet reached at 2:20 a.m. August 18, 2018, 
  • low gas units
  • lateral 100% in the zone
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Flashback

From the blog, August 11, 2012:
Here's another article talking about the revolution in the oil and gas industry ... and again, the Bakken is the "gold standard." I think we've seen this story before.

The lede:
Global oil supply capacity is growing at an unprecedented level, and could result in an overproduction glut and steep dip in oil prices, according to a June 2012 study from Harvard University's Kennedy School of Government.

Contrary to the idea among some that global oil supply is running out, additional production of 17.6 million barrels of oil per day (bopd) could come online by 2020, boosting global production capacity to 110.6 million bopd, even with depletion rates for currently producing oilfields and reserve growth.
Then, note this:
The United States has more than 20 big shale oil formations, in particular the Eagle Ford shale, which has a hydrocarbon endowment on par with the Bakken. Most U.S shale and tight oil plays are also profitable at a West Texas Intermediate price ranging from $50 to $65 per barrel, making them "sufficiently resilient" to a significant downturn in oil prices.
Repeat: a hydrocarbon endowment on par with the Bakken.

"The Bakken" may not be a household word east of Berthold or west of Bainville, but anyone who knows anything about the oil industry, knows about the Bakken.

Also, note this:
[The author of the study] estimates spare global oil capacity – the difference between the world's total oil production capacity that can be reached within 30 days and sustained for 90 days and the actual production – at about 4 million bopd, which seems capable of absorbing a major disruption from a big oil producer such as Iran.
That explains why loss of Libya's oil had no appreciable effect on world markets, and current Iranian embargo: effects? Nada. Zip. Zilch. A Richmond, California, refinery fire that was put out in minutes will have a greater effect on price of gasoline in California than geopolitical events to date in the Mideast. 

There is so much more at this linked article; enjoy. Check out the break-even price of oil in these unconventional plays at the linked article. It might surprise you.

Notes From All Over, Part 1 -- October 14, 2019

Record: China's September crude oil imports hit 10.08 million bopd -- data points:
  • this is a record -- first time China's imports went over the 10 million bopd mark since April, 2019
  • April, 2019, imports were a record: 10.68 million bopd
  • month-over-month: a 1% increase
  • S&P Global Platts uses a 7.33 conversion factor, metric tons to bbls
  • most interesting, fuel oil: 
  • fuel oil imports dropped 13% year-over-year
  • I don't know what that "means"
  • for the year, China's crude oil imports are up about 10% year-over-year
  • China's net oil product exports: rocketed 207% year-on-year 
Sorry, Greta, India is going to need more coal. LOL. 

Debacle: over at the twitter-sphere, it is being reported that the Russian national anthem played by the Saudi Arabian orchestra was a disaster. This is not surprising. Bernard Lewis discussed this at length in his classic, What Went Wrong: The Clash Between Islam and Modernity in the Middle East,  c. 2003. A very, very good read.

Insects. I spent the weekend reading about insects (taxonomy). I now feel comfortable with the taxonomy. See this post: Natural Histories Innumerable Insects: The Story of the Most Diverse and Myriad Animals on Earth, Michael S. Engel, c. 2018. One of my top-shelf books.

Perry Mason: I watched episode 31 of the first season last night. I love the series. Amazon Prime offers the first five seasons for "free." Only one question: Does Lt Tragg or the DA ever figure out that Perry Mason is going to win every case? Apparently he lost two cases in the multi-year series. Why did "men" like Perry Mason so much? Answer: Big Bang Theory had Penny. Perry Mason had Della Street. And for my money, I'd rather spend it on Della than on Penny. Just saying. Married 46 years to her first and only husband, died at the age of 94. I think of her often, how it must have been to be part of the Hollywood crowd then.

Off To The Farm And To The Market We Go -- October 14, 2019

When I am not cave-man grilling, I enjoy slow-cooking (inside).

Learning as I go along.

Generally, beef of some sort -- flank, chuck roast, t-bone (particularly good, of course).

Today, I'm trying pork sirloin roast. Wow, sirloin.

To the market we go.

I don't know if you can see this: a pork roast originally priced at $2.99/pound has its price marked down by 50% -- coming near its expiration date, I suppose. So, for $3.14 (that's the total price), I have a 2.10 pound pork sirloin roast, slow cooking.


At the pumpkin patch last week; this will be the last year Sophia can ride the children's tractors (LOL):


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Next

Beef directly from the ranch.

DFW grass-fed beef.

Link here.  The Hudspeth farm, about an hour north of us, but it's near Forestburg, TX,  just north and west of Denton, TX, where our oldest granddaughter often has water polo tournaments, so next time we're in the area ...

The WPX Nancy Dancing Bull Wells And The Immediate Area -- Octoer 14, 2019

Eight wells in the Elk - Dancing Bull section, section 16-150-92:
  • 31014, 702, WPX, Elk 17-20HE, Van Hook, t10/15; cum 284K 8/19; a very strong, consistent well; producing 4,500 bbls/month, 8/19;
  • 25245, 838, WPX, Elk 16-21HW, Van Hook, t11/13; cum 412K 8/19; a steady performer; about 3,000 bbls/month, 8/19;
  • 25246, 838, WPX, Elk 16-21HW, Van Hook, t11/13; cum 265K 8/19; no jump in production when it came back on line 4/19;
  • 18794, 262, WPX, Elk 16-21H, Van Hook, t5/11; cum 664K 8/19; a very strong, consistent well; producing about 3,000 bbls/month, 8/19;

  • 23451, 1,435, WPX, Dancing Bull 16-21HC, Van Hook, t4/13; cum 468K 8/19; a very similar production profile to the others in this group;
  • 23452, 2,187, WPX, Dancing Bull 16-21HZ, Van Hook, t4/13; cum 394K 8/19; same as above;
  • 23453,1,479, WPX, Danicng Bull 16-21HD, Van Hook, t4/13; cum 433K 8/19; same as above;

  • 30637, 96 (no typo), WPX, Juniper 15-22HE, Van Hook, t11/15; cum 296K 8/19; same as above; producing 4,000 bbls/month, 8/19;

Wells south of the Nancy Dancing Bull section, section 13-140-93:
  • the following eight are still confidential; some will run north; some will run south --
  • 36397, conf, RimRock, Two Shields ... 1HU, Mandaree,
  • 36398, conf, RimRock, Two Shields ... 4H3U, Mandaree,
  • 36399, conf, RimRock, Two Shields ... 4H3, Mandaree,
  • 36400, conf, RimRock, Two Shields ... 3H, Mandaree,
  • 36401, conf, RimRock, Skunk Creek ... 16HU, Mandaree,
  • 36402, conf, RimRock, Skunk Creek ... 13H3U, Mandaree,
  • 36403, conf, RimRock, Skunk Creek ... 13H, Mandaree,
  • 36404, conf, RimRock, Skunk Creek ... 13H3, Mandaree,

  • 18518, 2,736, RimRock, Two Shields Butte 3-24-12-4H, Mandaree, t4/14; cum 461K 8/19;
  • 20257, 2,475, RimRock, Two Shields Butte 3-24-12-3H3, Mandaree, t4/14; cum 393K 8/19;

The following eight are still confidential; some will run north; some will run south --
  • 36288, conf (ros), RimRock, Two Shields ... 3HA, Mandaree,
  • 36289, conf, RimRock, Two Shields ... 3H3A, Mandaree,
  • 36290, conf, RimRock, Two Shields ... 2H, Mandaree,
  • 36291, conf, RimRock, Two Shields ... 2H3, Mandaree,
  • 36292, conf, RimRock, Skunk Creek .. 14HA, Mandaree,
  • 36293, conf, RimRock, Skunk Creek .. 14H3A, Mandaree,
  • 36294, conf, RimRock, Skunk Creek .. 14HB, Mandaree,
  • 36295, conf, RimRock, Skunk Creek .. 15H3, Mandaree,

  • 18517, 1,595, RimRock, Two Shields Butte 2-24-12-2H, Mandaree, t9/11; cum 560K 8/19;
  • 19826, 2,845, Rim Rock, Two Shields Butte 2-24-12-1H3, Mandaree, t9/11; cum 510K 8/19;
  • 30929, 1,989, RimRock, Two Shields Butte 1-24-12-1H, Mandaree, t1/17; cum 491K 8/19 ; huge well; a very different production profile than the others in this group

The wells in the Nancy Dancing Bull section, section 12-149-93:
  • 35713, 1,450, WPX, Nancy Dancing Bull 1-36HQL, Mandaree, t7/19; cum 28K in 27 days;
  • 35714, 2,798, WPX, Nancy Dancing Bull 1-36HE, Mandaree, t8/19; cum 55K in first full months; cum 63K 8/19; two months of production, 8/19; the best well of the bunch so far;
  • 35715, SI/NC, WPX, Nancy Dancing Bull 1-36HW, Mandaree, no production data, yet, 8/19;
The wells to the north of the Nancy Dancing Bull section, section 1-149-93:
  • 18396, IA/981, WPX, TAT 15-1H, Mandaree, t8/10; cum 282K 5/19; a short one section well; TD - 15,440 feet; off line as of 5/19; fracking in the neighborhood?
  • 20508, 257, WPX. Buffalo 1-36HC, Mandaree, t5/12; cum 493K 8/19; off line as of 6/19, then back online as of 8/19; fracking in the neighborhood;
  • 21609, 138, WPX, Corral 1-36HD, Mandaree, t5/12; cum 556K 8/19; off line as of 6/19; back on line as of 8/19; fracking in the neighborhood?
For newbies, let's go through the exercise.
  • I posted the "Nancy Dancing Bull" wells because one is coming off the confidential list today, and one of the three Nancy Dancing Bulls that has been reported, produced 55K+ in the first full month of production; a huge well
  • eager to see what the other Nancy Dancing Bull wells will do and the status of the rest of the wells in the immediate area
  • in that long list, there is one DUC (SI/NC);
  • the question is whether that well, #35715, has been fracked
  • going through the production profiles of the other wells, three wells were taken off line; one remains off line;
  • good wells in the Bakken that are taken off line often suggests fracking activity in the area
  • my hunch: that DUC, #35715, has been fracked
  • let's see what FracFocus has to say; NDIC has not yet posted any frack data; 
    • FracFocus: according to FracFocus, the well, #35715, has been fracked; it was a one day, frack the day after July 4th, 2019, earlier this summer; no well in the Bakken is fully fracked in one day;
    • July 5, 2019 - July 5, 2019
    • 106,562 gallons of water
    • 93.4% water by mass
    • 4.7% sand by mass
    • obviously something went wrong, or that was some kind of initial test/completion and WPX will come back to do a full frack; but the neighboring wells are coming back on line suggesting that for the time being, this well, #35715, is "done"

7:50 A.M. And I'm Done For The Day -- October 14, 2019

First things first. I didn't watch the NFL yesterday. In fact, I didn't even care about the Dallas Cowboys game. Forgot all about it. I assumed it was going to be a blowout -- the Dallas Cowboys slamming the NY Jets. This morning, in a conversation I almost missed, I hear that the Cowboys lost to one of the worst teams in the NFL. Are you kidding? Wow, I'm glad I didn't watch that game. Isn't the highest paid player in the NFL on the Dallas Cowboys team? Time for Jason Garett to go.  A 10-year Dallas Morning News sports writer had great things to say about the highest paid player on the team. Close reading of the game suggests Zeke Elliott is all hat, no cattle. Actually, perhaps not quite that bad, but certainly not what one might expect. Again, I'm probably in the minority on this.

NASCAR: didn't watch. Today I see the results: 57 laps of the planned 188 laps. Rain? One more reason I no longer watch NASCAR.

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

Wow, it's going to be a slow news day. I've pretty much posted everything I had planned to post.

Beautiful day for biking. Very, very overcast; it looks like rain, but the maps show the "weather" is to the south of us and will miss us. The forecast also shows no rain in the local area until later this afternoon.

Lots and lots of articles on Apple, Inc, all of a sudden. The new iPhone is apparently attracting a lot of attention. Several weeks ago (or was it just last week) I pointed out two things about the much improved iPhone, the iPhone 11:
  • price point is less than previous iteration
  • price point well less than $1,000
  • pent-up demand after the relative unimpressive demand for the iPhone X
Apple needs to come out with a new phone every year, but it certainly appears, that based on the iPhone X / iPhone 11 we might see great years in the odd years (2019, 2021, 2023) and less impressive even years (2020, 2022, 2024). It all has to do with two-year contracts, or 18-month leases.

Along that line, from Bloomberg earlier this morning: Apple's lower prices, users' aging handsets drive iPhone demand.

And interesting, the graphic notes that 2015 (an odd year) was a "record year for iPhone sales." Those devices are now 4+ years old.

I'm not big into "upgrades," but my Apple SE which I absolutely love, is only 18 months old and it seems I have had it for ages. If Apple came out with a new phone, similarly sized, I would upgrade.

Interestingly, the price point seems to be less of a concern than I realized (I assume that's because of the ... well, let me get back to that....):
The $999 version of the iPhone 11 Pro with a 5.8-inch screen has also been one of the most popular new models, the people added. A recent search on Apple’s website showed many stores in the U.S, Greater China, the U.A.E, and Australia were sold out of most of the Pro models, while the base iPhone 11 was abundant. Many models ordered online now won’t arrive until early November.
I was saying: the price point seems to be less of a concern than I realized. There are two reasons:
  • the carriers (Sprint, ATT, Verizon) are offering incredible monthly financing; and, 
  • over time folks get used to their monthly data plan, and are not bothered by "cost creep"
Disclaimer: this is not an investment site.  Do not make any investment, financial, career, travel, job, or relationship decisions based on what you read here or think you may have read here. 

Futures were pretty much negative overnight. The market opened "red." One would not expect much on this "bank holiday." And now this: the market turns green. And AAPL, opening flat, is now up a $1.37, trading, I assume, at another all-time high.
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MJ Hegar

One thing led to another and another, and eventually I ended up here. Wow, what a story.
In December 1999, Hegar was commissioned into the U.S. Air Force through ROTC at the University of Texas.
From April 2000 to March 2004, she served on active duty as an Aircraft Maintenance Officer. She was initially stationed at Misawa Air Force Base in Misawa, Japan.
She was also stationed at Whiteman Air Force Base, Missouri, where she worked on the F-16 Fighting Falcon and the B-2 Stealth Bomber. Her maintenance career culminated in responsibility for 75% of all B-2 maintenance as a Captain and selection as the Company Grade Officer of the Year for 2003.

In 2004, Hegar was selected for pilot training by the Air National Guard.
Upon completion of her training at the top of her class, she served two deployments to Afghanistan, flying Combat Search and Rescue on over 100 missions as well as Medevac missions as a helicopter pilot.
On July 29, 2009, on her third tour to Afghanistan, Hegar was shot down on a Medevac mission near Kandahar and sustained wounds during a conflict with the Taliban.
Taliban ground forces shot at the helicopter, which disabled her helicopter, and wounded her with shrapnel in her arm and leg. Although injured, Hegar and her pilot were able to rescue the soldiers but under further heavy fire, the helicopter was forced to conduct an emergency landing. 
Another U.S. Army helicopter were able to rescue her, her team, and the other soldiers, but because the rescue helicopter was full, she and others had to fly out on holding on to the wheel of the Blackhawk
On the way up out of the area, she saw insurgents and returned fire towards the area where she saw muzzle flashes.
Hegar was awarded the Purple Heart in December 2009.
Her actions on this mission earned her the Distinguished Flying Cross with Valor Device in 2011.
She was one of the few women to receive this medal after Amelia Earhart.
Making America great. 

Nice Overview Of The New Williston Basin International Airport -- October 14, 2019

Link here to "North Dakota Living."

If everything works, you should be able to page through, just like reading the magazine itself, the magazine, until you get to the airport story. 

Random Examples Of "Old" Bakken Wells With Significant Jumps In Production --- October 14, 2019

 The well:
  • 20359, 96 (no typo), WPX, Bear Den 24-13H2, middle Bakken; Spotted Horn, 12 stages; 2.7 million lbs, t10/11; cum 512K 8/19;
Selected:
BAKKEN1-2016319066911943791139570622668
BAKKEN12-201531101601023055361262350405813
BAKKEN11-20153099751006267631253890891714
BAKKEN10-201531109981076390301382593612751
BAKKEN9-20153097769861101511228883182401
BAKKEN8-20152316031539584223355391450
BAKKEN7-20153031553057100545983030747
BAKKEN6-20153037363754604692557020
BAKKEN5-20153143324335836691854490
BAKKEN4-2015303958401066357683572799

********************************
The well:
  • 17978, 993, WPX, Nathan Hale 4-25H, Spotted Horn, t1/10; cum 377K 8/19;
Selected:
BAKKEN2-2018231713917228604820688116846583
BAKKEN1-2018221431714981687217280103244721
BAKKEN12-201731227542203411469274641053513741
BAKKEN11-20172819318191461859723316156818995
BAKKEN10-20175923931310111426914
BAKKEN9-20172911551079192139461084
BAKKEN8-20171136235710243911469
BAKKEN7-201729123012481641484336252
BAKKEN6-2017301343144616716220731
BAKKEN5-201731121812821581469483194
BAKKEN4-201723857742318103449259
BAKKEN3-201731140614552141697113490

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The well:
  • 19298, 463, MRO, Luther USA 11-16H, Reunion Bay, t2/11; cum 454K 8/19;
Selected:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-2019312207421925924321856020556
BAKKEN7-201940002340220
BAKKEN6-20190000000
BAKKEN5-20190000000
BAKKEN4-20190000000
BAKKEN3-2019118625015014
BAKKEN2-20191512671170237121101020

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The well:
  • 20051, 1,169, MRO, Red Feather USA 21-17H, Reunion Bay, t12/11; cum 339K 8/19;
Selected:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193112575125301398412939012106
BAKKEN7-20193013436134321599913829012938
BAKKEN6-201912363937228888332303081
BAKKEN5-2019178150911027129794607406
BAKKEN4-2019514754129119146801252
BAKKEN3-20190000000
BAKKEN2-201943068261913910343
BAKKEN1-201931345444621424359720971061

As Predictable As The Sun Coming Up In The East -- "Advantaged Oil" In The Bakken -- October 14, 2019

The well:
  • 20050, 1,226, MRO, Red Feather USA 31-17H, Reunion Bay, t2/11; cum 347K 8/19
Full production profile at this post.

Look at this jump in production. The jump in production was greater than the production at the time of the original frack. At the time of the original frack, this well producing only 11,000 bbls in the first full month of production. Compare that to 24,000 bbls in July, 2019, when this Bakken well was already eight years ago.
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193120419203512058629879028508
BAKKEN7-20193023792237652231834613033011
BAKKEN6-20198289830074751379803602
BAKKEN5-201917985197264210912832012172
BAKKEN4-20190000000
BAKKEN3-20190000000
BAKKEN2-2019001770000
BAKKEN1-201921117617061721270715362

Again, talk to me about the dreaded Bakken decline. LOL.

Fracking And Sand -- October 14, 2019

One of the things I hear over and over about fracking: the key is "more sand."

Nope.

Case in point:
  • 35320, 7,811, MRO, Reyes USA 21-16H, Reunion Bay, t6/19; cum 82K in 30 days; cum 179K 8/19; almost 200K in little more than three months; no geologist's narrative available;
Frack:
  • a relatively modest 7.954 million lbs of sand (remember the EOG and CLR mega-fracks of 15 million and 20 million lbs of sand before we went to "advantaged oil" -- I love that term); and,
  • only 40 stages (compared to the industry's push to 60+ stages)
Nope, simply "more sand" is not the end-all and be-all to fracking.

Frack data for three other wells:
  • Eunice, Three Forks: 40 stages; 6.459 million lbs
  • Sears, Three Forks: 40 stages; 6.538 million lbs
  • Driftwood, middle Bakken: 45 stages; 8.538 million lbs
******************************
Another Example

The well:
  • 20359, 96 (no typo), WPX, Bear Den 24-13H2, middle Bakken; Spotted Horn, 12 stages; 2.7 million lbs, t10/11; cum 512K 8/19;
Note: this well was drilled back in 2011; the frack was only 12 stages and less than three million lbs of sand and yet the well has produced more than 500,000 bbls of oil.

Staggering -- October 14, 2019

This page will not be update; these wells are followed elsewhere.

Back in August we first reported some incredible MRO wells in Reunion Bay. Let's see how they are doing. These are just four of the eight that could be posted here. At only 60,000 bbls in its first full month of production, Eunice was somewhat of a laggard among these wells.

35319, Three Forks, Sears:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193134454343722430343706041362
BAKKEN7-20192939766399552591627653025020
BAKKEN6-20192971916715757237872425067595
BAKKEN5-2019200659000

35320, middle Bakken, Reyes:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193143938438332796052714049734
BAKKEN7-20193050405505993370851359047965
BAKKEN6-20193081754815095624856851051444
BAKKEN5-20194303528936267000

35322, Three Forks, Eunice:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193137476373764129634006031502
BAKKEN7-20193140188403144021843092040378
BAKKEN6-20192759075598747300748988045053
BAKKEN5-201910230282194933837000

35323, middle Bakken, Driftwood:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN8-20193150555503532634254529051176
BAKKEN7-20193041535418152666947140044373
BAKKEN6-20193065754658074817964043059679
BAKKEN5-20191032090316832429630827028703

Unleaded Gasoline In North Texas -- DFW Area: $2.159 -- October 14, 2019 -- Ten Wells Coming Off Confidential List -- Is NDIC Closed Today?

North Texas gasoline at $1.16/gallon over the weekend, and that was before the 2% drop in WTI overnight, now trading at $53.58 before the market opens on this Columbus Day holiday, which, of course, will soon be replaced by .... well, something else.

Active rigs:

$53.5810/14/201910/14/201810/14/201710/14/201610/14/2015
Active Rigs5867593166

Wells coming off the confidential list over the weekend, today -- Monday, October 14, 2019: 41 for the month; 41 for the quarter:
  • 36016, SI/NC, WPX, Bison 27-34HEL, Eagle Nest, no production data;
  • 35715, SI/NC, WPX, Nancy Dancing Bull 1-36HW, Mandaree, no production data;
  • 34970, 1,651, CLR, Rader 8-24H, Avoca, t7/19; cum 44K 8/19;
  • 34969, 1,096, CLR, Rader 9-2H1, Avoca, t7/19; cum 33K 8/19;
Sunday, October 13, 2019: 37 for the month; 37 for the quarter:
  • 35950, SI/NC, XTO, Bronson 31X-14D, Temple, no production data yet;
  • 34946, 1,319, Whiting, Moline 44-10-1TFH, Tyrone, t5/19; cum 91K 8/19;
  • 34924, 1,648, CLR, Collison 11-23H, 44 stages; 10.4 million lbs; Avoca, t7/19; cum 60K 8/19;
  • 30647, IA, CLR, Sorenson 7-16H2, Alkali Creek, t--; cum --;
Saturday, October 12, 2019: 33 for the month; 33 for the quarter:
  • 35714, 2,798, WPX, Nancy Dancing Bull 1-36HE, Mandaree, t8/19; cum 62K in two months; and here's the frack data: 33 stages; 8.7 million lbs;
  • 30648, 1,716, CLR, Sorenson 5-16H, Alkali Creek, t9/19; cum --;
RBN Energy: northeast gas prices take shoulder-season hits (whatever that means.)
Despite pipeline takeaway constraints being relieved this year, Northeast natural gas prices have averaged lower than last year through much of the injection season. They’ve been especially weak in recent weeks, with spot prices at Appalachia’s Dominion South hub averaging $1.27/MMBtu in October to date, which is about half of where they stood this time in 2018 and the lowest in two years. And earlier this month, on October 4, regional prices went into apocalyptic territory, plunging 30-50% to less than $1/MMBtu — reminiscent of the deep discounts of recent years when Marcellus/Utica producers were operating under severe pipeline constraints. Prices rebounded the very next trading day, but they remain depressed relative to last year. Today, we look at the fundamentals behind the recent price weakness. Starting today, you can also tune into an audio version of the current day’s blog.
So, quick: what does "shoulder-season" mean? 

Something To Think About On A Holiday (Sort Of) Monday -- October 14, 2019

Updates

Later, 8:15 p.m. CT: in the original post, I stated that the "OPEC figures were generated by OPEC." Apparently that is not entire correct. See first comment. A reader clarifies how OPEC figures are arrived at. For the full comment, scroll down to comments. This is the first part of a longer comment:
OPEC is aware that self-reported production figures from their members would be suspect, so instead of those they use an average of estimates from six "secondary sources," namely the IEA, the EIA, Platts, Argus, Cambridge Energy Research Associates (CERA) and the industry newsletter Petroleum Intelligence Weekly for the production they report ...
... the Saudis, facing the IPO, reported much less damage to production from the drone attack than the official OPEC figures showed ...

... the demand estimates are their own, and they're widely followed & reported on .... estimates are always a crapshoot, but they have to make them as good as they can because their credibility is on the line... 
 Again, see comments for the rest of that comment.

Original Post

From overnight, from a reader who probably follows global oil and natural gas trends more closely than anyone. The reader suggests he may be the first one reporting this:
OPEC has estimated that during the 3rd quarter of this year, all oil consuming regions of the globe have been using 100.70 million barrels of oil per day, which was revised from their estimate of 100.63 million barrels of oil per day for the 3rd quarter a month ago....
... meanwhile, from OPEC's own figures, OPEC and the rest of the world's oil producers were only producing 97.32 million barrels per day during September, which means that there was a shortage of around 3,380,000 barrels per day in global oil production when compared to the demand estimated for the month...
... in addition, the downward revision of 150,000 barrels per day to August's global output that's implied in OPEC's report, combined with the 70,000 barrel per day upward revision to 3rd quarter demand, means that the 1,450,000 barrel per day shortfall that we had originally figured for August based on last month's figures would now have to be revised to a deficit of 1,670,000 barrels per day....
... similarly, the 70,000 barrel per day upward revision to 3rd quarter demand means that the 2,220,000 barrel per day shortfall that we had originally figured for July would have to be revised to a deficit of 2,290,000 barrels per day....
... thus, he oil supply deficit for the 3rd quarter as a whole has averaged nearly 2,440,000 barrels per day...
and then this zinger:  notably, OPEC production was down 4 million barrels per day from a year ago...of course, half of that was the Saudis...but half of it wasn't..

Note:
  • those are OPEC's own figures
  • this comes at a time when Saudi is still recovering from "that" attack
  • the Mideast is flaring up again, not cooling down
  • sanctions on some oil-producing countries (Iran, Venezuela) continue to tighten with no end in sight
Ignoring the numbers, what I found most interesting about the article:
  • global demand for August was revised upward
  • half of OPEC's decreased production stemmed from outside Saudi Arabia
 It will be interesting if the EIA, the AP, Bloomberg, Reuters picks up on this.

************************************
Notes to the Granddaughters

As I writing the subject line, ".... on a holiday (sort of) Monday...." I was  reminded of the wonderful holidays I had when I was on temporary duty in northern England between 2002 and 2004. Yorkshire, England.

My most memorable single-day Monday holiday: visiting Haworth, England. Brontë - ville.

It was also this time of year that meteor-watching / meteor-gazing was at its best. Wow, those were wonderful days.

Meanwhile, here in north Texas: pollen season. Riding my work into work and I end up sneezing for about an hour after reaching my destination.