There are 746 wells on the NDIC confidential well list, for those who are keeping track. This number has not changed much over the past few months.
Today, March 10, 2010, is the 69th day of the calendar year. NDIC has granted 224 permits this calendar year. That puts us on track for 1,185 permits for 2010.
For comparison, here are the numbers for the past four years. The number in red is the total number of permits issued that year. The number in parentheses is the number of permits that were executed (drilled) and have come off the confidential list -- many (most?) wells are not drilled the year of the permit.
2006: 422 (195)
2007: 497 (336)
2008: 953 (734)
2009: 626 (208).
Obviously the numbers inside the parentheses (wells drilled) will increase over time (as the wells are drilled and come off the confidential list).
A few of the permits have been canceled or expired, but it is (was) only a handful.
The rest is "back of the envelope calculations" and is subject to interpretation: From 2006, approximately 200 permits are yet to be drilled/reported; for 2007, about 160; for 2008, about 200; and for 2009, 400. Thus, from 2006, there is a backlog of about 960 wells yet to be reported, not counting those in 2010. And completed wells permitted in 2010 are still on the confidential list. Adding the 224 permits for 2010 and the 960 permits (2006 - 2009, inclusive), that makes about 1200 permits/wells. Minus the approximately 750 confidential wells, that makes 450 permits yet to be acted upon. Those 450 wells plus another 1000 new permits this year and "we" have almost 1500 permits that could be in play for 2010.
Today, there are 102 active rigs in North Dakota.
BEXP cancelled 2 permits in the Alger field today.
ReplyDelete# 18706 & 18721 no reason given, however 18706 was being contested by Hess.
Bexp has most of the permits nearby so i'm not sure what is going on.
In the docket one company or another is appling to set the rules for the field.
I wonder if these are posted anywhere and who gets to set the rules for a field?
Just wondering with so many permits out there what is going on with these two?
Some time ago, a less-well followed company canceled about seven (7) permits in one day; I was concerned. Later it was explained that the state had changed the spacing in that area, from 640-acre spacing to 1280-acre spacing. So, it was no big deal. These companies would just cancel those 640-acre permits and go back in with requests for 1280-acre spacing permits.
ReplyDeleteThere is a lot of jockeying among the oil companies, but a) NDIC seems to be very fair; b) even if one loses a permit, that alone doesn't affect the ownership of the acreage; which leads to c) the companies will jockey among themselves who operates the well, but everyone with mineral rights will participate.
As you noted, the NDIC is looking at making sweeping changes in the spacing units for horizontal wells. See the March "dockets."
Canceling of permits doesn't happen often, but it is not unusual. It is just part of the jockeying that goes on between and among oil companies.