Wednesday, August 25, 2010
Overview of the Bakken
Just a reminder: the "Running With Oil" series is now complete. It is also linked on the sidebar on the right, near the top, as part of this site's "welcome" page.
Definition of Pooling As It Relates to Leases
This may be a good link for those interested in the definition of "pooling" as noted on the NDIC Nearing Dockets.
Salmonella and Eggs: Nothing To Do With The Bakken
The culpability of the federal government in the salmonella-egg recall is stunning and reveals the depth of bureaucratic morass in Washington.
The Brits mandated a "hen vaccine" some years ago which, for all practical purposes, eliminated the risk of salmonella in eggs.
Had the vaccine been mandatory here in the U.S., it would have eliminated the need for a lot of federal food inspectors, I suppose. And so it goes.
My rant for the day. I could also talk about the ineptitude of government analysts but I will let that slide for now.
This has nothing to do with the Bakken except for the fact that federal regulators ....
The Brits mandated a "hen vaccine" some years ago which, for all practical purposes, eliminated the risk of salmonella in eggs.
Had the vaccine been mandatory here in the U.S., it would have eliminated the need for a lot of federal food inspectors, I suppose. And so it goes.
My rant for the day. I could also talk about the ineptitude of government analysts but I will let that slide for now.
This has nothing to do with the Bakken except for the fact that federal regulators ....
CAPEX Costs Force Divestiture, Others Get Foot in Door
Several Bakken companies have announced aggressive CAPEX plans this past year. To raise the necessary cash, some companies have had to sell assets in the Bakken.
This provides an opportunity for other companies, not always oil companies, to get a foot inside the Bakken door.
In addition, it provides investors, surface owners, and mineral rights owners an idea of how to estimate value of their holdings.
In this story, SM Energy sold Bakken reserves to a partnership between GE Financial and Sequel Energy LLC.
In this particular deal, SM Energy sold 20 million boe in proved reserves and 3,000 bopped production for $137 million. The buyers got the reserves for $6.85/barrel, and the production for free.
This provides an opportunity for other companies, not always oil companies, to get a foot inside the Bakken door.
In addition, it provides investors, surface owners, and mineral rights owners an idea of how to estimate value of their holdings.
In this story, SM Energy sold Bakken reserves to a partnership between GE Financial and Sequel Energy LLC.
In this particular deal, SM Energy sold 20 million boe in proved reserves and 3,000 bopped production for $137 million. The buyers got the reserves for $6.85/barrel, and the production for free.
One Million Barrels Per Day?
North Dakota currently produces aboout 300,000 barrels of oil per day, up from 100,000 not long ago. Now some analysts think North Dakota's oil production could soar to one million barrels daily.
I was under the impression that the takeaway capacity was pretty much balanced with the oil production in North Dakota. That may be true, but only because so much of the oil is trucked (which also explains the huge delta between price of Texas crude and North Dakota crude).
Confirming an earlier post of mine, which I think was picked up by a well-known business blog, Enbridge has announced plans for a significant increase in pipeline capacity. Enbridge will add 145,000 bopd takeaway.
This is a huge story for those who still think the Bakken is over-hyped.
This is also a headline story in the Oil and Gas Financial Journal.
I was under the impression that the takeaway capacity was pretty much balanced with the oil production in North Dakota. That may be true, but only because so much of the oil is trucked (which also explains the huge delta between price of Texas crude and North Dakota crude).
Confirming an earlier post of mine, which I think was picked up by a well-known business blog, Enbridge has announced plans for a significant increase in pipeline capacity. Enbridge will add 145,000 bopd takeaway.
This is a huge story for those who still think the Bakken is over-hyped.
This is also a headline story in the Oil and Gas Financial Journal.
North Dakota Seeks Federal Help For Housing, Other Growth Issues
Small communities across western North Dakota are asking for federal help with housing and other growth issues.
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