Director's Cut Dated November 12, 2010 -- North Dakota, USA

The NDIC Director has just published his most recent Director's Cut.

Highlights for archival purposes:

Producing Wells: 

• September: 5,197 (all-time high)
• August: 5,115

Oil Produced:

• September: 341,384 bbls (all-time high) (3.8% increase from previous month)
• August: 328,873 
• If "we" were to continue at 4% increase month-over-month, one year from now, North Dakota would produce 546,567 bbls/month in that 12th month from now

Average Price Sweet Crude

• September: $67.95
• August: $69.07
• November 12, 2010: $79.25
• All-time high: $136.29, July 3, 2008)

Williston Basin crude take away capacity remains above production; however, recall that about 6% is trucked north to Canada; and, about 10% is shipped by rail to Cushing.

There are three additional pipeline and rail projects in the review or engineering stages; two that have begun construction; and, one that has extended their open season (taking bids to transport oil).

The delta between North Dakota Sweet (posted) and West Texas Intermediate (posted) has increased slightly, to just over 10 percent.

Despite all the new pipeline laid, natural gas production continues to outstrip infrastructure, and flaring (which I -- this blog's author -- believe is highest in the nation) is still well above normal.

New Record: 158

After I missed the "record" of 157 active rigs -- someone else alerted me to it -- I have been checking twice a day to see if "we" would hit 158.

And it appears I missed that record! Someone just alerted me -- Friday night, November 12, 2010 -- the Director's Cut (NDIC/Director) which was just published today.

The Director mentions that the record of 158 was hit on November 11, 2010, but that today (November 12, 2010) the number of active rigs had fallen back to 156. Talk about ephemeral.

In a separate post, I will hit the high points of the latest Director's Cut, for archival purposes.

Anyway, "we" have a new record: 158 active rigs in North Dakota.

By the way, that makes sense: BEXP's seventh rig was missing in the "old record" of 157.  I haven't yet had a chance to check out to see if I can find the 158th rig.

Oil and Natural Gas Production

This is an incredible graph, presented at the 2010 World Energy Outlook.

This graph represents only two fossil fuels, oil and natural gas. The bottom three shaded areas all concern various aspects of oil production: a) currently producing oilfields; b) development of known oil fields; and, c) development of oil fields yet to be discovered. Even with all three oil entities, total oil production levels off in the out years. The moratorium in the Gulf of Mexico affects both current production and development of new fields.

The Chesapeake Corporation has stated there are no more large oil (or gas) fields to be discovered in North America.

This is another fascinating graph depicting likely crude oil production over the next five years (within my investing lifetime).

On another note, just how reliable / credible is the statement often made by the Saudis? Read the author's four propositions for interpreting this graph.

Eight (8) New Permits -- North Dakota, USA

Operators: Zavanna (2), Petro-Hunt (2), Armstrong, CLR, Fidelity, and Newfield.

Fields: Charlson, Stanley, and six (6) wildcats.

Four of the wildcats are in Williams County. The Armstrong wildcat is in Stark County.

Stark County is certainly getting busy.

Troops To Stay In Iraq Past "Deadline"

I guess this is the last campaign promise to go by the wayside, unless one counts ending the extension of the Bush tax cuts.

Just saying.

I don't know how long this link will remain, but it's the ABCNEWS.com evaluation of the president's trip to Asia: Strike 1, strike 2, and strike 3.  Irrelevant is the word that comes to mind.

And this is what The (London) Telegraph has to say about the president:

Looking at the 43rd and 44th American presidents right now, it is worth reflecting that it was only the unpopularity of Bush and all he represented that enabled someone as inexperienced and unproven as Obama to ascend to power.

By the same token, perhaps only a performance in office as myopic, self-absorbed and hubristic as that of Obama could have brought about a Bush rehabilitation so swiftly.

And, now, irrelevant.

Oil Demand Forecast Raised Again

One month ago, October 13, 2010:

OPEC now sees world oil demand growth of 1.32 million b/d or 1.6% to 85.78 million b/d for 2010, compared with 1.3% previously, while demand growth will increase by a further 1.17 million b/d or 1.4% to 86.95 million b/d in 2011, instead of by 1.2% as earlier expected.

Today, just one month later:

The IEA said in its monthly report that oil demand next year will reach 88.2 million barrels a day, up from its forecast last month of 87.9 million barrels a day, based on the latest economic forecast from the International Monetary Fund earlier this month.

Yup.

XOM and CVX See Natural Gas as Fuel of the Future

I will post this link under "NG" tab above on the right, so you don't need to bookmark this page.

This is quite interesting from RIGZONE.COM today: XOM sees natural gas as the fuel of the future.

This explains XOM's recent purchase of XTO and Chevron following suit earlier this week, albeit smaller deal, by announcing its intention to acquire Atlas Energy, major player in the Marcellus shale (natural gas).

Very, very interesting.

MDU Increases Dividend for 20th Consecutive Year

But just barely: one-half cent/share. But that little increase moves the annual dividend from 63 cents to 65 cents, yielding about 3.1%.

MDU is a very nice holding for long term investors.