Breakdown of the 1,180 Wells on the Confidential List -- North Dakota, USA

Rory sent me this information earlier today, but I finally found time to post it.

Thank you, Rory.

There are currently 1,180 wells on NDIC's confidential list (remember, not all wells are placed on the confidential list).

Here is the breakdown of the top 20 or so:

• CLR: 140 
• XTO: 79 
• EOG: 65
• Petro-Hunt: 63
• Marathon: 52 
• BEXP: 51 
• Slawson: 51
• Newfield: 45
• BR: 44
• Encore: 36
• Hess: 36
• AEZ (now owned by Hess): 30
• Tracker: 30 (all or some owned by Hess)
• Samson Resources (not SSN): 28
• Zenergy: 26
• KOG: 25
• Zavanna: 25
• Whiting: 23 
• Hunt: 21
• Oasis: 19
• Peak: 18
• SM: 18
• North Plains: 17
• Fidelity: 16
• QEP: 16
• OXY USA: 15
• Anschutz: 14 (now owned by OXY)
• Zenergy: 14
• Helis: 12
• Sagebrush: 11

other selected producers:

• Enerplus: 8
• Oil for America: 6
• Hess: 1

I don't know about "you," but I find 1,180 wells on the confidential list to be absolutely phenomenal. One has to remember there are about 5,000 active wells in North Dakota right now. I don't know if these 1,000 are part of that number or not. Regardless, it's a healthy percentage.

Breakdown of the 168 Active Rigs in North Dakota

Rory sent these to me earlier today; I finally got around to posting them.

Thank you, Rory.

The 168 active rigs in North Dakota:

• CLR: 23
• WLL: 15
• EOG: 9
• Hess: 8
• AEZ: 7
• BEXP: 7
• Newfield: 7
• Oasis: 7
• Petro-Hunt: 7
• XTO: 7
• Encore: 6
• Marathon: 6
• Slawson: 6
• Anschutz: 5
• Burlington: 5
• Samson Resources (not SSN): 4
• Hunt: 3
• Murex: 3
• Tracker: 3
• Zenergy: 3
• Baytex: 2
• KOG: 2 
• North Plains: 2
• OXY USA: 2
• QEP: 2
• Zavanna: 2

The following each had one (1) active rig in North Dakota today: Arsenal, Core 54, Cornerstone, Enerplus, Fidelity, G3, Helis, Legacy, Oil for America, Peak, Prima, Sinclair, and SM.

I know several of these companies have had more active rigs than the number they are reporting today, and some companies have announced they will be bringing in additional rigs this year.

So, when the stars align, "we" will easily go over 170 rigs in the near future.

Denbury Increases Reserves by 92 Percent in 2010 -- Bakken, North Dakota, USA

The press release is filled with data.

The pertinent Bakken components:

... 33.4 million barrels of oil equivalent from the development of its Bakken properties, ... Year-end proved reserves of the Denbury's Bakken properties are 46.7 million barrels of oil equivalent ...

.... Denbury's net average prices contained in the reserve report were approximately $74.36 per barrel of oil and $4.29 per thousand cubic feet of natural gas. Using these prices, the estimated discounted net present value of Denbury's proved reserves, before projected income taxes, using a 10% per annum discount rate (“PV-10 Value”) was $7.3 billion at December 31, 2010, as compared to a PV-10 Value of $3.1 billion a year earlier.

This increase is primarily due to the 2010 additions to reserves discussed above [which included but not limited to Denbury's buyout of Encore in the Bakken] and a 27% increase between the average net oil prices in the 2009 reserve report and those in the 2010 reserve report.

In May, 2010, Denbury shares could be had for $19. Today they are in the $20 range. The Denbury acquisition of Encore closed on December 31, 2010.

Morgan Kinder

Yesterday I happened to  mention, in passing, three pipeline companies: Enbridge, ONEOK, and Kinder Morgan.

Today Kinder Morgan announced its parent company, Kinder Morgan Holdco LLC, plans to raise $2.2 billion in the largest initial public offering by a US energy company in 13 years.

This is another indication that this will be the decade for energy.

Great News for the Bakken -- Bad News for US Consumer

Shell Alaska (oil) will not drill in the Alaskan Arctic in 2011. The EPA remanded ("took back") the air waiver that it had previously granted Shell to drill in the Alaskan Arctic.

So now Shell will wait at least until 2012 to drill.

Alaska receives 90 percent of its general fund revenue from the petroleum industry, and state officials aren't happy with this turn of events.

U.S. Sen. Mark Begich, Dem-Alaska, blamed the Obama administration and the EPA.

"Their foot dragging means the loss of another exploration season in Alaska, the loss of nearly 800 direct jobs and many more indirect jobs," Begich said. "That doesn't count the millions of dollars in contracting that won't happen either at a time when our economy needs the investment."

The Alaskans voted out the longest serving Republican member of the US Senate of all time when they voted Mark Begich into office. Anything to destroy the domestic oil industry. I guess some actions have consequences.

It gets worse. The trans-Alaska pipeline must meet adequate capacity to keep it viable. If oil volume decreases below a certain point, it risks freezing and won't flow. As it is, the pipeline now operates at about one-third capacity, and operators have looked to offshore sources to keep the pipeline viable.
Alaska governor Sean Parnell noted:

... it was unfathomable that a company could buy federal leases but not get onto them within five years.

"It's also unfathomable that they cannot get an air permit after five years when they can get one in the Gulf of Mexico within months," he said.

I think under the current administration that is no longer accurate. The Gulf is under a "permitorium" for any further drilling.

It appears the Alaskans have re-elected a very courageous, prescient, and outspoken critic of the Obama administration:

Republican U.S. Sen. Lisa Murkowski said actions taken by the Obama administration will result in higher gasoline prices and a loss of jobs and revenue.

Well, duh.

Now, go back and look at the graph at this site, and overlay this Shell news on the Alaskan downward sloping line.

It's just a matter of time before North Dakota out-produces Alaska.

Unless the EPA halts fracking.

**********

If you've read this far, you might as well know that GE was granted a waiver from complying with the EPA's new rules for greenhouse gas emissions from any new or expanded power plants. GE was granted the first exemption under the new rules.

The Obama administration will spare a stalled power plant project in California from the newest federal limits on greenhouse gases and conventional air pollution, U.S. EPA says in a new court filing that marks a policy shift in the face of industry groups and Republicans accusing the agency of holding up construction of large industrial facilities.

According to a declaration by air chief Gina McCarthy, officials reviewed EPA policies and decided it was appropriate to "grandfather" projects such as the Avenal Power Center, a proposed 600-megawatt power plant in the San Joaquin Valley, so they are exempted from rules such as new air quality standards for smog-forming nitrogen dioxide (NO2).

It should be noted that the GE/CEO was recently (like last week) appointed President Obama's new economic czar. And President Obama needs California electoral votes in 2012.

This is not rocket science.

Thirteen (13) New Permits -- North Dakota, USA

Producers: Oasis (3), Anschutz (2), Whiting (2), Zavanna, KOG, Zenergy, Sinclair, Marathon, and XTO

Fields: Moccasin  Creek, Sanish, Bull Butte, Murphy Creek, Foreman Butte, Sanish, Russian Creek, Heart Butte, and four wildcats.

Two of the three Oasis wells will be on the same pad in Bull Butte, 10-156-103.

Again, true to form, WLL gets a permit in its cash cow (Sanish field) and a wildcat. The wildcat is in McKenzie County, about 10 miles southwest of Watford City. This area is fairly inactive.

The other three wildcats are all in the Williston area. The Oasis wildcat is five miles south of Williston, west (south) of the river. The Zenergy wildcat is about 20 miles north of Williston in a fairly inactive area.

And finally, the KOG permit, a wildcat, is for a well in a section where KOG already has a well/permit on the confidential list. It will be placed on the same pad.

There were a number of wells released from confidential status, three of which were particularly remarkable:

• 19183, 1,171, Continental Resources, Dalin 1-4H, Divide County 
• 18313, 1,052, Petro-Hunt, Berthold 148-94-35D-26-1H, Dunn County
• 19008, 2,804, BEXP, Brakken 30-31 1H, Williams County. This one had been reported out elsewhere with an IP of 3,574.  It is not uncommon for reported IPs from the same wells to be at variance due to various sources and methods of calculating.

Four Hess Wells Off Confidential List -- Bakken, North Dakota, USA

Four Hess wells came off confidential list today, but they just don't get me excited:

• 19017, 91, Hess, AV-Kimball-162-95-1102H-1, Wildcat, Bakken, far north of Tioga, east of Ambrose
  18873, 345, Hess, EN-Ortloff-156-94-2635H-1, Big Butte, Bakken
  18820, 584, Hess, HA-Rolfsrud-152-96-1720H-1, Westberg, Bakken
  18775, 511, Hess, EN-Fisher-157-94-2116H-1, Pleasant Valley, Bakken

They are all in different fields, and based on IPs, rather mediocre.

Encore reports a nice well just south of Williston, just west of US Highway 85:

• 18949, 1,524, Encore, Joseph 11-1H, Indian Hill, Bakken

List of wells coming off confidential and reporting IPs can be found  here.

168 Active Rigs Today -- North Dakota, USA

A reader alerted me. Thank you.

That is either a new record or ties a record. There was some confusion in an earlier news story.  The confusion arose from an AP story which said North Dakota had 168 active rigs the previous week, though none of us who follow the Bakken closely noted a number higher than 166 at that time. Regardless, 168 is the high for number of active rigs in North Dakota.

Be that as it may, it is clear that there has been as many as 168 active rigs, albeit it seems for very short periods of time.

There's no question in my mind that we will soon see 170 active rigs in North Dakota.

167 Active Rigs Today

A reader alerted me. Thank you.

Great Story on the Bakken -- North Dakota, USA

A reader alerted me to this story: something to read while waiting for the daily news cycle to begin.

Perhaps more comments later; I have to get going. Nothing one didn't know, but still "fun" to read.

First paragraph from the story:

Quick—which state produces more oil: Alaska or California? That’s easy. Alaska, du-uh. And that’s wrong. California passed Alaska in daily oil production in June last year (561,000 bbls per day for CA; 533,000 bbls per day for AK).

This isn’t because California has opened new fields or increased production from old ones. Far from it. California’s oil production continues its slow, long-term slide, down 49.1 percent from its peak production level of 1.1 million barrels per day in February 1986. But Alaska’s production has declined even more, down 74.2 percent from its peak of 2 million barrels a day in 1988 (when Alaska only briefly exceeded Texas as our leading oil-producing state).

And later:

But the biggest story in domestic oil production is . . . North Dakota. New fields in North Dakota, also mostly on private land, have seen its oil production increase 138 percent since January 2008 to 329,000 barrels a day. North Dakota has blown by Oklahoma and Louisiana to become America’s fourth-largest oil-producing state.

And for investors in energy, another story nice to read. This one, a Financial Times, reporting what we already know: shares in energy companies have had a huge run the past six months.

Update on the Spearfish in the Bottinea Area -- North Dakota, USA

Since I know a lot of folks don't go back and read comments at earlier posts, this is a note to let folks know there is an interesting comment providing a bit of background to the EOG experience in the Bottineau/Spearfish prospect. When you get to the link, read the comment dated February 3, 2011. The link may take you to my reply; if so, go up to the comment from the reader.

Some Selected 2010 Data Points on North Dakota Oil Permits / Wells

Until the daily news cycle begins, some data points from my 2010 database of permits issued by the NDIC.

• In calendar year, NDIC issued 1,680 new permits.
• Of those permits, 19 have been canceled.
• Of those 1,680 permits, there is some kind of data for 467

(IPs, plugged or producing, dry, TD, suggesting they have been drilled, not necessarily completed. It is unknown how many more have been drilled or are in the process of being drilled but remain on the confidential list.)

By county, the number of permits issued in calendar year 2010:

• Mountrail, 430
• Williams, 337
• McKenzie, 329
• Dunn, 250
• Divide, 99
• Burke, 63
• Bottineau, 60
• Stark, 44
• Billings, 27
• McLean, 12
• Renville, 11
• Bowman, 10
• Golden Valley, 5
• Slope, 2
• Ward, 1

Top IPs and their producer, highest to lowest (I don't know the exact number, but CLR has about 22 rigs in the ND Bakken; WLL has about 15; and, BEXP had 7 in 2010. I believe KOG had two, maybe three rigs in 2010.)

• 5,061: BEXP
• 4,431, WLL
• 4,357, BEXP
• 4,355, BEXP
• 4,169, BEXP
• 4,106, BEXP
• 3,660, BEXP
• 3,631, Newfield
• 3,573, BEXP
• 3,479, WLL
• 3,445, WLL
• 3,425, BEXP
• 3,311, Newfield
• 3,301, BEXP
• 3,293, WLL
• 3,240, BEXP
• 3,206, BEXP
• 3,191, BEXP
• 3,090, BEXP
• 3,070, BEXP
• 2,984, WLL
• 2,973, WLL
• 2,803, BEXP
• 2,788, WLL
• 2,746, WLL
• 2,731, Fidelity
• 2,707, Oasis
• 2,686, WLL
• 2,674, Newfield
• 2,658, BEXP
• 2,640, BEXP
• 2,579, Helis
• 2,573, XTO
• 2,551, WLL
• 2,519, Newfield
• 2,497, Newfield
• 2,472, BEXP
• 2,444, WLL
• 2,435, CLR
• 2,417, BEXP
• 2,413, BEXP
• 2,356, BEXP
• 2,355, Encore
• 2,322, WLL
• 2,312, BEXP
• 2,278, BEXP
• 2,241, WLL
• 2,232, Encore
• 2,213, BEXP
• 2,194, Enerplus
• 2,178, AEZ
• 2,166, WLL
• 2,145, BR
• 2,137, WLL
• 2,110, WLL
• 2,104, Zenergy
• 2,080, AEZ
• 2,035, KOG
• 2,023, Oasis
• 2,000, BEXP
• 1,976, Oasis
• 1,960, Tracer
• 1,959, BEXP
• 1,936, BEXP
• 1,851, CLR
• 1,833, BR
• 1,832, WLL
• 1,780, WLL
• 1,773, BEXP
• 1,770, Slawson
• 1,754, SM
• 1,722, CLR
• 1,719, SM
• 1,713, KOG
• 1,702, CLR
• 1,695, WLL
• 1,694, WLL
• 1,689, BR
• 1,669, WLL
• 1,667, WLL
• 1,659, BR
• 1,639, Hess
• 1,611, WLL
• 1,600, Zavanna
• 1,594, Enerplus
• 1,578, BEXP
• 1,561, WLL
• 1,557, WLL
• 1,546, Slawson
• 1,521, Slawson
• 1,517, Slawon
• 1,507, Newfield
• 1,500, Encore
• 1,490, EOG
• 1,488, Oasis
• 1,481, Oasis
• 1,471, CLR
• 1,447, WLL
• 1,434, Tracker
• 1,415, SM
• 1,407, Slawson
• 1,394, Slawson
• 1,389, WLL
• 1,375, Tracker
• 1,371, Slawson
• 1,358, EOG
• 1,348, Tacker
• 1,330, Slawson
• 1,329, Encore
• 1,325, Tracker
• 1,306, Slawson
• 1,300, CLR
• 1,271, Questar
• 1,248, AEZ
• 1,236, WLL
• 1,219, CLR
• 1,212, Encore
• 1,203, CLR
• 1,201, CLR
• 1,193, Oasis
• 1,172, Slawson

Of the 315 well files for permits issued in 2010 that have reported IPs, the average IP was 1,161

The ten lowest IPs were (IP, producer, county, field):

• 0, EOG, Bottineau, Wildcat
• 1, Sagebrush, Burke, Portal
• 2, Eagle, Burke, Flaxton
• 2, Sagebrush, Burke, Portal
• 2, KOG, Dunn, Heart Butte
• 11, Eagle, Burke, Flaxton
• 22, Hess, Williams, Beaver Lodge
• 25, WLL, Billings, Big Stick
• 28, Baytex, Divide, Ambrose
• 30, Jayhawk, Divide, Crosby

Comments:

• Reported IPs come from various sources: generally press releases, corporate presentations, and NDIC scout tickets
• Some of the larger companies, such as Hess and EOG, generally don't provide early data on IPs (or if they do, I don't find them; but if they are good/great wells, their smaller partners are likely to release pressers)
• Partners on the same well will  often report different IPs for the same well (due to different methods of calcuating); the NDIC scout tickets almost always have a different IP than that reported in the press
• Low IPs may be due to wells that have not been completed, or problems with the wells that might change with a work over
• The data is not official; it comes from my own database; I cannot vouch for its accuracy (due to too many variables); I would not recommend using the data for anything other than looking at it while having a cup of coffee waiting for the day's new cycle to begin

Epping To Get Bulk Storage Plant and Terminal on Rail Spur - North Dakota, USA

Link here (which will be broken shortly; regional newspaper).

The new terminal would serve as a hub for receiving crude by truck and pipeline.

Rangeland Energy of Sugar Land, Texas, is planning to build a bulk storage plant and terminal on the rail spur on the east side of Epping.

The company is acquiring 274 acres for a facility with four components: a truck station, a tank farm, rail loading facility and an outbound pump station.

From there, the oil would be shipped out in two ways

• Through a 21-mile pipeline, the COLT connector, running east to the Beaver Lodge facility
• By rail to the Gulf Coast

The facility is expected to be operational by the end of the year.

Epping is located about 14 miles northwest of Williston, although that distance is decreasing as Williston gets bigger. In the 2000 census, Epping  had a population of 79.