Great videos of the heart of the Bakken, Williston, North Dakota.
It's really an incredible site for those who enjoy travelogues.
This will be linked at the "Welcome" tab at the top of the blog.
Thursday, February 24, 2011
BEXP Quadruples Net Income Year-Over-Year -- After-Tax Earnings Quintuples
BEXP reported net income for 4Q10 was $13.8 million ($0.12 per diluted share) versus net income of $2.5 million ($0.03 per diluted share) for the same period last year.
BEXP's after-tax earnings in 4Q10 excluding the loss on the early redemption of our Senior Notes due 2014 and unrealized mark-to-market hedging losses were $25.4 million ($0.21 per diluted share) as compared to our after-tax earnings in the fourth quarter 2009 excluding our unrealized mark-to-market hedging losses were $3.8 million ($0.04 per diluted share).
Link here.
BEXP's after-tax earnings in 4Q10 excluding the loss on the early redemption of our Senior Notes due 2014 and unrealized mark-to-market hedging losses were $25.4 million ($0.21 per diluted share) as compared to our after-tax earnings in the fourth quarter 2009 excluding our unrealized mark-to-market hedging losses were $3.8 million ($0.04 per diluted share).
Link here.
North Dakota Now Exceeds Libya's Oil Production
That may not be entirely accurate (that North Dakota now exceeds Libya's oil production) but I bet I'm not far off.
OGJ reports that:
North Dakota is producing about 365,000 bopd. Production is being artificially restricted for any number of reasons, and it's very possible North Dakota is closer to the 400,000 bopd threshold than Libya is each day the conflict continues.
OGJ reports that:
Due to the continued violence sweeping the country, Libya’s oil production has decreased by 75% to around 400,000 b/d from the normal 1.6 million b/d, according to Paolo Scaroni, Eni SPA chief executive officer.I would assume that when the story was written some oil that was still in the pipeline has now been offloaded. With the continued conflict, production is dropping further. In addition, it's been my experience that folks try to put the best face on things, and there may be a bit of exaggeration that Libya is still producing even that much oil.
North Dakota is producing about 365,000 bopd. Production is being artificially restricted for any number of reasons, and it's very possible North Dakota is closer to the 400,000 bopd threshold than Libya is each day the conflict continues.
BEXP Announces Its Smart Pad Concept -- Bakken, North Dakota, USA
Smart Pad Development
It sounds like BEXP is going to pursue a "smart pad" concept not unlike CLR's Eco-Pad.
Brigham announced that it has initiated utilization of smart pad development in its Rough Rider and Ross project areas. Smart pad development can be implemented either by drilling multiple wells from the same location in a single spacing unit or by drilling stacked 1,280 acre spacing units, one to the north and one to the south, and drilling multiple wells in both spacing units from the same location. Smart pad development, once fully implemented, is anticipated to save approximately 10% to 20% per well on drilling and completion capital expenditures. Furthermore, smart pads are expected to reduce surface footprints and allow for consolidation of equipment and services into centralized facilities.
Density Wells
BEXP feels the Williston Basin can support eight wells on a 1280-acre unit. That assertion increases the number of net drilling locations for BEXP from 590 to 782. Conservatively, if the EUR/well is 250K (analysts say Bakken EURs are 500,000 to 750,000), that 250K x $75/bbl = $20 million (rounding). 782 - 590 = 192 additional wells x $20 million = $4,000 million (rounding). The numbers are staggering. Again, I used a very conservative EUR.
Drilling Activity
BEXP anticipates drilling approximately 66 net Bakken and Three Forks wells in 2011 compared to 39 in 2010. The cost per well is estimated at $8 million (rounding).
Recent Results
Swindle 16-9 1H, Roosevelt County, Montana, 1,065 bopd early 24-hour peak flow back; 19-fracture stages; less than expected due to technical problems. Approximately 3,200 feet of the outermost wellbore was completed with a single hole fracture stimulation. The average length of a long lateral is about 9,000 feet, so more than a third of the horizontal was suboptimally fracked.
BEXP is fracture stimulating another Montana well, the Johnson 30-19, with 30 fracture stages; this well is in Richland County, where the current Montana Bakken boom started in the Elm Coulee.
It sounds like BEXP is going to pursue a "smart pad" concept not unlike CLR's Eco-Pad.
Brigham announced that it has initiated utilization of smart pad development in its Rough Rider and Ross project areas. Smart pad development can be implemented either by drilling multiple wells from the same location in a single spacing unit or by drilling stacked 1,280 acre spacing units, one to the north and one to the south, and drilling multiple wells in both spacing units from the same location. Smart pad development, once fully implemented, is anticipated to save approximately 10% to 20% per well on drilling and completion capital expenditures. Furthermore, smart pads are expected to reduce surface footprints and allow for consolidation of equipment and services into centralized facilities.
Density Wells
BEXP feels the Williston Basin can support eight wells on a 1280-acre unit. That assertion increases the number of net drilling locations for BEXP from 590 to 782. Conservatively, if the EUR/well is 250K (analysts say Bakken EURs are 500,000 to 750,000), that 250K x $75/bbl = $20 million (rounding). 782 - 590 = 192 additional wells x $20 million = $4,000 million (rounding). The numbers are staggering. Again, I used a very conservative EUR.
Drilling Activity
BEXP anticipates drilling approximately 66 net Bakken and Three Forks wells in 2011 compared to 39 in 2010. The cost per well is estimated at $8 million (rounding).
Recent Results
Swindle 16-9 1H, Roosevelt County, Montana, 1,065 bopd early 24-hour peak flow back; 19-fracture stages; less than expected due to technical problems. Approximately 3,200 feet of the outermost wellbore was completed with a single hole fracture stimulation. The average length of a long lateral is about 9,000 feet, so more than a third of the horizontal was suboptimally fracked.
BEXP is fracture stimulating another Montana well, the Johnson 30-19, with 30 fracture stages; this well is in Richland County, where the current Montana Bakken boom started in the Elm Coulee.
BEXP Will Double Rigs in Less Than 18 Months -- Bakken, North Dakota, USA
Operated Rigs
I think it was as recent as mid-2010 when BEXP still had just six operated Williston Basin rigs, with plans to go to eight rigs by 1Q11.
Today BEXP announced it is going to 12 rigs in 2011. So in less than 18 months, BEXP has gone from 6 rigs to 12 rigs.
That's huge.
BEXP expects to bring its eighth and ninth operated rigs into the Williston Basin in May and September, 2011, respectively.
Dedicated Fracking
By mid-April, BEXP expects to add additional fracture stimulation capacity with two fully dedicated frack crews. At that time, BEXP estimates that a minimum of eight wells per month will be fracture stimulated and brought on line to production due to the efficiencies gained by simultaneous stimulations.
Commentary
I have been concerned that the infrastructure won't support 175 active drilling rigs, but it appears I am wrong. BEXP would not be doing this if it didn't feel the infrastructure could support it. Something tells me we will start seeing stories of more fracking crews in the Williston Basin.
They say the "permitorium" in the Gulf does not result in any displacement of workers from the Gulf to the Bakken, but one has to wonder. Perhaps that was true initially, when most folks thought the moratorium would be short lived, but as folks see the deep sea drilling rigs leaving, it's pretty obvious the "permitorium" is not temporary.
Even with all that is going on in the Mideast, there has been no announcement from Washington about re-looking at the "permitorium." And I think some oil service companies are going to move assets from the Gulf to the Bakken.
There will be some competition from the Niobrara in Colorado-Wyoming, but that development will come along more slowly. There will also be some competition from the Eagle Ford in south Texas, but again, that development will come along more slowly.
But for BEXP to double its rigs in less than 18 months, that's quite a story. One has to remember that about two years a lot of folks were wondering if BEXP could survive a cash crunch. BEXP partnered with USEG and came out looking very, very good.
BEXP is moving into the big leagues, along with CLR, WLL, and EOG, in the Bakken.
I think it was as recent as mid-2010 when BEXP still had just six operated Williston Basin rigs, with plans to go to eight rigs by 1Q11.
Today BEXP announced it is going to 12 rigs in 2011. So in less than 18 months, BEXP has gone from 6 rigs to 12 rigs.
That's huge.
BEXP expects to bring its eighth and ninth operated rigs into the Williston Basin in May and September, 2011, respectively.
Dedicated Fracking
By mid-April, BEXP expects to add additional fracture stimulation capacity with two fully dedicated frack crews. At that time, BEXP estimates that a minimum of eight wells per month will be fracture stimulated and brought on line to production due to the efficiencies gained by simultaneous stimulations.
Commentary
I have been concerned that the infrastructure won't support 175 active drilling rigs, but it appears I am wrong. BEXP would not be doing this if it didn't feel the infrastructure could support it. Something tells me we will start seeing stories of more fracking crews in the Williston Basin.
They say the "permitorium" in the Gulf does not result in any displacement of workers from the Gulf to the Bakken, but one has to wonder. Perhaps that was true initially, when most folks thought the moratorium would be short lived, but as folks see the deep sea drilling rigs leaving, it's pretty obvious the "permitorium" is not temporary.
Even with all that is going on in the Mideast, there has been no announcement from Washington about re-looking at the "permitorium." And I think some oil service companies are going to move assets from the Gulf to the Bakken.
There will be some competition from the Niobrara in Colorado-Wyoming, but that development will come along more slowly. There will also be some competition from the Eagle Ford in south Texas, but again, that development will come along more slowly.
But for BEXP to double its rigs in less than 18 months, that's quite a story. One has to remember that about two years a lot of folks were wondering if BEXP could survive a cash crunch. BEXP partnered with USEG and came out looking very, very good.
BEXP is moving into the big leagues, along with CLR, WLL, and EOG, in the Bakken.
Huge, Huge, Huge -- The BEXP Press Release Today -- Bakken, North Dakota, USA
Looking at corporate presentations over the past year, it appeared to me that the Bakken/Three Forks could support eight wells per 1280-acre spacing unit.
Today, BEXP says the same thing.
That's a huge story.
This supports Harold Hamm's assertion that the Bakken/Three Forks has 24 billion barrels of recoverable oil vs the 5 billion or so the USGS says is there.
Two years ago, folks were looking at an average of one well/section.
Then it went to two wells/section. Now we are at four wells/section.
On top of that, BEXP is going to accelerate its drilling program. I believe BEXP started last year (2010) with six rigs and said they would be up to eight rigs in early 2011. It certainly seemed like it took them a long time to get to eight. But the wind has been taken out of my said: BEXP, today, announced that it is going to accelerate to twelve (12) operated Williston Basin rigs in 2011.
That's huge.
Today, BEXP says the same thing.
That's a huge story.
This supports Harold Hamm's assertion that the Bakken/Three Forks has 24 billion barrels of recoverable oil vs the 5 billion or so the USGS says is there.
Two years ago, folks were looking at an average of one well/section.
Then it went to two wells/section. Now we are at four wells/section.
On top of that, BEXP is going to accelerate its drilling program. I believe BEXP started last year (2010) with six rigs and said they would be up to eight rigs in early 2011. It certainly seemed like it took them a long time to get to eight. But the wind has been taken out of my said: BEXP, today, announced that it is going to accelerate to twelve (12) operated Williston Basin rigs in 2011.
That's huge.
Eight (8) More New Permits -- North Dakota, USA
Producers: Zenergy (2), North Plains, KOG, BTA, Fidelity, EOG, and Whiting.
Fields: Sanish, Clarks Creek, Alger, Epping, Pembroke, Mandaree, Truax, and a wildcat.
The Zenergy wildcat is less than two miles southwest of Alexander, about midway between Williston and Watford City.
Otherwise the daily activity report is rather benign.
North Dakota is on track for 1,818 new permits for calendar year 2011.
Fields: Sanish, Clarks Creek, Alger, Epping, Pembroke, Mandaree, Truax, and a wildcat.
The Zenergy wildcat is less than two miles southwest of Alexander, about midway between Williston and Watford City.
Otherwise the daily activity report is rather benign.
North Dakota is on track for 1,818 new permits for calendar year 2011.
BEXP Pumping Water From the Missouri Near Trenton -- Bakken, North Dakota, USA
I am being told that BEXP has started pumping water from the Missouri River, near Trenton. The water, of course, is to be used for fracking.
More to follow.
The big question is whether BEXP and the US Corps of Army Engineers are in discussion or if this even pertains to the Corps.
More to follow.
The big question is whether BEXP and the US Corps of Army Engineers are in discussion or if this even pertains to the Corps.
Where Are The US Marines? From the halls of Montezuma to the shores of Tripoli ....
It is being reported that Americans are stranded because rough seas are preventing evacuation from Tripoli on a "sea-going vessel."
So, the United States is reduced to leasing a "tourist vessel" to evacuate 600 Americans who are now in harm's way.
And the US Marines are not there to provide cover or support, if my assumption is true.
Actions have consequences.
The United States sent the seagoing ferry — a tourist vessel with flat-screen televisions and a small casino — on Wednesday to transport about 600 people, mostly Americans, after being turned down for permission to land a chartered plane in Tripoli. The passengers would remain on the ferry, which has been secured, and were being provided with food and water, according to the report.This suggests that a marine expeditionary force (MEF) that has historically been in the Mediterranean 24/7 for as long as one can remember is no longer there.
So, the United States is reduced to leasing a "tourist vessel" to evacuate 600 Americans who are now in harm's way.
And the US Marines are not there to provide cover or support, if my assumption is true.
Actions have consequences.
China Number One Automobile Market in the World ...
.. and now the number one market for General Motors.
Source: report from CNBC this morning, February 2, 2011.
Something tells me China is going to need a bit more oil going forward.
And something tells me wind power and solar power are not anywhere near the top of China's national energy agenda. Just saying.
Source: report from CNBC this morning, February 2, 2011.
Something tells me China is going to need a bit more oil going forward.
And something tells me wind power and solar power are not anywhere near the top of China's national energy agenda. Just saying.
Wow! This Is Counter-Intuitive -- Turkey Season Should Be Great -- North Dakota, USA
Considering how harsh the North Dakota winter has been, and all the stories on livestock and wild game being being hit hard, it comes as quite a surprise, at least to me, that the spring turkey hunting season should be a good season.
Apparently wild turkeys have a knack for finding food and shelter during even the harshest winters.
Apparently wild turkeys have a knack for finding food and shelter during even the harshest winters.
Stan Kohn, upland game biologist for the North Dakota Game and Fish Department, said unlike some species of upland game birds, turkeys have a knack for finding food and cover during harsh winters.Who would have thought?
"Turkeys are not native to this area, but they have adjusted to what is available," Kohn said. "Very seldom do we winter mortality on turkeys."
The Heart of the Bakken Continues to Grow -- Hotel, Restaurant, Man Camp -- Williston, North Dakota
New hotel and restaurant set to open.
(Note: regional links break often and break early.)
As Williston continues to grow, two new businesses have set up shop in town. Big Willy's Saloon and Grill and the HomStay Suites hotel have opened in the north west section of town, near Sloulin Field International Airport.Another man camp was approved.
The proposed housing would be for approximately 100 people and would be used by RNI Trucking out of Vernal, Utah.
Evans said the housing would be 12 miles west of Williston, on a 10-acre parcel of land in Judson Township. It would be located on the south side of U.S Highway 2.
(Note: regional links break often and break early.)
CNBC: John Hofmeister, Former CEO of Shell --> $5 Gasoline
John Hofmeister is a regular on CNBC and his comments are always right on target. He is saying everything that has been said on this blog, such as:
And, another "by-the-way," I see that oil futures (WTI) is up another $2.80, just pennies shy of $101.
And one of the "talking heads" hit the nail on the head. See connecting the dots.
- The administration is so anti-oil that leads to the predicament that we are in.
- Gulf of Mexico was closed for much of last year, and will be closed to drilling most of this year.
- If administration was serious about a) jobs; and, b) energy independence, the government would set a mandate for US to produce 10 million bbls of oil per day. Right now the US is down to 7 million barrels and heading to 6 million barrels.
The "glut" at Cushing is 37 million barrels which represents two days of consumption for the US. The reason for this glut is twofold: a) European oil is being sent to the East Coast because demand for oil in Europe has been decreasing (this, of course, will change with events in Libya); and, b) lower refinery demand in the south during the winter months.By the way, once the US reaches 6 million bbls of oil production per day and North Dakota produces 1 million bopd, ND will account for almost 20 percent of American-produced oil (17%). Kind of exciting.
And, another "by-the-way," I see that oil futures (WTI) is up another $2.80, just pennies shy of $101.
And one of the "talking heads" hit the nail on the head. See connecting the dots.
Finally: A Break in the Natural Gas Paradigm
Two things are needed if natural gas as a vehicle fuel is going to succeed: a) large companies need to convert their fleets; and, b) a natural gas refueling corridor has to be established.
UPS is about to do that. All the way from Los Angeles to Las Vegas to Salt Lake City.
If they have the cash, this could be accomplished in less than a year. All they have to do is put in a natural gas pump at designated service stations already along the route.
But this is what I find most interesting: it was a publicly traded corporation that did this, not the government.
Instead, the administration is still pushing "pie in the sky" high speed rail which will never happen in this country.
Wouldn't it have been an eye-opener had the administration directed that Department of Transportation begin a similar nationwide natural gas refueling initiative along the entire US interstate system? A visionary would have called the nationwide trucking and logistic companies, such as Wal-Mart, into the Oval Office and discussed a grand partnering scheme. But such out-of-the-box thinking cannot occur when one partner is so anti-business. Nor can it be done when one partner is so anti-big oil.
Good for UPS. This should work. Before it's all over, UPS might just get into the energy business. It wouldn't be the first time a corporation has transformed itself.
If UPS follows through on this, this is huge.
UPS is about to do that. All the way from Los Angeles to Las Vegas to Salt Lake City.
If they have the cash, this could be accomplished in less than a year. All they have to do is put in a natural gas pump at designated service stations already along the route.
But this is what I find most interesting: it was a publicly traded corporation that did this, not the government.
Instead, the administration is still pushing "pie in the sky" high speed rail which will never happen in this country.
Wouldn't it have been an eye-opener had the administration directed that Department of Transportation begin a similar nationwide natural gas refueling initiative along the entire US interstate system? A visionary would have called the nationwide trucking and logistic companies, such as Wal-Mart, into the Oval Office and discussed a grand partnering scheme. But such out-of-the-box thinking cannot occur when one partner is so anti-business. Nor can it be done when one partner is so anti-big oil.
Good for UPS. This should work. Before it's all over, UPS might just get into the energy business. It wouldn't be the first time a corporation has transformed itself.
If UPS follows through on this, this is huge.
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