There are 159 million blogs.
One of the best: Carpe Diem.
The Carpe Diem site has nothing to do with oil except for an occasional post.
When you get there, scroll down quickly and note the graphs. You can move through the blog quite quickly.
For other external sites linked to this one, scroll to the bottom of the sidebar at the right. For another non-oil blog, Tom McMahon is one I also particularly enjoy.
Tuesday, April 12, 2011
Majors Are Preparing Investors/Others for Significantly Higher Profits in 1Q11
Link here.
In January, Chevron said its fourth-quarter earnings jumped 72%.
Chevron will report first-quarter earnings on April 29.
Chevron said it expects first-quarter earnings to rise from the prior quarter, helped by higher oil prices and slightly offset by lower profits from its refining and marketing arm.Production will actually be shown to have decreased due to peculiarity of contracts.
The outlook signals that major oil companies will report a surge in quarterly earnings for the period ended March 31, boosted by climbing oil prices, which appreciated in average almost $20 a barrel compared with the same quarter a year ago.
In January, Chevron said its fourth-quarter earnings jumped 72%.
Chevron will report first-quarter earnings on April 29.
American Standard Announces Another Acquisition in the Bakken, North Dakota, USA
Ticker: ASEN.OB
Link here for most recent acquisition, announced April 12, 2011:
Eastern Mountrail county has not been very productive to date; without knowing where their acreage is, one cannot comment on the price paid (<$1,000/acre) for their most recent acquisitions.
Link here for most recent acquisition, announced April 12, 2011:
- Acquired 2,780 acres, Mountrail County
- Average paid: $669/acre
- Total transaction price: $1.9 million (rounded)
- Total Bakken acreage after this transaction closes: 18,900 acres
- Acquired 10,148 acres, located within 8 counties of North Dakota
- Seller: Geronimo Holding Corporation
- Average price paid: $725/acre
- Single largest Bakken acquisition to date for American Standard
- Following that acquisition: 16,000 acres
- In this transaction, acquired 367 acres plus 26 additional gross wells
Eastern Mountrail county has not been very productive to date; without knowing where their acreage is, one cannot comment on the price paid (<$1,000/acre) for their most recent acquisitions.
A Reminder: All This Week the IPAA Oil and Gas Investment Symposium
The link is here.
To access the presentations, one must go to the specific corporate website.
A big thank you to a colleague who has been sending me the links to the presentations. As I get the links, I post them here. Over the next few weeks, I hope to point out a couple things from each presentation that jump out at me when I run through the slides.
What jumps out at me right now when I review the slides:
On another note, for those of you concerned about the drop in the price of oil (with expectations that it will continue to drop), this winter many wells were "shut in" in North Dakota due to the weather. Oil was not being produced/transported/sold from almost 700 wells in January for some period of time. No matter how high oil was priced, if it isn't being produced, it isn't going to matter.
Now, with oil still above $100, and North Dakota oil being moved once again, royalty checks for mineral owners, including the state of North Dakota, should improve. (I am not a mineral owner.) By the way, at least one presenter at the IPAA has earmarked CAPEX for pipelines to ensure that oil is moved even during the worst winter months in North Dakota.
To access the presentations, one must go to the specific corporate website.
A big thank you to a colleague who has been sending me the links to the presentations. As I get the links, I post them here. Over the next few weeks, I hope to point out a couple things from each presentation that jump out at me when I run through the slides.
What jumps out at me right now when I review the slides:
- a) the multiple pay zones in the Williston Basin; and,
- b) the huge amount of CAPEX money that is going into a few counties in western North Dakota.
On another note, for those of you concerned about the drop in the price of oil (with expectations that it will continue to drop), this winter many wells were "shut in" in North Dakota due to the weather. Oil was not being produced/transported/sold from almost 700 wells in January for some period of time. No matter how high oil was priced, if it isn't being produced, it isn't going to matter.
Now, with oil still above $100, and North Dakota oil being moved once again, royalty checks for mineral owners, including the state of North Dakota, should improve. (I am not a mineral owner.) By the way, at least one presenter at the IPAA has earmarked CAPEX for pipelines to ensure that oil is moved even during the worst winter months in North Dakota.
Coal "Clearner" Than Natural Gas? -- Almost Too Good To Be True
I have not checked the links that this article references, stating that natural gas, as it is currently being produced from the Marcellus, actually leaves a larger "carbon footprint" than coal.
Long-term readers of this blog know my feelings about "carbon footprints" and man's role in global warming, so I'm not going to take the time to do anything more than comment on the linked article.
The author says that if this is "true," that natural gas production through hydraulic fracking is leaving a larger "carbon footprint" than coal, then coal is the "real winner."
If the public can be convinced that natural gas is not as clean as we all think, the reasoning goes, then "coal" is the real winner.
My thought: for the foreseeable future, both coal and natural gas will do well. Something tells me scientific studies comparing "carbon footprints" between coal and natural gas will not change anyone's mind regarding either, or change minds about fossil fuels in general. As JRR Tolkien said, we all have our myths.
Long-term readers of this blog know my feelings about "carbon footprints" and man's role in global warming, so I'm not going to take the time to do anything more than comment on the linked article.
The author says that if this is "true," that natural gas production through hydraulic fracking is leaving a larger "carbon footprint" than coal, then coal is the "real winner."
If the public can be convinced that natural gas is not as clean as we all think, the reasoning goes, then "coal" is the real winner.
My thought: for the foreseeable future, both coal and natural gas will do well. Something tells me scientific studies comparing "carbon footprints" between coal and natural gas will not change anyone's mind regarding either, or change minds about fossil fuels in general. As JRR Tolkien said, we all have our myths.
Only One (1) New Permit Today -- North Dakota USA
Operator: SM Energy
Field: Wildcat in McKenzie County; one section to the west of North Tobacco Garden which is fairly active right now.
The rest of the daily activity report was very unremarkable.
Field: Wildcat in McKenzie County; one section to the west of North Tobacco Garden which is fairly active right now.
The rest of the daily activity report was very unremarkable.
IPs Continue to Confuse -- Bakken, North Dakota, USA
I could pick any company and any Bakken well, but since I happen to be looking at the current corporate MDU presentation and having just linked the NDIC file reports, I will show newbies how IPs continue to confuse. [See first comment for explanation why the IP provided to the NDIC may be different than that presented to the public.]
In the MDU presentation, April, 2011, slide 20 of 53:
Several operators now agree that higher IPs correlate with faster payback on the well, and the total ultimate recovery. The easiest question for an analyst to ask when a corporate presentation is being provided is: "That's an impressive IP on the PowerPoint slide, but what was the "official" IP as reported to the NDIC?"
In addition, every time an IP is presented on a corporate slide, the type of frac, the number of stages, and the ingredients used to frac should be included. I would take it one step further. I would ask what did the operator learn about that particular frac that will help with the next well?
In the MDU presentation, April, 2011, slide 20 of 53:
- First discovery well in Three Forks formation, Stark County, Kostelecky 31-6H, 24-hour IP rate of
- 1,257 bbls of oil, and
- 519 Mcf of gas, or
- 1,343 BOE
- IP Oil: 595
- IP MCF: 196
Several operators now agree that higher IPs correlate with faster payback on the well, and the total ultimate recovery. The easiest question for an analyst to ask when a corporate presentation is being provided is: "That's an impressive IP on the PowerPoint slide, but what was the "official" IP as reported to the NDIC?"
In addition, every time an IP is presented on a corporate slide, the type of frac, the number of stages, and the ingredients used to frac should be included. I would take it one step further. I would ask what did the operator learn about that particular frac that will help with the next well?
Eagle Ford South of San Antonio, Texas -- Another Bakken Story
I grew up in Williston, the center of the Bakken oil boom.
I now live in San Antonio, just on the northern edge of another "Bakken boom," the Eagle Ford.
And that's why I enjoy posting; I can relate to these areas.
Link here on the Eagle Ford boom.
No data points because it sounds just like the North Dakota Bakken.
In another story, Koch Pipeline Company, LP. will lay another pipeline from the Eagle Ford (Pettus, Texas) to Corpus Christi. Something tells me the refineries around Corpus are gonna be hopping.
I now live in San Antonio, just on the northern edge of another "Bakken boom," the Eagle Ford.
And that's why I enjoy posting; I can relate to these areas.
Link here on the Eagle Ford boom.
No data points because it sounds just like the North Dakota Bakken.
In another story, Koch Pipeline Company, LP. will lay another pipeline from the Eagle Ford (Pettus, Texas) to Corpus Christi. Something tells me the refineries around Corpus are gonna be hopping.
Natural Gas Story Keeps Getting Bigger -- Not a Bakken Story
Link here.
Data points.
Data points.
- There are more formations than just the Marcellus in Pennsylvania that have natural gas reserves
- "This is Marcellus times two"
- Potentially a "natural gas triple play"
- Range Resources Corp (Texas-based) drilled first Marcellus well in 2004
- At least four drillers, including Range Resources, will explore additional formations below the Marcellus
- Natural gas reserves in the US highest in 40 years
- By 2035: shale gas will account for 46% of US natural gas production
- So far, 2,748 wells have been drilled into the Marcellus (399 in first three months of 2011)
- Expectation: 5,000 into the Marcellus "in the coming decades"
- The Utica formation: 200-feet thick; 8,450 feet below the surface (about the depth of a ND Bakken)
- Utica formation below the Marcellus might not require fracking
- Others say the Utica in Ohio is better; not as deep
Incredible Video of Flooding Along the Eastern Part of North Dakota
This has nothing to do with the oil industry, but it is incredible video footage of the flooding along (and over) I-29 along the Red River in eastern North Dakota. I assume the link will break soon but if it does, you should be able to find the footage at YouTube. Search: I-29, flooding, 2011, Harwood, North Dakota.
Albert Charles Zastoupil, Jr -- Obituary in the Dickinson Press
This is a first for this blog, but it helps me connect some dots, or in this case, perhaps, attach a family name to a well.
I see in the Dickinson Press that Albert Charles Zastoupil, Jr. has passed away. The name caught my eye. That's also the name given to a well in the Dickinson area that is of interest, but that is not important now.
The story again demonstrates what one can do if one is willing to work hard and stay with your employer. Mr Zastoupil, Jr, was born in Dickinson, ND, and started working with the Coca-Cola company in 1971, about the age of 26, if I have my dates correct. He worked his way up through the company, eventually opening the first Coca-Cola plant in Russia (Moscow) and then the second plant in Russia (St Petersburg). He also opened a plant in the Caribbean. Very, very impressive.
He died relatively young, another victim of Alzheimer's. My heart goes out to the family, and especially his wife who was his primary caretaker in his last years.
I see in the Dickinson Press that Albert Charles Zastoupil, Jr. has passed away. The name caught my eye. That's also the name given to a well in the Dickinson area that is of interest, but that is not important now.
The story again demonstrates what one can do if one is willing to work hard and stay with your employer. Mr Zastoupil, Jr, was born in Dickinson, ND, and started working with the Coca-Cola company in 1971, about the age of 26, if I have my dates correct. He worked his way up through the company, eventually opening the first Coca-Cola plant in Russia (Moscow) and then the second plant in Russia (St Petersburg). He also opened a plant in the Caribbean. Very, very impressive.
He died relatively young, another victim of Alzheimer's. My heart goes out to the family, and especially his wife who was his primary caretaker in his last years.
Menard's Coming to Williston -- A Huge Story
The announcement that Menard's is coming to Williston is a huge story. Links here and here.
It is due to open in 2012, but the big question on everyone's mind is where will they get the employees; they plan to hire 130 workers. Actually, I think Menard's has less to worry about than the other retailers in Williston with regard to employees. Something tells me Menard's will offer a very competitive hourly pay/salary with benefits program.
I can think of a number of solutions with regard to the employee problem in Williston but I've learned that my comments and 75 cents will buy you a cup of coffee, so I will spare you my thoughts on that subject. I'm sure Menard's is going to work that issue very hard.
Menard's will be a 200,000 square foot facility. It will be adjacent to a new retail location which could end up being as big as 200 acres. Phase One of this retail operation will be 100 acres, and adjacent to Menard's.
It will be located west of Williston, on the north side of the bypass. I think I know who owned that land when I was growing up in Williston. I always thought that area would eventually be developed. In a way, it's too bad. I used to explore that area when I was a teenager.
Coming west from Montana towards Williston, when it is completed, you will see Menard's on your left, just before you make a decision to drift right into Williston toward the south end of town, along the Burlington Northern tracks, or continue to your left on the bypass around Williston. I remember all the controversy when the bypass was put in. Folks were worried that tourists/travelers would truly bypass Williston. That would be hard to imagine when Williston was the only stop for more than a hundred miles in any direction.
The biggest takeaway with regard to Menard's coming to Williston: this should suggest to most folks that there are some who think the oil industry is here to stay this time for quite awhile.
It is due to open in 2012, but the big question on everyone's mind is where will they get the employees; they plan to hire 130 workers. Actually, I think Menard's has less to worry about than the other retailers in Williston with regard to employees. Something tells me Menard's will offer a very competitive hourly pay/salary with benefits program.
I can think of a number of solutions with regard to the employee problem in Williston but I've learned that my comments and 75 cents will buy you a cup of coffee, so I will spare you my thoughts on that subject. I'm sure Menard's is going to work that issue very hard.
Menard's will be a 200,000 square foot facility. It will be adjacent to a new retail location which could end up being as big as 200 acres. Phase One of this retail operation will be 100 acres, and adjacent to Menard's.
It will be located west of Williston, on the north side of the bypass. I think I know who owned that land when I was growing up in Williston. I always thought that area would eventually be developed. In a way, it's too bad. I used to explore that area when I was a teenager.
Coming west from Montana towards Williston, when it is completed, you will see Menard's on your left, just before you make a decision to drift right into Williston toward the south end of town, along the Burlington Northern tracks, or continue to your left on the bypass around Williston. I remember all the controversy when the bypass was put in. Folks were worried that tourists/travelers would truly bypass Williston. That would be hard to imagine when Williston was the only stop for more than a hundred miles in any direction.
The biggest takeaway with regard to Menard's coming to Williston: this should suggest to most folks that there are some who think the oil industry is here to stay this time for quite awhile.
GMX Resources Announces Record Earnings: Just the Beginning
GMX Resources announces record earnings for 1Q11. This is going to be a huge quarter for energy industry.
GMX Resources made news recently when it entered the Bakken, but it has a very small footprint and one wonders exactly what it plans in the Bakken.
From the press release:
Some of the Bakken-only energy companies may miss production targets in 1Q11 due to the weather. Almost 700 wells were shut in for much of January. The high price of oil in March may make up for the losses in January, resulting in a wash for the Bakken-only energy companies.
Earnings of all Bakken-related companies are aggregated at "Earnings Central."
GMX Resources made news recently when it entered the Bakken, but it has a very small footprint and one wonders exactly what it plans in the Bakken.
From the press release:
The Company has achieved total production of 6.0 Bcfe for the first quarter 2011 which is a Company record and an achievement of the previously announced guidance. The 6.0 Bcfe of production in the first quarter represents a 14% increase over the fourth quarter of 2010 and a 89% increase over the first quarter of 2010.GMX Resources is predominantly a natural gas exploration and production company but has recently changed its profile to highlight its involvement in two oily shale plays: the North Dakota Bakkken and the Niobrara in D-J.
The Company's second quarter and full year 2011 guidance is 6.1 Bcfe with an expected range of 25.0-26.0 Bcfe, respectively, which represents an increase of 42% and 43%-49% in the second quarter and full year 2010.
Some of the Bakken-only energy companies may miss production targets in 1Q11 due to the weather. Almost 700 wells were shut in for much of January. The high price of oil in March may make up for the losses in January, resulting in a wash for the Bakken-only energy companies.
Earnings of all Bakken-related companies are aggregated at "Earnings Central."
Japanese Nuclear Disaster Now Raised to Highest Alert Level: 7/7
For all updates, click here.
Remember, our Secretary of Energy, Stephen Chu, a nuclear physicist, said his worst nightmare was coal.
It's interesting to read the "spin" regarding nuclear energy. In this article, the expert says that the reaction to the disaster in Japan "may mark a high point in anti-nuclear hysteria." He goes on to say that “the average coal plant releases 100 times more annual radiation than a comparable nuclear plant.”
Unless, of course, the nuclear plant releases all that radiation at once, as in a nuclear meltdown.
Remember, our Secretary of Energy, Stephen Chu, a nuclear physicist, said his worst nightmare was coal.
It's interesting to read the "spin" regarding nuclear energy. In this article, the expert says that the reaction to the disaster in Japan "may mark a high point in anti-nuclear hysteria." He goes on to say that “the average coal plant releases 100 times more annual radiation than a comparable nuclear plant.”
Unless, of course, the nuclear plant releases all that radiation at once, as in a nuclear meltdown.
Downs goes on to cite the rarity of these kinds of events in the 60-year history of the commercial nuclear energy, especially ones that cause civilian casualties.
“Although there may very well be deaths associated with the Japanese meltdown in the months and years to come, the only reactor incident to cause civilian deaths to date was Chernobyl, a poorly run facility in the bankrupt late-Soviet Union (amazingly built with no containment vessel),” said Downs.
"The rarity of these kinds of events..." well, that's reassuring. Of course, if nuclear plant disasters weren't rare, the disaster in Japan would not be a front page story either.
Unit Corporation: To Add Rigs in North Dakota -- Bakken, North Dakota, USA
I am not sure if I understand Unit Corporation's corporate presentation and other information at its website but it sounds like the company plans to bring in 2 or 3 of its rigs to operate its holdings (12,750 net acres) in the Bakken.
Unit Corporation is the fifth largest deep onshore driller. It is a contract driller, as well as having its own production, if I understand the presentation correctly. Its market cap is $3 billion.
Unit Corporation is the fifth largest deep onshore driller. It is a contract driller, as well as having its own production, if I understand the presentation correctly. Its market cap is $3 billion.
A Disappointing EOG Well in the Parshall Oil Field -- Bakken, North Dakota, USA
In today's daily activity report, EOG reported a very disappointing well (based on IP):
Compare to:
- 19391, 42, EOG, Austin 117-08H, Parshall oil field, 8-154-90, Three Forks; t12/10; cum 20K 6/12;
Compare to:
- 17346, 1,835, EOG, Austin 13-08H, Parshall oil field, 8-154-90, upper Bakken, tested 10/08; cumulative 380K, still producing at 6,000 bbls/day; I was unable to determine number of frac stages; report mentions only sand and water used in the frac; t10/08; cum 467K 6/12;
- 19392, PNC, EOG, Austin 103-08H, Parshall oil field
Seven (7) New Permits -- Bakken, North Dakota, USA
Operators: EOG (4), Zenergy (2), and BTA.
Fields: Thompson Lake, Stockyard Creek, Banks, and Siverston.
The four EOG wells will be on one pad, two horizontals going north, two going south -- may look a lot like an Eco-Pad.
For such a small field, Stockyard Creek oil field certainly gets a lot of attention; this time its BTA.
Ten wells came off the confidential list, to be reported elsewhere (one was a salt water disposal well). One of the wells coming off the confidential list was Fidelity's Kostelecky well in Stark County. This is where Whiting is very, very active in the Three Forks formation. The Kostelecky was a very respectful well, especially considering it's a Fidelity; it had an IP of 595.
On the other hand, a Three Forks well in its very prolific Parshall oil field, EOG's Austin 117-08H, was very disappointing (based on its IP); it had an IP of 42. This well was drilled just feet away from another well in that same section, a middle Bakken formation well that had an IP of over 1,800.
The following permits were canceled:
Fields: Thompson Lake, Stockyard Creek, Banks, and Siverston.
The four EOG wells will be on one pad, two horizontals going north, two going south -- may look a lot like an Eco-Pad.
For such a small field, Stockyard Creek oil field certainly gets a lot of attention; this time its BTA.
Ten wells came off the confidential list, to be reported elsewhere (one was a salt water disposal well). One of the wells coming off the confidential list was Fidelity's Kostelecky well in Stark County. This is where Whiting is very, very active in the Three Forks formation. The Kostelecky was a very respectful well, especially considering it's a Fidelity; it had an IP of 595.
On the other hand, a Three Forks well in its very prolific Parshall oil field, EOG's Austin 117-08H, was very disappointing (based on its IP); it had an IP of 42. This well was drilled just feet away from another well in that same section, a middle Bakken formation well that had an IP of over 1,800.
The following permits were canceled:
- 16892, Helis, Jones 16-15H
- 17546, Slawson, Probe 1-19-30H
- 17548, Slawon, Menace 1-17H
- 17588, Slawson, Scout 1-18H
- 17860, Lario, Johnson 1-26H
- 19998, Tracker, Regeth 22-1H
- 20385, Samson, Pelican 26-35-162-96H
Frac Spreads in the Williston Basin -- Bakken, North Dakota, USA
Back on November 16, 2010, I had a post on the companies fracking in the Williston Basin.
Someone sent in a comment asking how many frac spreads Schlumberger and Sanjel have in the Williston Basin. In company presentations, I have seen the phrase "frack teams" used, and I assume this is the same thing.
For example, some operators say they have two or three dedicated frac teams, this question is: how many frac teams or frac spreads does Schlumberger, Halliburton, and Sanjel have in the Williston Basin, and are their plans to increase that number?
Someone sent in a comment asking how many frac spreads Schlumberger and Sanjel have in the Williston Basin. In company presentations, I have seen the phrase "frack teams" used, and I assume this is the same thing.
For example, some operators say they have two or three dedicated frac teams, this question is: how many frac teams or frac spreads does Schlumberger, Halliburton, and Sanjel have in the Williston Basin, and are their plans to increase that number?
Subscribe to:
Posts (Atom)