Samson O&G advised that operations on the Earl #1-13H to drill out the 19 frac plugs is underway. This operation, which commenced last week, has been hampered by difficult weather conditions, by the stand down of the rig crew for Easter and by equipment breakdowns. The operation is now back on track, however and the first of the nineteen plugs had been drilled as of 0700 hours CST this morning.
Prior to the first plug being drilled, the oil rate from the well for the previous 24 hours was 292 BOPD. After the first plug was drilled, the rate was measured at 960 BOPD over a two hour period, prior to commencing the drill out of the second plug. Neither of these rates is considered to be a conclusive indicator of the well's initial production performance, as this can only be determined once all of the plugs have been removed. Samson is, however, encouraged by the marked increase in the oil rate from just one of the nineteen plugs being removed.
Thursday, April 28, 2011
Samson Updates On Earl -- Bakken, North Dakota, USA
Link here.
Huge Well -- Hecker 21-18TFH -- Whiting South -- Bakken, North Dakota, USA
From Whiting's 1Q11 earnings announcement:
I've been waiting for information on the Hecker 21-18TFH.
The Hecker is right in the middle of the flurry of Whiting activity north of Belfield in the Bell and Zenith oil fields I have been posting about for the last several days. For more, click here and here.
The Hecker 21-18TFH is still on the confidential list, so this is the first information that has been released about this well, as far as I know.
A huge "thank you" to Don for alerting me to it.
The Hecker 21-18TFH, during a 24-hour test of the Three Forks formation at a vertical depth of approximately 10,500 feet on March 4, 2011, flowed at a daily rate of 3,106 barrels of oil and 3,038 Mcf of gas, or 3,612 BOE per day.This is huge.
This is the highest initial production rate for a Three Forks well in the Williston Basin, according to Harts Unconventional Oil & Gas website.
The initial 24-hour production rate was gauged on a 48/64-inch choke with a flowing casing pressure of 990 pounds per square inch (psi). The well was fracture stimulated in a total of 22 stages, all using sliding sleeve technology. An additional eight stages are scheduled to be fraced with the “plug and perf” method.
Whiting, the operator of the well, holds a 77% working interest and a 62% net revenue interest in the new producer.
I've been waiting for information on the Hecker 21-18TFH.
The Hecker is right in the middle of the flurry of Whiting activity north of Belfield in the Bell and Zenith oil fields I have been posting about for the last several days. For more, click here and here.
The Hecker 21-18TFH is still on the confidential list, so this is the first information that has been released about this well, as far as I know.
A huge "thank you" to Don for alerting me to it.
Eight (8) New Permits -- Bakken, North Dakota, USA -- Update on Three Corinthian/Surge/Spearfish Wells
Drillers: CLR (2), Whiting (2), Petro-Hunt, Samson Resources, Ursa, Newfield.
Fields: Dollar Joe, Baukol Noonan, Bell, Zenith, Cabernet, Fertile Valley, and a wildcat.
Whiting has two more exciting permits: one in Bell, and one in Zenith, two neighboring fields which are very, very exciting. See yesterday's posting on Whiting's new permits in Zenith and North Creek.
CLR has the permit in Cabernet, another exciting field.
Finally, Ursa's wildcat is in McKenzie County, southwest of Watford City.
Hess reported a nice well in today's daily activity report:
Fields: Dollar Joe, Baukol Noonan, Bell, Zenith, Cabernet, Fertile Valley, and a wildcat.
Whiting has two more exciting permits: one in Bell, and one in Zenith, two neighboring fields which are very, very exciting. See yesterday's posting on Whiting's new permits in Zenith and North Creek.
CLR has the permit in Cabernet, another exciting field.
Finally, Ursa's wildcat is in McKenzie County, southwest of Watford City.
Hess reported a nice well in today's daily activity report:
- 19146, 988, Hess, Little Chase Creek 21-1H, Little Knife, Bakken, 18K in first month
- 19386, 0 bopd, Ritchie Exploration, Bernstein 1, Bottineau County; was also released from confidential status today but no data provided the date of the original post. However, on the daily activity report of April 28, 2011, "0 bopd" was reported and is now reported as "Shut In"
US Government: Lease Sales Off Mid-Atlantic, South-Atlantic Won't Occur Before 2017
From the 2011 Energy Information Agency (EIA-US) update, 2009 - 2035:
Rising world oil prices, growing shale oil resources, and increased production using enhanced oil recovery techniques contribute to increased US oil production to 2035 in the AEO2011 reference case. From 2009 to 2035, US crude oil production is forecast to increase by about 600,000 b/d. [Blog comment: Bakken could account for much of this.]
Bakken shale oil contributes to oil production growth in the Rocky Mountain region, and growth in the Gulf Coast region is spurred by resources in the Eagle Ford and Austin Chalk formations, while some of the decline in oil production in the southwestern US is offset by production from the Avalon shale formation, according to the outlook.
Lower 48 offshore production increases by 13% between 2009 and 2035 in the reference case. According to the recent Bureau of Ocean Energy Management, Regulation, and Enforcement leasing plan, lease sales in the Mid-Atlantic and South-Atlantic Outer Continental Shelf will not occur before 2017. Oil shale liquid production, which comes on line in the Rocky Mountain region in 2029 in the reference case, accounts for about 2% of total US oil production in 2035.
Linn Energy Misses by 3 Cents; Acquires More Bakken Acreage -- North Dakota, USA
Link here.
Misses by 3 cents.
In same press releases, announces continued aggressive acquisition spree in the Bakken:
Misses by 3 cents.
In same press releases, announces continued aggressive acquisition spree in the Bakken:
Independent explorer and producer Linn Energy said it agreed to purchase assets in North Dakota's Bakken shale for $163 million, continuing a buying spree of oil- and natural gas-liquids rich properties, but its quarterly profit fell below estimates.From Houston Business Journal.com
- $163 million: an additional two sets of assets in the Bakken shale play in North Dakota
- Bringing its total acquisitions in the play this year to $238 million
Noble Energy Beats by 21 Cents
Link here.
One year ago, 1Q10, net income: $237 million
Difference due to "unrealized commodity derivative losses" and a rig standby charge in the deepwater Gulf of Mexico.
Noble Energy reported today first quarter 2011 net income of $14 million, or $0.08 per share diluted, on revenues of $899 million. The Company's first quarter 2010 net income was $237 million, or $1.34 per share diluted, on revenues of $733 million. First quarter 2011 net income includes items that are not typically considered by analysts in published estimates. Excluding the impact of these items, which were primarily unrealized commodity derivative losses and a rig standby charge in the deepwater Gulf of Mexico, first quarter 2011 adjusted net income(1) was $240 million, or $1.35 per share diluted. Adjusted net income(1) for the first quarter of 2010 was $138 million, or $0.78 per share diluted.This quarter, net income: $14 million
One year ago, 1Q10, net income: $237 million
Difference due to "unrealized commodity derivative losses" and a rig standby charge in the deepwater Gulf of Mexico.
Fracking Backlog / Delays in the Bakken, North Dakota, USA
Generally speaking one can assume that a Bakken horizontal can reach total depth (TD) in less than 30 days. Within a couple of days of reaching TD, the company should be able to frack the well, and once that is complete, bring the equipment to the pad to determine the 24-hour flowback or start calculating the IP.
As a rule of thumb, in my mind, any delta greater than 60 days between spud date and test date in a Bakken horizontal represents a delay due to fracking backlog. There might be one exception: on Eco-Pads, or Smart Pads, where there are four or more wells per pad, drillers may wait to report the IP or the 24-hour flowback until all wells are completed and tested. In that case, the first well could be spud up to three or four months before the last well reached TD. Of course there are other mitigating factors: a) company policy; and, b) weather. With regard to the first, some companies don't frack during the winter, and. of course, we all know how the horrendous weather this past winter affected Bakken operations. It should also be noted that an occasional well is not fracked; and, for various reasons, a company may purposely delay fracking.
One can also assume that the "smaller" (in terms of number of rigs) drillers will have a greater delay on average in getting their wells fracked than the larger drillers. The larger drillers now have dedicated frack crews.
Today, first example:
As a rule of thumb, in my mind, any delta greater than 60 days between spud date and test date in a Bakken horizontal represents a delay due to fracking backlog. There might be one exception: on Eco-Pads, or Smart Pads, where there are four or more wells per pad, drillers may wait to report the IP or the 24-hour flowback until all wells are completed and tested. In that case, the first well could be spud up to three or four months before the last well reached TD. Of course there are other mitigating factors: a) company policy; and, b) weather. With regard to the first, some companies don't frack during the winter, and. of course, we all know how the horrendous weather this past winter affected Bakken operations. It should also be noted that an occasional well is not fracked; and, for various reasons, a company may purposely delay fracking.
One can also assume that the "smaller" (in terms of number of rigs) drillers will have a greater delay on average in getting their wells fracked than the larger drillers. The larger drillers now have dedicated frack crews.
Today, first example:
- 19146, 988, Hess, Little Chase Creek 21-1H, Little Knife, Bakken; spudded 10/28/10; tested 2/8/10 -- a delta of 3.5 months. It should be noted that January/February, 2011, was notable for horrendous weather in North Dakota, and it's amazing that anything got done. I wouldn't read much into this delta.
The Price of Oil (WTI, NYMEX) Is Up Another $1.00
11:29 a.m. EST, April 28, 2011: up $1.05 to $113.81.
"No quick fixes."
"No quick fixes."
Double-Dip Recession?
The pundits all say the momentum of the US economy is such that the possibility of a double-dip recession is out of the question. In fact, even the talk of a DDR has pretty much disappeared from mainstream media.
At some point enough time will have elapsed from the most recent recession to the next recession that it won't qualify as a DDR, simply the business cycle.
I wonder if the unemployed and Wal-Mart shoppers agree. Perhaps technically it won't be a recession but it certainly might feel like a recession that never ended (and as Ronald Reagan would say, a depression for some). The two articles that caught my interest today:
Meanwhile, the Fed admits inflation is coming, and the numbers out today confirm it. Core inflation this month is 1.5% compared to 0.4% last month. Gold just a hit a new record (April 28, 2011) and silver is flirting with an all-time record, nearing $50.
At some point enough time will have elapsed from the most recent recession to the next recession that it won't qualify as a DDR, simply the business cycle.
I wonder if the unemployed and Wal-Mart shoppers agree. Perhaps technically it won't be a recession but it certainly might feel like a recession that never ended (and as Ronald Reagan would say, a depression for some). The two articles that caught my interest today:
- The increase in first-time jobless claims surprise analysts
- Wal-Mart is noticing that its customers are "running out of money more quickly"
Meanwhile, the Fed admits inflation is coming, and the numbers out today confirm it. Core inflation this month is 1.5% compared to 0.4% last month. Gold just a hit a new record (April 28, 2011) and silver is flirting with an all-time record, nearing $50.
Another Rare Buying Opportunity: Another Energy-Related Company Down In Trading Today: HP -- Helmerich and Payne -- FlexRigs
From Yahoo!InPlay, Helmerich and Payne misses forecasts, beats on revenues:
Helmerich & Payne misses by $0.04, beats on revs (HP) 69.98 : Reports Q2 (Mar) earnings of $0.93 per share, excluding non-recurring items, $0.04 worse than the Thomson Reuters consensus of $0.97; revenues rose 38.3% year/year to $604 mln vs the $592.4 mln consensus. Co also announced today that it signed contracts to build and operate eight additional FlexRigs, bringing to 14 the number of additional FlexRig commitments announced since the Company's January 27, 2011, earnings release. These rigs will be built and operated in the U.S. under multi-year term contracts that provide attractive dayrates and economic returns. Since March 2010, the co has announced contracts for the construction of 45 new build FlexRigs, of which 26 have been completed. The remaining 19 rigs are expected to be delivered during calendar 2011.
Actions Have Consequences -- Absolutely Nothing To Do With the Bakken
From South Carolina:
From Los Angeles:
From Pennsylvania:
Federal regulators stomp on Amish selling raw milk.
Something tells me the Amish don't vote, and the consumers of raw milk did not vote for Ronald Reagan, who hated government interference with the free market.
Amazon all but told South Carolina goodbye Wednesday after the online retailer lost a legislative showdown on a sales tax collection exemption it wants to open a distribution center that would bring 1,249 jobs to the Midlands.
Company officials immediately halted plans to equip and staff the one million-square-foot building under construction.Amazon immediately canceled $52 million in procurement contracts after South Carolina legislature voted to reject a tax break for Amazon in exchange for locating in South Carolina.
From Los Angeles:
Los Angeles Mayor Antonio Villaraigosa on Wednesday ordered his managers to impose 42 furlough days on city employees in four union groups after those workers rejected his proposal for cutting the budget shortfall. [8.5 weeks or 2 months or 17 percent of the work year]From Massachusetts:
Employee groups representing more than 6,300 full-time workers voted against the labor agreement that the mayor negotiated last month with leaders of the Coalition of L.A. City Unions. Balloting finished Tuesday.
House lawmakers voted overwhelmingly last night [April 26, 2011] to strip police officers, teachers, and other municipal employees of most of their rights to bargain over health care, saying the change would save millions of dollars for financially strapped cities and towns.
From Pennsylvania:
Federal regulators stomp on Amish selling raw milk.
Something tells me the Amish don't vote, and the consumers of raw milk did not vote for Ronald Reagan, who hated government interference with the free market.
SeekingAlpha: Update on Seven Bakken Companies With Market Cap $1B to $6B
Link here.
The contributor is long BEXP, NOG.
The companies covered in this group:
The contributor is long BEXP, NOG.
The companies covered in this group:
- SM
- ERF
- OAS
- KOG
- NOG
- BEXP
- MDU
Whiting (WLL) Misses By 5 Cents
Link here. Minimal information at the link.
Conference call later.
Many thoughts, but will wait for the conference call.
Conference call later.
Many thoughts, but will wait for the conference call.
XOM Beats Forecasts -- 1Q11
CNBC reporting: analysts forecast $2.07; actual $2.14.
Link here.
Rigzone.com: XOM earnings soar 69%.
Earnings represents highest quarter since 3Q08. $14 billion in 3Q08 and $11 billion this quarter (1Q11).
The numbers are said to have "surprised" analysts.
Link here.
Rigzone.com: XOM earnings soar 69%.
Earnings represents highest quarter since 3Q08. $14 billion in 3Q08 and $11 billion this quarter (1Q11).
The numbers are said to have "surprised" analysts.
Peak Oil? What Peak Oil -- A Story That Includes The Bakken
According to the federal government, despite headwinds, "domestic oil production reversed decades-long decline in 2009 and 2010."
The report highlights activity in two areas: the permitorium in the Gulf and the boom in the Bakken.
The report highlights activity in two areas: the permitorium in the Gulf and the boom in the Bakken.
While much of the increase in 2009 was associated with deepwater developments in the Federal Gulf of Mexico, the increase in 2010 was led by escalating horizontal drilling programs in US shale plays, notably the North Dakota section of the Bakken formation.
Gasoline Prices to Peak, Then Gradually Fall Back -- US Government
From Energy Information Agency (EIA): gasoline prices will peak over next few weeks, then gradually fall back. Real prices should peak in June, 2011, and then fall back slightly by December, 2012.
Graph here.
When you get to this link, scroll down to April 27, 2011.
Graph here.
When you get to this link, scroll down to April 27, 2011.
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