Price of Natural Gas Soon To Reach Tipping Point

Again, the price of natural gas has risen, catching me by surprise.

Many months ago (a year or so ago?) I posted that when natural gas hits $5, a lot of oil and gas exploration and production companies are going to start looking real good.

Well, I see natural gas is now up to $4.65. This is getting a bit exciting.

The link is a dynamic link and the value will change over time.

The GM Chevy Volt Scam -- I Can't Make This Stuff Up -- Not a Bakken Story

Link here.

Automobilemag.com reports that General Motors has responded to my report questioning whether dealerships are gaming Chevy Volt tax credits. Chevy Volt spokesperson, Rob Peterson, states that "NLPC is confused." He then goes on to confirm that the dealerships purchasing Chevy Volts and reselling them as used vehicles are entitled to the $7,500 tax credit. Clearly, it is GM that is confused, considering that this was the main point of my report.

This is really quite incredible. Something tells me Volts are not being bought by limousine liberals.

The report goes on:

GM does not deny that Chevy dealerships are selling Chevy Volts to other dealerships, including a KIA dealership, for resale. At the same time, Peterson also touts the high demand for Volts claiming, "we don't sell Volts at the moment - it's almost like we deliver them."

By this statement, you wouldn't know that sales for the Volt averaged a dismally low 425 per month for the first four months of the year. GM recently stated that they had the capacity to build at a pace of 17,000 per year. So, here's a question for GM and Mr. Peterson: If demand is so high for the Chevy Volt, why would a Chevy dealership sell the vehicle to other dealerships, particularly when there are supposedly customers lined up to pay full price? The answer seems clear to me. GM is exaggerating the "high demand" for the Volt.

Truly incredible. But then what would one expect from Government Motors? It's all about perception.

Five (5) New Permits -- Bakken, North Dakota, USA

Daily activity report for May 31, 2011 --

Drillers: Whiting (2), Hunt, Zenergy, and Petro Harvester

Fields: Ross, Gaylore, Dore, Sanish, and Renville

Whiting, as usual, one well in its cash cow, the Sanish, and another permit elsewhere; in this case Gaylord.

No other information posted today.

Flood Update -- First Time Ever: Corps Will Raise Spillway Gates at Garrison -- Public Cleared Out

Link here. From the Bismarck Tribune:

History will be made at 8 a.m. Wednesday when for the first time ever the U.S. Army Corps of Engineers raises Garrison Dam spillway gates to help relieve a massive amount of water in Lake Sakakawea behind the dam.

The lake level is less than 1 foot from overtopping the spillway and the corps will raise about half of the 28 gates to control the flow and equalize output between the regulatory tunnels on the west side of the dam and the spillway on the east side, said Lake Sakakawea manager Linda Phelps.

The gates will be raised about 1 foot and will release about 15,000 cubic feet per second down the massive spillway apron, into the spillway pond far below and through an outlet channel out to the Missouri River.

Because the corps doesn't know exactly where the spillway water will flow, or how high it will get before the channel kicks into full running capacity, some precautionary measures are being taken to protect the public, Phelps said.

June Hearing Dockets for North Dakota Are Posted

Link here.

Hess has allocated one-third of their total worldwide CAPEX to North Dakota Bakken -- and it is starting to show.....

• Hess with requests for dozens of new wells
• Hess with more than 60 requests for pooling (about the last step before drilling)

Case 15150 is interesting: Slawson -

• 640-acre unit, 11-152-93, 3 wells
• 640-acre unit, 12-152-93, 3 wells
• 640-acre unit, 12-152-92, 6 wells
• 640-acre unit, 7-152-91, 6 wells
• 640-acre unit, 8-152-91, 6 wells
• 640-acre unit, 9-152-91, 6 wells
• So, if I am reading that correctly, in Fort Berthold, in this single case, Slawson is requesting permits for 30 wells, which includes 6 wells on 4 640-acre units, and then what amounts to 6 wells on a 1280-acre unit. Six wells on a 640-acre unit is impressive. Maybe more on that later. If I am misreading this, hopefully someone will point that out to me. Remember, EURs for core Bakken wells are in the range of 700,000 bbls and there is minimal depletion/communication between horizontal wells in neighboring Bakken/Three Forks formations.

15067: 5 wells on a 640-acre unit, 29-149-92; Heart Butte-Bakken, Dunn; this is in addition to four wells on a 1280-acre unit 17/20-149-92. Sections 17/20/29 lie on a north-south axis.

15119: XTO, about 22 1280-acre units; 6 wells each; 132 wells, Heart Butte-Bakken, Dunn (I have to confirm this one)

Remember: Dakota-3 is a subsidiary of WMB. Dakota-3 acquired 50+ Zenergy wells recently. WMB acquired about 7 percent of the Fort Berthold Indian Reservation's mineral acres.


Note case 14310, cont: True Oil LLC, proper spacing for Burlington Resources 11-1H, Red Wing Creek-Madison, McKenzie, and then click here for the "rest of the story."

Wednesday, June 22, 2011

14916: Whiting, proper spacing for Ray-Red River Gas Pool, Wms
14917: Oasis, temporary spacing for Twobins 5501-42-20H, and Drummond 5501-44-21H, Wms
14918: Oasis, allow unrestricted production in Strandahl-Bakken, Wms
14919: Oasis, allow max production of Grimstvedt Federal 5703 42-34H, Strandahl-Bakken, Wms
14920: Oasis, allow max production of Cowden 5404 13-35H, Painted Woods-Bakken, Wms
14921: Hess, to establish a 1920-acre unit; 6 hz wells; Mountrail County, 155N-94W
14922: Hess, 3 hz wells on 5 spacing units, Beaver Lodge-Bakken, Wms, 15 wells total?
14923: Hess, 6 hz wells on one 1280-unit, Big Gulch-Bakken, Dunn
14924: Hess, 3 hz wells on one 1280-unit, Capa-Bakken, Wms
14925: Hess, 4 hz wells in one 640-acre section, Cedar Coulee-Bakken, Dunn
14926: Hess, 3 hz wells on one 1280-unit, Hofflund-Bakken, Wms
14927: Hess, revoke a Ursa permit, Wilson 36-35H, McKenzie
14928: Hess, revoke an OXY USA permit, Steve Kudrna 1-32-29H-143-95, Dunn
14929: Hess, add 8 sections to Ray field; 3 hz wells/1280-acre unit, 12 wells?, Wms
14930: Hess, designate two 1280-acre units in East Fork-Bakken, Wms
14931: Hess, add 4 sections to Camp field, Wms and McKenzie
14932: Hess, 3 hz wells on four spacing units, Oliver-Bakken, 12 wells?, Wms
14933: Hess, 3 hz wells on 14 spacing units; 42 wells, Wheelock field, Wms
14934: Hess, to complete the EN-Cvancara A-156-93-3231H-1, Mountrail
14935: Hess, revoke a CLR well, Foster 1-28H, Wms, McKenzie
14713, cont: Hess, proper spacing for Big Gulch-Bakken, Dunn
14245, cont: Hess Bakken Investments II, revoke a Sinclair permit, Robert Peterson 11-3H, McKenzie
14325, cont: Hess Bakken Investments II, add two sections; designate two 1280-acre units, Truax-Bakken, Wms, McK
14936: Petro Harvester Operating, convert Cameron 1-12, Kuroki Field, to injection, Bottineau
14937: Petro Harvester Operating, 2 wells on each 80-acre unit, South Coteau-Madison, Burke
14938: Petro Harvester Operating, 2 wells on each 80-acre unit, Columbus-Madison, Burke
14939: Cornerstone, establish a 1280-acre unit, 1 hz well, Burke
14940: Cornerstone, to include two sections in Coteau-Bakken; 1 hz well, Burke
14941: Cornerstone, add 1 section; establish 2 1280-acre units; Little Butte-Bakken, 1 hz well each, Burke
14942: Cornerstone, add 2 sections; 1 hz/1280-acre unit; Foothills-Bakken, Burke
14943: OXY USA, max production in Cabernet-Bakken, Dunn
14944: Murex, 1 hz in a 1280-acre unit, McK
14945: Newfield Rocky Mountains, revoke a CLR permit, Stockton 1-28H, Wms
14946: Marathon, 4 hz wells on each 1280-acre unit; 3 units; 12 wells, Van Hook-Bakken, Mountrail
14947: Marathon, 4 hz wells on each 1280-acre unit; 3 units; 12 wells, Big Bend-Bakken, Mountrail
14948: Marathon, 4 hz wells; 1280-acre units; all units in 4 townships; Reunion Bay-Bakken, Mountrail, McK
14949: Marathon, max production in Reunion Bay-Bakken, McK
14950: KOG, to establish 640-acre units in two sections; 3 hz wells in each; to establish a 1280-acre unit for 5 wells; MonDak-Bakken, McKenzie
14951: KOG, establish a 1280-acre unit; 2 hz wells; Moccasin Creek-Bakken, Dunn
14952: Petro-Hunt, salt water disposal
14953: Petro-Hunt, salt water disposal
14725, cont: SM Energy, proper spacing for West Ambrose-Bakken, Divide
14231, cont: SM Energy, revoke a CLR permit for Koeser 1-11H, McK
14762, cont: Petro-Hunt, revoke a Newfield permit for Jackman 156-100-110201H, Wms
14763, cont: GMXR, to establish a 1280-acre unit, 1 hz well; McKenzie
14764, cont: GMXR, extend Ranch Creek; 2 sections; one-1280-acre unit, McK
14451, cont: Sequel, to establish 6 1280-acre units; 1 hz well each; McK
14310, cont: True Oil LLC, proper spacing for Burlington Resources 11-1H, Red Wing Creek-Madison, McK
14954: KOG, saltwater disposal, Pembroke field, McK
14955 - 14961: Whiting, pooling in Big Stick-Bakken, Billings
14962: Oasis, flaring, Contreras 5502 42-7H, Wms
14963: Oasis, flaring, Ernst 6092 42-31H, Burke
14964: Oasis, flaring, Vuki 5502 42-7H, Wms
14965 - 15027: Hess, pooling in many different fields across the Bakken
15028: Petro-Hunt, pooling in Powers Lake-Bakken, Mountrail
15029: OXY USA, pooling in Dimond-Bakken, Burke
15030: OXY USA, pooling in Dimond-Bakken, Burke
15031 - 15035: SM Energy, pooling in several fields
14732, cont: Cornerstone, saltwater disposal
15036: Zenergy, establish 1 1280-acre unit, and 1 640-acre unit, McK
15037: North Plains, extend Truax, establish 1 1280-acre unt; up to 7 wells in that zone, Wms, McK
14771, cont: North Plains, temporary spacing for Collyer 9-8H
14519, cont: North Plains, extend Truax, establish 1 1280-acre unit; up to 6 wells in that zone, Wms, McK
14527, cont: North Plains to revoke CLR permit for Sharon 1-17H, Wms
14541: Oil for America, temporary spacing for Zastoupil 22-1, Stark
15038: Landtech, saltwater disposal
15039: SBG Disposal, saltwater disposal
15040: Saltwater Disposal of ND, saltwater disposal
15041: Saltwater Disposal of ND, saltwater disposal
15042: DRD Saltwater Disposal, saltwater disposal
15043: DRD Saltwater Disposal, saltwater disposal

Thursday, June 23, 2011

15044: Samson Resources, temporary spacing Haugland 16-21-163-98H
15045: OXY USA, proper spacing for Dimond-Bakken, Burke
15046: Newfield, et al, proper spacing for Sand Creek-Bakken, McK
15047: Newfield, 8 1280-acre units; 5 wells per unit; 40 wells; South Tobacco Garden-Bakken, McK
15048: Newfield, 6 wells on1 1280-acre unit; Westberg-Bakken, McKenzie
15049: EOG, define Squaw Creek-Bakken, McK
15050: Denbury Onshore, temporary spacing for Joseph 11-1H, McK
15051: Denbury Onshore, extend Arnegard field/Ellsworth field; establish 5 1280-acre units, 1 hz well each; McK
15052: Denbury Onshore, extend Magpie-Duperow; establish a 320-acre unit; 1 hz well; Billings
14787, cont: Denbury Onshore, temporary spacing for Christianson 24-9NEH, McK
14801, cont: Denbury Onshore, revoke Zenergy's permit for Rink 13-24H; McK
15053: Abraxas, 2 wells on a 1280-acre unit, McK
15054: Slawson, establish a 1280-acre unit, Kittleson Slough-Bakken, 1 hz well, Mountrail
15056: Slawson, establish a 1280-acre unit, Van Hook-Bakken, 6 hz wells; Mountrail
15057: Slawson, establish a 1280-acre unit, Big Bend-Bakken, 6 hz wells; Mountrail
14568, cont: Slawson, establish a 320-acre unit, 3 wells, Mountrail
15058: CLR, alter the stratigraphic rules for the Banks-Bakken pool, McK
15059: CLR, establish a 2560-acre unit in Elidah-Bakken; Eco-Pad; multiple wells from the pad, McK
15060: CLR, 2 1280-acre units; increase density; 4 hz wells from each pad; 7 wells on each spacing unit; Eco-Pad, North Tioga-Bakken, Wms
14780, cont: CLR, redefine rules for Upland-Bakken, Divide
14782, cont: CLR, 2 1280-acre units, Stoneview-Bakken/North Tioga-Bakken, Viking field, 1hz well each, Burke
14543, cont: CLR, temporary spacing for Haag 1X-21H, Billings
14356, cont: CLR, create a 2560-acre unit; 4 wells; Eco-Pad; McK
14062, cont: CLR, temporary spacing for Norway 1-5H, McK
15061: Chesapeake, create a 1280-acre unit, 1 hz well, Stark County
15062: Chesapeake, create a 1280-acre unit, 1 hz well, Stark County
15063: Chesapeak, create a 1280-acre unit, 1 hz well, Stark County
15064: Cirque, 2 640-acre units; 1 hz well each, Merer County
15065: Dakota-3, establish a 320-acre unit in Squaw Creek-Bakken; 1 hz well
15066: Enerplus, create a 1280-acre unit, 7 wells, Dunn
15067: Enerplus, 4 wells on a 1280-acre unit; 5 wells on a 640-acre unit, Heart Butte-Bakken, Dunn
15068: GMXR, create a 1280-acre unit, 1 hz well, St Demetrius-Bakken, Billings
15069: GMXR, extend New Hradac-Bakken; create a 1280-acre unit; 1 hz well; Stark County
15070: Zenergy, extend Cartwright/Glass Bluff-Bakken, to establish 2 1280-acre units; 1 hz well each, McK
14784, cont: Newfield, temporary spacing for Christensen 159-102-17-20 1H, Wms
14785, cont: Newfield, create a 1280-acre unit, 6 wells; Sand Creek-Bakken, McK
14786, cont: Newfield, Newfield, create a 1280-acre unit; 6 wells; Siverston-Bakken, McK
14081, cont: Sinclair, temporary spacing for Bighorn 1-6H, Dunn
14370, cont: Encore Energy Partners, temporary spacing for Schutlz 1; McK
14542, cont: Greggory Tank, legalese, risk penalty involving CLR
15071: EOG, risk penalty legalese involving Liberty LR 17-11H, Van Hook-Bakken, Mountrail
15072: EOG, risk penalty legalese involving Liberty LR 19-23H, Van Hook-Bakken, Mountrail
15055: EOG, risk penalty legalese involving Liberty LR 14-233H, Van Hook-Bakken, Mountrail
15073: EOG, risk penalty legalese involving Ross 22-07H, Alger-Bakken, Mountrail
15074: EOG, risk penalty legalese involving Ross 27-2728H, Alger-Bakken, Mountrail
15075: EOG, pooling in Painted Woods-Bakken, Wms
14682, cont: EOG, flaring in Squaw Creek-Bakken, McK
14683, cont: EOG, flaring in Spotted Horn-Bakken, McK, Mountrail
14684, cont: EOG, flaring in Ross-Bakken, Mountrail
14685, cont: EOG, flaring in Parshall-Bakken, Mountrail
14686, cont: EOG, flaring in Antelope-Sanish, Mountrail
14687, cont: EOG, flaring in Clear Water-Bakken, Burke, Mountrail
15076 - 15083: Newfield, pooling across the Bakken
15084: Newfield, 8 1280-acre units; 5 wells each; 40 wells; South Tobacco Garden-Bakken, McK
15085 - 15087: GMXR, pooling, New Hradec-Bakken, Stark County
15088 - 15095: CLR, pooling across the Bakken
14804, cont: Fidelity, 7 1280-acre units; 3 wells each; 21 wells; Stanley-Bakken, Mountrail
15096 - 15098: Zenergy, pooling
15099 -  15113: XTO, pooling
15117: XTO, 1 1280-acre unit; 3 wells; Haystack Butte-Bakken, McK
15118: XTO, 1 1280-acre unit; 3 wells; Midway-Bakken, Wms
15119: XTO, about 22 1280-acre units; 6 wells each; 132 wells, Heart Butte-Bakken, Dunn
15120 - 15130: BEXP, pooling across the Bakken
15131: BEXP, flaring in Catwalk-Bakken, Wms, McK
15132: BEXP, increase density wells on each 1280-acre unit in Zones III and IV of Briar Creek-Bakken, 4 wells each; McK, Wms
15133: BEXP, increase density wells on each 1280-acre unit in Todd-Bakken, 4 wells each; Wms, McK
15134: BEXP, 3 1280-acre units; 4 wells each; 12 wells, Painted Woods-Bakken, Wms
15135: BEXP, increase density wells on each 1280-acre unit in Zones IV, V, and VIII of the Alger-Bakken, 4 wells each; Mountrail
15136: BEXP, 4 1280-acre units; 4 wells each; 16 wells; Elk-Bakken, McK
15137: BEXP, 3 128-acre units; 4 wells each; 12 wells; Bull Butte-Bakken, Wms
15138: BEXP, 1 1280-acre unit; 4 wells; Last Chance-Bakken, Wms
15139: BEXP, 1 1280-acre unit; 4 wells; Glass Bluff-Bakken, McK
15140: BeXP, 3 1280-acre units; 4 wells; East Fork-Bakken, Wms
15141 - 15148: Dakota-3, pooling across the Bakken
15149: Citation, saltwater disposal
15150: Slawson, Fort Berthold Indian Reservation

• 640-acre unit, 11-152-93, 3 wells
• 640-acre unit, 12-152-93, 3 wells
• 640-acre unit, 12-152-92, 6 wells
• 640-acre unit, 7-152-91, 6 wells
• 640-acre unit, 8-152-91, 6 wells
• 640-acre unit, 9-152-91, 6 wells

15151: Slawson, saltwater disposal
15152: Zavanna, saltwater disposal
15153: Dakota-3, et al, flaring in Van Hook-Bakken, Dunn, McLean, Mountrail
15154: Slawson, flaring in Big Bend-Bakken, Mountrail
15155: Dakota-3, flaring in Reunion Bay-Bakken, McKenzie
15156: XTO, flaring in Sorkness-Bakken, Mountrail
15157: Dakota-3, et al, flaring in Heart Butte-Bakken
15158: OXY USA and Cirque Resources, flaring in Dimond-Bakken, Burke
15159: BEXP, flaring in Catwalk-Bakken, Wms, McK
15160: Drilltech, saltwater conversion
14869: Hunt, commingling request
14870: cont: Hunt, commingling request
14871: cont: Hunt, commingling request
14872: cont: Hunt, commingling request
14873: cont: Hunt, commingling request
14695: cont: Baytex, flaring, Whiteaker-Bakken, Divide
14696: Baytex, flaring, Ambrose-Bakken, Divide
14697: Baytex, flaring, Ambrose-Bakken, Divide
14698: Baytex, flaring, Whiteaker-Bakken, Divide

More Global Warming --

Burgess Junction, Wyoming: a photograph is worth a 1,000 pages of warming data published by the "scientific community."

Week 21: May 21 -- May 27, 2011

EPA: Fracking -- No Evidence of Ground Water Contamination 

KOG Makes Huge Acquisition; Acquires Fifth Rig

New Record: 179 Active Drilling Rigs

ONEOK: 62-Mile LNG Pipeline Through McKenzie County

Why the IP is Just One Data Point: A 33-IP Well --> 140,000 Bbls To Date

Update on Hess Natural Gas Plant Expansion Near Tioga

First Observations in Williston -- Heart of the Bakken

How Bad is the Fracking Backlog?

That 3,000 IP Legacy/Bottineau Well? Probably Wishful Thinking

Whiting's Jones 44-35 Well: Lots of Chatter

Update on Future of the Bakken

Five More Hotels To Open In Dickinson By End of 2012 -- Bakken, North Dakota, USA

Link here (regional link).  Another story, same source, dated June 10, 2012 -- same info?

Data points:

• Construction continues on three hotels
• Two more planned by end of 2012

• La Quinta Inn & Suites: 79 rooms, pool
• Candlewood Suites: 90 rooms

• La Quinta in area of Pizza Hut and Country Kitchen
• Candlewood at intersection of Sims and 14th Street East
• Microtel Inn & Suites, could open this week; 79 rooms
• Hampton Inn & Suites, under construction; 85 rooms
• The Astoria (previously Albertson's): 95 rooms

Folks are still skittish about the boom and bust cycle of the oil industry; they've been through this before

“I think those extra hotels coming in are going to be needed,” a spokesperson said. “They’re going to give some relief for the visitor industry coming in.”

However, she is unsure if the hotels will be needed if the oil boom busts.

“Currently we need the hotels,” she said. “We need every room, but we’re going to have to see where prices are at and what happens with the energy industry.”

The Bakken analysis (linked on the sidebar at the right) says that it will take until 2030 to drill out the Bakken and the Bakken will produce through 2100.

Encana Opens First Natural Gas Fleet Fueling Station in DJ Basin, Colorado

Link here. From PennEnergy:

The station, located approximately 30 miles northeast of Denver on County Road 22 in Fort Lupton, Colorado, will serve the fueling needs of the company's DJ Basin natural gas fleet. Encana Natural Gas Inc. will own the station that will fuel the local fleet of field vehicles. The station is located at the Kerr-McGee Platt Valley Plant, which is owned by a subsidiary of Anadarko Petroleum Corporation. 

"This new station represents another significant step toward converting the U.S. fleet to run on cleaner-burning natural gas," said Eric Marsh, Encana's Executive Vice-President & Senior Vice-President, USA Division. In addition to serving the local fueling needs, the station will supply fuel to Anadarko's and Noble Energy, Inc.'s expanding natural gas vehicle fleets in the DJ Basin. The growing needs of these three companies is expected to quickly take daily natural gas throughput to the station's capacity of 500 gasoline gallon equivalent (GGE) - fuel for about 50 vehicles per day.