Continental recently completed two leasehold acquisitions totaling 22,600 net acres in the Bakken. The acquired acreage is located within prime areas on and west of the Nesson Anticline in North Dakota. A majority of the newly acquired acreage is held by production.Close to 925,000 net acres.
Saturday, October 8, 2011
CLR Acquired Top Bakken Acreage -- Bakken, North Dakota, USA
This was reported earlier this week; I finally got around to it:
Western Montanans Moving to MonDak Oil Patch -- Bakken, North Dakota, USA
Link here.
Even now, Rauschendorfer says he gets weekly calls from western Montana residents. He’s also getting calls from out of state such as from Washington state where five contractors are looking to set up shop, and Virginia where parties there are interested in truck driving opportunties and investment properties. These businesses say if they don’t move, they’ll be bankrupt.Go to the link for the full story. Something tells me we're in the very early innings of this boom.
“I’m hearing too many people say they’re going to be bankrupt in two years,” Rauschendorfer said, which leads him to believe that “we’re not in a recession, we’re in a depression.” That means many more could flood the MonDak region. Rumor has it that as many as 90,000 newcomers could flock to the MonDak region as soon as next year.
When it comes to tracking businesses on the move, unfortunately it’s impossible to verify for sure if western Montana businesses are actually flocking eastward. Neither the Montana Department of Labor and Industry nor the Secretary of State’s office track that kind of information. All one can go on is by sight, either by those who are advertising or the logos on vehicles.
It seems, however, many businesses making their way to Richland County are construction related – Meadowlark Log Homes, from Libby; Crazy Cabinetry, Livingston; Markovich Construction (constructing the new hotel on Central), Butte; and Kamp Construction, Lewistown, whose owner, Greg Kamp found work in one hour after arriving here, among them. But then there are the plumbers and electricians from the same areas hired by the contractors who are already doing work.
If You Liked Solyndra, You Will Love Nevada Geothermal -- It Won't Cost the Taxpayer's Quite As Much
Link here.
By the way, I think the wind power folks in northwest United States are in bigger trouble than we hear: the hydroelectric dams this past year provided so much electricity, the wind power-generated electricity was neither needed nor bought.
The next big bankruptcy is likely to be Nevada Geothermal Power, a company that benefited from its connections with Sen. Harry Reid. Its own auditor concluded in a filing released last month that there was “significant doubt about the company’s ability to continue as a going concern.” Not to worry, the government has invested $79 million in loan guarantees plus about $70 million in grants in this particular boondoggle, so this failure is a bit cheaper than Solyndra.Ya gotta love renewables. By the way, Spain is close to bankrupt, if not technically bankrupt, and much of it goes back to their bet on wind power. As least that's my myth. I will let other folks go down that rabbit path.
By the way, I think the wind power folks in northwest United States are in bigger trouble than we hear: the hydroelectric dams this past year provided so much electricity, the wind power-generated electricity was neither needed nor bought.
Harassment, Pure and Simple -- the Bakken, North Dakota, USA
Updates
May 1, 2012: Speaking of harassment -- anyone who has questioned my world view that this administration is out to destroy the oil and gas industry, is more proof needed?
Armendariz used a metaphor that he acknowledged was “crude” to portray the enforcement practices of the EPA.
“It was kind of like how the Romans used to conquer little villages in the Mediterranean. They’d go into a little Turkish town somewhere, they’d find the first five guys they saw, and they would crucify them. And then you know that town was really easy to manage for the next few years,” Armendariz said.
“You make examples out of people who are not complying with the law,” he added.
“It is no secret in Texas, the heart of America’s oil and gas industry, that the EPA has become a petty, arbitrary and demagogic organization. It is a sad fall for an institution charged with safeguarding the public,” a letter signed by 26 members of Congress sent to Jackson on Friday said.
Original Post
At this link, read this paragraph:Carter in his time imposed an excess profit tax and behold, soon there was no profit. It was but a matter of a few months when America’s rig count on active wells went from 4,500 to less than 55 in response to Carter’s meddling. Today, drilling permits are delayed or denied, causing projects to be abandoned. Oil and gas companies in North Dakota are charged with killing 28 birds in violation of the Migratory Bird Act and could face six months in jail, while bird-killing Cuisinart-like wind farms are ignored. Michael Fry of the American Bird Conservancy estimates that wind turbines kill between 75,000 and 275,000 birds per year, including an average of 80 golden eagles per year. Yet, there is no record of the Justice Department bringing a case against wind companies. This isn’t law enforcement, it is simple harassment dressed up as law enforcement.Then, look at this PDF, and look at the off-shore drilling chart.
From all I can tell, based on mainstream media, the federal response to the 2010 oil spill in the gulf caused more economic damage (which is ongoing) than the original spill itself. The oil industry stopped the spill, and paid for the clean-up, and it's pretty much over, based on mainstream media reports. The government showed up with lawyers, briefcases, yellow legal pads, and laptops.
By the way, exactly who in the oil industry goes to jail for six months if found guilty of killing 26 migratory birds (ducks)?
If bird watchers and bird conservationists aren't at all sick of the thought of more whopping crane killers being put up, it speaks volumes about their sincerity. Wow, I am reminded of Dr Zhivago: when the wrong city was scorched, the perpetrators felt that the error was justified in the overall big picture.
Saudi: World Is NOT Over-Supplied With Oil
Link here.
Saudi Arabian Oil Minister Ali Al- Naimi said there’s no excess supply in world oil markets and that the kingdom has been adjusting output to match fluctuating demand over recent months.
“There is no oversupply in the market right now,” he told reporters in Dhahran today.
The country, OPEC’s biggest producer, will keep pumping at current rates even if Libyan output returns to the market this year, as long as customers are in need of the oil, the minister said. The Organization of Petroleum Exporting Countries meets next on Dec. 14 in Vienna to decide whether it needs to alter production targets.
Saudi Arabia supplied 9.39 million barrels of crude oil a day to the market in September, Al-Naimi said. Corresponding figures for June, July and August were 9.8 million, 9.6 million and 9.8 million, he said.
BHI Graphs -- Let the Reader Look For the Obvious Puzzle Piece That Is Missing
Link here.
See if you can see the puzzle piece that is missing (the puzzle pieces are all squares). I will have egg on my face if that puzzle piece is there, but I have looked at the PDF several times, and I still think a piece is missing. Please tell me I'm wrong.
On a serious note, for those folks who say the permitorium in the Gulf does not continue, pay particular attention to that graph.
I.N.C.R.E.D.I.B.L.E.
See if you can see the puzzle piece that is missing (the puzzle pieces are all squares). I will have egg on my face if that puzzle piece is there, but I have looked at the PDF several times, and I still think a piece is missing. Please tell me I'm wrong.
On a serious note, for those folks who say the permitorium in the Gulf does not continue, pay particular attention to that graph.
I.N.C.R.E.D.I.B.L.E.
I Can't Make This Stuff Up ---
An entrepreneur has promised to solve all your telephone headaches in the Bakken, by providing an on-line social network for oil rig workers in the Williston Basin oil patch.
The company man/woman on a rig should take out his/her big black book of out-dated business cards and add another telephone number to find out more about this coming service.
I cannot make this stuff up.
I honestly do not believe Zuckerman (or whatever his name was) started Facebook with an invitation for folks to call his dorm room telephone to learn how to connect.
“A company man on the rig has a big black book of out-dated business cards,” Paulson said. “When he needs something, he has to call through all these numbers. When a company man needs something, they can just log-in and search for what they need.”To access more information regarding this new on-line social network, telephone: 701-645-1151.
The company man/woman on a rig should take out his/her big black book of out-dated business cards and add another telephone number to find out more about this coming service.
I cannot make this stuff up.
I honestly do not believe Zuckerman (or whatever his name was) started Facebook with an invitation for folks to call his dorm room telephone to learn how to connect.
These Stories Warm the Cockles of My Heart -- Bakken, North Dakota, USA
Cockles:
The story is a regional link so it may break early; you may want to go to the link sooner than later.
This is why I strongly support state-of-the-art, professionally-run man-camps. Lack of man-camps won't stop the Bakken boom. It is what it is, and I am at lost to find a better solution to the current housing problem.
I have no problem with a temporary moratorium on man-camp applications to give the county a chance to sort out what's going on (although I think there are better options than moratoria), but the worse thing that can happen is unregulated man-camps going up or workers dispersing to unregulated "frat houses" inside city limits, and perhaps even to farmsteads.
Target Logistics has "zero tolerance" when it comes to alcohol, drugs, fights, liaisons, etc., something that the average apartment complex and "frat houses" don't have. I'm not saying "things don't go on" at professionally run man-camps, but there is a concerted effort to keep infractions to a minimum.
I digress.
So, while some folks are wringing their hands over the man-camps, Target Logistics is working on solutions.
But this is what I really thought was interesting about the story. Their waste water treatment plant will have excess capacity, and "they" are thinking about handling waste product from other North Dakota towns and villages, and perhaps other man-camps. Remember, there is a 2,500 man-camp going up west of Tioga, also.
The clean water from the waste water treatment plan will be sold to fracking companies.
Where some people see a problem, they can only complain. Others see problems as an opportunity.
Ya gotta love it.
This is commentary and I generally don't post comments to commentary unless the comments correct factual errors or add something to the story.
The common English phrase 'it warms the cockles of my heart', is used to signify that a feeling of deep-seated contentment is triggered.Okay, now back to the story.
Differing derivations of this phrase have been proposed, either directly from the perceived heart-shape of a cockleshell, or indirectly (the scientific name for the type genus of the family is Cardium, from the Greek for heart), or from the Latin diminutive of the word heart, corculum.
Another proposed derivation is from the Latin for the ventricles of the heart, cochleae cordis, where the second word is an inflected form of cor, heart, while cochlea is the Latin for snail.
The story is a regional link so it may break early; you may want to go to the link sooner than later.
Some of the strain on community water treatment facilities will be alleviated with a new on-site waste water treatment plant at Target Logistics’ Tioga Lodge.While some local folks are wringing their hands over man-camps, others are working to find solutions.
According to a press release, the $3 million plant, to be completed in November, will handle more than 180,000 gallons of waste water per day, generated by the 1,300 people soon to be living there.
This is why I strongly support state-of-the-art, professionally-run man-camps. Lack of man-camps won't stop the Bakken boom. It is what it is, and I am at lost to find a better solution to the current housing problem.
I have no problem with a temporary moratorium on man-camp applications to give the county a chance to sort out what's going on (although I think there are better options than moratoria), but the worse thing that can happen is unregulated man-camps going up or workers dispersing to unregulated "frat houses" inside city limits, and perhaps even to farmsteads.
Target Logistics has "zero tolerance" when it comes to alcohol, drugs, fights, liaisons, etc., something that the average apartment complex and "frat houses" don't have. I'm not saying "things don't go on" at professionally run man-camps, but there is a concerted effort to keep infractions to a minimum.
I digress.
So, while some folks are wringing their hands over the man-camps, Target Logistics is working on solutions.
But this is what I really thought was interesting about the story. Their waste water treatment plant will have excess capacity, and "they" are thinking about handling waste product from other North Dakota towns and villages, and perhaps other man-camps. Remember, there is a 2,500 man-camp going up west of Tioga, also.
The clean water from the waste water treatment plan will be sold to fracking companies.
Where some people see a problem, they can only complain. Others see problems as an opportunity.
Ya gotta love it.
This is commentary and I generally don't post comments to commentary unless the comments correct factual errors or add something to the story.
Takeaway Capacity -- Bakken, North Dakota, USA
This is an interesting story, about Hess and the oil-loading facility at Tioga.
But, I am hearing that Enbridge (pipelines) and the crude-by-rail folks have been hit with increasing requests: it's just a rumor, mostly just an idle comment from someone standing in line for coffee, but when you hear that comment and then read this story, it really does suggest that all those stories from state officials and corporate presentations about adequate takeaway capacity suggest that production and takeaway capacity is more finely balanced that I was led to believe a few months ago.
Then add the statement by Lynn Helms a couple days ago: North Dakota produced about 400,000 bopd in August, which is already quite remarkable, close to Alaska's and California's 550,000 bopd (each state), and then Lynn Helms said this a couple days ago: North Dakota could be producing as much as 800,000 bopd by the end of the year. That's two months from now but for reporting purposes, we won't know until February, 2012.
Alan Fuller, operations manager of the Hess crude-by-rail facility west of Tioga, reported that construction continues and until the pipeline and the automated features are complete in December, transloading from trucks onto railway cars will be conducted.I would assume that most folks will simply read this as another unremarkable story, just another story in the Bakken. And maybe it is.
Beginning Oct. 17, 40 to 45 trucks a day will be traveling north from US 2, up Co. Road 21 to the facility, where the oil will be loaded onto railway cars.
It's a regional link that will break early so if you want to read it, you may want to read it sooner than later.
But, I am hearing that Enbridge (pipelines) and the crude-by-rail folks have been hit with increasing requests: it's just a rumor, mostly just an idle comment from someone standing in line for coffee, but when you hear that comment and then read this story, it really does suggest that all those stories from state officials and corporate presentations about adequate takeaway capacity suggest that production and takeaway capacity is more finely balanced that I was led to believe a few months ago.
Then add the statement by Lynn Helms a couple days ago: North Dakota produced about 400,000 bopd in August, which is already quite remarkable, close to Alaska's and California's 550,000 bopd (each state), and then Lynn Helms said this a couple days ago: North Dakota could be producing as much as 800,000 bopd by the end of the year. That's two months from now but for reporting purposes, we won't know until February, 2012.
2012: The Year for McKenzie County -- Bakken, North Dakota, USA
The days, months, and years, with regard to the Bakken, are starting to run together.
I can't remember if I called 2010 or 2011 would be the year for KOG (calling it a year earlier) when Senator Dorgan broke through the federal bureaucracy to start getting the permits on the reservation moving and approved.
The year prior to that belonged to EOG in the Parshall oil field.
The tea leaves tell me that 2012 will belong to McKenzie County. I base that mostly on the permits that have been issued in the past six months; private conversations with four different folks from four different oil companies in the Bakken; c) personal observation as recently as today; and, d) stories like this one. This story, about the Watford City budget, is full of little nuggets, and I will post some data points later if I don't forget.
It's a regional link that will break early, so if you want to read it, I would do it sooner than later.
I would have missed it. Don, thank you, sent me the link, as well as several others.
I can't remember if I called 2010 or 2011 would be the year for KOG (calling it a year earlier) when Senator Dorgan broke through the federal bureaucracy to start getting the permits on the reservation moving and approved.
The year prior to that belonged to EOG in the Parshall oil field.
The tea leaves tell me that 2012 will belong to McKenzie County. I base that mostly on the permits that have been issued in the past six months; private conversations with four different folks from four different oil companies in the Bakken; c) personal observation as recently as today; and, d) stories like this one. This story, about the Watford City budget, is full of little nuggets, and I will post some data points later if I don't forget.
It's a regional link that will break early, so if you want to read it, I would do it sooner than later.
I would have missed it. Don, thank you, sent me the link, as well as several others.
Update on Storhaug 157-100-2A-11-1H, File No 19646 -- Bakken, North Dakota, USA
Follow-up to a comment some time ago.
See the sixth comment or so at this link, regarding fracking. This was the comment:
Notice the "F" designation -- no pump is put on the well as of the reporting date below. The well produced almost 12,000 bbls in August. Looks like a nice well.
NDIC File No: 19646
Monthly Production Data
See the sixth comment or so at this link, regarding fracking. This was the comment:
- I was assuming a pump as all other wells in the area are being pumped and flared.
- The file number is 19646 - T157R100 Section 2 and still confidential.
Notice the "F" designation -- no pump is put on the well as of the reporting date below. The well produced almost 12,000 bbls in August. Looks like a nice well.
NDIC File No: 19646
Well Type: OG Well Status: A Status Date: 7/31/2011 Wellbore type: Horizontal
Current Operator: PETRO-HUNT, L.L.C.
Current Well Name: STORHAUG 157-100-2A-11-1H
Total Depth: 19948 Field: WILDCAT
Spud Date(s): 3/20/2011
Completion Data
Pool: BAKKEN Perfs: 10399-19948 Comp: 7/31/2011 Status: F Date: 8/1/2011
Cumulative Production Data
Pool: BAKKEN Cum Oil: 13071 Cum MCF Gas: 13366 Cum Water: 33623
Production Test Data
IP Test Date: 8/1/2011 Pool: BAKKEN IP Oil: 482 IP MCF: 389 IP Water: 2819
Current Operator: PETRO-HUNT, L.L.C.
Current Well Name: STORHAUG 157-100-2A-11-1H
Total Depth: 19948 Field: WILDCAT
Spud Date(s): 3/20/2011
Completion Data
Pool: BAKKEN Perfs: 10399-19948 Comp: 7/31/2011 Status: F Date: 8/1/2011
Cumulative Production Data
Pool: BAKKEN Cum Oil: 13071 Cum MCF Gas: 13366 Cum Water: 33623
Production Test Data
IP Test Date: 8/1/2011 Pool: BAKKEN IP Oil: 482 IP MCF: 389 IP Water: 2819
| Pool | Date | Days | BBLS Oil | Runs | BBLS Water | MCF Prod | MCF Sold | Vent/Flare |
|---|---|---|---|---|---|---|---|---|
| BAKKEN | 8-2011 | 31 | 11653 | 12050 | 24777 | 10612 | 0 | 10395 |
| BAKKEN | 7-2011 | 3 | 1418 | 473 | 8846 | 2754 | 0 | 2712 |
Add Iowa Public Television to List of Media Outlets Reporting On the Bakken -- Bakken, North Dakota, USA
Earlier this week Iowa Public Television was in town (Williston, North Dakota) doing a story on the Bakken.
Hopefully someone will catch the story when it is aired and send the link if I miss it.
The car they were driving in could probably fit inside the cab of a Western Star truck/tractor.
Hopefully someone will catch the story when it is aired and send the link if I miss it.
The car they were driving in could probably fit inside the cab of a Western Star truck/tractor.
Contagion Hits Minot -- The "Bakken" Effect -- Bakken, North Dakota, USA
Minot apartment complex doubling rent. I doubt their expenses doubled.
This apartment complex was bought by a group out of San Franciso, Ms Pelosi's home district. The "as weather and circumstances permit" is known in the industry as the "Pelosi clause."
Residents at The Manor Apartments in southeast Minot had a rude awakening on the evening of Oct. 6.Definition of "contagion: The spread of a behavior pattern, ... through imitation.
Four-page notices were taped to the doors of the 91 units. The text on the first page stated that the apartment complex was bought by Belveron Real Estate Partners, a San Francisco-based firm.
"Belveron is looking to make a lot of good changes to the property in the near future and will continue with those changes as weather and circumstances permit," the notice reads.
This apartment complex was bought by a group out of San Franciso, Ms Pelosi's home district. The "as weather and circumstances permit" is known in the industry as the "Pelosi clause."
From SeekingAlpha: Bakken Oil Play Moving to Williams and McKenzie Counties -- Bakken, North Dakota, USA
We've been saying for quite some time that the activity was moving to McKenzie County. Others are now saying it:
The link takes you to a great article, but the headline is a bit misleading. The headline is accurate based on my data, but the writer doesn't provide much data other than anecdotal examples of great wells. If I get a chance, I will provide data of how many permits have been issued for McKenzie wells compared to Mountrail wells in the past six months.
For now, suffice it to say, this is what I'm seeing:
CLR: Continental is the largest acreage holder in the Bakken with 901000 net acres. This is more than double ExxonMobil's 450,000 net acres it acquired from its merger with XTO. 72% of this acreage is in North Dakota. 68% of its Bakken/Three Forks acreage is de-risked. Continental is the number one oil producer in the Williston Basin. Continental also has Red River production which is also in the Williston Basin. Its Bakken production grew 51% year over year from the second quarter of this year. 49% of Continental's 421 million Boe proved reserves are in the North Dakotan Bakken. It has 23 operated rigs in the Bakken/Three Forks. Continental's EURs for North Dakota Bakken wells is 603 MBoe. Keep in mind this is an average as several other competitors estimate EURs much higher.
The link takes you to a great article, but the headline is a bit misleading. The headline is accurate based on my data, but the writer doesn't provide much data other than anecdotal examples of great wells. If I get a chance, I will provide data of how many permits have been issued for McKenzie wells compared to Mountrail wells in the past six months.
For now, suffice it to say, this is what I'm seeing:
- Minimal EOG drilling in the Parshall; it appears the company is holding their leases on production; "every" section has one well
- Whiting is maxing out the Sanish; using it as a cash cow to fund other operations; this will also give us a good idea how much the formations communicate with each other, and whether 1000-foot spacing is adequate with regard to horizontal fractures; is there any merit in putting in additional wells but drilling against the grain (i.e., old well, heel-to-toe; new well, toe-to-heel)
- Lots of activity in the Williston area but mostly on permits issued some time ago
- Huge number of permits being issued in McKenzie County
- Dunn and Stark being developed in a methodical, but at a much slower pace than McKenzie and Williams
CLR: Continental is the largest acreage holder in the Bakken with 901000 net acres. This is more than double ExxonMobil's 450,000 net acres it acquired from its merger with XTO. 72% of this acreage is in North Dakota. 68% of its Bakken/Three Forks acreage is de-risked. Continental is the number one oil producer in the Williston Basin. Continental also has Red River production which is also in the Williston Basin. Its Bakken production grew 51% year over year from the second quarter of this year. 49% of Continental's 421 million Boe proved reserves are in the North Dakotan Bakken. It has 23 operated rigs in the Bakken/Three Forks. Continental's EURs for North Dakota Bakken wells is 603 MBoe. Keep in mind this is an average as several other competitors estimate EURs much higher.
XOM To Spend Record Amount in CAPEX -- Bakken, North Dakota, USA
In light of the supply and demand issues and the sharp decline in oil prices, this is very, very interesting:
ExxonMobil Chief Executive Rex Tillerson said Thursday the company expects to spend a record $37 billion on capital projects this year, almost 9% more than it has previously said it was planning to invest.Link here.
ExxonMobil's acquisition last year of natural-gas producer XTO Energy for $25 billion was a "recognition of how significant the unconventional resources are going to be," Tillerson said. Exxon Mobil expects unconventional resources, such as shale oil and gas, to increase five-fold in the next five years.For newbies, XTO is in the Bakken.
The head of ExxonMobil said the global economy is likely to continue growing but at a slower pace than previously anticipated. "We are going to continue, I'm afraid, to be in a fairly sluggish economic environment in this country," Tillerson said. "Globally, the economy is probably not going to perform quite as robust as we have expected because the U.S. and Europe are a big piece of that regardless of how well China does."
ConocoPhillips to Split in Two: Downstream and Upstream
Update
See first comment below. I had forgotten that this was already announced, at least as far back as July 14, 2011. I must have completely forgotten because I follow COP pretty closely. A big thank you for everyone bearing with me when I make these mistakes.
Original Post
I posted this yesterday: "For Investors Only: Be Prepared for Some Major Announcements Regarding Mergers."
The timing could not have been better; the subject could have been worded a bit differently, but here's the news: ConocoPhillips will split in two -- downstream and upstream. Huge. For investors that's even bigger than a merger. Wow.
The repositioning is expected to be completed in the second quarter of 2012. That's just a few months from now. In less time than it takes to get an environmental impact study for the Truck Reliever Route completed.
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