Link here.
It would be interesting to review the history between 1985 and 1990, or better yet, the years between 1980 and 1985 that might help explain the graph.
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Tuesday, November 1, 2011
First Utica Well Spudded -- Anadarko --
Link here.
Anadarko Petroleum Corp. said it has spudded its first well in the Ordovician Utica shale play in eastern Ohio, where it looks forward to an active drilling program.Anadarko controls 300,000 gross acres in the Utica.
I'm Already Starting to Like Statoil -- It Must Be That Viking Spirit
Statoil tells UK: you keep dissing us, and we will sell our natural gas that we had allocated for England to other countries.
Norway’s Statoil has threatened to sell its North Sea natural gas to other markets if the UK’s Energy Sec. Chris Huhne prevails in his efforts to expand the country’s use of renewable energy and curb the growth of fossil fuel power plants.Yeah, Statoil is alright.
“We will continue to develop new production in the North Sea, but the question is which market it finds its way into,” said Rune Bjornson, Statoil vice-president, natural gas.
“There are other places we can export the gas to apart from the UK. We have the gas you need if you want it,” Bjornson said.
“The UK is one of the most challenging markets at the moment when it comes to reading the future energy policy,” said Bjornson, adding, “We are getting different signals from different parts of government—we don't know which opinion will prevail.”
Wow, Wow, Wow -- So Much for that "Speculator" Crazy Talk
Link here.
Definition of "to speculate": To engage in the buying or selling of a commodity with an element of risk on the chance of profit. And there's something wrong with that?
I can't make this stuff up.
Market fundamentals explain the tripling of oil prices between the beginning of 2007 and middle of 2008, according to two Federal Reserve Bank of Dallas reports on suspicions about the role of speculation. [Let's see, this is past the middle of 2011, so this report took more than three years to complete.]I don't know if the report provided a definition "to speculate" or explained what a speculator what. Definition of speculator: one who speculates
The reports, by Michael D. Plante, research economist, and Mine K. Yucel, senior economist and vice-president, say a surge in the price of crude oil to a peak exceeding $145/bbl in July 2008 occurred in well-functioning futures and physical markets.
Because the increase coincided with increases in futures-market trading and activity by noncommercial traders, questions linger whether speculators pushed prices beyond levels justified by physical supply and demand. Amplifying concern is growth in activity by noncommercial traders, or speculators, from 10-15% of unsettled oil futures contracts on the New York Mercantile Exchange in 2000 to about 40% now. During that period, total trading in oil futures contracts has about tripled.
Despite the coincidence, oil futures prices didn’t conflict with theory about how they should have responded to physical market changes, according to one of the reports.
“During normal times, the futures price should be higher than the spot price—with the premium roughly equaling the cost of storage and lost interest income—and inventories should be abundant,” Plante and Yucel say. “In certain situations, such as when demand is temporarily high or supply temporarily low, the spot price will be higher than the futures price, and inventories will be relatively low.”
Definition of "to speculate": To engage in the buying or selling of a commodity with an element of risk on the chance of profit. And there's something wrong with that?
I can't make this stuff up.
Random Note on Ford F-Series -- The Bakken, North Dakota, USA
Ford sold more than 50,000 F-150s in October: 52,251, averaging 1,685/day vs the Volt at 1,108 for the entire month.
A lot of those Fords were sold in western North Dakota. Many of those sold out-of-state were driven to North Dakota where the jobs are. Ford F-series sales are a barometer of construction activity in the US. This is a good omen.
Enbridge To Increase Pipeline Capacity -- The Bakken, North Dakota, USA
Link here.
Data points:
Data points:
- $90 million project: Bakken Access Program
- Increase gathering capacity by 100,000 bopd
- An upstream project; to be in service by early 2013
- Pipelines, storage tanks, truck access facilities at multiple locations in North Dakota
- Why was expansion necessary?
Seven (7) New Permits -- The Bakken, North Dakota, USA
Daily activity report, November 1, 2011 --
Operators: Triangle USA (4), North Plains, Marathon, QEP
Fields: Truax, Deep Water Creek Bay, Bailey, and Rawson.
Triangle with permits for a 4-well pad in the Rawson -- Rawson is in a great location: just east of Alexander. The Triangle USA Gullickson Trust well will be about six miles southeast of Alexander and/or almost exactly four miles south of Rawson, ND. According to Wikipedia, the population of Rawson is ... six.
Demographics of Rawson, according to Wikipedia:
"There were 2 households out of which 50.0% had children under the age of 18 living with them, and 100.0% were married couples living together. The average household size was 3.00 and the average family size was 3.00." From this one can gather that the grandparents (with no children) live in town with their son or daughter (unlikely both) and their two grandchildren.
It gets better. I was telling this story to an individual who happened to be in the location that I am -- purely random. She said that her grandfather grew up in Ransom. "Isn't that by Alexander?" she asked. Incredible. I cannot make this stuff up. She said the town was once bigger. Her grandfather / grandmother had twelve children, and her grandmother was one of eleven children in her family. Yes, I would say that Ransom, at one time, was bigger.
Okay, back to the work at hand. Two wells came off the "tight hole" status as NDIC now refers to it:
Operators: Triangle USA (4), North Plains, Marathon, QEP
Fields: Truax, Deep Water Creek Bay, Bailey, and Rawson.
Triangle with permits for a 4-well pad in the Rawson -- Rawson is in a great location: just east of Alexander. The Triangle USA Gullickson Trust well will be about six miles southeast of Alexander and/or almost exactly four miles south of Rawson, ND. According to Wikipedia, the population of Rawson is ... six.
Demographics of Rawson, according to Wikipedia:
As of the census of 2000, there were 6 people, 2 households, and 2 families residing in the city. The population density was 24.5 people per square mile (9.3/km²). There were 7 housing units at an average density of 28.5 per square mile (10.8/km²). The racial makeup of the city was 100.00% white.What does this tell me? Either a writer has too much time on his/her hands, or a computer (most likely an android) is generating this information from databanks. No one in his/her right mind would note the percentages of a sample size of six. One would simply state the raw data.
There were 2 households out of which 50.0% had children under the age of 18 living with them, and 100.0% were married couples living together. The average household size was 3.00 and the average family size was 3.00.
"There were 2 households out of which 50.0% had children under the age of 18 living with them, and 100.0% were married couples living together. The average household size was 3.00 and the average family size was 3.00." From this one can gather that the grandparents (with no children) live in town with their son or daughter (unlikely both) and their two grandchildren.
It gets better. I was telling this story to an individual who happened to be in the location that I am -- purely random. She said that her grandfather grew up in Ransom. "Isn't that by Alexander?" she asked. Incredible. I cannot make this stuff up. She said the town was once bigger. Her grandfather / grandmother had twelve children, and her grandmother was one of eleven children in her family. Yes, I would say that Ransom, at one time, was bigger.
Okay, back to the work at hand. Two wells came off the "tight hole" status as NDIC now refers to it:
- 20205, 859, CLR, Rennerfeldt 1-30H, Williams County (previously reported by the company)
- 20270, 732, Petro-Hunt, Skevsvold 150-101-4B-9-1H, McKenzie County
- 19440, 453, OXY USA, Sunshine 31-16H, Burke County, Bakken
Are They Paying $14,000/Acre For the Three Forks? -- The Bakken, North Dakota, USA
This is going to be a very long post, and it is going to jump all over the place, but if you stick with it, you might get as excited as I am at the moment (this feeling of mania will probably pass as soon as I get back on my meds).
This morning someone plunked down $14,000/acre for oil and gas minerals in southwestern North Dakota. They don't get to $14,000 bidding against themselves. There were at least two folks interested in this play. I wonder how much the winning bidder was willing to go. But I digress.
Why would anyone pay that much for an area of the Williston Basin where the middle Bakkenn formation is thinning out?
The obvious answer is the Three Forks formation where it "pinches out" in this area, and indeed, I do believe the Three Forks is the quick answer that will satisfy most folks. There have been some great TF wells in this area, but nothing to get me overly excited in the sense that it's something new, bigger, and better. There's not much in the immediate area to help me.
But there is a string of old vertical wells, most plugged and abandoned (PNA), lying east of the acreage in question; one is water injected (WI) and the others, as expected, are on a pump (AL).
These wells are all in Bell oil field or Zenith oil field; they are all in a 4 x 1 mile rectangle, lying in four adjacent sections, immediately east of the parcels of land that went for $14,000/acre in today's state auction lease sale.
That does not mean that holds true for the other formations in the Williston Basin. In fact, I think with a) the increase in the price of oil; b) new and improved technology; and, c) the potential for multiple pay zones for a single well; the Williston basin may still hold a few more surprises.
Outside of a very small group of folks, I doubt anyone knows that there are wells like the Ann Planchek well that have produced more than a million barrels of oil and produced for more than 25 years (it has pretty much been off-line since 2008, though it is still considered an active well, last producing oil in July, 2010).
So, would companies pay $14,000 for the Three Forks? Statoil says it paid $8,000/acre for BEXP, mostly in the middle Bakken (personal communication).
Remember the Tyler formation? For now, go to this PDF, and simply look at the map, don't read anything in the small print, just look at the map. That way you will know where the Tyler is in North Dakota. Tell me if you don't see the bull's eye. The bull's eye would be that red center (100 points) surrounded by yellow (50 points), green (20 points), and purple (10 points). The Tyler extends into Montana and South Dakota.
Folks have paid record prices of oil rights in North Dakota where there is a lot of interest in the Tyler formation. That was posted awhile back, click here and here. [The Tyler lies above the Heath.]
From what little I understand about the shale oil business, there are four things that are important to the oil man or the oil woman: a) TOC; b) thickness; c) porosity; d) trapping; and, e) maturity. Okay, five things.
I think "they" have a better word for "trapping" but I'm making this up as I go along and don't want to get off track.
Now, go to this posting to understand a bit more about TOC, especially how the Bakken stacks up against, let's say, Saudi Arabia.
There is much more at that posting, but with regard to TOC:
Okay, remember that link where I said to go to the map to see where the Tyler formation of interest is located in North Dakota. It's right here, again, so you don't have to go back up and look for it.
When you get there, go to the small print in the lower right-hand corner and make it big enough to read. Here are some of the data points:
Wouldn't it be interesting if Leigh Price, the geologist who predicted the Bakken was wrong? That it would be the Tyler formation that would be the BIG one, and not the Bakken?
By the way, where is the Tyler formation bull's eye located: right in the heart of McKenzie County, but it easily extends north into Williams County, and obviously some "islands" and "isthmuses" in the southwest part of the state.
Oh, by the way, the heading for this post was "Are They Paying $14,000/Acre for the Three Forks?" One could ask the same question about the Tyler: "Are They Paying $14,000/Acre for the Tyler?" Maybe, but I don't think so.
So, what do I think they are paying for?
Multi-formation payout.
Folks, it's just beginning. The Bakken is the cake. The Tyler is the frosting.
This morning someone plunked down $14,000/acre for oil and gas minerals in southwestern North Dakota. They don't get to $14,000 bidding against themselves. There were at least two folks interested in this play. I wonder how much the winning bidder was willing to go. But I digress.
Why would anyone pay that much for an area of the Williston Basin where the middle Bakkenn formation is thinning out?
The obvious answer is the Three Forks formation where it "pinches out" in this area, and indeed, I do believe the Three Forks is the quick answer that will satisfy most folks. There have been some great TF wells in this area, but nothing to get me overly excited in the sense that it's something new, bigger, and better. There's not much in the immediate area to help me.
But there is a string of old vertical wells, most plugged and abandoned (PNA), lying east of the acreage in question; one is water injected (WI) and the others, as expected, are on a pump (AL).
These wells are all in Bell oil field or Zenith oil field; they are all in a 4 x 1 mile rectangle, lying in four adjacent sections, immediately east of the parcels of land that went for $14,000/acre in today's state auction lease sale.
- 613, s1954, PNA, R.E.Newton 1, Madison, dry; Heath, cumulative: 6,905
- 10286, s1983, PNA, Newton 2-31, Tyler, cumulative, 1,073
- 9849, s1982, PNA, Newton 1-31, Tyler, cumulative, 409,136
- 9706, s1982, AL, Decker 1-32, Madison, dry; Tyler, t8/82; 5/13 cum 752,044
- 9837, s1982, PNA, Stuss 1-32, Madison, dry, Tyler, cumulative, 84,526
- 9850, s1983, AL, Decker 2-32, Tyler, t3/83; 5/13 cum 460,129
- 10495, s1983, PNA, Bass Buckman State 33-13, Tyler, cumulative 265,996
- 9934, s1982, PNA, Schaff 1, Tyler, cumulative 480,539
- 10356, s1983, PNA, Bass Weiss State 33-42, Tyler, cumulative 108,553
- 10806, s1984, PNA, Privrratsky 2, Heath, cumulative 824 (not a typo)
- 9869,s1982, PNA, Privratsky 1, Heath, cumulative 613,928
- 10752, s1984, AL, Polanchek 8-34, Tyler A, t6/84; 5/13; cum 657,784
- 5442, s1974, WI, Krushensky 16-34, Tyler A, cumulative 288,699
- 10686, s1984, AL, Polanchek 2-35, Tyler A, t5/84; 5/13 cum 120,322
- 8649, s1981, AL (last produced a little, 7/10), Ann Polanchek 1-35, Madison, Dry; Tyler A, t9/81; 5/13 cum 1,162,221
- I should have taken Ann to the prom
- unlike the Bakken, some formations are more "hit or miss" (Heath, e.g.)
- these are all vertical wells
That does not mean that holds true for the other formations in the Williston Basin. In fact, I think with a) the increase in the price of oil; b) new and improved technology; and, c) the potential for multiple pay zones for a single well; the Williston basin may still hold a few more surprises.
Outside of a very small group of folks, I doubt anyone knows that there are wells like the Ann Planchek well that have produced more than a million barrels of oil and produced for more than 25 years (it has pretty much been off-line since 2008, though it is still considered an active well, last producing oil in July, 2010).
So, would companies pay $14,000 for the Three Forks? Statoil says it paid $8,000/acre for BEXP, mostly in the middle Bakken (personal communication).
Remember the Tyler formation? For now, go to this PDF, and simply look at the map, don't read anything in the small print, just look at the map. That way you will know where the Tyler is in North Dakota. Tell me if you don't see the bull's eye. The bull's eye would be that red center (100 points) surrounded by yellow (50 points), green (20 points), and purple (10 points). The Tyler extends into Montana and South Dakota.
Folks have paid record prices of oil rights in North Dakota where there is a lot of interest in the Tyler formation. That was posted awhile back, click here and here. [The Tyler lies above the Heath.]
From what little I understand about the shale oil business, there are four things that are important to the oil man or the oil woman: a) TOC; b) thickness; c) porosity; d) trapping; and, e) maturity. Okay, five things.
I think "they" have a better word for "trapping" but I'm making this up as I go along and don't want to get off track.
- TOC: total organic content -- simply put, the higher the percentage of TOC, the more potential for oil
- Thickness: obviously the thicker the seam, the better. Hopefully I don't have to explain that.
- Porosity: this was something I didn't understand until proppants came along. Now I feel more comfortable with the theory -- the surrounding rock, dirt, whatever, has to have pores in it for the oil to leak to get to the well. Proppants keep those pores open.
- Trapping: another concept I didn't pay attention to until lately. Obviously, the oil needs to stay trapped in a confined area for the well to be productive. If oil was produced in say, the Bakken formation, but then migrated to a different formation over the millenia, the Bakken would not have as much oil as it might otherwise have.
- Maturity: the organic carbon has got to "mature" to oil (pressure, heat, and time).
Now, go to this posting to understand a bit more about TOC, especially how the Bakken stacks up against, let's say, Saudi Arabia.
There is much more at that posting, but with regard to TOC:
There are five areas in the world where "world class" source rock exists:When I first came across this information, I about fell off my chair: the Bakken has a TOC average of 11 percent, compared to Saudi with varying reports of 2 - 5 percent. Wow.
For comparison, TOCs:
- The Bakken
- Norwegian Sea (North) and North Sea
- Venezuela
- Saudi Arabia
- Norwegian Sea (South) and The Netherlands
- Bakken: as high as 11%
- United Arab Emirates: 0.3 to 5.5%
- Saudi Arabia: 2 to 5%
- Trinidad: 2.2%
- North Sea: 5.6%
Okay, remember that link where I said to go to the map to see where the Tyler formation of interest is located in North Dakota. It's right here, again, so you don't have to go back up and look for it.
When you get there, go to the small print in the lower right-hand corner and make it big enough to read. Here are some of the data points:
- Maturity: high electrical resistivity values suggesting it's mostly oil, not water; "rocks are mature and oil saturated"
- Trapping: "abnormally high fluid pressures indicate the Tyler Formation is sealed from communication with surrounding formation and minimal migration has likely occurred for any oil generated within."
- Porosity: doesn't say (unless I missed it); but no longer matters (as much) if there is technology to override low porosity (such as, fracking); although it would be nice if the rock was highly porous
- Thickness: I don't think it's at this link but elsewhere it is stated that the Tyler formation is generally thicker than the Bakken formations and appreciably so (if I find the link, I will link it here). I know I'm right on that because I read it earlier but did not keep the link -- sorry)
- TOC: the higher the TOC, the better. Saudi Arabia average 2 - 5 percent. The middle Bakken averages 11 percent. According to geologists, "a good source rock for generating oil and gas has greater than or equal to 1 one percent weight TOC." The upper most Tyler shale has a TOC of about 10% (similar to the Bakken), while the lower two Tyler shales have a TOC of about 30%. Wow.
Wouldn't it be interesting if Leigh Price, the geologist who predicted the Bakken was wrong? That it would be the Tyler formation that would be the BIG one, and not the Bakken?
By the way, where is the Tyler formation bull's eye located: right in the heart of McKenzie County, but it easily extends north into Williams County, and obviously some "islands" and "isthmuses" in the southwest part of the state.
Oh, by the way, the heading for this post was "Are They Paying $14,000/Acre for the Three Forks?" One could ask the same question about the Tyler: "Are They Paying $14,000/Acre for the Tyler?" Maybe, but I don't think so.
So, what do I think they are paying for?
Multi-formation payout.
Folks, it's just beginning. The Bakken is the cake. The Tyler is the frosting.
EOG Reports 3Q11 -- Wow; MRO Profits Quadruple -- Wow, Wow, Wow -- SM Reports -- The Bakken, North Dakota, USA
EOG today reported third quarter 2011 net income of $540.9 million, or $2.01 per diluted share. This compares to a third quarter 2010 net loss of $70.9 million, or $0.28 per diluted share.
I have not read any more than that, but for now, I.N.C.R.E.D.I.B.L.E.
Okay, now on to Marathon Petroleum:
But Marathon Oil's net fell 42 percent.
And SM reported a great quarter:
I have not read any more than that, but for now, I.N.C.R.E.D.I.B.L.E.
Okay, now on to Marathon Petroleum:
Marathon Petroleum Corp.'s profit quadrupled in the third quarter as its refineries used relatively cheap oil while prices rose for the fuel it sold.
The Findlay, Ohio company, which split from Marathon Oil Corp. earlier this year, on Tuesday reported earnings of $1.13 billion, or $3.16 per share, for the three months ended Sept. 30. That compares with $277 million, or 77 cents per share, for the same part of 2010. Revenue increased 30 percent to $20.65 billion in the quarter.
The results beat analyst forecasts of $2.44 per share on revenue of $18.12 billion, according to FactSet.
But Marathon Oil's net fell 42 percent.
And SM reported a great quarter:
SM Energy reported net income for the third quarter of 2011 of $230.1 million or $3.41 per diluted share. This compares to net income of $15.5 million, or $0.24 per diluted share, for the same period of 2010.
The increase in net income between these two periods is due to higher operating income driven by higher production year over year as well as the recognition in the third quarter of 2011 of a gain on divestiture activity related to the previously announced sale of operated Eagle Ford shale properties and large non-cash gains associated with the Company's commodity derivative program.
Adjusted net income for the third quarter of 2011 was $42.4 million, or $0.63 per diluted share, compared to adjusted net income of $20.0 million, or $0.31 per diluted share, for the same period of 2010. Adjusted net income excludes certain items that the Company believes affect the comparability of operating results.
Speaking of "Rocks": Review of the Brian Williams "Rock" -- The Bakken Rocks, North Dakota, USA
I was just going to leave the information below as it was, in the order that I clicked on it, looking for reviews. But by far, the best site was this one: send pastors. And that's why I listed it first.
One reviewer led off his story with this: what he saw in Williston was incredible.
What happens when the oil runs out was topic of discussion at Straight Dope, and it sounded like dopes writing in. UND's conservative estimate is that the Bakken will take until 2030 to drill and then it will continue to produce until 2100. That's long enough for most of us.
Much better, from EntertainmentWeekly:
Lipstick Alley had Twitter-like comments only. Not worth going there.
Whether a lot of folks watched it or not, it had a diverse and wide audience.
One reviewer led off his story with this: what he saw in Williston was incredible.
What happens when the oil runs out was topic of discussion at Straight Dope, and it sounded like dopes writing in. UND's conservative estimate is that the Bakken will take until 2030 to drill and then it will continue to produce until 2100. That's long enough for most of us.
Much better, from EntertainmentWeekly:
Before Stewart’s live-in-studio segments, Harry Smith presented an eye-opener about Williston, N.D., where an oil boom has led to an abundance of employment — thousands of jobs. So many, that there isn’t enough housing for the influx of workers, some of whom, we were told, form “man-camps” to live in during off-hours.Advertising Age wrote this and a great photo to boot:
The busiest town in America is not in New York, California or anywhere near Madison Avenue, Hollywood or Disney World, but out on the prairie near the geographic center of North America.Daily Motion has the 2.33 video I posted earlier. It was so pleasant to see a positive piece on NBC News -- generally it's about some disaster ... or so I've been told. I do not watch network news any more.
It is Williston, North Dakota, a once-tiny frontier town just south of Canada near the Montana border, where an oil boom fueled by new drilling technology has created an economic anomaly in the otherwise recession-torn nation. While marketers across the country struggle with unemployed consumers, in Williston the problem is not creating jobs, but filling them.
Lipstick Alley had Twitter-like comments only. Not worth going there.
Whether a lot of folks watched it or not, it had a diverse and wide audience.
North Dakota Auction Results -- Lease Sales -- Bonus Paid -- Is $14,000 the New Record? -- The Bakken, North Dakota, USA
Link here.
Results:
Dunn County: successful bids ranged from $800 to $8,500. Most seemed to be in the $2,000/acre range. The $8,500/acre was for two tracts, one for 105 acres and one for 26 acres; Northern Energy.
Billings County: only a dozen parcels, all in T140N-R100W and T139N-R100W, and four tracts were in the same section: 36-139-100. Those tracts went for $2,500/acre, but all the others between $13,000 and $14,000/acre. And this was Billings County. Davis Exploration had the deep pockets. Most parcels were for 80 acres, some for 40 acres.
McKenzie County:successful bids ranged from $4,500 to $9,000; fourteen parcels in all. J Mark Alvord bought 1.48 acres for $9,000/acre, so that explains that -- 15-154-97. Baby Lion Oil & Gas LLC bought 51.55 acres for $4,500/acre. Who wants to start the rumor that Bud Brigham has started a new LLC? If so, it's not Baby Lion; that company is out of Austin, TX, but first time I had heard of it. It turns out it's just me: unknowing (ignorant is too harsh). Baby Lion was successful on some bids at the BLM lease in Billings in July, 2011. They must have some deep pockets, also. At that auction they bought 40 acres paying a bonus of $8,400/acre. Titan Resources is aptly named: paying almost $9,000/acre for two parcels, one with 115 acres and one with almost 160 acres.
Divide, Renville, and Stark had a few parcels, but nothing of note, and nothing in Williams County or Mountrail County.
And I am very, very impressed with how fast they got these results posted.
Results:
Dunn County: successful bids ranged from $800 to $8,500. Most seemed to be in the $2,000/acre range. The $8,500/acre was for two tracts, one for 105 acres and one for 26 acres; Northern Energy.
Billings County: only a dozen parcels, all in T140N-R100W and T139N-R100W, and four tracts were in the same section: 36-139-100. Those tracts went for $2,500/acre, but all the others between $13,000 and $14,000/acre. And this was Billings County. Davis Exploration had the deep pockets. Most parcels were for 80 acres, some for 40 acres.
- 28-140-100, 40 acres; $14,000/acre
- 35-140-100, 80 acres; $13,000/acre
- 22-140-100, 80 acres; $13,000/acre
- 22-140-100, 80 acres; $13,000/acre
- 26-140-100, 80 acres; $13,250/acre
- 27-140-100, 80 acres; $13,000/acre
- 28-140-100, 80 acres; $14,000/acre
McKenzie County:successful bids ranged from $4,500 to $9,000; fourteen parcels in all. J Mark Alvord bought 1.48 acres for $9,000/acre, so that explains that -- 15-154-97. Baby Lion Oil & Gas LLC bought 51.55 acres for $4,500/acre. Who wants to start the rumor that Bud Brigham has started a new LLC? If so, it's not Baby Lion; that company is out of Austin, TX, but first time I had heard of it. It turns out it's just me: unknowing (ignorant is too harsh). Baby Lion was successful on some bids at the BLM lease in Billings in July, 2011. They must have some deep pockets, also. At that auction they bought 40 acres paying a bonus of $8,400/acre. Titan Resources is aptly named: paying almost $9,000/acre for two parcels, one with 115 acres and one with almost 160 acres.
Divide, Renville, and Stark had a few parcels, but nothing of note, and nothing in Williams County or Mountrail County.
And I am very, very impressed with how fast they got these results posted.
North Dakota May Have New Refinery -- The Bakken, North Dakota, USA
Link here.
More than a decade after it was originally proposed, the Three Affiliated Tribes are finally calling for proposals to finance an oil refinery just inside the reservation's boundaries near Makoti.Modular construction could result in first phase being operational by next summer.
If built, it will be the first refinery constructed in North Dakota since the former Mandan Refinery, now the Tesoro Refinery, went into operation in 1954.
The call comes shortly after the Environmental Protection Agency issued a record of decision this summer, approving the tribes' plan to process 15,000 barrels of Bakken crude daily into a variety of petroleum fuels.
The tribes are looking for a financial proposal that will cover an estimated $350 million to $400 million to build the refinery in four modular stages, the first stage with a capacity of 6,000 barrels of oil.
Fracking Concerns -- It's Not Over Yet -- California Experience
Monterey County, California --
Venoco LLC apparently has spent upwards of $10 million to develop some oil and gas leases --
Venoco dropped those plans due to fracking lawsuits:
Anyway, so much for the possibility of California maintaining its number 2 or 3 spot in oil production.
Venoco LLC apparently has spent upwards of $10 million to develop some oil and gas leases --
Venoco dropped those plans due to fracking lawsuits:
An application by a Santa Barbara County company to drill up to nine exploratory oil and gas wells on three parcels off Jolon Road, a couple of miles west of Highway 101 near Bradley, was withdrawn before an appeal could be heard Wednesday by the Monterey County Planning Commission.If I were Venoco, I know how I would play this, but I will keep my thoughts to myself. This is not rocket science.
Venoco LLC told county planners Tuesday it would drop its bid to drill the wells, and the commission merely voted to put the company's decision into the record. Venoco won approval in September 2010 for the exploratory wells in a potentially new field from the county zoning administrator.
Anyway, so much for the possibility of California maintaining its number 2 or 3 spot in oil production.
North Dakota Lease Sales Now Live -- And Now Over -- The Bakken, North Dakota, USA
I was just sent this comment:
Then scroll down to "audio" -- will require RealPlayer on your computer. Audio only available in real time. I will post results when they become available, assuming I don't forget.
More to follow.
9:58 a.m. Tracts in McKenzie now moving ....
First tract, $6,800, river tract, to Petro-Hunt
Second tract, $7,750, river tract, to Petro-Hunt
Third tract,$4,500, to .... Baby Lion Oil and Gas (?) or is it "Babylon"?
Fourth tract,$7,400 to Northern Energy
Fifth tract, $9,000 -- Mark Albert (sp?)
Sixth tract,$8,900, -- to Titan Resources
Future updates will be selective --
Renville County, now --
10:18 a.m. Stark County, now --
... and that's it.
I arrived late, so I did not hear the Billings County portion of the auction, but when they are published, I will post them.
Again, a huge thank you to "anonymous" for alerting me to the live auction.
"You may be interested in tuning in to the state land sale... tracts in Billings County went for $13,100/acre a few minutes ago."For folks interested: http://www.land.nd.gov/minerals/minerals.htm
Then scroll down to "audio" -- will require RealPlayer on your computer. Audio only available in real time. I will post results when they become available, assuming I don't forget.
More to follow.
9:58 a.m. Tracts in McKenzie now moving ....
First tract, $6,800, river tract, to Petro-Hunt
Second tract, $7,750, river tract, to Petro-Hunt
Third tract,$4,500, to .... Baby Lion Oil and Gas (?) or is it "Babylon"?
Fourth tract,$7,400 to Northern Energy
Fifth tract, $9,000 -- Mark Albert (sp?)
Sixth tract,$8,900, -- to Titan Resources
Future updates will be selective --
Renville County, now --
10:18 a.m. Stark County, now --
... and that's it.
I arrived late, so I did not hear the Billings County portion of the auction, but when they are published, I will post them.
Again, a huge thank you to "anonymous" for alerting me to the live auction.
More on the Natural Gas Gathering and Processing Projects in the Bakken -- North Dakota, USA
It's funny how things turn out.
Again (I sound like a broken record), but if natural gas represents only four percent of the total hydrocarbon economic value in the Bakken, can you imagine what this all means?
And when I see "adding a total of 27 MMcf of firm capacity," I can put that into perspective, thanks to someone who has been sending me much information on ONEOK's involvement (see comments at the link above).
- The Bakken is an oil field, not a "gas" field
- I never intended to post much on natural gas
- They say the "natural gas" portion of the Bakken only contributes about 4 percent of the overall hydrocarbon economic value
- The company continues to pursue expansion of facilities and services offered to customers. Energy development within its geographic region, which includes portions of Colorado, Wyoming, Montana and North Dakota, is expanding, most notably the Bakken of North Dakota and eastern Montana. It owns an extensive natural gas pipeline system in the Bakken area. Ongoing energy development is expected to have many direct and indirect benefits to this business.
- Installation of additional compression at the Charbonneau station was completed and placed into service in September, providing additional firm capacity for producers in the Bakken production area. With some additional modifications, this project has the potential of adding a total of 27 MMcf of firm capacity.
- Construction has begun on approximately 12 miles of high pressure transmission pipeline providing takeaway capacity from the Garden Creek processing facility being constructed in northwestern North Dakota. The pipeline project is expected to be completed before year-end.
- Preparations are underway for the construction of approximately 13 miles of high pressure transmission pipeline from the Stateline I and II processing facilities in northwestern North Dakota to deliver gas into the Northern Border Pipeline. The project is expected to be completed by mid 2012.
- The company has three natural gas storage fields including the largest storage field in North America located near Baker, Montana. It continues to seek interest in its storage services and is pursuing a project to increase its firm deliverability from the Baker Storage field by 125 MMcf per day. Commitment on approximately 30 percent of the total potential project has been received. The additional firm deliverability is expected to be available in November.
Again (I sound like a broken record), but if natural gas represents only four percent of the total hydrocarbon economic value in the Bakken, can you imagine what this all means?
And when I see "adding a total of 27 MMcf of firm capacity," I can put that into perspective, thanks to someone who has been sending me much information on ONEOK's involvement (see comments at the link above).
Traffic Counts on 4-Lane Divided Highway West of Williston
Doug sent this to me as a comment; in case folks don't read the comment, it is posted here:
Traffic counts between Williston and the 4-mile corner west of town have gone from 6,000 a day to 26,000 a day.
This was in response to folks noting the traffic shown on the MSNBC / NBC newscasts last night. I assume the 6,000 / day used to be a mix of cars, pickup trucks, RVs, and trucks. I assume the additional 20,000 is all trucks: pickup trucks, semis, specialized trucks, etc. Think of the amount of diesel that is being sold in Williston. And note that there have been no supply interruptions in fuel deliveries, at least as far as I know. I think that is very, very remarkable. We can't get construction supplies to this part of the country, but they can get diesel here.
Traffic counts between Williston and the 4-mile corner west of town have gone from 6,000 a day to 26,000 a day.
This was in response to folks noting the traffic shown on the MSNBC / NBC newscasts last night. I assume the 6,000 / day used to be a mix of cars, pickup trucks, RVs, and trucks. I assume the additional 20,000 is all trucks: pickup trucks, semis, specialized trucks, etc. Think of the amount of diesel that is being sold in Williston. And note that there have been no supply interruptions in fuel deliveries, at least as far as I know. I think that is very, very remarkable. We can't get construction supplies to this part of the country, but they can get diesel here.
Buzz in the Watford City Coffee Shops This Week -- The Bakken, North Dakota, USA
I suspect this will generate some buzz in the Watford City coffee shops this week:
I will write more about this later, if I remember, and if I have time, but folks might be interested in this well:
I chose this well because it is a vertical well nearest the new True well noted above. The Evanson well below has had this type of activity since November, 2001. It has been on line for more than 20 days on only two occasions, October, 2001 (23 days), and November, 2001 (25 days). This well remains flowing on its own; no pump. Flowing on its own since it was spudded in 2001.
To say the least, the oil business is fascinating.
- 20502, 1,272, True, Hagen 23-13H, Red Wing Creek, Madison (not a Bakken)
I will write more about this later, if I remember, and if I have time, but folks might be interested in this well:
- 15121, 500, True, Evanson 21-24, Red Wing Creek, Madison, s5/01; t7/01; cum 8,260 bbls (not a typo)
| MADISON | 9-2011 | 2 | 208 | 412 | 17 | 235 | 0 | 235 |
| MADISON | 8-2011 | 2 | 43 | 203 | 13 | 49 | 0 | 49 |
| MADISON | 7-2011 | 2 | 18 | 0 | 19 | 20 | 0 | 20 |
| MADISON | 6-2011 | 1 | 82 | 0 | 20 | 36 | 0 | 36 |
| MADISON | 5-2011 | 1 | 32 | 0 | 20 | 36 | 0 | 36 |
| MADISON | 4-2011 | 1 | 45 | 0 | 20 | 51 | 0 | 51 |
| MADISON | 3-2011 | 1 | 30 | 0 | 12 | 34 | 0 | 34 |
| MADISON | 2-2011 | 1 | 29 | 0 | 2 | 33 | 0 | 33 |
| MADISON | 1-2011 | 1 | 40 | 0 | 18 | 45 | 0 | 45 |
I chose this well because it is a vertical well nearest the new True well noted above. The Evanson well below has had this type of activity since November, 2001. It has been on line for more than 20 days on only two occasions, October, 2001 (23 days), and November, 2001 (25 days). This well remains flowing on its own; no pump. Flowing on its own since it was spudded in 2001.
To say the least, the oil business is fascinating.
***************
The Hagen well, just reported, is notable for two reasons: it is a horizontal, unlike most True Oil wells in the Red Wing Creek oil field, and it's IP is huge, compared to other True Oil wells, and even by Bakken standards, it's a great IP. I note that I did not post the IP for some of the other Red Wing Creek/True Oil wells in the earlier posting. Here they are for selected wells:- 5235, IP: 400; s1974: 2,829,567 bbls to date
- 5323, IP: 917; s1973: 3,235,019 bbls to date
- 5286, IP: 741; s1974: 2,974,690 bbls to date
- 5335, IP: 642; s1974: 1,064,998 bbls to date
- 5260, IP: 396; s1974: 3,470,983 bbls to date
Reminder for Newbies: Wells Coming Off the Confidential List -- "New Wells Reporting" -- The Bakken, North Dakota, USA
Link here.
When wells come off the confidential list, the NDIC releases the data. That data is what is posted on the "New Wells Reporting." The NDIC has apparently changed its language slightly: recently that portion of the daily activity report has been changed from "released from confidential status" to "released from tight hole status." For most of us the change in language makes very little difference.
Even if the IP is not reported at the end of six months, the well file and the production numbers (if any) are available at the end of the "confidential period" unless the company is granted another period of "tight hole" status which I have seen very, very rarely, and it did not occur immediately after the six month period. I noted it when the NDIC report said, "back on tight hole status" or something to that effect.
Due to the fracking backlog, a number of wells will not report an IP but are placed on DRL status while waiting to be completed.
When those wells are completed, the NDIC provides an update. I go back on an irregularly irregular basis and update the DRL data to the IP.
Occasionally I will add to the "new wells reporting," information that is released by a driller in a quarterly report or a press release, although I am doing that less frequently.
When wells come off the confidential list, the NDIC releases the data. That data is what is posted on the "New Wells Reporting." The NDIC has apparently changed its language slightly: recently that portion of the daily activity report has been changed from "released from confidential status" to "released from tight hole status." For most of us the change in language makes very little difference.
Even if the IP is not reported at the end of six months, the well file and the production numbers (if any) are available at the end of the "confidential period" unless the company is granted another period of "tight hole" status which I have seen very, very rarely, and it did not occur immediately after the six month period. I noted it when the NDIC report said, "back on tight hole status" or something to that effect.
Due to the fracking backlog, a number of wells will not report an IP but are placed on DRL status while waiting to be completed.
When those wells are completed, the NDIC provides an update. I go back on an irregularly irregular basis and update the DRL data to the IP.
Occasionally I will add to the "new wells reporting," information that is released by a driller in a quarterly report or a press release, although I am doing that less frequently.
Williston Wal-Mart -- The Bakken, North Dakota, USA
I continue to get an occasional comment about the Wal-Mart in Williston. And, of course, this editorial at the link about Wal-Mart.
Home of Economy remains my favorite store for work clothing, winter clothing, boots, etc., but folks suggesting that the Williston Wal-Mart looks like something from post-hurricane Katrina must be visiting a Wal-Mart on a different planet.
I was just there two days ago, and again to pick up an item that was turned into "lost and found." I was amazed with two things: a) the number of shoppers there (of course, it was payday weekend); and, b) how well stocked the store was.
The store was very, very clean (it will be a problem keeping the store so clean come winter, snow, dirt, mud); nothing was strewn on the floor. I couldn't find a sales person to help me locate what I was looking for, but I walked back to the greeter, and she knew exactly where the item was located. Stores are all different, and one needs to learn how to navigate different stores.
I am absolutely convinced that without Wal-Mart here, the other stores in town could not survive the volume. It would be bedlam. [From wiki: London hospital first to specialize in the mentally ill and origin of the word "bedlam" describing chaos or madness].
Wal-Mart looked fine; the shelves were very well stocked. My hunch is that Sam's computerized inventory system has this figured out. I'm sure the system programmers were called into check the numbers coming back at the beginning of the boom, but when verified, the company started rolling an army of semis to the Williston Wal-Mart with inventory. There is a huge sign outside Wal-Mart looking for overnight stockers -- I think that's a new sign. I may apply. The middle of the night is a quiet time for me.
I don't know how the local Wal-Mart is handling its national policy allowing trucks and RVs to camp out in the parking lot. There are RV's there, and I believe they have a special location for such but however they are doing it, it seems to be working. Did you catch that segment on MSNBC about the gentleman living in the Wal-Mart parking lot? He had just arrived; he kept his washed/clean laundry on the left side of his car's trunk and the dirty clothes on the right. He had a ziplock bag for toothbrush and toiletries. Jobless but coming to Williston to find a job. At the end of the video, a follow-up tells us that he has found a job. I hope he is able to find a place to stay other than the Wal-Mart parking lot, but you have to commend a national company for doing that -- allowing folks at least a temporary place to stay. Obviously with their huge parking lot, they are one of the few that could handle that. It's amazing how little some folks can get by on for a short period of time. Makes one think.
Again, as I noted in the earlier posting. I may be in the minority but I prefer a very, very busy chaotic Wal-Mart due to a boom (the only boom in the US right now) as opposed to a very, very busy chaotic Wal-Mart due to a hurricane Katrina, but maybe that's just me.
Oh, the lines at Wal-Mart. Give me a break. One can spend 90 minutes filling two grocery carts with inventory and then stand in line for maybe ten minutes (though it feels like an eternity) to pay reasonable prices for great stuff. By the way, bring a book. It's amazing how fast ten minutes goes by when reading a book.
Home of Economy remains my favorite store for work clothing, winter clothing, boots, etc., but folks suggesting that the Williston Wal-Mart looks like something from post-hurricane Katrina must be visiting a Wal-Mart on a different planet.
I was just there two days ago, and again to pick up an item that was turned into "lost and found." I was amazed with two things: a) the number of shoppers there (of course, it was payday weekend); and, b) how well stocked the store was.
The store was very, very clean (it will be a problem keeping the store so clean come winter, snow, dirt, mud); nothing was strewn on the floor. I couldn't find a sales person to help me locate what I was looking for, but I walked back to the greeter, and she knew exactly where the item was located. Stores are all different, and one needs to learn how to navigate different stores.
I am absolutely convinced that without Wal-Mart here, the other stores in town could not survive the volume. It would be bedlam. [From wiki: London hospital first to specialize in the mentally ill and origin of the word "bedlam" describing chaos or madness].
Wal-Mart looked fine; the shelves were very well stocked. My hunch is that Sam's computerized inventory system has this figured out. I'm sure the system programmers were called into check the numbers coming back at the beginning of the boom, but when verified, the company started rolling an army of semis to the Williston Wal-Mart with inventory. There is a huge sign outside Wal-Mart looking for overnight stockers -- I think that's a new sign. I may apply. The middle of the night is a quiet time for me.
I don't know how the local Wal-Mart is handling its national policy allowing trucks and RVs to camp out in the parking lot. There are RV's there, and I believe they have a special location for such but however they are doing it, it seems to be working. Did you catch that segment on MSNBC about the gentleman living in the Wal-Mart parking lot? He had just arrived; he kept his washed/clean laundry on the left side of his car's trunk and the dirty clothes on the right. He had a ziplock bag for toothbrush and toiletries. Jobless but coming to Williston to find a job. At the end of the video, a follow-up tells us that he has found a job. I hope he is able to find a place to stay other than the Wal-Mart parking lot, but you have to commend a national company for doing that -- allowing folks at least a temporary place to stay. Obviously with their huge parking lot, they are one of the few that could handle that. It's amazing how little some folks can get by on for a short period of time. Makes one think.
Again, as I noted in the earlier posting. I may be in the minority but I prefer a very, very busy chaotic Wal-Mart due to a boom (the only boom in the US right now) as opposed to a very, very busy chaotic Wal-Mart due to a hurricane Katrina, but maybe that's just me.
Oh, the lines at Wal-Mart. Give me a break. One can spend 90 minutes filling two grocery carts with inventory and then stand in line for maybe ten minutes (though it feels like an eternity) to pay reasonable prices for great stuff. By the way, bring a book. It's amazing how fast ten minutes goes by when reading a book.
BHI and MDU report earnings -- The Bakken, North Dakota, USA
Baker Hughes misses by $0.02, reports revs in-line; Baker Hughes misses by $0.02, reports revs in-line.
MDU Resources Group, Inc. (NYSE:MDU) today reported third quarter consolidated earnings of $63.8 million, or 34 cents per common share, compared with $60.8 million, or 32 cents per common share for the third quarter of 2010.
MDU Resources Group, Inc. (NYSE:MDU) today reported third quarter consolidated earnings of $63.8 million, or 34 cents per common share, compared with $60.8 million, or 32 cents per common share for the third quarter of 2010.