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Sunday, March 18, 2012

Random Update on the Bakken -- The Numbers Are Staggering

Play the video while reading some staggering numbers below the video:


North Dakota Bakken Gravel Hauling
The narrative in the video, by the way, may explain why that truck driver was "unable to make it in the Bakken" which was reported about a week ago.

Some interesting data points sent to me by a reader who attended the recent Bakken conference.

Some time last year, it was reported that $1.5 - $2 billion was being poured into western North Dakota, and I've been using that figure for quite some time. Then a few days (weeks?) ago I noted: 200 rigs  --> 200 wells/month x $10 million/well --> $2 billion just for drilling and completing wells. What about all the rest: pipelines, railroads, housing developments, support services, etc?

It turns out that the new number if $4 billion/month. That makes more sense. Think about it. $4 billion/month being poured into four counties in western North Dakota -- Williams, Dunn, Mountrail, and McKenzie, and I wager that Williams and McKenzie are getting the bulk of it.

The industrial park for the Bakken is located 18 miles east of Montana, just north of the Missouri River. It used to be a town called Williston. It's now known as "whoop" as in WOIP -- Williston Oil Industrial Park.

The activity is moving to the heart of the Bakken: northeast McKenzie County. Takeaway capacity turns out to be the chokepoint in the Bakken; maybe more about this later: what it means. What it says about the Bakken.

Other news from the conference: Halliburton had -- repeat, had -- 7,000 job openings last autumn. Apparently that number has jumped to 11,000. I wager half of them will be needed in McKenzie County where the action is headed this summer.

Enbridge has job openings for 135 folks right now; will go to 200 job openings this spring. Enbridge is now doubling the size of their CBR facility at Berthold; it was built last year.

Details sketchy, but apparently a 3,200-acre intermodal railroad facility planned for Minot. It would result in 45 miles of new track. 

A Note to My Granddaughters

My hunch is that when you reach my age, some fifty years from now, you won't recall what a newspaper was. I know you have no idea what a rotary dial telephone is. You have not even heard of the IBM Selectric. I'll let you guess (no it's the name Starbucks coffee). When you are sixty years old, it will be Siri, apps, e-books, and used books.

And used books. 

I often say I would like to be in the Bakken, but when I'm in Boston, I think I prefer to remain here. For now, I want to be wherever you are. But in the bigger scheme of things, I no longer have a preference where I am as long as I have my library. (When I was in my young 20's, I had no preference where I was, as long as I was with my woman friend. She never wanted to be known as a "girl" friend.) But I digress.

Among the books I am reading now, I am particularly enjoying The Diary of H. L. Mencken, edited by Charles A Fecher, c. 1989. I picked up my used copy for $10 at a used book bookstore in Gloucester, Cape Ann, Massachusetts.

Almost every entry is a delight. This one caught my attention this morning:
The enormous proliferation of government agencies has laid so heavy a burden on journalism that it has imply broken down. It is quite impossible for any newspaper, however large, to report the endless proceedings that go on every day.

The National Labor Relations Board alone is sometimes carrying on fifty or sixty at one time -- not all of them, of course, in Washington, but scattered through the country. The newspapers, at the beginning of this riot, tried to cover the principal cases, but they soon found it impossible, and today they only attempt to cover a salient few. It is the same in many other directions.

The Washington correspondents now find it completely impossible to cover the departments -- indeed, they find it almost impossible to cover Congress, what with its endless committees of investigations. When one committee is on the front page, the others are forgotten, though meanwhile they may be carrying on very important work. In brief, the public can no longer find out what is going on. Measures of the first importance are undertaken without any preliminary discussion, and executed without any rational criticism.

Thus the power of the bureaucracy increases constantly, and no scheme to check it seems to be workable. What the end is to be God knows. At the moment, it is certainly plain that government has got out of hand, and that all the old devices for regulating it are hopeless.
And that was written on May 11, 1940.

When you are reading this in 2062, send me an intersteller, after-life, 4th-dimension GPS, tweet to @papaneartheorionbelt and let me know if Apple still has two percent of the desktop market. It will have 99% of the mobile entertainment device (MED) market.

11 comments:

  1. In Paul Krugman's Saturday column he said he started laughing when he saw The Wall Street Journal use ND as a model for job creation. He then went on to claim that the oil and gas industry has created only "a few thousand jobs" in ND. I guess if your a Nobel Laureate you do not have to use facts.

    ReplyDelete
    Replies
    1. Wow, what a great link. I can only assume when Krugman starts talking at any conference, folks use the opportunity to take a bathroom/refreshment break.

      What a great link.

      My response: http://milliondollarway.blogspot.com/2012/03/nyt-just-another-600-blog-everything-to.html

      Thank you for taking time to comment.

      Delete
  2. Lets see Stephen Chu of DOE fame and Paul Krugman are Nobel prize winners, laureates as the elite call them, and assume the poor commoner can not get along without their superior intelligent.

    In reality these two are resentful of the producers in society and they are left with devising scrams to extract that wealth through force to advance their pathetic selves and their followers.

    They have produced nothing except silly babel, that is destructive in the long run.

    ReplyDelete
    Replies
    1. When Krugman actually starts getting personal with North Dakota ("I had to laugh), it tells me this whole oil success story is getting inside his head (as Gingrich says).

      My hunch is that Krugman a) missed the opportunity to invest in Apple, as I did; and, b) missed investing in the Bakken, and it's killing him to no end.

      The neat thing, his students at Harvard are smarter than he is; and, he has lost all credibility. And that's why the NYT is struggling financially. The seed crop of new readers (his students) are blowing him off.

      Delete
    2. Nice to know that some students have the ability of discernment and are not all lemmings believing everything the authority figures say.

      bakkenblog.com has a cool link to a oil drilling video.

      http://www.youtube.com/watch?feature=player_embedded&v=FDuPZwPPugc

      Delete
    3. I can't remember if it was the "bakkenblog" but I remember posting recently that one of the other Bakken sites had improved significantly; it might have been the "bakkenblog."

      I attended several Harvard Business School lectures during my stay in Boston these past two years, and I quickly saw that the students did not suffer any fools. They would be able to see through Krugman in a NY second.

      No love lost between New York and Boston.

      Delete
  3. If Krugman ever vists ND, someone remind him to close the gate when he leaves.......(sarcasm)

    ReplyDelete
    Replies
    1. I can almost guess the regional newspaper that would invite him out....

      Delete
  4. Speaking of investing in the Bakken. I enjoyed some of your videos I found on line where you were driving around Williston in some of the new residential neighborhoods being developed. One was Harvest Hills...nothing but dirt roads at the time. The link below is an update from the Granite Peak Development site. Phase ONE of the project appears to be pretty much sold out, so am guessing they will be breaking ground on the next phase. This one that has sold out is supposed to have close to 2,000 units including single, duplex, condo and apartments.

    http://www.granitepeakdev.com/downloads/Harvest%20Hills%20Sold%20Plat.pdf

    ReplyDelete
    Replies
    1. Wow, that is really something.

      I sure wish I was back in the Bakken so I could provide video for my readers. It's interesting, I don't need to see it so much but I really wish my readers could see it. I guess my imagination keeps me satisfied.

      It is really exciting to look at that PDF/link and see all the "SOLD"s. Really, really amazing.

      Thank you for taking time to send me the link/comment.

      Delete
    2. For folks looking for more on Harvest Hills subdivision:

      http://milliondollarway.blogspot.com/2011/09/building-begins-for-new-270-unit.html

      and/or go to the bottom of the blog and look for "Harvest Hills...." tags.

      Delete

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