Via CarpeDiem, Milton Friedman responds: "Einstein didn’t construct his theory under order from a bureaucrat. Henry Ford didn’t revolutionize the automobile industry that way. In the only cases in which the masses have escaped from the kind of grinding poverty you’re talking about, the only cases in recorded history, are where they have had capitalism and largely free trade." Amen.
And more: Gibson guitars. Via, again, CarpeDiem.
Time for a new poll.
Last poll: overwhelmingly, 75% of folks feel 1280-acre spacing is the preferred spacing (to 2560-acre spacing) in the Bakken for mineral owners. Comment: I disagree, but the reasoning is not intuitive, but will become clear over the next twenty years.
**********************
Have a great weekend.
Carpe Diem's fact of the day: at the end of May, 336 North Dakota Bakken wells were sitting idle, waiting for frack crews. The government needs to build some more frack spreads. Fast.
The Director's Cut, July 18, 2012
Production
- May, 2012, oil: 639,277 bopd (new all-time high)
- April, 2012, oil: 609,503 bopd
- May, 2012: 7,188 (new all-time high)
- April, 2012: 7,036
- Remember: each new well represents a new $10 million business
- May, 2012: 180
- April, 2012: 167
- May, 2012: $79
- April, 2012: $78
- June: 213
- May: 211
- Apr: 209
The director reminds us the draft BLM regulations have been published in the Federal Register.
Crude oil takeaway via pipeline is almost 35% below production; rail and truck is adequate to make up the difference. This is a new data point. WTI-NYMEX-Bakken spread affected by bottle neck at Cushing.
Drilling permit activity has increased but well below record levels. As winter apporaches more permits will be needed to ensure locations can be built before the weather window closes.
More natural gas gathering systems and natural gas plants may be needed to keep up with the amount of natural gas being produced in the Bakken. Flaring is still high at 31% but well below the historic high of 36% in September, 2011.
