Friday, March 16, 2012

Six (6 ) New Permits -- The Williston Basin, North Dakota, USA

Daily activity report, March 16, 2012 --

Operators: OXY USA, Whiting, Hess, Oasis, Gadeco, CLR

Fields: Dimond, Bell, Rainbow, Gros Ventre, Epping, Westberg

Seven (7) wells came off the "confidential list." Four were completed, including,
  • 21399, 55, Hess, BL-Davidson-156-9603526H-2, Williams
Nine wells on DRL status reported an IP, includding,
  • 19940, 1,196, XTO, FBIR Yellowwolf 21X-10, Dunn,
  • 19959, 1,572, XTO, Walton 43X-19, McKenzie,
  • 21153, 2,466, BEXP, Abelmann State 21-16 2H, McKenzie
Twelve wells reported that they were producing or plugged, including two more G3 Operating wells.

Murex reported a re-entered well as a producer:
  • 9446, Murex, Reistad 1-1R, Divide.
Five permits were canceled, including Zavanna's Serval in Williams County, and two Whiting TF wells in Billings County.

For Investors Only -- Obama, Saudis, and Spiking Oil Prices -- Boston Apple Store iPad Update -- Absolutely Nothing To Do With The Bakken


May 5, 2013: US imports of Saudi Arabia have come down significantly.

March 17, 2012: So, the update on the Boston Apple store and the iPad. Taking public transportation I got to the Apple store, downtown Boston (Boylston Street) about 8:00 p.m. No line, but I had to wait a few minutes to touch the iPad; the table of eight (8) store units was surrounded by a score of folks. Yes, it was amazing. I was there for the entire hour, before they told us the store was closed (9:00 p.m.) and would open in the morrow at 8:00 a.m. It seemed to load faster, but hard to say. I honestly didn't expect "retinal resolution" to be all that great, but I was surprised. It was outstanding.

Today's Boston Globe data points:
  • 8:00 a.m., launch day: 200 people in line; a small line until 5:00 a.m. when it "exploded"
  • the line stretched around the corner up the next street (the Apple store sits in the middle of the block, directly across the street from the Prudential Center, food court entrance, Boylston Street)
  • by 8:30 a.m., the line was gone; everyone able to get into the store (it's a three-floor store; a huge store)
  • dictation app is exception; can take eight dictated sentences in one take -- transcribed in under a second, the Siri app
March 17, 2012: Don found the site for the government data referenced in the post below. It is:

Note, when you click on that URL, you may get a warning that the site is formatted in a strange way and could have viruses. I took the chance, clicked on it, and found it to be a US government site, an Energy Information Agency Site. Go figure.

The data is current through December, 2011, and there is minimal evidence that Saudi imports have increased. Comparing the numbers from the first six months of 2011 with the last six months of 2011, yes, Saudi imports have increased 20% but nothing to the degree suggested in the story below.

I assume Reuters in the story below has their facts straight; if so, Reuters has access to data for the months of January and February. It will be interesting to track the official US data over the next few months. If I forget to do that, someone remind me.

Original Post

I might come back to this story later, but I have to run. I want to see what is going on at the Apple store in downtown Boston before it closes this evening.

But this Reuters story is very, very interesting.
Saudi Arabia is preparing to extend this year's unexpected jump in oil sales to the United States, adding to speculation about the response of the world's top oil exporter to sanctions against Iran and a rally in prices.

The kingdom's shipments to the United States have quietly risen 25 percent to the highest level since mid-2008, according to preliminary U.S. government data, a sizeable leap that appears at least partly related to the imminent completion of a major expansion at its joint-venture Motiva refinery in Texas.
Go to the link. I thought our "dependence" on mideast oil had been dropping, but now we learn that Saudi's shipments of crude to the US have quietly risen 25 percent to the highest level since mid-2008. Hmmm....Keystone XL shut down....Saudi oil and Canadian oil competing for same end-users? And we opted for Saudi? Shut off Canada?

Remember, Saudi's oil is heavy, like....drum roll... Canada's.

Something is being choreographed, folks.

The on-again, off-again news that Obama was going to release oil from the SPR provided a nice benchmark for the administration, regardless of the accuracy/origin of the initial story. 

Go to the link. Huge amount of information for investors. Huge opportunities.

Hey, by the way, did folks notice the significant move up for EOG today, BEFORE the price of oil spiked $2.00? The price of WTI was essentially flat the entire day, until mid-afternoon. Sometime earlier, I was surprised to see EOG moving up quickly -- the price of oil was essentially flat before EOG started going up. Then, oil spiked. KOG was flat to down most of the day, but by the end of the day was up almost 3 percent, AFTER the surge in the price of oil. And KOG has a P/E of 545.  OAS started moving about 12:30 p.m. KOG moved in the last hour. EOG shot up about 12:15 p.m.

Simply idle rambling, waiting for the daily activity report. This is not an investment site. No recommendations are being made with regard to any buying or selling securities. See disclaimer at the sidebar at the right.

Private Oil and Gas Industry Marches On -- Fuel of the Past -- Absolutely Nothing To Do With The Bakken

Link here.
Southwestern Pennsylvania is set to gain a major economic boost from the construction of a new petrochemical refinery. Shell Oil Co. will announce today that a site near Monaca has been chosen for the multi-million-dollar ethane cracker.

Ohio, West Virginia and Pennsylvania had all sought the plant and offered Shell major tax incentives. Monaca is just 20 miles from both the Ohio and West Virginia borders, so workers in all three states are likely to benefit.
Go to the link to see who will announce the new project. Something tells me these states are not going to let the EPA ban fracking. Especially when EPA's first reports from Pennsylvania suggest that fracking is not harming the drinking water. Is this all being choreographed? The timing is very, very interesting.

After methane, ethane is the second-largest component of natural gas. Ethane is the initial building block of vinyl chloride, then polyvinylchloride, PVC. Polyvinyl chloride, commonly abbreviated PVC is the third-most widely-produced plastic, after polyethylene and polypropylene.  PVC is widely used in construction because it is durable, cheap, and easily worked. PVC production is expected to exceed 40 million tonnes by 2016. [Wiki]

The implications of all that is currently going on in the domestic energy program are absolutely incredible.

NPR Retracts Story on Apple/Chinese Working Conditions -- Absolutely Nothing To Do With The Bakken

NPR retracts the ENTIRE story

Thank goodness for free flow of information on the internet. Before the internet, before Drudge, the original, incorrect, fabricated story would have "gone viral" in the mainstream media. It is notable that this all happened on another big day in Apple's' history: launch of the new iPad.
The show will air an explanation on Sunday, claiming that the episode's narrator, Mike Daisey, misled the show during the fact-checking process, according to Silicon Alley Insider.
Misled? Sounds like they didn't do their own fact-checking.


California Fracking With Little Oversight -- OMG

Link here.
Energy companies across California are injecting a mysterious mix of chemicals into the ground to tap oil deposits while frustrating attempts to regulate the controversial process, known as hydraulic fracturing.

The procedure has drawn the greatest attention in the Rocky Mountain West and Northeast, where states have debated moratoriums to develop regulations after toxic chemicals were found in nearby drinking water. But a quieter battle is being waged in the Golden State, which could be a candidate for increased "fracking" because of its unique geology. Last year, the energy industry scuttled a bill that would have enlisted California in the growing ranks of states that require companies to disclose what they put into the ground. At least nine states have such guidelines.
"... a mysterious mix of chemicals..." ... hydrogen dioxide.....just to name one.

Shocked. I am shocked.

And it gets worse: the "huge" photo at the top of the story about fracking in California was not taken in California. It was taken near Dimock, Pennsylvania, where just hours ago it was reported that the EPA found no health concerns with fracking near the town of Dimock.  One would think that with 49,000 active wells in California, the LA Times could have taken a photo of at least one California well (compare with 6,600 active wells in Northa Dakota). North Dakota now produces more oil with those relatively few wells than California.

Also, note how the LA Times spells "fracking."

So Much For Demand Destruction for Gasoline

Gasoline demand increased in February.
US oil demand fell by 2.3% in February to average 18.4 million b/d compared with February 2011, according to the latest monthly statistical report from the American Petroleum Institute. The decline was led by a drop in demand for residual fuel oil, which was down 40% from a year earlier to 375,000 b/d as users switched to natural gas. [Global warming saving money for homeowners.]

Deliveries of gasoline were up 0.9% to 8.7 million b/d, the first increase in gasoline demand since February 2011.

Did They Not Know This?

CNBC seems to be dropping the ball in helping investors figure out the impact of sanctions on Iran.

First, CNBC was late in reporting, in general, that the effects of the Iranian sanctions scheduled for July 1, 2012, would be felt sooner. It turns out, much sooner. (Actually, I don't think CNBC ever reported on this or commented on this, even after the fact.)

Second, they reported after it happened, that insurers were no longer insuring ocean-going tankers carrying oil from Iran. This was January 23, 2012, if I recall. That was when oil first spiked due to sanctions on Iran. Most of us, I assume, were expecting this spike to occur later this spring/summer. I blogged on that earlier.

Now, third, today, we learn, just as the market is closing, with Brent/WTI surging, that Iran will no longer be able to use electronic payment system starting tomorrow. When did CNBC know this? When did "speculators" know this? I follow the news pretty closely, and this was the first I heard of it.

This is March 16, 2012. The sanctions go into effect July 1, 2012. What other "things" (already on the Iranian sanctions calendar ) are scheduled to  happen between now and then that will affect the price of oil? My hunch is that the "speculators" know these calendar events.


Can they stop trucking in water for flushing toilets?


December 26, 2012: in passing,
In August, 2012, court documents showed that residents of a northeastern Pennsylvania town who say their well water was poisoned by a gas driller agreed to a confidential settlement with Houston-based Cabot Oil & Gas Corp. Soon afterward, the Department of Environmental Protection said Cabot had met its obligations under a 2010 consent agreement and will be permitted to put seven previously drilled wells in Dimock Township back in production. That's a rural area in northeastern Pennsylvania.
September 15, 2012: And New Yorkers, who have never seen an oil well in the Bakken, are complaining about fracking. It looks like they got bigger problems closer to home. Google 70-foot sink hole over sewer in Brooklyn. August 23, 2012:  Pennsylvania says oil company can now go back to work on Dimock area wells.

July 26, 2012: I spoke too soon. Now ALL the tests are done. -- EPA.  I guess the Dimockians weren't happy with "final" results, complained enough, and EPA went back in, this time testing for naturally occurring metals.

May 14, 2012: Final set of tests "clean." Case closed.  

April 10, 2012: Second set of tests from Dimock are also "clean" -- EPA.

Original Post
Initial results from samples of the first 11 of 60 water wells in Dimock, Pennsylvania, did not show contamination levels that could present a health concern, the US Environmental Protection Agency’s Region 3 office in Philadelphia said on Mar. 15. Samples from 6 of the 11 wells showed the presence of methane, sodium, chromium, or bacteria, but in concentrations within the range for safe drinking water, it said.
Houston independent Cabot Oil & Gas Corp., which operates several natural gas wells in the area, said in a statement that it was pleased EPA’s data confirmed earlier findings that Dimock well water meets all regulatory standards.
Link here.

Do you remember this story? This was first posted back in January when the EPA was trucking water into Dimock, to flush toilets over fears of health concerns.

Slow Rolling the Domestic Oil and Gas Industry

This is being posted solely for archival purposes.

Talking heads on CNBC keep asking for evidence that administration is slow-rolling the oil and gas industry.

At least seven governors agree.
Governors from seven US coastal states urged US President Barack Obama to accelerate the pace and level of Gulf of Mexico and Alaska offshore exploration and production permitting; expand access to new offshore areas for traditional and renewable energy development; implement federal revenue-sharing for all states that host development off their shores; and expand assessments of offshore resources, particularly in areas currently not available for leasing.
'Nuf said.

Staggering Data Coming Out of Japan -- With Regard to Oil

All but two of Japan’s 54 atomic reactors remain idle
Japan returns to the fuel of the past

Back to the Future


March 26, 2012: Next-to-last reactor taken off-line for maintenance. Now only one of 54 reactors still on-line in Japan. 

Original Post

Link here to
The influence of demand is particularly important in some niches of the oil market, such as medium-heavy sweet crude. Japanese utilities are buying that variety of crude and burning it directly, without first refining it, at oil-fired power plants to fill the gap left by the loss of nuclear power. All but two of Japan’s 54 atomic reactors remain idle, reducing nuclear electricity generation by roughly 90 per cent. 
I don't know about you, but when a country like Japan shuts down 52 of 54 nuclear reactors -- that gets my attention.

Ninety (90) percent of their nuclear electricity is gone. Gone. 

One can stay with the president and algae, or one can go with the flat-earthers and Harold Hamm.

Algae will have its day, but not in my investing lifetime.

I am proud to be a presidential flat-earther, a PFE. What a great country. Good luck to all.


Oh, I forgot. Japan moving back to coal and oil, the fuel of the past. A great time to take another look at the Kyoto Protocol.
The Protocol was initially adopted on 11 December 1997 in Kyoto, Japan, and entered into force on 16 February 2005. As of September 2011, 191 states have signed and ratified the protocol.The only remaining signatory not to have ratified the protocol is the United States. Other United Nations member states which did not ratify the protocol are Afghanistan, Andorra and South Sudan. In December 2011, Canada denounced the Protocol.
Irony. My hunch is that Japan will not denounce the Kyoto Protocol. It will simply be ignored.

Reminder: Other Sites Out There -- Websites --A Good Site for Those Looking for Jobs in the North Dakota Oil Patch

It's been a long time since I visited this website (""). Either it's improved a lot or I simply forgot about it.

For folks looking for jobs, this appears to be one of the better sites. It's a very nice looking site; well-organized; appears to be quite comprehensive.

Fracturing Off-Shore; Frack Water Re-Cycling in Canadian Oil Sands

Fracturing off-shore: proppants?

Frack water re-cycling coming to Canadian oil sands: to use recently-announced GE technology.