Thursday, March 22, 2012

Williston Area Jobless Rate: Unemployment Rate is 0.8%

Lowest in the nation; perhaps the lowest in North Dakota ever.

If there are 30,000 people in the Williston area, 0.8% means 240 folks in the Williston area are looking for a job but cannot find one.

When you go to the link, read the comments. Sad.

Williston Basin Bakken Update in Montana -- Williston Basin, Montana, USA


October 22, 2013: for Montana updates, see the "Montana" label at the bottom of the blog.

January 15, 2013: update at Fairfield Sun Times

December 19, 2012: two new stories sent in my a reader --
Original Post

A reader sent me this link, saying that column appears in the Great Falls Tribune on a weekly basis, Thursdays. [Note: I don't know how dependable this link is; it has broken in the past; if it breaks, try goolging "Great Falls Tribune oil roundup."

For example:
In Richland County, six horizontal wells were approved. They are Fidelity Exploration's Larson 21-16H (SE SW 21-21N-57E), with a PBHL of 20,179 feet, hitting the Three Forks Formation and XTO Energy's Headington 43X-25B (NE SE 25-26N-52E), with a PBHL at 18,750 feet, shooting for the Bakken Formation. Whiting Oil and Gas Corporation won approval for two Richland County wells, the Mahlen 24-32H (SE SW 32-26N-57E), with a PBHL of 20,217 feet, into the Bakken Formation, and the Double Bar M 24-32H (SE SW 32-27N-57E), with a PBHL at 20,074 feet, aiming for the Bakken layer.
I don't have time, unfortunately to follow Montana oil activity on a regular basis, but this might be helpful to those trying to find information.

Good luck to all and a big "thank you" to Kevin for sending me this link.

North Dakota Names New State Position: Energy Impact Coordinator

Should have been done long time ago.

If there was an article with the headline/photo I did not see it.

Underneath the photo there was a headline announcing new weight restrictions in North Dakota. Looking at the photo, I thought it was Michelle Obama's new national diet plan, and then realized these were two different stories, and that the weight restrictions had to do with state highways and not public officials.

Ten (10) New Permits -- Important Report Today -- The Williston Basin, North Dakota, USA


Later: After posting the original note below, more comments came in regarding Chesapeake. The comment regarding payzones in addition to the Three Forks was most interesting.  Just three miles to the west of the Chesapeake location currently (3/12) with a rig on site, is a small irregular oil field, Rocky Ridge. Here are a few wells from that oil field. All vertical wells.
  • 1484, DRY, Tyler; s8/57
  • 1777, DRY, Tyler; s3/58
  • 2923, 240, Heath, now abandoned; s5/61; t7/61; cum 352K
  • 2955, 126, Heath, now abandoned; cum 17K
  • 4063, 120, Heath, now abandoned; s4/66; t7/66;  cum 312K
  • 4789, 488, Heath, now abandoned; s9/69; t11/69; cum 257K
  • 4892, 197, Heath, now abandoned; s2/70; t6/70; cum 250K
  • 8503, 176 cumulative bbls over first few months; abandoned
Original Post

I noted that this is a more significant report than usual. See if you see what I see.

Daily activity report, March 22, 2012 --

Operators: BEXP (2), Whiting (2), Murex, WPX, Chesapeake, Oasis, Hess, SM Energy

Fields: Spotted Horn, Last Chance, Gros Ventre, Big Stick, Hawkeye, Stanley, Squaw Gap

Chesapeake has a wildcat in Stark County:
  • 22630, loc, Chesapeake, Burwick 17-137-98 A 1H, wildcat; Stark County;
Four (4) wells released from "tight hole" status, including this one:
  • 20191, 1,463, Whiting, Littlefield 41-12XH, Mountrail, Bakken,
One of the four wells was not yet completed/fracked.

This is what I saw. If you've been following the comments, you will notice that some folks feel very, very strongly that Chesapeake is getting ready to make a move in the Williston Basin again. I have said that the tea leaves suggest something else. I left unsaid that I had not seen a new Chesapeake permit in some time. Well, today, Chesapeake has a new permit. A sign of life.

This new Chesapeake location (#22630,  Burwick) is about six miles due west of another Chesapeake wildcat location:
  • 22004, loc, Jilek 8-137-97 A 1H, wildcat, Stark County;
Both these wells are about 6 miles, and 12 miles, east of another Chesapeake wildcat, which currently (3/12) has a rig on site:
  • 22223, drl, Chesapeake, Hutzebiler 9-137-99 A 1H, wildcat, Stark County; two payzones -- Madison with an IP of 0 but produced a little bit of oil (419 bbls) early on, but none in last four months; the Bakken, on DRL status;
These Chesapeake wells are all just south of Dickinson. In addition, there are a string of Chesapeake wells on the confidential list just north of these aforementioned wells.  So, maybe Chesapeake is about to makes  it move in North Dakota.

Boston Globe Raves About Barrow --

Link here.

Man-camps okay on the North Slope of Alaska.
At midnight, in the northernmost location in the United States, this town packed in ice seems unwelcoming. It is silent and cold. Frozen whale bones line the road. There is no connectivity to the outside world. In order to ward off polar bears, mace spray hangs from the door of the Distant Early Warning (DEW) facility.

The DEWline, a “man camp’’ because that is who is there, is primarily used to monitor the Russians, but also sleeps visitors looking for a place to stay. Nearly 300 miles above the Arctic Circle, there are no vacancies for the foreseeable future. It may be minus 35 degrees this Tuesday, but Barrow is hot.

This 3,500-person Alaskan town is changing. It has become a magnet for explorers and environmentalists, businessmen and rescuers, scientists and engineers, all of whom are coming here because the Arctic is melting and there is oil in the once-frozen ocean.

The United States Geological Service estimates there are about 25 billion barrels of oil in the Arctic; it could net a federal tax haul of $200 billion. Isolated Barrow, a place that has no road access in or out, will serve as the primary land location for all exploration activity. It is ground zero at the top of the world.
For newbies: Harold Hamm opines there area 24 billion barrels of recoverable oil in the Williston Basin Bakken. My back of the envelope calculations suggest there are 22.7 billion barrels. That's a joke. But seriously, doing back of the envelope calculations, one can see how Mr Hamm arrives at his figure.

Something tells me oil companies will need $100/bbl oil to make the Barrow operation profitable. I'm glad to see the president supports drilling in Alaska. Drill, drill, drill.

 A Note to the Granddaughters

Between my sophomore and junior years in college (or maybe my freshman and sophomore years, I forget) I was part of a research team doing some biology research in Barrow, Alaska.

I remember doing a lot of my laboratory experiments during the middle of the night and watching the sun never set. It came very close and it wasn't all that light or bright, but technically they were days of the midnight sun.

For some reason, and I don't recall why, I flew into Prudhoe Bay -- was I on my way home? I don't recall the reason for the flight. But for a few hours I was able to view the oil drilling staging complex at Prudhoe Bay. It was quite an interesting site. But not much to say except simply that I was there.

The one thing I do remember is that American Forces Radio Network got me through a summer where the radio was the ONLY entertainment. I remember hearing Donna Fargo's debut hit, "I'm The Happiest Girl in the Whole USA." Wow. 1972. So, it must have been between my junior and senior years of college. I graduated from college in 1973. I remember sending myself a letter with "DO NOT OPEN UNTIL NEXT YEAR" -- it was a letter telling me that under no circumstances to ever, ever participate in another biology research project in Barrow. If I have my years correct, it was the following year, the summer after graduation, that I hitchhiked from Williston -- starting out on the Million Dollar Way -- to New York City; flew to Europe on Air Luxemburg, and then spent the summer in Europe, hitchhiking or walking. The summer was filled with longing for being back in a suburb of New York City where I had met a wonderful, wonderful woman. Ah. the memories of youth.

Now, "back to the future," and the oil companies are returning to the Prudhoe Bay - Barrow area.  Barrow is the northernmost point of Alaska and is located, I suppose, about 500 air miles northwest of Prudhoe Bay.

Bakken Impact on Fargo -- Random Note

A reader sent me a reminder of something I noted when I was in the Bakken about six months ago: impossible to get maintenance work done on heavy machinery or trucks in the Williston area; mechanics are overwhelmed.

Trucking companies would buy a new truck to replace one that required maintenance.

Now, this note from a reader:
Butler Machinery, a heavy equipment dealer for the state: the dealer now trucks equipment to Fargo and Grand Forks for maintenance and repair. Turnaround time is about a week.
That makes sense: one day travel time on a flatbed to Grand Forks or Fargo; one day back; about three days in shop and one gets one-week turnaround time.

And, of course, there's a whole new industry growing in North Dakota: trucking heavy equipment back and forth between Williston and Grand Forks/Fargo. [Side note: it is interesting that the 4-lane divided highway from Williston to Grand Forks was completed literally just before the Bakken boom began. Purely serendipity. But what great serendipity.]

While out in the Bakken, I met a young man who had just bought a four-stall garage for large trucks for maintenance. This would be a drop in the bucket for all that needs to be done, but I'm sure he's busy as he can be and loving every minute of it.

First Time Unemployment Claims -- New Four Year Low

The "magic number" is 400,000.

Link here.
Initial claims for state unemployment benefits fell 5,000 to a seasonally adjusted 348,000, the lowest level since February 2008.

The prior week's figure was revised up to 353,000 from the previously reported 351,000.

The four-week moving average for new claims, considered a better measure of labor market trends, declined 1,250 to 355,000.

Slow-Rolling US Energy Companies -- Since 2009

Link here to another blog.

I get a lot of comments that take issue with my repeated comment that this administration is slow-rolling the domestic oil and gas industry.

This is one that may be most ominous and would fulfill the president's goal to kill the coal industry:
October 26, 2011: Secretary Salazar announces plan to merge BLM and OSM, an action that could move the coal mining industry one step closer to extinction and cause energy costs to skyrocket.
Nice to see a site I can refer to when I get those comments.

Keystone XL 1.0 Is Dead; The Story Won't Die -- Barack Supports the Keystone

Barack supports the pipeline: leaves a 1,179-mile gap -- details, details, details
TransCanada has not even submitted a new application
EPA and US Army Corps of Engineers can't begin work until they see an application
And we haven't even started talking about the Texas ranchers and the Sierra Club


March 21, 2012: Twenty-four hours later and Bloomberg says something different, but says the Cushing won't be sped up due to Obama's involvement. Leaves a 1,179-mile gap.

Original Post

This really is incredible. All that talk about TransCanada's Keystone XL 2.0S, the southern leg of the original Keystone XL (that is now dead), from Cushing to the Gulf. The president gives full support to the southern leg; says he will fast-track it. Shave off three to four months of the process.

One little glitch: TransCanada has not even submitted the application for Keystone XL 2.0S.

But TransCanada has not yet applied to build the southern leg, so it remains uncertain exactly which agencies would need to grant permits. Fish and Wildlife, the Environmental Protection Agency and the Army Corps of Engineers are some that would almost certainly would have to sign off.

Doug Garman, a spokesman for the U.S. Army Corps of Engineers, said TransCanada would need a permit from the agency if its pipeline work involves any waters under the Corps' jurisdiction outlined by U.S. clean water laws.
Fish and Wildlife? This is where three months will be saved; one phone call from the president.
US Army Corps of Engineers? Good luck.
EPA? Don't even get me started.

Again, the US entered and ended WWII in less time than it's taken to get where we are with regard to this pipeline. And if the application for the southern portion has not even been submitted, we are not even back to square one.

And that, folks, is how the federal government can slow-roll the oil and gas industry. The headlines were all about the SecState giving/not giving a green light to a 100 feet of pipeline -- the part that crosses the international border. But we haven't even begun to see the work that will be required by just Fish and Wildlife, and in the hierarchy of slow-rolling the oil and gas industry, they are near the lower rung.

The EPA will be tough enough, but the US Army Corps of Engineers. Wow.

Meanwhile, gasoline at $4.00/gasoline and peak driving season not here. Three refineries near Philadelphia may be closing. Workers at a huge refinery in the northwest may go on strike. And that's just business as normal. Oh, one more thing: the Mideast.

North Dakota Still #1 in Job Growth

ND has been #1 for 33 consecutive months

Link to Bismarck Tribune article.

Data points:
  • ranking by Arizona State University
  • January, 2011: ND jobs grew by 6.3 percent; WV and UT tied with 2.6 percent
  • Nationwide: 1.5 percent
  • Texas, 4th; Louisiana, 5th
  • common denominator: natural resources
And yes, the usual disclaimer about statistics. Whatever.

A Very, Very Good Article on Fracking

A reader sent me a link to an excellent article on what the Bakken has taught us with regard to horizontal fracking.

I've said many, many times, the actual production coming out of the Bakken is not the big story. The big story is the fact that the Bakken was really one of the first opportunities where drillers broke the code on fracking, and the area continues to be a laboratory for developing, tweaking new technology and processes.

This is a great reference article. This is one link I hope does not get broken.
When the industry cracked the code on shales, it unlocked a wealth of unconventional resources, introduced new methods of drilling and completions, and made “fracturing” a household word.

Technology sparked the shale boom that began a decade ago in the dry gas reservoirs of the Barnett play, and then moved to Haynesville, Marcellus and others. Technology has continued to drive the current migration into the oil and liquids-rich Bakken and Eagle Ford plays, with new and extremely prolific basins continually being discovered.

However, along the winding road of shale production, the industry has learned many important lessons, not the least of which is this: Fracturing methods that work in one play may not yield success in another.
An example of just a bit of the article:
Baker Hughes’ LiteProp ultra-lightweight proppants (UWLPs) are neutrally buoyant, low-density materials that are slightly heavier than fresh water but considerably less dense than sand. They can be placed throughout the induced fracture to enhance production with greater conductivity.

“Slick-water fluids drop all the proppant to the bottom of the fractures. But, the ultra-lightweight proppants can be transported deeper into the reservoir prop fractures to greater vertical height and provide a better flow of hydrocarbons,” Mr Nelson explained.

Over the years, there has also been considerable development in completion architecture technologies, such as packer and sleeve configurations that can allow more zones to be isolated and treated, Mr Brannon noted.

“We used to do six or eight intervals per well, but with enhanced packer and sleeve systems, we can get as high as 40 intervals with telescoping port systems, extending the stage count even farther,” he said.

Human Interest Story in the NY Times -- The Bakken, North Dakota, USA

A reader sent me a link to a very long article in the NY Times on the Bakken, about family men leaving home to work in North Dakota oil fields to get their financial situation back on track.

Two points, one minor, one major.

The minor point: the article mention that Amtrak is one way workers are getting back and forth between Williston and points east (Minnesota, for example). A reader sent me a note earlier suggesting that Amtrak may suspend services between Minneapolis and Williston while BNSF upgrades the tracks.

The larger point: the article talks about men commuting back and forth, working several weeks and then returning home. I don't think the article mentioned that more and more are returning with their families. The number of families coming to Williston has surprised many. I pointed out early on in my blog that based on my military experience, families would follow their husbands/fathers, but I, too, was surprised how big a deal that has become.

For those who know little about the Bakken, this is another interesting story -- five web pages in the NY Times. For regular readers of this blog, I doubt there is much new information.