Friday, March 23, 2012

Four (4) New Permits -- The Williston Basin, North Dakota, USA

The daily activity report is quite extensive today but not many new permits or IPs being reported.

Of interest: the nice well reported by Arsenal Energy; a nice well reported by Fidelity.

New permits for operators: Murex, MRO, CLR, Oasis

Fields: Stanley, Reunion Bay, and Camp

CLR has a wildcat in Billings Country.

Five (5) wells were released from "tight hole" status, but only one was completed/fracked:
  • 21230, 1,850, Arsenal Energy, Gjoa Lynn 100-12H, Mountrail,
Six producing wells were completed, including:
  • 20593, 1,201, Fidelity, Edith 14-29H-32, Mountrail;
  • 20950, 55, Silver Oak Energy, Rankin 1-35H, Slope County, Red River "B" (not a Bakken);
Sixteen (16) wells were reported to be plugged or producing, suggesting a bit of news in the near future.

Ten (10) permits were renewed and many of them of fairly recent vintage suggesting that operators are a bit behind in getting to all their locations.

Whiting had five (5) wells approved for "tight hole" status: one in Stark County; the others in Mountrail County, all Three Forks wells.

For more on Arsenal Energy:

Human Interest Story on Harold Hamm in the Billings Gazette

Link here.
Continental Resources helped touch off the Bakken oil boom nearly a decade ago when the Elm Coulee field northwest of Sidney was developed. Hamm still refers to Montana as the birthplace of the Bakken. Much of the oil activity moved east into North Dakota in ensuing years.

Geology has a lot to do with the rigs moving east. But activity is picking back up in Montana, with about 20 rigs operating, Hamm said.
The following is an interesting observation:
Gov. Brian Schweitzer said he and Hamm first met during negotiations for the Keystone XL pipeline. Producers in North Dakota were frustrated because pipeline developers didn't have much interest in transporting North Dakota crude.

"We had the largest field found in the world found in the past 40 years, and yet it's still not served by a major pipeline," Hamm said.
I've never really thought about that much, but when folks look back on the development of the largest continuous oil reservoir found in North America in 40 years, they will marvel at the hodge podge way the Bakken was put together, everything from man-camps to widened highways to Enbridge pipelines.

And, so far, in the big scheme of things, despite all my negative comments over the past year, NoDaks should be complemented on how well they've done. It's really very impressive when one considers that there were probably very few Harvard MBA's who were involved in the planning or the process. The Bakken was probably blessed by the fact that the president never visited.  Santorum's short Tioga visit is probably about as much any NoDak would like to see federal government involvement or interest.

Update on the Lodgepole Well North of Williston: Oasis Clark 5602 12-13H -- The Williston Basin, North Dakota, USA

Lodgepole Pool?


April 7, 2012: I have long been confused about what pool the Lodgepole formation is in. Note: I am talking about the Lodgepole formation lying above the Bakken, not the Lodgepole reefs around Dickinson. According to the NDGS, the Lodgepole formation is part of the Madison Group (Charles, Mission Canyon, and Lodgepole formations). But yet, according to Teegue, the Lodgepole formation is defined by oil companies and the NDIC not to be part of the Madison Pool. If anything, the Lodgepole is part of the Bakken Pool. [The NDIC does break it out by "Bakken/Lodgepole" when compiling yearly production by formation.] However, when completing a sundry form for the Clark well, Oasis changed the pool from Bakken to Lodgepole. Teegue says that if the Oasis Clark well becomes commercial, it will be defined as part of the Bakken Pool or will be defined as a newly defined Lodgepole Pool.

Note: #18179, DRL, Samson Resources, Holm State 16-162-98H, wildcat, north of Williston, is also a Lodgepole, and the NDIC lists the Pool as Lodgepole. It almost appears as if the NDIC already has a "Lodgepole" Pool and includes the wells targeting the reefs, as wells as those targeting the non-reef formation.

The Oil for America wells targeting the Lodgepole reefs around Dickinson were also identified as Lodgepole Pole, for example:
  • 20195, DRL, Oil for American, Dohrman 14-1, Wildcat, Lodgepole

Original Post

Before reading the rest of the post, go back and read the update on the Tyrone oil field, north of Williston.
  • 21261, 94, Oasis, Clark 5602 12-13H, came off confidential May 1, 2012; said to be economical by Oasis (personal correspondence); closed hole frack; 4 million lbs sand/ceramics
This well is back on the confidential list after coming off for a short period of time. One can access some of the filings before it went back on confidential.

This well was rumored to be a Lodgepole formation well, north of Williston. I have opined that if it is a "good" well, it could be another game changer.

An IP has not yet been reported, but it did produce 805 bbls of oil in an unknown number of days in January.

From the well file, the geologist's comment:
The Lodgepole Fracture Zone, the zone of interest in the Clark 5602 12-13H was entered at 10,077 feet MD, 9,882 feet total vertical depth....the lateral was planned to drill from the top to the bottom of the Lodgepole Fracture Zone, exploring for possible intervals of better show....gas monitoring and fluid gains provided evidence of a hydrocarbon saturated reservoir during the drilling of the Clark 5602 12-13H. Oil and gas shows at the shakers and in samples were continuously monitored...This allowed for gas and fluid gains from the well to be evaluated...During the lateral, observed concentrations ranged from 1,000 to 1,600 units background gas and connection peaks of 4,000 to 5,000 units. A down time gas of 7,858 units was noted at 10,600 feed MD and during a trip at 10,983 feet MD, a trip gas of 5,773 units was noted along with green brown oil [italics at the source] at the catch tank. Chromatography of gas revealed an abundance of methane and ethane, but also significant concentrations of propane and butane.
As this was to be an experimental drilling project, the onsite crew and Oasis reps developed a drilling plan in which the well-bore was to move from the top to the Lodgepole fracture zone to the bottom of the Lodgepole fracture zone....The well-site team worked well together maintaining the well-bore in the desired target interval for 100% of the lateral, opening 4,333 feet of potentially productive reservoir rock. 
The well was awaiting completion at the time of the geologist's report.

Murphy Creek Oil Field Has Been Updated -- The Bakken, North Dakota, USA

Link here. Nothing remarkable.

This is a huge oil field. Now that we are into five years of this boom, one can now start comparing cumulative production of several operators in one oil field.

Cushing Speech: Day 1 S/P ROCKS

The Remarkable Obama Cushing-Keystone Speech (ROCKS) was delivered March 21, 2012.
So what we’ve said to the company is, we’re happy to review future permits.  And today, we’re making this new pipeline from Cushing to the Gulf a priority.  So the southern leg of it we're making a priority, and we're going to go ahead and get that done. The northern portion of it we're going to have to review properly to make sure that the health and safety of the American people are protected.  That’s common sense. 
Translation: "This administration will slow-roll the southern portion (wink-wink) but we'll never see the northern portion approved while I'm (Barack) president."

Profiles in courage:
  • Obama: "We're happy to review future permits."
  • JFK: "We choose to go to the moon in this decade and do the other things, not because they are easy - but because they are hard"
Let's see how many days it takes to reach these milestones:
  • Day 0, March 21, 2012: ROCKS
  • Day 1, March 22, 2012: today
  • Day X: headline that TransCanada has started laying Keystone XL 2.0S
  • Day X: headline that TransCanada has submitted the application for XL 2.0N
  • Day X: headline that the president has approved Keystone XL 2.0N
  • Day X: headline that TransCanada has started laying Keystone XL 2.0N
  • Day X: headline that TransCanada is having insurmountable troubles completing the Keystone XL 2.0S (Texas ranchers, Sierra Club)
  • Day X: headline that TransCanada says the heck with it

Oil Spikes -- Talking Head: Due to Decreased Iranian Exports


Moments later: CNBC talking head says that traders are starting to question more openly whether Saudi can meet their pledge to cover any Iranian shortfall; Brent continues to outpace WTI; the gap continues to increase.

Original Post

Moments ago on CNBC: oil up about $1.35. CNBC crawler says due to decreased Iranian exports.

Let's look at the recent chronology:

First, we all knew that Iranian oil exports would decrease under sanctions --> price up.

Second, Saudi said they could cover any Iranian shortfall --> price down.

Third, today, -- prices up. The "first" above was a given, almost a "fact."  The "second" point -- well, there it is, we have differing opinions on the veracity of the Saudi reassurance.

Oil is now up about $1.50.

Can't They Just Turn Up the Wind -- It's Gonna Be a Long, Hot Summer


May 17, 2012: experts having trouble explaining problem with tubes at the San Onufre nuclear reactor. 
That failure led to an unparalleled shutdown of one of California's two nuclear power plants and triggered more than three months of detective work by Southern California Edison officials and federal nuclear regulators that has yet to determine the problem's root cause or when San Onofre will reopen.
When the plant is running at full power, the rate of steam flow is causing the tubes to vibrate, much like a guitar string being plucked. Some tubes vibrated enough that they rubbed against each other, causing the tube walls to wear down much faster than expected.

This is a potential danger because tube ruptures could release radiation and in extreme cases compromise the reactors' cooling system.
Call me naive, but something tells me a meltdown/radiation leak at San Onufre would cause a bit more concern than an oil spill. Just saying.

Original Post
Link here to the LA Times.

One of California's two nuclear plans may remain off-line through the summer. Can you spell r-o-l-l-i-n-g-[space bar]-b-l-a-c-k-o-u-t-s?

While California legislators focused on wind energy from out-of-state, they dropped their focus on Barack Obama's "all-of-the-above" energy plan. Even the president now supports the pipeline. Just not all of it. But I digress.

Back to the San Onufre nuclear reactor story. Can't they just turn up the wind?

Ok, the gig is up. It's over. I'm blogging away in a Dunkin' Donuts just down the street from where I'm staying, and a flock of motorcycle cops just flew in. All decked out in shiny blue, black, white uniforms on even shinier blue, black, and white motorcycles with "Special Operations" laminated everywhere. Somewhere I crossed the line. They caught me ... my last post.....I'm going....

Oh, never have got to be kidding --- six more just drove up --- it's a donut --- now a black and white SUV -- something's going down --- I was going to say it's a donut break, and I guess it is. I will keep you posted if anything exciting happens.

Wow, two more motorcycle cops: this time STATE POLICE, and they just backed their cycles in against the curb/sidewalk. I may have to move.

This looks like something out of NYPD. Ok, so now there must be something like 24 city police (Special Operations) and state police inside Dunkin' Donuts. Wow, a state police cruiser -- a blue and white sedan -- just turned the corner.  OK, I count 18 police inside right now, but don't know if I see them all.

Random Note: Example of a Shovel-Ready Job in Montana and North Dakota

Based on nightly news, the only energy project in the US is the Canadian Keystone XL

But, truth be told, a whole lot more is going on.

Link here to a great Billings Gazette video.