From a March, 2012 article:Moments later: moments after posting the story below, I saw this op-ed by Saudi Arabia's oil minister Ali al-Naimi. The Saudi Minister says here is plenty of oil sloshing around. So why the high price? I don't know, and I don't think anyone else does either. I think part of it has to do with "just-in-time" delivery. Plenty of oil can be sloshing around, but countries are bidding for it as their supplies from Iran are shut off. For all I know Saudi is holding oil in tankers off-shore waiting for a higher bid. Elsewhere I've read there is an excess of ocean-going tankers and it's actually fairly inexpensive to "store" oil offshore. Again, I have no idea. But if there is plenty of oil sloshing around offshore and yet the price of oil is "ridiculously high" there has to be a reason.
Saudi Arabia increased production to 10.047 million barrels a day in November, the highest in at least three decades. The kingdom, the world’s biggest crude exporter, has the capacity to produce 12.5 million barrels a day and will pump about 9.9 million barrels a day this month and in April, al-Naimi told reporters at the Ritz Carlton hotel in the Qatari capital. [In this article, Saudi says it can increase production 25% if necessary.]From a May 20, 2012, article:
Saudi Arabia, OPEC’s largest producer, increased daily output to 9.923 million barrels in March, up 0.7 percent to the second-highest level since at least 1980, according to the initiative.
Saudi Arabian Oil Minister Ali al-Naimi mounted his most direct rhetorical attack against high oil prices on Wednesday, but showed no sign of moving to increase supplies even as France joined the United States and Britain in talks for a release of strategic reserves. [Interesting, huh?]
Two weeks after Reuters initially reported that Britain and the United States were set to agree on tapping emergency stockpiles, French Energy Minister Eric Besson said the European nation was also in talks with Washington. Le Monde reported that the move could come in a matter of weeks. [Trial balloon: be prepared for release of oil from SPR. It's interesting that there is not a shortage of oil.]At the same time, the Financial Times published a rare opinion piece by the head of the world's largest crude oil exporter, who said a feared shortage of oil supplies was a "myth" but reiterated that Saudi Arabia was ready, able and willing to meet any gap in supplies.
The moves emphasized the growing concern from both sides of the market -- producers and consumers -- about the economic and political impact of the 15 percent jump in oil prices this year. But it also highlighted the different responses they are taking.
The U.S. now enjoys an incredible energy price advantage that not only is transforming industries (for example, it shouldn't be too long before we start seeing cars that run on LNG), but that should be an important source of growth for the entire economy. This could be the best reason to be bullish."
North Dakota led the country with the highest gain in state income for 2011 (8.1%), the largest increase in per-capita state income (6.7%), and the highest gain in personal income during the last quarter of 2011 (1.5%).Note: net worth is different than net income. I wonder how much per-capita net worth grew in North Dakota in 2011? It doesn't take many new millionaires to affect a state with a low population like North Dakota.
The Obama administration today endorsed new oil and gas exploration along the Atlantic Coast, setting the stage for possible future drilling lease sales.
The announcement by the Interior Department sets into motion what will be at least a five year environmental survey to determine whether and where oil production might occur.
It also comes as President Obama faces mounting pressure over high gas prices and criticism from Republicans that he has opposed more drilling for oil."Making decisions based on sound science, public input and the best information available is a critical component to this administration's all-of-the-above energy strategy," said Interior Secretary Ken Salazar.
As President Barack Obama pushes to fast-track an oil pipeline from Oklahoma south to the Gulf Coast, an American Indian tribe that calls the oil hub home worries the route might disrupt sacred sites holding the unmarked graves of their ancestors.And so it goes.
Sac and Fox Nation Chief George Thurman plans to voice his concerns this week in Washington. He said he fears workers placing the 485-mile Keystone XL pipeline that would run from Cushing to refineries on Texas' Gulf Coast could disturb holy ground without consideration of the tribe. He and another tribe member say the pipeline's route travels through areas where unmarked graves are likely buried.
"We've been here 171 years," said Sandra Massey, the Sac and Fox Nation's historic preservation officer.
"We've been living and dying here. We are all over."
In 2008, the U.S. Geological Survey estimated the Bakken formation could have up to 4.3 billion barrels of recoverable oil. But they've sent a team of geologists and geochemists back to the Bakken to study rock samples from previous drillings. They normally reassess oil formations after about 10 years, but the Bakken isn't a typical oil formation.I've always said that; it's not the production, it's the lessons learned and ground-breaking technology being tested, studied, and used in the Bakken.
"It's very rare that we reassess this quickly," said Brenda Pierce, the manger of the USGS Energy Resources Program. "The Bakken is such an unusual reservoir and what is technically recoverable really has changed in a short period of time."
Pierce also said their scientists are learning new concepts from studying the Bakken.
"I mean I think it's kind of breaking the way for other potential unconventional oil reserves (and) resources," Pierce said. "I mean it really is world class."
The USGS is using the same methods to survey the Bakken so the results can be more accurately compared to previous assessments. They plan to complete the study by late 2013.
USEG today reported the initial production rate on the Wang 10-3 #1H well and the Crescent Farms 7-6 #1H well under its drilling program with Zavanna, LLC.Locations:
Williston Basin, North Dakota - Yellowstone Program:
The next two wells which have drilled to depth in this program and are scheduled to be fracture stimulated in April 2012 are;
- 20094, The Wang 10-3 #1H well was fracture stimulated with 35 stages and had an early 24-hour flow back rate of 2,208 BOE/D on a 36/64" restricted choke during drillout of the plugs. The initial production rate consisted of approximately 1,942 barrels of oil and 1.6 MMCF of natural gas. The Company has an approximate 18% WI and 14% NRI in this well. The Wang well began production on March 15, 2012.
- 20105, The Crescent Farms 7-6 #1H has also been fracture stimulated with 35 stages and had an early 24-hour flow back rate of 2,437 BOE/D on a 36/64" restricted choke during drillout of the plugs. The initial production rate consisted of approximately 2,178 barrels of oil and 1.5 MMCF of natural gas. The Company has an approximate 27% WI and 21% NRI in this well. The Crescent Farms well began production on March 22, 2012 and represents the highest reported IP rate for a Zavanna drilling program well to date.
"We are pleased to announce the successive record IP results of the Wang and Crescent Farms wells with Zavanna. These two higher interest wells coupled with the two additional scheduled for the month of April should add meaningfully to our production for the second quarter of 2012," stated Keith Larsen, CEO of U.S. Energy Corp.
- 20093, The Skorpil 11-2 #1H well, in which the Company has an approximate 23% WI and 18% NRI.
- 20000, The CDK 15-22 #1H well, in which the Company has an approximate 32% WI and 25% NRI.
The price of an average gallon of regular gas surpassed the $3.90 mark Wednesday, moving to within a dime of the $4 threshold. [Comment: I'm glad Yahoo provided this arithmetic calculation; the math can get complicated as one approaches $5 gasoline.]Earlier: my thoughts on average price of gasoline across the nation, and the price that the average American is paying.
The average price rose 1.3 cents to $3.911 in the latest daily survey conducted for the motorist group AAA. The price has risen for 19 consecutive days. [And for Noah, it rained 40 days and 40 nights. Consecutively.]
The current price compares to just below $3.70 a month ago, and just below $3.59 a year ago. [For all the chatter, this is about a dime's difference and we survived last year just fine.]
The assets include 37,900 net acres in the North Dakota and Montana Bakken play and interests in more than 1,000 gross wells. The assets produced 2.5 thousand barrels of oil equivalent per day as of December 2011.Net acreage approaching 1 million acres in the ND and MT Bakken.
Continental said it expects to issue between 3.90 million and 4.25 million shares to fund the purchase price.
'Wheatland is owned 75% by the Revocable Inter Vivos Trust of Harold G. Hamm, of which Harold Hamm is sole trustee and beneficiary, and 25% by Jeff Hume. Mr. Hamm is Chairman of the Board, Chief Executive Officer and the majority shareholder of Continental Resources. Mr. Hume is President and Chief Operating Officer of Continental Resources.'Elwood opines (at the link): CLR could be "positioning" for acquisition.