Saturday, April 7, 2012

Kankakee, Illinois -- Nothing To Do With the Bakken

Story in WSJ: Sprint's New 4G? Trek to Kankakee
Over the next few weeks, Sprint Nextel Corp. plans to introduce two smartphones with the tantalizing promise of super-fast speeds on the carrier's 4G LTE network. One problem: These phones are most likely to reach the promised top speeds in just one town: Kankakee, Illinois.

For now, the Illinois town about 60 miles south of Chicago, with a population of 27,537, is the only spot Sprint will name where the service is up and running.

It's not clear why Sprint chose this town, whose average poverty rate between 2006 and 2010 was 31.2%, compared with 13.8% nationwide, according to the U.S. Census Bureau.
I can already see the ads.

City of New Orleans, Arlo Guthrie

Riding on the City of New Orleans,
Illinois Central Monday morning rail.
Fifteen cars and fifteen restless riders,
Three conductors and twenty-five sacks of mail.

All along the southbound odyssey
The train pulls out at Kankakee
Rolls along past houses, farms, and 4G towers....

Montana Update

Atlanta, Georgia's Journal-Constitution Just Can't Believe North Dakota Students Are This Bright -- Nothing To Do With the Bakken

No child left behind

Link here to Bismarck Tribune.
Education officials investigating suggestions that school districts in Bismarck and Fargo may have cheated on North Dakota State Assessment tests say they have found no evidence of fudging test scores.

Bismarck Public Schools and Fargo Public Schools were identified, along with 196 other large school districts across the nation, as having a suspiciously unusual fluctuation in test scores from one year to the next. The allegations came from the Atlanta Journal-Constitution, a Georgia newspaper that examined test results from 70,000 public schools.
.... 'nuf said.

Spacing -- Liberty 24-2531 -- #20557 / #21225 -- Unusual Spacing Size/Shape -- The Bakken, North Dakota, USA


April 8, 2012: This is interesting but trivial. Just some housekeeping. The well in question: 20557, was mis-named by the original poster. It should have been Liberty 24-2531W, not Liberty 24-2531H. In fact, #20557, Liberty 24-2531W permit was canceled, never drilled. Its sister well was drilled just a bit to the east, #21225, Liberty 24-2531H. So the discussion below has been updated to correct the file number and the name of the well.

Original Post

Over at the best Bakken discussion group board on the web, "wormy" has asked a great question:
  •  how will they work out the spacing for #20557, Liberty 24-2531W? [corrected]
We are going to start seeing a lot more spacing issues going forward. Older wells in the Bakken are generally spaced at 640-acre, 1280-acre, and more recently 2560-acre.

But now, we see that new wells are going in where Bakken wells already exist, and operators are asking for new spacing rules for some of these wells. A term you will be seeing more of in the ND hearing dockets: overlapping.

In the specific case above, it appears the NDIC is yet to determine the proper spacing for this well (at the NDIC site, the spacing is noted to be: ICO).
Link here here to FAQ #53: With regard to spacing, what does ICO mean? ICO = Industrial Commision Order. The driller requests an unusual size or shape for a spacing unit. Requires an NDIC hearing for approval.
The well was spud in section 25.  It cuts diagonally across that entire 640-acre section, and then cuts through the northeast quadrant of section 36 in the same township before ending in section 31 of the neighboring township, in the southwest quadrant of that section.  All three sections that the horizontal traverses are currently spaced at 640 acres.

Common sense suggests 1920-acre spacing, in an "L" configuration, which means mineral owners as far away as the southwest corner of section 36-151-91 will participate. One could argue that a 2x2 2560-acre spacing unit would also be appropriate based on other 2x2 2560-acre spacing units.

Update: Three New Refineries in North Dakota


June 29, 2012: Stark County approves rezoning for the new Dickinson refinery

Original Post
Link here to Bismarck Tribune.

North Dakota consumes 1.5 million gallons of diesel/day; up 70 percent in past five years -- not just oil industry, but farming industry.

Data points:

Three Affilitated Tribes oil refinery
  • June 1, 2012, update here
  • on the Fort Berthold reservation
  • --> diesel
  • 15,000 bbl/day
  • it actually has a permit....from.... the ....drum roll ... EPA
  • furthest along of the three proposed refineries
  • it has been "in the works" for eight (8) years
  • [way down in the article, this little, "oh by the way" -- waiting for final clearance from the EPA -- who wudda thought? it turns out some of the local residents appealed the EPA permit when the tribe changed source of oil from Canadian oil to Bakken oil;  permit is now being re-evaluated; don't hold your breath]
  • financing to pay over 20 years; now asking whether it will be a "money maker" -- after eight years of working on this -- I guess it's as good a time as ever to ask whether the refinery will make money
Dakota Oil Processing
  • Website here; includes a Fact Sheet; suggests breaking ground in 2012; operational late 2013;
  • --> diesel
  • 20,000 bbl/day
  • near Trenton, southwest of Williston
  • a close second to TAT oil refinery; has air quality permit from health department [with the TAT permit held up by appeal, DOP may be first of the three]
  • needs water treatment permit
  • hopes to break ground this summer; be on line by end of next year (2013)
  • $200 million project
  • 100 workers to build it; 40 - 50 temporary housing units
WBI Energy: MDU Resources/Calument Refining joint venture
  • update, June 28, 2016: $430 million; way over budget; MDU buys Calumet's 50% stake on June 27, 2016, and then announces sale of entire refinery to Tesoro on June 28, 2016; sold for $10 million cash and transferring $66 million in debt 
  • update, June 29, 2012: zoning approved; 274 acres; $325 million; 100 employees when operational;
  • update, May 16, 2012; open mtg; scouted a 200-acre plot of land about five miles southwest of Dickinson on 116th Avenue Southwest.
  • early planning stages
  • near Richardton / Dickinson (don't hold your breath, especially if it means lots of men living together)
  • along the BNSF railway
  • $250 million for a modular unit; $410 million for a "stick built" project
  • 20,000 bbl/day 
  • only state permits will be required
Tesoro Refinery, Mandan, ND
  • increasing capacity by 10,000 bbls to 68,000 bbls/day

ND: #1 -- Annual Update on North Dakota Honey Production -- Nothing To Do With the Bakken

Link to Bismarck Tribune.

Data points (some numbers rounded):
  • North Dakota: #1 in honey production in 2011.
  • 8th consecutive year #1
  • 30% drop in production
  • 33 million pounds

  • California: #2
  • 18 million pounds

  • South Dakota: #3
  • 17 million pounds
Nationally, honey production dropped 15% to 150 million pounds.