Friday, June 22, 2012

Increasing Your Odds in the Bakken

Idle chatter overheard at a Williston diner:
If one owns mineral rights anywhere in a spacing unit, one participates in royalties generated by producing wells in that spacing unit.

With a 1280-acre unit, it is pretty standard to see two wells, right now. With a  2560-acre spacing unit, it is pretty common to see four wells. If you are a mineral owner in a 1280-acre unit, you have two chances at the lottery. With a 2560-acre spacing unit, you have four chances at the lottery.

Over time, the odds will get even better as they add more and more wells to each spacing unit. This is just a snapshot in time.
Fictional conversation, as far as I know, but certainly possible.

Gulf Oil Workers Being Evacuated Ahead of Storm -- Absolutely Nothing To Do With The Bakken -- Isn't That Wonderful?

One more reason the Bakken will keep plugging along: no hurricanes. Not a lot of terrorists, either. Fairly politically stable. Business friendly.

Severance Taxes: Comparing The States; Stripper Well Taxes and The Loophole


April 3, 2013: ND legislature looking at stripper well loophole:
To encourage investment in oil development, the Legislature many years ago exempted stripper wells — those producing less than 30 barrels of oil a day — from the state extraction tax.
However, the exemption applies to an entire production spacing unit, and since the boom, some high-producing Bakken wells in the same unit that has a stripper well have escaped the extraction tax.
For at least two sessions, legislators have talked about closing the loophole, and this year Cook included stripper well changes as part of a comprehensive oil tax reform bill. It was killed in the House, largely due to a controversial plan to lower the oil extraction tax.
By combining the stripper well changes with oil tax changes, he was able to make the bill “revenue neutral.” 
Original Post
Very, very good article; a must read.

The "Grandfather" of "Global Warming" Speaks Up/Speaks Out

Link here to the Toronto Sun. If the link is broken, google "global warming drivel grandfather Lovelock."

Coincidentally, this story was posted the very same day:
Rucker then asked whether it would be wise for Branson to tax his clients, considering that “support for global-warming science is eroding worldwide.” Over one thousand climate scientists dispute the hypothesis that global warming is man-made, Rucker noted, and over 31,000 natural scientists have signed a statement saying there is no convincing evidence that humans are causing catastrophic global warming.

New Medical Complex In Williston; Mercy Hospital in Williston May Be Fastest Growing Hospital In the Nation; HAL Donates $25,000

These two stories were in the Williston Wireline.

A Bismarck-based group, Rhavon, LLC, is building Rhavon Medical Park along the bypass on the west side of the city. On almost 13 acres of property, the main facility will be a 30,000-square-foot 3-story building with urgent care clinic and other unspecified specialty care. This story is a bit "confusing" to me in that the building has been there for quite some time, under construction, and it has long been known that it was going to be a medical facility. Maybe that was all "rumor" and now the "i"s have been dotted, and the "t"s crossed, making it official. Regardless, this will be a new outpatient medical facility across the bypass from Mercy Medical Center.
Second:  And speaking of Mercy Medical Center, a spokesperson said this hospital may be the fastest growing hospital in the nation. The Wireline also noted that Halliburton recently donated $25,000 to the hospital.

BNSF To Invest Almost $200 Million In Railway in Minnesota, North Dakota

Earlier this year I suggested that the railroads would likely increase CAPEX for maintenance and more rail. Not everyone agreed, suggesting that coal and grain shipments greatly exceeded anything coming out of the oil patch. So, it was with interest to see this story today:
BNSF Railway (BNSF) is planning to invest $100m in Minnesota and $86m in North Dakota for railway maintenance, capacity improvements and expansion projects in 2012.
This is what I wrote May 25, 2012:
a) the industry can't build tank cars fast enough
b) the rails were not meant to handle this much traffic; there will be need for more tracks and lot more maintenance
The BNSF story (second link above):
Under the project, BNSF will upgrade rail sidings to increase speed, as well as improve a US government-mandated positive train control (PTC) system.

The investment will also be used for a track maintenance programme in Minnesota, which will include 1,817 miles of surfacing and undercutting work, as well as the replacement of 42 miles of rail and 325,000 ties.
Anyway, go to the link. It's absolutely incredible all that BNSF will be doing to improve the system. 

I found it interesting the amount that will be spent in Minnesota.

Williston Wireline has the story and that's where I found it.

Follow-Up to The "Problem" With The Blog Late Last Week

Late last week I received a note from two trusted readers that their anti-viral program had "alerted" on the "MillionDollarWay" blog as a "fraudulent site." I spent the weekend trying to sort out the problem; a lot of wasted time, but in the end, everything is back to normal.

The "blog" was never a problem, and I didn't change anything. Taking it offline for a short period of time, and then bringing it back up, was about all I did.

Today, the Bismarck Tribune posted a short note suggesting a very similar experience; click here for the story.

The timing is such that the dots may connect. It's very possible that anti-viral programs are so good these days that when they search a site, they also check the linked articles. I link to the Bismarck Tribune not less than five times a week in an average week. It is very possible that the anti-viral links were picking up something at the linked articles.

I don't know. The issue with my blog and the issue with the Bismarck Tribune could be entirely unrelated but the timing is such it's very, very coincidental, if not related.

A bit "thank you" to Don for alerting me to the story, and a big "thank you" for the Bismarck Tribune to post the story.


Highway 61 Revisited, Million Dollar Bashers

Memo To Self: File Under "You Have Got To Be Kidding" -- 15 Up-And-Coming Cities -- BusinessInsider

The fifteen:
  • Brooklyn, NY
  • Seattle, WA
  • Austin, TX
  • Portland, OR
  • Boulder, CO
  • Raleigh, NC
  • Detroit, MI
  • Philadelphia, PA
  • Nashville, TN
  • Bentonville, AR
  • Burlington, VT
  • Mountain View, CA
  • Pittsburgh, PA
  • Salt Lake City, UT
  • Williston, ND
Another way to look at this list: give the list to the person sitting next to you, and ask him/her to select the one city that does not "fit" in with the rest of the list.

A huge "thank you" to 'anonymous' for sending me the link. I never would have seen it.

Encana Boosts Drilling CAPEX

Link here. This story was posted when oil was falling to "new" lows. Hopefully it will put things into perspective.

New Montana Oil Site on the Internet: Montana Petroleum Report

Don sent me this link: Montana Petroleum Report. I have not had a chance to look at the site yet.

It is also linked at my "Data Links" page above.

Menard's To Dickinson; A Note For The Granddaughters

Link here, scroll down to June 22, 2012.

A Note For the Granddaughters

I had not planned to visit the Apple store at "The Shops at the Prudential Center" in Boston today but I did. It's a long story why I went today but not worth writing about (which is probably true of the rest of this note, also).

I am always amazed when I go to an Apple store. The one at the Prudential Center, on Boylston Street, is a huge, 3-story building. Again, as usual it was very, very busy when I was there, just after it opened, 10:00 a.m. Friday morning, today.

I found what I had been looking for and struck up a conversation with one of the employees. I asked him -- it was my impression -- that all the "things" Apple talked about at their most recent conference were available now, except for the new operating system, Mountain Lion. He thought for a moment, and then agreed, to the best of his knowledge that was true. He said that anyone buying an Apple product after June 11, and, requiring the new operating system could get it as a free upgrade when it becomes available later this summer. I think I heard him say the new operating system would be out sometime in July.

I asked him what he thought of the new Microsoft mock-up, the Surface. He suggested I look at this video:

We both agreed that one has to give Microsoft credit for the keyboard cover. If Apple can "copy" that without really "copying" Microsoft, that would be great.

The Apple store is as amazing as ever. I think there were ten employees behind the Genius Bar on the third flood; customers were waiting their turn to be helped. Meanwhile in the front section of the third floor, they had individual tables for group training and individual training. In all, I counted 22 -- twenty-two -- Apple employees on the third floor. On the second floor there were ten employees. I forgot to count those on the first floor -- I got engaged in a conversation with one of the employees, but I think there were about six employees on the first floor. That's a total of at least 38 employees. And they were all engaged with customers.

There were at least two security men which I had not seen before, one each on the second and third floor, and I assume there was one on the first floor that I simply didn't see. Again, there was no cashier per se, but unlike before where any number of employees might be walking around able to make a sale, this time there were specific locations where folks made their purchases. No cash. All credit cards. And no paper receipts unless one wants one. The receipt is e-mailed to your home address. Upon swiping my credit card, my e-mail address popped up on the screen. He confirmed with me that it was my address. I think the entire process took 30 seconds; it would have been faster had I been focused on the task at hand.

Oh, the retinal display. Simply incredible. One has to see it to believe it. It is not a gimmick. It is real.

East Coast Refining: Running For An Exit -- An RBN Energy Series

Link to RBN Energy, Part I.

Part II

Energy links at Independent Stock Analysis

Link here for ISA.

A lot of great articles at the link. I particularly enjoy Bloomberg's "The Iran sanctions won't mean squat."
China’s imports of crude from Iran rose to the highest level this year even as Western nations stepped up pressure to cut purchases of the commodity from the Persian Gulf nation.

China, the world’s second-biggest crude consumer, bought 2.22 million tons of oil from Iran in May, according to a report e-mailed by the Beijing-based General Administration of Customs today. That’s equivalent to more than 524,000 barrels a day, up 35 percent from the 390,000 barrels a day purchased in April. It imported 2.27 million tons, or about 537,000 barrels a day, in May last year.
But this one in Popular Mechanics was great: North Dakota is the next hub for US Energy. This should bring newbies up to date with what is going on in the Bakken. I've linked it at the right sidebar for easy access.