Manufacturing Stage: KOG, The Smokey Wells, Pembroke Oil Field, Section 7-149-98

Note: originally these were the Smokey wells in Pembroke oil field, in sections 7, 8, 17, 18 - 149-97. KOG has Smokey wells in other oil fields. There are some exceptions; some of these Smokey wells, such as Smokey Kinden, are sited in different sections, even different townships. Smokey Kinden, for example: 21-149-98. Over time, I had added other Smokey wells in the general area.



Permits

2014

27447, PNC, Whiting/KOG, Smokey 4-29-32-13H3, Pembroke, 29-149-98,

27446, PNC, Whiting/KOG, Smokey 4-29-32-13H, Pembroke, 29-149-98,

Updates

February 9, 2014: screenshot of the Smokey wells as of today:

July 22, 2013: the Smokey wells have been updated; scroll down. 

April 16, 2013: This is one of two 12-well/1280-arce spacing tests KOG is conducting. KOG is testing 12 wells in one 1280-acre spacing unit: 6 wells targeting the middle Bakken; 3 wells targeting the first bench of the Three Forks; and, 3 wells targeting the second bench of the Three Forks. This is in there Smokey Prospect in McKenzie County, about four miles directly south of Watford City.

Original Post

Today a KOG well in this section came off the confidential list; it is one of four wells on a 4-well pad in the southeast quadrant of that section. #21392 went on DRL status. [Note: IPs and production numbers are updated as they become available.]

So, the other three wells on this 4-well pad will still be on the confidential list.

To this four-well pad, add seven more KOG locations in this same section, in the same quadrant, permits noted in today's daily activity report.

The KOG Smokey Wells

* = Came off confidential; produced for awhile; went back on confidential; re-fracked; huge story; see this post.

Permit	Status	Operator	Name	County	Field	Test Date	CUM	Status Date
21390	2,151	WLL/KOG	Smokey 15-7-6-2H3	McK	Pembroke	12/12	221K	7/21
21391	1,500	WLL/KOG	Smokey 15-7-6-2H	McK	Pembroke	12/12	282K	7/21
21392	1,466	WLL/KOG	Smokey 15-7-19-16H3	McK	Pembroke	12/12	121K	7/21
21393	1,950	WLL/KOG	Smokey 15-7-19-15H	McK	Pembroke	12/12	189K	7/21
24786	1,321	WLL/KOG	Smokey 13-7-19-14H	McK	Pembroke	9/13	149K	7/21
24787	1,329	WLL/KOG	Smokey 13-7-19-14H3M	McK	Pembroke	9/13	93K	7/21
24788	1,880	WLL/KOG	Smokey 13-7-19-13H	McK	Pembroke	9/13	165K	7/21
24789	1,669	WLL/KOG	Smokey 13-7-19-13H3	McK	Pembroke	9/13	150K	7/21
24790	1,859	WLL/KOG	Smokey 16-7-19-16H	McK	Pembroke	8/13	243K	7/21
24791	708	WLL/KOG	Smokey 16-7-19-16H3M	McK	Pembroke	8/13	57K	7/21
24792	1,867	WLL/KOG	Smokey 16-7-19-16HA (30 stages)	McK	Pembroke	8/12	155K	7/21
25361	2,348	WLL/KOG	Smokey 4-15-22-14H	McK	Pembroke	5/15	218K	7/21
25362	1,933	WLL/KOG	Smokey 4-15-22-13H3	McK	Pembroke	6/15	163K	7/21
25363	2,247	WLL/KOG	Smokey 4-15-22-13H	McK	Pembroke	5/15	230K	7/21
24899	2,067	WLL/KOG	Smokey 2-17-5-2H3	McK	Pembroke	10/13	253K	7/21
24900	2,328	WLL/KOG	Smokey 2-17-5-2H	McK	Pembroke	9/13	227K	7/21
24901	1,815	WLL/KOG	Smokey 2-17-5-3H3	McK	Pembroke	9/13	175K	7/21
24902	1,949	WLL/KOG	Smokey 3-17-20-14H	McK	Pembroke	1/14	229K	7/21
24903	1,319	WLL/KOG	Smokey 3-17-20-14H3	McK	Pembroke	12/13	99K	7/21
24904	2,002	WLL/KOG	Smokey 3-17-20-14HA	McK	Pembroke	1/14	196K	7/21
21181	IA/182	WLL/KOG	Smokey Karen 16-20-17-2H	McK	Pembroke	7/12	73K	6/21
21182	1,213	WLL/KOG	Smokey Kenny 16-20-17-2H3	McK	Pembroke	6/12	181K	7/21
21183	AB/1,638	WLL/KOG	Smokey 16-20-32-15H	McK	Pembroke	6/12	162K	2/19
21184	AB/1,738	WLL/KOG	Smokey 16-20-32-16H	McK	Pembroke	7/12	204K	10/18
21439	2,134	WLL/KOG	Smokey Cupcake 14-21-16-3H3	McK	Pembroke	11/12	271K	7/21
21440	1,404	WLL/KOG	Smokey 14-21-3312-14H3	McK	Pembroke	11/12	175K	7/21
21442	2,125	WLL/KOG	Smokey Kinden 14-21-16-3H	McK	Pembroke	11/12	280K	7/21
21443	2,036	WLL/KOG	Smokey 14-21-33-14H	McK	Pembroke	11/12	280K	7/21
20516*	50	WLL/KOG	Smokey 15-22-15-2HS	McK	Pembroke	12/11	444K	7/21
20596	101	WLL/KOG	Smokey 15-22-34-15H	McK	Pembroke	1/12	288K	7/21
23794	1,283	WLL/KOG	Smokey 3-30-18-2H3	McK	Pembroke	6/13	110K	7/21
23795	1,829	WLL/KOG	Smokey 3-30-18-3HA	McK	Pembroke	6/13	159K	7/21
23796	1,259	WLL/KOG	Smokey 3-30-31-15H3	McK	Pembroke	6/13	146K	7/21
23797	1,294	WLL/KOG	Smokey 3-30-18-3H3	McK	Pembroke	6/13	98K	7/21
25500	1,543	WLL/KOG	Smokey 3-17-20-14H3A	McK	Pembroke	1/14	172K	7/21

Dividend Increases: OKE, OKS, SLB, WMB

Yesterday, OKS announced a dividend increase.

Today, OKS, SLB, WMB announced increases:

• ONEOK Partners increased the partnership's quarterly cash distribution 2.5 cents to 71 cents per unit from 68.5 cents per unit, effective for the fourth quarter 2012, resulting in an annualized cash distribution of $2.84 per unit.  The distribution is payable Feb. 14, 2013, to unitholders of record as of Jan. 31, 2013.
• Schlumberger increases quarterly dividend 13.6% to $0.3125 from $0.275 per share 
• Williams Cos increases dividend 4.2% to $0.33875 from $0.325 per share

Rigzone Musings on the Falling Rig Count

This is a very, very interesting, compelling, and timely article at Rigzone regarding the falling rig count.

The linked article reflects on a Yahoo!Finance story:

We were intrigued to read a Yahoo! Finance headline a week ago Friday that the domestic drilling rig count was "falling off the cliff." The headline was attached to an article discussing the year-end report of the weekly Baker Hughes tally of various drilling rigs working in the oil patch. The article went on to discuss the trends among the various categories of drilling rigs that Baker Hughes reports – oil, gas, other, total, horizontal, directional and vertical. We understand that writers of news articles, especially those posted on news' websites, often become flamboyant with their headlines in order to draw readership. Still, "falling off the cliff" struck us as an over-the-top assessment.

The article provides some nice background and ends with this:

So while the Yahoo! Finance headline writer may think the decline in the rig count over the past few months is like going over a cliff, we suggest he should measure activity against the pattern during the financial crisis. That's a pattern we would call "falling off the cliff." Let's hope we never see that magnitude of an industry contraction again, although based on the history of the oil and gas business, it will re-occur sometime.

In between the first and the last paragraphs, the writer mentions the Bakken.

I have my own thoughts on all this, but I could never "compete" with an energy investment banker, so I will let the writer have the first word AND the last word.

For newbies:

• max number of active rigs in North Dakota in the current boom: 218
• current number of active rigs in North Dakota: 185
• assumption: 10 ND rigs now moved to the Montana side of the state line but still in the Bakken
• three companies, once "busy" in the Bakken have either cut back or suggested they will cut back on drilling
• others can do the math

MDU?

Considering this day started out rather slow, it certainly ended up being a very, very busy day.

See:

• Flaring concerns? Not to worry. Don't fight it.
• ONEOK to build a fifth natural gas gathering and processing plant.
• "Wet" natural gas -- #1 in return; see slide 17 of this PDF. (I haven't gone through the presentation, but "anon 1" directed me to slide 17.)
• Screenshot of natural gas production in North Dakota.
• Also, see the long comment at this post; the comment is time/dated: January 17, 2013, 10:09 pm.

Now, that you have refreshed yourself, look at this graph, comparing the two-year chart of two companies operating in the Bakken. One company's shares have appreciated 0% over the past two years. The other company's shares have appreciated 60% over the past two years (and recently as much as 70%). One company pays a dividend rate of 2.9%; the other, 3.1%. [The link worked for me; I don't know if it's a dynamic link; if the link "doesn't work," use Yahoo!Finance to compare MDU and OKE over the past two years.]

For those holding shares of MDU who are frustrated, a possible "replacement" might be OKE.

Disclaimer: this is not an investment site. I don't follow MDU any more; I have talked about MDU before. MDU was one of my early investments and I held it for years, but I finally sold it some years ago; I forget when I sold it but I think it was during the early days of the Bakken boom, perhaps when MDU/Fidelity/Oasis/Cottonwood story was announced. But I honestly forget; I might have sold MDU before then. So I don't follow MDU any more, but that doesn't mean I am not aware of its activity.

In a way, MDU will reflect the economy of the US because of its three, four, or five core competencies/divisions: if the US economy turns around, MDU should do very well. And the tea leaves suggest the US economy is turning around, suggesting to some that MDU might do so also.

But day in, day out, I see ONEOK activity in North Dakota, and the tea leaves certainly suggest continued growth.

Again, this is not an investment site: I'm not recommending anything. But ONEOK certainly has my attention. [Note: I own no shares in MDU or any of the ONEOK "companies." I won't be buying shares in either company in the near future, and probably never will. I'm already pretty overweighted in energy and won't buy more energy, except through already established automatic dividend reinvestment programs.]

Wells Coming Off the Confidential List Friday; Unremarkable; New Fidelity Well Is IA

Active Rigs: 185
Active rigs: 185 (steady)

Wells coming off the confidential list on Friday:

• 21021, 412, Sequel Energy, Frank 24-24H-1324-16095-TF, Stoneview, t12/12; cum 3K 11/12;
• 21392, drl, KOG, Smokey 15-7-19-15H3, Pembroke,
• 22236, IA, Fidelity, Hansen 18-19H, Stanley,
• 22641, 470, CLR, Narvik 1-35H, Wildcat, t11/12; cum 9K 11/12;

More on #22641. Looking at the NDIS GIS map server and the fact that it's a wildcat suggests to me that the well will be sited in section 35, and run north into sections 35 and 26 - T141N - R98W, Ukraina oil field. In that field, is this well about 2.25 miles to the northwest:

• 22609, 327, CLR, Kubas 1-22H, wildat, t812; cum 26K 11/12;
  the field is clearly designated the Ukraina oil field

In addition, there are three wells less than a mile away in North Creek oil field and New Hradec oil fiel, respectively:

• 21213, 240, GMX Resources, Frank 31-4-1H, New Hradec, t12/11; cum 19K 11/12;
• 21214, conf, GMX Resources, Frank 31-4-2H, New Hradec,
• 20788, 254, Whiting, Zalesky 34-8TFH, North Creek, t5/12; cum 14K 11/12;

Eleven (11) New Permits -- The Williston Basin, North Dakota, USA

Active rigs: 185 (no change; from my perspective, a perfect number)

Eleven (11) new permits --

• Operators: KOG (7), Hess (3), Slawson
• Fields: Van Hook (Mountrail), Big Gulch (Dunn), Pembroke (McKenzie)
• Notes: None. Maybe later.

Wells coming off the confidential list were posted earlier; see sidebar at the right.

Don't Even Get Me Started -- Federal Fracking Regulations

Link here to Oil & Gas Journal.

Project permits from federal agencies other than the US Federal Energy Regulatory Commission are taking interstate pipelines longer to obtain since passage of the 2005 Energy Policy Act, .....

The finding contradicts one of EPACT’s main purposes, which was to streamline and expedite permits for such projects, ....

Federal authorizations granted 180 days or longer after FERC issued an EIS or EA rose from 3.42% before EPACT became law to 19.51% after, the study said. It also found that the only EPACT provision that provides an applicant with recourse in the face of agency delay—a petition to the US Court of Appeals for the DC Circuit—has rarely been used, allowing agencies to miss the required federal authorization deadline without consequence.

 And that, folks, is why I am firmly against federal help with fracking permits. 

ONEOK To Add A Fifth Natural Gas Gathering and Processing Plant -- January 17, 2013

Just the link to Tulsa World News; more later.

ONEOK Partners will build its fifth natural gas processing plant in the Williston Basin region of North Dakota, the Tulsa-based infrastructure firm announced Thursday.

ONEOK Partners will invest an additional $500 million for growth projects in North Dakota, Oklahoma and Kansas. The pipeline and processing expansion brings the partnership’s capital investment program up between $4.7 billion and $5.3 billion through 2015.

One of the new projects will be Garden Creek III plant to process up to 100 million cubic feet in daily gas production from the Williston Basin, which includes the Bakken Shale and Three Forks formations. ONEOK Partners also will build a new 95-mile natural gas liquids pipeline from Medford, Okla., to Hutchinson, Kansas, and modify its NGL fractionation infrastructure in Hutchinson.

Yumpin' Yosemite! It's Colder Than Williston! Yikes!

Link here to the LA Times.

From Yosemite National Park:

In a report summarizing weather conditions between Jan. 9 and Wednesday, rangers at Tuolumne Meadows reported low temperatures of 17 degrees below zero (Jan. 10), 22 degrees below zero (Friday) and 21 degrees below zero (Saturday).

Meanwhile, it's been a balmy 30-degrees in Williston, dropping to 20 degrees (above zero) at night. That's a 40-degree nighttime spread between Yosemite and Williston. 

Williston Wire Updates

Headlines only (for the most part) and no links; it is easy to subscribe to the Williston Wire.

Williston's impact statement to meet population explosion over next six years: $625 million for infrastructure.

Williston airport: 2012 was a record year.

Success spreads across North Dakota; even in the small city of Carrington, on the more eastern side of the state, that is an unmet demand for housing.

Former Glasgow Air Force Base could house oil field workers and their families.

Multi-well pad drilling is changing the dynamics of the Bakken.

Reality television? An Illinois man survived riding out a North Dakota blizzard in his tent.

Random Update of the Brent / WTI Spread

January 17, 2013: At Bloomberg energy, Brent - $110.86; WTI $95.62 Spread: $15.

For random historical spreads, click here. 

Flaring Concerns? Ignore the Facts; Don't Fight The Trend; Opportunities Abound

This is a pretty good story, even though it comes from Motley Fool.

All things being equal, there will be more flaring in the Bakken in 2013 than there was in 2012 (raw numbers, not necessarily on a percentage basis). That's just the facts (at least from the little I know, and I could be way, way off). But I think I'm right. [A percentage of this produced natural gas is flared.]

Armchair analysts and activists (AAA) across the nation (notably in Washington, New York, Washington State, Oregon, and Dickinson, etc) are calling for an end to this flaring. And that means more money could be poured into companies who can assist. And that's where the linked article comes into play.

Looking from an investment angle, my first choice in the Bakken was railroads. I was long in BNI ... and then Warren bought it. Replaced it with Union Pacific.

My second choice for Bakken investments: crude oil pipelines. My favorite is ENB.

My third choice for Bakken investments: independent oil companies with prospects in both the Bakken and the Eagle Ford. My favorite is EOG.

My fourth choice for Bakken investments: I can't think of a fourth.

Until now. ONEOK surprised me, probably surprised others, when it saw the potential for natural gas in an oil field outside it's core operating area.

So, these are the tea leaves (blogged about earlier, may provide links later):

• pipelines will be the story of 2013
• increasing pressure to reduce flaring in North Dakota
• increased well density will naturally lead to more natural gas pipelines
• pipeline easements already in place, I assume, almost everywhere in the Bakken

And, now this Motley Fool article at the link. Companies mentioned:

• Enbridge Energy
• ONEOK
• Plains All American
• Energy Transfer Partners -- perhaps the most interesting of all, with opportunity to transport by rail either crude oil or natural gas

By the way, the North Dakota state legislature is mulling an idea to make laying natural gas pipeline more attractive. Don sent me the story some days ago; I never posted it; it was a "what-if" story -- but now might be the time to post it. From The Bismarck Tribune:

Legislators heard testimony Tuesday on a bill that would provide tax incentives and exemptions for the oil and gas industry to reduce natural gas flaring.

Members of the House Finance and Taxation Committee heard from state officials on House Bill 1134, which would allow natural gas to be flared for up to one year after production begins from a well.

The bill says that within one year, a well must either be capped, connected to a gas-gathering line or equipped with a generator that consumes at least 75 percent of the gas. A well also could be equipped with a system that gathers at least 75 percent of natural gas liquids for such uses as conversion to liquid fuels and production of petrochemicals or fertilizer.

A well that is connected to a gathering system from the first day of production would be eligible for an additional two-year oil exemption from state gross production taxes.

The key to reducing flaring: connecting the well to "a gathering system from the first day of production."

Think about this: the wind industry took off with a 2.2 cents/kwh tax credit (or whatever it was). A tax incentive for the natural gas industry in the Bakken, an oil field, starting to produce staggering amounts of natural gas, could do something similar. 

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here. This particular post is entirely idle chatter. I have no plans to act on anything I might be implying or that the reader might be inferring. I am a long term investor and do no "trading" (as a general rule; I assume there are exceptions, but I really can't remember any examples). I won't be making any changes to my investment portfolio during the next couple of weeks.

But wow, there are a lot of opportunities out there. Good luck to all.

Time For a New Poll

Results of previous poll on whether you, as a rule, watch the president's speeches?

• Yes: 31%
• No: 69%

***************************

Now, back to the Bakken. There is take-over talk: EOG. Two suitors mentioned: Chevron (CVX) and Statoil (STO). 

Which (CVX or STO) would be your preference?

Got EOG? Maybe Not For Long -- Takeover Talk? The Bakken Just Got Very Exciting. Again.

Link here to Bloomberg.

EOG Resources Inc., the U.S. crude oil producer that’s rallied more than any peer in the past six months, offers the biggest energy companies the chance to expand in one of the world’s fastest-growing markets.

Even after surging 32 percent since July, EOG trades at a below-average multiple of enterprise value to both production and profit, according to data compiled by Bloomberg. With Chief Executive Officer Mark Papa retiring in June, a takeover of the $34 billion company is more possible, Royal Bank of Canada said. 

EOG has exceeded analysts’ earnings projections for eight straight quarters, and in November forecast 2012 production growth of 10.6 percent, almost double the rate it estimated in February. The company has some of the best acreage in North America’s two top shale formations, the Bakken and Eagle Ford....

Most likely suitor: Chevron.

Other possibility: Statoil.

Sounds like a new poll is in store.

It should be noted that EOG has a market cap of about $35 billion; CLR has a market cap of about $15 billion. Looking at "Key Statistics" this would be easy for CVX from financial point of view (superficial look at the cash on hand, operating cash flow); more of a bite for STO (ASA).

New/Expanded Lumber Yard East of Minot

Link to Minot Daily News.

One of the oldest businesses in North Dakota has built a brand new facility here to serve the booming northwest corner of the state.

Crane Johnson Lumber Co. was founded 129 years ago in 1883 in Cooperstown. Today it has grown to include five lumber yards across North Dakota and Minnesota, including the new one in Surrey, as well as a truss and wall panel plant in Fargo called Mid States Truss.

Alert: Oil Up $1.30 -- Global Warming Pummelling Great Britain; Demand For Electricity Hit a Record Overnight; Beats The Old Record -- Set Earlier This Month -- Yes, Two New Records in the Same Month

Updates

September 24, 2015: The [London] Telegraph is reporting:

Britain generated more of its electricity from renewable sources than from burning coal for the first time in the second quarter of 2015, as more wind and solar farms were built.

A record high of 25.3 per cent of the UK’s power came from wind, solar, biomass and hydro-electric sources in the three months to June, up from just 16.7 per cent in the same period the year before.

By contrast the share of electricity from Britain’s ageing fleet of coal-fired power stations fell to 20.5 per cent, down from 28.2 per cent a year previously. 

Two of the many comments at the link:

I checked real time demand on the UK grid at 01:40 UK time a few evenings ago. Wind's contribution was 0.4% of total power being supplied to the grid to meet demand. It is time that the population woke up to the fact that installed capacity is not the same as real time contribution to demand.

Anyone can check the UK demand contribution by energy source in real time on the Internet. (Not quite real time but updated every 10 minutes, 24 hours per day, 365 days per year). Educate yourselves, don't be fooled by the propaganda spread by those profiting from wind power subsidies.

It is also necessary to build Gas Turbine Combined Cycle capacity to cater for conditions cited above i.e. when wind makes no meaningful contribution to demand. The electricity consumer is paying twice, once for the 'windmills' and paying again for backup capacity when wind power makes little or no contribution to demand.

The resulting dynamic demand environment experienced by GTCC plant due to the volatility of wind reduces life dramatically and increases maintenance costs significantly. More cost passed on to the consumer.

I analyzed three year worth of data, wind contribution to demand, every ten minutes. The average power from the windmills was 31% of wind installed capacity. That means on average two thirds of wind capacity is idle. If you do your homework you will find that other authors come up with practically the same value.

And:

A look at the actual statistics shows that for the three months to June, the demand was about 30GW with a wind peak of 5GW to which may be added a few GW for the other 'renewable' sources. The wind trough does of course approach zero at times, with solar always at zero for a large part of the day. The resultant renewables contribution is probably about 10% at best, and in winter the demand is up to 60GW, meaning that the winter contribution of renewables is ~5%.

Renewables cost between two and three times the cost of coal fired electricity, so the report is really saying that at even 10% contribution, renewables are an economic failure.

Original Post

 

Enjoy, while reading the post:

London Homesick Blues, Gary P Nunn, Jerry Jeff Walker

Huge thank you to "anon 1." It has been a slow news day (so far).

Some data points from the story at Platts.

• first of all, it's cold in Great Britain
• second of all, it's really cold in Great Britain
• how cold, you ask?
• 7 degrees Celsius below average in London (for newbies, one Celsius degree is just under two Fahrenheit degrees, so this is about 13 degrees below normal for London: COLD; with wind and humidity off the ocean, the WIND CHILL factor will make it feel worse
• so?
• the Brits used more natural gas on Wednesday than they have ever, ever used. Ever.

Here's the quote from the link:

Gas demand in the UK Wednesday surged 80 million cu m past seasonal norms to 389 million cu m on below-average temperatures gripped the country.

No mention of wind turbines kicking in. I assume they have frozen up. [Later: see comment below with source: "Gas-fired power generation hit its highest level for the 2012/13 winter to at 22 GW at about 1700 GMT due to a combination of strong overall power demand of 56.5 GW and wind generation levels falling below the 1 GW mark, according to National Grid data."]

Okay, so far this winter: record cold in Great Britain, Russia, China, southern California, and the Phoenix area, as in Arizona.

***********************

More, from MailOnLine about the cold snap in London:

• it will probably get colder next week
• snow predicted for some areas, though it will be very, very light (not enough to make a snowball)

Two interesting data points:

• Temperatures on Monday night reached a low of almost minus 2C (28F) in the West Country, but all over the UK biting winds made it feel far colder. -- as I noted above
• The National Grid said demand for electricity in England and Wales peaked on Monday evening at 52,710 megawatts, well above the previous record demand of 51,548 megawatts recorded on January 3, this year.

***********************

A Bit Of Fluff -- But, Hey, It's a Slow Day -- What Can I Say? Oasis, KOG

As regular readers know, I don't care for the Motley Fools all that much. Having said that, here' s a bit of light news from their site posted yesterday.

Taking a look at one money manager in particular, here are five small-caps that billionaire Louis Bacon's Moore Global Investments reported owning in its most recent 13F. 

To remain consistent with our strategy, each stock has a market capitalization between $1 billion and $5 billion. 

Two of Bacon’s other top five small-cap picks are in the oil and gas industry: Oasis Petroleum, its second largest small-cap holding, and Kodiak Oil & Gas, its fourth largest. With both trading below a $5 billion market cap, either could be a potential takeover target.

Again, this is not an investment site. Just idle chatter. Don't make any investment decisions based on what you read here. 

Got COP? -- SeekingAlpha

Link here to SeekingAlpha.com.

In the article "ConocoPhillips: Exploiting the Eagle Ford Shale, " the breakeven price for COP's Eagle Ford production is $37/barrel. This is why many oil execs believe the EF to be the most economic shale play in the U.S. 

During Q3 2012, COP was running 14 rigs in the Eagle Ford and the average daily production was 76,000 BOE/day with 79% liquids. The peak production rate achieved in Q3 was 86,000 BOE/day. On the Q3 conference call, management said they expect a peak rate of 100,000 BOE/day in Q4. The company is also adding infrastructure to maximize light crude sales prices at pipeline spec and to maximize its capture of NGLs.

A number of things.

First: this is not an investment site. Do not make any investment decisions based on what you read here.

This is a Bakken-centric blog, but companies operating in both the Eagle Ford and the Bakken are particularly exciting. I am very aware of EOG in both North Dakota and Texas. I had forgotten about COP.

And note the breakeven price for oil in the Eagle Ford: around $40. 

Thursday Links

First, great news. First time applications for unemployment benefits hit a 5-year low.

Market news, waiting: will PSX hold its gains? Apple looks like it is having a healthy rebound; Wall Street is playing the small retail investor like a fiddle. Gotta love it.

So, in early morning trading: the market must have like the unemployment numbers (first time unemployment benefits). PSX is up almost another dollar. It looks like BRK will flirt with a new high. Union Pacific Railroad has already hit a new 52-week high. Oil is up almost another dollar; solidly above $94. 

WSJ Links

Section D (Personal Journal): Nothing of interest.

Section C (Money & Investing):
Investors grapple with core reality of Apple.

Section B (Marketplace):
Wow -- AT&T stalking Europe for mergers.

A health scare for small businesses; ahead of ObamaCare -- small firms worry about crossing the 50-person threshold. Yup. And big businesses with move to 29-hour work week wherever possible; more out-sourcing.

Section A: Nothing of interest. Not even the op-ed page. Sorry.

Jobless Aid Applications Fall To 5-Year Low

Remember: the magic number is 400,000

Link to AP.

Happy days are here again.

The Labor Department says weekly unemployment benefit applications fell 37,000 to a seasonally adjusted 335,000. That's the lowest level since January 2008, just after the recession began.

The four-week average, a less volatile measure, fell to 359,250.

Pressure To Build Another Pipeline: Canada's Alberta Sands Oil to California

Two weeks ago I did not even know what WCS stood for ... now, I see it everywhere.

RBN Energy has a very, very interesting story this morning. It begins with this lede:

The pipelines transporting Western Canadian crude oil to US markets are full to overflowing. Space on the main lines is being rationed. As much as 250 Mb/d of new production is expected online during 2013. The price of Western Canadian Select heavy crude fell to nearly $40 under NYMEX WTI during the first week of January 2013. The pressure is on to build new takeaway capacity to Canada’s west coast. Today we look at the Trans Mountain Pipeline expansion project.

Bakken mineral rights owners are very, very aware of what happens to the price of oil when it's landlocked. Bakken oil was taking a $30 discount due to lack of takeaway capacity not too long ago.

For Canadian oil sands it deja vu all over again: Western Canadian Select is being priced at a $40 discount.

There is pressure to build another pipeline. This time, from Canada to California. This is even better than more solar panels and more wind turbines.

Another great post from RBN Energy; must read; great graphics including a great map.