Sunday, March 3, 2013

Belgium Wins US Military Contract

Some folks might have thought this was a stretch when I posted this last Thursday. But, now, mainstream media is reporting the same thing: unions driving jobs overseas and/or to right-to-work states.

CNBC is reporting:
According to, after a dramatic bidding and re-bidding process, the M4A1 contract, with an estimated value of approximately $77 million, is going not to incumbent manufacturer Colt Defense nor Remington Arms, but to a foreign company, FN Herstal
While FN Herstal has its manufacturing plant in South Carolina, the company itself is a subsidiary of the Herstal Group, ... the government of Belgium.
FN Herstal underbid both Remington and Colt - in the case of Remington, by a margin of about $7 million. They may have had the luxury to do so because their South Carolina plant is in a "right to work state," where individuals can decide whether they want to join a union or pay union dues. Contrast that with Colt Defense, who had to give UAW union workers at its Connecticut plant a 5.5-percent raise over the past two years. That translates into higher costs for Colt to manufacture its products.
And so it goes.

Wall Street Cheat Sheet Highlights Whiting's Bakken/Three Forks Potential; The Second Bench of the TFS; Heavily Fractured Tarpon; Middle Bakken, Upper Three Forks, Lower Three Forks

Added after I completed the post below: wow, there's a lot of information about the Bakken packed into these few paragraphs. This is quite incredible. 

I'm still waiting for the earnings transcript but until then, this may add to our understanding of "the Bakken."

First question:
Moving to Tarpon. Obviously another huge well there and as you move to pad drilling I’m wondering if you could give some color on in your 2013 budget of the wells that you’ve got for the Northern Rockies, what percentage or ballpark number on the wells you’re expecting to drill at Tarpon this year in your budget?
CEO's answer:
The Tarpon is a prolific reservoir. 
We feel like we’re doing an effective job in middle Bakken with three wells per spacing units. We have four operated spacing units and we plan to essentially drill that out during 2013. 
We also have opportunity in the Three Forks there which we will be pursuing probably in following year
What’s really interesting at Tarpon is that we have identified both there, as well as Cassandra another drilling opportunity. We believe that the second bench of the Three Forks has received a good charge from the Bakken Shale area and we are seeing good saturations from core data that we’ve collected there at Tarpon and so we think we got an additional objective there to pursue and that’s probably going to be either late this year or 2014. And we think we can get up to three wells per spacing unit in there. 
The thing to recognize about Tarpon is that it is heavily fractured, that explains the high rates that we got and so that’s the – the well density there is somewhat less in some of the other areas that we are drilling.
Second question:
Concerning Whiting's  inventory --  your presentation suggests that primary and prospective location is more than double what you had before. Then I am looking at your reserve in a sense resource base is up about 3% or so. What is the disconnect and why the resource potential did not increase or almost doubled in a way. Could somebody explain it to me?
CEO's answer:
... we haven’t added those in yet. It’s basically something that’s occurred over the last six months of 2012, as we have seen the potential for everything on them there, meaning three additional wells in the upper Three Forks/1280, four Bakken Silk (sic) Wells and four middle Bakken wells/1280, four lower Three Forks/1280, three lower Three Forks/1280, so these are all additional locations that can be drilled as a result of the results that we’ve seen so far and the reservoir engineering that we have done and the core that we have taken. 
So, those are basically new objectives. Then we go into the higher density locations: Pronghorn Sand higher density; that’s three more additional Pronghorn Sand. The higher density at Sanish, that’s three additional middle Bakken. 
... Sanish has the highest OOIP of any place in the Williston Basin... that’s why we have the ability to drill another 191 wells there. 
Go to the link for more. 

By the way, I believe "Bakken Silk" above is a typo at the source and should be "Bakken Silt."

From an undated PDF on the net regarding Whiting's discovery of the Pronghorn:
Based on the stratigraphic analysis, Whiting jumped ahead of other firms to acquire 1 million gross and 680,000 net acres where the thickest section of Pronghorn dolomite is extrapolated. Whiting currently has 20 rigs in the area and has completed 3.3 million linear feet of drilling, with 5 million feet projected by the end of 2012. The company has drilled more than 80 wells to define the "Pronghorn" and "Lewis and Clark" fields in Stark, Billings, and southernmost McKenzie counties, North Dakota. The IP of the initial wells averaged 2,021 bopd and have been as high as 3,611 bopd. The take‐away message from this successful project is that geology matters!
As "anon 1" suggested, if Chesapeake were to sell, Whiting might be the perfect buyer.

Poll: What Is Chesapeake's Acreage in North Dakota Worth?

Time for a new poll. Based on results of the "happy face, sad face" poll, it sounds like folks want a new poll.

I find it strange that with the unconfirmed report late Friday night that Chesapeake would be selling their North Dakota acreage, there has been no confirmatory story (at least that I could find). It would be a huge story, and that's why I wonder about the accuracy of the story when I can't find anything else.

Having said that, assuming the source is correct, what do you think Chesapeake's acreage in North Dakota is worth to a buyer?

("Other" was not supposed to show up as an option. Sorry about that, but I don't have the time to correct the poll.)

From Carpe Diem: Bakken Drilling Costs Coming Down

Link here to CarpeDiem.

It's very interesting. When costs were becoming a concern to operators and shareholders, Continental Resources was one of the first to suggest that pad drilling would result in about a 10% savings in drilling costs/well.

During that discussion regarding drilling costs, perhaps over a 12-month period, I read a lot of SeekingAlpha transcripts and a lot of corporate presentations. About the only variable I recall being discussed regarding costs was "pad drilling." Seldom was the decreased drilling time mentioned.

When the Bakken boom began, it seemed drilling times were 45 to 60 days. Now, NDIC has said average drilling time is under 20 days. Pad drilling saves time (and money) but I would wager that decreased drilling times will be a bigger contributor to decreased costs.

Unfortunately, those savings will be offset by an increased number of frack stages.

Wells Coming Off The Confidential List -- KOG With Two Huge Wells; Legacy With A Nice Spearfish Well; Hess With A Nice Well

Monday, March 4, 2013
22447, 973, G3 Operating, J. Rasmussen 1-26-35H,  Strandahl, t12/12; cum 13K 1/13;
23085, 2,506, KOG, Moccasin Creek 16-10-3-3H3, Moccasin Creek, t12/12; cum 35K 1/13;
23167, 1,127, Hess, BB-Sivertson (sic) 151-95-2019H-3, Blue Buttes, t11/12; cum 74K 1/13;
23492, 199, CLR, Lovland 1-7H, 23638, conf, Slawson, Pathfinder 2-9H,  Upland, t12/12; cum 2K 1/13;

Sunday, March 3, 2013 
23084, 2,129, KOG, Moccasin Creek 16-10-3-3H, Moccasin Creek, t1/13; cum 23K 1/13;
21821, 180, Legacy Oil, Legacy Etal Wunderlich 5-6H, North Souris, a Spearfish well; t10/12; cum 13K 1/13;
22343, 655, Zenergy, Cliffside 25-36H, Assiniboine, t11/13; cum 14K 1/13;
22359, 1,147, Zenergy, Helling 30-31H, Pronghorn, t1/13; cum 4K 1/13;

Saturday, March 2, 2013 
22318, drl, Crescent Point, CPEUSC Samples 26-35-159N-100W, wildcat,
22451, drl, MRO, Curtis Kerr 24-8H,  Bailey,
22684, drl, Hess, EN-Jeffrey A-155-94-2734H-2, Alkali Creek,


 23167, 1,127, Hess, BB-Sivertson (sic) 151-95-2019H-3, Blue Buttes, t11/12; cum 74K 1/13; not on a gas line yet:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

23084, 2,129, KOG, Moccasin Creek 16-10-3-3H, Moccasin Creek, t1/13; cum 23K 1/13;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

Random Comment Re-Posted: CLR's Experience In The Bakken

The following came in as a comment to another post from a reader (this was some time ago; I had it it draft form and forgot to post it). I was just going to link the comment for those who might not see the comments, but the comment was so well done, I thought I would place it here as a stand-alone post for a larger audience:
For CLR, the company that started developing the Cedar Hills Red River continuous dolomite with horizontal drilling in Bowman County almost 30 years ago, just keeps chugging along. Nothing flashy.

When Leigh Price offered there may be over 500 Billion barrels in the Bakken I’m sure there was much skepticism. Today Harold Hamm says 80% more than that. Also something that has made Cedar Hills successful is the results of secondary recovery. CLR once again has a lot of experience in this area but has made no attempt on this effort in the Bakken that I am aware of.

They are still advancing their position with drilling and fracking as witnessed by the wells listed below in sections 28 and 29 of 146/96. The Bice 1-29H was one of the first TF wells drilled by CLR. The Bice 2-29H was part of an effort to determine if there was communication between TF and MB. The Hartman 1 and 2 were drilled about 1 ½ miles to the east of the Bice wells with Hartman 3 and 4 located between the earlier drilled two sets of wells.

I have no back ground or education to comment on the information below but looking at the data makes for some interesting head scratching. After 3 years Bice 2 and Hartman 1 are almost ½ way to your estimated recovery. Hartman 3 and 4 are off to a much better start.
  • 16943 TF Bice 1-29H completed 5/9/8 IP 516 BO 1st 30 days approx 8,600; cum 126K 1/13;
  • 17530 TF Hartman 1-28H comp 11/10/09 IP 780 1st 30 days approx 15,600 cum 177K 1/13;
  • 17884 MB Bice 2-29H comp 12/21/09 IP 147 1st 30 days (over 3 mo) approx 15,000 cum 192K 1/13;
  • 21524 MB Hartman 2-28H comp 5/16/12 IP 732 1st 30 days approx 17,100 cum 90K 1/13;
  • 23212 TF Hartman 4-28H comp 11/14/12 IP 1,656 1st 30 day approx 28,566; cum 47K 1/13;
  • 23213 MB Hartman 3-28H comp 11/13/12 IP 1,703 1st 30 days approx 29,711; cum 49K 1/13;
I have full confidence in CLR’s estimated recovery rates. I am confident that when they have some fully drilled out units and introduce secondary recovery the recovery rates will go up and the decline rates will go down. Just as they have done in Cedar Hills. 
Great comment. Thank you. 

Adios, Amigos

The New York Times bids a fond farewell to its "Green Blog." The NYT:
This change will allow us to direct production resources to other online projects. But we will forge ahead with our aggressive reporting on environmental and energy topics...
...but doesn't say how. [To put this in perspective, apparently the NYT has eight (8) sports blogs.]

Wow, the comments are most interesting (as usual). This is one, but certainly not the best:
Blah, blah, blah. Saw the writing on the wall when you dumped your science reporters. I really can't understand why, in 2013, NYT would be choosing to allocate fewer rather than more resources into environmental coverage, when climate change and environmental degradation are surely the issues of our times.
Go to the link, read the comments.

I wonder if the Green Blog was dumped so it would not have to report Obama's decision to approve the Keystone XL 2.0. KXL2.0 is the defining issue -- not the most important energy issue of his second term, but the "defining" issue -- of his second term.

Flaring And Those Satellite Views -- Another Look

Remember all those satellite shots of northwest North Dakota suggesting that flaring was the reason for all the "hot spots"? So, another look.

From the NASA Earth Observatory website, comes this interesting bit of trivia:
On November 12, 2012, the Visible Infrared Imaging Radiometer Suite (VIIRS) on the Suomi NPP satellite captured this nighttime view of widespread drilling throughout the area. Most of the bright specks are lights associated with drilling equipment and temporary housing near drilling sites, though a few are evidence of gas flaring. Some of the brighter areas correspond to towns and cities including Williston, Minot, and Dickinson. 
I assume it would be too much to ask to have this checked out at

If any one has driven by an active rig at night, one would be amazed at the amount of light on site: the entire pad is lit up like Times Square on New Year's Eve. It is really quite a sight, and something everyone should get a chance to see. Certainly as awe-inspiring as seeing a giant sequoia.

For Global Warming Deniers Only ...

... all others should scroll down or visit archived sites at the sidebar at the right.

And, definitely, if you came to this site searching for news about Bakken oil, skip this post. 

[For archival purposes only; for my purpose only; not for general readership.]

WattsUpWithThat, through RealScience, is reporting: the Arctic sets a record for ice gain this year. It's really a remarkable story, and several story lines. But first the story:
Arctic sea ice has made a stunning rebound since the record low recorded in the late summer of 2012.
With a few weeks of growth still to occur, the Arctic has blown away the previous record for ice gain this winter. This is only the third winter in history when more than 10 million km² of new ice has formed.
The graph at the site goes back to 1980, and even the most graphically-challenged observer can interpret this graph.

There's a ton of information in that story and at that link. One could spend a lot of time thinking about questions, hypotheses, theories, that could be asked/raised.

The comments are also important. My favorite, of course, is the global warming apologist who says this is predicted by global warming -- that global warming would, in fact, increase Arctic ice.


All this time, I thought global warming apologists said Arctic ice was shrinking. I must have mis-read those stories; it wouldn't be the first time.

Right, wrong, or indifferent, whether global warming decreases or increases Arctic ice, one can't have it both ways, using the same argument.

However, this is all a red herring anyway. Total global ice? Arctic is trivial when compared to the Antarctic and the Antarctic is growing. The Antarctic accounts for 90% of the earth's ice.

Again, this post is for global warming deniers; apologists can easily find other sites that refute all of this, but the graph at the linked site, and the comments at the linked site are, priceless. 

March Dockets: Overlapping Spacing Units

A reader asked where the pads would be built for the overlapping 2560-acre spacing units proposed in case number 19797 in the March, 2013, NDIC hearing dockets. This is way beyond my expertise, but it doesn't hurt to start the discussion.

Here is case 19797:
Application of Hess Corp. for an order amending the applicable orders for the Truax-Bakken Pool to establish six overlapping 2560-acre spacing units consisting of Sections 3, 4, 9 and 10; Sections 5, 6, 7 and 8; Sections 17, 18, 19 and 20; and Sections 29, 30, 31 and 32, T.154N., R.98W., Williams County, ND and Sections 14, 15, 22 and 23, T.153N., R.98W., Williams and McKenzie Counties; and Sections 17, 18, 19 and 20, T.153N., R.98W., Williams County for the purpose of drilling one or more horizontal wells between the existing 1280-acre spacing units; and such other relief as is appropriate.
I am still looking for a nice site that explains the nuances of "overlapping spacing units" in the Bakken.

This is as good a discussion as I've seen to date, back in 2009. At the link, scroll to Teegue's comment, dated 12/2/09. [As usual, he consistently provides the best (and clearest) explanations. Much appreciated.]

While reading that linked thread, bring up the NDIC GIS map server and do three things after zooming into the Truax oil field. First, check 640-acre spacing in the Truax. I don't see any (but I've been wrong before.) Then, check 1280-acre spacing. It appears the entire field has been zoned for 1280-acre spacing which means (at least to me, the operators can file for a permit to drill a Bakken well with 1280-acre spacing in the Truax without going through a NDIC docket hearing). Finally, check out 2560-acre spacing. There are several proposed units still under consideration by the NDIC (at least that's how I understand the map server; again, I have been wrong in the past, and could be wrong again).

An individual asked where the pads would be placed for these proposed spacing units in case number 19797. There are six (6) proposed units in this case; I will look at one, and from there, one can extrapolate to the others.

The one I will look at: the proposed overlapping 2560-acre spacing unit consisting of sections 3, 4, 9, and 10. That's  a nice square. One existing stand-up 1280-acre spacing unit makes up the east (right) half of this square; another existing stand-up 1280-acre spacing unit makes up the west (left) half of this square, the proposed overlapping 2560-acre spacing unit.

Hess proposes this unit for "the purpose of drilling one or more horizontal wells between the existing 1280-acre spacing units."

Based on the two active wells already in the two 1280-acre spacing units (#22946 and #22612) -- which are sited near the south line of the proposed unit and run north, my hunch is that the pad would be sited at the corner where sections 9, 10, 15, and 16 all meet; if so, the horizontal would run north, paralleling #22946 and #22612.

If anyone is interested in continuing the discussion, at least two other questions come to mind:
a) why? what is the purpose of the overlapping unit in the first place; and,
b) who shares in the royalties of the wells drilled in the overlapping unit, and drilled between the existing 1280-acre units
Those questions are easy to answer and are covered at the Bakken Shale Discussion Group linked above.

A much more interesting question is the effect these wells will have on existing wells. I think this is a much more nuanced question, still under study, but a question that has been addressed at the Million Dollar Way before. But, I think it's only been discussed once (maybe twice at the blog) and there's no way I will be able to find it among the more than 10,000 posts (to date) that exist.

Another obvious question, of course, takes us back to a poll I did a long, long time ago, but I won't open that up again (at least not at this time).

Disclaimer: this whole discussion is beyond my comfort zone. When I get out of my comfort zone, I make errors. I'm sure folks will let me know where I have erred. [Shoot. Even in my comfort zone, I make errors.]

While I am at it, how are those two wells noted above doing?
  • 22612, 481, Hess, SC-Bingeman-154-98-0904H-1, t9/12; cum 30K 1/13;
  • 22946, 1,122, Hess, SC-Hoving 154-98-1003H-1, t9/12; cum 92K 1/13;

Random Update on the Statoil/BEXP Pad in Northwest Williston; The Pyramid Wells

The Pyramid Wells On The Northwest Side Of Williston
Near the New Williston High School

  • 22872, 3,091, Statoil/BEXP, Pyramid 15-22 4H (changed from 4TFH), Todd, t3/13; cum 279K 7/17;
  • 22873, 2.835, Statoil/BEXP, Pyramid 15-22 3H, Todd, 9,132 bbls in first 6 days; s7/5/12; kop7/14/12; td9/10/12; no flare; t3/13; cum 261K 7/17;
  • 22874, 1,884, Statoil, Pyramid 15-22 2TFH, Todd, 32 stages; 3.8 million lbs sand/ceramic; almost no background gas during lateral drilling, t3/13; cum 143K 7/17;
  • 22875, 2,341, Statoil, Pyramid 15-22 1H, Todd, t4/13; cum 208K 7/17;

March 18, 2015: see the stream of notes below regarding the small production from some of the Pyramid wells in August, 2014. A reader provided the answer: meter mis-allocation. Production from all the wells is commingled into a tank battery. Meters are installed to track allocation from each well. Occasionally the meters get screwed up. Bottom line: no production decrease for these Pyramid wells in August, 2014; simply a meter anomaly.

March 17, 2015: while updating the Pyramid wells, I noted strange production numbers of #22874 (which has had history of strange production numbers); look at 31 days of production in August, 2014; only 38 bbls of production, and only 594 bbls sold:


The same is true of #22875, again look at 8/14 data:


It appears the data is the same for all Pyramid wells; most likely not on-line the entire 31 days; perhaps the error is number of days being reported; 

February 27, 2014: photo of the Pyramid pad.

November 24, 2013: note the variability in production in #22872 and #22873.

October 10, 2013: a reader noticed a discrepancy or change in production numbers for #22874. Note May, 2013, in the table below, and the production in the July 15, 2013, update:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
I feel quite comfortable that the May, 2013, production number originally reported was a typographical error. A reader notified the NDIC; they said the data is automatically updated from the operator; NDIC does not type in the data, so the data (apparently) originates with the operator.
August 9, 2013:
  • 22872, 3,091, BEXP, Pyramid 15-22 4H (changed from 4TFH), Todd, t3/13; cum 150K 1/15;
  • 22873, 2.835, BEXP, Pyramid 15-22 3H, Todd, 9,132 bbls in first 6 days; s7/5/12; kop7/14/12; td9/10/12; no flare; t3/13; cum 194K 1/15;
  • 22874, 1,884, Statoil, Pyramid 15-22 2TFH, Todd, 32 stages; 3.8 million lbs sand/ceramic; almost no background gas during lateral drilling, t3/13; cum 95K 1/15; this well is on a pump;
  • 22875, 2,341, Statoil, Pyramid 15-22 1H, Todd, t4/13; cum 148K 1/15;
July 15, 2013:
  • 22874, 1,884, Statoil, Pyramid 15-22 2TFH, Todd, 32 stages; 3.8 million lbs sand/ceramic; almost no background gas during lateral drilling, t3/13; cum 95K 1/15;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

As incredible as that well is, it's not alone:
  • 22875, 2,341, Statoil, Pyramid 15-22 1H, Todd, t4/13; cum 148K 1/15;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

Original Post

One has to think the name of these wells -- the "Pyramid" wells suggest something quite big, even for the Bakken. Vern Whitten aerial photograph of the Pyramid wells.

I decided to do a stand-alone post on a BEXP pad that is getting a fair amount of attention since the initial post was getting a bit long for that particular page.

The site is actually inside Williston city limits according to the NDIC GIS map servers, in the northwest corner of Williston, and the northwest corner of section 15-154-101.  I believe this information is not new: this BEXP site has been discussed before. But it will be very, very interesting to follow. It appears Google maps now shows the pad. It is almost exactly two miles west of where the Williston bypass intersects "2&85" north of Williston. Compared to other single well pads in the immediate area this pad seems to be about two- to three-times larger.  There is currently one 4-well pad, of which three wells are on DRL status and run south; the fourth is still confidential. (In an earlier comment or post I had mistakenly thought the pad under question was farther west; but now the site has been correctly identified.)
  • 22872, 3,091, BEXP, Pyramid 15-22 4H (changed from 4TFH), Todd, t3/13; cum 150K 1/15;
  • 22873, 2.835, BEXP, Pyramid 15-22 3H, Todd, 9,132 bbls in first 6 days; s7/5/12; kop7/14/12; td9/10/12; no flare; cum 194K 1/15;
  • 22874, 1,884, Statoil, Pyramid 15-22 2TFH, Todd, 32 stages; 3.8 million lbs sand/ceramic; almost no background gas during lateral drilling, t3/13; cum 95K 1/15;
  • 22875, 2,341, BEXP, Pyramid 15-22 1H; Todd; s7/30/12; kop [o/a 8/11/12]; td8/17/12; a 1 - 4 foot flare was noted; but also a 25 - 30' flare was observed at 17765' after tripping in the hole due to a motor failure; t4/13; cum 148K 1/15;

March, 2013 production numbers:

22872, 3,091, BEXP, Pyramid 15-22 4H (changed from 4TFH), Todd, t3/13; cum 150K 1/15;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

22873, 2,835, BEXP, Pyramid 15-22 3H, Todd, 9,132 bbls in first 6 days; s7/5/12; kop7/14/12; td9/10/12; no flare; t3/12; cum 194K 1/15;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

22874, 1,884, BEXP, Pyramid 15-22 2TFH; Todd; s7/3/12; kop7/26/12; td8/28/12; no flare; t3/13; cum 95K 1/15;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

22875, 2,341, BEXP, Pyramid 15-22 1H; Todd; s7/30/12; kop [o/a 8/11/12]; td8/17/12; a 1 - 4 foot flare was noted; but also a 25 - 30' flare was observed at 17765' after tripping in the hole due to a motor failure; t4/13; cum 148K 1/15;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare