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Monday, April 1, 2013

Excellent, Excellent Discussion Regarding 2560-Acre Spacing

Over at The Bakken Shale Discussion Group. A must-read.
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Global Warming Is Causing The Antarctic Ice Mass To Increase In Size (Or Not -- It Might Be Due To The Wind)

Okay, I hope we are all in agreement that in spite of whatever the global temperature has been doing over the past couple of decades, the Antarctic continent of ice is expanding. It's been reported several times on the Million Dollar Way, thank you. But first, you have to accept that. If you can't accept that, then we really can't go any farther.

Back in September, 2013, I devoted a stand-alone post to the phenomenon.

Scientists have observed this phenomenon for quite some time and have not been able to explain it. Why is the Antarctic expanding, while the Arctic is shrinking?

Well, scientists, reporting in the journal Nature Geoscience, now have an explanation:
Climate change is expanding Antarctica's sea ice, according to a scientific study in the journal Nature Geoscience.
The paradoxical phenomenon is thought to be caused by relatively cold plumes of fresh water derived from melting beneath the Antarctic ice shelves. This melt water has a relatively low density, so it accumulates in the top layer of the ocean.
The cool surface waters then re-freeze more easily during Autumn and Winter. This explains the observed peak in sea ice during these seasons, a team from the Royal Netherlands Meteorological Institute (KNMI) in De Bilt says in its peer-reviewed paper.
Climate scientists have been intrigued by observations that Antarctic sea ice shows a small but statistically significant expansion of about 1.9% per decade since 1985, while sea ice in the Arctic has been shrinking over past decades.
That's interesting: the cool surface waters then re-freeze more easily during the southern hemisphere's Autumn and Winter.Who wudda thought?

But, it turns out, there are other explanations, also; explanations not related to climate change.

Whatever. I'm waiting for scientists to explain how global warming resulted in the coldest March (2013) on record, since 1996. Another inconvenient truth.
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Random Examples of Non-Bakken Monster Wells In The Williston Basin

There are probably more examples, but for no particular reason here are four examples of some very old wells that have targeted three formations. All three formations are now PNA in one well; one formation is still producing in two of the wells; and in one well, two formations are still producing. The oldest well was spud in 1953. There could be typos; I was pretty tired by the time I got to these wells.

Three payzone well, total production, ~ 2.63 million bbls; now PNA
  • 235, 478, Hess, Lalim-Borstad 35-41, Tioga field, Madison; t1/53; cum 283K; PNA;
  • 235, 429, Hess, Lalim-Borstad 35-41, Tioga field, Ordovician; t8/67; cum 956K; PNA;
  • 235, 265, Hess, Lalim-Borstad 35-41, Tioga field,  Devonian; t7/84; cum 1.40 million; PNA;
Three payzone well, total production, ~ 926K bbls; one formation still producing
  • 6757, 768, Encore, Clark 1, Missouri Ridge, Red River; t8/79; cum 588K; PNA;
  • 6757, 262, Encore, Clark 1, Missouri Ridge, Stonewall; t8/79; cum 345K; AL; 12/12;
  • 6757, 3, Encore, Clark 1, Missouri Ridge, Birdbear; t11/01; cum 329; PNA;
Three payzone well, total production, ~ 831K bbls; one formation still producing
  • 7142, 318, Whiting, E. B. Green 1-1, Sioux Field, Red River; t2/80; cum 588K; PNA;
  • 7142, 59, Whiting, E. B. Green 1-1, Sioux Field, Madison; t7/02; cum 176K; AL; 1,000 bbls/month 1/13;
  • 7142, 167, Whiting, E. B. Green 1-1, Sioux Field, Duperow; t7/02; cum 67K; AL; 7/09;
Three payzone well, total production, ~ 1.084 million bbls; one formation still producing
  • 11700, 118, SM Energy, B. A. Green 1, Sioux Field, Stonewall; t3/03; cum 84K; AL; 400 bbls/month 1/13;
  • 11700, 59, SM Energy, B. A. Green 1, Sioux Field, Red River; t11/85; cum 841K; PNA
  • 11700, N/D, SM Energy, B. A. Green 1, Sioux Field, Duperow; tN/D; cum 159K; AL; 1,000 bbls/month 1/13;
You can see examples of other "monster" wells here.
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Wells Coming Off The Confidential List Tuesday

Wells coming off the confidential list Tuesday:
22709, 733, Liberty Resources, Gullikson 152-103-31-30-1H, Glass Bluff, t10/12; cum 43K 1/13;
22967, drl, BR, CCU Burner 21-26MBH, Corral Creek,
23218, drl, CLR, Mildred 3-19H, Brooklyn,
23219, drl, CLR, Mildred 2-19H, Brooklyn,
23755, 1,092, SM Energy, Prochnick 16-35HS, West Ambrose, t2/13; cum --

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Ten (10) hours of "What Is Love?"


What Is Love, A Night At The Roxbury


Yes, ten hours. I played it continuously to confirm. There are no gaps. I thought there was one at the 10:06:45 but it was okay. I just lost my wi-fi connection for a moment.
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Fields and Field Updates

Counties
Slope County
Stark County 

Non-Bakken Fields
Elmore Madison Unit (EMU) 

Bakken Fields
Alexandria
Alger
Alkali Creek
Ambrose - Blooming Prairie - West Ambrose
Antelope
Avoca
Bailey 
Baker 
Banks 
Bear Creek
Bear Den
Beaver Lodge
Bell
Bicentennial
Big Bend
Big Butte
Big Gulch
Big Stick
Blue Buttes: sweet spot in the Bakken; west of the reservation; an old field; "owned" by Hess
Bowline: "owned" by True Oil
Briar Creek
Brooklyn: a small, non-descript field NE of Williston; "owned" by CLR; excellent example of how an operator systematically drilled one entire field with one rig; holding the entire field by production within a year or so; has received the most comments of any field.
Bull Butte
Bully
Cabernet
Camel Butte
Camp
Capa
Catwalk
Cedar Coulee
Cedar Hills
Charbonneau and the League of Nations
Charlson
Chateau
Chatfield 
Cherry Creek -- "owned" by Hess, a small field, 12 sections; very, very good wells
Chimney Butte
Clarks Creek: sweet spot in the Bakken; western boundary of the reservation; "owned" by EOG; will put 22 wells on one 2560-acre spacing unit (April, 2013, dockets)
Clear Creek : sweet spot in the Bakken; northeast McKenzie County; part of CLR's multi-well, multi-year TFS study (October, 2012)
Clear Water
Corral Creek -- Unit Field
Cottonwood
Cow Creek
Crazy Man
Deep Water Creek Bay
Dimond
Dollar Joe
Dublin
Eagle Nest
East Fork
Eightmile
Elidah
Elk
Elkhorn Ranch
Ellisville
Ellsworth
Elm Tree
Epping
Epping-Ray Corridor
Estes - Hay Creek - Harding - Nelson Bridge: four small fields SW of Williston, east of Fairview 
Fancy Buttes -- owned by CLR; two sections;
Fayette
Fertile
Foreman Butte
Fort Berthold Indian Reservation
Four Bears 
Garnet
Gaylord
Glass Bluff
Glenburn
Grail
Grinnell
Hamlet
Harding - Hay Creek - Estes - Nelson Bridge: four small fields SW of Williston, east of Fairview 
Hardscrabble
Hawkeye
Hay Creek - Harding - Estes - Nelson Bridge: four small fields SW of Williston, east of Fairview
Hayland
Haystack Butte: BR to unitize Haystack;
Heart Butte
Heart River -- a 38-section field in the southwest part of the state; between Dickinson and South Heart; mostly Fidelity and Emerald Oil
Hebron: a small, non-descript field NW of Williston; "owned" by CLR; updated April 1, 2013
Hoot Owl
Ice Caves
Indian Hill
Jim Creek
Johnson Corner
Keene
Kittleson Slough
Kuroki
Lake Darling
Little Knife
Little Tank
Lone Butte
Lone Tree Lake
Long Creek
Lost Bridge
Manitou
Marmon
McGregor
McGregory Buttes
Missouri Ridge
Moccasin Creek: a huge field; owned by KOG; never interested me until today (KOG with a gusher on 320-acre spacing)
Murphy Creek
Nameless
Nelson Bridge - Estes - Hay Creek - Harding: four small fields SW of Williston, east of Fairview 
Newburg
North Fork
North Souris - Red Rock
Oakdale
Oliver
Otter
Painted Woods
Park
Parshall
Patent Gate
Pembroke
Pershing 
Pleasant Hill
Poe
Ragged Butte
Rainbow
Rattlesnake Point
Rawson
Red Rock - North Souris
Red Wing Creek
Renville
Reunion Bay
Robinson Lake
Rocky Ridge
Ross
Round Prairie
Russian Creek
Sand Creek
Sanish: perhaps the most prolific field in the Bakken; a relatively large field; "owned" by Whiting; generally 6 wells in every 1280-acre spacing unit; borders the Parshall to the east;
Sandrocks 
Scairt Woman
Sheep Butte
Simon Butte
Sioux Trail
Siverston
Slawson: Big Bend/Van Hook
Snow Field
South Fork
Spotted Horn
Spring Creek
Squaw Creek
Squaw Gap
Squires
St Anthony
St Demetrius
Stockyard Creek
Stoneview
Stony Creek
Strandahl
Temple
Timber Creek
Tobacco Garden
Todd -- west side of Williston; field of dreams?
Truax
Twin Buttes
Twin Valley 
Tyrone
Union Center
Van Hook
West Capa
Westberg
Williston
Willow Creek
Wolf Bay
Zenith


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Ten (10) New Permits -- The Williston Basin, North Dakota, USA

Active rigs: 186 (steady)

 Ten (10) new permits --
  • Operators: Whiting (3), Oasis (2), Slawson (2), CLR, Petro-Hunt, WPX
  • Fields: Sanish (Mountrail), Alkali Creek (Mountrail), Van Hook (Mountrail), Little Knife (McKenzie),
  • Comments:
Wells coming off the confidential list were posted earlier; see sidebar at the right.

A "quiet" daily activity report.
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Losing His Clout -- But, Of Course, Then, Most Can See Through The Lie; For Every Gallon of Gasoline, 50 Cents in Taxes; 2 Cents in Profit for XOMs

Let's get real, folks. 

ABCNews is reporting:
A last minute entreaty by President Obama wasn’t enough to convince senators to strip the oil and gas industry of billions in tax incentives. [All industrial companies have same tax incentives; not just oil and gas.]
The president said today that Americans are getting fleeced by an oil industry awash in profits [compare the margin XOM receives on a gallon of gasoline vs margin AAPL gets for its productts] – pinched at the pump by rising prices and forking over billions in taxpayer cash and he put his weight behind a senate bill that would repeal the tax incentives. [Price at the pump would simply go up more, for several reasons.]
“Think about that. It’s like hitting the American people twice,” Obama said in a Rose Garden press conference, just before senators considered a bill that would roll back many such tax incentives for  oil companies. [If one is concerned about getting sucker punched, look at ObamaCare.]
“They can either vote to spend billions of dollars more in oil subsidies that keep us trapped in the past. Or they can vote to end these taxpayer subsidies that aren’t needed to boost oil production so that we can invest in the future,” Obama said. “It’s that simple.” [His answers are always simple. And wrong.]
Less than an hour later, Republican senators were joined by a handful of Democrats in the senate to reject a bill that would do just that. They argue it would raise gas prices even more. The “Repeal Big Oil Tax Subsidies” bill failed to advance by a vote of 51-47. It needed 60 votes to overcome a procedural hurdle. [I believe there are 45 Republicans. Something tells me that if push came to shove, more votes could have been found to kill this bill.]
And then, I suppose, he went golfing.
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ENB and HES Hit One-Year Highs Today

ENB and HES both hit a one-year high today. I'm sure others did, also. I just happened to catch these. Other Bakken-related companies have flirted with new highs in the past week.

This is reason for Hess action today: Hess sells Russian assets to Lukoil. Investor's Business Daily is reporting:
Hess shares rose more than 3% in the stock market today a new intraday high. Hess shares gapped up 9% in late January after the company reported strong earnings and jumped up again in mid-March after Elliott Management, headed by activist investor Paul Singer, raised its stake in Hess to 4.39%.
Hess shares have risen 37% this year as it exits the volatile refining business to focus on more profitable exploration and production.
For investors only, Part I of a two-part series on midstream opportunities, at SeekingAlpha.
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EPA Will Move To Increase Price of Gasoline to Be More in Line With European Pricing

This was reported last Friday: EPA will move to increase the price of gasoline to make it more in line with Europe and South Korea. Oil & Gas Journal is reporting:
US refiners would need to lower the sulfur content of gasoline to levels in place in Europe and elsewhere under a Mar. 29 proposal by the Environmental Protection Agency aimed at aligning federal regulations with those in effect in California.
The agency’s Tier 3 regulations call for a reduction in gasoline sulfur content to 10 ppm from a present average of 30 ppm. They also call for cuts in vehicle tailpipe and evaporative emissions in a package EPA said would move federal requirements toward strict standards in effect in California.
The proposed sulfur limit matches that of “Euro 5” gasoline in Europe. Comparable standards are in effect in Japan, South Korea, and several other countries, as well as in California. EPA said its Tier 3 proposal “is harmonized with the California Air Resources Board Low Emission Vehicle program so automakers could sell the same vehicles in all 50 states.”
In earlier reporting, it was estimated this would add only 9 cents/gallon and it would be passed on to the consumer. 
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GMXR Files For Bankruptcy Protection

Directly from my "snapshot" of GMXR (undated notations in some cases)
  • for investors, a reverse stock split in January, 2013
  • 34,918 acres (June, 2012, corporate presentation)
  • 35,524 (Enercom Conference, August 16, 2011) (new acreage at $2,500/acre)
  • Previously: 26,087 net acres (North Dakota and Montana)
  • New acreage a bit more southwest of original acreage, Billings County 
  • Bakken avg: 1,390 boepd; McKenzie County avg: 1,660 boepd
  • Planning to sell some Niobrara acreage; all CAPEX directed to Bakken; 
  • Entered the Bakken in early 2011; first rig scheduled for Sept 2011; second rig, Mar 2012
  • For investors, note: an $83 stock in 2008; now a $2 stock; a natural gas company trying to re-orient to liquid
  • This may be a more interesting company than I first gave credit; it was mostly a natural gas company; then said it was coming into the Bakken; to me it looked like GMXR was using the "Bakken" to attract venture capital; in fact GMXR has been very, very aggressive new permits, activity; I am pleasantly surprised. 
The AP is reporting:
Oil and gas producer GMX Resources Inc. said Monday that it filed for Chapter 11 bankruptcy protection, blaming low prices for natural gas.
The Oklahoma City company filed in the Western District of Oklahoma. The filing includes its Endeavor Pipeline and Diamond Blue Drilling units. It does not include Endeavor Gathering LLC, a business in which GMX holds a 60-percent interest.
GMX says it agreed to sell its operating assets and undeveloped acreage to the owners of company senior notes that are due in 2017. Those assets will later be subject to a public auction.
It will be interesting to see how this plays out: whether the new owners will form an LLC to continue operating in the Bakken or if they will simply sell the acreage to another Bakken-centric company. I assume those are two of several options. "Anon 1" predicted this outcome, a bankruptcy, some time ago.

I have a long history with GMXR. Before GMXR was in the Bakken I received a phone call from an East Coast media company -- it might have been the Wall Street Journal, I forget -- asking what I knew about GMXR and the Bakken. I had never heard of GMXR before and knowing how expensive it was to drill, I thought it would be a challenge for a new company that was not on my radar scope.

However, unlike "anon 1" I thought GMXR might succeed, but I was wrong. Sad to see. It is important for newbies to see that this had less to do with the Bakken and more to do with the price of natural gas. Chesapeake can relate.
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First Solar Buys 150-MW Solar Gen 2 Project in California

Updates

April 2, 2013: Zacks also not sold on First Solar. Reporting:
Currently, the company is working on a major restructuring plan to counter the continuous drop in margins. The fall in margins came in the wake of a precipitous drop in Average Selling Prices due to a supply glut in the market. We also remain concerned about the current macro scenario which does not bode well for solar energy producers who thrive mainly on subsidies and grants. The company presently retains a short-term Zacks Rank #3 (Hold).
April 2, 2013: an investor's opinion on the deal, at SeekingAlpha.
Original Post

If I recall, Enbridge has a sizable stake in First Solar, although that could have changed. Be that as it may, Bloomberg is reporting:
First Solar Inc.  bought the 150- megawatt Solar Gen 2 project in California from an affiliate of Goldman Sachs Group Inc., Energy Power Partners and a third unnamed partner.
Construction is expected to start this year and the project will be done in 2014, Tempe, Arizona-based First Solar said in a statement today. 
Sempra Energy (SRE)’s San Diego Gas & Electric utility will buy power from Solar Gen 2 under a 25-year agreement.
First Solar said 40 megawatts of solar modules from another supplier were already purchased and will be used on the project. First Solar will supply the rest. 
Good news for all. Shares of ENB rose today: either the deal had no impact on ENB or ENB/First Solar was buying solar cheaply.
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The Status Of A Carbon Tax In The United States -- For Archival Purposes Only

The LA Times is reporting:
In case there was any doubt about the odds of Congress enacting a carbon tax, a Senate vote Saturday morning showed that they are long indeed.
Sen. Sheldon Whitehouse, a liberal Rhode Island Democrat, offered an amendment to the proposed fiscal 2014 budget resolution calling for "establishment of a fee on carbon pollution." The amendment didn't suggest who'd pay the fee or how large it would be; it required only that the fee not increase the deficit and that all the revenue raised be "returned to the American people in the form of federal deficit reduction, reduced federal tax rates, cost savings or other direct benefits."
The big tent notwithstanding, the Senate rejected the amendment handily, 58 to 41. All 45 of the chamber's Republicans voted against it, as did 13 Democrats from energy-producing or swing states.
The writer failed to understand the reason for the amendment and the vote. Harry Reid doesn't bring measures to the floor without a reason.
In this case, they all knew the measure would fail. They wanted to see by how much and who would vote against it.

If the vote was close, let's say one or two votes, it easily could have been attached to a larger bill that would pass regardless of a carbon tax amendment.

If the vote was 80-20 lopsided, then it becomes very problematic to attach it to any bill.

However, a 58-41 vote? Only 8 senators need to get something in the main bill to make it worthwhile to vote yes on that bill even if there is a carbon tax amendment, particularly if the carbon tax is revenue-neutral as they say, and/or if the money goes directly back to the 47% of the population that would never vote for Mitt Romney.

The question: how would Senator Heitkamp vote if the measure was attached to another bill. This article may provide a clue. This vote over the weekend was a symbolic vote and it was a win-win for Senator Heitkamp. She could endear herself to those who support the North Dakota oil boom knowing that the vote was for show only.

The old "I voted against it before I voted for it" explanation. We've seen that movie.

I can't find the Saturday Roll Call, but this link is a pretty accurate reflection. 
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How "Talking Heads" See Energy Sector Changing -- For Archival Purposes Only; This Really Is Quite Incredible: China Bigger Oil Importer Than The US

CNBC is reporting:
Without fanfare, China passed the United States in December to become the world's leading importer of oil-the first time in nearly 40 years that the U.S. didn't own that dubious distinction. That same month, North Dakota, Ohio and Pennsylvania together produced 1.5 million barrels of oil a day--more than Iran exported. [Maybe Jane Nielson needs to read this article. Incidentally it looks like Jane gave up; her most recent post is dated July 23, 2012, and it includes Part IV of a five-part series. No Part V was posted at her blog unless I missed it.]
By the way, the photo at the linked article has this caption: "Oil pumpjacks are seen during sunrise in Williston, North Dakota March 14." The pumpjacks probably look the same today. What intrigues me about the photo is that the North Dakota landscape has not changed one bit despite the Bakken boom -- except for two pumps, which are less obvious and less noisy than a pair of wind turbines. Just saying.

Three takeaway points from the linked article:
  • energy focus shifting back to the western hemisphere (we've talked about that before)
  • consumption focus shifting from Europe to China (we've talked about that before)
  • Mideast could become more unstable due to local unrest
What was not mentioned is almost deafening:
  • Do a word search for "Germany" and the word shows up once ("... a former Iranian ambassador to Germany .."
  • Do a word search for "Russia": the word comes up three times:
1) oil less than $110/Brent barrel will barely meet Russia's budget requirements
2) Russia, as in BRIC (Brazil, Russia, India and China) when examining future of Mexico
3) its near monopoly on natural gas exports to Europe (Gazprom)
Only once does the reference to Russia have anything to do with energy, and it's almost irrelevant.

Two things come immediately to mind. I had forgotten that the "R" stood for Russia. Wow. Even Turkey is not considered a BRIC. Communism set Russia back 100 years and it looks like the country will never recover. But I digress. If Russia is a BRIC it can pretty much be ignored for purposes of this discussion.

So, back to Germany. And that takes us back to article linked earlier: Why Only Obama Can Save Europe, Now, written by the President, MSI Global, at CNBC.
When U.S. President Barack Obama looks at the dangerous euro wasteland that once was a prosperous region driving nearly one-fifth of the world economy, he probably has flashbacks of repeated rebuffs he got from German Chancellor Angela Merkel when, in late 2011, he asked for more economic growth and less austerity.  
Whether more spending and less austerity is/was the answer, the fact is that Germany is in deep trouble. And if Germany is in deep trouble, where does that leave the rest of Europe (perhaps excluding Great Britain)?
Indeed, just four days before the Holy Week came this heartbreaking report from Caritas (one of the world's largest humanitarian organizations): more than 3 million people in Spain currently live in extreme poverty (families with an income of less than $390 per month), and more than one million are barely surviving on charitable donations – an increase of 150 percent from the pre-crisis levels.
One can debate and discuss all the reasons Germany is in trouble, but among them is their attitude toward energy: no fracking, no nuclear, back to coal. At least coal is cheap. The Germans may come roaring back, but in the meantime, Canada and the United States are turning their attention more and more to China.
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North Dakota #3 in Wind Power; The EPA To-Do List Updated

Nice review of possible Obama order to kill the domestic nuclear industry: nuclear power vs wind power.

The article includes an update of wind energy in the US. North Dakota is #3, behind Iowa and South Dakota. The data comes from the American Wind Energy Association.

I hope these are still photographs 'cause the blades aren't turnin':

Wind Farm, Dickey County, North Dakota, December, 2012

Dickey County is in the southeast corner of the state, bordering South Dakota. With about 6,000 people, it has a population density of about 5 people per square mile.

March 8, 2014: because the Dickey County video above was removed, a new one in its place:

Wind Tower Fail


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Back on November 9, 2012, I posted the EPA To-Do Checklist:
Rough draft:
✓ Permitorium in the Gulf of Mexico
✓ Delay drilling in the Arctic another year (repeat annually)
    Double CAFE standards five years earlier than current timetable
    Increase penalties for migratory bird kills
✓ Unlimited waiver of liability for wind turbines (migratory bird kills)
✓ Confirm tortoises have been relocated (solar farms)
    Increase emissions standards on coal plants
✓ Close 90% of federal land to further oil shale exploration (think sage grouse)
    Federal regulation of hydraulic fracking on state land
    Ban all hydraulic fracking
✓ Kill Keystone XL 1.0
    Re-define "clean coal": [kleen kohl], noun, mythic fossil fuel found only in Australia and China
    Ban export of coal
I need to update the EPA to-do checklist.

Revised draft, #2:
✓ Permitorium in the Gulf of Mexico
✓ Delay drilling in the Arctic another year (repeat annually)
    Double CAFE standards five years earlier than current timetable
    Increase penalties for migratory bird kills
✓ Unlimited waiver of liability for wind turbines (migratory bird kills)
✓ Confirm tortoises have been relocated (solar farms)
    Increase emissions standards on coal plants (that's being worked (March, 2013)
✓ Close 90% of federal land to further oil shale exploration (think sage grouse)
    Federal regulation of hydraulic fracking on state land
    Ban all hydraulic fracking
✓ Kill Keystone XL 1.0
    Re-define "clean coal": [kleen kohl], noun, mythic fossil fuel found only in Australia and China
    Ban export of coal
    Destroy the US nuclear power industry
    Executive order requiring all energy permits to meet international standards
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Speaking of destroying the domestic coal and nuclear industry, it looks like we only have to look to Europe to see where we will be ten years from now (if not sooner) if all this progressive thinking continues. One can take bits and pieces away from this article, but the problem with Europe, in addition to everything everyone always talks about: Europe doesn't know how to manage its energy assets.
Indeed, just four days before the Holy Week came this heartbreaking report from Caritas (one of the world's largest humanitarian organizations): more than 3 million people in Spain currently live in extreme poverty (families with an income of less than $390 per month), and more than one million are barely surviving on charitable donations -- an increase of 150 percent from the pre-crisis levels.
 
And there seems to be no end to this, Chancellor Merkel says that at least five more years are needed to put this horrible human suffering behind. But five years sounds like a short time to produce a German euro area. And a more important question is whether that objective can be achieved without tearing apart the social fabric already stretched to the breaking point in France, Italy and Spain - to say nothing of smaller countries like Greece, Portugal, Ireland, Cyprus, Slovenia, etc.
For the U.S., the euro area chaos is not just an issue of bleak outlook for one-fifth of American exports going to Europe. It is a question of political stability of its key ally and a pillar of the largest and, arguably, the most successful military alliance in history.
 Google "energy" in the linked article. The word does not appear. "The most successful military alliance in history" is now a paper tiger. Spain's extreme poverty: Spain can thank their wind and solar renewable program for much of their problems. Germany is going to have a major problem with energy: won't frack; won't nuke; back to coal. "For the US, the euro area chaos is not just an issue of bleak outlook for one-fifth of American exports going to Europe....." Folks, get real. The world is changing. The shift is moving to China. And it could happen faster than folks realize.

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I can't make this stuff up. President Obama proclaims the month of April to be the month to teach young people how to budget responsibly:
President Barack Obama, who has increased the national debt by $53,377 per household, has proclaimed April “National Financial Capability Month,” during which his administration will do things such as teach young people “how to budget responsibly."
“I call upon all Americans to observe this month with programs and activities to improve their understanding of financial principles and practices,” Obama said in an official proclamation released Friday.
Let's get real, folks.
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The Bakken: The Rail Revolution -- Everything Investors Need To Know -- SeekingAlpha

Active rigs in North Dakota: 188 (very, very nice)

The Bakken: the rail revolution -- everything investors need to know -- Richard Zeits, SeekingAlpha, I thought this had already been posted some time ago, but here it is again.
2013 is shaping up as a strong year for the Bakken, in contrast to 2012 when the play was hurting from skyrocketing drilling and operating costs, severe infrastructure bottlenecks, exploding basis differentials, and disappointing economics, forcing some operators to scale back their drilling plans.
Looking forward, several positive factors are at work that should filter through to favorable year-on-year financial comparisons and contribute to a brighter outlook for the play in general: Crude oil takeaway issues have been largely resolved, with ample rail availability and major pipeline capacity additions expected in 2014-2016.
Natural gas and NGLs should become increasingly bigger contributors to operators' bottom lines as the build-out of processing and pipeline infrastructure is beginning to bear fruit and should catch up with production within next two years. Deeper Three Forks exploration is gaining momentum in 2013 and may quickly transition from a geological concept to proven reality, adding a large new dimension to the play.
Continental Resources  is ramping up an aggressive Deeper Three Forks exploration program, now with 15 additional TF2, TF3 and TF4 tests planned for the year (on top of four successful wells to date). Kodiak Oil & Gas  has initiated two multi-well pilots that include TF2 testing. Tests by other operators will likely contribute many additional data points.
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19 Degrees In Minneapolis Tonight -- It's Springtime in Minnesota

This is what happens when you try to slow down global warming way too fast. Nineteen degrees tonight in Minneapolis -- that's thirteen degrees below freezing. And this is April. Spring. Right now it's 21 degrees with a wind chill of 9 degrees. Brrrrr!!

I would not have noticed -- nor cared -- but Don reminded me that tonight was the Minneapolis Twins opener at Target Field, this afternoon, when it will be warmer:
Fans who are going to the game will definitely need to bundle up. Game time temperatures are expected to be in the low to middle 30s, and with the wind it will feel like it’s in the 20s.
“I know in colder weather states like Minnesota everybody’s ready to get out and watch some baseball outdoors but it’s still a little chilly for my liking,” said Twins player Chris Parmelee.
This would be a good game to simply start at the top of the 8th inning, and call it a game. A tie at the bottom of the 9th? Flip a coin. I can guarantee you this game will have no bearing on the World Series, about a year from now.

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And, y'all knew I was going to post this, didn't you?

When It's Springtime in Alaska, Johnny Horton
I can see Russia out my backdoor -- Bartlett's Familiar Quotations.
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Bakken Rail Update -- Must Read; Other Investment Notes On a Very Slow Monday Morning; Don't Read; It's Just Filler

 Market: mid-morning: S & P has pulled back almost 8 points; Dow down 30 points; and oil down $1.20

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

Market opening after the long weekend:
  • Profit taking in oil, but off its low. Down about a buck today.
  • The Dow essentially flat, but green if anything.
  • S&P still above the 2007 high, but down a bit from last week; it's a struggle.
Companies I enjoy following, regardless of whether I am invested in them:
  • ENB: hit a new high at the opening; $46.75; its operator EEP, down a bit
  • EOG: down a bit
  • CLR: down minimally; it's been getting some good press lately, despite ...
2013 is shaping up as a strong year for the Bakken, in contrast to 2012 when the play was hurting from skyrocketing drilling and operating costs, severe infrastructure bottlenecks, exploding basis differentials, and disappointing economics, forcing some operators to scale back their drilling plans. Looking forward, several positive factors are at work that should filter through to favorable year-on-year financial comparisons and contribute to a brighter outlook for the play in general:
  • Crude oil takeaway issues have been largely resolved, with ample rail availability and major pipeline capacity additions expected in 2014-2016.
  • Natural gas and NGLs should become increasingly bigger contributors to operators' bottom lines as the build-out of processing and pipeline infrastructure is beginning to bear fruit and should catch up with production within next two years.
  • Deeper Three Forks exploration is gaining momentum in 2013 and may quickly transition from a geological concept to proven reality, adding a large new dimension to the play. Continental Resources is ramping up an aggressive Deeper Three Forks exploration program, now with 15 additional TF2, TF3 and TF4 tests planned for the year (on top of four successful wells to date). Kodiak Oil & Gas has initiated two multi-well pilots that include TF2 testing. Tests by other operators will likely contribute many additional data points.
  • T: up nicely.
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For Investors Only

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here, or what you think you read here. See welcome/disclaimer to understand why I post this data at the blog.

From CNBC last Thursday, the last trading day before the long weekend:
The S&P 500 moved above its October 9, 2007 record closing high of 1,565.15 early in the session. The best performing stocks in that index this year include Netflix, up over 100-percent year to date, Best Buy and Hewlett-Packard.
Biogen Idec was the best performing stock on the S&P 500. Several analysts raised price targets on the global biotechnology company after it received FDA approval for a new multiple sclerosis treatment.
The best-performing S&P sector was utilities, with Oneok the top stock.
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1Q13 Earnings

All 1Q13 earnings will be reported at this page; link will be on sidebar at the right, under "Earnings Central." When we start to see earnings reports for any quarter, the "Earnings Central" link is moved to the top of the sidebar until the earning seasons is over.

I don't have time to check/update earnings on all companies listed below. If you see one that I have missed, feel free to send it in (anonymous comment or by e-mail) and I will post it.

Comment:

Miscellaneous articles:
  • If there were warnings out there, I did not see them for this quarter
General update:

Alcoa: beats; shares up almost 2%. Forecast: 8 cents, down 20% from last year; sales at $5.88 billion, down 2% qoq; some said $5.91 billion. Actual: 11 cents; revenue, $5.83 billion. The market liked what they saw; the whisper numbers might have been worse.



EPS estimates in parentheses following the ticker symbol (according to Yahoo!Finance)

AXAS: May 6

BAX (1.04 ): in-line; $1.00; maintains guidance;

BCEI: misses by 2 cents; press release; Niobrara; Z-Man on BCEI -- an apologist for the company; says he will considering buying more on pullbacks; 

BEXP: see STO below

BHI (0.63):  beats by 2 cents; 65 cents;

BK ( ): 

CHK ($0.25): earned 2 cents vs a lot of 21 cents last year; Chesapeake said it had a profit of 30 cents a share on revenue of $3.42 billion, beating analyst expectations for profit of 25 cents a share on revenue of $2.85 billion.

CLNE: 

CLR ($1.13 ): press release and earnings transcript; $1.17; met expectations on revenue; exceeded earnings per share.

CNP (37 cents):  misses, 34 cents; transcript; 

COP ( ): $1.73 vs $2.27 a year ago; in line, but 3% production drop is a concern;

Crescent Point:

CRR (90 cents): misses by 14 cents (76 cents)

CVX ($3.07): $3.18; April 26; warning -- production decline; Analysts expect Chevron to earn $3.09 a share in the first quarter, down from $3.27 a share a year earlier. Beats estimates but mixed report; pre-market seems to like what it saw;

DNR: press release; beats by 4 cents; increased average quarterly oil production from tertiary operations to a new record level of 39,057 barrels per day, 17% higher than 2012's first quarter level and 4% higher than the fourth quarter of 2012 level.

DVN: 

ECA: beats by 16 cents; earnings conference call;

EEP (18 center): 21 cents; beats; transcript;

ENB: 

EOG:  huge; transcript; on the morning following the earnings report, EOG jumped $11 from $125 range to $136 range

EPD ($0.65 ): $0.67.  Net income up 16%; earnings increased 14%. At Wall Street Cheat Sheet: EPD delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

ERF: 

GEOI (bought by Halcon [HK], below)

GMXR:

HAL ( ):  67 cents;  

HES ( ): transcript; easily beats, $1.95 vs $1.59; it's all about the Bakken; incredible conference call; 

HP ( ):

HK (Halcon; previously GEOI): 

Kinder Morgan - KMP ( ): 

KOG:  Press release here. Transcript.
For the first quarter 2013, the Company reported net income of $19.4 million, or $0.07 per diluted share, compared to net income of $1.7 million, or $0.01 per diluted share, for the same period in 2012.  Net income for the first quarter 2013 includes an unrealized loss of $17.2 million related to the mark-to-market of derivative instruments used for commodity hedging.  The net effect, after-tax, of the non-cash hedging activities decreased Kodiak's reported net income for the first quarter 2013 by $0.04 per basic and diluted share.
Legacy/Bowood: 

LINE:

MDU ($0.23):  30 cents; a reader summarized it up nicely -- You could say they BLEW away the qtr. $889.3 was consensus operating rev, and MDU reported a $931.6 op rev. Consensus was .23 for earnings with a .19 low to a .26 for a high number MDU reported a  .30 cents per share profit. Also increased the entire yr from $ 1.15 approx. to $ 1.30- to $ 1.40.

MMR (McMoRan) ( ): 

MPC (Marathon Petroleum) ( ): 

MRO (Marathon Oil): 54 cents vs 72 cents forecast, Reuters; press release;

MUR ( ):

NBL ($1.25): Noble Energy beats by $0.23, beats on revs: Reports Q1 (Mar) earnings of $1.48 per share, $0.23 better than the Capital IQ Consensus Estimate of $1.25; revenues rose 5.1% year/year to $1.14 bln vs the $1.09 bln consensus.

NBR:  

NFX: beats by a penny; 6 cents;

NOG: 29 cents; the market likes the number;

NOV: misses by 8 cents -- shares fall a couple of bucks.
Natl Oilwell Varco misses by $0.08, misses on revs : Reports Q1 (Mar) earnings of $1.29 per share, excluding non-recurring items, $0.08 worse than the Capital IQ Consensus Estimate of $1.37; revenues rose 23.3% year/year to $5.31 bln vs the $5.37 bln consensus.

OAS: beats by 5 cents; beats on revenue; press release;

OKE: misses by 6 cents; transcript; reported first-quarter 2013 earnings per share of 54 cents, missing the Zacks Consensus Estimate by 4 cents. However, quarterly earnings increased 5.9% year over year primarily on higher natural gas volumes collected and processed and natural gas liquids volumes gathered in the Williston Basin.

OKS:  

OTTR: a great quarter; press release;

OXY ( ): earnings call;
PAA:  

PSX ( ):  

QEP: 

RIG ($1.00): 88 cents but phenomenal quarter; transcript;

SD: 

SLB (0.99): beats by 2 cents; $1.01/share; will pop to $88 when earnings reported -- Forbes.

SM ($0.58): $0.82. Beats by $0.24, beats on revs: Reports Q1 earnings of $0.82 per share, excluding non-recurring items, $0.24 better than the Capital IQ Consensus Estimate of $0.58; revenues rose 28.3% year/year to $484.2 mln vs the $461.3 mln consensus. Q1 production was 10.35 mmboe with average daily production of 115.0 mboe/d. Co sees Q2 production of 10.5-11.0 mmboe, with average daily production of $115-121 mboe/d. Co sees FY13 production of $42.8-44.5 mmboe with average daily production of 117-122 mboe/d.

SRE ($1.02): misses but revenues beat; press release; hits new high, then falls back; first-quarter 2013 earnings of $178 million, or $0.72 per diluted share, compared with $236 million, or $0.97 per diluted share, in the first quarter 2012.  First-quarter 2013 earnings included a one-time charge for income tax expense of $63 million related to a reorganization in connection with the initial public offering of Sempra Energy's Mexican subsidiary. Others say: Sempra Energy reported adjusted EPS income of $0.99 per share. By that measure, the company missed the mean analyst estimate of $1.02. It beat the average revenue estimate of $2.38 billion.

SRGY:

SSN:

STO (BEXP): transcript;

STR: earnings press release; 

T (64 cents ): 67 cents; WSJ story;

TPLM: beats by 5 cents; stock jumps 10%; earnings call; downspacing revolution in the Bakken;

UNP (1.96): record first quarter; $2.03

USEG: 

VLO: 

VOG: 

WFT: press release; first quarter 2013 revenues of $3,837 million with net income of $117 million, or $0.15 per diluted share, excluding after-tax losses of $95 million. On a GAAP basis, our net income for the first quarter of 2013 was $22 million, or $0.03 per diluted share.

WHX:  

WHZ:

WLL:  beats by 4 cents; Whiting Petroleum beats by $0.04, beats on revs: Reports Q1 (Mar) earnings of $0.94 per share, excluding non-recurring items, $0.04 better than the Capital IQ Consensus Estimate of $0.90; revenues rose 8.8% year/year to $613.4 mln vs the $590.09 mln consensus.

WMB: 23 cents vs 24 cents forecast; lowers guidance; press release;

WPX (-23 cents): WPX reported an unaudited net loss from continuing operations attributable to WPX Energy of $116 million for first-quarter 2013, or a loss of $0.58 per share on a fully diluted basis, compared with a net loss of $41 million, or a loss of $0.21 per share, in the same period a year ago.

XOM: beats, increases dividend;

 XLNX (45 cents): 47 cents, beats; transcript;
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Earnings Central

For investors: investing.

Earnings by quarters.
Annual reports.
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Monday Morning Links

Wells coming off the confidential list this long weekend have been posted, click here.

RBN Energy: Too good to be true. If you are pressed for time, don't read the article. Don't say I didn't warn you.

WSJ Links

Only three sections on Monday.

Section C (Money & Investing):
Coal is in retreat in the U.S., with demand down by about a fifth in the past five years. It isn't tough to see why. More than 90% of coal gets burned to produce power. Electricity use is down 2% over the past five years, and as the shale boom has made natural gas more competitive, coal's share of power production fell to 37% last year from 49% in 2007. Tightening emissions standards also favor gas over coal.
Little wonder, then, that many coal plants struggle with losses, and some now change hands at prices that even the phrase "fire sale" would flatter. But this could signal the market has bottomed out.
 A fire sale:
In early March, Dominion Resources sold three power plants totaling 4.1 gigawatts of capacity to Energy Capital Partners, a private-equity firm. 
After stripping out tax benefits, the implied underlying price paid per kilowatt of capacity was just over $100. In contrast, the Department of Energy estimates the cost of building a new coal-fired plant at about $3,000 per kilowatt—assuming you could even get the permission and funding to build one.
 Section B (Marketplace):
Section A
  • US steps up show of force in Korea: no link; stories everywhere
Afghanistan's Karzai seeks Qatar's help on peace talks with Taliban:
Afghan President Hamid Karzai traveled to Qatar in a bid to revive Afghanistan's faltering peace process and patch up relations with the wealthy Gulf emirate where the Taliban are establishing their main negotiating headquarters.
The US is quickly and quietly pulling out of Afghanistan; huge convoys moving south through Pakistan to port. Karzai has to feel a bit nervous. Bit the hand that fed him. After all the money and lives spent in Afghanistan, it looks like Karzai will ally with the Taliban. Years ago, I posted that likely outcome based on one National Geographic photograph. At least I think it was National Geographic. Wherever it was, it was a photo of Afghanistan's freedom fighters, the Taliban. The writing was on the wall, or should we say, the turban.

Op-Ed: nothing.

Wow, a pretty dismal issue.
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