Tuesday, September 3, 2013

Twenty (20) New Permits -- The Williston Basin, North Dakota, USA; Several Wells Coming Off Confidential Status; 2/7 To DRL Status; Nothing Exciting; OXY USA With Another OXY USA Well

Active rigs: 186 (trending higher)

Twenty (20) new permits --
  • Operators: QEP (8), XTO (4), Whiting (3), OXY USA (2), Corinthian, Hess, Hunt
  • Fields: Sanish (Mountrail), DeMores (Billings), Northeast (Bottineau), Lone Tree Lake (Williams), Delhi (Golden Valley), Heart Butte (Dunn), Boxcar Butte (McKenzie), Crooked Creek (Dunn), Garden (McKenzie), Russian Creek (Dunn),
  • Comments: It appears QEP's permits for 8 wells are all in the same section, 28-148-92, Heart Butte,
Wells coming off confidential list were posted earlier; see sidebar at the right.

Section 28-148-92 reminds me of all the QEP wells in section 31-148-92.  There are, I believe, 17 wells sited in this one section.

Wells coming off the confidential list, Wednesday:
  • 23506, drl, HRC, Fort Berthold 152-93-17D-08-6H, Four Bears, no production data,
  • 23685, 225, OXY USA, Meduna Trust 1-7-6H-142-94, Murphy Creek, t3/13; cum 12K 7/13;
  • 23742, 859, Fidelity, Hank 28-33H, Stanley, t3/13; cum 40K 7/13;
  • 24689, 575, Hess, BW-Sharon 150-100-2536H-2, Timber Creek, t712; cum --;
  • 24713, 637, Hess, EN-Hein S 156-94-1201H-5, Big Butte, t7/13; cum 14K 7/13;
  • 24791, conf --> loc, KOG, Smokey 16-7-19-16H3M, Pembroke, no production data;
  • 24946, drl, QEP, Lawlar 1-5-8BH, Grail, no production data;
With regard to #24791, I was told by folks elsewhere that permits did not go from "conf" to "loc" or back to "conf" once take off the list. I may have misunderstood. I misunderstand a lot of things. 

Disclaimer: I often make typographical errors; if alerted to mistakes I will correct them. Adjectives describing wells are my own adjectives and such adjectives are in the eye(s) of the beholder.

A Note To The Granddaughters

In an earlier note, I mentioned that of all the places I've lived or visited, the place I still miss is San Antonio.  A reader sent me this video. This is SOOOOOOO San Antonio. My father-in-law, Flavio, Sr, was Hispanic. His father came across the river many decades ago and was returned to Mexico, but his family stayed on, first in Beeville, TX, and then some of the family to San Antonio. The individual in the linked video reminds me of all the wonderful memories I have of my father-in-law. He, too, made the military a career, including one tour in Korea, and two tours in Vietnam. He also caught the tail-end of WWII so he was one of the few veterans that had "four wars" on his US Army veteran's ball cap. 

Natural Gas Transportation: Some Random Data Points

Some random data points.

Price of natural gas to consumer for transportation (rounding):
  • US: $3.50 / million BTU
  • China: $14.40 / million BTU
Number of vehicles using natural gas (rounding):
  • US: 135,000
  • China: 1.5 million (up 50% year-over-year, 2012)
It is what it is.

The nice thing is that investors don't have to be upset the US is not so forward thinking. Investors can easily invest in companies that trade on the New York stock exchanges and are doing energy business in China.

See the linked article for some suggestions.

Disclaimer: this is not an investment site. Do not make any investment decisions on anything you read here or what you think you may have read here.

Around The Horn

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here. 

KOG hits a new high ($10.22), up a couple of pennies.

Oasis up slightly.

CVX, COP, XOM: all up slightly.

EOG up nicely; up almost $2.00; 1.25%; fracking improved our national security more than the Department of Defense -- Motley Fool.

CHK is up, flirting wit new highs; but SD up slightly; SD continues its nice run, up about 1.3%.

UNP down a bit.

I don't follow BNSF (BRK) much any more; BRK follows the market in general.

ENB, EEP both down slightly.

SRE, TransCanada: both down about a percent.

Market relatively uninteresting early in the trading day. Oil is firming; market is skittish over Syria.

Having said that, from Seeking Alpha:
  • UBS highlights top energy stocks to buy that could benefit from the current Middle East situation.
  • UBS expects the large integrated oil companies, including Exxon Mobil and Chevron, to benefit from the increase in oil pricing, even if it is temporary.
  • While E&P companies are more sensitive to changes in commodity prices than the majors, they also may have the most upside potential among energy stocks; the firm focuses on DVN, EOG, and Whiting.
  • UBS would hold names in the oil services group through the period and buy on any dip: BHI, HAL, SLB.
  • Refiners are at a disadvantage as oil prices rise and better off when prices fall, so UBS would focus on other areas for now.

Tuesday Morning News, Links, And Views -- Part III

For the life of me, Microsoft buying most of Nokia makes no sense. Except for Nokia. Thank goodness for them, a white knight came riding by. Meanwhile, Apple knows what it is doing: it's iPhone fingerprint reader means government contracts. [Later: ah, here it is, why Microsoft "HAD" to buy Nokia -- Nokia was getting ready to quit selling Microsoft phones. Wow. Microsoft is now in the phone business making its own phones, just like iPhone, I guess.] This graph about says it all.

WSJ Links

Crude oil supported by encouraging data coming out of China
Crude oil turned positive and gold pared overnight losses in London on Monday as encouraging economic data from China provided a tailwind for prices. 
Long-term jobless left out of the recovery
More than four years after the recession officially ended, 11.5 million Americans are unemployed, many of them for years. Millions more have abandoned their job searches, hiding from the economic storm in school or turning to government programs for support. A growing body of economic research suggests that the longer they remain on the sidelines, the less likely they will be to work again; for many, it may already be too late.
By most conventional measures, the U.S. economy is healing, albeit slowly. Gross domestic product grew at a 2.5% rate in the second quarter of the year, the government said last week, the best pace since last fall. Payroll figures, due Friday, will likely show that hiring held steady in August. The housing market is rebounding, corporate profits are strong, and households are repairing their balance sheets.
Op-ed: the politics of the Obama  delay on Syria
The most telling line in President Obama's Saturday Syria address came near the end, when he (once again) lectured Congress about its duty to rise above "partisan differences or the politics of the moment." Having put America's global credibility at risk, Mr. Obama defaulted to the same political cynicism that has defined his presidency.
The commander in chief is in a box. His desperation to avoid military entanglement in Syria last year—in the run-up to the presidential election—inspired Mr. Obama to fumble out his "red line" warning to Bashar Assad on chemical-weapons use. The statement was a green light to the dictator to commit every atrocity up to that line and—when he received no pushback—to cross it.
Now trapped by his own declaration, Mr. Obama is reverting to the same strategy he has used in countless domestic brawls—that is, to lay responsibility for any action, or failure of action, on Congress. The decision was made easier by the fact that Congress itself was demanding a say. 
The writer provides a number of political aspects to the president's decision and finishes with what I think will be most fun to watch (Nancy Pelosi):
Finally, Mr. Obama is betting that the GOP rift will divert attention from the most pertinent aspect of this debate: the extent to which his own party abandons him. The president's withdrawal from the world stage—his exit from Afghanistan and Iraq, in particular—has nurtured the Democratic Party's worst instincts and left it even more resistant to a call for military action. Mr. Obama is counting on Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi to corral votes for him, but the liberal Democratic wing is not a sure bet.

Monday Morning Links, Views, And News -- Part II

It will be interesting to see if there is any follow up to this story today. Breitbart is reporting:
In what is being reported as a surprise move, the 40,000 members of the International Longshore and Warehouse Union (ILWU) announced that they have formally ended their association with the AFL-CIO, one of the nation's largest private sector unions. The Longshoremen citied Obamacare and immigration reform as two important causes of their disaffiliation.
The following is dynamic: Wow, talk about a RINO: even before seeing the final plan, Senator McCain is supporting President O'Bama's war plans, front page story above the fold in the New York Times.  So will Boehner. Maybe we all underestimated Mr O'Bama. It looks like this will be a slam-dunk for Mr O'Bama; Cantor has now said he will also support the president. It looks like it will be the Senate democrats that Mr O'Bama has to win over. If they fall in line, this vote could be over pretty quickly. It almost looks like Congress wants this off their plate as quickly as possible.

On another note, my reference to this being the Syrian Missile Crisis appears not to be far off. The Israelis launched a missile with no advanced notice, scaring the folks in the Mideast and the financial markets, until explanations were provided. Target practice.

Tuesday Morning Links, News, And Views -- Part I

Wells coming off the confidential list have been posted

Active rigs: 185

RBN Energy: the RBN Energy folks have had several essays on the CBR terminals being built in Texas/Louisiana to handle Canadian oil. This time the authors "will run through the operating or planned terminals outside the CN direct network that deliver to Mississippi Gulf refineries as well as equivalents on the Texas Gulf Coast in Houston and at Port Arthur. We have confined our survey to those facilities that are handling Canadian heavy crude or have expressed plans to do so."

Rigzone is reporting:
Exploration and production (E&P) companies with onshore U.S. operations need to better understand shale oil formations and to modify certain environmental health and safety (EHS) practices, and these goals are driving technology development among oilfield service companies, according to several members of the service company community.
"We're just in the infancy of our understanding" of shale oil plays, said Tim Ruble, a senior geochemist with Weatherford Laboratories in Houston. "Shale oil represents a much more complex system" than a shale gas formation, he noted.
Weatherford is developing technologies to generate three-dimensional, nano-scale models documenting exactly where the crude oil is present in a shale formation and is helping operating companies decipher the chemical composition and physical characteristics of the oil, Ruble said. The goal is to more clearly illustrate where oil resides, how oil moves within the rock and to provide data about the oil's maturity and API gravity – factors that can help operators to map out the optimal sweet spot for drilling. 
Note: shale oil represents a much more complex system than a shale gas formation. Several comments: I don't know how many times I've mentioned the Bakken has a been a huge laboratory  for shale oil exploration and production. Weatherford has had huge operations in the Williston area for decades. The challenge of shale oil exploration and production helps explain the consistently different results among Bakken operators. The best news: the recovery rates will keep getting better. 

The Billings Gazette has a small "snapshot" of Watford City.

It appears The Dickinson Press is scouring the nation's newspapers to find out what is going on Dickinson's backyard. Today it is an article from a Duluth, MN, writer. Again, the Minnesota writer has the geography wrong, but that's not unexpected. I assume the Duluth writer flew in by plane, using fossil fuels and emitting tons of CO2, and then drove around the oil patch in a gas-guzzling SUV. Whatever he/she used was not mentioned.

Staying in Debbie Downer mode, The Dickinson Press provides us a lengthy article on the increasing number of blowouts in the oil patch. Of course, only raw data was provided, and not a statistical analysis.  The reason for the high IPs in the Bakken has to do with the over-pressurization in some areas. Debbie Downer sees the glass half empty. I am impressed with the technology and the roughnecks that can manage this high pressure challenge. Over 800,000 bopd are produced in North Dakota each day and almost 200 wells are being drilled any give day. Eighteen of the 23 blowouts resulted in less than 10 bbls of fluid (salt water, crude oil) being released (230 bbls) though five of the 23 blowouts were bigger -- between 600 and 2,000 bbls of fluid being released. This, too, is an ankle biter.