Monday, October 28, 2013

Tuesday; Minimal Blogging Today And Next Few Days; Still Traveling

Active rigs: 183 (back up from 180 yesterday)

RBN Energy: another must-read article for those following the Bakken. I will have to read it later; I'm traveling and pressed for time.
With Brent premiums hovering close to $10/Bbl versus West Texas Intermediate (WTI) crude in the past month, the netbacks for Bakken producers shipping crude by rail to the East or West Coast are higher than they are for pipeline movements to Cushing or the Gulf Coast. Netbacks represent the crude price at the destination less transportation costs back to the wellhead. Today we show how the market destinations with the highest netbacks have reversed since July.
For investors, huge implications, but remember, this is not an investment site. I post these stories because it helps me understand the Bakken better and puts the Bakken into perspective. Do not make investment decisions based on what you read here or what you think you may have read here.

The Wall Street Journal

President Obama will now let the Senate write the rules for the NSA. Senator Feinstein will take the lead.  This should be fun.

Finally, a story on Syria: "Syria weapons inspections hit snag." Oh, really. Who wudda thought?

 Apple: Apple reported a third consecutive quarter of declining profits, but showed signs that both prices and profit margins are stabilizing despite heightened competition for its iPhone and iPad.

Burger King: Burger King's third-quarter earnings soared as the fast-food chain posted significantly fewer operating expenses and as same-store sales increased in its international regions.

Thirteen (13) New Permits -- The Williston Basin, North Dakota, USA; Petro-Hunt Has A Nice Well

Active rigs: 180 (trending down; could hit new low)

Thirteen (13) new permits -- 
  • Operators: QEP (4), XTO (3), SM Energy (3), Whiting (2), Hess (1),
  • Fields: West Capa (Williams), Robinson Lake (Mountrail), Grail (McKenzie), Poe (McKenzie), Hay Creek (McKenzie)
  • Comments:
Wells coming off the confidential list were posted earlier; see sidebar at the right.

Wells coming off the confidential list Tuesday:
  • 21725, 230, Petro-Hunt, USA 150-102-6A-7-1H, Foreman Butte, t7/13; cum 26K 8/13;
  • 24145, 2,447, XTO, Ester Federal 34X-28C, Lost Bridge, no production data, 
  • 24226, drl, Oasis, Neva Federal 5300 14-25T, Willow Creek, no production data,
  • 24262, drl, BR, Glacier 41-4TFH, Clear Creek, no production data,
  • 24359, 842, CLR, Mack 7-2H, Antelope; a "Sanish" well; short lateral; t8/13; cum 18K 8/13;
  • 24716, 797, OXY USA, John Kinne 1-27-34H-142-98, Snow, t4/13; cum 33K 8/13;
  • 24761, 1,957, Oasis, Gloria 5393 44-4B, Sanish, t7/13; cum 25K 8/13;
  • 24955, drl, SM Energy, Cade 12-19HB, Poe, no production data,
  • 24968, 505, Oasis, Sonora 6094 42-24H, North Tioga, t7/13; cum 10K 8/13;
  • 25227, drl, XTO, Koeser 41X-15C, Siverston, no production data,
  • 25279, drl, BR, CCU WIlliam 24-20MBH, Corral Creek, no production data;

21725, see above, Petro-Hunt, USA 150-102-6A-7-1H: 

DateOil RunsMCF Sold

24716, see above, OXY USA, John Kinne 1-27-34H-142-98:

DateOil RunsMCF Sold

 24761, see above, Oasis, Gloria 5393 44-4B, Sanish:

DateOil RunsMCF Sold

For Investors Only

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or think you may have read here. I include "for investors only" for archival purposes and to put the Bakken in perspective, as well as to learn more about the Bakken and where the activity is headed, as noted in my "welcome/disclaimer." I have no formal training and limited experience in investing as folks can readily surmise by reading this blog. I can tell you that gasoline is very expensive in Williston, North Dakota, approaching $3.70/gallon for the cheap stuff, while just  a few miles down the road, one can find the same grade of gasoline for $2.99 at Watford City. At least that's what I think the sign said. Here in Belfield, on the date this was posted, I am looking at a Cenex Superpumpers sign that says gasoline is selling for as low as $3.34 gallon. 

Had I been in an all-electric Volt Tesla (see first note below) today I would have been in trouble. I would have reached Watford City, but I did not see any charging stations there.

I see, today, that 26 companies announced they are increasing their dividends/distributions, including Summit Midstream Partners, SandRidge Permian Trust, Panhandle Oil, Martin Midstream Partners, Magellan Midstream, among others.

This doesn't sound good: LDK Solar enters new forbearance arrangement with noteholders: Co announces that it has entered into a new 30-day forbearance arrangement with holders of a majority in aggregate principal amount of its US$-Settled 10% Senior Notes due 2014. The new forbearance arrangement, which expires on November 26, 2013, relates to the interest payment due under the Notes on August 28, 2013. That interest payment is still unpaid. It is LDK Solar's intention to find a consensual solution to its obligations under the Notes as soon as possible and LDK Solar remains hopeful that it will be able to achieve that goal.

This doesn't sound good either:
Thousands of Californians are discovering what Obamacare will cost them — and many don't like what they see.
These middle-class consumers are staring at hefty increases on their insurance bills as the overhaul remakes the healthcare market. Their rates are rising in large part to help offset the higher costs of covering sicker, poorer people who have been shut out of the system for years.
Enough for now. Apple reports earnings today after the market close. I should be in South Dakota by then. 


Active rigs: 182

RBN Energy: the condensate dilemma, part 2, demand.
Supplies from the three main branches of the US condensate family are increasing faster than demand can keep up. Field condensate production from shale basins is nearing 1 MMb/d - headed to 1.6 MMb/d by 2018. 
Plant condensate – aka natural gasoline - will increase from just over 0.3 MMb/d in 2013 to more than 0.5 MMb/d in 2018. 
Because field condensates cannot be exported to overseas markets, more of this material will be refined traditionally or using a splitter – pushing out existing refinery demand for natural gasoline and creating an excess of naphtha range material. 
Petrochemical demand for natural gasoline has dried up in the face of cheap ethane feedstocks. Canadian demand for natural gasoline as diluent will soak up some but not the entire natural gasoline surplus. With US gasoline demand declining, the only outlet for excess naphtha and natural gasoline will be more exports (beyond Canada). Today we look at changing condensate demand patterns.
Hard to believe, huh?


 The Wall Street Journal

Lying, incompetent, or insubordinate subordinates? President O'Bama said he did not know that his government had been spying on our allies for the past three years (since 2010). Lotsa fun. Talk radio did note that President O'Bama did kill Osama bin Laden singlehandedly. I don't recall that. I only recall that he flew the first of two helicopters into the compound; Michelle was piloting the second helicopter. Don't quote me on that; it's just what I recall at the time. But that was a long time ago.

American cities' fiscal health lagging behind other sectors as recovery slowly takes place. I follow the fiscal health of troubled cities at Doomsday: US Cities.

Apparently Ms Sebelius outsourced the plan to multiple underlings. As it becomes clear that no sole leader oversaw the health law's online exchange, the accounts of more than a dozen current and former officials show how a disjointed bureaucracy led to the site's disastrous launch.

Well, this is great news for ObamaCare: Some states are signing up tens of thousands of new Medicaid enrollees in the initial weeks of the health law's rollout, while placing far fewer in private health insurance. Predictable.

No articles on Syria in the front section of the on-line edition.

Apple Inc will report earnings after market close today. Ahead of the Tape: Analysts covering Apple routinely aim too low in making their earnings estimates, but earnings "beats" don't translate reliably into stock-market gains. I can hardly wait.


On The Road Again

It should be a great day for blogging, assuming truck stops and McDonald's all have free wi-fi. I left the heart of the Bakken, Williston, North Dakota, at 2:30 a.m., central time, and set the cruise control for 50 mph. I had to pull over several times to let truckers pass. I enjoyed the scenery -- lit up oil rigs, and a few huge flares.

I debated whether to stop for coffee in Watford City, but knowing that the next stop would be an hour or so down the road, Belfield, elected to stop. Nice conversation with young man from Austin, Texas. He has been in the Bakken for four months. His plan is to work here for one year to build up cash reserve for his next step/stop in life. He didn't say what that was.

I cannot begin to tell the stories of all the wonderful folks in the Bakken, the retired old-timers, the working life-long residents, and all the new arrivals. I think my biggest thrill came almost as soon as I arrived in the Bakken: learning about a new subculture in the oil patch, the pipeliners. Maybe I will write about that story some day.

I arrived at the Belfield truck stop -- I guess it's called "SuperPumpers -- that's on the coffee cup -- about an hour ago. I was one of the few here, but now, at 5:13 a.m. local time, it is really getting busy, really busy. If you haven't seen a boom, it's impossible -- at least for me -- to describe. But here we are, in the middle of nowhere, at the crossroads of I-94 and US Highway 85, and it's about as busy as a big-city Starbucks at 7:00 a.m. It looks like 96% men, 3% women, 1% other stopping in to get morning breakfast. Morning breakfast appears to be two cups of "30% more caffeine" coffee, a can or two of Red Bull, some hot Mexican burritos or doughnuts, and then out the door. Some, maybe most, are also picking up provisions for the rest of the day: six-packs of water; more Red Bull; food that comes in cellophane from out-of-state (and maybe from out-of-country).

I am continually amazed how friendly the cashiers are wherever I stop. I left the store momentarily to go back out to the car -- I had not bought anything, yet -- and the young female cashier wished me a "good day." I told her I would be back in a few minutes, getting something from the car. She seemed genuinely happy to hear that. Her day will go by very, very quickly.

The traffic should die down a big going south toward Bowman. Most of the oil activity is east/west of this truck stop (Dickinson area; Whiting Pronghorn prospect) and then north into the heart of the Bakken.