Sunday, November 3, 2013

Wow! I'm Just Getting Started And I Have To Leave In A Few Minutes ...

... for a swimming meet that the granddaughters are competing in.


Too much to report, too much to blog, and I'm just getting started. I haven't even seen the Sunday paper yet. (Actually, incorrect. I have seen it. In fact, I bought a Sunday paper for my wife, but I have not read it yet.)

Wow, I love to blog. I have another site in which I try to remember the halcyon days of northern England, specifically Yorkshire where the US Air Force sent me for weeks on end many years ago. Tough assignment. I must have walked every square mile of that huge county. I know it well. I lived and walked and breathed the Yorkshire Dales.

Sweet memories were brought back when I read this article sent to me by a reader (and linked at the sidebar at the right, by the way): Leave California now, while you still have the chance.

In that article, this paragraph:
Actually, Europe has been there for some time now. In England’s Yorkshire Dales, they’re tearing down four wind turbines that have been around for twenty years and “have not worked in years.” Indeed, across Europe there is a lot of buyer’s remorse for having embraced wind and solar. As Marc Morano, the editor of, noted in an October 17 article, “Wind and solar mandates are breaking Europe’s electric utilities.”
Here's the link to one of my posts on the Yorkshire Dales

Wow! Timing Is Excellent! Why I Love To Blog

The other day I posted four screen shots of Whiting's new completion technique.

Today, Mike Filloon, over at SeekingAlpha posts this: Bakken Update: Frac Sand Pricing Could Go Parabolic As Whiting's New Well Design Crushes Q3 Analyst Estimates.

I have not read the story. I think there is another opportunity for investors which I talked about years ago when I first started blogging. It may come up again. I will let folks think about this for awhile before I provide the answer. Clue: another company in the oil patch recently blew away analysts' expectations. 

Wells Coming Off The Confidential List Over The Weekend, Monday; MRO Reports Two Big Wells

I usually don't post this information until later in the evening, but breaking tradition, here they are, the wells coming off the confidential list over the weekend and Monday:

Monday, November 4, 2013
  • 20915, 3,363, HRC, Fort Berthold 150-94-3B-10-2H, Spotted Horn, t8/13; cum --
  • 23652, 932, Whiting, Wagner Farms 11-16PH, Dutch Henry Butte, t6/13; cum 37K 9/13;
  • 24236, 315, Whiting, Babeck 31-5PH, Park, t5/13; cum 13K 9/13;
  • 24237, 854, Whiting, Babeck 41-5PH, Park, t5/13; cum 25K 9/13;
  • 25188, 2,132, QEP, Bert 2-2-11TH, Grail, t10/13; cum 9/13;
  • 25222, 321, Samson Resources, Charger 0706-1H, Ambrose, t9/13; cum 6K 9/13;
  • 25275, drl, MRO, Betty Fettig 21-27H, Killdeer, producing,
Sunday, November 3, 2013
  • 21343, 1,869, MRO, Darwin 34-35H, Murphy Creek, t9/13; cum 19K 91/13;
  • 23746, drl, Statoil, Mark 4-9 2TFH, Williston, no production data;
  • 24575, 980, Whiting, Pavlish 31-30PH, South Heart; t5/13; cum 37K 9/13;
  • 24957, drl, SM Energy, Cade 12-19HA, Poe, no production data;
  • 25101, 2,566, MRO, Martin 31-14H, Reunion Bay, t8/13; cum 36K 9/13; file report not available yet;
  • 25114, 2,417, MRO, Patrick 34-32H, Bailey, t8/13; cum 26K 9/13;
  • 25203, 1,033, Hess, EN-Trinity-154-93-2833H-4, Robinson well; t10/13; cum 11K 8/13;
Saturday, November 2, 2013
  • 20916, drl, HRC, Fort Berthold 151-94-34C-27-2H, Antelope, no production data, 
  • 23953, 2.022, KOG, Charging Eagle 16-21-16-1HA, Twin Buttes, t8/13; cum 27K 9/13;
  • 24433, 252, CLR, Stoltenberg 1-9H, Corinth, t8/13; cum 3K 9/13;
  • 24530, 818, Petro-Hunt, Wollan 152-96-27D-3H, Clear Creek; t9/13; cum 11K 9/13;
  • 24854, drl, Statoil, Arvid Anderson 14-11 6H, Alger, no production data;
  • 25187, 2,175, QEP, Bert 2-2-11BH, Grail, t10/13; cum --
  • 25223, 495, Samson Resources, Charger 0706-1H, Ambrose, t9/13; cum 7K 9/13;
  • 25228, drl, XTO, Koeser 41X-15G, Siverson, no production data;
  • 25229, drl, XTO, Koeser 41X-15H, Siverston, no production data;
  • 25273, 75, Legacy, Legacy Et Al Bernstein 5-17H 2H, Red Rock, a Spearfish well; 320-acre spacing; t5/13; cum 9K 9/13;

25101, see above, MRO, Martin 31-14H, Reunion Bay:

DateOil RunsMCF Sold

25114, see above, MRO, Patrick 34-32H, Bailey:

DateOil RunsMCF Sold

Digressions On The Keystone, ObamaCare, And The Red Queen

It took me a long, long time to work through the various phases of my thoughts on the Keystone XL issue.

Regular readers have put up with my constantly changing themes on that debacle. My very first posting on the Keystone XL was a note-in-passing; I had no interest in pipelines, and certainly not in pipelines that were not part of the Bakken. I noted the story, moved on, and never planned to return to the Keystone XL. I noted that I did not have a "dog in that fight" and could not care less about the a pipeline.

Then, over time, the Keystone XL took on a story of its own, becoming a regular issue of interest for the blog.

My thoughts about the Keystone XL have gone through these stages:
  • could not care less (see above)
  • seriously? thousands of miles of pipeline in this country and folks are up in arms against one more? certainly "you" have got to be kidding
  • comical (readers, I'm sure remember my soap series: As The Keystone XL Turns)
  • incredulity: I couldn't believe this story had lasted four years (we're easily into our fifth year, now)
  • back to comical
And that's where it will probably end for me, just a comical story. There are serious ramifications but the serious ramifications are overshadowed by the comedic theme running through the entire story.


Which brings me to ObamaCare. It did not take me as long to go though the various stages of thought regarding ObamaCare. Unlike the Keystone XL debacle, ObamaCare has very, very serious ramifications and it was never comical. My initial reaction was emotional, visceral, political, but the story has now become, simply, a fascinating, serious, historical issue unfolding before our very eyes. The nice thing about blogging (or keeping a journal), at least for me, is to help me sort out what is going on, or trying to figure out something. Someone once told me: if you can't write it down (put it into words), you don't understand it.

[That's the reason I started blogging on the Bakken; I had been through several booms and busts in the Williston Basin oil patch, and never understood the phenomenon. I was in the Bakken from the beginning and I didn't want to miss another opportunity to learn. Through blogging about the Bakken, I feel I have a very, very good understanding of what is going on. I make factual errors while blogging about the Bakken but in the big scheme of things these errors are unimportant; readers point them out; I correct them and move on. It's the big story that fascinates me; it's the big story that is important.]

I will continue to blog about ObamaCare. My comments will seem partisan, emotional, visceral. That may be the impression but it won't be reality. Forget the politics. The turning point was the article I posted last Thursday. I finally figured it out. The whole thing.

There are a gazillion things to consider when thinking about ObamaCare. But this is the one "thing" that ObamaCare keeps coming back to: there are no lifetime caps on medical expenses. Think about that.

I am unaware of any other example in which any sector in the US economy has just been hit with an unlimited liability (with the exception of the unfunded government mandates). The program simply won't work. Think about it. There are no medical caps. No one has any idea how much this is going to cost; there has been no precedent for this anywhere, in the history of the universe. In the past, once medical care got past a million dollars or so for an individual who could no longer pay, the providing medical system (Mayo Clinic, for example) simply wrote it off as "goodwill" and took the financial hit and the tax benefit. But now, the insurance company is going to be forced to continue paying Mayo Clinic, and the insurance company is "us." The only way for the insurance company (and companies) to pay these millions in claims is by raising the premiums.

The rise in premiums folks are talking about now are for calendar year 2014. After April, 2014, the deadline for signing up for ObamaCare (the individual mandate has been extended six weeks, I believe), the insurance companies will be calculating the premiums for 2015, which will be announced in late 2015. By mid-2014, insurance companies will have a very good idea a) how much this will cost them; and, b) holy cow -- the Affordable Care Act really does mean the end of lifetime medical caps.

I will continue to blog / link stories about ObamaCare, but now it will be simply for archival purposes; it's not longer personal, visceral, emotional. It will be simply fascinating to watch this unfold in real time as folks realize what ObamaCare means.


So, what does ObamaCare have to do with "all Bakken, all the time"?  For most of my readers, probably nothing. For me, blogging about ObamaCare does at least three things. It puts the Bakken into perspective. Twenty years from now when I'm going through the blog, it will be important to know what else was going on in the US during the Bakken boom. Second, it adds a bit of spice to the blog. I've read other one-subject blogs and after a while they become tedious, boring. Adding something like ObamaCare to the blog breaks up the monotony of the Bakken.

Finally, it allows me think about big issues and finding ways to make them easier to understand. After months of blogging about ObamaCare, I finally had my "aha" moment last Thursday and the entire thing became clear. I do not know what Senator Baucus, an originator of ObamaCare, saw that made him remark that ObamaCare was going to be a trainwreck. This newsmax article suggests he was only worried about the website, the rollout. Note the date of that article. He probably wishes he had stayed with his original thought.

By the way, there is a very, very famous precedent for this. Sometime after Professor Einstein became famous for his specific and general theories of relativity, he was forced to insert a "fudge factor" to make his theory on the fate of the universe to work. Some years later, he realized his "fudge factor" was the most stupid thing he had ever done and said he wished he had never "invented a fudge factor." In Mr Baucus' case, the situation is reversed. When he called ObamaCare a "trainwreck" he was right on target. Five years from now he will wish he had not changed his tune.


Speaking of the Red Queen, which we weren't. Regular readers know the argument about the Bakken and the Red Queen. LOL. See the tag. Why limit the Red Queen discussion to the Bakken. The Red Queen effect is sine qua non of the oil and gas industry. Look at the headlines/ledes for XOM over the years:

Exxon Mobil reported its greatest decline in production in a decade, July 31, 2008.

Exxon Mobil Corp. reported lower- than-estimated second-quarter profit as production growth lagged analysts’ forecasts and refining earnings outside the U.S. declined.

Exxon Mobil slid Friday after the company reported inline earnings on higher prices and asset sales, but also a 9% decline in production, January 31, 2012.

Exxon Mobil is spending more on capital investments and exploration but output in Q1 declined anyway, sending earnings down below forecasts, April 26, 2012.

Exxon Mobil Corp.'s first-quarter profit rose slightly compared to last year but its production of oil and natural gas fell, as the energy giant continued to struggle in a world where large oil-and-gas fields are harder to find, April 25, 2013.


The other day I posted a YouTube video of Velvet Underground's self-titled album of 1969. I enjoyed it (the music, not the process of posting) so much I decided to post another Velvet Underground YouTube video. In 2003, Loaded was #109 on Rolling Stone's reissue of their 500 greatest albums of all time.

Unloaded, Velvet Underground

My wife does not know this yet, but I am thinking of getting our 7-y/o granddaughter a set of drums; she loves to drum; I think she could become a great drummer. Mo Tucker.


Back to ObamaCare. A reader sent me this article which I had already seen, as reported by Bloomberg: ObamaCare documents show 248 enrollees in first two days. This was my reply:
And I can guarantee you that the 248 that signed up have huge medical bills pending: cancer, AIDs; folks don't fight that hard to get insurance if they are healthy and the mandate deadline is several months from now. A lot of insurance company CEO's are sweating bullets right now.

By the way, I don't know if you saw the headline that the insurers were against the six week extension. Because of the website problems, the administration agreed to a six-week extension. Whatever the insurers factored in for premiums for 2014, they assumed premiums would start coming in as early as January 1, 2014, and NO LATER THAN April 1, 2014 (the original deadline was March 15, 2014), but now with a six week extension, that takes the deadline to May 1, 2014, meaning the first premiums would be due in June -- so insurers will start paying claims for the full year for those who sign up by the beginning of the year, but will only be getting premiums for the last half of the year for the later enrollees.

There is talk that insurers will be allowed a mid-year readjustment of premiums, but that has never happened before. I doubt Americans will tolerate a mid-year readjustment (up) and going into the election, the politicians won't allow it.  My hunch is that the politicians will vote to "cover" the insurers (bailout). There's no way the Tea Party can afford to stop this bailout. National Health Service is on the horizon, and it will be a talking point in the 2014 election.
Meanwhile, a reader sent me this article, sending it to me without comment. Based on the headline it seems to be a reporter (or reporters) promoting ObamaCare. There are only two groups still promoting ObamaCare: a) Obama hacks; and, b) those who qualify for ObamaPhones. The latter group appears to be increasing in size under this administration by the government's own statistics. But I digress. The NY Times article suggests that "millions of Floridians" will qualify for "fully subsidized" ObamaCare. If true, that tells one just how many very, very poor working people live in Florida (one has to have an income to quality for ObamaCare). What the writer(s) / reader do not understand is that folks who qualify for "fully subsidized" will not be able to afford the co-pays and/or deductibles.

But it will be an interesting state to follow: ObamaCare needs 7 million enrollees to make the program work. Seven million is the estimated sign-up goal for the first year; that has become the leading metric for the Obama administration. Without California, Texas and Florida, those numbers will be difficult, if not impossible to achieve.

Sunday Morning Coming Down: Book, Video Recommendations

It's probably a bit early to listen to this, but here it is --

Sunday Morning Coming Down, Johnny Cash

This is not random. Well, maybe it is. Whatever. In this weekend's edition, The Wall Street Journal has several good book reviews, including The Man In Black And White.
In the pantheon of American cool, it's tough to top Johnny Cash. He's right up there with Marlon Brando, Miles Davis and Jesse James. Cash has had die-hard fans of every stripe, from the Rev. Billy Graham, who for decades featured him on his evangelical crusades, to director Quentin Tarantino, who champions Cash songs like "Folsom Prison Blues" as "poems to the criminal mentality." Ten years after his death at 71, he is still a hero for millions allergic to any other country music, and his legacy as a rebel has inspired countless regrettable tattoos.
For his followers, Cash was more prophet than entertainer, offering a message of redemption as deep and alluring as his signature voice, his timeless music and his tormented life. "People believed in Johnny Cash," said his longtime bass player Marshall Grant. "They didn't just like his music. They believed in him."
As regular readers know, I do not watch network/cable television (except NASCAR and some of the recent World Series). But I do love DVDs. I'm in my Johnny Cash phase. Probably one of the videos I enjoy best that touches on Johnny Cash's beginnings is Good Rockin' Tonight -- The Legacy of Sun Records. I would be surprised if this is not in the Smithsonian.

But even better, there's a preview of what sounds like a great book that will be published this Tuesday, November 5, 2013, The Frackers: The Outrageous Inside Story of the New Billionaire Wildcatters.

It is such a great article, I might re-type the entire article and place it in the blog; I won't cut and paste the article, but I will retype it in its entirety if the spirit moves me. It's that good. Talking about the housing bust and the financial system meltdown, the article interestingly starts out this way:
What's most surprising about both events is how few experts saw them coming—and that a group of unlikely outsiders somehow did. Federal Reserve chairmen Alan Greenspan and Ben Bernanke failed to foresee the financial meltdown. Top banking executives were stunned, and leading investors such as Bill Gross, Jim Chanos and George Soros didn't fully anticipate the downturn. 
The big winners were people like John Paulson, an expert in mergers who only began researching housing in 2006 and scored a record $20 billion for his hedge fund. Jeffrey Greene, a Los Angeles playboy who partied with Paris Hilton, made $500 million predicting housing troubles. 
What does this have to do with fracking? See more at the link. I'm definitely buying the book.