Over At Seeking Alpha: Another Halcon TMS Well "Comes In Strong" -- August 22, 2014

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TMS: Tuscaloosa Marine Shale. 

Over at SeekingAlpha:

• Halcón made public test results for its second TMS East well, the Black Stone 4H-2.
• On a per lateral foot basis, the result is in line with the play's cutting-edge IP rate.
• Two additional wells, the Fassman 9H-1 and SD Smith 1H, have been successfully drilled and are now in the completion stage.
• Halcón made a strong case for the TMS' potential to evolve into a highly successful play. 

Continuing:

As a reminder, the Black Stone is Halcón's second operated well on the company's TMS East acreage, and is located in Wilkinson County, Mississippi. The well was successfully drilled with a ~5,400 lateral. After all the 22 frac stages were successfully pumped, Halcón encountered fill during clean-out operations near stage 10. It appears that the company was unable to remediate the situation, and the well ended up producing from a partial wellbore. According to the company's slide (below), only 2,873 feet of the lateral are effectively contributing. The Black Stone tested with a 24-hour IP rate of 553 barrels of oil and 0.5 MMcf of gas. On a three-stream basis, this equates to 715 boe/d, assuming full ethane recovery.

I track the TMS, to some extent, here. 

Remember: many SeekingAlpha articles disappear in a few days, going to "subscriber-only" status. You've been warned.

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Permian Shale Upending Oil Prices

I thought I had posted this story; maybe I did. But in case I didn't here it is again (?), the link sent in by Steven. Bloomberg is reporting:

Skyrocketing oil production in the Permian Basin has reversed a decades-old price relationship between heavy and light crude in the U.S.’s largest oil patch.

West Texas Sour traded at a $5-a-barrel premium to West Texas Intermediate in Midland, Texas, yesterday after reaching $10 on August 19, 2014, the highest level in Bloomberg data dating back to 1989. WTS has averaged a 97-cent premium this year after averaging a discount in every year back to 1989.

WTS has historically been cheaper because it’s heavier and higher in sulfur than WTI. The quality difference has meant that pipeline companies move the two grades out of the basin in separate batches.

New shale wells in the Permian have pushed production beyond pipe capacity. Most of the new crude is light, so it’s harder for producers to find space in those batches, Sandy Fielden, director of energy analytics at consultant RBN Energy LLC, said in an interview yesterday.

“There’s more WTI coming out that’s trying to get to pipelines, so it’s more stressed,” Fielden said after a presentation at a conference hosted by RBN and Turner Mason & Co.

The pipeline constraints have made both WTS and WTI in Midland discounted to the U.S. benchmark, which is WTI priced in Cushing, Oklahoma.

WTS was $8 a barrel below the benchmark yesterday, compared with $13 below for WTI in Midland. Midland is the pricing point for Permian crudes. 

RBN Energy is referenced; I think that's where I first noted this -- the Permian upending oil prices, over at an RBN Energy blog posting.