Odds And Ends From The Bakken And Elsewhere -- September 29, 2014

Updates

September 30, 2014: even I missed this one. I had seen the story before but had forgotten all about it. The mainstream media is getting all excited about the fact that the US will become the #1 crude oil producer in the next month or so, taking the lead over Saudi Arabia. What folks have forgotten (including me), is that the US has been the #1 producer in petroleum products (oil + condensate) for the past 20 months, since November, 2012. I don't think the president has mentioned "it" once -- nothing about the oil and gas industry since 2012. Prior to that his only reference to the oil and gas industry was "putting his foot on the neck of BP" or something to that effect, or some platitude about the need to continue "studying" the Keystone pipeline.

Later, 6:18 p.m. CDT: with regard to the Simplot story below, a reader sent the following comment which I brought up here for easier access:

This is a very planned move by Simplot. It was announce last year that there would be 20,000 natural gas wells developed 70 miles west of Rock Springs, starting in 2016. This maske for a cheap and easy business decision for Simplot.
http://trib.com/business/energy/plans-for-wells-buoy-wyoming-s-oil-and-gas-future/article_f3d3ec28-41a5-566c-bde1-3009881dbe48.html.

From the linked article:

A series of Wyoming oil and natural gas project proposals which carry more than 20,000 planned wells are making their way through the study and permitting process.

The vast majority of the proposed wells are contained in only a handful of projects in western and central Wyoming, primarily targeting natural gas.

Each project proposal is likely to create hundreds or thousands of direct and immediate jobs and millions or billions in tax revenue for local governments. Each developed field could produce oil or gas for five decades.

"Five decades of production." In North Dakota they are drilling about 2,000 wells/year. If that holds true in Wyoming that's ten years of drilling.

Original Post

Stories sent to me by readers today.

US poised to become world's largest oil producer, surpassing Saudi Arabia, this month or next. President Obama will, most likely, schedule a presidential press conference in Watford City next month. The first linked story was in the Financial Times five hours ago. VOAnews, quoting EIA, almost exactly one year ago , said the US would be the largest oil producer by 2015:

The International Energy Agency (IAE) says that by 2015, the United States will surpass Saudi Arabia and Russia as the world's biggest oil producer and is on track to become energy self-sufficient in two decades.

The IEA said Tuesday that for the next 10 years the recent U.S. and Canadian success with shale oil drilling and deepwater production in Brazil will reduce the role of the Middle East-dominated Organization of the Petroleum Exporting Countries as the world's most prominent oil producer.

But the Paris-based adviser to 28 energy-consuming nations said the U.S. position as the top world oil producer will end by the mid-2020s as resources diminish at the fields being tapped at the moment in the mid-country states of North Dakota and Texas. The IEA said Middle East countries will then provide most of the increase in the global oil supply.

Mid 20's? I doubt it.

The Casper StarTribune is reporting:

But some business leaders see signs of change in fertilizer maker J.R. Simplot Co.’s plans to build a $300 million ammonia production plant near Rock Springs. The ammonia will be used as a key ingredient in the fertilizer made at Simplot’s existing production facility 4.5 miles outside the southwestern Wyoming town.

Others see the development as a result of the fertilizer industry’s unique dynamics, namely its need for cheap natural gas and its rural customer base.

The pay-off for Rock Springs, and Wyoming, is potentially large. At its height, in 2015, construction will require 440 workers. The project is expected to generate more than $11 million in local tax revenue for Sweetwater County through 2016, according to company filings with the state. And 25 fulltime jobs are anticipated to be added once it begins operations in 2016.

Simplot has long bought ammonia for its fertilizer production. Now the company will be able to improve the efficiency of its operations by producing ammonia on its own, said David Cuoio, a Simplot spokesman. The new plant, which will produce 600 tons of ammonia daily, is expected to cut the company’s shipping costs, he said.

Natural gas is key to ammonia production.

And finally this story from The Washington Post. I normally don't post these stories; there are plenty of sites that will archive them. My response when I got to the end of this article, "So what?" There has been a huge alcohol problem in the Dakotas for decades, and if one takes the time to google the issue one will find the same problem with "meth" in the Dakotas. Colorado found one way to deal with the marijuana issue: legalize it.

[Later. After posting the link to the Washington Post story, I posted an update regarding SHD. It would be interesting for that same reporter to do an in-depth story on the background of the folks running SHD. I think there would be quite a story line there. One can spend one's life reporting stories like the one linked above (the Washington Post story) or one can write stories that show how folks overcame diversity to became highly successful (however one wants to define success); or stories on redemption. But a story that tells me drugs exist where there is billions of dollars being spent, is a "dog-bites-man" story. Okay.]

The SHD story can be found here and here:

• 27040, see below, SHD, Thud 12-36H, Clarks Creek, producing, a huge well,

Comments: SHD has permits for eight wells sited in that section; one 4-well pad; two 2-well pads; this is going to be quite a location for SHD. To learn a bit more about SHD, click here.