Monday, October 13, 2014

Only Six New Permits, North Dakota; ISIS Makes Significant Advances -- October 13, 2014

New poll: with announcement of proposed $4 billion plastics plant coming to North Dakota, which city is at the top of the list. Since Fargo is clearly the #1 choice in my mind (right, wrong, or indifferent), I'm just looking for thoughts from readers which city might be #2.

Active rigs:

Active Rigs191184192195153

Wells coming off the confidential list over the weekend and Monday were posted earlier; see sidebar at the right.

Six (6) new permits --
  • Operators: Statoil (6)
  • Fields: Banks (McKenzie)
  • Comments: 6-well pad, I believe
Wells coming off confidential list Tuesday:
  • 27504, drl, Hess, BB-Budahn A-150-95-0403H-7, Blue Buttes, no production data,
  • 27809, drl, Statoil, Maston 34-27 6H, Banks, no production data,
Five permits cancelled.

Pressure Building To D/C Exploratory Drilling In The Bakken

Bloomberg is reporting:
Bakken shale-oil producers are under pressure from tumbling prices to scale back their 2015 drilling plans in a region that accounts for one of every eight U.S. barrels of crude.
Bakken oil fell 1 percent to $79.40 a barrel today, the first time it’s dropped below $80 in 11 months, according to data compiled by Bloomberg. Crude prices have been declining worldwide as ample North American supplies tempered the U.S. appetite for imports and Persian Gulf producers signaled they’re prepared to keep output high to protect their market shares in Asia.
Companies drilling expensive, experimental wells in frontier regions such as the Tuscaloosa Marine Shale beneath Louisiana and Mississippi will be first to feel pinched by the drop-off in prices, said Gabriele Sorbara, an analyst at Topeka Capital Markets in New York. Bakken producers will soon feel the pain as well as their returns dwindle.
That would stop the flaring problem.

CNN is reporting:
The battle for a key Syrian city on the Turkish border intensified Monday as ISIS continued its push for control of Kobani while also scoring a victory in neighboring Iraq, taking a strategically important military base in Anbar province.
A fighter from the Kurdish People's Protection Unit, or YPG, told CNN's Arwa Damon that the battle in Kobani concerned the main border crossing into Turkey. If ISIS took control, he said, "it's over."
The fighter said the Kurdish fighters had pushed back an attempted advance by ISIS on Monday morning but that it would be "impossible" for them to hold their ground if current conditions continued.
Should they take Kobani, the militants would control three official border crossings between Turkey and Syria and a stretch of the border about 60 miles (97 kilometers) long.
Official: Even Small Droplets Could Contain Ebola Virus

Dr. Dennis Maki, University of Wisconsin-Madison infectious disease specialist and former head of hospital infection control: "New data suggest that even tiny droplets of a patient’s body fluids can contain the virus, Maki said."

I think this has been known by "everyone" for the past ten years. The first known outbreak was back in 1976. It has been studied "to death" ever since.


  1. Land around Fargo and Red River Valley too expensive for the large plant, and too much competition from other highly skilled industries. Target can't even find new hires (which is probably true for most of the state).

    1. Wow, if Target cannot find enough new hires in Fargo this speaks volumes about the challenges a company that requires 500 employees will have in North Dakota.

  2. one of the dumbest things - outside of gov't mouths - I have ever heard....that's a big duh

    1. ... even malaria can be transmitted by a single mosquito. And the malaria parasite is a whole lot bigger than a single Ebola virus.

  3. I keep coming back to the rig count. If they keep stable at 190, I don't see how either flaring or prices could be holding back the boom. Maybe there is something I'm not getting. My simple thought is if either one was an issue than they would stop the drilling. The only reason they would continue might be pre-purchased contracts?

    1. There are so many variables. Just two examples:

      1. They can drill where the natural gas processing gathering systems and processing plants are in place.

      2. They are now into pad drilling. The number of wells waiting to be fracked has increased significantly over the past three months. It will be interesting to see the number of wells waiting to be fracked in the next Director's Cut. The cost of drilling is coming way down; fracking is the big cost. Remember the CLR Atlanta pad: about 14 months from the first spud to the 14th well being fracked and completed. Those 14 wells weren't flaring or producing for a almost a year and a half.

      So there are a lot more variables than the number of rigs. For me, in the Bakken, it comes down to this: a) pad drilling has changed everything; and, b) location, location, location.

    2. Somehow I accidentally deleted the following comment from Jane Smith. Sorry. Here it is:

      I agree w/the last comment. The rig count is staying in place because there are a number of wells to finish up before winter and there are a lot of wells drilled that need to be completed (and already have a "sunk" investment that needs to be covered w/production. So, I wouldn't expect to see a big pull back now in work and if it happens, it will be in late winter Feb/Mar time frame when there are no more permits and all confidential/drl statused wells are now completed. Hopefully by then the price if oil will be upl

    3. I agree with you that it will be late winter February/March before we start to see UNANTICIPATED changes in rig counts. Things are in motion and to some extent on "auto-pilot." The oil companies constantly / continuously review short-term and long-term plans.

  4. Good lord. Common sense (I know) would indicate that if the amount of (anything) that a company could produce is constrained by regulation then less would be produced. Are you people stupid?

    1. Common sense is not "common," I once heard someone say.

  5. But the drilling is less weather limited than the fracking. So I don't see why "squeezing in before winter" would be the rationale.

    Also, if there is a big pile-up waiting for completion, why drill more? The factor you mention argues the opposite way (e.g. they can catch up with drilling later if price goes up).

  6. Curious, why is do you feel the cost of fracking is high? I understood it was 3-5 days of work. Relative to the moving of rigs and the staffing of rigs, I wouldn't have thought the fracking was a greater cost.

    Also, the last comment about the drilling being less weather limited than fracking is curious. I agree that if there is a backlog of wells drilled and needing fracking, then that is where the focus should be.

    This is all really interesting as to understanding the drilling process/cost and associated fracking cost .

    1. Way too many issues to discuss here.

      It's counter-intuitive but weather is a bigger problem for drilling than fracking, but that's simply my opinion. If someone else feels that weather is a bigger problem for fracking than drilling, that may simply be an opinion. It could be fact. The problem with "anonymous" comments we don't know the credibility of those posting. If Harold Hamm says weather is a bigger problem for fracking than for drilling, I would take his word for it. But with "anonymous" comments, there's no telling.

      Everyone should pretty much know my expertise: none.

      Whatever I "know" about the Bakken has simply been from following the Bakken day in and day out from 2007 and posting multiple times daily since then. I have no formal training, education, or background in oil. I certainly could be very, very wrong on most of what I post when it comes to "musings" on the Bakken.

  7. Fargo is too high class in their own mind to support a petrlchemical plant. There simply is not enough water there or I Wahpeton or Jamestown. This plan needs a bunch of cooling water as the ethane will be heated to 1500 F for milliseconds and then quenched.

    Along the Mo River is the logical place. Stanton, Washburn, Wilton, or Mandan north of Tesoro.

    A wild card is Grand Forks neat the proposed fertilizer plant. The Red is much bigger there, the fertiler plant will be synergistic, and land is cheap with some of the alkali land N and W of GF.

    These jobs won't be filled by most Target workers. Chemical opators have to be skilled in computer controls and need to be handy with a wrench and be able to ascend ladders.

    1. Mandan. Puts Bismarck-Mandan back into play.

      Lots of water? Devils Lake, he said, "tongue-in-cheek."

  8. A couple of things about the fracking of wells. One, the actual frac job takes up to five days, but the time it takes to haul the needed water and sand or prop pants to location takes days to a couple weeks, depending on the number of trucks hauling.
    Secondly, weather has more of an effect on fracking than drilling. Drilling rigs are built to run no matter the temperature. Frac jobs usually are postponed if very cold temperatures are expected, due to the inability to keep the water warm enough so it doesn't freeze as the frac is in progress. Most of the time the water needs to be heated to a certain temp for the frac to work properly and it can't be kept warm enough when temps are below zero. I know of fracs that were postponed because the temps were 10 to 20 degrees below zero, and the heating equipment could not keep up.

    1. This is what makes the Bakken so incredibly interesting.

      Generally speaking, drilling can be done year around. On any given day, weather in the Bakken can play havoc with drilling. I remember the number of reports in the Director's Cut when drilling days were decreased simply because the wind was too strong.

      The major challenge with fracking is a) cold weather; b) getting proppant and water to the site. The cold weather issue is eliminated by scheduling no fracking between November and March, something that becomes more feasible with pad drilling.

      Getting proppant and water to the site becomes an issue when road restrictions are put in (the spring). Road restrictions are a bit more variable, but not much. Again, no fracking during the two-month period (or however long it is) when road restrictions are in effect. Pad drilling, again, provides that flexibility.

      The point I'm trying to make: pad drilling changes everything. One can make a case for no fracking between November and March taking weather out of the equation. But yes, on any given day when the temperature if 40 degrees below zero, the temperature has more of an effect on fracking than drilling.