Friday, January 3, 2014

QEP Reports Five Nice Wells In Heart Butte, The Bakken; OXY USA With Three New Permits

Active rigs: 184

Fifteen (15) new permits (sixteen were listed, but the very first one was a repeat) --
  • Operators: American Eagle (5), Petro-Hunt (4), OXY USA (3), Triangle (3)
  • Fields: Clear Creek (McKenzie), Colgan (Divide), Murphy Creek (Dunn), Manning (Dunn), Charlson (McKenzie), Elk (McKenzie)
  • Comments:
Wells coming off the confidential list were reported earlier; see sidebar at the right.

Five (5) producing wells were completed. This was a 2560-acre drilling unit because the minerals are under the river. In addition to this five-well pad, there is another 5-well pad just a few feet to the north (#23331 - #23335): 
  • 23336, 1,386, QEP, MHA 4-03-35H-150-92, Heart Butte, 4 sections, t12/13; cum --
  • 23337, 873, QEP, MHA 1-03-02H-149-92, Heart Butte, 4 sections, t12/13; cum --
  • 23338, 1,831, QEP, MHA 3-03-02H-149-92, Heart Butte, 4 sections, t12/13 (error on the ticket stub); cum --
  • 23339, 2,217, QEP, MHA 2-03-02H-149-92, Heart Butte, 4 sections, t12/13; cum --
  • 23340, 2,306, QEP, MHA 4-03-02H-149-92, Heart Butte, 4 sections, t12/13; cum -- 
How To Be Rich
J Paul Getty
1961, 1965
From p. 29:
Oil is a funny thing. It is likely to turn up in the most unlikely places. There are many areas in the United States where an enterprising wildcatter is quite likely to find oil -- and to strike it rich. Admittedly, most structures in recognized oil belts have been located and are being exploited. On the other hand, there are many localities which have received little or no serious attention from oil prospectors.

At the time I started wildcatting, "everyone" said there was no oil in the Oklahoma Red Beds. bythe same token, 30 to 40 years ago, oil operators got it into their heads that there was no oil in Oregon, Washington, Idaho, Iowa, or Utah -- to name only some states -- and passed them up. This theory without much fact to support it is proven by the fact that only a few years back, oil prospectors finally began drilling test wells in Utah -- and discovered oil.
Getty first struck oil in Oklahoma, in 1916, as a wildcatter.

There are official estimates of 3 trillion bbls of original oil in place (OOIP) in the Uinta formation (Utah).

On another note, I like the title: "how to be rich," not "how to become rich." I define "being rich" differently that Mr Getty, I suppose, but in terms of dollars, Getty's observations are excellent. 

Williston Wire's Top Ten Stories For 2013

But before we get to those top stories, wow, this is good (sent in by a reader).

This may be weird but I immediately thought of Tennessee Ernie Ford while listening without the video. (One certainly doesn't think of TEF while watching the video -- LOL.)

Who Will Comfort Me, Melody Gardot

Now, Williston Wire's Top Ten for 2013 -- 
  • Williston named fastest growing micropolitan. Again.
  • Glut of job openings; more than 700 in Williams County
  • Williston experienced a baby boom (not predicted five years ago)
  • New restaurants poured into Williston: Buffalo Wild Wings, Famous Dave's BBQ, Fuddruckers, Doc Hollidays, The Williston Brewing Company, Basil Sushi Bar & Asian Fusion just to name a few
  • Williston City Commission approved an unprecedented annexation of 4,888 acres, increasing the geographical size of Williston to 20.3 square miles
  • Apartment construction boomed in 2013 (despite moratorium on new building permits)
  • Sloulin Field continued to break enplanement records
  • Babe Ruth World Series drew large crowds and praise
  • Williston State College won the National Junior College Hockey Championship
  • Williston State College saw major transformation
Global Warming
Minot Temperatures For 2013

The Minot Daily News is reporting:
"This past month of December we had a monthly average temp of 4.3 degrees, which was 6.7 degrees below last year's average temps for the same month," he said. He said it was 9.1 degrees below the 107-year long-term average of 13.4 degrees.
The coldest day of the year was -27 degrees on Dec. 23 and the warmest day of the summer was 93 degrees set on Aug. 19, Tarasenko said.
On another note, the Minnesota governor closed all schools because of the frigid weather. But looking at the forecasts at Weather Underground, and even looking at the temperatures in the linked story, I can't get too excited about the temperatures. I remember much colder temperatures when growing up in Williston, North Dakota. Not only did they not cancel school, we still went outside and played.

Canadian Heavy Oil Still At A $20 Discount To WTI; Minnesota Deep Freeze Worst In 20 Years -- Ah, Yes, Global Warming

Bakken crude unchanged following Casselton derailment -- Inforum. This was posted by Inforum back on December 31, 2013:
Bakken crude was unchanged in a quiet market on Tuesday, a day after a BNSF train carrying oil collided with another carrying grains in North Dakota, setting off a series of explosions and a fire.
Bakken oil for February delivery at Clearbrook, Minnesota was pegged flat at a $9.50 a barrel discount to the U.S. front-month futures contract, one trader said.
Wow, west Canadian (heavy) oil still has a $20-discount to WTI -- Bloomberg. This was posted by Bloomberg yesterday.
Canadian crudes jumped on the spot market on concern that frigid temperatures will affect northern production and transportation.
Temperatures in Fort McMurray, Alberta, where the bulk of Canadian oil-sands production is centered, dropped to minus 38 degrees Celsius (minus 36.4 Fahrenheit) late yesterday, according to The Weather Network.
“There is no doubt that the cold weather is impacting operations up there,” said Andy Lipow, president of Houston-based Lipow Oil Associates LLC. “The market may be sensing that there is going to be some reduction in supplies.”
Western Canadian Select heavy oil for February delivery reached the strongest level in five months, narrowing its discount to West Texas Intermediate oil by $3.90 a barrel to $19.85, according to Calgary oil broker Net Energy Inc. Contracts for March and second-quarter delivery also gained at least $2 a barrel.
A Note to the Granddaughters

Minnesota governor closes schools: too cold. Minnesota's deep freeze the worst it has been in 20 years. Up to 30 inches of snow north of Boston. At USA Today:
The bitter cold that gripped the snow-covered northern tier from Cleveland to Boston on Friday shows no sign of easing, as another arctic blast roaring out of Canada threatens to drive weekend temperatures to all-time record lows.
The National Weather Service said "dangerously cold temperatures" will slam the Northern Plains and Upper Midwest through the weekend, driving wind chill temperatures in some areas to below -60 degrees F.
Remember: the northern hemisphere is subject to worse global warming than the southern hemisphere. So it's even colder in the southern hemisphere.

I honestly do not remember ever staying home from school while growing up in Williston, North Dakota, due to cold weather.

I went to kindergarten at First Lutheran Church. That was too far to walk and, as part of a car pool, I was driven to kindergarten with two or three other rug rats on a daily basis. One noon during the winter my dad was late picking us up and we started walking home. (Cue up videos of South Park.). We were probably about six blocks from the church when he found us. To walk those six blocks we would have had to cross Main Street and the busy, busy intersection where Happy Chappy's gas station was located -- across from Harmon Park.

I have only one memory of first grade. We attended the new Wilkinson Elementary School, beginning in second grade, but my first grade was in the west corner of the Williston High School. The high school was about a mile from where we lived; we took short cuts, so maybe it was 0.75 miles. All I remember: the walk was uphill in both directions with six-foot snow drifts. We walked to school but regardless how cold it was outside we were not allowed to go in until the bell rung.

I remember my first act of civil disobedience. It was probably February, 1958, and we were standing outside in the dark about 7:45 a.m., waiting for the bell to ring. It was probably a minus 9 degrees (let's pick a date, February 7, 1958). We were freezing. We began to chant: "Let us in. Let us in. Let us in."

Yelling and chanting kept our minds off how cold it was and probably warmed us up a bit. After a few minutes of chanting a school official opened the school door slightly and told us to come in. No. He/she told us to go home and come back later, closer to the time when the bell would be ringing. Can you believe that?

We weren't dumb enough to walk all the way home, so we walked across the school lot, past the football field, and to an open lot on the corner of 14th Street and 6th Avenue and there we waited. In sub-freezing weather -- sub-zero weather, we waited, waited for the school bell to ring. And then when the bell rang, we ran as fast our little feet in heavy winter boots would go. We didn't want to be late, and counted tardy.

The rest of my elementary school years were spent at Wilkinson Elementary School which was about the same distance from home but in a different direction. I never remember school being canceled because the weather was too cold. I remember skating on ice skates on the asphalt residential roads one day following a freak weather event when snow melted and then froze overnight. But it was never too cold to go to school.

In response I received this from a reader (this was too good not to post and so much better written than what I wrote. I believe it maintains anonymity):
I graduated in 1974,  and from the time I started Kindergarten at First Lutheran, through elementary at Rickard, and on through WHS,  I never remember having a snow day either. 
One thing I do remember is the old dress code (that didn't change until I started high school) that required girls to wear dresses or skirts every day, regardless of the cold, frigid weather outside.  We at least were able to wear pants under our dresses, but had to remove them as soon as we entered the classroom. 
I also remember how we would walk home for lunch every day at Rickard. Being we only lived a block away, it was no problem for us.  But there was one particularly nasty day when my mom trudged up to Rickard school wearing her storm coat to give us 2 dimes so we could eat lunch at school that day.  She didn't want us walking home in the blizzard.  It scared me that the weather would be that bad. 
But most days, we would play outside in the snow before school, at morning recess, after eating lunch before the bell rang, afternoon recess, and then as soon as we got home from school, we would gather up our skates and head back to the skating rink that was on the corner of the school.  We would skate until supper, then head back out after eating again!  Of course considerable time was spent in the heated warming house next to the rink!!  But then that was in the days when kids were allowed to be kids as we weren't overburdened with homework.  We just read books for the fun of it as TV was just one channel basically (NBC, KUMV-TV, channel 8).

Freshman year at WHS brought 2 new things:  new dress code where girls could finally wear pants (nice pants, no jeans of course!) and a new requirement that all freshmen had to take swimming.  My swimming class was right before lunch.  There wasn't enough time to dry your hair enough with the wall-mounted hair dryers as we were in a hurry to head home for lunch. We walked home regardless of the snow or temperature, or wet heads!! 
One more thought: that indoor swimming pool (that had an underground tunnel connecting it to WHS). That was where my parents would later go to swim every day after retirement.  Dr. Hagen was their family doctor.  My how I wish my parents, and especially Dr. Hagen!!, would have been alive to see his granddaughter set world records in swimming in the Olympics!!!
Ah, yes, channel 8, the only channel we got for many, many years in Williston. 


2013: The Year The Economy Turned Positive

Back on December 9, 2013, I started tracking incredibly positive economic data points. It's very possible, four years from now, folks will look back on 2013 as the year the US (and global?) economy finally turned. Don sent another link this morning with another interesting data point: Ford Motor Company has its best sales year since 2006.

The Wall Street Journal

The lead story. I cannot make this stuff up. Wal-Mart recalls donkey meat in China. Why. DNA testing showed it contained fox meat. Now, how did that happen?

Medicaid expansion drives up visits to ER

Fast (85 mph) toll road in Texas struggles to pick up drivers.
A Texas toll road that garnered widespread attention when it opened in 2012 with an 85-mile-an-hour speed limit—the nation's highest—has run into financial trouble after failing to attract as many drivers as anticipated.
The 41-mile stretch of State Highway 130 has been billed by its private operator as an escape hatch from the often congested freeway that connects the state capital (Austin) with San Antonio to the south. But SH 130 Concession Co., the company that built and runs this portion of the 91-mile state highway, recently hired restructuring lawyers, according to people familiar with the matter, who noted that a bankruptcy filing isn't imminent.
Companies often restructure debt without filing for bankruptcy protection by negotiating with creditors, a process that can take weeks or months. SH 130 Concession, whose only business is operating the roll road, is working on refinancing about $1.1 billion in debt amid lower-than-expected cash flow, due to weaker-than-forecast traffic, according to the people familiar with the matter.
California stretched by worsening drought

Will they or won't they? The Boeing union in Washington votes today.

"Cost row" may halt Panama Canal expansion.
The Spanish-led consortium expanding the Panama Canal said Thursday it has warned Panamanian authorities that work will be halted unless Panama's government pays an extra $1.6 billion for cost overruns in the massive project.
Panama's president, Ricardo Martinelli, quickly rejected the apparent ultimatum. On his official Twitter account, the president said Thursday he will travel to Spain "to defend Panama's interests in the expansion of the canal" by demanding the Spanish company and other firms involved in the project honor conditions already agreed to in signed contracts.
Inside the greatest play of all. This is really a "fun" article to read -- the "punt" return to end the game, win the game for Auburn over Alabama a couple of weeks ago.

J Paul Getty

The other day I posted a vignette from J Paul Getty's autobiography, As I See It. A very good, a very easy read. Highly recommend.

But to put the autobiography in context, one should read pages 439 to 449 of Daniel Yergin's The Prize: The Epic Quest for Oil, Money & Power.

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you might have read here. 

I am absolutely convinced that some North Dakotans, taking in millions of dollars in royalties could emulate guys like J Paul Getty. There are some very small publicly traded operators, and that's exactly what J Paul Getty targeted when he started out.

In the better Bakken, folks who "have one well" will eventually have 14 wells or more. That's not trivial.

Active Rigs In North Dakota Exceed The Number Of One Year Ago; Blizzard Warnings Across Almost The Entire State Of North Dakota; Special On Renewable Energy

 I'm not exactly sure why the storms start right at the state borders.

Active rigs: only once in the past five years, have "we" had more active rigs on this date; that was two years ago --

Active Rigs18518219615973

RBN Energy: Update on the debacle in New England -- not enough natural gas pipeline capacity --
All is generally well (though gradually tightening) during the spring, summer and fall as far as gas pipeline capacity into New England is concerned. But during the winter months, when gas needs for space heating rise and gas needs for power generation can soar, the existing pipeline infrastructure through New York State simply does not have enough capacity to meet demand reliably, especially when gas is needed most. Fresh in the minds of just about anyone associated with gas and electricity supply in New England are several frigid days last January and February. TGP, AGT, IGT and PNGT were operating at or near full capacity and couldn’t accommodate the additional demand for gas from power plants, and, with gas production from the Sable Offshore Energy Project (SOEP) in decline and the Deep Panuke not yet producing, the MNP was only partially full. The result: gas prices at the Algonquin Citygate spiked and several New England power plants had to sit idle without secure supplies.

Overlooking a little valley near the Pacific Ocean, south Los Angeles, January 3, 2014, 8:20 a.m. local time:

Renewable Energy

The Wall Street Journal has a special section on renewable energy today. The headlines / links:

Some Things Can Never Be Explained -- For Investors Only

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here. 

A reminder to remain diversified, I suppose.

I would never have guessed this. I was in the process of looking up something else when I stumbled across this little gem. Well, actually two little gems.

Despite a "down" day on Wall Street and the Burlington Northern Santa Fe derailment story, Union Pacific hit a 52-week high.

And, PSX traded at yet another 52-week high.

Who wudda guessed on either account? Yes, I know the price of oil fell to $95 which benefits refiners. But still.

By the end of the day, UNP had fallen back below its high, after the government report came out regarding the flammability of Bakken crude oil.

AMZG was back at its entry point, according to an earlier article, some weeks ago.

And that's about all I looked at.