Monday, January 13, 2014

Random Look At Some Nice Wells That Were Completed Last Year

I was in the process of updating 2Q13 wells, updating some of the wells that came off the confidential list, went to DRL status, and have now been completed and have reported an IP and some production.

In the process I was struck by the number of great wells. Look at these wells. For newbies, when I first started blogging, if we hit 100,000 bbls in the first year it was a great well. Look at some of the Slawson wells below, hitting 100,000 in less than 6 months.
  • 22484, 2,946, EOG, Hawkeye 102-2501H, Clarks Creek, t1/13; cum 171K 11/13;
  • 22485, 1,926, EOG, Hawkeye 01-2501H, Clarks Creek, t1/13; cum 176K 11/13;
  • 23304, 1,444, WPX, Blackhawk 1-12HW, Moccasin Creek, t7/13; cum 95K 11/13;
  • 23457, 1,196, Hess, BB-Budahn A-150-95-0403H-2, Blue Buttes, t6/13; cum 110K 11/13;
  • 24409, 1,339, Hess, BB-Budahn A 150-95-0403H-4, Blue Buttes, t6/13; cum 128K 11/13;
  • 23455, 1,291, Hess, BB-Budahn-150-95-0506H-2, Blue Buttes, t6/13; cum 121K 11/13; 
  • 23494, 360, CLR, Angus Federal 5-9H, Elm Tree, t6/13; cum 113K 11/13;
  • 23610, 731, CLR, Akron 2-27AH, Banks, t5/13; cum 115K 11/13; 
  • 23495, 240, CLR, Simmental Federal 3-16H, Elm Tree, t6/13; cum 90K 11/13;
  • 23833, 2,653, XTO, Lundin 44X-11C, Siverston, t4/13; cum 103K 11/13;
  • 24218, 997, Slawson, Mooka 4-29-20H, Big Bend, t6/13; cum 108K 11/13
  • 24217, 733, Slawson, Mooka 3-29-20TFH, Big Bend, t6/13; cum 109K 11/13;
  • 24283, 504, CLR, Hawkinson 8-22H, Oakdale, t11/13; cum 33K 11/13;
  • 24384, 1,677, XTO Energy, CArter 14X-12H, Grinnell, t5/13; cum 90K 11/13;
  • 24104, 2,380, XTO Energy, Stenberg 14-10SWH, North Tobacco Garden, t4/13; cum 80K 11/13;
    23113, 1,896, KOG, P Bibler 154-99-1-5-8-15H, Stockyard Creek, t5/13; cum 102K 11/13;
  • 23111, 1,657, KOG, P Bibler 154-99-1-5-29-2H, Epping, t5/13; cum 92K 11/13; 
  • 24385, 1,818, XTO, Carter 14X-32D, Grinnell, t5/13; cum 83K 11/13;
    24405, 2,367, KOG, P. Thomas 153-98-5-3-2-1H, Truax, t4/13; cum 91K 11/13;
  • 23240, 419, Baytex, Marilyn Nelson 29-32-162-98H-1BP, Whiteaker, t12/12; cum 61K 11/13
#23240 is a great well for Baytex.

So, this is just a random note; nothing to follow up on. No news. Just simply looking at some incredible wells that were completed last year.

Ten (10) New Permits -- The Williston Basin, North Dakota, USA; Three More "High-IP" Wells; Statoil Has Another 3,500+ IP Well; A Tangsrud Well Not All That Impressive (Yet)

Active rigs:

Active Rigs19318219916378

Ten (10) new permits --
  • Operators: EOG (4), XTO (3), KOG (2), Hess
  • Fields: Parshall (Mountrail, Lost Bridge (Dunn), Pembroke (McKenzie), Heart Butte (Dunn), Big Stone (Williams)
  • Comments:
Wells coming off the confidential list were posted earlier; see sidebar at the right. 

Six (6) producing wells completed:
  • 24934, 76 (no typo), CLR, Tangsrud 4-1H3, Hayland, t12/14; cum 1K 11/13;
  • 25851, 1,501, XTO, Wallace 21X-2A, West Capa, t12/13; cum --
  • 25149, 2,526, XTO, Wallace 21X-2F, West Capa, t12/13; cum --
  • 24259, 2,966, BR, Glacier 14-9MBH, Clear Creek, t12/13; cum --
  • 22818, 706, CLR, Harms 1-32H, Elm Tree, t12/13; cum --
  • 24362, 3,509, Statoil, Knight 35-26 4H, Banks, t12/13; cum --
Wells coming off the confidential list Tuesday:
  • 24446, drl, SM Energy, Lucille 1-27H, Siverston, no production data,
  • 24564, 1,070, Fidelity, Frederick 3-34-33H, Sanish, t7/13; cum 50K 11/13;
  • 25305, drl, QEP, Paul 2-26-35BH, Grail, no production data, but you know it's gonna be huge;
  • 25551, drl, XTO, Marlene 42X-20H, Blue Buttes, no production data,
  • 25719, 1,210, Whiting, Savannah TTT 41-26H, Sanish, t8/13; cum 52K 11/13;

25719, see above, Whiting, Savannah TTT 41-26H, Sanish

DateOil RunsMCF Sold

 24564, see above, Fidelity, Frederick 3-34-33H, Sanish:

DateOil RunsMCF Sold

Just A Bit Catty 
(no link)

One has to chuckle at the irony. A reader sent me a link to a series of stories the Minneapolis Star Tribune did on the Bakken this past summer/autumn. The series included a number of photographs, many of which appeared in numerous other publications across the country. I particularly enjoyed the photograph with this caption: "Traffic related to servicing the oil boom has increased dramatically, taxing roads that were not designed to carry such a heavy load. These trucks were lined up along a road near Watford City. Photo: Jim Gehrz."

In fact, the roads were designed to carry heavy agricultural loads: wheat, sugar beats, and they've been drilling for oil in North Dakota since 1951. But this is the irony: I assume the photographer is based out of Minneapolis-St Paul, the home of one of the most incredible bridge failures in the nation. According to wiki:
The I-35W Mississippi River bridge (officially known as Bridge 9340) was an eight-lane, steel truss arch bridge that carried Interstate 35W across the Mississippi River in Minneapolis, Minnesota, United States.
During the evening rush hour on August 1, 2007, it suddenly collapsed, killing 13 people and injuring 145. The bridge was Minnesota's fifth busiest, carrying 140,000 vehicles daily. The NTSB cited a design flaw as the likely cause of the collapse, and asserted that additional weight on the bridge at the time of the collapse contributed to the catastrophic failure.
I guess Minnesotans are a) trying to forget that tragedy; b) looking for a highway story that might be worse; and/or, c) just running out of stories in their own backyard, as folks flee "Minne-soak-the-rich."

One Of The First Flights Of The Day For FedEx Starts In Grand Forks, North Dakota

CarpeDiem posted this link; it's quite remarkable. A lot of story lines in this one video:
  • it looks like there are about three daily cycles for FedEx
  • for all the economic, political activity in New England, it seems most of the traffic is south, west
  • mid-Atlantic relatively arid
  • Indianapolis, Dallas, San Francisco, Los Angeles seem to be mini-hubs (Memphis, of course, is hub for FedEx)
CarpeDiem site is here

Reminder: Bakken Product Markets And Takeway Capacity Congress, 2014 -- Denver -- January 29 - 30; January 1, 2014, Set January 1 Record For Gasoline Prices

Reminder: Bakken Product Markets & Takeaway Capacity

January 29 - 30, 2014: Denver, CO.

Statoil's vice president for North America Strategy and Business Development - Midstream, will be the keynote speaker. He will set the stage for discussions on CBR and pipeline out of the Bakken.

Other speakers: CEOs, COOs, and VPs from Enbridge, Hess, ConocoPhillips, Tesoro. 

From the Congress' website:
Just a year ago, it was practically a no brainer to rail Bakken crude to the higher paying Gulf Coast markets, but the recent collapse of the WTI and Brent price differentials has left the industry questioning the long term sustainability of rail.  
To gain clarity on the future viability of rail, existing and new rail and pipeline markets need to be examined side by side, in light of accessibility and transportation costs, to enable E&P operators to optimize routes to market and determine whether moving crude barrels by rail or pipe will yield the highest netback.
Additionally, with increasing regulatory pressure on Bakken operators to minimize flaring, solutions for gas gathering, processing and takeaway infrastructure are needed now more than ever. Bakken players are currently losing too much revenue as a result of flaring, making it essential for producers to ensure pipeline connectivity, capitalize on Gas and NGL production and ultimately, improve overall well economics in light of fluctuating market prices.  
 This should be a great Congress, a great opportunity.


Reminder: the IPs for wells coming off the confidential list over the weekend and today have been posted


Obamanation: how's that renewable energy working out? AAA is reporting that for the fifth straight year, New Year’s Day brought higher gas prices than the year before – and 2014 actually set a record for the highest price for a gallon of gas ever on January 1. But here's the spin: AAA says 2013, with the volatility in gasoline prices, was actually one of the best years ever for motorists. Okay.


On a completely different note, this is really quite incredible. The state that has been among the leaders in socialized health care seems to have dropped the ball with ObamaCare Online Enrollment. From CBSlocal: Oregon's ObamaCare Online Enrollment System still doesn't work more than three (3) months after it was supposed to launch. One word: wow. 

Monday, Monday: More Tea Leaves Suggesting Price Of Oil Will Fall This Year

Top "personal" story: surgeon donates $50 million to my alma mater.
USC will be constructing a new building for bioscience research, thanks in part to a $50-million gift from Gary K. Michelson, a retired orthopedic surgeon and inventor of spinal implants and other medical devices, the university is announcing Monday.
The new, 190,000-square-foot USC Michelson Center for Convergent Bioscience will house up to 30 labs investigating a range of biomedical topics. With groundbreaking expected later this year and completion in three years, it will be located at the southwest quadrant of the main campus south of downtown Los Angeles. Michelson’s $50 million is less than half of the total anticipated cost but was needed to move the project ahead, officials said.
Michelson’s gift is unusual since the 64-year-old West Los Angeles resident did not graduate from USC and previously had little contact with the university. Much of his medical career was spent at Centinela Hospital Medical Center in Inglewood.
Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or what you think you might have read here.

There is a nice post on MLPs over at SeekingAlpha this morning, strictly from an investment point of view. I don't know/follow the contributor. Kinder Morgan is in the news; that's the reason this SeekingAlpha article caught my attention; more on KMI later.  One of several companies the contributor talks about is EPD, a company that has nothing (?) to do with the Bakken:
EPD is exceptionally conservative with its payout, and it now sports a coverage ratio of 1.6x. In other words, while the company only pays out $0.69 a quarter, it has the capacity to payout $1.10 quarterly. Over the past five years, EPD has been growing its cash flow faster than its distribution, so its coverage ratio has continued to climb to higher levels. In 2009, the coverage ratio stood at a more reasonable 1.2x, but thanks to modest distribution growth despite excellent operating performance, investors are getting a smaller share of cash today. As a consequence, EPD yields a more modest 4.3%.

Speaking of Kinder Morgan, RBN Energy continues its excellent series on the company.  Kinder Morgan caught my interest a couple of weeks ago after reading a post at SeekingAlpha suggesting that KMI getting into oil tankers was a strategic mistake for Kinder Morgan. Since then, it looks like my original thoughts are probably not too far off the mark. Here's the RBN Energy link for today's installment.
In December 2013 US Midstream giant Kinder Morgan agreed to spend nearly $1 Billion to get into the oil tanker business by buying two companies that own 5 US registered “Jones Act” vessels and are in the process of building 4 more. These tankers are part of an exclusive fleet of just 42 self propelled ocean going vessels that deliver oil or refined products between US ports. Booming US crude production along with constrained onshore delivery infrastructure have increased demand for tankers that can ship oil along coastal waters. Long-term charter rates for these tankers jumped to over $100,000/day in 2013 compared to an average of $56,000/day in 2012.  Today we begin a blog series looking at the US flagged tanker fleet and plans to expand it by 35 percent in the next 2 years.

The Wall Street Journal

Arctic passage opens challenges for US military. Thinning polar ice expected to give way to new commercial waterways and resource-rich frontier. As previously reported in the blog, the Obama administration has pretty much ceded the Arctic to the Russians, the Danes, the Norwegians, the Canadians, and just about anyone else who might have a claim. Fortunately presidents come, and presidents go.
The 40-year-old Coast Guard icebreaker Polar Star returned to the Arctic Ocean this summer after seven years in semiretirement, charging into a thinning polar ice sheet that U.S. defense officials predict will give way to new commercial waterways and a resource-rich frontier by midcentury.
Navy officials say the Arctic will give the U.S. its first new ocean to police since the annexation of the Pacific Northwest in 1846. As the ice surrounding the North Pole retreats, officials say, commercial shippers will be able to eventually move goods faster between Asia and Europe. More open seas will also give energy companies greater access to offshore oil and gas in regions controlled by the U.S. and estimated by military officials to be worth $1 trillion.
"The inevitable opening of the Arctic will essentially create a new coast on America's north," said Adm. Jonathan Greenert, the Navy's top officer.
Even though the anticipated change is years away, Navy and Coast Guard officials say the U.S. needs to prepare now to patrol and defend the new waterways—designing ice-resistant ships and expanding Arctic naval exercises—when military scientists predict a new expanse of water freed of ice.
Wow, this is incredible. Front section news: a $100 million impressionist gift for Denver.
The Denver Art Museum is set to announce Monday the largest donation in its history—a gift of 22 paintings worth more than $100 million that will nearly triple the size of its Impressionist collection.
The gift, bequeathed by Denver philanthropist Frederic Hamilton, includes what will be the museum's first Vincent van Gogh canvas, "Edge of a Wheat Field with Poppies," as well as four works by Claude Monet and paintings by masters such as Paul Cézanne, Edouard Manet and Auguste Renoir.
"It's a game changer," said museum director Christoph Heinrich. "It adds a lot of value and prestige to the museum."
The gift, which increases the museum's tally of Monet canvases to six, makes this one of the strongest Impressionist collections in the West, Mr. Heinrich said. It's still no rival to institutions such as the Museum of Fine Arts, Boston, the Art Institute of Chicago and the Metropolitan Museum of Art in New York, whose Impressionist collections can compete with those of the Musée d'Orsay in Paris.

Now that Michelle's cronies have made their millions, President Obama will turn over the "troubled" government healthcare website to the professionals. Accenture is tasked with fixing website. Good luck.

Christie not sure when he learned of bridge lane closures. He will know more once the shredding is completed. Remember: the debacle occurred over a four-day period. Certainly by the second day he was asking questions. If not, he was derelict in simply not trying to fix the problem immediately.

Has Italy figured it out? Italy plans to step up its drilling program. Apparently Italy has the third-largest crude reserves in Europe.

Lots of automotive news in the second section but the automotive industry has never captured my attention, much. The general gist of all the articles suggest a) not much movement toward all-electric vehicles; b) lots of movement toward more automobile manufacturing in US; c) Ford seems to lead the pack among US manufacturers (yes, there are two: GM and Ford), but most everyone else is now building in the US, probably because a) lots of cheap energy; and, b) the US economy, along with China's, is about the only economy that shows any life.


From "Overheard":
The oil business is no stranger to hedging. Neither are the analysts who track it.
Sanford C. Bernstein has been consistently bullish on oil prices even as others, notably , foresee weakness.
Yet with oil prices down 6% this year, even Bernstein seems to be entertaining some doubts.
On Friday, it put out a report called "What a Conceivable (but Still Unlikely) Bear Case for 2014 Global Oil Price Looks Like."
As the caveats indicate, Bernstein is nowhere near reversing its positive view. Rather, it analyzes how three big swing factors—Libya, Iraq and Iran—might, just might, add to oil supply this year, moderating prices. Examining potential outcomes, Bernstein estimates they might boost the world's effective oil capacity by 450,000 barrels a day. That would be meaningful: Effective spare capacity stands currently at about 3.4 million barrels a day. Hence, Bernstein sees "considerable volatility for shorter-term investors"; in plain English, oil could fall in 2014.
But it remains "bullish long term oil price." In Wall Street-ese, that is a way of saying this year is a buying opportunity. Who says doubt discourages investment?
I always like buying opportunities.

The Los Angeles Times

Disclaimer: this is not an entertainment site. If you want to read about Diane Keaton's bizarre outburst at the Golden Globes, google it. 

There are a lot of stories on Jacqueline Bisset's speech last night at the Golden Globes. I, for one, enjoyed it, and was intrigued by her. I don't know her well; I doubt I have seen her in more than one or two movies; I really don't know anything more about her than what I read at wiki, but she is clearly a survivor. It was back in 1968 that she replaced Mia Farrow to play opposite Frank Sinatra. Anyone who learns to speak French fluently as a second language and is educated in French in London is pretty high on my list.

I wish Mr Dern had won over Mr DiCaprio. Mr Dern and I have a lot in common. Mostly he is old and he shares my first name.

Tina Fey and Amy P. were so much more subdued than I expected. I was pleasantly surprised. Is it just me or is Tina Fey getting prettier with age?

The Los Angeles Times is correct: "Matthew McConaughey was in a zone of his own." I could have listened to him for another 30 minutes.