Friday, January 31, 2014

Another Spill -- This One Near Jackson, Mississippi

Reuters via Rigzone is reporting:
A Canadian National Railway Co train carrying fuel oil and other hazardous materials derailed and was leaking in southeast Mississippi on Friday, forcing the evacuation of nearby residents, officials said.
No one was injured in the incident which involved the derailment of 21 railcars, eight of which have spilled their contents, a Canadian National Railway spokesman said. Several of the cars were carrying hazardous materials including fertilizer and methanol, but there was no fire, he said.
And this is why it's going to be difficult to come up with tighter standards on rail cars. It's not just Bakken oil. 

For QEP Grail-Bakken Mineral Owners

Mineral owners involved in making a decision regarding "unitization" of the Grail-Bakken as proposed by QEP might want to read the February NDIC hearing dockets in light of that proposal or vice versa, specifically, perhaps, looking at cases: 21824, 21825, 21826, 21828, 21758, 21755, 21756, 21751, 21757.

NDIC February, 2014, Hearing Dockets

Wednesday, February 26, 2014

21748, NDIC, Patent Gate-Bakken, amend stratigraphic limits, McKenzie County,
21285, cont'd
21645, cont'd
21749, Statoil, Williston-Bakken, proper spacing, Williams,
21351, cont'd
21750, CLR, Avoca-Bakken, redefine field limits, Williams,
21646, cont'd
21751, CLR, Battleview-Bakken, amend field rules, Williams,
21752, CLR, Ellisville-Bakken, alter definition of the stratigraphic limits, Williams,
21753, CLR, Lindahl-Bakken, alter definition of the stratigraphic limits, Williams,
21754, CLR, Tioga-Bakken, alter definition of the stratigraphic limits, Burke, Mntrl, Wms
21755, CLR, Leaf Mountain-Bakken, spacing for Vibe #1, #25799, Burke,
21756, CLR, Oakdale-Bakken, spacing for Whitman #3, #20212, Dunn,
21757, CLR, Charlson and/or Elm Tree-Bakken, establish an overlapping 2560-acre unit on a section line between an existing  640-acre unit and a 1280-acre unit, McKenzie
21758, CRL, Elm Treek, reducing the setback rules of multiple sections, McK, Mntrl
21650, cont'd
21651, cont'd
21476, cont'd
21478, cont'd
21474, cont'd
20926, cont'd
20927, cont'd
20928, cont'd
15225, cont'd
14935, cont'd
21629, cont'd
21630, cont'd
21631, cont'd
21759, Forestar Petroleum, Bailey, Moccasin, and/or Wolf Bay-Bakken, establish a 1280-acre unit, 1 well, Dunn,
21622, cont'd
21625, cont'd
21627, cont'd
21628, con'td
21287, cont'd
21760, WPX, McGregory Buttes-Bakken, establish a 640-acre unit, 4 wells; establish a 1280-acre unit, 7 wells, Dunn
21761, WPX, Van Hook-Bakken, establish a 2560-acre unit, 14 wells, 5/6/7/8-150-91, McLean;
21642, cont'd
21643, cont'd
21762, Sinclair, Cherry Creek, recomplete the Robert Peterson #11 into the Souris River Formation,  McKenzie
21763, Corinthian, North Souris-Spearfish, rework the Corinthian Skarphol #8, water injection, Bottineau
21765, Encore, Tree Top-Madison, recomplete the Anheluk 24; Billings
21796, Cedar Hills, Denbury, convert CHSU Clark #31 to SWD, Bowman,
20658, cont'd
21358, cont'd
21359, cont'd
21766, Samson Resources, commingling, Divide,
21767, Samson Resources, commingling, Divide,
21768, Samson Resources, commingling, Divide,
21769, CLR, pooling,
21770, CLR, pooling,
21771, CLR, Alkali Creek-Bakken, existing 1280-acre, 14 well, McK, Mntrl
21772, CLR, commingling, Dunn
21773, CLR, commingling, Mountrail,
20814, cont'd
20815, cont'd
21581, cont'd
21375, cont'd
20816, cont'd
21774, Emerald, Boxcar Butte-Bakken, two existing 1280-acre units; 7 wells each, McK
21775, Statoil, pooling,
21776, Statoil, pooling
21777, Corinthian, pooling,
21778, Corinthian, pooling,
21779, Corinthian, commingling, Bottineau,
21780, SHD, pooling,
21781, Newfield, risk penalty legalese, Bernice #2, McKenzie,
21782, Fidelity, risk penalty legalese, Shirley Anne #34-9H, Mountrail,
21783, Fidelity, Stanley-Bakken, flaring,
21784, Fidelity, commingling, Stark,
21785, Hunt, risk penalty legalese, Frazier #1, Divide,
21786, Hunt, risk penalty legalese, Hawkeye #1, Divide,
21787, WPX, Reunion Bay-Bakken, flaring, Mountrail,
21788, WPX, Reunion Bay-Bakken, flaring, Mountrail,
21789, WPX, Reunion Bay-Bakken, flaring, Mountrail,
21790, Legacy, SWD, Bottineau,
21791, Enduro, Newburg-Spearfish-Charles Unit J-706, water injection, Bottineau,
21792, Enduro, Newburg-Spearfish-Charles Unit J-708, water injection, Bottineau,
21793, Enduro, Newburg-Spearfish-Charles Unit K-707, water injection, Bottineau,
21794, Enduro, Newburg-Spearfish-Charles Unit L-708, water injection, Bottineau,
20975, cont'd,

Thursday, February 27, 2014 

21797, Zavanna, objection to Emerald Oil imposition of risk penalty proceeds, Pirate wells, McKenzie
21798, Spring Creek Exploration, objection to Emerald Oil imposition of risk penalty proceeds, Excaliber and Caper wells, McKenzie,
21799, WPX, revoke the Enerplus permits to drill several wells; Dunn
21800, WPX, Spotted Horn, amend, establish one new overlapping 1280-acre unit; 14 wells; 
21801, Apollo, waste processing plant, McKenzie,
21609, cont'd
21424, cont'd
21802, EOG, Lake Trenton-Bakken, spacing and field limits, Williams,
21803, Oasis, Foreman Butte-Bakken, flaring, McKenzie,
21804, CLR, Pleasant Valley-Bakken, spacing and field limits, Mntrl, Wms
21805, Hess, Ray-Bakken, establish an overlapping 2560-acre unit, 1+ wells, Mntrl
21807, Hess, Sandrocks-Bakken, establish an overlapping 2560-acre unit, 1+ wells, Mntrl
21619, cont'd,
21471, cont'd,
19399, cont'd
21808, Petro Harvester, Portal-Madison, establish two 320-acre units; 1 well each, Burke,
21809, Petro-Hunt, Charlson-Bakken, establish a 2560-acre unit, 3 wells, McK, Wms
21810, Petro-Hunt, Charlson-Bakken, establish a 2560-acre unit, 3 wells, McK, Wms
21811, Petro-hunt, Charlson-Bakken and Keene-Bakken/Three Forks, establish an overlapping 2560-acre unit, 2 wells, McKenzie,
21812, Petro-Hunt, Charlson-Bakken, 4 wells on an overlapping 3840-acre unit, McKenzie,
21813, Petro-Hunt, Charlson-Bakken, establish an overlapping 2560-acre unit, 2 wells, McK,
21814, Petro-Hunt, Charlson-Bakken, establish an overlapping 2560-acre unit, 2 wells, McK,
21815, Petro-Hunt, Charlson-Bakken, 6 wells on each of two existing 1280-acre units, McK
21816, Petro-Hunt, Charlson-Bakken, establish an overlapping 2560-acre unit; 2 wells; McK
21817, Petro-Hunt, Charlson and/or Elm Tree-Bakken, establish an overlapping 2560-acre unit, 2 wells, McKenzie
21818, HRC, Antelope-Sanish, establish an overlapping 2560-acre unit, 1+ wells, McK,
21819, QEP, Spotted Horn, the Clarks Creek, and/or the Blue Buttes-Bakken, establish an overlapping 2560-acre unit; 1+ wells, McKenzie,
21820, QEP, Spotted Horn and/or Blue Buttes-Bakken, establish an overlapping 2560-acre unit, 1+ wells, McKenzie,
21821, QEP, Blue Buttes-Bakken, establish an overlapping 2560-acre unit, 1+ wells, McKenzie,
21822, MRO, Murphy Creek-Bakken, establish seven overlapping 2560-acre units, 1+ wells each, Dunn,
21823, OXY, Cabernet-Bakken, flaring, Dunn,
21605, cont'd
21824, Whiting, Park-Bakken, establish six overlapping 2560-acre units; 1 well each, Bilings,
21825, Whiting, Park and/or Bell-Bakken, establish three overlapping 2560-acre units, 1 well each, Stark, Bilings
21826, Whiting, Bell-Bakken, establish nine overlapping 2560-acre units, 1 well each, Stark
21827, Whiting, Bell-Bakken and/or Zenith-Bakken, establish an overlapping 2560-acre unit, Stark
21828, Whiting, Zenith-Bakken, establish four overlapping 2560-acre units; 1 well each, Stark,
21829, Whiting, Fryburg-Bakken, establish an overlapping 2560-acre unit; 1 well, Billings,
21830, Whiting, Fryburg and/or Bell-Bakken, establish an overlapping 2560-acre unit, 1 well, Stark,
21611, cont'd
21831, North Plains, pooling, Divide,
21832, BR, Blue Buttes-Bakken, 14 wells on each 1280-acre unit within zones III, IV, V, VI, VII, Mckenzie,
21833, BR, Camel Butte-Bakken, 14 wells on each 1280-acre unit within Zone II, McKenzie
21834, BR, Dimmick Lake-Bakken, 14 wells on each 1280-acre unit within Zone I and II, McK,
21835, BR, North Fork-Bakken, 14 wells on each 1280-acre unit within Zone IX, McKenzie,
21836, BR, pooling, McKenzie,
21837, BR, pooling, McKenzie,
21838, BR, pooling, McKenzie,
21839, BR, pooling, McKenzie,
21840, BR, pooling, McKenzie,
21841, SM Energy, Bear Den-Bakken, 7 wells on a 640-acre unit, 25-149-96, McKenzie;
21842, SM Energy, pooling, McKenzie,
21843, SM Energy, pooling, McKenzie,
21844, SM Energy, pooling, McKenzie,
21845, SM Energy, pooling, McKenzie,
21846, SM Energy, commingling, Divide,
21847, KOG, pooling, Williams,
21848, KOG, pooling, Williams,
21849, Oasis, Sanish-Bakken, 21 horizontal wells on a 640-acre unit, 4-153-93, Mountrail,
21850, Oasis, Enget Lake-Bakken, 16 wells on some or all of the 1280-acre units, Mountrail,
21851, MRO, McGregory Buttes-Bakken, ten wells on a 2560-acre unit, Dunn,
21852, MRO, Chimney Butte-Bakken, 8 wells on a 1280-acre unit, Dunn
21853, MRO, pooling, Williams, 
21854, MRO, pooling, Dunn,
21855, Whiting, Bell-Bakken, 6 wells on each of 3 1280-acre units, Stark,
21856, Whiting, pooling, Golden Valley,
21857, Whiting, pooling, Stark,
21858, Hess, Tioga-Bakken, 5 wells on each of 2 1280-acre units; Williams,
21859, Hess, East Tioga-Bakken, 5 wells on a 1280-acre unit, Mountrail,
21860, Hess, Ross-Bakken, 4 wells on a 1280-acre unit; 5 wells on a 1280-acre unit; 6 wells on a 1280-acre unit, Mountrail,
21861, Hess, Capa-Bakken, 7 wells on each of 2 640-acre units; Williams,
21862, Hess, Alger-Bakken, 10 wells on a 1280-acre unit, Mountrail,
21863, Hess, Alkali Creek-Bakken, 4 wells on a 1280-acre unit, Mountrail,
21864, Hess, Robinson Lake-Bakken, 12 wells on a 1280-acre unit, 15/22-154-93, Mntrl,
21865, Hess, Robinson Lake-Bakken, 13 wells on a 1280-acre unit, 29/32-154-93, Mntrl,
21866, Hess, Truax-Bakken, 8 wells on a 1280-acre unit, McKenzie, Williams,
21867, Hess, Blue Buttes-Bakken, 10 wells on a 2560-acre unit, McKenzie,
21868, Hess, pooling, Williams,
21869, Hess, pooling, Williams,
21870, Hess, pooling, Williams,
21871, Hess, pooling, Williams,
21872, Hess, pooling, Williams,
21873, Hess, pooling, Williams,
21874, Hess, pooling, Williams,
21875, Hess, pooling, Williams,
21876, Hess, pooling, Mountrail,
21877, Hess, pooling, Mountrail,
21878, Hess, pooling, Mountrail,
21879, Hess, pooling, Mountrail,
21880, Hess, pooling, Mountrail,
21881, Hess, pooling, Mountrail,
21882, Hess, pooling, Williams,
21883, Hess, pooling, Williams,
21884, Hess, pooling, Mountrail,
21885, Hess, pooling, McKenzie,
21886, Hess, pooling, McKenzie,
21887, Hess, pooling, McKenzie,
21888, Hess, pooling, McKenzie,
21889, Hess, pooling, McKenzie,
21890, Hess, pooling, McKenzie,
21891, Hess, pooling, McKenzie,
21892, Hess, pooling, McKenzie,
21893, Hess, pooling, McKenzie,
21894, Hess, pooling, McKenzie,
21895, Hess, pooling, Dunn,
21896, Hess, pooling, Dunn,
21897, Hess, pooling, Dunn,
21898, Hess, pooling, Dunn,
21899, Hess, pooling, Dunn,
21900, Hess, pooling, Dunn,
21901, Hess, pooling, Dunn,
21902, Hess, pooling, Dunn,
21903, Hess, pooling, Dunn,
21904, Hess, pooling, Dunn,
21905, Hess, pooling, Dunn,
21906, Hess, pooling, Dunn,

Oasis: 21 Wells In One 640-Acre Drilling Unit


August 7, 2019: production data update; otherwise no changes; there appears to be no change in the map at the NDIC. 

July 25, 2016: these wells were updated this date; note that SI/NC wells have now become TATD. Screenshot as of this date:

November 26, 2015: in addition to the four wells (two 2-well pads) noted in the original post, there are now eight more wells, all short laterals in this section:
  • 25319, 1,969, Oasis, Christa 5393 12-9B, ICO, t7/13; cum 138K 6/19; down to 800 bopm;
  • 25320, 2,009, Oasis, Kray 5393 12-9T, ICO, t7/13; cum 231K 6/19; nice well; 2,000 bopm;
  • 29342, SI/NC-->TATD, Oasis, Helix 5393 41-4 3B, 2/15; 12/16;
  • 29343, SI/NC, Oasis, Helix 5393 41-4 4T2, 2/15; 12/16;
  • 29344, TATD, Oasis, Helix 5393 41-4 5T, 7/16; 12/16;
  • 29345, SI/NC-->TATD, Oasis, Helix 5393 41-4 6T3, 1/15; 12/16;
  • 29346, SI/NC-->TATD, Oasis, Helix 5393 41-4 7B, 1/15; 12/16;
  • 29347, SI/NC-->TATD, Oasis, Helix 5393 41-4 8T2, 1/15; 12/16; 
Original Post
Folks may want to re-read the "Bentek 2.2 million" study while reading the post below. The truth is out there.

Disclaimer: this post has not been edited or thought about much. It is not ready for "prime time" but regular readers know the routine. I assume there are errors that will need corrections, and, of course, most of it is opinion.

This should get some folks talking, from the February NDIC hearing docket:
  • 21849, Oasis, Sanish-Bakken, 21 horizontal wells on a 640-acre unit, 4-153-93, Mountrail,
[For newbies: when the drilling started in the Bakken back in 2007, the "word on the street" was one well per section. Folks got excited when they heard talk of four wells in a 1280-acre spacing unit. Now: 21 wells in one section, one 640-acre spacing. Who wudda thought -- just in the past three or four years. I think it's incredible. And that's why the Bakken never ceases to amaze me.]

This section (4-153-93) and the section directly south (9-153-93) are the only two sections still spaced as 640-acre drilling units in this immediate area: "everything else" in the immediate area is 1280-acre unit spacing.

Currently in section 4-153-93 (two two-well pads)
  • 24760, 1,654, Oasis, Knox 5393 44-4T, t7/13; cum 141K 6/19; down to 600 bopm;
  • 24761, 1,957, Oasis, Gloria 5393 44-4B, t7/13; cum 163K 6/19; down to 800 bopm;
  • 21767, 1,246, Oasis, Helix 5393 43-4H, t2/12; cum 200K 6/19; down to around 500 bopm;
  • 25025, 1,164, Oasis, Folda 5393 43-4T, t7/13; cum 153K 6/19; down to less than 1,000 bopm;
640 acres / 21 wells = 30-acre spacing. 

Some random comments follow:
  • Four Bakken formations: middle Bakken, TF1, TF2, TF3 = 6 wells in MB; 5 wells in each of the other three.
  • Except that it sounds incredible (21 wells in 640-acre spacing), the density is the same as being tested by CLR and KOG on 1280-acre spacing units.
  • Regardless of how many wells one drills in a specific area (aka "well density), the fact is, operators are not going to drill wells if they are not economical. My hunch is that operators in the Bakken won't drill a well if they don't expect a EUR of at least 450,000 bbls. 
  • EOR is about the only "thing" left to do when one gets to 30-acre spacing (20 wells/640 acres). 
  • 21 wells x 450,000 bbls x $50 / 640 acres = $740,000 / acre; and that's just primary production. That does not include EOR. 
  • The jury is still out, but there are operators suggesting that fracking a new well near an existing well improves the production from the existing well. I said that from the beginning. So, we'll see. 
  • By the time they get to these 17 new wells, the operator will have had several years of experience; by the time they get to these 17 new wells, the operator will have had the opportunity to study "best completion methods" available. 
  • Think of the cost savings. 
  • One rig, 17 wells; about 17 months. Full-time employment for a lot of folks for almost two years, and if it works, then do the same thing in the 640-acre drilling unit to the immediate south.
  • 17 wells x $8 million = $140 million. 
  • This section is two miles west of the incredible Whiting Sanish.

Belfield Utilities "About Maxed Out"

The Dickinson Press is reporting:
A representative from American Landmark Group, which is planning a 42-acre “Belfield Crossing” multi-use development north of downtown, informed city representatives that the development would require new utilities infrastructure because the city is almost maxed out of power and natural gas.
Zoning members seemed somewhat surprised to hear how close the city was to being maxed out. But MDU Resources Group has plans for upgrades to both natural gas and electricity for Belfield.
Belfield Mayor Leo Schneider said he too didn’t know much about the city’s utilities situation until ALG brought it to the zoning board’s attention.
Belfield is the southern gateway to the North Dakota Bakken. Driving cross-country from the south, Belfield is always, always a welcome site: I know I am back home. 

Chevron Reports: Less Production, Higher Costs; Exploration Costs Double From Year Ago; Opportunity For Investors


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

Saturday, February 1, 2014: investors are noting the opportunity to invest in Chevron.
4-year high yield: Chevron is currently yielding about 3.60%. Chevron last yielded more than 3.5% back in August 2010. Yes, not even during the 2011 October mini-crisis was Chevron yielding this much. Needless to say, Chevron has continued increasing its annual dividends through thick and thin. As a comparison, Exxon Mobil yields just 2.70%, in spite of its own recent share price depreciation.
Original Post
MarketWatch is reporting:
Chevron reported its fourth-quarter profit fell 32% to $4.93 billion, or $2.57 a share, from $7.25 billion, or $3.70 a share, a year earlier.
Operating revenue fell to $53.95 billion, down 4% from $56.25 billion a year earlier, the oil company said Friday.
Total revenue, which includes income from equity affiliates, was $56.16 billion, down from $60.55 billion.
Analysts had expected earnings of $2.58 a share on revenue of $66.41 billion, according to FactSet. Production fell to 2.58 million barrels of oil-equivalent production per day, down from 2.67 million barrels per day. Exploration expenses rose to $726 million, roughly double from a year ago. Shares in Chevron were down 0.9% in premarket trading.
Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or think you may have read here. 

From AP from Rigzone:
Chevron profit fell 32 percent in the fourth quarter on lower oil and gas production and lower prices for refined fuels relative to the cost of crude.
Chevron Corp. reported Friday net income of $4.93 billion on revenue of $53.95 billion for the final three months of 2013. That's down from net income of $7.25 billion on revenue of $56.25 billion during the same period of 2012.
The nation's second-biggest oil company earned $2.57 per share, a penny less than analysts polled by FactSet had expected. Chevron shares were down 3 percent to $112.93 as the market opened. Chevron had signaled that results would be relatively weak in a recent update for investors, and the company met those diminished expectations, says Brian Youngberg, an analyst at Edward Jones. He called the results "not disappointing, but more like mediocre."
Despite the U.S. oil and gas boom, Chevron's domestic production fell 4 percent in the quarter as increases in Pennsylvania and Texas were offset by declining production in older fields. Chevron's international production fell 3 percent in the quarter.
Chevron, based in San Ramon, California, has been championed by investors in recent years for providing the best growth among major integrated oil companies. But growth stalled last year and the company said Friday that production would rise less than 1 percent in 2014. Better growth is now expected in 2015 and 2016.

Unions Starting To Feel The Pinch Of ObamaCare


February 1, 2014: union labor officials say President Obama betrayed them in health-care rollout -- The Washington Post. I'm shocked! I'm shocked! The unions believed another honest Abe from Chicago. LOL.

January 31, 2014: the contract was approved. The Bismarck Tribune is reporting:
The contract includes 3 percent pay raises and a company-matched 401K. The 3 percent has been the standard increase for utilities employees across the state, ...
In exchange, workers have agreed to pay 15 percent to 20 percent of health care costs, Keslch said during the interview.
Keslch said in the interview Minnkota was the last power company still paying the full cost of health care for employees. Others companies’ unionized employees pay a portion of health care. All of Minnkota’s other employees across the state were paying a portion of their health care already. 
Thank you, Mr Obama for bringing the reality of health care costs to the union.

Original Post

Technically, this has absolutely nothing to do with ObamaCare ... yet. But ObamaCare provides the top cover that was needed by corporations to do this. The Bismarck Tribune is reporting on contract negotiations at MinnKota:
Kelsch said the most concern was with health care. Depending on their wages, employees will contribute 15 to 20 percent of the cost of their health care coverage. In the past the employees at the plant had not paid any of their health care costs.
Kelsch said Minnkota was the last power company still paying the full cost of health care for employees. Others, like Basin Electric Power Cooperative and Great River Energy employees, also paid a portion of health care. All of Minnkota’s other employees across the state were paying a portion of their health care already.
Kelsch said the change is still going to hit employees hard because they are going from zero cost. For example, the cost of a family plan will go from nothing to $275 a month.
A 401K with 2 percent company matching was added to the offer, something Minnkota hasn’t had for plant employees in the past. The company’s two retirement offerings will go unchanged.
A Note to the Granddaughters

The company my son-in-law works for offers a similar company-wide 410K matching program but with no limitations placed by the company (limitations placed by the IRS, however). I feel so strongly about the importance of a retirement program, I told my daughter I would cover (or "match") whatever he puts into their 401K by sending an equal amount to them each month. They signed up but never told me. I had to ask. It's a win-win for all of us. I feel good, and they have an additional retirement program. My first check goes to them next month.

Venezuela Faltering


Updates: now at this link

March 30, 2017: court gives "absolute" power to Maduro; this is pretty much one-man rule. The "new" Fidel Castro.

May 13, 2016: president declares 60-day state of emergency.

May 9, 2016: more of the same. No end in sight

April 28, 2016: Venezuela does not have enough money to pay for the ink and paper required to print more money.

February 15, 2016: Venezuela's lights go out.

February 3, 2016: Venezuela's crude oil production falls short; must import oil

December 11, 2015: EIA update on Venezuela; may hold 513 billion bbls of oil

December 2, 2015: bartering surges in Venezuela as things go from bad to worse

February 17, 2014: it looks like Venezuela is about ready to implode. Bloomberg is reporting: government forces and opposition forces preparing to take to the street to rumble. This reminds me of scenes in Dr Zhivago, the Bolshevik revolution. The DrudgeReport headline, the big headline for the day: "Venezuela on the brink." I posted the original post (Venezuela faltering) on January 31, 2014, over two weeks ago. Glad to see Drudge is finally picking up on the story. LOL. Venezuela isn't selling much oil any more, but all things being equal, this should support oil prices.

February 4, 2014: Bloomberg is reporting:
Venezuela’s plummeting oil sales to the U.S., its biggest export market, are exacerbating a collapse in the nation’s debt securities.
Bonds issued by Venezuela sank 3 percent on Jan. 31, a day after data released by the U.S. Energy Information Administration showed that 2013 energy sales to the country are headed for a 28-year low. The sell-off pushed losses this year to 12.4 percent, more than three times the average 3.93 percent drop among notes from the least-creditworthy developing nations, according to data by Bloomberg.
The tumble in oil exports, Venezuela’s biggest source of dollars, comes as President Nicolas Maduro faces a shortage of U.S. currency that’s caused consumer prices to soar 56 percent and foreign reserves to plunge to a decade-low of $21 billion.
Petroleos de Venezuela SA, the state-run oil producer known as PDVSA, is sending hundreds of thousands of barrels a day to China to repay loans totaling more than $40 billion since 2008, at a time when its production is shrinking.
Original Post

Warming the cockles of my heart:
“Venezuela is losing out by selling crude to China, which is a market where they are netting back a lower amount of money,” John Auers, a senior vice president at industry consultant Turner Mason & Co., said by telephone from Dallas. “They have been doing it in spite of themselves, as they do not want to sell to the U.S.” 
By the way, wasn't Venezuela the country that gave free heating oil to Massachusetts residents?

It was never my impression that Venezuela, under Marxist leadership, was all that interested in making money in the first place. Whatever.

So, if they are making less money selling to China, why are they doing it? 

Here's the rest of the story being reported by Bloomberg:
Venezuelan energy sales to the U.S. are heading for the lowest levels in 28 years as President Nicolas Maduro steps up shipments to his main lender China and the shale boom floods North American refineries.
Venezuelan exports of crude and petroleum products to the U.S. averaged 792,000 barrels a day in the first 11 months of 2013, which would be the lowest annual rate since 1985, according to data published yesterday on the U.S. Energy Information Administration’s website.
State-run Petroleos de Venezuela SA is sending hundreds of thousands of barrels a day to China to pay back government loans. At the same time, refiners along the U.S. Gulf Coast are sourcing more domestic supply as a surge in drilling shale rock sends output to the highest in a quarter-century. 
I wonder if Jane Nielsen is reading this. For newbies, Jane was the individual who famously said the Bakken might have some oil, but it won't make a difference. LOL. Search for her on the blog. She shows up often.

For Investors Only

National Oilwell Varco beats by 17 cents.

Dividend watch -- some kind of record: 25 companies declare increased dividends, including Wellpoint which will increased health care premiums 36% in California. Something tells me this will catch the eye(s) of the California regulators. Others raising their dividends:
  • California Water Service Group 
  • DCP Midsream Partners
  • Dow Chemical
  • Dupont Fabros Technology
  • Energy Transfer Partners
  • Fidelity National
  • Magellan Midstream
  • Praxair
  • Sunoco Logistics Partners
  • Tupperware Brands Corp

Job Watch: US Job Market Has Improved So Much The President Now Makes That His Top Priority

Weatherford, after a poor earnings report, will cut 7,000 jobs.
Oilfield services company Weatherford International Ltd said it would cut 7,000 jobs and warned that its fourth-quarter profit would miss its forecast, hurt by severe winter in North America and operational disruptions in the Middle East.
The company, which had about 70,000 employees at the end of 2012, said in November profitability at its North American operations would improve in the fourth quarter.

Talk about cognitive dissonance: for the past four years I've read nothing but positive reports from Reuters, Bloomberg, and the White House about how the job market is improving. Even yesterday, when the number of first time applicants for jobless benefits surged, Reuters said it was a sign that the job market was healing. I can't make this stuff up.

But now, after all these reports about how well the job market is, the headline story over at Yahoo!Finance: Obama brings CEOs to Washington, asking for help hiring long-term jobless. Three quick points of advice:
  • substitute a mirror for the teleprompter
  • think like a businessman, not a lawyer (or community organizer)
  • issue an executive order to fast-track Keystone XL to show times have changed

Friday -- Last Day Of January

Active rigs:

Active Rigs19018520416390

RBN Energy: a brief history of hydraulic fracturing.

The Wall Street Journal

US says Syria delaying disarmament. I'm shocked! I'm shocked!

US starts to hit growth stride. I guess that's why the DOW is down 150 points in pre-market futures.

Looks like bondholders will get the short end of the stick (again). Detroit debt proposal favors pension plans.

Relief for kids with peanut allergy. Children with peanut allergies who were fed small but escalating amounts of peanut flour were able to eat a significant quantity of peanuts with no reaction, a new study found.

I love the euphemism ("misstatement"): Texas Democratic gubernatorial candidate Wendy Davis finds herself on the defensive amid criticism that she has exaggerated her story of being a single mom who rose from a trailer park to Harvard Law School. I don't even know where to begin.

Amazon posted a big jump in revenue but the results missed estimates. Result: shares plummet.

The Los Angeles Times

Anthem will raise premiums as much as 25%: up to 365,000 Californians with older, individual Anthem health insurance policies -- unchanged by Obamacare -- are subject to the rate increases. There are two story lines here that probably aren't discussed: a) the insurance industry is now starting to get bashed, as predicted, taking the heat for Obamacare; and, b) they are raising the prices because these older policies are needed to subsidize the newer policies required by Obamacare. The LA Times is technically correct: the premiums are not increasing because th policies have changed to comply with Obamacare, but rather to help subsidize Obamacare in gneral. By the way, why are these older policies allowed if they don't meet Obamacare requirements?
Walter and Kathy Warner of Westlake Village are facing a 25% rate increase, for a total of $1,822 per month. Their premiums had already jumped 53% since 2010, not including this latest change.
The California Department of Insurance and the state Department of Managed Health Care are reviewing Anthem's proposed increase, and they are awaiting additional information from the company. Anthem is a unit of WellPoint Inc., the nation's second-largest health insurer.
The Affordable Care Act makes it easier for people in this situation to switch coverage because insurers can no longer deny applicants on the basis of preexisting conditions or charge them more because of their medical history. But changing plans isn't an appealing option for some consumers who like the benefits they have now and worry about losing access to their doctors.
Anthem Blue Cross said its plan to raise rates reflects that escalating healthcare costs are an economic reality industrywide. The company said customers do have new options thanks to the healthcare law.