Tuesday, March 25, 2014

Another Huge COP (BR) Archer Well; Fourteen (14) New Permits -- The Williston Basin, North Dakota, USA; Houston Ship Channel Slowly Re-Opening

Active rigs:

Active Rigs198186206170105

Fourteen (14) new permits --
  • Operators: Hess (5), Emerald (4), Oasis (3), Whiting (2),
  • Fields: Ray (Williams), Park (Billings), Pierre Creek (McKenzie), Fryburg (Billings), Robinson Lake (Mountrail), Siverston (McKenzie) Boxcar Butte (McKenzie), Beaver Lodge (Williams)
  • Comments:
Wells coming off the confidential list were posted earlier; see sidebar at the right.

Wells coming off the confidential list Wednesday:
  • 24491, drl, CLR, Durham 5-2H, North Tobacco Garden, no production data,
  • 25831, drl, BR, Sunline 21-1TFH-4SH, Clear Creek, no production data,
  • 26007, 2,592, BR, Archer 24-25TFH, Charlson, t2/13; cum --
  • 26314, drl, XTO, Kanyer 11X-15A, Grinnell, no production data,
Comment: there may be no production data for these wells, but you just know the two BR wells will very nice wells.

Comment: For all the permits CLR has, and all the wells it drills, I am always surprised we see so few CLR coming off confidential lists, or so it seems. KOG and BR seem to be very, very active. XTO is active. Whiting, of course, is active. Oasis seems to come in spurts. Just idle chatter.

Houston Ship Channel Slowly Re-Opening; Queue 100 Ships

Reuters/Rigzone is reporting:
The Houston Ship Channel, a critical waterway for oil shipments, gradually began re-opening on Tuesday after a four-day closure that forced at least one big refiner to cut output and caused a backlog of over 100 vessels.
The Channel, which shut on Saturday due to an oil spill, has re-opened for all outbound ship traffic while the Intercoastal Waterway also has opened to eastbound traffic, but not westbound, the Coast Guard said around midday on Tuesday. Authorities had earlier allowed limited barge traffic to resume.
The unusually lengthy closure of the waterway, which connects the Gulf of Mexico to inland terminals and facilities, halted imports of crude to refiners that produce more than one-tenth of the country's fuel and delayed exports of some products. More than 100 large vessels, many of them oil tankers, had been queuing up on either side of the channel.
The Coast Guard said planes started flying the first of three flights over the affected area across Galveston Bay to determine the location of the spill of 4,000 barrels, or 168,000 gallons (636,000 liters), of heavy fuel oil after an oil barge and a cargo ship collided on Saturday.

Halcon Presenting At Howard Weil Conference; HK Drills Fastest 10K Lateral Ever Drilled In FBIR, The Bakken, North Dakota: Also, Record In Williams County; Well PayOut In Six Months (Bakken); Global Warming Could Set Records This Week

Don just sent me this Halcon presentation (PDF).

I am going through it now. A big "thank you" to Don.

Disclaimer: I did this quickly and there may be errors. Note -- one cannot compare certain data points between the Bakken and TMS

Some data points:

Three plays: North Dakota (Bakken), Texas (Eagle Ford), Louisiana (TMS)

Slide 7:
  • CAPEX: a 35% decrease in 2014 vs 2013
  • Focus: Bakken (49%), Eagle Ford (40%), TMS (10%)
  • 90% of Bakken drilling/completion allocated to FBIR
  • 100% D&C allocated to "sweet spots"
Slide 9: TMS
  • for all the talk, only 10% of CAPEX on TMS in 2014
  • 307,000 net acres vs 142,000 net acres in the Bakken
Slide 12: TMS porosity and TOC
  • TOC: 3 - 4% vs as much as 11% in the Bakken
Slide 14 (very small print, very important), re: proppant (TMS)
  • Samson Oil & Gas says 1,000 lbs/linear foot is the industry standard in the Bakken
  • HK: average -- 1,747 lbs/linear foot in TMS
Slide 15: spud to release
  • 48 days
  • NDIC says ND average is 120 days
  • look to save $2.4 million/well on multi-well pad development (that is as much as three times what other operators say they are saving in the Bakken)
Slide 25: Bakken
  • EURs revised higher -- now up to 
  • slickwater FBIR wells
  • potential for up to 16 wells per DSU in FBIR area
Slide 26: successful TF downspacing test
  • Capitol Pad development plan; McKenzie County; HK with 71% working interest
  • middle Bakken (8), TF1 (4), TF2 (4) [nothing in TF3 or TF4]
Slide 28: 100% of wells will be on multi-well pads; saves $1.3 million & 25 days
  • saves $1.3 million
  • 50% of wells will be on 6-well pads; 42% on 3- and 4-well pads
Slide 28: setting drilling records
  • fastest 10,000 lateral ever drilled in FBIR (4.15 days)
  • fastest 10,000 lateral ever drilled in Williams County (3.5 days)
Slide 29: EURs with slickwater -- at 180 days, 150,000 bbls
  • rule of thumb: 150,000 bbls pays for the well; if so, wells are paid for in six months
  • same payback as EOG
Glabal Warming Could Set New Records

Being reported by AccuWeather. Some of these records go back to the 1950s.

Record Lows to be Challenged Wednesday Morning


Record Low F/Year Set
Beckley, W.Va.
London, Ky.
Macon, Ga.
Nashville, Tenn.
Birmingham, Ala.
Charlotte, N.C.
Raleigh, N.C.
Harrisburg, Pa.
Columbia, S.C.

Another Great COP (BR) Archer Well

Link here and scroll down to #26006.

More on the Archer wells here.

For some companies, when it rains, it pours. Congratulations to the roughnecks on some great wells.

G-7 Theme Song

I understand this is the theme song for the G-7 meeting in Brussels this week. 

I Need A Hero, Bonnie Tyler

For Investors Only -- Phoenix Continues To Benefit


Later, 1:03 p.m. CT: both SLB and HP traded at new 52-week highs today. 

Later, 9:53 a.m. CT: consumer confidence hits 6-year high

Later, 9:02 a.m. CT: the economic tea leaves -- based on CNBC, WSJ, Yahoo!Finance, NPR stories today these actions would do awesome things for the US economy:
  • forgive all student debt
  • open the borders to all undocumented workers
  • increase the earned income tax credit
  • extend unemployment benefits out to four years to correspond to the presidential election cycle
  • increase the minimum wage to $15/hour (one exception: to $20/hour for McDonald's workers and Wal-Mart greeters)
Later, 8:34 a.m. CT: Market opening surges; up 123 points. Investors must be happy that Obama is out of the country, or perhaps it has something to do with home prices dropping for third straight month. It sort of puts tapering on the back burner --- unless Ms Yellin wants to push US into another recession.

SLB trading at a new 52-week high.  BRK-B close to a new high.
Original Post

Tapering? US house prices dip for third straight month. 

Oil futures up half a percent in pre-market trading.

Dow futures up 76 points. Got equity? Why? I have no idea. Maybe it's because the G-7 is going to "shun" Russia. The G-7 will save a lot of money not importing Russian natural gas. Fortunately the EU has all that wind energy to fill the gap.

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read at this site or anything you might think you may have possibly read at this site a long time ago. Or even yesterday.

What better music than a fugue to accompany the indefinite closure of the Houston ship channel and NO Canadian sands oil to fall back on? Thank goodness for Keystone 2.0 South bringing a gazillion bbls of oil from Cushing. Funny how things work out.

Toccata and Fugue in D Minor, Bach

AAPL continues to move up. Investors like the CMCSA tie-in but regulators will never allow it. Apple hires former Senate staffer to get this through. Still won't happen.

In June, 2008, SLB was trading for $107; in February, 2009, one could buy SLB for $34. SLB could hit $100 before this year is over. And paying a dividend all these years, I believe. Back in the late '80s, the dividend was around 7 cents; now around 40 cents.

US Airways - American Airlines good for US service jobs. AZCentral is reporting:
US Airways is hiring 150 customer service agents at its Phoenix call center as part of a deal with its union to bring customer service jobs back to the United States from overseas.
Altogether, the Tempe airline will be hiring 400 customer service agents in Phoenix, Reno, Nev., and Winston-Salem, N.C. under contract agreements with the Airline Customer Service Employee Association , CWA and IBT.
The jobs will be moving from a Philippines call center in Manila under an agreement by the airline to handle all service calls originating in the United States from U.S. call centers.

Oil At $100 -- Futures; Houston Ship Channel Closed Indefinitely, More Than 60 Ships Waiting To Off-Load

Active Rigs:

Active Rigs197186206170105

RBN Energy: ethane exports to Europe.
The large and growing surplus of U.S. ethane is leading producers and shippers to step up efforts to export ethane to Europe and eventually to Asia. But there are several hurdles, including the need to construct specialized dock and loading facilities, special ships required to move ethane in overseas trade, unloading and storage facilities at the receiving end, and the need for ethylene crackers in the global market —most of which now use naphtha as their feedstock—to make costly modifications before they can switch to ethane. It may be costly, but it could happen.  There are those that hang on to the belief (a mistaken one, we think) that the ethane surplus will disappear later this decade as planned U.S. crackers come online and use increasing amounts of ethane.   It is true that those plants will use a lot of ethane.  But not nearly enough. Today in the first episode of this blog series we begin to explore the ethane-export issue.
Billings Gazette

Got coal? The Gazette is reporting:
A coal impact fund already on the books could be tapped to help Montana cities deal with an anticipated increase in the number of coal trains bound for the Pacific Northwest.
Montana Senate Majority Leader Jeff Essmann, R-Billings, told The Gazette he would like to see the state’s coal impact fund used on projects like railroad crossings in Montana cities affected by coal trains. Rail traffic is expected to increase in coming years as coal from the Powder River Basin in Montana and Wyoming is shipped to the Pacific Northwest for export to China.
Coal trains are more than a mile long and, as Billings drivers know, can take several minutes to clear downtown crossings. It’s exactly the kind of problem the coal impact fund was intended to address, Essmann said. But larger cities haven’t fared so well in the past when asking the Montana Coal Board for impact funds. The board, which appropriates impact fund money raised through coal taxes, has favored small communities over the years, Essmann said. Billings applications have been turned down repeatedly.
The Wall Street Journal

Top story: world leaders shun Russia. Well, that will do a lot of good come next winter.

Ukraine battles to boost its military (flashback: Obama negotiated gutting the Ukrainian army as part of guarantee of country's sovereignty; thrown under the bus).

It ends with a whimper: yes, the plane crashed in the ocean.

This is too much: rainbow loom bands. Check the link. This is the fad at my granddaughters' school, and yes, I have a rainbow loom band.

Growing debt burden for graduate students contributing to weak economy. Anything to get our minds off Obamacare.

Houston ship channel closed indefinitely. It will be interesting to watch price of gasoline. Boon to Buffett's railroad? Too bad we don't have the Keystone XL to get Canadian oil all the way to the coast seamlessly in new pipelines.

It will be interesting to see how Ms Sotomayor "votes" on the Hobby Lobby / Obamacare / contraceptive pills case. I don't have a dog in this fight.

Indiana drops common core

Detroit seeks private water partner to run its regional water and sewer system -- plans stall.

Egypt sentences 529 to political activists to death. That was easy. 

Got Ebola? ObamaCare's got you covered. LOL.

Who wants to bet the Afghanistan Army is co-opted by the Russians as soon as the US leaves? This is not rocket science. Russia has the money and the will. The US has neither.

Everyone I've talked to in Starbucks agrees GM needs to be hung out to dry on the ignition-switch cover-up, but because it was the "old" GM -- nothing will happen. There will be a lot of media attention but at the end of the day, Government Motors gets off without even a fine.

Pension plans brace for a one-two punch.

Supreme Court rejects Arch Coal challenge to EPA rules. The Supreme Court does not want to get involved with being the referee for every EPA rule and regulation. They wouldn't get anything else done. This is where Congress needs to step in. This is where the local congressman needs to put in an amendment excluding the company's coal mining project in West Virginia. If Congress won't step in to stop the EPA, then Congress has let us down.

Heard on the street: the market thinks oil is good, natural gas is bad. Don't go with the herd.

The Los Angeles Times

The next test for Obama: soothing the Saudis. LOL.

As required by law, the state of California will sent out voter registration cards to ObamaCare applicants. Something tells me this will go smoothly.

This reporter needs to get a life. He goes to Wal-Mart and notes: "Original Aquaphor was $14.26, while Baby Aquaphor was $14.97. Are these not the same products?" Hello, marketing does this all the time with "new and improved" and then raising the prices on the same product. Hellooooo...don't go to the link. The story was worthless.

The Dickinson Press

Nothing shows up but the ads. I'm sure that will be fixed in another hour or so. But that's pretty clever marketing also: just the ads.

The Minneapolis Star Tribune

No mention of global warming. One winter does not make a climate, but there has been no warming for 18 years now. The lakes are staying frozen longer than usual in the land of 1,000 lakes, and the fish are dying off like never before. No mention of global warming.