A Pre-Release Of The Director's Cut For February, 2014, Oil Production

The next Director's Cut is not expected to be released until early next week, on/about April 15, 2014.

Apparently, the director was excited to release some of the data early. I can see why.

February production surged: preliminary figures suggest February's crude oil production jumped 16,000 bopd to 951,340 bopd, compared to January, 2014, production of 935,126 bopd. This still doesn't match/exceed the all-time record set back in November (2013), but it was a nice jump considering February is the middle of winter in North Dakota.

(951,340 - 935,126)/935,126 = a 1.7% increase month-over-month in the middle of winter. Not bad.) By the way, what was the month-over-month increase last February (2013)? Five percent (5%).

A two percent increase each month for the next three months easily puts North Dakota production over one million bopd before the summer solstice.

It is highly unusual not to see at least a 2% increase in oil production month-over-month once the weather improves.

The story is being reported by The Bismarck Tribune. 

I track production at the Director's Cuts here.

New Link In The Sidebar At Right: Jobs In The Bakken

A reader asked me if I would post a link to his website. Dakota Oil Jobs. Done.

It's also linked at the sidebar at the right. There are now two such listings. I have not met the "owner" of either website. I have no relationship with either, nor any hidden agenda. It's simply an opportunity for folks who might stumble across this blog looking for work in the Bakken.

The person who put this website together, Dakota Oil Jobs, is a long-time resident of Minot, North Dakota.

If you are from outside the area, and plan on coming to North Dakota, have your act together before you get here: mostly a place to live for six months; and lots of cash to pay for expenses. If you come in any month other than August, bring layered clothing. In August, bring DEET.

Water And Fracking In North Dakota -- Way More Than Necessary; One Day's Release Of Water From Lake Sakakawea Is Enough To Frack All Bakken Wells Drilled This Year

Links

Missouri River gage level, Williston: link here. 

Updates

July 6, 2015: data points from The Dickinson Press with regard to present water requirements for fracking in the Bakken:

• water from water depot sales for fracking peaked in 2014 at 30,000 acre-feet (rounded)
• trend in 2015, dropping back to 2013 levels of 20,000 acre-feet sold (rounded)
• one acre-foot = 325,851 gallons
• Fargo: about 12 million gallons / day
• water for oil and gas drilling amounts to about 10% of all industrial water use in the state

Again, for newbies: water is not an issue for fracking in North Dakota.
 

Original Post

From a post dated May 25, 2013:

So, how much water is being released from the Garrison Dam today? Dynamic link here.

The answer: 20,000 cubic feet/second. [2018: summer release, 30,000 cubic feet/second; winter release, 20,000 cubic feet/second; link here]

A cubic foot of water: 7 gallons.

So, in one second: 140,000 gallons of water released from the Garrison Dam today
In one minute: 8 million gallons of water released from the Garrison Dam today
In one hour: 500 million gallons of water released from the Garrison Dam today

Less then 4 million gallons of water are used to frack a well, but let's keep it simple:
500 million gallons / 5 million gallons = 100 wells

If I did the arithmetic correctly, enough water is released from the Garrison Dam each hour to frack 100 wells.

2,000 wells will be fracked this year. Less than a day's worth of discharge from the Garrison Dam should be enough water to frack all the wells that will be fracked in the North Dakota Bakken this year.

I apologize ahead of time if my calculations are incorrect; I will correct them if necessary.

Today, April 11, 2014, The Bismarck Tribune updates the status of the spring run-off:

The corps’ April 1 runoff forecast was for 32 million acre-feet of water to enter the system through July.

He said average runoff is about 26 million acre-feet. An acre-foot of water is roughly the size of a football field covered with a foot of water.

The planned releases, and modeling:

Jody Farhat, water management chief for the corps, said plans are to step up releases through Garrison Dam from the current 18,000 cubic feet per second to 24,000 cfs by April 15 and 25,000 cfs by the end of the month.

Farhat said May average releases should be around 27,000 cfs and 30,000 cfs for June.
She said that would mean a 2-3 foot increase in the level of the Missouri River through Bismarck and Mandan.

Wade Bachmeier of the Morton Count Water Resource Board, said increased releases should begin sooner to avoid any concerns. “Why wouldn’t we exercise some prudence?” he asked.

Farhat said based on the corps’ models, Lake Sakakawea will rise to an elevation of 1,839 feet under its lower model, 1,847.9 feet under its basic model and to 1,852 feet under its upper model.

Sakakawea is now at an elevation of about 1,836 feet.

Back to the calculations.

A cubic foot = 7 gallons.

30,000 cubic feet / second = 210,000 gallons/second to be released.

 500 million gallons of water will frack 100 wells.

 2,000 wells would require 20 x 500 = 10,000 million gallons of water.

10,000 million gallons / 200,000 gallons (per second) = 50,000 seconds.

50,000 seconds = 833 minutes = 14 hours.

Less than a day's worth of water released from the lake is enough to frack 2,000 Bakken wells.

Crude Oil And Natural Gas Production Both Decreased On Federal Land 2008 - 2012; US Oil Reserves Highest Since The 1970s

I haven't read the full government report yet but it was sent by a trusted reader who probably read every page. Twice. He noted that oil and natural gas production had actually decreased on Federal land from 2008 to 2012.

The energy revolution in the United States is occurring despite every Obama attempt to stop it; he has put up obstacle after obstacle. He dithers on the Keystone for six years, and the Jones Act for just as long. After firing Sebelius, does anyone really think the Keystone is on his mind? The Jones Act?

The entire energy revolution in the United States is due to entrepreneurs drilling on state and private land. Not federal land. The link will take  you to a PDF (http://energycommerce.house.gov/sites/republicans.energycommerce.house.gov/files/20130228CRSreport.pdf).

Right, wrong, or indifferent, this is a pretty damning report for someone who says he a) is a patriotic American; and, b) supports all forms of energy production. I can't comment on the first assertion, but it is clear he does not support all forms of energy production. We know he has a war on coal. And it certainly appears he has a war on crude oil and natural gas coming off federal land. (Not that I want the president to visit Parshall, North Dakota, but Mr Obama has spent more time in Saudi Arabia than Fort Berthold.)

According to a Reuters columnist, US oil reserves are the highest since the 1970s.  Rigzone is reporting:

U.S. exploration and production companies are finding accumulations of crude and condensates twice as fast as they are producing them, according to statistics published on Thursday. Proved reserves of crude stood at 30.5 billion barrels at the start of 2013.

If condensates are included, proved reserves reached 33.4 billion barrels, the highest since 1976, according to a new report from the U.S. Energy Information Administration ("U.S. crude oil and natural gas reserves proved reserves" April 10).

Proved reserves are those which owners believe with reasonable certainty can be extracted at prevailing prices using existing technology - where reasonable certainty means a probability of at least 90 percent. 

I am surprised that the pilot of the first helicopter that went in on the Bin Laden mission is not taking credit for the energy revolution going on in the US. (Oh, that's right: he would lose his most important base -- the activist environmentalists.)

I am amazed that this energy revolution is taking place despite an administration's effort to stop the fossil fuel industry every opportunity presented.

The report and the graph are linked here. 

Huge Population Growth In Shale Boomtowns; The President Pays About The Same Tax Rate As I Do: 20%; It Appears The New GM CEO Has A Skeleton (Key) In Her Closet

FuelFix is reporting huge population growth in shale oil boom cities (this was predicted years on the blog; long-time readers might remember).

The oil and gas boom brought about by new drilling technology is drawing people to shale plays like iron filings to magnets.

New census data show a population surge as the oil boom draws workers and families to oil fields around the country. Some of the nation’s fastest-growing communities include Midland and Odessa in the Permian Basin and three cities near North Dakota’s Bakken Shale field: Williston, Dickinson and Minot. The rapid increase in drilling in the Eagle Ford Shale has spilled into San Antonio.

I love the comment at the link: "It's not going to last." Of course not. Of course the Bakken boom is not going to last.

The Permian lasted about 50 years. Oh, that's right, the Permian has just received another 50-year lease on life. LOL.

I don't understand the concern. It will take until 2040 to drill out the Bakken and then the Bakken will produce into 2100; and, we haven't even mentioned the additional formations in addition to the middle Bakken and the Upper Three Forks.

There are jobs for at least three generations of roughnecks.

If the most recent study is correct, that it might take 120,000 wells to drill the Bakken, at 2,000 wells/year, "we're" going to be drilling for 60 years. That's over three generations of roughnecks.

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I haven't looked at the president's most recent federal tax filing, but I suspect his income is slightly higher than mine. At 20%, his tax rate may be slightly lower than mine. Certainly on the margins.

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Here we go again: GM's new CEO has a skeleton key in her closet. CNBC is reporting:

Exactly why the ignition switch problem went unresolved for as much as a decade has spurred a series of investigations by the Department of Justice, the National Highway Traffic Safety Administration and both houses of Congress. During two Capitol Hill hearings last week, GM CEO Mary Barra was repeatedly criticized for failing to offer clear answers about the ignition switch problem.

One of the documents released Friday showed that while in her previous job as GM's global product development chief, Barra was kept clearly in the loop about a separate recall issue involving steering problems on the Saturn Ion and other GM products.

Some initial news coverage of the newly released documents suggested that this might be a direct link between the GM CEO and the ignition switch problem. But a senior staff member of the House Energy Committee stressed that was not the case, telling TheDetroitBureau.com, such a connection was "premature."

Something tells me some e-mail correspondence will never be found.  There is talk at Starbucks the new GM CEO was set up to fail. I would assume those folks who bet on the "Final Four" are now taking / making bets on how long the new GM CEO will be the new GM CEO. I give her less than two years if the e-mail correspondence reveals a smoking gun.

Disclaimer: this is not a betting site. Do not place any bets based on what you read here or think you may have read here. If you want to bet, go to Atlantic City or Las Vegas. 

As Many As 120,000 Wells Might Be Needed In The Bakken; North Dakota Garners Another First Place Ranking: This Time For Rating Of Public School System

Regular readers are already aware of this story. The Dickinson Press is reporting:

Conservative estimates show it will require 40,000 wells and 20 years to complete drilling activities in the Bakken and Three Forks formations. Some projections put the total well count in the North Dakota Williston Basin as high as 120,000, the study says. North Dakota had 10,100 producing wells in January, including 6,935 Bakken and Three Forks wells.

Hushka said companies are expected to complete an average of 2,100 to 2,300 wells per year over the next five years in North Dakota. The main reason they won’t drill more wells is a limit on how much money they have to spend, he said.

The study is still on-going. Once completed and published, I will link at the sidebar.

If it really did take 120,000 wells, at 2,000 wells/year = 60 years of drilling. Yup, the boom will eventually end. LOL.

By the way, regular readers know that I was the first non-industry blog author from North Dakota who predicted at least 48,000 wells based on simple arithmetic. That was some time ago. 

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A slew of interesting polls putting North Dakota in a good light have been released over the past few days.

Here's another one.

The Dickinson Press is reporting:

Nearly nine out of 10 North Dakotans rate the state’s public kindergarten through 12th-grade education system as excellent or good – the highest rating in the nation.

Eighty-seven percent of North Dakotans gave the quality of K-12 education in the state positive marks in a Gallup poll released Wednesday.

The public school systems in Iowa (83 percent), Minnesota (81 percent) and South Dakota and Nebraska (80 percent) trailed North Dakota closely in the poll.

I was surprised to see North Dakota beat out Iowa -- by a healthy margin. It's always been my worldview that Iowans thought they had the best public school system. I know Iowa has seemed to falter over the past three election cycles. Any correlation?

The Long Reach Of The Bakken -- All The Way To Denmark; Long Creek Oil Field; Antarctic Ice At Record Levels And Growing; So Much For All That Talk About "Extreme Weather" -- Quieter Hurrican Season Predicted, The Atlantic Ocean Has Cooled Appreciably

Some time ago a reader told me that when "Wall Street" discovered the Bakken, things would take off. Buckle your seat belts. A reader (and mineral rights owner) from Denmark sent me this:

Zavanna has just spud 4 out of 6 wells going south in Long Creek, sections 3/10. Our family in Denmark and Sweden has mineral rights in both sections (and, also section 15).

and this from a Blackstone press release:

River Bend (Blackstone) is participating as a non-operating working interest partner in Zavanna’s development program, including a 3 rig program and over $200 million gross operated capital budget for 2014.

Blackstone, based in New York City, is the largest alternative investment firm in the world, is obviously heavily invested in the Bakken.

This, of course, naturally begs the question: whose deep pockets on Wall Street is backing Slawson? Is Blackstone involved with other operators in addition to Zavanna?

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.

Long Creek Oil Field

Long Creek oil field is smack dab in the middle of the Bakken and sits between two sweet spots: the Stockyard Creek in Williams County to the north and immediately west of the incredible Truax and Banks fields in McKenzie County to the east. Long Creek oil field is about 18 sections; just south of Stockyard Creek east of Williston.

Permits

2016
None, so far (as of July 16, 2016)

2015 (list is complete)
30900, 640, CLR, Reckitt Federal 1-22H, 25 stages, 2.9 million lbs, spud May 8, 2015; TD May 23, 2015, t9/15; cum 104K 5/16;

2014 (list is complete)
28594, 1,676, Zavanna, Simmental 2-11 4TFH, 50 stages, 5.8 million lbs, t5/15; cum 192K 5/16;
28593, 564, Zavanna, Simmental 2-11 3H, 50 stages, 5.6 million lbs, t5/15; cum 163K 5/16;
28592, 2,024, Zavanna, Simmental 2-11 2TFH, t5/15; cum 186K 5/16;
28591, 726, Zavanna, Simmental 2-11 1H, t6/15; cum 200K 5/16;
28886, 2,342, Zavanna, Gust 2-11 2H, t5/15; cum 32K 5/16;
28885, 1,360, Zavanna, Gust 2-11 3TFH, t4/16; cum 21K with two months of production;

2013 (list is complete)
26771, 1,060, CLR, Winston 7-12H, t7/14; cum 229K 5/16;
26770, 717, CLR, Winston 6-12H1, t7/14; cum 187K 5/16; 
26687, 1,210, Zavanna, Angus 3-10 7H, t4/15; cum 181K 5/16; 
26685, 1,543, Zavanna, Angus 3-10 5H, t3/15; cum 101K 5/16;
26684, 567, Zavanna, Angus 3-10 3TFH, t9/15; cum 154K 5/16;
26682, 2,770, Zavanna, Angus 3-10 1H, t9/15; cum 164K 5/16;
26677, 695, Zavanna, Nelson 3-10 2TFH, t12/15 cum 112K 5/16;
26676, 630, Zavanna, Nelson 3-10 3TFH, t12/15; cum 102K 5/16;

2012
23189, 409, CLR, Winston 3-12H, t11/12; cum 161K 5/16;
23188, 457, CLR,Winston 2-12H, t11/12; cum 185K 5/16;

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Global Warming Update

Antarctica sea ice 1,282,000 sq km above normal and climbing.

The graph is here. It's called an anomaly. LOL. An anomaly since 2012?

Rock and Roll All Nite, Kiss Nation

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Another Global Warming Inconvenient Truth

Reuters is reporting: quieter-than-normal hurricane season. Why? Because the Atlantic Ocean has cooled appreciably.

Phil Klotzbach, who heads the CSU team, said the lower forecast was based on cooler waters in the tropical Atlantic and expectations that El Nino, the climate pattern that creates wind shear, making it harder for storms to develop into hurricanes, will form this year.

"The tropical Atlantic has anomalously cooled over the past several months, and the chances of a moderate to strong El Nino event this summer and fall appear to be quite high," he said.

Your "warmist" friends won't read the article, nor will they let you bring it up. The warmists have declared that the discussion is over. The truth is out there. LOL.

Likewise, the ObamaCare discussion is over. Two million enrolled; one million will pay their first month's premium and the tax bill will be called a success. LOL. The number went from 40 million uninsured, to 30 million uninsured, to 9 million enrolled, to 7 million enrolled, to 4 million enrolled, to 2 million enrolled, to 1 million who will actually pay their first month's premium.

Two (2) More CLR Atlanta Wells, Baker Pad, Have Been Reported

I track the Atlanta wells here.

The two new wells reported today have typical CLR initial production (IP) numbers:

• 23359, 343, CLR, Atlanta 14-6H, Baker, t3/14: cum --
• 23360, 522, CLR, Atlanta 13-6H, Baker, t4/14; cum --

It looks like there about five (5) Atlanta wells yet to be completed/tested/reported. Contrary to some other reports, it appears not all the wells have been tested/completed/reported yet. Contrary to earlier reports, these are pretty typical IPs for CLR wells.

It looks like #23372 is coming back on line, after being taken off line while other wells were being completed. 

I don't like the long time from first spud to first sales for this pad, but during this period it appears the "payback" for a Bakken well is now 75,000 total barrels. That is a huge change.

In addition, elsewhere it is being reported by foreign analysts that the break-even point in the Bakken is $60. WTI is now trading solidly above $100.

Ten (10) New Permits -- The Williston Basin, North Dakota, USA; Warmists Can't Have It Both Ways

Active rigs:

	4/11/2014	04/11/2013	04/11/2012	04/11/2011	04/11/2010
Active Rigs	190	187	208	173	105

Ten (10) new permits --

• Operators: QEP (4), WPX (4), Denbury Onshore, Whiting
• Fields: Grail (McKenzie), Van Hook (Mountrail), Cedar Hills (Bowman), Sanish (Mountrail)
• Comments:

Wells that came off the confidential list today were posted earlier; see sidebar at the right.

Three (3) producing wells were completed:

• 23194, 1,864, Statoil, Hospital 31-36 4TFH, Alger, t3/14; no production data,
• 23359, 343, CLR, Atlanta 14-6H, Baker, t3/14: cum --
• 23360, 522, CLR, Atlanta 13-6H, Baker, t4/14; cum --  

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North Dakota Utility Gets Rate Increase As Requested

North Dakota approves increase in MDU rate structure. NoDaks have already been paying it, so they won't notice the increase. LOL. 

Detroit 442, Blondie

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Global Warming

Snowpack in the Montana mountains between Lake Sakakawea and Fort Peck, MT, is 39 percent higher than normal. Of course, the warmists predicted that, also.

According to The Bismarck Tribune, it's going to be cooler than normal spring/summer, and the meteorologists cannot explain it:

“When we’re talking cooler than normal, we’re not talking a degree or two,” he said.....implying that the cooler weather will be several degrees cooler.

The meteorologist notes there is nothing driving the cooler temperatures. Perhaps a decrease in the number of coal-powered utility plants? A presidential executive order?

And yet the warmists can identify the source of "global warming" in which the temperature is forecast to rise a degree or two over one century. We can't figure out why we're having cooler temperatures in the "here and now," but we can identify the source of "climate change" over the next century. Ya gotta love it.

I can't make this stuff up.

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The BLM vs The Rancher In Nevada?

It was a Senator Reid land grab for solar farms.  That was easy. [Later: it appears this was all about Senator Reid -- if so, this is really, really scary. Senator Reid says, "This is not over."]

Two Coal Plants Added To The Nation's Grid Accounted For 50% Of All Solar Added In 2013; Proof That Wind Won't Succeed Without Huge Government Subsidies/Tax Breaks

A picture is worth a thousand words. This graph is priceless:

According to the US government:

Natural gas-fired power plants accounted for just over 50% of new utility-scale generating capacity added in 2013. Solar provided nearly 22%, a jump up from less than 6% in 2012. Coal provided 11% and wind nearly 8%. Almost half of all capacity added in 2013 was located in California. In total, a little over 13,500 megawatts (MW) of new capacity was added in 2013, less than half the capacity added in 2012.

The small print has several story lines. Perhaps the biggest story line:

Two coal plants, both delayed projects that were originally scheduled to be completed in 2011-12, accounted for all of the coal capacity added in 2013. The Sandy Creek Energy Station in Texas is a 937 MW conventional steam coal plant that was badly damaged during testing in 2011 and required major repairs before becoming operational. The Edwardsport plant in Indiana is a 571 MW integrated gasification combined-cycle (IGCC) plant, one of only two of the many proposed IGCC projects that actually advanced into construction as natural gas prices dropped (the Kemper County IGCC project in Mississippi is still under construction).  This story is now tracked here.

Nah, this was bigger:

Wind capacity additions (1,032 MW) dropped sharply in 2013 to less than one-tenth of the capacity added in 2012 (12,885 MW). This was a widely expected result of the rush to complete wind projects in 2012 to qualify for the federal production tax credit.

Nah, this was bigger:

New coal activity in 2013 was onepointfive (1.5) times greater than new wind power -- 150% more.

Ohio Regulators Ban Fracking Due To Earthquake Link; No Jones Act Ships Available; One Page Short Of A Manuscript; One Fry Short Of A Happy Meal -- This About Says It All --

... incredibly pathetic....one almost feels sorry for the wicked witch of the west. Not.

The Weekly Standard is reporting:

Kathleen Sebelius had one final glitch on her way out the door. At her resignation celebration at the White House Rose Garden today, she was missing the final page from her prepared remarks. "Unfortunately, a page is missing," Sebelius said. The crowd laughed.

Sure.

Pretty much explains everything in the administration. One fry short of a happy meal.

Ding, Dong, The Witch Is Dead, The Wizard of Oz

A spokeswoman for Sen. Pat Roberts, a Republican from Sebelius' home state of Kansas, called the resignation "a prudent decision" given what she called the total failure of Obamacare implementation.

It's really too bad about the implementation of ObamaCare. It was such a good law.

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But Back To The Bakken

Oil is overflowing along the gulf. Nowhere to go; can't be exported. And yet WTI surges over $104 for no obvious reason. What gives?

Bloomberg is reporting:

Houston and the rest of the U.S. Gulf Coast have more crude oil than the region can handle.

Stockpiles in the region centered on Houston and stretching to New Mexico in the west and Alabama in the east rose to 202 million barrels in the week ended April 4, the most on record, Energy Information Administration data released yesterday show.

Storage tanks are filling as new pipelines carry light, sweet oil found in shale formations to the coast and U.S. law keeps companies from moving it out. Most crude exports are banned and the 13 ships that can legally move oil between U.S. ports are booked solid. The federal Jones Act restricts domestic seaborne trade to vessels owned, flagged and built in the U.S. and crewed by citizens.

“You can’t get all that light, sweet crude out, it’s all kind of piling up,” said Jeff McGee, the founder of Makai Marine Advisors LLC in Dallas, who previously led research at two shipbrokers and worked as a refinery planner. “You couldn’t find a spot Jones Act ship to save your life right now.” 

Regular readers of the blog know (from RBN Energy) that there is a shortage of Jones Act ships. One of my regular readers was not able to understand the Jones Act issue, though she claimed to have taken a maritime law course "years ago." LOL.

The president, of course, is completely caught unawares of the Jones Act unintended consequences. He continues to show incredible ineptness. Where's the energy secretary? Oh, that's right. He is probably looking for the missing page of Ms Sebelius resignation speech; he may need it yet.

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In Ohio, Fracking Is Moving Tectonic Plates

CNBC is reporting:

State regulators for the first time have linked earthquake activity in eastern Ohio to hydraulic fracturing, confirming the suspicions of activists pushing unsuccessfully for a drilling ban.

State Oil & Gas Chief Rick Simmers told The Associated Press on Friday that the state has halted drilling indefinitely at the site near Youngstown where five minor tremors occurred in March following investigative findings of a probable link to fracking.

A deep-injection well for fracking wastewater was tied to earthquakes in the region in 2012.

Simmers says Ohio will require sensitive seismic monitoring as a condition of all new drilling permits within three miles of a known fault or existing seismic activity of 2.0 or greater. Drilling will pause for evaluation with any tremor of 1.0 magnitude and will be halted if a link is found.

Makes the state of North Dakota look better and better every day.

Disclaimer: this site is not an investment site. Do not make any investment decisions based on anything you read here or anything you think you might have read here. For investment advice google George Soros, Jim Cramer, and Dennis Hartman. 

I assume banning fracking in some areas in Ohio will just about kill small operators in Ohio. Chesapeake, I assume, is in deep, deep do-do.

For Investors Only; Thank Goodness I Never Invested In BioTech -- Their Anthem -- I Hate Myself For Loving You ... Is Biotech The Next Casualty Of ObamaCare?

Updates

April 13, 2014: I am getting caught up with old stories / old e-mail -- my internet and e-mail service was interrupted recently due to issues beyond my control. I don't watch television, and I didn't see a reason why WTI was up to $104. Perhaps this was the reason: OPEC cuts production in March. It's quite a story.  Angola, down 167,000 bopd; Libya, down 100,000 bopd; Saudi Arabia, up 100,000 bopd. If the figures are accurate, it's almost a draw. Saudi fudges numbers, I assume, and the delta may have been even less, month-over-month. It still doesn't explain $104 WTI oil; Brent rose during the same time period. Bloomberg is reporting:

Angolan output dropped by 167,000 barrels a day to 1.52 million, the biggest decline for any member this month, the survey showed. Production tumbled because of maintenance at the Plutonio offshore field operated by BP Plc.

Libyan output dropped by 100,000 barrels a day to 250,000, the 10th decline in 12 months. The North African country’s production has fallen because of political protests and the seizure of ports by rebels. Libya pumped 1.59 million in January 2011 before the uprising that led to former leader Muammar Qaddafi’s ouster and death that year.

Original Post

 

... wow, might this not be the perfect moment for oil and gas investors?

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. If you want investment advice: George Soros, Warren Buffett, Jim Cramer, Dennis Gartman.

But I digress. As I was saying, might this not be the perfect moment for oil and gas investors?

• the market swoons providing an opportunity for buying
• it looks like money is moving from biotech sector to other sectors, perhaps the energy sector
• WTI oil is now above $104

That caught me by surprise. WTI oil now above $104. What gives? The dollar, weakened, is holding.

On a day that the market continues to swoon, COP and CVX are up strong (XOM is down, but not by much and trading near its 52-week high).

And for all those biotech investors:

I Hate Myself For Loving You, Joan Jett & the Blackhearts

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The ObamaCare Trainwreck

First, as a reminder, it was the Democratic senator from a neighboring state who was the biggest proponent of the Affordable Care Act who now calls it a "trainwreck."

The ridiculous goal of 7 million enrollees (remember, there were 30 - 40 million uninsured, according to Barry and Hillary) was scaled back to 6 million enrollees.

It looks like that even the "more believable" figure of 4 million is incorrect. My hunch is that when the 2 million number was given to Barack, that was the last straw: he fired the wicked witch of the west.

2 million.

And based on recent survey out of North Dakota is looks like only 50% of "enrollees" will actually pay their first premium. It will be worse in most other states.

One has to wonder if biotech was caught up in the "trainwreck."

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Now, Back to WTI -- Surging -- Over $104

First of all, the high price of oil is not necessarily good news for investors in oil and gas (that's counter-intuitive; I've discussed it before; not going to go over that again, at least for the time being).

Having said that, if WTI goes over $100, the best time for that to happen is after the North Dakota winter storms, and the spring flooding, so the $104 is coming at just about the right time for Bakken operators.

I don't get it, though, why oil is up almost 1% today, solidly above $104. What are the DrudgeReport headlines? Not one thing to suggest geo-political events -- sure, Putin is about to invade the Ukraine, but that's all about natural gas. The big story over at CNN.com is all about the "black box." The CNN folks certainly are not worried about the impending Ukrainian takeover.

As long as we're in a "Joan Jett" sort of mind, here's another, from 1984:

Do You Wanna Touch Me (Oh, Yeah), Joan Jett

Data Points From The Bakken -- For Newbies -- Sweet Dreams Are Made Of These ...

... who am I to disagree?

After updating the 4Q13 well results (still in progress) and I probably won't finish today, some observations, from corporate presentations, press releases, news reports, Bakken well data:

• when I first started blogging about the Bakken, I said that a Bakken well probably "paid for itself at the wellhead" after 100,000 bbls; then with more expensive wells, I moved that figure to 150,000 bbls; I now think that Bakken wells "pay for themselves at 75,000 bbls" -- partly due to the longest stretch of high oil prices in history; narrowing spread between WTI and Brent; cost of wells coming down
• there are "no" dry wells in the Bakken
• "payback" is hell -- more on this cryptic comment a year from; until then, don't ask, don't tell
• Enerplus Resources is the biggest surprise; some huge wells
• several oil fields to watch: Banks, Truax, Antelope, Mandaree; some of these are the "same old names," but Mandaree is interesting (an Enerplus Resources field)
• Statoil continues to have huge IPs; moderate wells in the long run
• BR has huge IPs; great wells in the long run
• CLR remains an enigma: moderate IPs; moderate wells; but lots of "seed corn" planted
• KOG has highest cost wells, but consistently great wells
• natural fracking is the operator's best friend, but if you don't have natural fracking, max out sand -- 10 million lbs is a nice start
• number of stages may be less important than total amount of sand
• the increase in the number of perforations (I can't imagine that adds much marginal cost)
• the experienced roughnecks are correct: they've never seen anything like the Bakken

Sweet Dreams Are Made Of These, Eurythmics

Odds And Ends; Enerplus Hitting Some Huge Wells

Some things noted while updating old Bakken posts.

Look at this spectacular Enerplus well in Mandaree:

• 22666, 1,538, Enerplus Resources, Pinto 149--93-29A-32H, Mandaree, 39 stages; 9 million lbs sand; very high gas pressure (up to 8,000 units); 20 - 40 foot strong flare; t9/13; cum 115K 2/14;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	2-2014	28	11471	11616	3702	5696	5696	0
BAKKEN	1-2014	31	12888	13037	5307	9293	9293	0
BAKKEN	12-2013	30	15944	15882	6133	11996	11996	0
BAKKEN	11-2013	29	17445	17480	7002	15720	15720	0
BAKKEN	10-2013	29	30639	30490	9940	18383	0	18383
BAKKEN	9-2013	21	25135	24768	25239	15081	0	15081

A spectacular Slawson well in Big Bend, look at minimal amount of frack sand:

• 25050, 891, Slawson, Alamo 3-19-18H, Big Bend, about 28 days to TD, poor gas show initially but did rise to 5,200 units at its highest, 34 stages 1.6 million lbs sand, t6/13; cum 126K 2/14;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	2-2014	14	4365	4472	1729	2152	2082	0
BAKKEN	1-2014	28	9534	9820	3883	7564	7424	0
BAKKEN	12-2013	31	13423	13417	4446	13450	13295	0
BAKKEN	11-2013	30	18590	18458	4827	14174	14024	0
BAKKEN	10-2013	29	13477	13830	4397	9998	9853	0
BAKKEN	9-2013	30	17684	17660	5552	11429	11279	0
BAKKEN	8-2013	31	20446	20286	7920	2652	2497	0
BAKKEN	7-2013	31	19250	19316	9341	384	74	0
BAKKEN	6-2013	10	8855	8073	2990	100	0	0

Another spectacular Enerplus well, this one targeting the Three Forks:

• 22665, 1,352, Enerplus, Mustang 149-93-29A-32H TF, Mandaree, high gas (6,500 units) with a 10 - 20 foot flare), frack data not yet posted; t9/13; cum 115K 2/14;

How about the XTO well with an IP of 0:

• 25383, 0, XTO, Allie 31X-24H, Capa, 27 stages; 3 million lbs; t9/13; cum 37K 2/14;

4Q13 New Wells Reporting Updated; Statoil With A Huge IP -- Almost 5,000 BOPD

I'm in the process of updating wells that were reported in 4Q13. When wells come off the confidential list, a lot of the better wells go directly to "DRL" status. Three to six months later, the well is completed, tested, and reported, so periodically, I need to go back and update previously reported wells.

I just noted this recently completed well:

• 24360, 4,884, Statoil, Knight 35-26 2H, Banks, t12/13; cum 12K 2/14;

A couple points, especially for newbies:

• scroll through the 4Q13 wells -- these are huge wells; and the cost of wells keep coming down
• look at wells in the Banks oil field -- a source in the Bakken told me a couple months ago to keep an eye on the Banks oil field
• look at some of the spectacular HRC wells in Antelope oil field

Meanwhile -- 

Question #9 over at the FAQ page: What is the record IP to date in the Williston Basin? 

Statoil reported an IP of 5,417 on September 26, 2013: #23992, Beaux 18-19 7H, Banks oil field.

Statoil reported an IP of 5,387 on July 19, 2013: #23387, Beaux 18-19 4H, Banks oil field. This might be a new record (this is the IP for crude oil only).

The initial production of any well, self-reported by the producer, is becoming less meaningful over time. Having said that, it looks like the record IP for a Bakken well is now 5,200, a Newfield well (July, 2011): 18691, 5,200, NFX, Wisness Federal 152-96-4-2H, Westberg, Bakken.

Statoil reported on July 10, 2013: 23385, 5,070, Beaux 18-19 6H, Banks, t6/13; cum -- ; 7 days to drill the lateral; I did not see completion data; 31 swell packers planned; 

Two earlier wells: a Whiting well which had an IP of 4,761 boepd: file #17612, 4,761 boepd IP, Whiting, Maki 11-27H, Mountrail County, Sanish field.  This is still current as of February 20, 2010. Since then, BEXP claims to have set a record with the Sorenson 29-32 1-H, #18654, with a 24-hour flowback of 5,133 bopd. However, the NDIC reported an IP of 2,944. BEXP also reported the Jack Cvancara 19-18 #1H (this site is down) in the Ross project area with a 24-hour flowback of 5,035.

New record in the Bakken, November 3, 2011. The Tarpon Federal 21-4H is a Whiting  Petroleum operated well and had a 24-hour initial production (IP) rate of 7,009 barrels of oil equivalent (BOE), setting a new Williston Basin record for a Bakken well.

Whiting said this was a record TFS well at the time, early 2012, file #20526, Smith 34-12TFH, 2,446, 102K in first 4.5 months.

A corollary: what is the best Bakken well? For 2012, click here.

This Just About Sums Up My Internet Experience ...

Updates

Later, 7:15 p.m. Central Time: and, of course, Apple, Inc., was never affected by "Heartbleed." But it sure as hell looks like it affected Yahoo!Mail, and it was reported earlier that Cisco systems were infected. Why does this not surprise me. 

Later, 1:04 p.m. Central Time: the information in the original post is more accurate than I even realized when I wrote it. It appears that I get no e-mail during the day. It is all batched and then re-sent from Yahoo (or the NSA) between midnight and 3:00 a.m.

Moments ago I just received a note from my wife that she sent on April 8 -- that was three days ago. It had the word "questionnaire" in it. I assume the Obama administration has flagged the word "questionnaire" for further evaluation. In this case, the "questionnaire" had to do with our younger granddaughter and a school project. It had nothing to do with ObamaCare. LOL. Of course, this is all tongue-in-cheek. I assume this is simply a Yahoo glitch that will be corrected over time.

This reminds me of a story. Following my original application to join the US Air Force back in 1972 or 1973 or thereabouts, I received a note from the government: "Please provide additional detail regarding your trip to East Germany in 1965" (or whenever it was, 1964, 1965, or 1966, I forget). I did not mention the trip to East Germany on the application. I was in Norway and Germany as an eighth grader with my dad. Like every tourist then, we took a side trip through Checkpoint Charlie. But the government knew I had been there.
 

Original Post

My Yahoo!Mail account is pathetic. Suffice it to say Yahoo!Mail is too unreliable for my needs.

For the most part Time Warner Cable - wi-fi does not work at our apartment which is why I seldom blog from there. 

I rode into South Lake this morning -- five miles on bicycle -- to an alternate Starbucks -- their wi-fi was dead. I enjoyed listening to iTunes music and reading American Caesar, the incredible biography of Douglas McArthur by William Manchester.

This about sums up my internet experience (LOL):

Bulletproof, La Roux

I'll never let you sweep me off my feet,

I won't let you in again.

The messages I tried to send,

My information's just not going in.

I won't let you turn around

And tell me now.

 I'm much too proud

To walk away from something when it's dead.

And, so we are off to find another connection somewhere....

In the meantime, I'm going to listen to a lot of music. On my iTunes collection. No wi-fi connection needed.

EU Agrees -- Renewable Energy Too Expensive -- Exempts German Steel Industry;

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. 

ArgusMedia is reporting:

The European Commission has opened the way for Germany to continue exempting steelmakers from some of the effects of the country’s renewable energy levy. German steelmakers’ association WV Stahl has welcomed the move, but warns that further discussion is needed before the government finalises its planned reforms.

The steel industry — and other energy-intensive sectors — currently qualify for exemptions from parts of Germany's renewable energy levy. The commission has now agreed to the legality of these exemptions, following concerns over unfair state aid. The German government is in the process of reforming its renewable energy act (EEG) and, in tandem with the commission’s decision, has drafted proposals that existing embedded industrial power generation — a particular concern for the energy-intensive steel sector — will remain levy-free.

WV Stahl said the commission’s decision will help ensure that competitive steel production “remains possible” in Germany. But other aspects of the EEG continue to burden the sector with high energy costs, relative to competitor nations. And WV Stahl urged more dialogue before Germany finalises its EEG reforms, particularly on the exemption status of new-build embedded power generation capacity.

Friday -- April 11, 2014; World's Largest Truck Wash In The Bakken (South Of Williston); Wicked Witch Of The West Resigns

Active rigs:

	4/11/2014	04/11/2013	04/11/2012	04/11/2011	04/11/2010
Active Rigs	190	187	208	173	105

RBN Energy: The road to New England. A continuation on the natural gas constraints in New England. There is NO natural gas storage in New England. Talk about NIMBYs.

There are more and more stories suggesting that the Bakken experience won't be replicated outside of North America. Now another story today: the Financial Post is reporting that Statoil is disappointed with shale outside of the United States. The second story line is how much money Statoil has spent in exploration only to come up empty.

In a push to find new shale basins globally as it expands outside its traditional base, the energy major has invested in shale acreage in Russia with Rosneft, in Germany with Wintershall and in Australia with PetroFrontier Corp .

The company, which has made huge conventional discoveries off Brazil and Tanzania and in Canada in the past few years, is also scouring regions from Argentina to China for more shale opportunities as U.S. acquisition prices have soared.

Another record smashed in the Bakken. This is an incredible story. The world's largest truck wash is located south of Williston, in Alexander, North Dakota. Bakken.com is reporting:

Old records get smashed just about every day in the oil patch, so it’s no real surprise that it now may be home to the world’s largest truck wash.

At least that’s owner Jeff Schutz’s take on the scale of the Kwik n Kleen at the corner of U.S. Highway 85 and N.D. Highway 68 just outside Alexander.

He’s developed wash stations throughout the Midwest and a fleet of mobile wash units and he’s sure there isn’t a bigger truck wash anywhere on the planet in terms of speed and water capacity. He opened Kwik n Kleen four days ago, good timing since just about every rig out there is sporting a few layers of mud and grime from greasy roads and springtime slush.

If the $6 million wash is one for the Guinness World Records book, like Schutz says his research finds, it stands to reason everything about it is sized off the charts.

Trucks roll through a 200-foot-long wash bay spaced with electronic eyes that start and stop all the wash, chemical and rinse cycles along the full length.

But besides the sheer length and height of the wash, which occupies the highway corner with same dominance an indoor sports arena would, for Schutz, it’s all about the water.

There’s not a drain in the wash and he purposely designed it that way.

It likely is, considering a full semi truck wash requires 30,000 gallons of water at the rate of 450 gallons per minute when both truck wash bays and a car wash bay are running at the same time.

All that water isn’t cheap and nor is there an overwhelming supply off the Western Area Water Supply pipeline, which transports Missouri River water treated at Williston throughout the oil patch.

So the wash is all about recycled water.

An area between the two truck bays has all the pumps, tanks and pipes of a municipal water treatment facility, including a large-scale reverse osmosis plant that provides the streak-free water that’s used in the final rinse.

But most of the space is used to collect used wash water in a settling pond bigger and deeper than a swimming pool where dirt and debris fall to the bottom and the cleanest surface water overflows into a separate pond that’s filtered and reused in the wash cycles.

Schutz says 98 percent of the water used in the wash is recycled and only 2 percent is fresh water used in the rinse cycles.

There's a lot more at the link.

***************************************

The Wall Street Journal

Top story: the stock market sell-off yesterday. It was all about tech, and health services.

Ms Sebelius to resign. Fail.

Insider trading coming from the Obama administration. Market-sensitive information vitally important to health-insurance companies has once again reached Wall Street before the public, and this time it appears to have come from the government itself.

At least nine people killed in a three-vehicle crash involving a bus carrying high-school students on a visit to college. FedEx truck crosses median and slams into bus, head-on collision.

Sebelius exits, but health-care war endures.

GOP budget plan narrowly passes House. I've pretty much given up on the House. Lots of talk; little action. Mr Boehner needs to join Ms Sebelius in retirement.

NATO says Russia is ready to strike. Of course, Obama's BLM has already struck -- moving an army of soldiers on to a Nevada ranch to kill a few cows, capture Ma and Pa Kettle.

Uninterestingly, the WSJ reports that the "west" is divided over whether to do anything about Russia, the Crimean, the Ukraine. It's all about money, of course.

According to a report cited in the WSJ, air safety reaches new highs. The global accident rate for arline flights in 2013 was the lowest on record.  Of course, one cannot count as accidents when pilots commit suicide/homicide by flying their planes into the ocean.

GM's recall costs keep rising.

Heartbleed bug found in Cisco routers, Juniper gear. This probably explains why my Yahoo!Mail service is down. I no longer get e-mail in real-time through Yahoo! Yahoo's outages are incredible.  We're starting out another morning with Yahoo! being down I see.

This is why folks in Tennessee don't want to see their automotive plant unionized. Teamsters union members in Louisville, KY, overwhelmingly rejected a part of a contract iwth United Parcel Sercie, creating more headaches for the company as it looks to end months of labor negotiatins.

Regulators tell banks to plug "Heartbleed" security hole.

Natural-gas prices rise as supplies look lean. 

The future of Dollar Stores is dire: the chain will close outlets; reflects rising competition fromthe likes of Wal-Mart and a falling rural population.

The Los Angeles Times

Crash kills ten (10); high school students on bus involved. Struck by a FedEx truck on I-5 in orthern California. Both drivers are killed; three chaperons are killed. Five students killed. The LA Times: Shortly after 5:30 p.m. Thursday, a FedEx truck crossed the grassy median that separates Interstate 5 here and slammed into the bus packed with students en route to visit Humboldt State University, about 200 miles north of the crash site." It looks like FedEx, like CBR, needs to put two drivers in the front cab to prevent single-point failures.

The South Bay high school superintendent, earning $675,000 last year, is put on leave. I assume "paid leave."

Finally, and long overdue, Rock Hall of Fame welcomes KISS, Nirvana, and Linda Ronstadt, among others.  A must-read story.

Boeing will increase its workforce in Long Beach, Seal Beach.

HHS Sebelius resigns. Good riddance. Should have been top story. Buried at the bottom.

Pennsylvania school stabbing suspect "doesn't fit the mold." There's a mold for these psychopaths?

The Dickinson Press

Killdeer farmers, ranchers upset; want local CENEX to "start over." They say the CENEX caters too much to the oil field.

Sebelius: "I'm responsible for the debacle." Resigns. Truly the wicked witch of the west. (Previously the governor of Kansas. Clearly in over her head from the beginning, like most of Obama's administration.)

Natural-Gas Prices Rise As Supplies Look Lean -- Said To Be "Very Disconcerting"; Analysts Expected 14 BCF Injection, Only 4 BCF

Link at The Wall Street Journal:

Natural-gas prices climbed on Thursday after new data raised some concerns about producers' ability to meet future demand. Gas for May delivery rose 6.9 cents, or 1.5%, to settle at $4.655 a million British thermal units on the New York Mercantile Exchange.

Trading was volatile—after falling early in the day, prices soared as much as 4% following the release of U.S. inventory data.

Last week, more gas flowed into storage than was taken out for the first time this year. Analysts had expected the increase would be 14 billion cubic feet; instead, stockpiles grew by 4 billion cubic feet, the U.S. Energy Information Administration said in its weekly storage report.

"This is very disconcerting. It's a slow start," said Teri Viswanath, natural-gas strategist at BNP Paribas.

"The industry is going to have to work that much harder to ensure" there is enough gas in storage before the start of next winter, she said. The U.S. consumed a record amount of natural gas last winter, as freezing temperatures spurred demand for gas-fired heating.

About half of U.S. households rely on natural gas to heat their homes, according to the EIA.