Tuesday, May 20, 2014

Oil Conference In Bismarck Attracts Private Jets

KXNews is reporting:
Oil executives from all over the country are flying in for the 22nd Annual Williston Basin Petroleum Conference.
The petroleum conference is off to a flying start as Executive Air welcomes around 40 private jets filled with oil tycoons.

"We've invited some of the new aircraft manufacturers in the country to bring new aircraft that are here on display behind me and so we're just excited to have everybody come and see Bismarck," says Vetter.
One oil industry salesman is here to show off this King Air 250. This aircraft is used to fly executives to and from the oil fields.
"The 250 is just a really popular airplane up in the upper midwest with its performance, paved unpaved surfaces, payload, speed and just reliability," says Patrick O'Connell, Regional Sales Director, Beechcraft Corporation.
O'Connell flew his jet in from Idaho Falls and says it's his first time in Bismarck.
He says he's looking forward to networking and seeing what the demand is for this type of aircraft in the region.
More at the link. Maybe a few will fly over to Williston while they are in the area. 

I'm hoping the 25th Annual Williston Basin Oil Conference is held in Williston.

Link To North Dakota Petroleum Council Flaring Task Force: Gas Capture Plan

Link to PDF here: http://www.legis.nd.gov/files/committees/63-2013nma/appendices/15_5071_03000appendixb.pdf?20140520183602

It could take a minute or so to download.

A big "thank you" to Don for the link.

KXNews reports the story:
A University of North Dakota researcher says that about 270 oil wells are responsible for 60 percent of all the natural gas flaring in the state.
Chad Wocken is a senior research manager at UND's Energy and Environmental Research Center.
Wocken says there is no "silver bullet" to cut the amount of natural gas that oil drilling companies are burning and wasting instead of capturing. He says the center is exploring the efficiency of different methods to capture gas in remote sites.

CBR Study: Bakken Crude Oil Tends Not To Explode If Trains Stay On The Track

FueFix is reporting:
Oil industry representatives are pushing back against tougher rules for rail cars carrying crude despite a string of fiery accidents and insisting that oil shipped by train from the Northern Plains is no more dangerous than some other cargoes.
An industry-funded report released Tuesday said the volatility of Bakken oil from North Dakota and Montana is comparable to other light crudes.
But the report offers further evidence that Bakken crude is more volatile than heavier oils such as from Canada’s tar sands, following similar studies by Canadian regulators and refiners. The results show Bakken oil is similar to light crudes produced elsewhere in the United States, with characteristics that fall well within the margin of safety for the current tank car fleet, industry representatives said.
Kari Cutting, vice president of the North Dakota Petroleum Council, said it proves federal rules “are sufficient.”
A former senior federal railway safety official disagreed and said recent accidents are enough to justify government intervention.
“We already have examples of this particular crude going ‘boom,’” said Grady Cothen, former deputy associate administrator for safety at the Federal Railroad Administration. “That’s how it has to be treated from a regulatory standpoint despite the distinctions being made” by oil companies.
Oil trains in the U.S. and Canada were involved in at least eight major accidents during the last year, including an explosion in Lac-Megantic, Quebec that killed 47. Other trains carrying Bakken crude have since derailed and caught fire in Alabama, North Dakota, New Brunswick and Virginia.
Regulators in response have discouraged shippers from using older tank cars known to rupture during accidents.
Eight major accidents? Please. Only three involving Bakken crude oil: 1) because the engineer did not set the brakes properly (Canada); 2) washed out railbed due to heavy rains (Virginia); 3) derailment (when crude oil train hit a train that had just derailed). 

I also track these stories at this link.

Futures Don't Mean Squat....I Suppose ...

.. but I'm really impressed with the "staying" power of the price of oil. Right now, futures after hours (a dynamic link; will likely be different over time), show WTI up another 0.59% or about 14 cents, again remaining solidly above $102/bbl as we get closer to peak driving season.

*****************************
A Note to the Granddaughters

We keep a huge dry erase board in the living room of the apartment to work on projects, do math, study the periodic table, draw pictures, doodle, whatever.

The other night I walked into the house and this is what I saw on the board:


The handwriting was that of our 10-year-old granddaughter. She reads a lot about global warming. I assume she was listing the causes of global warming. LOL. I never asked her about this. We talk about a lot of things, but I'm sure she already has her world view on global warming and I don't want to influence her in some areas. She needs to come to her own conclusions based on her own reading and thinking. She'll do fine.

The Number Of Active Rigs Continues To Decrease In North Dakota

Wells coming off the confidential list Wednesday:
  • 25599, DRY, KOG, P Scanlan 153-98-16-9-11-16H, Truax, no production data,
  • 25780, 456, Fidelity, CGB 30-31H, Stanley, t12/13; cum 8K 3/14;
  • 25781, A, Fidelity, Garfield 30-31H, Stanley, Three Forks, 60 stages; 3.9 million lbs; no test date, no IP, producing,
  • 25942, conf, Whiting, Johnson 34-33-2H, Pleasant Hill, a nice well,
  • 26445, drl, CLR, Vachal 4-27H, Alkali Creek,
  • 26570, 258, KOG, Wildrose 159-98-15-10-3-3H3, Big Stone, t2/14; cum 3K 3/14;
  • 26915, drl, Samson Resources, Bel Air 2314-8H, Ambrose, no production yet,
NOTE on KOG's DRY well, from the well file, a sundry form: "[We] did not get a good cement job on surface and we are not able to circulate below the Fox Hills water table. Moving forward we plan to pump 160' of cement covering the interval 1740' - 1900' to cover perfs (1899').

NOTE on Fidelity's Garfield well, from the well file: 60 stages; 3.9 million lbs; no test date or IP as of date of original post.

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

Active rigs:


5/20/201405/20/201305/20/201205/20/201105/20/2010
Active Rigs188189209178112

Eight (8) new permits --
  • Operators: MRO (4), Triangle Petroleum (2), OXY USA (2)
    Fields: Chimney Butte (Dunn), Elk (McKenzie), Murphy Creek (Dunn)
    Comments:
Wells coming off the confidential list were posted earlier; see sidebar at the right.

EURs. Again. There's An Important Question That Needs To Be Asked -- See If You Can Guess The Question

Updates

Later, 6:00 p.m. central time: a reader over at the Discussion Group provided the following (I'm just getting ready to take older granddaughter to swimming, so I will look at the links later). Having said that, these links are to Petroleum News which always has great information:
EOG - Downspacing expands return:

http://www.petroleumnewsbakken.com/pntruncate/261636488.shtml

Continental - Bakken-bullish:

Despite exploration results to the upside, since 2010 Continental has not revised its recoverable oil estimates for the Bakken - currently 24 billion boe.

“We’re confident that the total now is larger,” Henry told Petroleum News Bakken in a Feb. 21 e-mail. “But we don’t have a formal estimate of it yet.”

http://www.petroleumnewsbakken.com/pntruncate/621048712.shtml
Original Post

Motley Fool is asking whether the Bakken is still being undervalued:
Back in 2011, Continental Resources founder and CEO Harold Hamm made waves when he said the Bakken shale formation in North Dakota and Montana held up to 24 billion barrels of recoverable oil. This seemed completely outlandish considering that the U.S. Geological Survey had estimated total recoverable oil in the region to be about 4.3 billion barrels. Since that time, though, the results from this region have just been better and better, and it makes the investment thesis for Bakken players such as Continental, Kodiak Oil & Gas, and Enerplus all the stronger. Let's look at some astounding numbers coming out of this oil patch that are making Hamm's claims less outrageous by the day.

In the Bakken, the average well is expected to generate an EUR in the range of 400,000 to 900,000 barrels depending on where in the formation drilling occurs. Through optimization programs and testing, the EUR for wells has been improving dramatically recently. At some of Continental's recent test wells, EUR has exceeded its typical 600,000 EUR projection by as much as 50% through tighter spacing between wells and increased use of sand in the hydraulic fracturing fluid.

Such results aren't unique to Continental. Kodiak has noted that several of its most recent wells have outperformed its 900,000 EUR projection curves at its wells in Dunn County, N.D., and Enerplus' most recent wells in the Fort Berthold region have seen early production nearly double its own 800,000 projection curves
Hmmmm....I just "showcased" an Enerplus well earlier today -- well before I saw this article. How coincidental.

I have a poor wi-fi connection now, so I can't write as much as I would like. If I remember, I will come back to this post, but I wanted to get the article posted.

For newbies: there is data that suggests the Bakken is a trillion-barrel reservoir (previously posted) and at a measly 3% recovery rate, that yields 300 billion barrels.

But getting back to the subject line, there was a line in the Motley Fool article that should raise eyebrows. I'll come back to it later. Hint: I thought it was also mentioned in the EOG conference call in which EOG seemed to come to the opposite conclusion than Motley Fool did.

The conclusion to this little exercise will be found at this post

***********************************
Meanwhile, for investors ...

  • Anadarko Petroleum is looking too pricey after a 25% YTD gain for Barclays analyst Thomas Driscoll, who downgrades shares to Equal Weight from Overweight.
  • It is easy to understand the enthusiasm for APC considering the strong record of deepwater exploration success, the willingness to monetize assets and the large discovery in Mozambique, Driscoll says; yet Continental Resources, EOG Resources and Noble Energy all are likely to grow twice as fast as APC while lacking any appreciable premium in their shares.
  • The analyst prefers Devon Energy, which he says has made decisive steps to upgrade its portfolio in recent months, significantly improving its near-term investment opportunity set.
Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or think you may have read here.

Even On A "Down" Day For The Market, Some Companies Shine -- For Investors Only

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

Trading at new 52-week highs: EW, NFX, TRGP, UNP, WMB. I invest in a couple of those but not many of them.

Wal-Mart Quickly Closing The Gap To Become World's Largest On-Line Retailer

Staples shares plummet -- down almost 13%.
Shares of Staples are getting reamed this morning after the struggling office supply retailer announced first quarter earnings fell short of analyst estimates and cautioned for the current period. For the quarter ending May 3 Staples said it earned $0.18 on $5.65 billion in revenue. Wall Street had been looking for $0.21 on $5.61 billion in revenue. Same store sales declined 4%.
Staples says it expects to earn somewhere between $0.09 - $0.14 in the current quarter compared to a $0.15 average estimate.
Guiding lower is becoming a quarterly event for Staples. In March the company announced plans to close 225 of its U.S. stores. As of this morning Staples says 80 of those locations will be shuttered by the end of the current quarter. About the only positive during the period was 6% growth at Staples.com. Staples is still the second largest on-line retailer in the world though Walmart is quickly closing the gap.
I track the demise of the Big Box stores here

The big story here, however, is not that another big box store is in trouble. The big story is that Wal-Mart, which stereotypically does not cater to internet-savvy consumers, is quickly closing the gap to become the world's largest on-line retailer. I have trouble believing that but that's what it says, and if it's on the internet, it must be true.

********************************
... and the end is near for Surface, too ...

From Yahoo!In-Play:
Microsoft announces Surface Pro 3; starting estimated retail price of $799: Co introduced Surface Pro 3. "Surface Pro 3 is a tablet and a laptop: multiple processor, RAM and storage options intersect with a sleek design that, with a simple snap or click, transform the device from a perfectly balanced tablet to a full-functioning laptop and back again - all in a beautiful package that is 30 percent thinner than an 11-inch MacBook Air. Its stunning 12-inch display and new, continuous kickstand provide the screen real estate and multiple viewing angles people need for work and play. And the new Surface Pen - completely redesigned with form and function in mind - delivers a precise, luxurious drawing and note-taking experience with a single click of the pen."

Starting at an estimated retail price of just $799, Surface Pro 3 will be offered in multiple configurations featuring 4th-generation Intel Core i3, i5 and i7 processors. Surface Pro 3, Surface Pro Type Cover and Surface Pen will be available for pre-order2 starting May 21 at 12:01 a.m. EDT through Microsoftstore.com, Microsoft retail stores and select third-party retailers. Commercial customers should speak to their authorized reseller.

Computerworld.com is reporting:
Microsoft has lost more than $1.2 billion so far on its Surface tablet business, an expensive experiment that makes tomorrow's revelations of new hardware an important milestone for the "devices" side of its corporate-refashioning strategy.  
While analysts and observers have split on Surface's future -- some see Tuesday as a last-chance for Microsoft to tweak its tablet strategy, others believe the company will press forward regardless of the reception pundits give the new devices -- it's a no-brainer that eyes will be on Nadella, who will have to explain how he will push, pull and drag the Surface out of its money-losing ways.
For although Microsoft has been parsimonious in the details it declares of the Surface's financial performance, the business has clearly been a money pit. In the last two quarters -- the only ones in which Microsoft has explicitly called out revenue and cost of revenue -- the tablet line lost $84 million.
Reuters:
Microsoft Corp's Surface tablets have yet to make any profit as sputtering sales have been eclipsed by advertising costs and an accounting charge, according to the software company's annual report.
The two tablet models, introduced in October and February to challenge Apple Inc's popular iPad, have so far brought in revenue of $853 million, Microsoft revealed for the first time in its annual report filed with regulators on Tuesday. 
That is less than the $900 million charge Microsoft announced earlier this month to write down the value of unsold Surface RT - the first model - still on its hands. 
On top of that, Microsoft said its sales and marketing expenses increased $1.4 billion, or 10 percent, because of the huge advertising campaigns for Windows 8 and Surface. It also identified Surface as one of the reasons its overall production costs rose. 
The Surface is Microsoft's first foray into making its own computers after years of focusing on software, but its first attempts have not won over consumers. By comparison, Apple sold almost $24 billion worth of iPads over the last three quarters.
 I can't find the article now, but it appears tablets are going to be challenging for all companies: people hold onto their "old" tablets longer; they don't need upgrading or replacing as often as phones or even laptop computers.

Speculation On Terms Of That Russian-Chinese Natural Gas Pipeline Deal

Updates

Later, 5:17 p.m. central time: we got the answer -- or $9.50 to $10 per thousand cubic feet.
 
Original Post
 
For background, see this post on the Russian-Chinese natural gas pipeline deal-in-progress

Someone who understands natural gas pricing better than I writes succinctly, if the deal gets done:
  • If price is $9 per mmbtu then China has really played hardball. 
  • If price is $11 per mmbtu then Russia has really won. 
  • If between then they are working together. 
In North Dakota, a reader writes his natural gas bill:
  • $8.18 per mmbtu which includes a basic service charge, and a distribution fee per mcft.
  • the actual cost of gas was $ 6.76 per mcft.
Now, we just have to watch if the deal gets signed, and if the terms are announced. I will have to rely on readers to watch the trade journals. 

[1 mcft = 1 mmbtu]

Montana Update: Whiting Reports Three Bakken Wells; CLR Reports One Bakken Completion

Fairfield SunTimes is reporting:

Richland County (west of McKenzie County in North Dakota), all Bakken:
  • Whiting, Christiansen 34-11-5H, 15,972 feet and 20,110 feet, IP of 938
  • Whiting, Christiansen 34-11-6H, 20,150 feet, IP of 784
  • Whiting, Berry 24-32-1H, 20,710 feet, IP of 881
  • CLR, Audrey HSL, 20,279 feet, IP of 268
Toole County:
  • Kevin-Sunburst field, Somont Oil Company, State 36 64, EOR; no other data reported
  • State 36 63, reached the Swift Formation, total depth, 1,335 feet; no other data reported
Wibaux County:
  • Petro-Hunt, Miske 11-60 3C-3-1, a Red River well, IP of 194

Switzerland Developer Preparing To Break Ground On Half-Billion-Dollar Residential/Commercial Project In Williston, North Dakota -- Ground Zero For The Bakken

Updates

May 23, 2014: I received this as a comment, but comments are not google-searchable, so moved it here for easier access:
http://www.sys-con.com/node/3091627
This link is a little more detailed than the Bloomberg on Williston Crossing. Note the history of the developers of Williston Crossing. Sounds like they are legit, have the resource funds already in place, intend to break ground March 2015 with completion date of 2017. 
They have a huge history of million of square feet of retail, malls, etc... I think this might actually be for real. 
The location is in question. If it is near the 4 mile west of town, the only available acreage left on 2/85 going into WIlliston (west of town) is the large parcel between the McCody concrete office building and Schlumberger's new facilty (north side of the highway). I'm not sure if there is 228 acres? Possibly. 
Otherwise, the only other land is west of the 4-mile corner on the south side of the highway (US Highway 2), between the 4-mile and Trenton-turn off? Could be interesting. 
Unless they are talking about the new interchange and bypass NORTH of Williston where Pat Murphy is planning his North Star Center (550 acre development breaking ground in June).
The link is interesting for other reasons.

Some time ago there was a presentation suggesting how many wells might have to be drilled in the Bakken before it's all over. That presentation was removed quickly from the internet suggesting that it came from proprietary source and was not approved for general release. I don't know. "Everyone" agrees that the "new" minimum number of Bakken wells will be 50,000. Many folks now talk about numbers higher than that, but like "whisper numbers" on Wall Street are seldom found in print (for obvious reason). This link, in this update:
Rapid expansion in the petroleum sector has led to unprecedented regional growth. Rolfstad says, the Bakken Shale currently has approximately 8,000 operating wells, and is adding about 2,100 per year. Given the multiple oil formations under the Williston area, and the trend towards situating multiple wells in one location and accessing surrounding territory via horizontal drilling, the latest thinking is that there could be 140,000 more wells to be drilled. He says completion times are indeed getting shorter, but there are decades of drilling ahead of us, and after, each well can produce for upwards of 40 years.  
In addition to that incredible data point, the very next paragraph:
The area's population is also growing at a swift pace -- nearly nine percent per year through 2017 -- and will continue to grow to 159,000 over the next 10 years. According to Rolfstad, "Each oil well leads to between one and three permanent production jobs. Drilling requires manpower, and that workforce is here today. Production requires manpower as well -- in fact a similar number of workers -- with a key difference being that this workforce can settle down in one place for an entire career. That's where we are headed." 
And so it goes. 

By the way, the numbers are starting to converge: a one-trillion-barrel reservoir; 140,000 wells; EURs of 500,000 bbls; 7% recovery rate. It's hard to keep track of the zeros but if you do the math, one comes to some very interesting ... should we say, coincidences?

I've posted this before: when I was last in Williston, I had an "aha" moment. The oil industry in the Bakken seemed to reach a plateau two, maybe three years ago with drilling 2,000 wells/year. The tea leaves suggest "everyone" is happy with 2,000 wells/year; over time, possibly less, but maintaining production between one million and two milllion bopd. My return visits to the Bakken over the past three years suggest that there are enough resources: workers, housing, rigs, pipeline, CBR terminals, etc., to comfortably manage 2,000 new wells/year. But the "aha" moment: the building continues at an incredible rate. Why? More natural gas processing plants need to be built. Permanent workers need to be in place to service the thousands of wells currently producing in North Dakota, and growing by 2,000/year. Yes, at some point, the manpower intensive drilling program will end -- but that might be 20, 30, or 40 years from now. 50,000 wells at 2,000 wells/year = 25 years. Meanwhile, each new well is going to require one to three new permanent workers. This does not include the number of opportunities that open up to "serve" these workers: restaurants, entertainment, shopping, banking, legal, medical, etc. I still think it would serve folks well to look at Calgary, Alberta, Canada, pre- and post-1947.
Original Post

A huge "thank you" to a reader for alerting me to the story.

It's hard to separate fact from fiction, the credible from the incredible, the pie in one's oven from "pie in the sky," but the Bakken never fails to provide exciting copy. If this pans out, this could be the story of the month; as fast as the Bakken seems to be moving, it is certainly the story of the hour, and published in Bloomberg, no less (in case that link breaks, same story in FuelFix): 
A Swiss developer is planning to build a $500 million real estate project in Williston, North Dakota, where a surging energy industry is leading to a population boom and rising property demand.
The two principals of developer Stropiq Inc. are at the International Council of Shopping Centers conference in Las Vegas this week trying to lure retailers to the 219-acre Williston Crossing project, scheduled to break ground in March. The 1 million-square-foot (93,000-square-meter) project will include retail, entertainment, hotel, office and multifamily buildings.
Stropiq and investors such as KKR & Co. are rushing to accommodate a ballooning population of energy workers in Williston, located in the oil-rich Bakken shale formation. The average rent for a small apartment in the western North Dakota town is higher than in New York or San Francisco, according to Apartment Guide. Along with housing, retail offerings in the city are in short supply, Stropiq executives said.
“If you want anything that doesn’t exist in a grocery store or Wal-Mart, you have to drive two hours,” said Terry Olin, a Stropiq principal and graduate of North Dakota State University in Fargo. “We’d like to change that as fast as we can.”
Stropiq already has a 93-unit apartment complex under development in Williston, with the first building scheduled to open in July, said Ellen Simone Weyrauch, a company principal. 
Folks may recall that General (ret) Petraeus just visited Williston a few weeks ago.
The booming economy has also lured other real estate investors, including KKR, developer of a housing development in Williston. Minot, North Dakota-based Investors Real Estate Trust (IRET) is building two apartment projects in Williston, the 44-unit Dakota Commons and the 288-unit Renaissance Heights, both scheduled to open next year. 
Stropiq Inc was also mentioned in a Reuters story back on June 30, 2013:
While billions of dollars in oil money may be rushing into North Dakota, big money has resisted financing large real estate deals there, barring some projects entirely and leading other developers to self-finance.
Many would-be financiers say the North Dakota oil patch real estate market is too hot to handle right now, with demand for housing outstripping supply, fueling high prices. The average two-bedroom apartment in the oil patch rents for more than $2,500 per month, helping drive land prices sky-high and sparking concern about a bubble. 
National homebuilders such as Pulte Group, D.R. Horton and Hovnanian Enterprises have yet to enter North Dakota. Pulte said it was focused on improving its market share on the East and West Coasts, as well as some Midwest states. The other two declined to comment. 
Some developers have decided to write their own checks in the meantime. Private equity firm KKR, which broke ground last month on 330 apartments as part of a 164-acre housing development, has yet to convince a bank to fund a construction loan. Plans for the total project include 810 apartments and lots for more than 300 single-family homes.

The Washburn Family Of BR Wells In The Charlson Oil Field Have Been Updated

Link here.

This Is One Prairie Dog ERF Will Grow To Love; 110,000 Bbls In Three Months; A Menagerie Of Wells

A random note on this well (data points from the well file are below the spreadsheet; scroll down):

NDIC File No: 23178    
Well Type: OG     Well Status: A     Status Date: 12/20/2013     Wellbore type: Horizontal
Location: SWSE 33-151-94    
Current Operator: ENERPLUS RESOURCES USA CORPORATION
Current Well Name: PRAIRIE DOG 150-94-04A-09H
Total Depth: 21320     Field: SPOTTED HORN (sited in section 33-151-94, but runs south into sections 4/9-150-94)
Spud Date(s):  6/21/2013
Completion Data
   Pool: BAKKEN     Perfs: 11355-21320     Comp: 12/20/2013     Status: F     Date: 1/3/2014     Spacing: 2SEC
Cumulative Production Data
   Pool: BAKKEN     Cum Oil: 110321     Cum MCF Gas: 89743     Cum Water: 62233
Production Test Data
   IP Test Date: 1/3/2014     Pool: BAKKEN     IP Oil: 1812     IP MCF: 2516     IP Water: 966

Monthly Production Data
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN3-20143131658313021205247967479670
BAKKEN2-20142838958396001465133120331200
BAKKEN1-20141625405255741533576760
BAKKEN12-201310143001325720195858008580

From the file report:
  • spud June 21, 2013; final lateral ended on September 18, 2013
  • middle Bakken thickness: about 38 feet
  • "Connection gases were on the average between 4,000 up to over 7,000+ units in the beginning of the lateral dropping to approximately 4,000+ units from midway to less than 1,500 units at the end of hole. We observed a high of 8,600 units peak gas during circulation of bottoms up gas during the first trip out and back in the hole. The trip gas later dropped off to approx 5,000 t0 6,000 units for the latter three trips. A 20 - 40-foot strong yellow to orange-yellow flare ensures."
No frac data was in the file report, unless I missed it.

There are four wells on this pad. One horizontal runs north, but this well, and two others run south. Paralleling this well are:
  • 24752, 1,377, ERF, Bobcat 150-94-04A-09H TF, Spotted Horn, t1/14; cum 51K 3/14;
  • 24753, 1,589, ERF, Fox 150-94-04A-09H, Spotted Horn, t12/13; cum 103K 3/14;
Running north:
  • 23177, 648, ERF, Coyote 151-94-33DH TF, Antelope, t1/13; cum 74K 3/14;

Can Hess, ONEOK Get North Dakota Flaring Down To 10 Percent? Active Rigs Drop To Temporary Low; Global Warming Has Been Very, Very Good For Investors

Tioga / Hess natural gas processing plant, expanded, back on-line. The Bismarck Tribune is reporting:
Hill said that since the upgrades, Hess has reduced natural gas flaring from between 25 and 30 percent to between 15 and 20 percent. The company expects to reduce its flaring in North Dakota to below 10 percent in coming years.
Also, from The Dickinson Press:
The expanded gas plant now produces ethane, a new product for North Dakota. The ethane is transported by pipeline to a plastics plant in Alberta, Canada.
The production of ethane is significant for North Dakota, with several companies looking at petrochemical manufacturing opportunities in the state, said Director of Mineral Resources Lynn Helms.
Active rigs:


5/20/201405/20/201305/20/201205/20/201105/20/2010
Active Rigs187189209178112
 
RBN Energy: one in a series of installments on all the pipeline required to carry natural gas from the Marcellus/Utica. I don't think the average American (including me) realizes how big this story is. Look at the opening paragraph:
Surging natural gas production volumes in the Marcellus/Utica will need to move in just about every direction. No single market—not the Northeast, the Midwest, the Southeast, or even the Gulf Coast—is big enough to absorb it all. Midstream companies are considering every cost-effective way to replumb and expand their existing pipelines to add takeaway capacity, and when still more is needed, are turning to greenfield projects. In this, the first of several company-by-company episodes on who is planning what, we examine Spectra Energy’s plans to add at least 2 Bcf/d of new Marcellus/Utica takeaway capacity by 2017, and maybe another 2 or 3 Bcf/d by the end of the decade.
Along this very same line, PowerSource is reporting:
“The Marcellus is at the epicenter of the change in gas flows across North America,” stated Moody’s in a report released last week. The firm’s data shows that, of the advanced projects nationally meant to increase pipeline capacity by 20 percent by 2017–2018, 88 percent are in the East.
Mihoko Manabe, senior vice president at Moody’s and the report’s author, said those pipelines are transporting Marcellus and Utica gas to a variety of regions.
“The industry wants options,” Ms. Manabe said. “They want to be able to send it to Canada and the Northeast — we all saw the impact of the polar vortex — as well as to the Southeast’s growing power generation market, to hubs around Chicago and to LNG export terminals on the Gulf Coast.” LNG refers to liquefied natural gas.
The Wall Street Journal

Global warming has been very, very good for investors. Good for 22.2%, to be exact.
Growth in utility-company earnings in the first quarter This year's harsh winter weather hobbled the retailing, shipping and construction industries, but the polar vortex powered utilities to higher profits. First-quarter earnings at utilities, which generate electricity and, in many cases, also sell natural gas, were up 22.2% from a year earlier, according to FactSet. That's their largest jump since at least the third quarter of 2008, which is as far back as FactSet's records go. 
The Los Angeles Times

I always wondered when we would get down to these brass tacks? "Mark Twain: Inexcusable racist or man of his time?"
A decision by a Nevada state panel sheds light on another descriptor for the American man of letters held by many, even today: racist.
The Nevada State Board on Geographic Names has voted to delay a decision on whether to name a cove on Lake Tahoe for Samuel Clemens, Twain's real name, after a local tribe complained that the author held demeaning views of Native Americans.
It looks like everyone has WAY too much time on their hands. 

The Future Of Bakken Investment -- Long "Essay" In The Bismarck Tribune

A reader, thank you, alerted me to this long essay on the future of fossil fuel energy in North Dakota. It's too long to dissect now, but you may want to bookmark it, save it somehow. It will probably be archived in the near future.
Currently North Dakota is experiencing major investment into facilities from MDU Resources, Hess and ONEOK. These are a few prime examples of that industry wide investment in North Dakota. John Gibson, CEO of ONEOK and Chairman of ONEOK Partners, said the investment from the petrochemical industry and the special attributes of the Bakken’s wet gas are the reasons for their $3.5 billion investment in North Dakota.
"First off the investment into the natural gas industry is what is driving our interest into the natural gas liquids business. Our natural gas business allows us to gather these raw NGL’s all the way up into the Williston Basin and deliver them to the petchems," Gibson said. "In a cubic-foot of natural gas produced in the Williston (Basin) you will find somewhere around 8-12 gallons of raw natural gas liquids. That’s ethane, propane, butanes all mixed up. If you go down into Oklahoma or the Texas in the pan handle, that same cubic foot will have say, three gallons per MCF."
And, again, from what I can tell, we are talking about a very small footprint in the state of North Dakota. Most of this activity will take place in four or five counties in western North Dakota: two or three counties in northwestern North Dakota and one or two counties in southwestern North Dakota. Almost no primary oil and gas activity east of the Missouri River.