Motley Fool Has An Article On Triangle Petroleum -- June 20, 2014

Motley Fool has an article on Triangle Petroleum:

Triangle is essentially three companies in one. The company has three subsidiaries, wholly owned Tusa (an exploration and production company), RockPile (a wholly owned energy services subsidiary), and Caliber Midstream (of which Triangle is the majority owner.) 

Tusa is Triangle's most interesting asset. Tusa is targeting rapid production growth from its Williston Basin acreage. The company is currently in the middle of a four-rig drilling program aiming to drive production up to 12,600 barrels of oil per day in the best-case scenario by the second half of 2015.

For the most part, Triangle's RockPile subsidiary is doing most of the drilling work, although Tusa is not RockPile's only customer. During the first quarter of this year, RockPile completed five wells for Tusa and five for third parties. By the fourth quarter, management expects around 64% of RockPile's business to be with third parties.

And then this:

On a pro forma basis, this now brings Triangle's proved reserve base to 47 million barrels with a further 611 drilling locations. That's a 14% increase in current production and 11% increase in proved reserves. The acquisitions have increased the company's drilling inventory by five to eight years.

In total, Triangle acquired these assets for $125 million, a tad over $2,700 per acre and approximately $28 per barrel of proven reserve.

Value:

Management estimates that RockPile is worth $6.66 per Triangle share, while Caliber is worth around $2.50. In total, these assets are worth $9.16 per share; this places a value of $2.4 per share on the E&P business, based on the share price at time of writing.

That's an exploration and production company with current production of 10,000 barrels per day, targeting 12,000 by year end, that's worth $206 million.

Last week almost every oil and gas exploration and production was trading at or near new highs and I didn't have a chance to check the headlines or stories. This evening, I was curious if there were any headline/stories that might of interest.

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

Fidelity (MDU) Has A Gusher In Heart River; Several Nice Wells Coming Off Confidential List Monday, June 23, 2014; Whiting Will Report A Elkhorn Ranch Well; China Continues To Buy High-Price Oil For Its SPR; North Dakota Unemployment Drops Again

Monday, June 23, 2014:

• 23880, 1,120, Fidelity, Norken 17-20H, Heart River, t12/13; cum 61K 4/14;
• 25539, 330, Whiting, Neru 0904ERH,  Elkhorn Ranch, a Madison well, t1/14; cum 27K 4/14;
• 26270, 1,332, Emerald Oil, Pirate 5-2-11H,  Foreman Butte, t12/13; cum 50K 4/14;
• 26479, conf, CLR, Brogger 4-4H, Crazy Man Creek, no production data,
• 27022, drl, Hess, HA-Nelson A-152-95-3427H-5, Hawkeye, no production data,
• 27072, drl, BR, Norman 11-4MBH, Johnson Corn, no production data,
• 27099, drl, Hess, EN-Johnson-155-94-2017H-4, Manitou, no production data,

Sunday, June 22, 2014:

• 26191, drl, CLR, Montpelier 3-14H1, Indian Hill, no production data,
• 26499, drl, Hess, GN-Avinder-158-98-1423H-1, Rainbow, no production data,
• 26751, A, CLR, Fedeler 1-33H,  Charlie Bob, no IP, cum 5K 4/14;

Saturday, June 21, 2014:

• 26422, drl, KOG, P Manning 154-99-2-2-11-15H, Stockyard Creek, no production data,
• 26545, 1,631, Newfield, Skaar 150-99-15-22-2H, South Tobacco Garden, t3/14; cum 29K 4/14;
• 26562, 310, American Eagle, Uncompahgre State14-36-164-101, Colgan, t4/14; cum 8K 4/14;

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23880, see above, Fidelity, Norken 17-20H, Heart River:

Date	Oil Runs	MCF Sold
4-2014	13756	0
3-2014	7717	0
2-2014	10893	0
1-2014	18800	0
12-2013	9672	0

 
26545, see above, Newfield, Skaar 150-99-15-22-2H, South Tobacco Garden:

Date	Oil Runs	MCF Sold
4-2014	14960	2660
3-2014	13298	9122

25539, see above, Whiting, Neru 0904ERH,  Elkhorn Ranch, Billings County. The "ERH" refers, obviously, to Elkhorn Ranch, but why? From the file report --

• Total depth: 16,865 feet
• Vertical depth: 9,343 feet
• VS: 7,728 feet
• Target: Mission Canyon (Elkhorn Ranch); target window -- four (4) feet;
• Spud date: November 6, 2013
• Cease drilling: November 19, 2013
• Background gas in the lateral: 107 - 135 units
• Acres in spacing unit: 7,360 
• Production to date:

Date	Oil Runs	MCF Sold
4-2014	5366	10813
3-2014	7264	11260
2-2014	7700	1361
1-2014	6292	4879
12-2013	71	73

Other links for Elkhorn Ranch oil formation in North Dakota:

• Evolution of the Middle Bakken horizontal drilling, August, 2004, a PowerPoint Presentation
• Hydrodynamic trapping in this formation; April 7 - 10, 1991 AAPG annual convention

I don't find many "Mission Canyon" wells at the NDIC web site. Also, it appears that Elkhorn Ranch formation is lumped together with the "Mission Canyon" and not followed separately. [The NDIC is calling this a "Madison" well.]

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North Dakota Unemployment Rate -- Even Lower

The already lowest unemployment rate in the US dropped even lower this past month. The Dickinson Press is reporting:

The unemployment rate in North Dakota continued its downward trend in May, taking a slight dip from April, according to a monthly jobs report released Friday by Job Service North Dakota.

The non-seasonally adjusted rate saw a 2.4 percent unemployment rate across the state, down from April’s rate of 2.6 percent.

Unemployment has held steady for much of this year after hitting 3.3 percent in January. It has stayed under 4 percent since January 2013.

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For Investors

A top story over at Yahoo!Finance over the weekend: five oil stocks hit new highs last week (actually it was a whole lot more than five):

Friday was a big day for oil and gas production companies. The country’s three largest and many others hit new 52-week highs, and it is not entirely due to the turmoil and uncertainty in Iraq. U.S. companies produce little oil in Iraq, although some do have stakes in large projects that are currently in the exploration and development phase and could turn out to be major producers in the future.

In addition to the uncertainty about Iraqi supply, there are other pressures on crude prices. China has been purchasing oil for its strategic reserves, even though prices are high. China is squabbling with Japan and Vietnam over territory, and the country wants to build up its reserves to 100 days of net imports by 2020.

The first phase of China's strategic build-up amounted to 103 million barrels and was completed in 2009. The second phase was supposed to add 169 million barrels to the reserve but since has been raised to 245 million barrels. The second phase is expected to be completed by 2015. The country is now building storage tanks for the third phase to hold an additional 152 million barrels.

That is 500 million barrels, of which most could have been left in the ground, just as most of the 750 million barrels in the U.S. strategic reserve could have been. That unnecessary demand plays a significant role in the rising price of crude, regardless of whether a producer sells to China.

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.

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Obfuscation

Senator Charles Schumer concerned about US soccer fans returning with mosquito-borne virus; says nothing about real epidemic diseases being brought in by Central American immigrants invited in en mass by President Obama. But it makes sense when you read the article. Senator Schumer is worried about these well-heeled Americans coming back to his state and wants the CDC to issue a health alert. He will let the Texas, Arizona, New Mexico, and California authorities worry about their own states. Nice of him.

It will be interesting to see, however, if Senator Schumer requests a similar CDC health alert when the Feds house thousands of these Central American immigrants in New York state. I'm not holding my breath.

The first comment below refers to the 75 scientists at the CDC who were exposed to "live" anthrax. Easily found by googling. Article in the New York Times, two days ago.

Human Interest Story On Oilfield Worker Who Began His Career In The Oil Patch Working On Clarence Iverson #1: Raymond Magnuson

The Dickinson Press has a human interest story on Raymond Magnuson, 87, who began is oilfield career working on the Clarence Iverson #1 oil well, over sixty years ago:

He began his oilfield career on the well that put North Dakota on the map as an oil-producing state: the Clarence Iverson No. 1 well, the state’s first successful oil well.

The brutal winter was too harsh for some out-of-state workers, he said. Magnuson, who started as a floorhand, remembers driving on a prairie trail to the well south of Tioga and getting stranded for two or three days without food during winter storms.

“Tough winter. Tough year. It ain’t like they got it nowadays at the rigs,” Magnuson said.
An April 4, 1951, test at the Clarence Iverson well marked the discovery of oil in North Dakota.

And more:

His next job was another notable well in North Dakota — the H.O. Bakken well, the namesake for the Bakken formation. There, he earned 20 cents more an hour.

Much more at the linked article.

For more background:

• The first Bakken well, November 24, 2012
• Anniversary, April 4, 2011
• Several references to Clarence Iverson #1, January 9, 2011
• Clarence Iverson dies, December 2, 2010

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Global Warming House Of Cards Falling? 
The Decade of the 1930's: Hottest Ever in Recorded History

Ever Since: Cooling

The (London) Telegraph is reporting: 

When future generations try to understand how the world got carried away around the end of the 20th century by the panic over global warming, few things will amaze them more than the part played in stoking up the scare by the fiddling of official temperature data. There was already much evidence of this seven years ago, when I was writing my history of the scare, The Real Global Warming Disaster. But now another damning example has been uncovered by Steven Goddard’s US blog Real Science, showing how shamelessly manipulated has been one of the world’s most influential climate records, the graph of US surface temperature records published by the National Oceanic and Atmospheric Administration (NOAA).

Goddard shows how, in recent years, NOAA’s US Historical Climatology Network (USHCN) has been “adjusting” its record by replacing real temperatures with data “fabricated” by computer models. The effect of this has been to downgrade earlier temperatures and to exaggerate those from recent decades, to give the impression that the Earth has been warming up much more than is justified by the actual data. In several posts headed “Data tampering at USHCN/GISS”, Goddard compares the currently published temperature graphs with those based only on temperatures measured at the time. These show that the US has actually been cooling since the Thirties, the hottest decade on record; whereas the latest graph, nearly half of it based on “fabricated” data, shows it to have been warming at a rate equivalent to more than 3 degrees centigrade per century.

When I first began examining the global-warming scare, I found nothing more puzzling than the way officially approved scientists kept on being shown to have finagled their data, as in that ludicrous “hockey stick” graph, pretending to prove that the world had suddenly become much hotter than at any time in 1,000 years. Any theory needing to rely so consistently on fudging the evidence, I concluded, must be looked on not as science at all, but as simply a rather alarming case study in the aberrations of group psychology.

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Hillary's Heart Problem

After Benghazi, I'm Not Sure She Had One -- "What Does It Matter?"

Sounds like she has atrial fibrillation: fainting, blood clots, and bad valve.

Random Update Of Sempra LNG Export Facility In Louisiana -- Seeking Alpha -- June 22, 2012

Updates

November 2, 2018: Cameon/SRE/Louisiana -- commissioning process begins.
September 11, 2014: final approval. Lawmakers want more.
 

Original Post

On June 15, 2014, I noted in passing, without providing a link that Texas LNG had been granted a license to export up to 2 million tons of LNG annually. I assume I posted the announcement that Sempra Energy was also granted an export license this past week to export LNG, but I can't find it. Never mind. Seeking Alpha is reporting:

• On Thursday, Sempra's facility in Louisiana was approved to export LNG to other countries.
• Because Sempra is only the second company in the United States to be approved, this presents a great opportunity for the company.
• If sold at current prices, the LNG from the approved facility could bring in between $3 billion and $5 billion in revenue per year.

One of Sempra Energy's facilities was recently approved to start exporting liquefied natural gas (LNG). Because of the drastic difference in price between American natural gas and LNG import prices in European and Asian countries, Sempra could see large amounts of revenue from the facility.

There is a great photograph of the facility at the linked site above:

Sempra's approved facility (known as Cameron LNG) is located along the Calcasieu Channel in Hackberry, Louisiana. Because it lies only 18 miles from the Gulf of Mexico, it is in good position to quickly liquefy natural gas and move it to whoever needs it across the globe.

In terms of supply, Cameron LNG is within 35 miles of a pipeline hub that connects 5 natural gas pipelines which should be able to provide the facility with all the natural gas it needs.

And then this:

Sempra is only the second company approved to export LNG. Cheniere Energy was the first company to have a facility approved by both government agencies. Cheniere's Sabine Pass facility was approved back in April 2012. Construction on the facility began in late 2012 and the project is expected to be completed by late 2015.

Once the expansion of Sempra's facility is complete, Cameron LNG will be comprised of three liquefaction trains capable of exporting up to 12 million tons of LNG per year. Below is a graphic of the proposed facility.

Much more at the link, including some great graphics. SeekingAlpha is archiving more and more of their articles for paid subscription. 

Memo to self: page saved.

The Future Of The National Electric Power Grid; A Long Article On Exelon; A Must-Read; Bookmark -- June 22, 2014

Updates

July 4, 2016: update on Exelon in Illinois.
 

Original Post

 

A reader has sent a very, very good article on future of US utilities and the national power grid, using Exelon as a contemporary case study. It's an article that should be read by anyone interested in the Bakken, and now, perhaps, the "Sleeping Giant." If one does not have the time to read it today, bookmark it for future reference. It's been my experience that many of these stories are eventually archived for subscribers only or removed completely from the net at some point in the future.

ChicagoBusiness is reporting:

Six years ago, Exelon Corp. held the strongest hand in the power industry. Power prices were soaring, and profits at the Chicago-based company's large fleet of nuclear power plants were rising along with them.

Prospects for federal legislation to set a price on carbon emissions and combat climate change were buoyed by expectations that Democrats would retake the White House that year. With a nearly carbon-free fleet operating exclusively in markets where regulators don't limit what power plants can charge, Exelon appeared better positioned than any of its rivals.

In April 2008, with a stock price nearing its all-time high of $91.64 per share, Exelon CEO John Rowe made what amounted to a victory speech in a conference call with analysts. 

That was six years ago. This is now:

Gas prices still haven't recovered. And neither have Exelon's fortunes.

Now at $36.76, Exelon's stock has fallen 60 percent since its July 10, 2008, peak, more than any other major utility in the U.S. during that period.

As its nuclear plants increasingly look like an albatross rather than a boon, Exelon is at a crossroads. The future of power generation and distribution is uncertain, but demand for electricity is slack and likely to remain so because of improvements in energy efficiency. Many predict that the industry gradually will move away from behemoth central power stations like Exelon's nukes. Instead, it would feature smaller plants that can cycle on and off with fluctuations in demand coupled with on-site power sources in homes and businesses such as solar panels or even small-scale natural gas generators. 

I don't invest in Exelon, never have, never will, and I'm more interested in the article for the discussion of the future of the national electricity grid. Even experts come down on opposing sides what the future holds. 

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

Another story line: if this could happen to Exelon, it could happen to other utilities. MDU must be watching this play out very, very closely. 

Previous stories on Exelon:

• Obama's war-on-coal has come home to roost, May 27, 2014.
• CBR terminal on leased land near an aging Philly Exelon nuclear reactor, May 14, 2014
• Illinois at risk of losing three of six Exelon nuclear reactors, March 2, 2014.
• In a post-nuclear world, going, going, ... gone, October 31, 2013.
• Exelon kicked off wind board, September 11, 2012.
• Exelon announces first big sale of coal-fired US power plants in four years, June 8, 2012
• Demise of the US coal industry, June 8, 2012
• Cheap natural gas throws energy markets into turmoil, February 4, 2012
• Deere sells wind business to Exelon, December 10, 2010

New Pipeline Proposal For Southwestern North Dakota To Feed MDU/Calumet Refinery West Of Dickinson, North Dakota -- The Bakken

I will add this new pipeline to "Pipelines of Interest." In The Bismarck Tribune, July 12, 2014.

Belle Fourche Pipeline Company proposes to build a new 10-diameter, 20-mile long crude oil pipeline, to parallel an existing pipeline. PDF: http://www.psc.nd.gov/public/newsroom/2014/docs/6-23-14BelleFourchePipeline.pdf

Capacity: 100,000 bopd

Cost: $8 million (rounded)

Origin: Billings County

Terminus: Dakota Prairie Refining facility / CBR west of Dickinson

Note: this will be another 100,000 bopd coming to this terminal (refinery and CBR); it parallels an existing Belle Fourche pipeline; the 165,000-bopd pipeline from Killdeer to Dickinson was recently completed. See link at top of post.

Comment: It looks like the origin is in St Demetrius oil field, an oil field pretty much owned/controlled by CLR.

CLR got all the early permits for St Demetrius oil field. It's hard to believe, but I don't see any new permits were issued for that field in all of 2013.

Then, so far this year, a new player: Emerald Oil has 6 new permits in that field (the Mary Samsonite wells; two 3-well pads in the same section) and CLR has one new permit in St Demetrius oil field, so far this year.