Friday, August 22, 2014

Video Of Weatherford Facility/Complex East Of Williston; British Challenges In The North Sea -- August 23, 2014

Putting the Bakken into perspective. Reuters is reporting:
Britain's oil industry is facing the threat of a cascade of North Sea rig closures, unless ageing platforms can urgently source more gas to help squeeze out the remaining barrels.
The potential threat to oil revenues looms as Scotland prepares to vote in September's independence referendum – a debate in which oil production forecasts have become a political football.
The affected Northern North Sea (NNS) is a very mature part of the basin where producers are trapped in a vicious circle of falling output, rising costs to patch up ageing platforms, and dwindling power supplies.
To lift more oil from these depleted reservoirs, producers need to inject vast quantities of water – a power intensive process that requires a reliable source of energy, known as fuel gas. Some platforms are not able to generate enough of their own fuel so have to try and import the shortfall from neighbours, but the overall net position in a key part of the NNS will go negative as early as 2016.
This could force the early abandonment of rigs, with the loss of critical platform hubs sounding the death knell for dependent fields.
Weatherford Complex East Of Williston
Turn OFF the volume.

Video of the Weatherford complex east of Willison, on the way to Stockyard Creek. This is a relatively new complex, completed in the last couple of years.  Note the new construction on the site near the end of the video.

Weatherford, East of Williston

Twenty-Nine (29) New Permits -- North Dakota; Poor-Quality Video Of New 4-Mile Corner East Of Williston; August 22, 2014; Deere Lays Off 460 Employees At Company's Waterloo, IA, Operations

Active rigs:

Active Rigs192184191192136

Twenty-nine (29) new permits --
  • Operators: Statoil (8), KOG (8), MRO (6), BR (4), Oasis (3),
  • Fields: Cow Creek (Williams), Todd (Williams), East Fork (Williams), Reunion Bay (McKenzie), Robinson Lake (Mountrail), Corral Creek (Dunn)
  • Comments: KOG's 8 permits appear to be on a single pad (NENE 18-156-100); these will join this Jackman well:  21197, 1,100, KOG, Jackman 156-100-18-19-1H, t4/12; cum 214K 6/14;
Wells coming off the confidential list have been posted; see sidebar at the right.

Producing wells completed:
  • 27044, 931, EOG, Parshall 44-1004H, Parshall, t8/14; cum --
  • 27292, 844, EOG, Parshall 62-15H, Parshall, t6/14; cum 8K 6/14;
  • 27923, 94, OXY USA, Elroy Kadrmas 4-3-10H-143-96, Fayette, t7/14; cum --
This might be a good time to scroll through the OXY USA wells.

Sunrise Video Of New 4-Mile Corner, Williston, North Dakota

I drove into Williston at sunrise; unfortunately I turned east, directly into the sun, early in the morning, Thursday, August 21, 2014. The video starts about a mile south of the corner, driving north. Note the speed entering the corner - about 32 mph; and exiting the corner about 23 mph; it will be better once the right-hand entering curve is completed. For what it's worth, here's the poor-quality video:

Poor quality view of the new 4-mile corner, west of Williston, driving into the morning sunrise
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 may have read here.
Trading at new highs today: AAPL, EW, UNP, WPX.

Deere clarifies Waterloo layoffs; ~460 employees to be laid off in response to current market demand for its products: Co announced today that it will place approximately 460 employees who work in the company's Waterloo, Iowa operations on indefinite layoff in response to current market demand for its products. Employees were informed today of the layoffs, which are effective October 20th. These layoffs follow comments from the company during it's 3Q earnings call on August 13th when they said they planned to reduce agricultural equipment production for the balance of the year.

September, 2014, NDIC Hearing Dockets; 24-Wells On Almost Every 640-Acre Unit In The Grail? --- August 22, 2014

The entire summary will be accomplished later. Right now, these are the ones that jumped out at me.

Wednesday, September 17, 2014

22988, MRO, Reunion Bay-Bakken, a) 14 wells on a 1600-acre spacing unit; b) 16 wells on a 1280-acre spacing unit; d) 3 wells on a 1280-acre unit; Mountrail, McKenzie.
22989, QEP, Spotted Horn-Bakken, a) 24 wells on each of 2 1280-acre units; 48 wells on a 2560-acre unit; McKenzie
22993, QEP, Grail-Bakken, 24 wells on all of the 640-acre, 1280-acre, and 2560-acre units within Zones I, II, III, V, VII, VIII, IX, X, and XIII; 7 wells on each 1280-acre unit within Zone VI; McKenize

Thursday, September 18, 2014

23005, SHE, Clarks Creek-Bakken, 18 wells on an existing 640-acre unit; McKenzie
23033, Enerplus, South Fork-Bakkn, 4 wells on each of 2 320-acre spacing units; 7 wells on each of 4 1280-acre units; Dunn
23035, Enerplus, McGregory Buttes-Bakken, 7 wells on each of 5 640-acre units; 7 wells on each of 4 1280-acre units; Dunn
23067, Newfield, Sand Creek-Bakken, 8 wells on an existing 640-acre unit; 
23069, Triangle, Antelope Creek-Bakken, 12 wells on each of 4 1280-acre units; McKenzie
23070, Triangle, Timber Creek-Bakken, 12 wells an existing 1280-acre unit; McKenzie
23071, Triangle, Rawson-Bakken, 12 wells on each of 5 1280-acre units; McKenzie

Tuesday, September 23, 2014
Case No. 23084: In the matter of a hearing called on a motion of the Commission to consider amending the Bakken, Bakken/Three Forks, Three Forks, and/or Sanish Pool field rules to establish oil conditioning standards and/or impose such provisions as deemed appropriate to improve the transportation safety and marketability of crude oil.

Video Of 32nd Avenue, West Of Williston; Screen Shot Of West Williston -- August 22, 2014

Turn the volume OFF on this one; there is no audio accompanying this video, unless you miss the sound of North Dakota wind.

This is driving north on the new 32nd Avenue west of Williston. It was just completed this summer. It connects with US Highway 2 & 85 west of Williston, at the new retail area, and then, with the first of four roundabouts, it heads north to one of the older/newest and biggest subdivisions in Williston, Harvest Hills.

Driving north on 32nd Street west of Williston, connecting northwest residential with southwest retail.

I do not know exactly where the new high school will be built but I was told yesterday it will be "a bit north and a bit west" of the golf course northwest of Williston. The map below shows the likely location based on that description.

Also, note that a brand new subdivision, "The Ridge" is going up north of Harvest Hills. The "old location" refers to the present location of the co-located Williston Middle School and Williston High School. Once the new high school is open, fifth and sixth graders will move to the "old" high school. I understand that yet another elementary school is planned for Williston.

Current location of Williston Middle School, High School; New Williston High School to be built somewhere north and west of the golf course.

From The Coyote blog, this sign in Minnesota: "Due to increases in the Minnesota minimum wage, daily camping rates will increase by $2 in 2015 and an additional $1 in 2016."

Over At Seeking Alpha: Another Halcon TMS Well "Comes In Strong" -- August 22, 2014

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.

TMS: Tuscaloosa Marine Shale. 

Over at SeekingAlpha:
  • Halcón made public test results for its second TMS East well, the Black Stone 4H-2.
  • On a per lateral foot basis, the result is in line with the play's cutting-edge IP rate.
  • Two additional wells, the Fassman 9H-1 and SD Smith 1H, have been successfully drilled and are now in the completion stage.
  • Halcón made a strong case for the TMS' potential to evolve into a highly successful play. 
As a reminder, the Black Stone is Halcón's second operated well on the company's TMS East acreage, and is located in Wilkinson County, Mississippi. The well was successfully drilled with a ~5,400 lateral. After all the 22 frac stages were successfully pumped, Halcón encountered fill during clean-out operations near stage 10. It appears that the company was unable to remediate the situation, and the well ended up producing from a partial wellbore. According to the company's slide (below), only 2,873 feet of the lateral are effectively contributing. The Black Stone tested with a 24-hour IP rate of 553 barrels of oil and 0.5 MMcf of gas. On a three-stream basis, this equates to 715 boe/d, assuming full ethane recovery.
I track the TMS, to some extent, here. 

Remember: many SeekingAlpha articles disappear in a few days, going to "subscriber-only" status. You've been warned.

Permian Shale Upending Oil Prices

I thought I had posted this story; maybe I did. But in case I didn't here it is again (?), the link sent in by Steven. Bloomberg is reporting:
Skyrocketing oil production in the Permian Basin has reversed a decades-old price relationship between heavy and light crude in the U.S.’s largest oil patch.
West Texas Sour traded at a $5-a-barrel premium to West Texas Intermediate in Midland, Texas, yesterday after reaching $10 on August 19, 2014, the highest level in Bloomberg data dating back to 1989. WTS has averaged a 97-cent premium this year after averaging a discount in every year back to 1989.
WTS has historically been cheaper because it’s heavier and higher in sulfur than WTI. The quality difference has meant that pipeline companies move the two grades out of the basin in separate batches.
New shale wells in the Permian have pushed production beyond pipe capacity. Most of the new crude is light, so it’s harder for producers to find space in those batches, Sandy Fielden, director of energy analytics at consultant RBN Energy LLC, said in an interview yesterday.
“There’s more WTI coming out that’s trying to get to pipelines, so it’s more stressed,” Fielden said after a presentation at a conference hosted by RBN and Turner Mason & Co.
The pipeline constraints have made both WTS and WTI in Midland discounted to the U.S. benchmark, which is WTI priced in Cushing, Oklahoma.
WTS was $8 a barrel below the benchmark yesterday, compared with $13 below for WTI in Midland. Midland is the pricing point for Permian crudes. 
RBN Energy is referenced; I think that's where I first noted this -- the Permian upending oil prices, over at an RBN Energy blog posting.

United Begins Non-Stop Flights Houston (Texas) - Williston; Coming Down Indian Hill Into Williston Area -- The Heart Of The Bakken

To get started today, Steven sends this link. The Houston Biz Journal is reporting that hiring in the energy industry in the Houston area is setting new records:
The Houston area added about 5,000 energy jobs in June and July, making the period the most active two consecutive months of hiring since the shale boom began.
The Houston, Sugar Land and Baytown region has now added about 8,700 energy jobs in 2014 through July, more than 7,700 in 2012 and the 4,700 added in 2013, according to U.S. Department of Labor statistics.
I probably would not have led off with that today, except that yesterday's big news in Williston was the inaugural United non-stop flight from Houston (Texas) to Williston yesterday.


RBN Energy:
Vacuum gas oil or VGO is one of those mystery products talked about by refiners but barely understood by those of us that are not engineers. However it is an important intermediate feedstock that can increase the output of valuable diesel and gasoline from refineries. Lighter shale crudes such as Eagle Ford can produce VGO material direct from primary distillation. Today we shed some light on this semi-finished refinery product.
A couple of years ago we posted a two part “tutorial” series on refinery operation basics. The second part of that series described upgrading units in a typical complex refinery that process the heavier and less desirable residual oil output from atmospheric distillation into lighter and more valuable refined products. The first of the upgrade processes that we described occurs in the vacuum distillation column (VDC).  Vacuum distillation recovers gas oil from the residual oil. In layman terms vacuum distillation involves heating the residual oil in a vacuum so that the boiling point temperature is reduced. This allows distillation at temperatures that are not possible in atmospheric distillation since otherwise coke from the heavy residual oil tends to solidify. Vacuum distillation breaks out light and heavy gas oil fractions leaving vacuum residuum that can be further processed by a coker unit or sold as fuel oil.
The light and heavy gas oils output from the VDC are known generically as vacuum gas oil or VGO. There are many different names used in the US and worldwide for VGO but the basic division is between light VGO (LVGO) and heavy VGO (HVGO). When VGO is traded the sulfur content is also important since lower sulfur VGO (0.5% or less sulfur) is more valuable than 2% high sulfur VGO.
Vacuum gas, the mystery gas; sort of like that mystery meat in chicken McNuggets.


Active rigs:

Active Rigs193184191192136

 The Wall Street Journal

Headline story: US eyes wider action on militants. At least they aren't called terrorists.

Lots of stories recently about how much money the oil companies have been borrowing. Here's a front section story in The Journal: with rates low, firms near borrowing records. It's not just the energy industry; it's everyone. "US corporate-bond issuance is hurtling toward a record for the third consecutive year, as companies take advantage of a surprising interest-rate decline to stock up on cash.

Then the very next story: central bankers wrestle with easy money or as we called "foreign money" when we were stationed overseas: "play money."

The Bergdahl swap: the Pentagon's swap was really, really, really illegal. And that story will have no legs. "What does it matter?" Their words, not mine.

US existing-home sales up 4.2%.

Ferguson police tactics challenged (and changed) as conflict evolved. Mostly law enforcement a) let the fire burn out on its own; b) let local citizens take control; c) let the rain quiet things down; and, d) had a meeting with Mr Holder. Talking in code helped. I think the demonstrations pretty much quit when all the "good stuff" was taken.

This will change on an hourly basis, but it's always nice to see a headline like this: US oil prices rose slightly Thursday on tight supply and signs of an improving economy.

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

S&P 500 ends at record.

The Los Angeles Times

Discord in the family: after Israeli attack, Hamas kills 11 suspected informers.

Iraq's Mosul dam remains volatile and unstable. Two words you don't want to see when reading about huge dams: volatile and unstable.

Now it's the earth's surface that is rising due to global warming. "Western drought causes Earth's surface to rise as groundwater drops." Hmmm...maybe that's why my popsicle sticks on the beach aren't showing any rise in ocean levels as predicted by warmists. The beaches are rising also.

The Bakken -- First 24 Hours In Williston

[This is a good sign: having coffee in coffee shop on Main Street, Williston: seven people waiting in line -- 5 are women; two are men. Last year the line would have been longer, it would have been eight men in line. One woman is quite happy; her husband surprised her with an airline ticket; going home to visit family for short vacation. She was warned that some airlines are charging for carry-ons. On top of the $1300-ticket. That's just to get to Minot. LOL.]

Yes, there are a lot more women in Williston this year. I think a lot of college students.

First of all, I apologize for not posting more videos. I have a lot of video, but need faster wi-fi to get it uploaded. It will come. Maybe some photos later today.

I spent all of yesterday in Williston. I really do think traffic is much, much heavier this time -- compared to the last time I was here --  but the last time I was here, there were road restrictions due to rain, mud. However, there seems to be less traffic on the bypass west of Williston. I think trucks are using the new bypass farther west of the city.

There appears to be no police presence, and based on lessons learned in Ferguson (St Louis), Missouri, that explains why there appears to be no wide-spread demonstrations or looting in downtown Williston. The media said that the police presence in Ferguson was responsible for the riots and looting. It's also possible the fact that in Williston "everyone has a job" might be another reason. Whatever.

The big activity on Main Street, Williston, is new road construction. This project was to have started much earlier, but due to some bureaucratic snafus, apparently delayed. A block of Main Street is blocked off; foot traffic is still allowed. 

Thinking back on Ferguson. I've seen the local signs in Belfield have been edited a bit. To this sign, "no shoes, no shirt, no service," they've added: "make sure your pants are pulled up." I would have taken a photo but somehow it didn't seem right.

But there is some crime. Headline story in Williston Herald yesterday: dognapper caught red-handed. Someone trying to steal a puppy from a pet store was caught in the act. I can't make this stuff up. Based on the methods used to try to steal the puppy, my hunch is the dog had a higher IQ than the would-be dognapper. 

Speaking of no police presence, driving into the Bakken yesterday morning was quite an experience. I've alluded to it earlier. From five (5) miles south of Watford City to the 4-mile corner, during blackout conditions (night), fog, major road construction most of the way in an industrial zone: not one flagman, not one highway patrol cruiser with lights flashing; no temporary traffic signals. Traffic signs with speed limits were clearly recommendations only. The best spot to be was behind a truck driver who had traveled the route a thousand times. The worse spot to be was the lead car going through the obstacle course with a fast-moving, fully-loaded 18-wheeler 18 inches off your rear bumper.

[Speaking of which, night-time driving. For cross-country driving, what is more important, the sun or the moon? Clearly, the moon. The moon provides the only real light during night; the sun is out during the day when it's already light anyway.]

Having said that, I have huge respect for the truckers; of all the folks I think who are underpaid across the nation, the truckers may be at the top of my list. Seriously. Maybe they are well paid in the oil patch but there are any number of stories written in the national press about the shortage of truck drivers, the low pay, long hours, and time away from home. 

The first five videos I have are of driving into Williston. Some folks are going to get upset that I don't have videos of the oil patch. Those videos are coming.

This is a video of driving into the Williston area just after the sun had come up. I had been driving for 40 straight hours -- two short cat naps somewhere along the way -- and I was now into the home stretch. I had just experienced some of the most harrowing urban construction driving in my life (Watford City area), and I was now on a clear, fast road. This is coming down Indian Hill, south of Williston, driving north toward the river. I was unable to keep up with the trucks ahead of me, and obeying the unwritten rule in the Bakken, "if you can see headlights in your rear view mirror you are not driving fast enough," I was doing what I could to keep traffic moving.

For folks on the east coast watching this, note that trucks coming up hill are in the fast lane; personal automobiles are in the slow lane. Also note: there are no barriers between 'uncoming" traffic lanes.

Driving north into Williston area, south of Williston, coming down Indian Hill, 
August 21, 2014, about 7:45 a.m. CDT

Also, for the environmentalists: note -- no flaring seen in this video, and it was five minutes of filming in the heart of the Bakken. Yes, Virginia, there are some areas in the Bakken where one does not see any flaring. Another area: anywhere near the national parks.