Monday, August 10, 2015

Initial production numbers have been posted for wells coming off the confidential list over the weekend, today.

Active rigs:

	8/10/2015	08/10/2014	08/10/2013	08/10/2012	08/10/2011
Active Rigs	72	193	184	200	190

RBN Energy: continuing series on Bakken CBR. (Archived)

This time we turn to the future of rail shipments to the West Coast from North Dakota.
The chart in Figure #1 (at the link) provides a summary of CBR shipments to the West Coast from North Dakota. The blue and red shaded areas against the left axis represent crude volumes shipped from Petroleum Administration for Defense District (PADD) II – the Midwest to PADD V – the West Coast.

This data comes from Energy Information Administration (EIA) monthly crude rail movement estimates that began publishing in April 2015 (see A Look At The Rail Track Record). Because the EIA does not break this data down within PADDs we assume that it largely covers CBR movements between North Dakota and West Coast refineries located in Washington State and California. This assumption is based on the location of rail loading terminals in PADD II (most are in North Dakota) and rail unloading terminals on the West Coast that are mostly linked to refineries in Washington and California.

Having made that assumption we further separated out CBR shipments to California from North Dakota (red shaded area) that are reported separately by the California Energy Commission (CEC).

The CBR shipments to Washington (blue shaded area) are simply the EIA PADD II to PADD V totals minus California. Note also that shipments to California are a fraction of the total – just 2-5 Mb/d in 2013 and 2014 and (according to CEC) have been zero since November 2014. So West Coast CBR from North Dakota is almost all headed to Washington State. The yellow line on the chart against the right axis is the ANS premium to WTI crude. ANS – Alaska North Slope - is the West Coast benchmark crude and West Texas Intermediate – WTI crude is the Midwest benchmark.

To sum up – West Coast CBR shipments from North Dakota remain firmly routed in supplying Washington State refineries for the moment. As such – the shipments will expand if and when Shell gets their permit – but only by 65 Mb/d or so. There is also a good possibility that one or more of the rail to marine port terminal projects in Oregon or Washington will eventually be built – that could increase Bakken crude shipments to California. There is also likely to be a slow increase in CBR shipments to California as unload terminals there are permitted – but pipelines such as the Inland California Express may overshadow these in due course. For the moment there is no apparent end of the line for CBR shipments from North Dakota to Washington refineries.

Much, much more at the link. Bottom line: could the Bakken become the option of choice for out-of-state oil for California refineries?

Note: ANS – Alaska North Slope - is the West Coast benchmark crude and West Texas Intermediate – WTI crude is the Midwest benchmark.