Monday, April 13, 2015

Williston To Take Jurisdiction Over $500 Million Shopping Hub -- April 13, 2015 is reporting:
A Swiss company planning a $500 million development on Williston’s outskirts likely will need to get a building permit from the city rather than the county. 
The city has notified Williams County that it plans to exercise its 1-mile extraterritorial jurisdiction, meaning the Williston Crossing project proposed by the international real estate company Stropiq will fall under city jurisdiction
The Williams County Commission last week approved the project, but there was debate about the company’s chosen location. Williston Mayor Howard Klug said he wished Stropiq had chosen a site within city limits. Klug told the Williston Herald that the city’s move to exercise extraterritorial jurisdiction isn’t aimed at just that project, which is to include more than 1 million square feet of retail, entertainment, office and hotel space. 
“This is about the future of the city of Williston, and what’s going on in the extraterritorial jurisdiction,” he said. “If and when we annex it, we want to make sure it’s something we can bring into the city to our standards.” 
Klug cited as an example two crew camps located on property that the city recently annexed. They had to be retrofitted with expensive sprinkler systems and two of the camps were shut down after missing the deadline. One of them has sued.
Did anyone think this wouldn't happen? LOL.

"No One Will Buy The Apple Watch"

Reuters is reporting:
Apple Inc is likely to quickly ramp up production of the Apple Watch after strong pre-orders outstripped limited supply.

Apple's website lists shipping times in June for some models, and four to six weeks for others, suggesting the company is straining to meet demand. 
However, analysts said Apple could sell between 2.3 million and 4 million watches in the quarter ending June.Apple was widely expected to disclose pre-orders on Monday, following its usual pattern after a product launch.
But Piper Jaffray analyst Gene Munster said this may not happen this time because of the supply issue.
"Overall we view the trends over the weekend as an indication of solid demand paired with very limited supply, with supply being the most significant limiting factor," Munster said in a client note.
Munster, who thinks Apple will sell 2.3 million watches in the April-June quarter, expects the company to ramp up production between mid-May and June.

Active Rigs At 91; Eight (8) New Permits -- April 13, 2015

Active rigs at 91; lowest level during boom, I believe:

Active Rigs91189186208173

Eight (8) new permits:
  • Operators: Whiting (4), Oasis (4)
  • Fields: Pembroke (McKenzie), Camp (McKenzie)
  • Comments:
Four (4) producing wells completed:
  • 27161, 583, Hess, GN-Tom Jen-157-97-0409H-2, Ray, t3/15; cum -- 
  • 28552, 1,302, XTO, HM Hove 34X-33G, West Capa, t3/15; cum --
  • 28553, 1,580, XTO, HM Hove 34X-33D, West Capa, t3/15; cum 6K 2/15;
  • 29385, 387, Petro-Hunt, State 159-94-25B-36-1H, East Tioga, t4/15; cum --
Wells coming off the confidential list Tuesday:
  • 26932, dry, CLR, Patterson Federal 6 PA, Camp, no explanation in file (that I could see; probably a bad casing)
  • 27638, 201, Fidelity, Isadore 6-7H, Heart River, t12/14; cum 17K 2/15;
  • 28136, drl, WPX, Edward Flied Away 7-8-9HZ, Van Hook, no production data,
  • 28914, 1,647, Hess, EN-VP and R-154-94-2536H-2, Alkali Creek, t3/15; cum 12K 2/15 5 days
  • 29034, A, CLR, Hayes 2-6H, Crazy Man Creek, test data not given; 9 days production in 2/15, 1,628 bbls
  • 29482, SI/IA, Statoil, Charlie Sorenson 17-8 4H, Alger, no production data, 

Case Study Suggesting New Flaring Rules Are The Long Pole In The Tent, Not The Price Of Oil -- April 13, 2015


June 20, 2021: there are currently 16 wells/drilling sites in this drilling unit. There is "room" for sixteen more though we probably won't see that for many, many years. 

June 6, 2021: updated graphic --

June 6, 2021: Hess is starting to report the newest EN-VP and R-wells  --

Hess is starting to report some new EN-VP and R-wells in Alkali Creek.

Four four-well pads = a 16-well pad:


  • 33732, 2,078, Hess, EN-VP...H-12, Alkali Creek, t5/18; cum 433K 4/21;
  • 33731, 1,631, Hess, EN-VP...H-11, Alkali Creek, t5/18; cum 134K 1/20; sporadic after 1/20;
  • 33730, 2,056, Hess, EN-VP...H-10, Alkali Creek, t5/18; cum 328K 4/21;
  • 33729, AB/1,506, Hess, EN-VP...H-9, Alkali Creek, t5/18; cum 148K 1/20;


  • 28916, IA/1,230, Hess, EN-VP...H-4, Alkali Creek, t3/15; cum 231K 1/21; sporadic since then;
  • 28915, 1,194, Hess, EN-VP...H-3, Alkali Creek, t3/15; cum 201K 4/21;
  • 28914, 1,647, Hess, EN-VP...H-2, Alkali Creek, t3/15; cum 178K 3/21;
  • 28913 1,711, Hess, EN-VP...H-1, Alkali Creek, t2/15; cum 298K 4/21;

SW (newest of the four pads):

  • 36851, conf, Hess, EN-VP ..H-1, Alkali Creek, first production, 12/20; t--; cum 130K 4/21;
DateOil RunsMCF Sold
  • 36850, conf, Hess, EN-VP ..H-15, Alkali Creek, first production, 12/20; t--; cum 130K 4/21;
DateOil RunsMCF Sold
  • 36849, conf, Hess, EN-VP ..H-14, Alkali Creek, first production, 12/20; t--; cum 120K 4/21;
DateOil RunsMCF Sold
  • 36848, conf, Hess, EN-VP ..H-13 Alkali Creek, first production, 12/20; t--; cum 105K 4/21;
DateOil RunsMCF Sold


  • 31283, 1,421, Hess, EN-VP ..H-8 Alkali Creek, t11/16; cum 316K 4/21;
  • 31282, 1,346, Hess, EN-VP ..H-7 Alkali Creek, t11/16; cum 244K 4/21;
  • 31281, 746, Hess, EN-VP ..H-6 Alkali Creek, t11/16; cum 271K 4/21;
  • 31280, 1,612, Hess, EN-VP ..H-5 Alkali Creek, t10/16; cum 273K 4/21;

July 4, 2018: the other EN-VP and R- wells not listed below (in addition, #28913 - #28916, inclusive with updated frack data):

  • 33730: 2,056;  t4/18; middle Bakken; 9 days to TD; 60 stages; 8.3 million lbs, large, medium;  in first sixteen days: 26,686 bbls; cum 327K 1/21;
  • 33729: IA/1,506, t5/18; Three Forks 2nd bench, 13 days to TD;  60 stages; 8 million lbs; large, medium; in first 19 days, 13,335 bbls; cum 148K 1/20;

  • 28916, 1,230, t3/15; middle Bakken; 35 stages; 3.5 million lbs; large, small; drilling rig, October 20, 2014; cease drilling, December, 2014; bump in production; cum 231K 1/21;
  • 28915, 1,194, t3/15; Three Forks NOS, 35 stages; 3.5 million lbs; large, small; drilling rig, November 17, 2014; cease drilling, December 18, 2018; cum 197K 1/21;
  • 28914, 1,647, t3/15; middle Bakken; 35 stages; 3.5 million lbs; large, small; drilling rig, November 9, 2014; cease drilling, December 8, 2014; cum 178K 1/21;
  • 28913, 1,711, t2/15; Three Forks NOS, 35 stages; 3.5 million lbs; large, small; drilling rig, November 17, 2014; cease drilling, December 1, 2014; cum 294K 1/21;

  • 31283, 1,421, t11/16; middle Bakken; 53 stages; 3.7 million lbs; large, small; off-line as of 1/18; drilling rig, August 20, 2016; cease drilling, August 31, 2016; cum 312K 1/21;
  • 31282, 1,346, t11/16; Three Forks NOS; off-line as of 3/18; 57 stages, 3.9 million lbs; large, small; drilling rig, August 1, 2016; cease drilling, August 16, 2016; cum 239K 1/21;
  • 31281, 746, t11/16; middle Bakken; 57 stages; 4 million lbs; large, small; off-line as of 4/18; drilling rig, July 20, 2016; cease drilling, July 29, 2016; cum 263K 1/21;
  • 31280, 1,612, t10/16; Three Forks NOS,  53 stages; 3.7 million lbs; large, medium; nice jump in production after off-line for less than one month (4/18); spud date, July 7, 2016; cease drilling, July 16, 2016; cum 266K 1/21;
July 3, 2018: DUCs reported as completed:
  • 33731, 1,631, Hess, EN-VP and R-154-94-2536H-11, Alkali Creek, Three Forks 2nd bench, TVD = 10,903 feet; spud date, January 2, 2018; cease drilling, January 13, 2018,  API - 33-061-04084, fracked 4/13/18 - 4/18/18, 6.4 million lbs water; 86.7% water, 12.9% sand; and 4/18/18 - 4/23/18, 6.75 million gallons, 87.1% water; 12.49% sand;  t5/18; in first 13 days, 15,656 bbls; cum 134K 1/20; some erratic production since then;
  • 33732, 2,078, EN-VP and R-154-94-2536H-12, middle Bakken, TVD = 10,727 feet, spud date, January 16, 2018; cease drilling, January 25, 2018, Alkali Creek; API 33-061-04085, fracked 4/9/19 - 4/13/18; 5.7 million gallons of water; 84.8% water; 14.9% sand, t5/18; in first 10 days, 14,137 bbls; cum 425K 10/20;
April 22, 2015: all four EN-VP and R wells have now come off the confidential list. 
  • 28913, 1,711, Hess, EN-VP And R-154-94-2536H-1, Alkali Creek, t2/15; cum 294K 1/21; still flaring (8/15)
  • 28914, 1,647, Hess, EN-VP and R-154-94-2536H-2, Alkali Creek, t3/15; cum 178K 1/21; still flaring (8/15)
  • 28915, 1,194, Hess, EN-VP and R-154-94-2536H-3, a Three Forks well, Alkali Creek, 35 stages; 3.5 million lbs sand,  t3/15; cum 198K 1/21; small bump in production 5/18 after coming back on line; still flaring (8/15)
  • 28916, 1,230 Hess, EN-VP and R-154-94-2536H-4, Alkali Creek, t3/15; cum 231K 1/21; small bump in production after coming back on line; still flaring (8/15)
 The reader noted a couple of things:
As an aside, the NDIC reports the EN-VP and R H-1 February oil production of 29,202 barrels in 27 days.  I believe this is in 19 days since the well was completed 2/12, not 2/1.
Original Post

A reader sent me this note (some editing):
The reader noted that the following well came off the confidential list today:
  • 28915, 1,194 (updates above, Hess, EN-VP and R-154-94-2536H-3, a Three Forks well, Alkali Creek, 35 stages; 3.5 million lbs sand,  t3/15, 
The reader noted that the well file now contains a Gas Capture Plan, pages 113 - 119 for the H-3, that includes an affidavit to a third party gatherer; oil and gas production forecasts; layouts of proposed connections to gas gathering lines; and, technology information of flaring alternatives. 
A sister well, 28916, EN-VP and R H-4 came off the confidential list last Friday in DRL status; the reader suspects this well was completed and began production the latter part of March. 
Two other sister wells; 28913, EN-VP and R H-1 and 28914, EN-VP and R H-2; were reported on March activity reports as Confidential Wells Plugged Or Producing. The H-1 shows February oil production of 27,809 barrels for some unknown period and the H-2 11,843 barrels. The H-2 is coming off the confidential list tomorrow and the H-1 off the list on Thursday
The timing for these wells' initial production is pretty much in line with the H-3 well file's production forecasts, page 117. 
All this seems to suggest that the ability to handle gas output, which has been a key factor, may now be the critical path for the timing of well completion and production
As an aside, the pad layout on page 97 shows 20 proposed wells, and the Surface Use Agreement, page 111, lists 18 wells to be operated on the site. The pad is located in section 24 and the spacing unit is 1280-acres, sections 25 and 36.
My reply:
Very, very interesting -- I've mentioned the headwinds for completing wells:
  • low prices  
  • conditioning for CBR 
  • flaring rules 
It appears low prices may move operators to the sweet spots, etc., etc., but once the wells are drilled, the question is which of the three headwinds is the long pole in the tent with regard to completing the well. I had not thought about that lately -- simply thinking that it was the low price. 
But I think you are correct. Low prices will determine who drills, where they drill, and how much they drill, but the critical path for completing a well may depend on natural gas gathering capabilities. Most recently the NDIC told five operators to "choke back" production because they were exceeding flaring standards; and, XTO has requested a waiver for some 140 wells.  It appears the operators have found a relatively low-cost way to "condition" Bakken oil for CBR, and even if they didn't, it seems there is more pipeline capacity. 
A minor comment: it's interesting to see all this talk about flaring. All this talk about flaring might confuse newbies, or cause old-timers like me to forget: the Bakken is an oil field. In general, 95% of Bakken well production is oil, compared with, I think, 70% - 80% in other two well-known oil plays, the Permian and the Eagle Ford.

A bit more on the amount of time for to drill this well:
  • the surface spud, October 12, which I assume took a day or so
  • the vertical hole with the big rig spud October 31, 2014
  • total vertical depth reached November 3, 2014 (about 4 days to drill with the big rig to vertical depth)
  • lateral was drilled in five days and 22 hours
The general area of the EN-VP and R wells:

Zooming in:

Monday Afternoon - Miscellaneous -- April 13, 2015

Conoco to see non-core assets. Reuters is reporting:
ConocoPhillips is preparing the sale of noncore oil and gas producing acreage in the United States, in the latest sign that oil majors are becoming more accepting of lower oil prices, according to people familiar with the matter. 
While the world's oil and gas companies have been looking to buy assets on the cheap since oil prices plummeted, epitomized by Royal Dutch Shell Plc's agreement earlier this month to buy BG Group Plc for $70 billion, they have been reluctant to sell assets in case oil prices recover and they can fetch more. 
ConocoPhillips has hired Wells Fargo to sell some of its noncore U.S. assets, the people said on Monday. These assets include oil and gas properties in the Rockies, East Texas, South Texas and Northern Louisiana, according to one of the people.

Whose Side Is Mr Obama On?

Reuters is reporting:
Russia paved the way on Monday for missile system deliveries to Iran and started an oil-for-goods swap, signaling that Moscow may have a head-start in the race to benefit from an eventual lifting of sanctions on Tehran. The moves come after world powers, including Russia, reached an interim deal with Iran this month on curbing its nuclear program. The Kremlin said President Vladimir Putin signed a decree ending a self-imposed ban on delivering the S-300 anti-missile rocket system to Iran, removing a major irritant between the two after Moscow canceled a corresponding contract in 2010 under pressure from the West. 
A senior government official said separately that Russia has started supplying grain, equipment and construction materials to Iran in exchange for crude oil under a barter deal. Sources told Reuters more than a year ago that a deal worth up to $20 billion was being discussed and would involve Russia buying up to 500,000 barrels of Iranian oil a day.
We have Iran and Saudi Arabia fighting a proxy war in Yemen.

We have Mr Obama and Mr Putin fighting their private war in the Mideast.

Mr Putin is firmly on the side of Iran and Syria. What a great chess game. Mr Obama made the opening move to "open" Iran to investment; Mr Putin immediately countered by taking advantage of the opportunity to begin trading. Mr Obama said the "deal was done" in an earlier speech, and now it's just a matter of working out the details. Apparently Mr Putin has begun working out those details.

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

Regardless of how the wars turn out, some observations:

  • defense industry should do very, very well; Saudi has a lot of money to spend on arms
  • defense industry should do very, very well; Iran has pent-up demand; the Obama-Iran deal will help 
  • in the "old" days, the level of war-drum noise at this point would have raised oil prices to $150 range; with the current glut of oil, no one seems concerned
The Kennedys Are Going Skiing

Is it just me or has this been the best year for skiing across the US? California was an exception; had a miserable year, but Colorado and the northeast did very, very well. It continues. is reporting:
The calendar may say mid-April, but we have our eyes on a system that may produce significant snowfall for the Rocky Mountains, including the Denver metro area this week. 
The culprit is a sharp southward plunge of the jet stream which will drive into the Northwest Monday, then the northern Rockies and Great Basin Tuesday, bringing lowering snow levels to the Cascades, Bitterroots and Wasatch, not to mention high winds to the Great Basin. 
Winter storm watches have already been posted in the Wasatch of Utah and high wind watches and warnings have been posted from in parts of six states from Death Valley, California to Colorado's western slope, including the Salt Lake Valley.

Monday Morning And Even More Miscellaneous -- April 13, 2015

Data for wells coming off the confidential list over the weekend, today have been posted. The production profiles are interesting, note, for example, the production profile for this well at the link:
  • 25072, 1,449, Newfield, Sand Creek State 153-96-16-2H, Sand Creek, one section, not the production profile, 30 stages; 1.8 million lbs, t1/15; cum 34K 2/15;

Also of interest: wells placed on IA/SI status.

Oil Looking Good Again

I think this is a re-posting of an earlier story by Bloomberg:
Speculators increased bullish oil bets by the most in more than four years, wagering that the U.S. production boom is slowing. 
Hedge funds boosted net-long positions on West Texas Intermediate crude by 30 percent in the seven days ended April 7, the biggest jump since October 2010, U.S. Commodity Futures Trading Commission data show. Long bets rose to a nine-month high, while shorts tumbled 21 percent. 
U.S. crude output and inventories may peak this month amid a record drop in rigs exploring for oil, Goldman Sachs Group said. Refiners returning from seasonal maintenance will add about 500,000 barrels a day of demand by July, the Energy Information Administration forecast, helping ease the biggest glut in 85 years.

Random comment: based on the Saudi Arabia/OPEC numbers below, had the Keystone XL pipeline been approved, it's very likely the US would have gotten almost all oil, and maybe ALL oil, from the western hemisphere. Canada would have maximized production, filling the Keystone, and it's even possible, another "Keystone" would have been necessary.

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.

Netflix: my favorite story. See "the next big thing" on this blog. I'll link it later if I remember. Netflix is surging 4% on the opening, up over $18. Predicted.

Before market open: Reuters said market would dip at opening -- profit-taking after 3-day run. In fact, the market is already up nicely (it will pull back by 10:00 a.m.) and oil is up over 2%. Think Y-E-M-E-N.

US dollarBloomberg is reporting:
Sovereign and corporate borrowers outside America owe a record $9 trillion in the U.S. currency, much of which will need repaying in coming years.
AAPL is up almost a percent. The Apple Watch will do little, if anything, directly for Apple's bottom line, but the Apple Watch will do more for Apple (and already has done more for Apple) than folks realize. In advertising alone, the only technology company in the news for the past week has been Apple. I'm not even sure what Microsoft is selling any more these days. Apple's new MacBook is a direct competitor to the Microsoft Surface; it will take a year or so for the new MacBook to get any traction. It is too far ahead of its time.

Saudi Crude Oil Imports Into The US

The last time I posted this data was March 1, 2015. The January, 2015, data is out:

788,000 bbls/day.

From wiki:
Motiva Enterprises, LLC, is a 50–50 joint venture between Shell Oil Company and Saudi Refining.  
Motiva Enterprises owns and operates three oil refineries in the gulf coast region of the United States: a 600,000 bbl/d refinery in Port Arthur, Texas, a 235,000 bbl/d refinery in Convent, Louisiana, and a 240,000 bbl/d refinery in Norco, Louisiana. 
On May 25th, 2012, Motiva officially completed its expansion of the Port Arthur refinery to a capacity of 600,000 bbl/d (95,000 m3/d) making it the largest refinery in North America and the fifth largest in the world.
600 + 235 + 240 = 1,075,000 bopd for these three refineries.

Note: I often make simple arithmetic errors. If the above is correct, Saudi Arabia is now providing significantly less oil to its own refineries along the US Gulf Coast. 

US Crude Oil Imports

The graphic below is for the past six months, from August, 2014, through January, 2015.

Note these story lines:
  • imports from OPEC have dropped from 101 million bbls/month to 79 million
  • the African countries of Algeria and Angola have taken huge cuts
  • Nigeria made up for that African loss for one month; now back to its 'usual"
  • Saudi Arabia has maintained (which doesn't quite square with numbers above)
  • Ecuador is holding its own, though "volatile"
  • Venezuela, down a bit, but not as much as one might expect ("right type" of oil)
  • Non-OPEC has jumped; I assume mostly from Canada; some Ecuador, maybe Mexico

Monday, More Miscellaneous -- April 13, 2015; California -- Back To Coal?

I know very little about desalinization but my hunch is I will be learning a lot more about it in the not too distant future. Three things I do know about it: a) it's very, very expensive; b) it uses a lot of energy; and, c) folks are starting to do more than just talk about it.

From The New York Times:
Every time drought strikes California, the people of this state cannot help noticing the substantial reservoir of untapped water lapping at their shores — 187 quintillion gallons of it, more or less, shimmering so invitingly in the sun. 
Now, for the first time, a major California metropolis is on the verge of turning the Pacific Ocean into an everyday source of drinking water. A $1 billion desalination plant to supply booming San Diego County is under construction here and due to open as early as November, providing a major test of whether California cities will be able to resort to the ocean to solve their water woes. 
Across the Sun Belt, a technology once dismissed as too expensive and harmful to the environment is getting a second look. 
Texas, facing persistent dry conditions and a population influx, may build several ocean desalination plants. 
Florida has one operating already and may be forced to build others as a rising sea invades the state’s freshwater supplies. In California, small ocean desalination plants are up and running in a handful of towns. 
Plans are far along for a large plant in Huntington Beach that would supply water to populous Orange County. A mothballed plant in Santa Barbara may soon be reactivated. And more than a dozen communities along the California coast are studying the issue.
Then this:
The plant will use a huge amount of electricity, increasing the carbon dioxide emissions that cause global warming, which further strains water supplies. And local environmental groups, which fought the plant, fear a substantial impact on sea life.
There is only one source that can provide the electricity that will be needed.

It's a four-letter word that starts with "c" and rhymes with "foal."

EIA Blurb For Today

The EIA blurb:
Households in different regions of the United States have similar average combined spending on gasoline and public transit, but the composition of that spending varies significantly across regions. In 2013, the most recent year of data from the U.S. Bureau of Labor Statistics' Consumer Expenditure Survey (CES), the average household spent $3,148 annually on gasoline and public transit, with only about a $200 difference between geographic regions with the highest and lowest travel expenditures. --- EIA
Another way of saying this: New Yorkers and Bostonians get all the expense of transportation with none of the fun. New Yorkers and Bostonians in subways; Californians in SUVs in the fast lane.

The EIA blurbs in general, and this one specifically, seem to be sounding more and more like Chinese fortune cookies.

Monday, Miscellaneous -- April 13, 2015

Golf is back.

Jimmy Johnson wins.

Apple sells out of its Apple Watch in six hours; one million on-line orders placed. Many won't get their watches until May or June. Some will be waiting until July. And the watch hasn't even gone on sale yet; those were pre-orders. The watch goes on sale April 24th.



The lead story above the fold in today's WSJ: US widens role in Yemen conflict. The US and Saudi Arabia are at odds on how the fight should be fought. I doubt Saudi is taking much advice from President Obama. If anything, the Saudis are re-reading his "Arab Spring" speech he gave in Cairo some years ago.

News of Obama's fourth war (Iraq, Afghanistan, ISIS being one, two, and three) continues on page A6 and dominates the entire page of "World News." The first story: US moves to step Iran arms flow to Yemen. The second story on that page: Saudis deny fighting proxy war with Tehran. Every story on page A6 has to do with Yemen. The third story: Pakistan's decision to stay out of Yemen is causing a cleavage between the country (Pakistan) and its traditional allies in the Gulf, as the Yemen crisis begins to remake alliances across the Muslim world. And just a few months ago, Yemen was President Obama's poster child for Muslim countries that "go democratic."

Saudi Arabia is going to spend a lot of money defending itself. They can count on the US Navy to protect their sea lanes (or can they?) but they know they have to fight their own wars on the peninsula. Of course, while keeping the Houthi rebels hunkered down, Saudi Arabia will be putting together an Arab army (at Saudi's expense) to begin the ground offensive.

And that's the southern front. On the east, Iran; and, in the north SyriaIran (or is is IranSyria?).


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.

For Investors


From Seeking Alpha:
For a major E&P company, ConocoPhillips  has grown production substantially faster than its peers since the company's spin-off in 2011
Previously, management had a plan of 3%-5% overall production growth and 3%-5% margin growth between 2013 and 2015. Then crude oil prices halved and Conoco has had to rethink its strategy for the last year of its plan. 
On last week's annual analyst day presentation, Conoco unveiled a new three year plan which reflects the current reality of commodity prices, and builds on the operational successes of the past three years. Conoco's new 'three-year plan' involves several major bullet point goals: Increase cash flow margins from $22 per barrel (in late 2014) to $25 per barrel by 2017, achieve cash flow neutrality by 2017 assuming $75 Brent and $70 WTI and production growth of 2%-3% with a continuing shift toward liquids and away from gas. Late last year Conoco announced a new, much-reduced capital spending regimen of $11.5 billion, down from $16 billion in 2014. On last week's analyst day presentation, management reaffirmed that capital expenditure guidance would be in the new 'three-year plan.'
An excerpt from COP's analysts' day transcript regarding the Bakken was posted here.

The Map

Link here.

A reader asked me if I really thought the House of Saud might fall. The short answer: I don't think so.

Having said that, I have made some huge errors in my predictions on the blog, so I may be wrong here also. I don't think the House of Saud will fall (and it certainly won't fall any time soon), but a) nothing lasts forever; and, b) the House of Saud will have some huge new military expenses. In the past, they got away cheap with promised US protection. At one time Saudi Arabia's oil was part of America's national security; not so much any more. Not with the resurgence of the North American energy industry.

I can still connect the dots to seeing a fast-track Keystone XL. Not that such a fast-track is very likely, but I can connect the dots. This link on Motiva Enterprises is a huge dot.

Monday, April 13, 2015

Active rigs:

Active Rigs93189186208173

RBN Energy: five Marcellus / Utica midstream players.
MarkWest Energy Partners is clearly the big dog in the Marcellus/Utica, with by far the largest gas processing and fractionation capacity there. But several other significant players in the region--Blue Racer Midstream, Utica East Ohio Midstream, Williams Partners and Pennant Midstream among them—have also been developing the region’s midstream infrastructure, enabling producers to ramp up their output of natural gas and NGLs. Today we continue our review of NGL-related assets in the Upper Ohio River Valley with a look at five additional midstream companies in the hunt. 
Producer interest in the Marcellus in southwestern Pennsylvania and northern West Virginia and in the Utica in eastern Ohio has been rising quickly since 2011--and it’s expected to continue as more take-away capacity for natural gas and NGL comes online, offering producers access to markets as far away as Texas. In our series on the region’s NGL-related infrastructure, we’ve describe the region’s history and hydrocarbon potential generally (in Episode 1) and in more detail (Episode 2). 
Next, (in Episode 3) we discussed the eight major pipelines that move natural gas through and out of the region; considered the gas processing and fractionation assets of MarkWest (Episode 4 and Episode 5); and described the pipeline interconnections between MarkWest’s eight (and soon nine) gas/NGL complexes in the region—and then explained how the elements of MarkWest’s “machine” are designed to function efficiently, even in the event of NGL-takeaway disruptions (Episode 6). In our last blog in this series, we started our look at other providers of midstream services in the Marcellus/Utica by considering the assets of Blue Racer, a joint venture of Caiman Energy II and Dominion (Episode 7). This time, we look at the remaining players in the region and list their gas processing plants, fractionators, and NGL pipelines that link those facilities to the outside world.
In addition to its 49% stake in UEO (thanks to its February 2015 merger with Access Midstream), Williams Partners owns 100% of Appalachian Midstream, which operates (and owns between one-third and two-thirds of) 11 natural gas gathering systems in the Marcellus—some in the dry-gas part of the Marcellus in northeastern Pennsylvania and some in the wet-gas part in southwestern Pennsylvania and northern West Virginia. Appalachian Midstream also owns the gas processing plants and pipelines shown in the southeastern part of Figure #1 [at the linked article]. The company’s 700 MMcf/d of gas processing capacity is split between two sites in Marshall County, WV--500 MMcf/d at Fort Beeler and 200 MMcf/d at Oak Grove—that together can produce up to 87 Mb/d of mixed, y-grade NGLs (blue dots). Its fractionation assets include a 40 Mb/d de-ethanizer at Oak Grove (green dot); the residual mixed NGLs then is fractionated at Williams’ 42 Mb/d C3+ fractionator at Moundsville—also in Marshall County (orange dot). Ethane separated out at Oak Grove is delivered to market via Williams’ 50-mile, 12-inch-diameter Ohio Valley Ethane Pipeline (OEVP, green line) from Oak Grove to MarkWest’s NGL hub at Houston, PA (shown in black since it is not owned by UEO). From there, ethane can flow into Mariner East, Mariner West and/or ATEX. 
We should note that Williams Partners holds a 58% stake in Caiman II, which owns half of Blue Racer. In Episode 7 we covered how Blue Racer moves ethane from its Natrium complex to Oak Grove via a 15-mile (Blue Racer-owned) ethane-only pipeline, and that from there the ethane moves to Houston (PA) via Williams’ OEVP.

NOG press release: Northern Oil and Gas, Inc. today announced that its bank syndicate group reaffirmed and maintained the existing $550 million borrowing base under Northern's revolving credit facility during the semi-annual redetermination period.

Comment: this is in-line with earlier posts on "redeterminations."