Saving The Best For Last -- September 14, 2015

While returning from North Dakota, I ran into two couples -- one couple in Buffalo, South Dakota; and, one couple in Rapid City, South Dakota, a couple of days later -- who were on their way to North Dakota simply because they were completing their 50th state visit.

This evening, coincidentally, a reader sent me a link to this Wall Street Journal article:

FARGO, N.D.—During a stop at the visitors’ bureau here, Theresa Zelonis mentioned to an employee that she and her husband’s 6,400-mile road trip purposely included a few miles of North Dakota so she could tick off visiting her 50th state. The employee gasped.
“It was like bells and whistles went off!” she recalled.

The travel ambassador led Mrs. Zelonis, of Pennsylvania, to a desk, where she was presented with a T-shirt, magnet and certificate, all saying “Best for Last Club,” and emblazoned with a silhouette of North Dakota. She signed the guest book of other club members. The staff member took her photo for the bureau’s Facebook page.

One of America’s least-populated, most-rural states, North Dakota is also one of the least visited. A tourism brochure brags it has three times more cattle than residents; fittingly, the state’s official drink is milk. A prime attraction is the Theodore Roosevelt National Park, praised by one online travel site for being “sparse and empty.” Another is the wood chipper used to dispose of a body in “Fargo,” the 1996 movie about a kidnapping plot hatched by bumbling criminals.

According to an informal poll conducted by the All Fifty Club, an online list of Americans who have visited all 50 states, most members leave Alaska, Hawaii and North Dakota for last: Alaska and Hawaii, because they’re hard to reach; North Dakota, because, well, it’s North Dakota.

One of the two couples was only going as far as the south unit of Theodore Roosevelt National Park in the southwest corner of the state, and I'm not even sure the other couple was going that far. It sounded like if they got as far as the state line, or possibly Bowman, that might be as far as they will get, but they will be able to see they have visited all 50 states.

(President Obama has visited all 57 states, by the way.)

I've been to both Hawaii and Alaska, so it should be easy for me to complete all 50 states. It's possible I've been to all 50 states -- in my younger days I hitchhiked cross-country several times and ticked off a number of states that way. I'm trying to think; I do believe I have had to hit all 50 states. I've Amtrak'd from Boston to Texas; bused from Texas to Los Angeles; Amtrak'd up the coast and then across the northern tier all the way back to Boston. I've been to Dover (Delaware) and Maryland (courtesy of the Air Force) -- I think I've hit all the states. Never thought about it until now. While in Boston, all of New England. Hmmm...

Fourteen (14) New Permits; Number Of Active Rigs In North Dakota Ties Post-Boom Low; Whiting To Report A Big Well; BR With Another High-IP Well -- September 14, 2015

Active rigs (I track the number of active rigs here):

	9/14/2015	09/14/2014	09/14/2013	09/14/2012	09/14/2011
Active Rigs	68	199	178	193	201

Poll: will "we" drop into the "50's" with regard to number of active rigs in North Dakota?

Poll results: predicting July, 2015, ND crude oil production (I mistakenly forgot to add 1.2 million bopd and I assume many of those opting for 1.1 million bopd would have gone with 1.2 million, the best number):

• 1.1 million bopd: 65%
• 1.0 million bopd: 24%
• 0.9 million bopd: 12%
• 0.8 million bopd: 0%
• 0.75 million bopd: 0%

Wells coming off confidential list Tuesday:

• 29086, 1,607, Whiting, Cymbaluk Federal 41-15PH, Bell, 30 stages, 3.1 million lbs sand; on ESP almost immediately; t7/15; cum 73K 7/15;
• 29779, SI/NC, Abraxas, Sten-Rav 1H, North Fork, no production data,
• 30098, 1,362, Hess, BB-Ole Anderson-151-95-3130H-5, Blue Buttes, no production data,

Sure looks like the Bakken is shutting down. Not! Fourteen (14) new permits:

• Operators: XTO (6), MRO (3), Oasis (3), Petro-Hunt (2)
  Fields: Lost Bridge (Dunn), Murphy Creek (Dunn), Siverston (McKenzie), Charlson (McKenzie)
• Comments:

Triangle renewed two permits; Fidelity renewed one permit; and, American Eagle renewed one permit.

Two (2) producing wells completed:

• 29981, 2,352, BR, CCU Dakota 1-7-17MBH,  Corral Creek, t8/15; cum --
• 30502, 791, Hess, LK-A Qtr Cir-147-96-1807H-8, Big Gulch, t8/15; cum --

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9086, see above, Whiting, Cymbaluk Federal 41-15PH, Bell:

Date	Oil Runs	MCF Sold
7-2015	13542	18927
6-2015	17042	21869
5-2015	13198	15731
4-2015	18850	22811
3-2015	10282	10419

WMB Announces "Healthy" Dividend Increase -- September 14, 2015

This is not an investment site. Do not make any investment or financial decisions based on what you read here or what you think you may have read here.

WMB dividend increased to 64 cents; up significantly over previous and continues to the trend. Back in 2011, it was paying 10 cents.

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Airbus coming to the US? 

CNBC is reporting that Airbus is coming to Alabama. From a press release:

Airbus made history with the start of operations at its A320 Family jetliner final assembly line in Mobile, Alabama – officially called the Airbus U.S. Manufacturing Facility – which is the company’s first production site in America.

This game-changing facility commenced aircraft assembly in July 2015, with first deliveries scheduled to begin in 2016. The Airbus U.S. Manufacturing Facility is expected to produce between 40 and 50 aircraft per year by 2018 – building the A319, A320 and A321 versions from Airbus’ best-selling single-aisle family of jetliners. 

The $600-million, 53-acre facility at the Mobile Aeroplex at Brookley represents Airbus’ significant commitment to the U.S. – which is the largest market in the world for single-aisle aircraft. The vast majority of A320 Family jetliners produce in Mobile, Alabama will be delivered to North American customers. 

In addition, the Mobile A320 Family final assembly line builds on an already strong presence of Airbus and its Airbus Group parent company in this Gulf Coast city – which also includes an engineering centre at the Mobile Aeroplex at Brookley that employs more than 200 engineers and support staff, as well as the Airbus Group’s North American military customer services operation near the Mobile Regional Airport.

Don points out that the undeclared presidential candidate Joe Biden would call this a big f'n deal.

Gee, I wonder why? Let me count the ways:

• no French unions to deal with
• no US unions to deal with
• no French socialist Hollande to deal with
• closer to US customers
• really cheap energy
• did I mention, really cheap energy?
• really smart workforce that wants to work
• did I mention a really smart workforce that wants to work?
• does not have to deal with ISIS down the road 

It's my understanding Airbus is a French/German consortium. Getting state approval and union approval to do this speaks volumes. I hope the deal is truly a done deal. I do not know if Hollande has signed off on this. Operations are underway, but that doesn't mean Bernie Sanders or Hollande could still not get involved. Of course, the latter (Hollande) is busy welcoming 800,000 Syrians to Germany.  I wonder when Barack Obama is scheduled to be on television telling us how he swung this deal, that it what contingent on the Iran deal?

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Misplaced Priority List?

Every day I scan the LA Times on-line, mostly just the headlines because I don't have a subscription (but through google, one can read the stories, but I digress). As I was saying, every day, I scan the LA Times on-line, and today, more than ever, I get the feeling that all the attention on global warming climate change extreme weather whatever resulted in state of California completely missing more pressing needs. The things that caught my attention today: the crime rate in south Los Angeles (homicides, specifically) and the fires out of control north of San Francisco.

At least legislators have the bullet train to think about, to keep their minds off more pressing issues.

July, 2015, Director's Cut -- North Dakota Production Unchanged (Down 0.8%)

Comment: timely article sent to me by reader, received while this month's Director's Cup was being disseminated. CNNMoney is reporting:

American Power Group Corporation announced today that its Trident NGL Services Division has secured its second flare capture services relationship with one of the largest oil companies in the world whose identity has not been disclosed due to non-disclosure and competitive reasons.

APG's Trident Services Division will be up-fitting two of the customer's well sites with Trident's Modular Flare To Fuel™ Capture and Recovery System in the North Dakota Bakken oil and gas region.

Installation of both systems is scheduled to occur in the next thirty to sixty days allowing Trident to begin monetizing the captured flare by converting the gas to saleable Natural Gas Liquids (NGL).

APG recently announced a license agreement with Trident Resources, LLC for the exclusive worldwide right to commercialize Trident's proprietary NGL processing technology. APG purchased certain of Trident's operating assets including two existing mobile NGL processing systems and recently announced a commitment for the financing of two additional systems in response to strong demand from oil and gas operators looking for an effective solution to capture their flare on existing remote and stranded well sites.

An average remote or stranded well site producing one to two million cubic feet of flared gas per day has the capacity to produce several million gallons of NGL per year making this a multi-billion dollar regulatory-driven market.

What is the NGL market and where does APG's Trident NGL Services Division fit? When oil is extracted from shale, a mixture of hydrocarbon gases (methane, ethane, propane, butane, pentane and other heavy gases) reach the surface at each well site. These gases are either gathered in low-pressure pipelines for downstream NGL extraction by mid-stream processing companies or flared into the atmosphere when the gas-gathering infrastructure is too far away (remote well sites) or the pipeline is insufficient to accommodate the volumes of associated gas (stranded well sites).

These remote and stranded well sites are under increasing regulatory requirements to either capture the flared gas or significantly reduce oil output. APG's proprietary Trident NGL capture and recovery process is the emerging leader in capturing and converting a higher percent of the gases at these remote and stranded well sites with its mobile and modular design when compared to other competitive capture technologies that cannot meet the 85% capture regulation due on January 1, 2016. NGL's can be sold to a variety of end markets for heating, emulsifiers, or as a combined NGL liquid called Y Grade that can be sold to midstream companies who separate the liquids into their final commodities.

I track the "cuts" here. 

Disclaimer: this update is always done in haste; typographical and factual errors are likely. This is for my use only. If this is important to you, you should go to the source. 

Note: facts and opinions are interspersed in the note below. Do not make any investment or financial decisions based on what is posted below; there will be factual and typographical errors. If this information is important to you, go to the source. 

The July data is posted at this link: https://www.dmr.nd.gov/oilgas/directorscut/directorscut-2015-09-14.pdf

Important data points:

• Today, pricing: $30.25
• Bakken price in August: $29.52
• Fracklog: 914 (70 more than at end of June, previous reporting period)
• Completions: 119 (149 in May, 2015) -- more wells going to SI/NC status
• To maintain production near 1.2 million bopd: 110 - 120 completions needed each month
• Statewide flaring: 20% (an increase of 3%) 

Delta, crude oil production: 

• 1,211,328-1,201,920 = 9,408
• 9,408 / 1,211,328 = 0.8% decrease month-over-month

Oil:  

• July, 2015: 1,201,920  [My hunch at 9:08 a.m., September 14, 2015: 1,205,789]
• June, 2015: 1,211,328 (final)(second highest; highest was December, 2014)
• May, 2015: 1,202,615 (final)
• April, 2015: 1,169,045 (final)
• March, 2015: 1,190,502 (final); 1,190,582 bopd (preliminary)
• February, 2015: 1,178,082 bopd (revised, final); 1,177,094 (preliminary)
• January, 2015: 1,191,198 bopd (all time high was last month)
• December, 2014: revised, 1,227,483 bopd (preliminary - 1,227,344 bopd - preliminary, new all-time high)
• delta: see above

Producing wells:

• July, 2015: 12,940 (preliminary -- new all-time high)
• June, 2015: 12,868 (final revised -- new all-time high)
• May, 2015: 12,679 (final revised -- new all-time high)
• April, 2015: 12,545 (final revised -- new all-time high)
• March, 2015: 12,443 (final revised -- new all-time high)
• February, 2015: 12,199 (final revised -- new all-time high)
• January, 2015: 12,181 (preliminary -- new all-time high)
• December, 2014: 12,134 (preliminary, new all-time high)
• November, 2014: 11,951 (revised); 11,942 (preliminary, new all-time high)
• October, 2014: 11,892; revised 11,942 (preliminary, new all-time high)
• September, 2014: 11,758 (revised); 11,741 (preliminary; new all-time high)
• August, 2014: 11,565

Permitting: 

• August, 2015: 153
• July, 2015: 233
• June, 2015: 192
• May, 2015: 150
• April, 2015: 168
• March, 2015: 190
• February, 2015: 197
• January, 2015: 246
• December, 2014: 251
• November, 2014: 235
• October, 2014: 328
• September, 2014: 261
• August, 2014: 273
• All-time high was 370 in 10/2012
  

Pricing: 

• Today, 2015: $30.25
• August, 2015: $29.52
• July, 2015: $39.41
• June, 2015: 47.73
• May, 2015: $44.70
• April, 2015: $38.33; $36.25 (lowest since February, 2009, and January, 2015) (all-time high was $136.29 7/3/2008)
• March, 2015: $31.47
• February, 2015: $34.11
• January, 2015: $31.41
• December, 2014: $40.74
• November, 2014: $60.61
• October, 2014: $68.94
• Sept, 2014: $74.85
• August, 2014: $78.46

Rig count:

• Today:  69 - lowest since November, 2009, when it was 63 (all time high was 218 on 5/29/2012)
• August: 74
• July: 73
• June: 78
• May: 83
• April: 91 (lowest since January 2010)
• March: 108
• February: 133
• January: 160
• December, 2014: 181
• November, 2014: 188
• October, 2014: 191
• Sept, 2014: 193
• August, 2014: 193
• July, 2014:  192

Director's comments:  [see source]

The number of well completions rose sharply from 116 (final) in May to 149 (preliminary) in June as a large number of NC status wells reached the 1-year deadline for completion or TA approval.

Drilling rig count: 

• rig count dropped 5 this month (August)
• dropped 5 from June to July
• dropped 5 from May to June
• dropped 8 from April to May
• dropped 17 from March to April 8
• dropped 25 February to March
• dropped 27 from January to February
• dropped 7 from November to December
• dropped 21 from December to January
• dropped 23 from January to date of previous month's Director's Cut

Rig utilization: [see source]

• no change
• 20,000+ feet rigs: 45% 
• shallow well rigs: 25% 

Well completions: 

• July: 119 (preliminary)
• June: 149 (final)
• May: 116 (final)
• April: 102 (final -- astounding drop)
• March: an astounding 194 (final)
• February: 42
• January: 63
• December: 173 (preliminary)
• November: 48

Weather: 

• one significant precipitation event in the Dickinson area
• 12 days with wind speeds in excess of 35 mph (too high for completion work)
• no days with temperatures below -10F

Wells waiting to be completed:  

• At end of July, an estimated 914 wells waiting to be completed, 70 more than at end of June
• At end of June, an estimated 844 wells waiting to be completed
• At end of May, an estimated 925 wells were waiting to be completed, no change
• At end of April, an estimated 925 wells were waiting to be completed, an increase of 45
• At end of March, an estimated 880 wells were waiting to be completed, a decrease of 20
• At end of February, an estimated 900 wells waiting to be completed, an increase of 75
• March, 2015, Director's Cut -- 825 wells -- an increase of 75-- January data
• Previous Director's Cut -- 750, a decrease of 25
• Red Queen: 110 - 120 completions per month to maintain 1.2 million bopd

Flaring: 

• capture target, current: 80% -- was 85% last month
• capture target, after October, 2016: 90%
• flaring today: 20%, up 3%; statewide capture 80%
• finally, the Tioga gas plant was down slightly to 88% of capacity (90% last month; 93% previous to that)
• expansion of gas gathering from south of Lake Sakakawea is still delayed; the project was approved, but it was approved too late for the 2015 construction season, resulting in a one-year delay.

Gas capture statistics:  

• statewide: 80% (October 2014 target was 74%; CY 2015 capture target is 77%)
• FBIR Bakken: 81%
• NOTE: the daily volume of gas flared from May to June was up just 1.6 MMcfd; last month the volume of flaring increased 30  MMCFD (previous month increased 23.5 MMCFD (a reversal from last month when flaring had decreased month-over-month)
• NOTE: previously announced -- ONEOK announced plans to hook up 700 wells in the Bakken (natural gas hook-ups)

Fracking policies/regulations: (see source linked above; way too much to post)

What Will Be July, 2015, North Dakota Crude Oil Production? September 14, 2015

What will be the July, 2015, North Dakota crude oil production? Above or below 1 million bopd?

Active rigs:

	9/14/2015	09/14/2014	09/14/2013	09/14/2012	09/14/2011
Active Rigs	69	199	178	193	201

RBN Energy: domestic propane production growth by region.

Tweeting Now; Other News -- September 14, 2015; Apple On Track To Set New iPhone Launch Record

Tweeting now:

• Iraq allocates some 2 mil b/d, more than 50% of Oct  crude oil exports, to pay back its international oil company contractors
• OPEC raises 2015 global oil demand growth forecast by 84,000 b/d to 1.46 mil b/d; trims 2016 estimate by 50,000 b/d to 1.29 mil b/d
• OPEC says 'all eyes are on how quickly US production falls,' with 2016 oil supply growth forecast at 220,000 b/d, down 100,000 b/d
• Gazprom raises estimate of Europe-bound natural gas exports to 158 Bcm

I will probably be late posting the NDIC Director's Cut when it comes out later today. I'm traveling. Beautiful day in the mid-section of the US. Landscape ruined by industrial farm outside Hays, Kansas, along the interstate.

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Apple Page

Apple on track to have huge iPhone launch.

Apple has informed the media that iPhone 6s and iPhone 6s Plus pre-orders are "on pace to beat" last year's record-breaking 10 million iPhone 6 and iPhone 6 Plus pre-orders sold on launch weekend in September 2014.

iPhone 6s and iPhone 6s Plus pre-orders started on Saturday at 12:01 AM Pacific. While most iPhone 6s Plus and Rose Gold models are now shipping in 2-3 weeks or later in the U.S., many iPhone 6s models remain available for delivery on September 25.

Story at Reuters also.

By the way, the amount of "storage" in the new iPhone has appeared to double. Apple does not release that data (but it is immediately reported by "everyone" once the first iPhone ships. Apple does not include that "kind of" data because they don't want folks to start thinking of the iPhone as a computer. It's a cell phone. Not a computer. Geesh.

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Most Exciting NFL Game On Opening Day?

Dallas edging by New York Giants. I listened to this game on the radio while driving through Colorado. Absolutely incredible. It must have been an amazing television spectacle.  Tony Romo ... wow?

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Global Warming

Climate Change

Extreme Weather

Whatever

Weather.com is reporting an incredibly quiet year following an incredibly quiet decade:

Despite being in the season's peak, it is not unusual at all to have one or multiple September days without a named storm active in the Atlantic basin. That happens most every year. [You wouldn't know that listening to Tom Steyer or Barack Obama.]

What's impressive is how the entire Northern Hemisphere has taken a breather at the same time, in mid-September. [Oh, really?]

This is the first time a September 12 lacked a single tropical storm, hurricane or typhoon in the Northern Hemisphere since 1977. [Mark that date, September 12, 2015.]

It was the first time since July 29 the hemisphere had taken a tropical cyclone break. In that time, there had been 18 tropical cyclones combined in the Atlantic and Pacific basins. [Wow, a tropical cyclone break. Tell that to the Japanese who have a huge flood on their hands due to tropical storms.]

It was the first time since two days before the summer solstice -- June 19 -- there were no areas to watch, invests, or named storms in the western, central or eastern Pacific. [An opportunity to catch up on federal paperwork.]

Since that time, there have been a whopping 24 named storms of at least tropical storm strength in the Pacific, including 10 typhoons or hurricanes reaching at least Category 4 intensity. [Oh, back to normal.]

For the first time in awhile, Hawaii wasn't threatened by a tropical storm this week. [In awhile.]

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So, Russian Tanks And Troops In Syria

Filling The Super-Power Vacuum 

Fox News is reporting.

Russia's military build-up in Syria has grown to include the shipment of a half-dozen highly sophisticated battle tanks -- and more troops -- a defense official told Fox News, in what the source called the "first clear sign of offensive weapons arriving in Syria."

 
The Pentagon has now tracked a total of 15 Russian Antonov-124 Condor flights into Syria, reflecting a steady stream of military cargo into Syria. According to the latest intelligence, this also includes the arrival of two more Russian cargo ships, containing the tanks. 

Up to this point, the official said, the Russian cargo and weapons that have been delivered to Syria could be viewed as defensive in nature. The arrival of tanks cannot be viewed this way.

Check and checkmate. 'Cause you know Obama isn't going to send tanks and troops back into the Mideast. Been there, done that. Got the t-shirt.

Small Airports Can't Hide High Costs Of Intermittent Energy -- September 14, 2015

The other day I mentioned putting in solar energy at airports "worked" because one could "hide" the costs inside the overall operating budget for the airport, and increasing landing fees to pay for expensive intermittent energy.

It looks like I was right on target. Smaller airports with a much smaller operating budget can't hide the high cost of intermittent energy as evidenced by this report out of Milwaukee, Wisconsin:

Construction of a proposed 5-acre solar energy farm at Mitchell International Airport would not be a good investment for the county or the airport, a consultant concludes in a report to the Milwaukee County Board.

The cost of building an array of solar panels needed to generate one megawatt of power is estimated at $6 million.

Although using that much solar power would reduce airport electricity purchases from We Energies by $80,000 a year, it could take as long as 75 years to pay back or recover the county's initial investment, according to the consultant's report.

The report suggests a smaller publicly owned solar array might be financially feasible if enough grant funds are available to significantly reduce costs.

Look at that: a megawatt of intermittent (solar) power is estimated at $6 million.

From an earlier post:

From an August 25, 2014, post, this is 30-second sound bite for "cost of renewable megawatt":

• Solar: $3 million / MW
• Wind: $2.5 million / MW
• Natural gas: $865,000 / MW