Blame Game: California Refiners Blame Others For High Gasoline Prices; From Denver, The Kennedy Clan Can Head To Cheyenne -- December 16, 2016

Updates

December 17, 2015: Wow! After the Kennedy clan leaves Denver, and then after departing Cheyenne, they can complete their western Ski Swing by heading up to Mount Baker outside of Seattle, WA. Tweeting now, these two tweets:

• Mt. Baker snow depth 80". Same time last year, it was 6". Could be triple digit by the weekend.  
• If models are correct, nearly every western WA mountain snowfall reporting location could have over 100% of normal snowfall by weekend.

Original Post 

The blame game:  Oil refiners blame California regulations, import issues and refinery closure for high gas prices. The Los Angeles Times is reporting:

California's stubbornly high gasoline prices in 2015 resulted from state regulations, trouble with imports and an outage at a major refinery.

Speaking to the state Petroleum Market Advisory Committee for the first time since expensive California gasoline brought huge profits to oil refineries this year, the Western States Petroleum Assn. said the unusually large gap between the state's average price for a gallon of regular gas and the national average involved matters out of the oil refinery industry's control.

Imports not sufficient:

No tankers were available in the Gulf Coast to bring fuel to California. Better deals were available to suppliers such as India, as global demand for gasoline this year has soared.

Regulations:

The average gas prices in California typically runs higher than the average for the rest of the nation because of the unique blend of environmentally friendly gas as well as state taxes and fees.

But this year, the gap was unusually wide, with the state average as much as 75 cents a gallon more than the national average. In the Los Angeles area, the gap was even greater — as much as $1.50 higher.

The refinery outage:

Blame for much of the disparity this year fell on the outage at Exxon Mobil's Torrance refinery. Exxon reduced output at the facility to less than 20% after an explosion in February destroyed a pollution control system.

Normally, Torrance accounts for 10% of the state's refined capacity and 20% of the capacity in Southern California.

Oil industry experts thought the plant would return to service by July, even if only with a temporary fix. Then it was expected that perhaps by year's end, Exxon would increase production.

Neither happened. And now the plant isn't expected to return to full capacity until February, just in time for Exxon to sell the facility to contracted buyer PBF Energy, a Parsippany, NJ-based firm.

But even as inventories in California have increased from summer lows, gas prices in the L.A. region and across the state remain out of step with the rest of the country.

Read the rest of the story at the link.  

*******************************

Usually It's Just Hot Air, But ... 

An Algore Cold Front Is Moving In From The West

Breaking news: Cheyenne, WY, broke 123-year-old snowfall record with 6.7 inches; old record was 3.3 inches in 1892.

After Denver, the Kennedy clan can head for Cheyenne. Algore is probably already there testing out his new SUV.

But look at that in Cheyenne. Again, it was not simply beating the record by a tenth of an inch, but the old record was absolutely crushed. More than twice as much snow fell as the previous record.

From I Hate The Media, back in 2010:

The pathetically unprophetic Robert F. Kennedy, Jr. wrote a column last year in which he bemoaned global warming and suggested that children of the future might never see snow again.

Meanwhile out in southern California:

National Weather Service reports record low temperature of 40 degrees set at Los Angeles airport, tying record set in 1971.

Wasn't there a global warming conference or something in Paris or Vienna or Bowman just last week?

About That NDIC Spreadsheet Error -- Maybe Not So Fast -- December 16, 2015

This post is done somewhat tongue-in-cheek.

Earlier today there was a story that the NDIC recently discovered an error in their "master" spreadsheet. The spreadsheet had calculated that the Fort Berthold Reservation accounted for "30%" of all oil produced by the Bakken in North Dakota. In fact that was an error. Corrected, the reservation apparently accounts for 17% of all oil produced by the Bakken in North Dakota. The story is at The Dickinson Press.

Among the many prolific oil fields in the reservation are Clarks Creek oil field and the Antelope oil field.

EOG's Hawkeye wells in Clarks Creek and the Antelope oil fields have, pretty much, all surpassed the 500,000 bbls of oil (cumulative) of the Hawkeye wells that have been drilled. It might be hard to find a "family" of wells that have produced so much.

Tomorrow, we're going to see what EOG's Riverview wells are capable of producing in these two oil fields. (Riverview wells in Antelope oil field; Riverview wells in Clarks Creek oil field.)

Based on the production that is now being produced in these two fields in the reservation and the severe cut-back in oil production throughout much of the rest of the Bakken (due to the slump in oil prices), it may turn out that the reservation in the not too distant future does account for 30% of all Bakken oil produced in North Dakota.

Now that would be "funny."

*************************************

A Note to the Granddaughters

That reminds me of a story. Many, many years ago, maybe 20, 25 years ago, now, I forget. My brother-in-law worked in a grocery store out in California, Ralph's to be precise. One of his responsibilities was to order bottled water that was sold by that particular Ralph's. I don't know how he did it, but one day he made a significant error, and ordered on the magnitude of 10x more bottled water than what was usually ordered, 10x more than necessary.

When the pallets and pallets of bottled water arrived, the error was considered so "bad," that despite years of good service, it appeared he might be fired.

That evening, overnight, a severe earthquake hit southern California. The one thing everyone needed that next morning was lots of bottled water.

Overnight, my brother-in-law went from being the village idiot to being a local hero.

Five (5) New Permits -- North Dakota, December 16, 2015; EOG To Report Huge Well Thursday -- 90,000 Bbls In One Month; 250K In < 5 Full Months

For the archives: NDIC accounting error overstated the reservation's contribution to total North Dakota production. The error goes back several years; the NDIC noted it in a footnote.

Wells coming off the confidential list Thursday:

• 30286, 1,974, EOG, Riverview 102-32H, Antelope, 23 stages, 12.8 million lbs, t6/15; cum 248K 10/15;
• 30369, SI/NC, Petro-Hunt, Thompson 153-95-8D-6-3H, Charlson, no production data,
• 31144, SI/NC, XTO, Ryan 14X-9A, Siverston, no production data,
• 31243, SI/NC, SM Energy, Smokey 14B-9HN, West Ambrose, no production,

*****************************************

30286, see above, EOG, Riverview 102-32H, Antelope, t - pending; cum 247K 10/15;

Date	Oil Runs	MCF Sold
10-2015	39182	53058
9-2015	45278	56321
8-2015	39590	10574
7-2015	87531	0
6-2015	35152	0

EOG will rock you!

We Will Rock You, Queen

****************************

Five (5) new permits --

• Operators: CLR (3), Whiting (2)
• Fields: Alkali Creek (Mountrail), Bell (Stark)
• Comments: 

HRC renewed four permits, all Fort Berthold permits, in section 7-152-93.

Four (4) producing wells were completed:

• 30068, 313, SM Energy, Helen 1B-26HN, West Ambrose, t12/15; cum --
• 30067, 298, SM Energy, Gertrude 1-26HN, West Ambrose, t12/15; cum --
• 30065, 401, SM Energy, Bud 1-26HS, West Ambrose, t12/15; cum --
• 30163, 989, Hess, AN-Prosser-152-95-1102H-6, Sanish, t11/15; cum --

Strike Oil's Artz well (#17606) was abandoned.

How About 90,000 Bbls In One Month In A Short Lateral, 320-Acre Spacing, Antelope Oil Field, The Bakken, North Dakota -- December 16, 2015

Note: I track the EOG Riverview wells in the Antelope oil field at this post. It is confusing because there are also EOG Riverview wells in Clarks Creek, just to the west. I track those wells here, as well as the Antelope oil field Riverview wells.

Updates

March 7, 2017: a well of interest.

Later, 7:19 p.m. Central Time: see first comment below.

On slide 10 of EOG's 3Qtr presentation, they graphically depict the 4,000+ micro seismic events (fractures) per 1,000' that occur with these high density fracs. This is almost a tenfold increase from frac jobs of just a few years ago. 

What is more significant, however, is that they can contain the frac radius fairly close to the wellbore, thus enabling the placement of far more laterals per DSU.

EOG increased their estimated recovery Bakken wide as a consequence of the Riverview's output. 

Other operators will be sure to follow. 

This is the graphic the reader refers to:

Original Post

 

Hold on to your hat. I can't wait to see the frack data on this well; it should be available tomorrow.

Remember: this is a short lateral. The spacing unit: 320 acres according to the permit application.

Spud date: 3/6/15
Cease drilling: 3/20/15

Total depth: 15,564 feet
Total vertical depth: 10,523 feet

Note: almost 90,000 bbls in one month -- rounding up......

We talked about this well several months ago. See this post. Also here. And in a meandering note.

At the links, note the location of this well, and its relationship to Clarks Creek. 

By the way, this is another good example of a well being on the confidential list, then coming off the confidential list and going to SI/NC list, and then going back on confidential list before being fracked. Some years ago, T----- stated that wells don't come on and off and then back on the confidential list.

30286, 1,974, EOG, Riverview 102-32H, Antelope, 23 stages, 12.8 million lbs in a short lateral:

Monthly production data:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
SANISH	1-2017	31	10612	10569	5452	40777	35662	1298
SANISH	12-2016	31	11111	11195	6329	39017	34624	576
SANISH	11-2016	23	7861	7952	5220	24272	20841	671
SANISH	10-2016	27	8043	8359	4823	41155	33927	3914
SANISH	9-2016	30	9652	9189	5461	47459	43710	55
SANISH	8-2016	31	10869	10872	5701	49787	45956	14
SANISH	7-2016	31	11733	11779	5967	50360	46226	317
SANISH	6-2016	30	12463	12419	6193	50799	45306	1891
SANISH	5-2016	31	14855	14878	6857	57395	46190	7388
SANISH	4-2016	30	16350	16456	6965	58878	53689	1376
SANISH	3-2016	31	19902	19715	7669	70289	63240	2229
SANISH	2-2016	29	22669	22750	7780	69119	56213	9381
SANISH	1-2016	31	19102	19750	6541	22936	16813	2306
SANISH	12-2015	27	20327	19712	7534	44279	0	41153
SANISH	11-2015	22	23234	24173	7765	67426	0	64716
SANISH	10-2015	31	39211	39182	10746	82984	53058	26345
SANISH	9-2015	30	45634	45278	11980	81474	56321	21521
SANISH	8-2015	23	39587	39590	11087	81021	10574	67872
SANISH	7-2015	31	86924	87533	22132	181681	0	177874
SANISH	6-2015	22	36619	35152	11454	62522	0	59880

It's going to be interesting to see the frack/completion data tomorrow.

From FracFocus (link here): 

• it was fracked between 5/10/15 and 6/14/15 (inclusive)
• total volume water: 6,437,764 gallons = 53,725,744 pounds of water or about 54 million lbs of water
• by weight, the water + sand: 80.64% was water; 19.23% was sand

Working backwards, I get about 12 million lbs of sand. The most sand I recall used by EOG for a frack was 14 million lbs, although deep in the recesses of my mind, I vaguely recall there might have been a 19-million-lb frack. Ah, yes, it was 19 million lbs; here are some "monster wells" with upwards of 19 million lbs.

By the way look at the halo effect on the earlier well on the same pad. The names of these wells suggest the first well (#19247) is a middle Bakken well, and the newer well (#30286) is a Three Forks well:

• 19247, 1,692, EOG, Riverview 01-32H, Antelope, off-line much of 2015, short lateral, 320-acre spacing; 15 stages, 9.2 million lbs; t11/10; cum 207K 10/15;  

The halo effect may not be much, but there was a slight increase in the production (although, again, it could have been due to other factors than the fracking of neighboring well):

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
SANISH	10-2015	31	2360	2276	786	4992	0	3841
SANISH	9-2015	30	2523	2431	629	5126	0	4020
SANISH	8-2015	31	3029	3047	607	5421	0	4270
SANISH	7-2015	20	2869	2589	687	4098	0	3366
SANISH	6-2015	0	0	0	0	0	0	0
SANISH	5-2015	0	0	0	0	0	0	0
SANISH	4-2015	0	0	0	0	0	0	0
SANISH	3-2015	0	0	0	0	0	0	0
SANISH	2-2015	2	114	784	117	235	0	170
SANISH	1-2015	31	1982	2113	384	4496	0	3348
SANISH	12-2014	31	1649	1828	440	3524	73	2303
SANISH	11-2014	30	1851	1836	487	3984	1134	1736
SANISH	10-2014	31	2110	1827	692	5783	641	3991
SANISH	9-2014	30	1752	1811	286	4925	18	3816
SANISH	8-2014	31	1944	2188	424	4309	315	3839
SANISH	7-2014	31	1921	1720	429	4244	693	340

Saudi Expanding As A Refiner -- December 16, 2015

This is really a cool story and helps explain why the US continues to import so much Saudi Arabian oil. Bloomberg is reporting:

Taking a controlling interest last year in South Korea’s third-largest refinery highlights the shifting dynamics of the oil business. With crude prices down by more than half in the past two years, the Saudis and other oil-rich countries are fighting to lock in customers. Asia, which now accounts for 70 percent of Saudi oil exports, is the primary battleground.

For Saudi Aramco, as the company is widely known, that means purchasing stakes in refineries, with contracts guaranteeing most of the oil will come from the kingdom. Aramco has invested in three processing facilities in Asia. As Iran prepares to boost its own exports, the Saudis are on the cusp of a dramatic increase in its commitment to the region, eyeing billions of dollars of projects in countries from Indonesia to Vietnam.
Owning refineries in Asia is “part of a long-term strategy to consolidate” the Saudi market share in a key region, said Mustafa Ansari, an analyst at the Arab Petroleum Investment Corp., a state-controlled development bank in Dammam, the city at the heart of Saudi oil country.

The Saudis pursued a similar path in the U.S. three decades ago to lock in sales as crude prices tumbled, buying into three oil-processing facilities in Texas and Louisiana since 1988. The strategy worked: Motiva Enterprises LLC, the U.S. refiner half-owned by Aramco, imported 65 million barrels of Saudi oil in the first eight months of 2015 -- more than triple what ExxonMobil Corp. got from the kingdom in that time, U.S. government data show.

More:

The push into Asia comes at a pivotal moment in Saudi Arabia. With oil revenue falling after crude slumped 34 percent this year, the kingdom is tightening its belt just as a new king ventures away from the kingdom’s traditionally conservative diplomacy. The International Monetary Fund predicts a budget deficit exceeding 20 percent of economic output this year. 

At Aramco, meanwhile, recently appointed Chief Executive Officer Amin Nasser is overseeing a plan to make the world’s biggest oil company a more integrated operation. Long focused on producing crude, Aramco plans to almost double its refining capacity by 2025 to 10 million barrels a day, equivalent to its current output of oil. That would put Aramco ahead of ExxonMobil as the world’s largest refiner.

Much, much more at the link.

John Kemp's Energy Tweets -- US Crude Oil Imports Surged For The Second Consecutive Week; Highest So Far This Year -- December 16, 2015

Some interesting energy tweets from John Kemp today including the first one:

• US crude oil imports surged for the second week running to 8.3 million b/d, the highest so far this year, at 8.3 million bopd: full story here -- a must read; 
• US refiners processed a seasonal record 16.6 million b/d last week up by +300,000 b/d from 2014
• US gasoline consumption averaged 9.2 million b/d in last 4 weeks, an increase of just +61,000 b/d compared with 2014
• US gasoline stocks adjusted for consumption are exactly with 2014 and long run average:
• US crude oil stocks rose +4.8 million bbl last week and now almost +111 million above prior year level (the graph is staggering)
• US total crude and product stocks rose +5.0 million bbl last wk reversing adecline of -3.6 million bbl the prior wk (the graph is staggering)

With regard to the US economy as a whole, the "gasoline consumption" data point above is most concerning; this does not support an expanding economy.

Imports surged, no doubt, because the US needs heavy oil. Refiners (which are optimized for heavy oil in the US) are processing record levels of crude oil. If US gasoline consumption is barely more today than it was a year ago, where is it going? Overseas.

This might be an interesting graph to come back to a year from now (assuming the US is exporting WTI):

Also, from John Kemp:

The graph is all I need to know about oil prices.

I think the graph would be more useful if he broke it into "larger chunks." For example: $0 - $19.99; $20 - $49.99; $50 - $69.99; $70 - $99.99; >$100.

$0 - $19.99: 65 weeks
$20 - $49.99: 34 weeks
$50 - $69.99: 14 weeks
$70 - $99.99:  14 weeks
> $100: 12 weeks
... and even then, I doubt the data is very meaningful. But it certainly looks like the price of oil above $40 or $50 is an outlier.

December, 2015, Hearing Dockets -- December 16, 2015: One New Operator

Wednesday, December 16, 2015

24687, Enerplus, Antelope-Sanish, establish a 640-acre unit, 4 wells, McKenzie County
24688, HRC, Antelope-Sanish, reduce setbacks, McKenzie
24689, HRC, McGregory Buttes-Bakken, reduce setbacks, Dunn
24690, Hess, Beaver Lodge-Bakken, establish an overlapping 2560-acre unit, 1 well, Williams
24691, Whiting, Moccasin Creek-Bakken, amend, establish a 1920-acre unit, 1 well; establish a 1920-acre unit, two wells, Dunn
24692, Prairie Hills Oil and Gas, Grover-Madison, pooling, Renville
24693, Hess, pooling
24694, Whiting, pooling
24695, Whiting, pooling
24696, Whiting, pooling
24697, QEP, commingling
24698, QEP, pooling
24699, QEP, pooling
24700, QEP, pooling
24701, MRO, Lost Bridge-Bakken, 4 hz wells on a laydown 640-acre unit, Dunn County
24702, BR, pooling
24703, OXY USA, St Anthony-Bakken, pooling, Dunn

Thursday, December 17, 2015

24704, Newfield, Hanks-Bakken, redefine field limits, Williams
24705, Newfield, Bar Butte-Bakken, redefine field limits, Williams
24706, Sinclair, Robert Peterson well, temporary spacing, McKenzie
24707, Sinclair, Robinson Lake-Bakken, specific well location, Mountrail
24708, commission to review abandoned status of C12 Energy #8 Dickinson-Heath-Sand-Unit, Dickinson Field, Stark County
24709, commission to review abandoned status of Citation #5 Haakenstad,  Haram Field, Bottineau County
24710,  commission to review abandoned status of Citation #3 Haakenstad,  Haram Field, Bottineau County
24711, Statoil, Stony Creek and Avoca-Bakken, reduce setbacks, Williams
24712, WPX, Mandaree-Bakken, establish an overlapping 2560-acre unit, 1 well, Dunn County
24713, Vast Operations, Crosby-Madison, establish two 640-acre units; Divide County
24714, XTO, Lost Bridge-Bakken, establish an overlapping 2560-acre unit, 1 well, Dunn
24715, XTO, Bear Creek-Bakken, establish an overlapping 1280-acre unit; 2 wells, Dunn
24716, EOG, Stanley and/or Parshall-Bakken, establish i) an overlapping 1280-acre unit; ii) an overlapping 1920-acre unit, multiple wells; Mountrail
24717, CLR, pooling
24718, CLR, commingling
24719, Newfield, pooling
24720, XTO, pooling
24721, XTO, pooling
24722, XTO, pooling
24723, XTO, pooling
24724, XTO, pooling
24725, XTO, pooling
24726, XTO, pooling
24727, XTO, pooling
24728, Emerald Oil, Hay Draw-Bakken, 7 wells on each of 3 1280-acre units, McKenzie
24729, Sinclair, risk penalty legalese, Little Knife-Bakken, Dunn
24730, Sinclair, risk penalty legalese, Little Knife-Bakken, Dunn
24731, Sinclair, risk penalty legalese, Lone Butte-Bakken, Dunn
24732, Sinclair, risk penalty legalese, Lone Butte-Bakken, Dunn

January, 2016, Hearing Dockets -- First Notice -- December 16, 2015

The January, 2016, hearing dockets.

I track the dockets here. 

Wednesday, January 13, 2015

The Commission will review the development plan within the Corral Creek-Bakken Unit, Dunn County, North Dakota, pursuant to Order No. 18849.

Wednesday, January 20, 2016

24734, Whiting, Estes-Bakken, proper spacing, McKenzie
24735, Whiting, Oasis, Estes-Bakken, redefine field limits, McKenzie
24735, Whiting, Oasis, Harding-Bakken, redefine field limits, McKenzie
24736, Whiting, Hay Creek-Bakken, redefine field limits, McKenzie
24737, Whiting, Nelson Bridge-Bakken, redefine field limits, McKenzie
24738, MRO, Antelope-Sanish, waive rules for a single well, McKenzie
24739, SM Energy, Whiteaker and/or Plumer-Bakken, i) terminate two 640-acre units; establish a 120-acre unit; 7 wells; ii) terminate two 640-acre units, establish a 1280-acre unit, 7 wells, Divide
24740, Petro Harvester, Upper Des Lacs-Madison, extend boundaries, establish one 1280-acre unit; 5 wells; or alternatively, establish two 640-acre units and two wells on each; Burke
24741, Petro Harvester, Portal-Madison, establish one 800-acre unit, and one 1280-acre unit, 5 wells on each; or alternatively establish two 640-acre units and 2 wells on each; Burke
24742, Petro Harvester, Flaxton-Madison, establish one 800-acre unit and one 1280-acre unit, 5 wells each; or alternatively establish two 400-acre units and two 640-acre units and 2 wells on each; Burke
24743, Petro Harvester, Stony Run and/or the Woburn-Madison, extend the boundaries, establish one 1280-acre unit, 5 wells; or alternatively establish two 640-acre units and 2 wells on each; Burke
24744, Missouri River Resources, McGregory Buttes-Bakken, 4 wells on a 320-acre unit; Dunn; one well on an overlapping 640-acre unit; Dunn
24745, Hess, commingling
24746, Hess, commingling
24747, Hess, pooling
24748, SM Energy, pooling
24749, Petro-Hunt, pooling
24750, Oasis, pooling
24751, Oasis, pooling
24752, Oasis, pooling
24753, Oasis, pooling
24754, Oasis, pooling
24755, HRC, pooling
24756, HRC, pooling
24757, HRC, pooling
24758, HRC, pooling
24759, HRC, pooling
24760, HRC, pooling
24761, HRC, pooling
24762, BR, pooling
24763, BR, pooling
24764, BR, pooling
24765, BR, pooling
24766, BR, pooling
24767, BR, pooling
24768, BR, pooling
24769, QEP, Spotted Horn-Bakken, amend, 3 wells on an overlapping 2560-acre unit; McKenzie
24770, MRO, pooling

Thursday, January 21, 2016

24771, Resonance Exploration, Westhope-Spearfish/Madison, amen, i) create a 160-acre unit solely for a specific well; ii) create three 320-acre unit for multiple horizontal wells; iii) multiple wells on ann existing 320-acre unit; Bottineau
24772, CLR, Banks-Bakken, reduce setbacks, McKenzie
24773, CLR, Elm Tree-Bakken, 1) amend Order # 26915 to terminate a 2560-acre unit; ii) create a 1280-acre unit; iii) create a 1280-acre unit; reduce setbacks; iv) 14 wells on each proposed 1280-acre unit; v) eliminate the 1220 setback rule for the first well drilled; McKenzie, Mountrail
24774, CLR, Hardscrabble-Bakken, redefine field limits, McKenzie, Williams
24775, Newfield, pooling
24776, EOG, pooling
24777, EOG, pooling
24778, EOG, pooling
24779, EOG, pooling
24780, EOG, pooling
24781, EOG, pooling
24782, EOG, pooling
24783, EOG, pooling
24784, EOG, pooling
24785, EOG, pooling
24786, EOG, pooling
24787, EOG, pooling
24788, EOG, pooling
24789, EOG, pooling
24790, EOG, pooling
24791, CLR, pooling
24792, CLR, pooling
24793, CLR, pooling
24794, CLR, pooling
24795, CLR, pooling
24796, CLR, Truax-Bakken, 14 wells on an existing 1280-acre unit, McKenzie, Williams
24797, XTO, pooling
24798, XTO, pooling
24799, XTO, risk penalty legalese
24800, XTO, risk penalty legalese
24801, XTO, risk penalty legalese
24802, XTO, risk penalty legalese
24803, Sinclair, risk penalty legalese
24804, Sinclair, risk penalty legalese
24805, PetroShale, Antelope-Sanish, 22 wells on an existing 1280-acre unit, McKenzie
24806, Crescent Point, pooling
24807, pooling
24808, Crescent Point, Blue ridge-Bakken, 7 wells on each of four existing 1280-acre units; Williams
24809, Crescent Point, Little Muddy-Bakken, 7 wells on each of 3 existing 1280-acre units, Williams
24810, Statoil, commingling
24811, Statoil, commingling
24812, Statoil, commingling
24813, Statoil, commingling
24814, Statoil, commingling
24815, Statoil, commingling
24816, WPX, flaring
24817, WPX, flaring
24818, WPX, flaring

Thursday, January 21, 2016

Supplemental

24819, commission hearing; confiscation of Black Gold Energy physical assets, file #8403, Dunn
24820, commission hearing, confiscation of Black Gold Energy physical assets, file #16945, Stark
24821, commission hearing, confiscation of Black Gold Energy physical assets, file #9126, Dunn

Friday, January 22, 2016

three continued cases, so far

Construction Of Single-Family Housing At Eight-Year High: Low Interest Rates, Nice Temperatures (Global Warming, No Doubt) -- December 16, 2015

From the Chicago Tribune:

A big jump in apartment construction in the Midwest and South boosted the pace of homebuilding in November, marking a solid bounce back after tumbling in October. Construction of single-family houses also increased and reached an eight-year high.

The Commerce Department said Wednesday that total housing starts — both houses and apartments— climbed 10.5 last month to a seasonally adjusted annual rate of 1.17 million homes. The increase reversed much of drop in stars during October.

There has been a sharp growth in homebuilding, with starts having increased 11 percent so far this year. Solid hiring over the past two years and relatively low interest rates have buoyed the real estate market, encouraging more people to upgrade to two new houses and sign rental leases.

So, new housing starts at an 8-year high, and automobile sales will hit an all-time record this year.

*************************

Fed Rates Raised

FinanceYahoo!is reporting:

The U.S. central bank's policy-setting committee raised the range of its benchmark interest rate by a quarter of a percentage point to between 0.25 percent and 0.50 percent, ending a lengthy debate about whether the economy was strong enough to withstand higher borrowing costs.

Really? "... whether the economy was strong enough to withstand higher borrowing costs...." 0.5%. Really.

One and done.

Random Update On The Whiting Flatland Federal Wells -- December 16, 2015

I am often accused of cherry-picking great wells to "prove" how great the Bakken is. Here I go again. I track these three wells here.

We all know these three wells are great but look at the recent production profiles:

27520, t10/14; cum 550K 6/16;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2015	15	17543	17474	3327	39958	31505	8415
BAKKEN	10-2015	11	9555	9533	6722	30885	22935	7908
BAKKEN	9-2015	11	12391	13521	2691	30454	30375	0
BAKKEN	8-2015	5	7877	6370	1733	13217	13134	33
BAKKEN	7-2015	0	0	184	0	0	0	0
BAKKEN	6-2015	28	21677	21968	1440	57929	57690	190
BAKKEN	5-2015	27	28754	29152	3567	130024	129332	640
BAKKEN	4-2015	30	36976	37084	4012	146518	145911	547
BAKKEN	3-2015	31	46708	46286	4808	181103	180141	900
BAKKEN	2-2015	28	46881	47420	4187	146103	143797	2250

27521, t10/14; cum 386K 6/16;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2015	15	6407	6569	2606	19026	15001	4007
BAKKEN	10-2015	14	7968	7859	4897	23550	17488	6030
BAKKEN	9-2015	11	7346	7522	1921	25719	25653	0
BAKKEN	8-2015	3	2090	2192	1491	5649	5613	14
BAKKEN	7-2015	22	11590	11171	1543	43230	43125	63
BAKKEN	6-2015	16	9802	9949	699	24690	24580	81
BAKKEN	5-2015	27	13899	14139	1702	54099	53781	266
BAKKEN	4-2015	30	19908	20005	2296	74605	74267	278
BAKKEN	3-2015	31	26998	26811	3157	100230	99670	498

 
27522, t10/14; cum 367K 6/16;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	11-2015	16	11513	11539	5552	31520	26033	5457
BAKKEN	10-2015	17	4874	4745	1721	10419	10393	0
BAKKEN	9-2015	7	3907	4296	1275	16310	16298	0
BAKKEN	8-2015	7	7268	7563	549	16132	16043	76
BAKKEN	7-2015	23	12388	11988	2175	50965	50803	118
BAKKEN	6-2015	21	11170	10888	879	26641	24436	2168
BAKKEN	5-2015	27	14749	14978	2209	75326	74877	397
BAKKEN	4-2015	30	20039	20889	3286	99058	98998	0
BAKKEN	3-2015	31	26002	25795	3936	105743	105681	0
BAKKEN	2-2015	28	30709	30975	4245	99837	98664	1117

Random Look At HRC Eagle Nest Well -- December 16, 2015 -- 10,000 Bbls Produced Over 4 Days

There are five wells on this pad, all running to the north:

• 28280, see below;
• 28281, conf, huge well, started producing 6/15;
• 25502, 3,161, t6/15; cum 117K 10/15; produced 41K in the month of July, 2015
• 24417, 2,174, t6/15; cum 74K 10/15;
• 24418, 2,054, t6/15; cum 75K 10/15;

There are five wells to the east in the same section (a 3-well pad, and two singletons):

• 30267, loc, one has to assume this one was not completed at same time as the others due to price environment
• 30268, conf, huge well,
• 30269, conf, huge well;
• 18094, 1,323, t2/10; cum 246K 10/15 (was off-line 5/15 - 7/15)
• 21066, 1,347, t1/12; cum 220K 10/15 (was off-line 6/15 - 8/15)

This well came off confidential list today:

• 28280, 2,616, HRC, Fort Berthold 148-94-17C-8-6H, Eagle Nest, Sherman pad, 54 stages, 4.5 million lbs, t6/15; cum 86K 10/15; 

Side tracks:

• 12/24/14: shale strike at 14,921 feet; tripped out and then side tracked started at 14,131 to 14,139 feet.
• 12/25/14: attempt to side track failed; tripped out and began other side track at 13,760 to 13,789 feet.
• 12/27/14: second side track attempt failed; tripped out and began another side track at 13,068 to 13,112 feet.
• 12/31/14: successful third side track from 13,112 until experiencing another shale strike at 17,390 feet; tripped out and began a side track at 16,390 to 16,430 feet.
• 12/20/15: after another side track fail at 15,652, operator tripped out and side tracked once more beginning at 15,712 feet and drilled to TD, 20,703 feet.

Production profile (note 10,409 bbls over four days in September, 2015):

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2015	23	11968	11796	8475	10090	9574	355
BAKKEN	9-2015	4	10409	10372	7236	9680	7955	1697
BAKKEN	8-2015	14	9924	10222	9497	10796	5388	5310
BAKKEN	7-2015	31	33475	34129	39179	51853	0	51636
BAKKEN	6-2015	15	20342	19152	29535	26192	0	26087

Wednesday, December 16, 2015; US Likely To Repeal Ban On Crude Oil Imports; Fed Raises Rates (One And Done)

Updates

Later, 4:07 p.m. Central Time: WSJ has article on repeal of the ban on crude oil imports. 

Original Post

Active rigs:

	12/16/2015	12/16/2014	12/16/2013	12/16/2012	12/16/2011
Active Rigs	64	184	191	181	199

RBN Energy: Last in a series on the Permian Basin buildout.

No links, the story is everywhere. It looks like the US will allow crude oil to be exported. Time to close the poll at the sidebar in which we asked, whether President Obama will allow the US to export oil starting in 2016?

• yes: 12%
• no: 45%
• yes, with lots of conditions, including credits for solar/wind: 44%

Magnum Hunter files for bankruptcy protection. CNBC story here. The history of Magnum Hunter from my "Bakken Operators" page:

Magnum Hunter Resources (MHR) 
(Bakken Hunter is the subsidiary working the Bakken)

• December 16, 2015: files for bankruptcy protection. 
• September 27, 2014: looking to leave North Dakota; SeekingAlpha, Richard Zeits
• June 3, 2014: 97,000 net acres in North Dakota; Bakken acreage big in Canada, MT
• August, 2013: 377 net drilling locations in the North Dakota Bakken; 
• Will align its wells with existing ONEOK natural gas pipelines; March 2013
• November 25, 2012: to buy 20,000 net acres and production from Samson Resources for $30 million in cash; Divide County, along Canadian border
• 132,000 acres in the Bakken/Tableland; the Tableland is in Saskatchewan (Canada)
• Baytex sells 50,400 net acres of ND Bakken acreage to Magnum Hunter; 950 boepd; $311 million cash; -- 128,400 net acres? total?
• 78,000 net acres (Dunn, McKenzie, SE Saskatchewan); prior to the Baytex deal
• To acquire about 7,750 net acres; announced August, 2011
• 4Q12, estimate exit rate: >16,000 bopd
• 4Q11: 12,000 bopd exit rate
• 3Q11: 5,270 bopd 
• 2011 revenues: $50 million

Reuters/Rigzone reports:

Oil and gas producer Magnum Hunter Resources Corp and its affiliates filed for Chapter 11 bankruptcy protection on Tuesday to carry out a debt-cutting plan as a prolonged slump in oil prices has depleted the company's cash.

The company entered into a restructuring agreement that will convert its funded debt into equity, substantially reducing its more than $1 billion in debt, according to a company statement. Magnum Hunter ranks among the biggest energy producers to file for bankruptcy this year, joining Samson Resources Corp, Sabine Oil & Gas Corp, Quicksilver Resources Inc and Energy & Exploration Partners Inc.

To fund its operations during its bankruptcy, the company's lenders agreed to provide up to $200 million in financing, which will also convert into equity when Magnum Hunter emerges from bankruptcy, according to the statement. Magnum Hunter, which operates primarily in the Appalachian Basin in West Virginia and Ohio, said it expects to emerge from bankruptcy in April.

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Late Night Talk-Shows

My sentiments exactly.  My favorite: James Cordon. Can watch him on YouTube.