Wednesday, February 10, 2016

Wednesday, February 10, 2015

Global warming: we should see record-setting lows over Valentine's Day weekend --
The coldest air of the season is poised to plunge into the Northeast this coming Valentine's Day weekend. This Arctic blast will not only flirt with some daily records, but will also bring subzero cold to parts of the Midwest and reinforce the cold in the Southeast.
Reporting today:
  • Tesla, after hours, forecast, 8 cents; loss tripled to $2.44/share, compared to 86 cents/share a year earlier;
  • Twitter, after hours, forecast, 12 cents; at 16 cents/share, beat estimates but shares fell in Wednesday after-hours trading as the company revealed that its user numbers had declined sequentially.
Reporting tomorrow:
  • TransCanada (TRP.TO), before market open, 61 cents forecast
Wells coming off confidential list Thursday:
  • 30432, SI/NC, Statoil, Jack 21-16 2H, East Fork,
Active rigs:

Active Rigs41137196185203

Seven (7) new permits --
  • Operators: EOG (5), MRO (2)
  • Fields: Parshall (Mountrail), Lost Bridge (Dunn)
  • Comments: the five new EOG wells will be sited in section 13-153-90, and appear to be spaced for sections 12/13. In those two sections:
  • 17044, 1,519, EOG, Wayzetta 6-12H, Parshall, t11/08, cum 496K 12/15;
  • 17083, 956, EOG, Wayzetta 1-13H, Parshall, t9/08, cum 403K 12/15;
  • 25747, 915, EOG, Wayzetta 29-1424H, Parshall, t4/14; cum 229K 12/15;
Whiting renewed three permits, all Charging Eagle permits in Dunn County.

No producing wells were reported as completed. 

Wednesday, February 10, 2016 -- Off The Net For Awhile

I see we have a new nominee for the 2016 Geico Rock Award. I'm proud to add Ms Janet Yellen to the list of distinguished nominees for 2016. According to the CNBC early morning business show, in the crawler: Economic Outlook Is Uncertain.

2016 nominees are posted here:

It is noteworthy that she made that comment within a day or two of President Obama sending a $4.1 trillion budget to Congress with a plan to pay for increased spending to save the Maldives by adding a global crude oil fee of $10/bbl. I did the math and found that the money raised through that $10/bbl would be no more than a rounding error in a $4.1 trillion bill.

Apparently, President Obama's advisers did the math after reading the blog. They have since raised the $10/bbl proposal to $10.25.

Okay, that's good.


I thought I had posted the math.

The US produces 10 million bopd.

At $10/bbl = $100 million.

Over one year, x 365 = $36,500 million = $36.5 billion. Let's call it $50 billion.

Now, that $4.1 trillion budget.

That's $4,100 billion.

Can anyone tell me the difference between $4,150 billion, $4,100 billion, or $4,050 billion?

That's why they call it a rounding error.

50 / 4,100 = 1%.

But if it will kill the US oil and gas industry and save the Maldives, it it probably worth it.

Disclaimer: I often make simple arithmetic errors. If this information is important to you, get out your own calculator. My calculator doesn't go past nine zeroes. Until recently, that was not a problem.

Last To Know -- February 10, 2016

I heard yesterday that construction will begin this summer to widen the two-lane US Highway 1804 into a four-lane highway east of Williston to the Epping turnoff, about 12 miles east of Williston. That was from a credible source who is involved in a major project that will be affected by that construction. More to follow.

US Highway 1804 section highlighted in blue to become a four-line highway.

This highway project is way over due, but considering all that had to be done, DOT prioritized very, very well. But this is going to be a huge and very, very necessary project. I assume the road north to Epping will be eventually improved. It's amazing how well things work out. The slowdown has given folks a chance to catch up. It will be interesting to see who has the contract for this project. Many of the highway projects in Williams County were done by out-of-state firms, including firms as far away as Lithia, Florida (Tampa area).

The video I posted yesterday was taken from one of the county roads heading north to Epping.

Later, when I get a chance, I will post a photograph of the new casino going up in Trenton, North Dakota, southwest of Williston. Okay, I have a chance now:

 Trenton Casino, February 8, 2016

February 10, 2016

 From Bloomberg: I see that President Obama has raised his proposed $10/bbl fee on oil to $10.25. I'm not even going to read the rest of the story. I'm beginning to think he is suffering from early onset dementia. For me, the $10.25 / bbl fee on crude oil is a win-win. I have no problem how this plays out.
This is what Saudi Arabia was waiting for: the end of hedges. And now the fun begins. Reuters, meanwhile, sees the global oil glut worsening. There will be no OPEC deal. IEA says it is "unlikely" there will be any deal. I can pretty much bet a year's salary there will be no deal.

By the way, has Tesla reported yet? I don't see any news yet. The expectation is that Tesla will report after the market closes today.

The Los Angeles Times is full of interesting front page news today: this one stood out: FBI can't figure out how to unlock encrypted phone in San Bernardino investigation:
FBI technicians have been unable to unlock encrypted data on a cellphone that belonged to the terrorist couple who killed 14 people in San Bernardino on Dec. 2, the FBI director said Tuesday.
The failure, the second such case in recent months, has left investigators in the dark about at least some of the married couple's communications before they were killed in a shootout with police.
“We still have one of those killers' phones that we haven’t been able to open," FBI Director James B. Comey told the Senate Intelligence Committee. "It has been two months now and we are still working on it."
Neither the brand nor the model of the cellphone was mentioned. That information will eventually be released. For now, one can place bets in Las Vegas: 1-5 odds that it was an iPhone; 60-1 it was Android. 

Hillary Clinton could probably offer some advice.

Wednesday, February 10, 2016

I had planned to depart Williston today, but I've been enjoying being with Dad, so I've decided to stay at least a day longer, which will probably end up being an additional day. Of course, that brings us to the weekend, which is the toughest part of the week for day -- the weekends are just too long for him, so maybe I will stay through the weekend, and, then, of course, we are well into February, and I might as well stay until March, and, then, of course, that's the end of the first quarter and I might as well see what the spring brings. And, of course, then summer's just around the corner ....


I would love to write what specifically changed my mind, but it would sound corny, so I will leave readers in suspense. It had to do with the books I am reading. I'll get back to those later, now that I have more time in Williston.

I can't sleep past 4:30 a.m. and so I read (there is no television or internet where I am staying, by choice). I have three books that I am reading but this morning, after making the decision to stay longer, I decided to see if a coffee shop with wi-fi was open, so I could write my wife, daughter, and others that I would not be departing today. To my pleasant surprise, the Daily Addiction was open, opening at 6:00 a.m.

It was wonderful to be able to be served immediately. During the boom, it would have been a significant wait. But now, much more normal. It will be a small but constant stream of people coming through. Had there been no boom, there would be no coffee shop like on Main Street.

Of course, it was still dark. It was quite incredible to look to the east across the Little Muddy from the top of University Avenue to see all the lights. There is another whole town over there, it seems.

I was told  yesterday that the living quarters over at Halliburton east of Williston were now empty. For some reason that did not bother me. Williston is experiencing a new "normal." I think old-timers feel good about this for the most part. It is now clear that the Bakken is not going to go away, and perhaps with a bit of luck, the boom and bust cycle will flatten out a bit.

For the second time in a row -- either second enrollment period, or second year -- Williston State College has set a new enrollment record. I had forgotten: Williston State College is free for Williams County residents. Bernie Sanders should visit Williston for a photo op during the national campaign once he gets the Democratic nomination for President. Presidential nominees usually make one North Dakota stop -- Fargo -- but seldom Williston. Seldom. LOL.

Harry S Truman stopped in Williston back in 1952. He was taking the same route that Liam and Sam would take almost a century later on I-98 but doing it by train.

District 8 -- a rural school district in the Williston area voted down a $39 million bond measure for a new "K-8" school due to increasing enrollment, but not because it was not needed. Rightly, the voters said that is as a state responsibility to ensure adequate facilities for public education. We'll see if the Bernie Sanders supporters in Bismarck and Fargo agree. I have my hunches. No child left behind. By the way, this was a "new public school district" driven by the boom. It will be interesting to revisit this school district a year from now.

On the other hand, another school district in the Bakken voted to pass a similar bond issue for remodeling its schools. That bond issue was for $!0 million. I "missed" the district but I believe it was north of Williston. Oh, yes, here it is: Divide County, north of here. Crosby. Awesome. Something tells me this bond issue would not have passed if things looked desperate in the Bakken or western North Dakota. Good for them, up in Crosby. No child left behind.

Speaking of presidential nominees visiting North Dakota: Bernie Sanders can do a photo op in front of Williston State College where tuition is free and "Donald Thump or Mark Robio or Jeff Bush" as my dad refers to the GOP roster of candidates, could and should visit the Bakken.

It's possible North Dakota could be the swing state this fall. LOL.

In a few minutes, I will be walking around the corner to buy a dozen or so donuts from the Donut Shop on Broadway, to take them to Dad's former agency where he still reports to work if someone drives him. He doesn't offer as much business advice as he did when he was 90 years old. He says if the folks at the office haven't figured things out by now -- he's been offering them advice for over 30 years without being paid a consultant's fee -- they will never figures things out.

That comment about the consultant fee is not entirely correct. During his 80's, he was paid about $100/month as a retainer fee of some sort, so that he wouldn't jump to the competition.

It's going to be another incredibly beautiful day in the Bakken. I'm still trying to find the downside of global warming. 

Wednesday, February 10, 2016

Active rigs:

Active Rigs41137196185203

RBN Energy: Refined Product Pipelines Secure U.S. Supplies As Mexican Refinery Upgrades Begin.
Mexican production of gasoline, diesel and jet fuel continues to fall and Mexico’s imports of these refined petroleum products from the U.S. are rising fast to keep pace with increasing demand. Longer term upgrade projects to increase Mexican refinery transport fuel are finally underway. But before refinery upgrades make a dent in imports, two ambitious refined-products pipeline/terminals projects will make it easier and more efficient to move large volumes of gasoline, diesel and jet fuel from Texas refineries into Mexico.  Today, we update our coverage of fast-moving developments in Mexico-U.S. hydrocarbon trading.
In the past few months we’ve talked a lot about Mexico’s energy sector, particularly it’s evolving relationship with the U.S. regarding oil, natural gas, natural gas liquids (NGLs) and refined petroleum products. In several blogs—including The Gas All Went to Mexico and As We Send Gas Through the Streets of Laredo—we discussed Mexico’s growing dependence on U.S.-sourced natural gas, which is fueling more and more of the country’s power plants and industries. We also considered all the gas pipelines being built to move that gas south. In our Enciende Mi Fuego (Light My Fire) series, we described Mexico’s need for increasing amounts of liquefied petroleum gas (LPG, e.g., propane/butane) from the U.S., and again we looked at the pipelines being installed to move LPG to Mexican consumers. And then, in our With a Little Help From My Friends series and Drill Down report, we looked at the big picture, namely the growing energy interdependence of Mexico and U.S. in everything from oil to natural gas and NGLs. We did made reference to refined petroleum products like gasoline, diesel and jet-kero,in those analyses, but didn’t dive too deeply into them because there was so much else to talk about. In the past few weeks though, three significant developments have occurred, giving us an opportunity to revisit the topic.
First a quick recap. Mexico, you may recall, is between a rock and a hard place when it comes to hydrocarbons. It has extraordinary crude and natural gas resources, but oil production has been declining and gas production has been flat, in part because state-owned PetrĂ³leos Mexicanos (Pemex) has been unable to make the investments needed to boost output. Pemex’s refineries also need upgrading; there have been disconnects between 1) the types of crude that Pemex produces (mostly heavy) and the capabilities of the company’s refineries, and 2) the yields of various refined oil products (fuel oil, gasoline and diesel, for instance) that Pemex’s refineries can produce and the domestic demand for those products. Mexico and Pemex have been trying to get things back on track, in part by opening up the hydrocarbon sector to private-sector investment and competition. These efforts have come in fits and starts—and, it’s got to be said, they’ve occurred at a particularly challenging time, with crude prices near their lowest levels in a dozen years and investment cutbacks being the order of the day.