Thursday, February 11, 2016

Wells Coming Off Confidential List Friday -- February 11, 2016

These are being posted early; this is my last post for about 24 hours. Good luck to all. 

Anything posted in last 48 hours subject to more typographical and factual errors than usual. Posted quickly. Will correct errors when I find them later next week.

Wells coming off confidential list Friday:
  • 28754, A/no IP, Oasis, Kline Federal 5300 31-18 8B, Baker, firs production 9/15; cum 48K 12/15;
  • 28755, 1,774, Oasis, Kline Federal 5300 31-18 7T, Baker, t9/15; cum 30K 12/15; on-line about half the time since it was tested;
  • 28756, 1,174, Oasis, Kline Federal 5300 31-18 6B, Baker, t9/15; cum 43K 12/15; off-line much of the time since it first started producing;
  • 30730, drl, Slawson, River Rat Federal 2-23-14H, Big Bend, no production data,
  • 30789, 1,479, Oasis, Kline Federal 5300 31-18 15T, Baker, t9/15; cum 49K 12/15; off-line much of the time it first stared producing;
  • 31585, SI/NC, Statoil, Ruth 28-33 8TFH, East Fork, no production data,
  • 31663, SI/NC, Hess, AN-Evenson-152-95-0310H-12, Antelope, no production data,

30789 see above, Oasis, Kline Federal 5300 31-18 15T, Baker:

DateOil RunsMCF Sold

28756, see above, Oasis, Kline Federal 5300 31-18 6B, Baker:

DateOil RunsMCF Sold

28755, see above, Oasis, Kline Federal 5300 31-18 7T, Baker:

DateOil RunsMCF Sold

28754, see above, Oasis, Kline Federal 5300 31-18 8B, Baker:

DateOil RunsMCF Sold

Jobless Claims Fall Much More Than Expected -- February 11, 2016

Weekly jobless claims plummet to 269,000 vs 281,000 estimated. Whenever I see such a huge discrepancy, it makes me wonder. How can analysts be so far off? I guess economy improved remarkably since last week.
Initial claims for state unemployment benefits declined 16,000 to a seasonally adjusted 269,000 for the week ended Feb. 6, the Labor Department said on Thursday. The prior week's claims were unrevised.
The four-week average fell 3,500 to 281,250. 

Thursday, February 11, 2016


2:02 p.m. Central Time: departing Belfield under overcast skies, but sun trying to break through. Looks like an absolutely gorgeous day. I would call it partly sunny and getting better. The Dickinson Press would probably call it overcast, with chance of more gloominess before dusk in just a couple of hours. 

1:22 p.m. Central Time: Belfield. Roads were fine between Williston and Belfield. Traffic moving 10 mph below the posted speed limit between Williston and Watford City; moving at the posted speed limit south of Watford City all the way to Belfield.
Original Post
It looks like I will be departing the Bakken today. Light snow falling; seems a bit warm. The snow is heavy, wet, sticky. Yes, it's about 24 degrees, apparently. Really warm for this time of year.

Market looks to be extremely volatile (a Wall Street euphemism for "scary"). I'm sure glad Janet Yellen started raising rates last year; gives her an opportunity to cut rates this year. LOL. She "doesn't know if she has legal authority" to cut to "negative rates." I suppose if she doesn't know, no one knows except President Obama. The US is fortunate to have an experienced finance expert at the helm.

What a mess for MDU, ratepayers, and regulators. The Dickinson Press is reporting (archived):
Montana Dakota Utilities has scaled back a 21.1 percent electricity rate increase it had been requesting in Montana, but that didn’t stem the tide of questions the company faced at a public hearing that started Tuesday in Glendive.
In North Dakota, they’ve been collecting costs for these upgrades via trackers and riders so there has not been a public hearing process per se. This makes the Montana public hearings an important arena for public engagement about the requested rate increase that would cover the three states.
While the rate increases are for Montana customers, MDU has an integrated electric system that is serving customers in a three-state area that includes western North Dakota and South Dakota.

The company’s original proposal to the Montana Public Service Commission sought to recover $11.4 million annually in costs, but two Montana advocacy groups both said justifiable recovery costs were more like $2 or $3 million.
I suppose this is the cross we bear with federal government dysfunction, questionable presidential executive orders, a slumping economy, a Bakken bust, a killed Keystone, and PPP.

For those still interested, this is the transcript for 4Q15 earnings, MDU:

The Dickinson refinery: it looks like the writing is on the wall. Refinery utilization target is 90%.
We are working on optimizing where the plant is at. Longer-term, you know this is a business you have to get in on scale, not just one refinery, you have to have several or else you would exit. Obviously, we may not be the right long-term owner but at this point that decision hasn't been made. (page 3) 
Our refining segment includes the company's 50% interest in the Dakota Prairie Refinery which began commercial operations just in May of last year. Our share of 2015 refining results is an adjusted loss of $20.5 million. Earnings were impacted by unplanned outages in October and November due to equipment problems that have since been repaired. Economics have also been affected by historically low Bakken differentials from the West Texas Intermediate pricing, which has reduced the discount for our oil feedstock.

Thursday, February 11, 2016

Active rigs:

Active Rigs41137195183203

RBN Energy: Warm Winter and Surging Production Push Gas Storage Surplus Higher (And Prices Lower).
As of the weekly EIA natural gas storage report due out today (Thursday) for the week ending February 5, 2016, the U.S. gas inventory surplus is likely to grow to near 600 Bcf above levels at the same time last year. Current weather forecasts suggest the surplus over 2015 will soar to near 800 Bcf by the end of February. With outright inventory levels already exceptionally high, this surplus growth kicks the market’s oversupply problem further down the futures curve – meaning prices could stay lower for longer. Today we look at the winter 2015-16 fundamentals leading to this surplus and what it means for the rest of 2016.
The gas market started this winter (November 2015 to March 2016) oversupplied, with a record high inventory and a surplus of nearly 400 Bcf versus the previous year. At the time a cold hard winter presented the best chance to correct the supply/demand imbalance through increased heating demand. But weather forecasters instead predicted an exceptionally warm winter due to the effects of El Nino. And sure enough, winter has been largely a no-show so far. Meanwhile, on the supply side, gas production has not given up any ground, and in fact, has even experienced another surge to record levels in recent weeks. This mixture of lower demand and higher supply has meant not as much gas has been withdrawn from storage to meet winter peak needs as usual this year.  As a result, the storage surplus has continued to grow.