Tuesday, April 26, 2016

Random Look At One BR Case In The May, 2016, Docket -- NDIC Hearing -- April 26, 2016

The summary of the May, 2016, docket agenda was posted here. This was one of the more interesting cases. Note: this is case #25020, NOT a permit or file number.

25020, BR, Westberg and/or Elidah-Bakken, establish three 2560-acre units; 12 wells on one unit; 13 wells on the second unit; and 16 wells on the third unit; establish a 5120-acre unit for two wells; McKenzie County:
  • 15/22/27/34-152-97: 12 wells (stand-up 2560-acre unit)
  • 2/11/14/23-152-97: 13 wells (stand-up 2560-acre unit)
  • 28/33-152-97 & 4/9-151-97: 16 wells (stand-up 2560-acre unit)
  • 15/16/21/22/27/28/33/34-152-97: 2 wells (5120-acre unit)
In the graphic below, the three new stand-up 2560-acre units are outlined in US Air Force blue; the new 5120-acre overlapping unit is outlined in US Army green.

Generally speaking, wells in a stand-up 2560-acre unit are all sited "in the middle." I have no clue where the two wells drilling the 5120-acre unit will be sited, but they will probably be "simple" long laterals. 

Note that in that one area there are already 11 wells, some still confidential:
  • a 2-well pad
  • a singleton
  • another singleton
  • a 4-well pad
  • a 3-well pad 
For newbies, this still does not "max" out the number of wells that can be placed in these drilling units.

Hearing Docket Agenda For May, 2016; Note The COP Request For EOR

I track the dockets here.

The NDIC index for the agendas for the hearing dockets is here.

Thursday, May 19, 2016
25014, Hess, Big Stone-Bakken, proper spacing, Williams County
25015, Murex, Daneville-Bakken, proper spacing, Divide County
25016, Mountain Divide, Fortuna-Bakken, proper spacing, Divide County
25017, Murex, Clinton-Bakken, proper spacing, Divide County
25018, New Millenium Resources, amend, shut in or temporarily abandon, #10147, Stark County
25019, BR, revoke a permit issued to Abraxas, Yellowstone Boxer 1H, #32634, McKenzie County
25020, BR, Westberg and/or Elidah-Bakken, establish three 2560-acre units; 12 wells on one unit; 13 wells on the second unit; and 16 wells on the third unit; establish a 5120-acre unit for two wells; McKenzie County
25021, Hess, to temporarily abandon Fryburg Heath-Madison, #3502, Billings County
25022, Hess, to temporarily abandon Fryburg Heath-Madison, #6009, Billings, County
25023, Hess, to temporarily abandon Fryburg Heath-Madison, #3918, Billings County
25024, Hess, to temporarily abandon Fryburg Heath-Madison, #6070, Billings County
25205, Hess, Hess, to temporarily abandon Fryburg Heath-Madison, #15593, Billings County
25026, Hess, Big Butte-Bakken, injectivity test, utilizing an existing well known as the EN-Person Observation 11-22 well; establish spacing for this injection well; Mountrail County
25027, COP, EOR, West Dickinson Lodgepole Unit, Stark County
25028, QEP, Spotted Horn-Bakken, setback relief for a single well, McKenzie County
25029, MRO, Antelope-Sanish, 4 wells on a 640-acre unit; 12 wells on a 1280-acre units; reduce setback rules; McKenzie County
25030, Petro Harvester, pooling;
25031, Petro Harvester, pooling;
25032, Petro Harvester, pooling;
25033, Petro Harvester, pooling;
25034, Petro Harvester, pooling;
25035, Petro Harvester, pooling;
25036, Petro Harvester, pooling;
25037, Petro Harvester, pooling;
25038, Petro Harvester, pooling;
25039, Petro Harvester, pooling;
25040, Petro Harvester, pooling;
25041, Petro Harvester, pooling;
25042, Petro Harvester, pooling;
25043, Petro Harvester, pooling;
25044, Petro Harvester, pooling;
25045, Petro Harvester, pooling;
25046, Petro Harvester, pooling;
25047, Petro Harvester, pooling;
25048, BR, pooling;
25049, BR, Little Knife-Bakken, 8 wells on a 1280-acre unit; Dunn
25050, Petro Harvester, pooling;
25051, Hess, Little Knife-Bakken, 9 wells on a 1280-acre unit; Dunn
25052, Hess, Big Gulch-Bakken, 13 wells on a 1280-acre unit; Dunn

Friday, May 20, 2016
25053, Hunt, Murex, Writing Rock-Bakken, proper spacing, Divide
25054, EOG, revoke a permit issued to PetroShale (US), #32625, McKenzie County
25055, PetroShale (US), Antelope-Sanish, amend, drill on a 1280-acre unit in lieu of the 640-acre units; McKenzie County
25056, Denbury Onshore, to temporarily abandon #12001, Fryburg Field, Billings County
25057, Great Plains Energy, exception to bond amount for conducting shot-hole geophysical exploration while utilizing new receiver technology, Stark County
25058, XTO, pooling;
25059, XTO, pooling;
25060, WPX, pooling;
25061, Zavanna, pooling;
25062, Zavanna, pooling;
25063, CLR, flaring,
25064, CLR, flaring,
25065, CLR, flaring,
25066, CLR, flaring,

Statoil Reports Another Huge Skarston Well; Three (3) New Permits -- April 26, 2016

Active rigs:

Active Rigs2784182187208

Only one (1) well coming off confidential list Wednesday:
  • 31556, SI/NC, Hess, HA-Chapin-152-95-2932H-6, Hawkeye, small production reported;
Three (3) new permits --
  • Operator: Hess
  • Field: Hawkeye (McKenzie)
  • Comments:
Slawson canceled three permits, one Bandit Federal and two Serpent Federal permits in Mountrail County.

One (1) producing well completed, and it's another incredible Statoil Skarston (I track the Skarston wells here):
  • 29563, 4,278, Statoil, Skarston 1-12 8TFH, Banks, t3/16; cum --

Hillary: It's About Gun Safety, Not Gun Control (Chelsea Did Not Get The Memo) -- April 26, 2016

The other day I mentioned that Hillary Clinton has very quietly changed her stand on the gun issue during the primary season. Mainstream media missed it then, but they are starting to pick up on it. Hillary is moving from "gun control" to "gun safety." Very, very interesting. As I've always said, unlike ideologues, Hillary can be bought. [I believe I'm wrong: Hillary seems to be consistently inconsistent on the gun issue; it depends on her audience how she addresses the Second Amendment.]

From two days ago, April 24, 2016, in American Thinker:
Currently running in Pennsylvania, a state with enough gun owners to swing an election, Hillary was forced into an awkward pander:

“I want to be really clear about this, because I learned how to shoot a gun behind our cottage in Lake Winola,” Mrs. Clinton said. “And I know how important gun ownership and particularly hunting is here in northeastern Pennsylvania.”

“I want you to know that we can’t ignore the Second Amendment, and we can’t ignore that 33,000 people a year die from gun violence,” she said. “I think we are smart enough to figure out how to do that.”

Twitter exploded in reaction, with many people pointing out that the Second Amendment is not about hunting.

But Chelsea’s comment, on video, is a bell that can’t be un-rung. No matter how quickly Hillary moves to quiet concern over her anti-gun ownership predilections, Chelsea has made it clear that a Hillary presidency will lead to a Supreme Court that will hold there is no individual right to own guns. 
Chelsea, apparently, did not get the memo, either, that her mom had modified her position.

By the way, that "stuff" about learning to shoot behind her cottage in Lake Winola is not new. Eight years ago, back in 2008, from CNN:
Hillary Clinton appealed to Second Amendment supporters on Saturday by hinting that she has some experience of her own pulling triggers.
“I disagree with Sen. Obama’s assertion that people in our country cling to guns and have certain attitudes about trade and immigration simply out of frustration,” she began, referring to the Obama comments on small-town Americans that set off a political tumult on Friday.
She then introduced a fond memory from her youth.
“You know, my dad took me out behind the cottage that my grandfather built on a little lake called Lake Winola outside of Scranton and taught me how to shoot when I was a little girl,” she said.
“You know, some people now continue to teach their children and their grandchildren. It’s part of culture. It’s part of a way of life. People enjoy hunting and shooting because it’s an important part of who they are. Not because they are bitter.”
Minutes later, in a slightly awkward moment, Clinton faced a question from a woman in the audience whose son had been paralyzed by a gunshot. The woman asked Clinton what she would do about gun control as president.

More On The Skarston Wells, Banks Oil Field -- April 26, 2016

NOTE: don't update this page. The Skarston wells are now tracked / updated here.


July 15, 2016
Monthly Production Data

Update on eight Skarston wells on an 8-well pad.

Note that two of them are listed as "INACTIVE" and several have been off-line much of this time. According to the NDIC May, 2016, production data, the following Skarston wells were "SI": 21664, 25859, and 25856. The well drilled in 2012 (#21664) is now classified as "AB" according to the file report. "Batch-drilled,"  spud date, TD date; test date:.
  • 25854, 3,098, Skarston 1-12 2TFH: 9/21/14; 11/12/14; t4/16; cum 341K 3/19; see full production profile here;
  • 25856, 3,645, Skarston 1-12 7H: 9/19/14; 12/01/14; t3/16; cum 224K 3/19; -- went inactive after 7 days 4/16; inactive through 5/16; back on status for full month 8/16; sporadic production lately suggesting activity, 3/19;
  • 25857, 4,545, Skarston 1 -12 4H, 41 stages; 6 million lbs: 9/17/14; 12/08/14; t4/16; cum 380K 3/19; sporadic production lately suggesting activity, 3/19;
  • 25858, 5,010, Skarston 1-12 5H: s9/14/14; 2/14/15; t3/16; cum 433K 3/19; off-line all of 4/16 and back on-line for last 20 days in 5/16; on-line since then; 41 stages; 9.2 million lbs;
    sporadic production lately suggesting activity, 3/19;
  • 25859, 3,802, Skarston 1-12 6TFH: 9/14/14; 2/25/15; t3/16; cum 240K 3/19; production report shows the well was not on line all of 4/16 and 5/16; produced 9,455 bbls over 31 days in 3/16; back on status since 6/16; sporadic production lately suggesting activity, 3/19;
  • 25855, 3,115, Skarston 1-12 3TFH: 9/10/14; 3/11/15; t4/16; cum 215K 3/19; off-line all of 5/16; back on status as of 7/16; sporadic production lately suggesting activity, 3/19;
  • 29563, 4,278, Skarston 1-12 8TFH: 1/07/15; 2/5/15; stimulated 10/15; 40 stages, 6 million lbs; t3/16; cum 166K 3/19; on-line only 7 days in 4/16; off-line all of 5/16; back on status as of 8/16; sporadic production lately suggesting activity, 3/19;
  • 29564, 3,583, Skarston XE 1H: 11/11/14; 4/14/15; t3/16; cum 356K 3/19; on-line only 6 days in 3/16; 7 days in 4/16; and only 19 days in 5/16; back on status as of 5/16; sporadic production lately suggesting activity, 3/19;
  • 21664, 3,235, Equinor, Skarston 1-12 1H, Banks, t9/12; cum 329K 3/19; sporadic production lately suggesting activity, 3/19;
Record IP? see FAQ #9 at this post

According to a sundry form dated February 16, 2016: Statoil reqeusted a waiver to NDAC Sec 43-02-03-55 and seeks time to meet compliance. The wells listed below (the same wells above) were batch drilled on a multi-well pad. Statoil requests an extension to be granted for all wells on the pad based on the last day total depth was reached for the last well on the pad [4/14/15, TD date for #29564]. The Skarston 1-12XE #1H was the last well batch drilled on the multi-well pad for the previously listed 8 wells. In addition, production from the existing Skarson 1-12 1H (#21664) ceased to accommodate drilling operations. A letter dated 1/25/2016 from Rick Dunn (NDIC) requires production be restored or the well be plugged and abandoned. Statoil requests that the extention be granted for all nine wells until 4/14/2016 to be bring the wells into production.


This has to do with the Skarston well that was reported yesterday, a DUC:
  • 25858, 5,010, Statoil, Skarston 1-12 5H, Banks, a middle Bakken well, t3/16; cum see above.
With another Skarston well on this pad, there was evidence of communication with another well from a pad in a neighboring section. Link here: http://themilliondollarway.blogspot.com/2015/11/evidence-of-communication-between-wells.html.

Other pertinent links:
I used to track the Skarston wells elsewhere, but will move the tracking to this post.

Statoil's Skarston Wells
Banks Oil Field

Originally posted April 22, 2016.

Eight wells on an 8-well pad, "batch-drilled," spud date, TD date; test date:
  • 25854, 3,098, Skarston 1-12 2TFH: 9/21/14; 11/12/14; t4/16; cum 8K over first 12 days;
  • 25856, 3,645, Skarston 1-12 7H: 9/19/14; 12/01/14; t3/16; cum --
  • 25857, 4,545, Skarston 1 -12 4H: 9/17/14; 12/08/14; t4/16; cum --
  • 25858, 5,010, Skarston 1-12 5H: 9/14/14; 2/14/15; t3/16; cum --
  • 25859, 3,802, Skarston 1-12 6TFH: 9/14/14; 2/25/15; t3/16; cum --
  • 25855, 3,115, Skarston 1-12 3TFH: 9/10/14; 3/11/15; t4/16; cum --
  • 29563, 4,278, Skarston 1-12 8TFH: 1/07/15; 2/5/15; t3/16; cum --
  • 29564, 3,583, Skarston XE 1H: 11/11/14; 4/14/15; t3/16; cum --
So, between 11/12/14 and 4/14/15: 8 wells on an 8-well pad drilled to depth. I assume they can be fracked within a couple of weeks, and oil in the national pipeline system within 30 days.

As of April, 2016: all on SI/NC status.

We Start The Day With 25 Active Rigs In North Dakota, A New Post-Boom Low -- Down From 200 During The Boom -- April 26, 2016

It should be noted that in addition to "everything else," all travel on gravel roads in McKenzie County has pretty much come to a stop due to rain and mud. The Bismarck Tribune is reporting:
This adds up to a substantial number of days when trucks have to severely lighten loads of oil and salt water, and freight, or sit tight until the ban is lifted.
“It’s one of the longest (stretches) since the spring of 2012. This is a long one,” agreed McKenzie County Commissioner Ron Anderson.
The immediate forecast doesn’t look promising for reopening the roads anytime soon, but six hours of warm sunshine, or even just a wind and no more rain could change that outlook in a hurry.
Counties post their road status on www.ndenergy.org.
Active rigs:

Active Rigs2584182187208

RBN Energy: update on propane - propylene processing plants. Before starting, a reminder, all single bonds, these are alkanes: 
  • CH4 = methane (C1)
  • C2H6 = ethane (C2)
  • C3H8 = propane (C3)
  • C4H10 = butane (C4)
On the other hands, alkenes have one double bond. Propylene/propene is the second simplest (after ethene/ethylene) member of the alkene class of hydrocarbons.

Now back to the RBN link:
Several new propane dehydrogenation (PDH) plants are coming online along the U.S. Gulf Coast.
Now developers in Alberta are making plans for the province to become the next hot spot for PDH plant development.
Final Investment Decisions (FIDs) are due over the next year or so on two projects aimed at taking advantage of the increasing volumes of propane being produced in western Canada—propane so plentiful, in fact, that they are paying to have it hauled off
But what if propane prices rise due to increasing U.S. demand, more exports and lower U.S. production?  What might such developments do to PDH economics?   What could make Alberta different? Today, we consider the drivers behind two (maybe three) prospective PDH projects in Alberta, and look at how they may affect the propane market on both sides of the 49th parallel.
We try not to play favorites among the hydrocarbon markets we blog about, but it’s hard not to like the propane sector, with its dynamic pricing, its variety of uses (heating, BBQ grilling, petrochemical feedstocks), its huge export potential, and the sometime remarkable differences between how much it costs at Point A versus Point B. As we have explained, propane is a “purity” product extracted from natural gas along with the other NGLs or (in smaller volumes) produced at refineries. 
Propane has three carbon atoms and eight hydrogen atoms (C3H8). We’ve written about propane frequently, and about propylene, a very in-demand petchem intermediary feedstock that for a long time was produced primarily by refineries or as a byproduct from ethylene steam crackers but more recently is increasingly being made “on purpose” at propane dehydrogenization (PDH) plants.
As their name suggests, PDH plants remove some hydrogen (specifically, two hydrogen atoms) from propane (again, C3H8) to make propylene (C3H6). The propylene molecule is significantly more reactive than propane, making it an ideal chemical building block.
Propylene is used in downstream petrochemical processes to make films, packaging and synthetic fibers. About two-thirds of propylene is used to make polypropylene--one of the best-selling plastics, second only to polyethylene. Polypropylene is used extensively in automobiles and in the manufacture of packaging films, bottle caps, fiber ropes as well as bicycle helmets and disposable diapers.
There are so many story lines here, one doesn't even know where to begin.

Yesterday it was reported that the Canadian government hopes to speed up the permitting process for crude oil and natural gas pipelines, suggesting that the Canadian government might be able to make a decision (yes/no/"we need more time") in only 27 months. Of course, that's better than the six years it took President Obama to make the decision to kill the Keystone -- another lost decade. Whatever.

But this is the story line I take away from this. If the industry waited for the government to act, no one would make any money, and at the end of the day, we would still be living in tar paper shacks. But free market capitalism (whatever is left in Canada and the US) finds entrepreneurs taking advantage (or finding workarounds) of the slow "progress" of their respective governments.

In this case, having maxed out takeaway capacity of natural gas, entrepreneurs in Alberta are looking for ways to solve the problem -- and one way: do the processing locally instead of shipping the raw product elsewhere.

By the way, how bad is takeaway capacity in Albert when it comes to natural gas? From the link at RBN Energy:
Then, through late 2014/early 2015, a combination of rising U.S. and western Canadian production of propane and a mild winter led to a propane glut, especially in Alberta, where in-province propane demand is modest and whose (equally modest) propane storage and (rail-based) take-away capacity are maxed-out. And when we say glut we mean it: in May and June 2015, spot prices for propane in Edmonton (light blue line in Figure 1) fell below zero several times—in other words, a bizarre-world in which propane “sellers” were actually paying “buyers to take the stuff off their hands.
Better living through chemistry. 

This One I Don' t Get At All -- In Most Recent EIA Report Obama Adminstration Says North Dakota Has 173 Active Rigs -- April 26, 2016

Put this note in this context: automobile manufacturers release monthly sales the first business day following the preceding month, and the results are usually released "first thing in the morning." For automobile sales for April, 2016, we should expect to see the results Monday, May 2, 2016.

In contrast, look at the "timeliness" of the EIA reporting. In the first screenshot below, note: the EIA reports that North Dakota had 173 active rigs "in 2014."

What can I say?