Tuesday, August 2, 2016

Liberty Resources Looks To Put As Many As 12 Wells On A Single Section In The Bakken -- August 2, 2016

Of note:
Case # (not file #) 25231, Liberty Resources, Beaver Lodge-Bakken, 12 wells on an existing 640-acre unit, s13-156-95; Williams 
Incredibly there were no permits or wells in this section -- until these 12 (permits have not been issued; this is simply a case requesting permission to place as many as 12 wells in this section).

The nearest well, is just to the west, in section 14-156-95::
  • 22513, 699, Hess, BL-Amelia 156-95-1415H-1, t12/12; cum 131K 6/16; 
From the very beginning I said if you have one well on your property, you will eventually have four, and possibly eight. It looks like "eventually" has arrived.

NDIC August, 2016, Hearing Dockets

August, 2016, NDIC hearing dockets.

Wednesday, August 24, 2016, five pages
25188, Hess Services, boiler location on a pad
25189, the Commission, treating plant for Newalta Environmental Services, Mountrail County
25190, Williston Exploration, Trac Mountain-Tyler, establish a 480-acre unit, allow the lateral of the Federal 2-13 well (#15209) to be extended into the SE/4 of said section 24; Billings County
25191, Samson Oil and Gas, Foreman Butte-Madison, establish a 1920-acre unit; 1 well, reduce minimum setbacks; McKenzie
25192, True Oil, Red Wing Creek-Madison, establish a 640-acre unit; 1 well, McKenzie
25193, Hess, allow the EN-Weyrauch C-154-93-2932H (#30301) to be drilled, completed, and produced; it was inadvertently drilled with the 7" intermediate casing and/or perforations short of the setback and/or spacing unit, Mountrail
25194, Hess, Ross-Bakken, three vertical wells on a 640-acre spacing unit, s24-156-92; injection of fluids in one of the vertical wells for the purpose of conducting a pilot enhanced oil recovery project, Mountrail
25195, Hess, Alkali Creek-Bakken establish an overlapping 2560-acre unit, 2 wells; and 11 horizontal wells to be drilled on a 1280-acre unit; Mountrail
25196, Hess, Truax-Bakken, establish a stand-up 2560-acre unit, 20 wells, Williams
25197, the Commission, appropriate spacing for wells completed in the Eightmile-Bakken pool in a 2560-acre unit; McKenzie, Williams
25198, the Commission, appropriate spacing for wells completed in the Heart Butte-Bakken pool in a 2560-acre unit; Dunn, McLean
25199, the Commission, appropriate spacing for wells completed in the Reunion Bay-Bakken pool in a 2560-acre unit; McKenzie, Mountrail
25200, the Commission, appropriate spacing for wells completed in the Cabernet-Bakken pool in a 2560-acre unit; Dunn
25201, Hess, pooling, Alkal Creek-Bakken, Mountrail
25202, Hess, Alkali Creek-Bakken, 12 wells on a 1280-acre unit, Mountrail
25203, Whiting, pooling Pronghorn-Bakken, McKenzie
25204, Whiting, pooling
25205, Whiting, pooling
25206, Whiting, pooling
25207, Whiting, pooling
25208, Whiting, pooling
25209, Whiting, pooling
25210, Whiting, pooling
25211, Whiting, pooling
25212, BR, pooling
25213, BR, North Fork-Bakken, 2 wells on an overlapping 2560-acre unit; McKenzie
25214, QEP, Heart Butte-Bakken, 12 wells on each of 4 1280-acre units; 4 wells on each of two laydown 640-acre units, total - 56 wells

Wednesday, August 24, 2016, supplement, one case
25237, Whiting, Glass Bluff-Bakken; wants to completed Gullikson 14-35H (#32042), was inadvertently completed above the top of the Bakken pool and outside the spacing unit sections 26/35-152-103, McKenzie County 

Thursday, August 25, 2016, seven pages
25215, Statoil, Bull Butte-Bakken, create 10 overlapping 2560-acre units; 1 well each; Williams
25216, Statoil, Hebron and/or Squires-Bakken, create 16 overlapping 2560-acre units; 1 well each, Williams
25217, Statoil, Squires, Painted Woods, Round Prairie, Todd, and/or Rosebud-Bakken, create 25 overlapping 2560-acre units; 1 well each; Williams
25218, Statoil, Lake Trenton-Bakken, create an overlapping 2560-acre unit, 1 well, Williams
25219, Statoil, Rosebud-Bakken, create 2 overlapping 2560-acre units; 1 well each, Williams
25220, CLR, Fairfield-Bakken, redefine field limits, Billings
25221, XTO, Whitetail-Bakken, redefine field limits, Billings
25222, CLR, Elm Tree-Bakken, i) six wells on an existing overlapping 5120-acre unit instead of an earlier authorization for four wells on smaller units; ii) 3 wells on an existing overlapping 3840-acre unit; McKenzie
25223, WPX, allow Emma Owner 23-14HX (#29446) to be drilled, completed, produced; inadvertently drilled and completely 157 feet from the south line of s23-150-94, McKenzie
25224, EOG, Stanley-Bakken, create an overlapping 1280-acre unit; multiple wells; Mountrail
25225, the Commission, treating plant, Billings County
25226, the Commission, treating plant, Williams County
25227, XTO, pooling
25228, XTO, pooling
25229, XTO, Antelope-Sanish, 11 wells on an existing 1280-acre unit, McKenzie
25230, Newfield, pooling
25231, Liberty Resources, Beaver Lodge-Bakken, 12 wells on an existing 640-acre unit, Williams
25232, EOG, commingling
25233, EOG, SWD
25234, WPX, commingling
25235, CLR, commingling
25236, Henry Hill Oil Services, SWD

Friday, August 26, 2016, two cases, both continued cases:
25142, Vintage vs CLR, risk penalty legalese
24687, Enerplus, Antelope-Sanish, establish a 640-acre unit; 4 wells; section 16-152-94, McKenzie

Six New Permits; Seven Permits Renewed; One Producing Well Completed; One Well Recompleted -- August 2, 2016

Active rigs:

Active Rigs3474194179207

The August 2016 hearing dockets have been published.

Six new permits:
  • Operator: CLR
  • Field: Bear Creek (Dunn)
  • Comments: all six permits in s23-147-96
Permits renewed:
  • EOG (3): three Hawkeye permits in McKenzie County
  • Emerald Oil (2): two D Annunzio permits in McKenzie County
  • Statoil: a Martin permit in Williams County
  • Enerplus: a Wallaby permit in McKenzie County
Mountain Divide canceled four permits in Divide County.

Petroshale canceled one permit in McKenzie County.

One producing well completed:
  • 29685, 2,068, Statoil, Richard 8-5 XW 1TFH,
One well recompleted:
  • 07934, Petro-Hunt, Anna Osadchuk B-1, it looks like this Duperow well was recompleted as a a Madison well

MDU Earnings -- 2Q16; Construction Materials Sets Record Quarterly Earnings; Leads MDU Earnings; With Discontinued Ops, Co Loses 56 Cents/Share

From SeekingAlpha:

  • MDU Resources: Q2 EPS of $0.24 beats by $0.03. 
  • Revenue of $1.04B (+10.9% Y/Y) misses by $30M.
Press release:
  • Construction materials has record second quarter earnings of $33.7 million, up 67 percent driven by higher margins and 9 percent revenue growth due to higher product volumes and construction workloads. 
  • Construction services backlog up 18 percent to $508 million.
  • Pipeline and midstream segment earnings increase with 139 percent rise in natural gas storage volumes.
  • Electric utility earnings up 36 percent, driven by regulatory rate relief; natural gas distribution earnings impacted by unfavorable weather.
  • Completed the exit of E&P business and sold interest in the refining business.
Second quarter earnings from continuing operations of $46.1 million, or 24 cents per common share, compared to earnings from continuing operations of $25.8 million, or 13 cents per common share for the second quarter of 2015. Including discontinued operations, the exploration and production and refining businesses, the company reported a loss of $109.3 million, or 56 cents per common share for second quarter 2016, compared to a loss of $229.8 million, or $1.18 per share for second quarter 2015.

Forecast was for 21 cents/share earnings. 

Gasoline / Diesel Sales In California Surging Past Few Months -- John Kemp -- August 2, 2016

I've often said that if I had only metric to evaluate the health of the economy, I would choose gasoline sales.

It is interesting to note the rise in gasoline and diesels sales in California over the past few months:

Many story lines in those two graphs, but enough for now.

Back To Her Chores

Now that she is on the mend, Sophia has been getting back to her daily chores.


Hurricane "Drought" Sets New Record -- Scientific American -- July 2, 2016

Must be all that global warming. By the way, this was "predicted" by the tea leaves that John Kemp has been posting for the past year. This really is quite amazing. It's not just there have been no major hurricanes in the Gulf this year, but there have been NO hurricanes at all in the Gulf in the past three years. Makes one wonder, doesn't it.
That is the longest streak in the past 130 years, since formal record-keeping began in 1886.
Despite the fact that this is the longest streak in 130 years -- since formal record-keeping began in 1866, the folks who constantly warn us about global warning -- say that "this is not unusual."
The article did not mention "global warming."

Guaranteed: we get one severe hurricane this year, and journalists will "blame" manmade global warming.
General Mills Flour Recall 

About three weeks, I forget the exact day, I picked up a 5-lb bag of Gold Medal all-purpose flour. When I brought it up to the counter, it would not "ring up." The cashier did not understand why; a quick conversation with Albertson's manager solved the problem: all Gold Medal flour had been recalled.

It happened so quickly, they didn't even have time to put up a sign on the shelves. It was electronically "managed" until store employees could get around to posting notices of the recall.

I didn't give it any thought until I saw this AP article over at Yahoo!Finance. What amazes me is how epidemiologists can identify the cause.

Mutation: Deus Ex Machina

I am quite happy to have read John Hands' CosmoSapiens. I'm not quite sure what drove him to write such a book, and I'm not sure if he can be "pigeon-holed." But I'm pretty sure he and Richard Dawkins are not drinking buddies.

For guys like Richard Dawkins, it's all about the gene (The Selfish Gene, e.g.).

Not only is John Hands not so sure, he lays out a pretty case that the "jury is still out." Up until a few years I was solidly in Richard Dawkins' camp -- although I detest his methods.

But now, after reading John Hands, I see things quite a bit differently. Some argue that mutations are fairly rare in somatic cells, and even rarer in germ cells.

I was reminded of that when reading the very short -- two pages -- review of a short book, Why Only US: Language and Evolution, by Robert C. Berwick and Noam Chomsky.
When Chomsky entered the field of linguistics it was widely assumed that the human mind began life as a blank slate, upon which later experience was written. Accordingly, language was seen as a learned behavior, imposed from the outside upon the infants who acquire it. This was certainly the view of the renowned behavioral psychologist B.F. Skinner, and the young Chomsky gained instant notoriety by definitively trashing Skinner’s 1957 book Verbal Behavior in a review published in the journal Language in 1959. In place of Skinner’s behaviorist ideas, Chomsky substituted a core set of beliefs about language that he had already begun to articulate in his own 1957 book, Syntactic Structures.
In stark contrast to the behaviorist view, Chomsky saw human language as entirely unique, rather than as an extension of other forms of animal communication. And for all that humans were notoriously linguistically diverse, he also insisted that all languages were variants on one single basic theme. What is more, because all developmentally normal children rapidly and spontaneously acquire their first language without being specifically taught to do so (indeed, often despite parental inattention), he saw the ability to acquire language as innate, part of the specifically human biological heritage.
Delving deeper, he also viewed most basic aspects of syntax as innate, leaving only the peripheral details that vary among different languages to be learned by each developing infant.
And then the mutation, a deus ex machina:
Berwick and Chomsky go on to suggest that the biology underwriting the Merge operation emerged as the result of a “minor mutation” in a member of an early modern human population. As judged from the archaeological record, this event occurred in East Africa some 80,000 years ago, and it produced a neural novelty that could yield “structured expressions” from “computational atoms” to provide a “rich language of thought.”
Only at a later stage was “the internal language of thought…connected to the sensorimotor system” that makes speech possible. In human evolution, then, the existence of language for thought preceded that of spoken language: a currently controversial idea, albeit with a respectable pedigree that traces back to the writings of John Locke in the eighteenth century.
Of course, there is no proof of that "minor mutation" and one can safely say there never will be. 

Suggesting that the development of language was "the result of a minor mutation in a member of an early modern human population" would certainly catch John Hands' attention. 

"A minor mutation" explains everything. Sort of like Rudyard Kipling's Just So stories.

US Auto Sales Decline In July. But Collectively, GM Had Best July Retail Sales Since 2007 -- August 3, 2016

From The Detroit News:
The automotive industry’s hot auto sales cooled off in July.
Ford Motor Co. on Tuesday said its July sales fell 2.8 percent compared to the same month a year ago, while crosstown rival General Motors Co. said sales fell 1.9 percent. Fiat Chrysler Automobiles reported a slight gain of 0.3 percent.
FCA, which recently switched its sales reporting practices, said it sold 180,727 vehicles compared to 180,124 the same period a year ago. It was driven by its Jeep and Ram brands, which rose 5 percent each. Chrysler sales fell 4 percent, Dodge sales fell 10 percent, and Fiat sales fell 14 percent.
Sales rose at all GM brands except for Chevrolet, which saw a 5.3 percent sales dip. GM’s brands collectively had their best July retail sales performance since 2007, the company said.
Meanwhile, US consumer spending rose 0.4% in June for second month in a row

Spin from The Huffington Post: ObamaCare getting more expensive but still cheaper than predicted. Wow.

We "May" See $50 Oil Next Year -- August 2, 2016

Lead link for the day: I've opined on numerous occasions that ObamaCare is one of three reasons why the US economy is doing so poorly. Don sent me this link a couple of days ago, in Forbes magazine: Is ObamaCare blameless in the weakest recovery since 1949?
It’s official. In terms of average annual growth, the Wall Street Journal reports that the pace of the current Obama recovery ”has been by far the weakest of any since 1949.” Since the recession officially ended in 2009, GDP has grown by an anemic 2.1% a year.
That’s less than half the 4.3% average annual growth during the Reagan recovery.
Indeed, Tyler Durden has pointed out that President Obama is now on track to “be the only president in history to never have a year of 3% GDP growth. That is truly abysmal economic performance."
Yet Hillary Clinton apparently believes it’s a good idea to double down on Obamanomics by running for Obama’s third term.  
Back To The Bakken
Active rigs:

Active Rigs3474194179207

RBN Energy: update on Canadian oil sands after the wildfires -- an incredible story, to say the least.
Three months after a series of devastating wildfires wreaked havoc in Alberta’s oil sands region, production is essentially back to normal. Temporary shutdowns at several production sites initially reduced the oil sands’ output by more than 1 MMbbl/d –– or about one-third the area’s pre-fire production level –– which trimmed inventories and goosed world oil prices. But the short-term closures appear to have had little effect on the Canadian and U.S. refineries that process oil sands-sourced crude. Now, oil sands producers (stung more than many by the collapse in oil prices) are focused again on reducing production costs in an effort to stay profitable in a low-oil-price era. Today, we summarize the current, post-wildfires state of oil sands production and consider the region’s future in the new, tight-oil/Shale Revolution world.
The series of wildfires that swept through parts of Fort McMurray, AB and nearby oil sands production areas in early May 2016 caused damage totaling an estimated Canadian $3.6 billion (the equivalent of more than U.S. $2.7 billion), making the event the most expensive natural disaster in Canada’s history (by far, according to a July 2016 report by the Insurance Bureau of Canada). As we said in our initial look at the wildfires’ impact on oil sands production in mid-May, the wildfires consumed hundreds of thousands of acres (ultimately, more than 1 million acres had burned by the time the last, spotty fires were put out the first week of July) and forced tens of thousands of people from their homes. That spurred staffing shortages at many oil sands production facilities, prompting production scale-backs and a handful of temporary production shutdowns.
As fierce and as far-reaching as the wildfires were, however, they didn’t cause any major damage to the oil sands production areas themselves, or to the pipelines that bring diluent in (to add to bitumen to improve its flow-ability) and crude oil out. Some pipeline flows were interrupted, though, and there was some damage to the electric grid ––but fortunately not enough to slow the rebuilding of oil sands production over the following few weeks.
Remember all that talk about $60 oil by the end of the year. It now looks questionable if we will even hit $50 next year. From Bloomberg: crude oil may rebound to $57 next year. That is incredibly bad news for the Mideast. Saudi Arabia cannot survive on $57 oil, and "may" is the operative word.
Progress will be slow. The crude glut will take a long time to dissipate, meaning only gradual price gains, said Michael Hsueh, a strategist at Deutsche Bank AG. West Texas Intermediate, the U.S. benchmark, will average $49.50 in the fourth quarter before breaking decisively above $50 next year.
Rizone has a nice article that brings us up to date on Russia's efforts to find new oil and natural gas markets in China, India, and southeast Asia. Many, many data points
  • India is the world's #3 consumer of oil, consuming 4.2 million bopd in 2015
  • Russia's largest crude oil market is the Netherlands (yes, no typo)
  • Russia's second largest crude oil market is China (no surprise); currently 15% of Russia's output ends up in China
  • China will compete the CNPC Mohe-Daqing oil pipeline in 2017; will make it easier for eastern China to access Russian crude oil
  • Russian gas sales are set for tremendous growth after Russia / China signed major supply agreements in 2014 and 2015, and again 2016 when an MOU was signed to cooperate on building underground gas storage and gas-fired power generation facilities in China
The TrainWreck


August 3, 2016: New Jersey premiums may go up 5 to 26%.

Later, 8:39 p.m. Central Time: CNN's headline -- nation's largest insurer, Aetna, latest insurer to question ObamaCare's future
Aetna is reconsidering its participation in Obamacare, making it the latest large insurer to cast doubts on the future of the individual exchanges.
Aetna said Tuesday it is canceling plans to expand into five more states next year and will reassess its involvement in the 15 states where it currently offers coverage on the individual exchanges.
Aetna -- which expects to lose $300 million (pre-tax) on its Obamacare business this year -- must conclude its review by the end of September and notify states where it intends to withdraw.
Original Post
For some odd reason, there were many, many ObamaCare stories today; I assume we will see more of these stories as insurers announce new premiums for 2017. Premiums will be set in August, I believe for open season to begin in November (I may have the dates wrong, but something like that).

First this story from The Wall Street Journal: two more health co-ops sue over ObamaCare's risk-adjustment formula

From The Chicago Tribune: rates in Illinois may go up 45%.
Blue Cross Blue Shield of Illinois, the most popular insurer on the state's Obamacare exchange, is proposing increases ranging from 23 percent to 45 percent in premiums for its individual health-care plans, according to proposed 2017 premiums that were made public Monday. The insurer blamed the sought-after hikes mainly on changes in the costs of medical services.
Ultimately it will be insurers setting the rates that will take effect January 1, 2017. Illinois, unlike a number of other states, doesn't have the power to reject the proposed rates outright, said Dena Mendelsohn, a staff attorney at Consumers Union, the advocacy and policy division of Consumer Reports.
Then this huge story, also from The Wall Street Journal: Aetna joins rivals in projecting loss on AbamaCare. That's the headline, but it understates what really may happen: "Aetna will review how it will continue its public exchange business in existing states." Not good news.
Aetna Inc. became the last of the five major national health insurers to project a loss on Affordable Care Act plans for 2016, and the company said it would re-evaluate its participation in the business and cancel a planned expansion.
Aetna, which had previously expressed relative optimism about the ACA exchanges, said it was setting up a reserve of $65 million to account for expected losses on individual plans over the rest of 2016. The move, coming after a similar shift in tone last week by Anthem Inc., is the latest sign of instability and financial pressures in the marketplaces that are at the heart of the health law.
And the stories continue. 
Also from The Wall Street Journal, but re-printed over at Fox News: former Obama adviser -- how I was wrong about ObamaCare. Another 2016 Geico Rock Award nominee?

Spin from The Huffington Post: ObamaCare getting more expensive but still cheaper than predicted. Wow. 

Florida Could Be Under 6 Feet Of Water By End of Century -- Zillow

Looks like Zillow needed some "free press" -- this is so beyond the pale, it is laughable. It's bad enough Zillow went down this road, but then seeing who posted the story (Bloomberg) it is not surprising. [Apparently even Yahoo!Finance thought this story was laughable; early this morning this story had a headline position; then it was moved well down the page. Now, it's so far down the page the story is lost in all the chaff.
Rising sea levels could soak homeowners for $882 billion, according to a new report from real estate website Zillow. The research takes its initial cue from the journal Nature, which in March found sea levels could rise more than 6 feet by the end of the century. In that scenario, Florida could lose close to 1 million homes, or 13 percent of the state’s current stock. That comes out to $400 billion in value—a figure that doesn’t include losses to commercial buildings or public infrastructure or account for future appreciation in home value.

Zillow combined its own home price estimates with sea level projections from the National Oceanic Atmospheric Administration. There’s still a lot of guesswork going on, cautions Zillow Chief Economist Svenja Gudell. Governments could build barriers to protect coastal communities or sea level rise could prove more moderate. But whatever the variables, there will be major losses as the waters move in.
Even in Zillow's less calamitous scenario of a 2-foot increase in sea level, the U.S. would still lose $74 billion in home value, with Florida leading the way at $17 billion.
Meanwhile, four legitimate peer-reviewed scientific articles have concluded there has been no evidence of any rise in sea levels, anywhere, due to manmade global warming.