Wednesday, April 11, 2018

Tentative Release Of Director's Cut This Month -- This Week -- April 11, 2018

This is quite incredible. Earlier this week "we" posted a story about the housing shortage in Williston. Now, tonight, Don alerts me to this story: "oil industry affects Stanley housing market." Link here:
More than half of the homes on the market are selling higher than the assessed value.
In 2017, the city assessor had 54 home sales - that compares with only 38 in 2016.
"Some of the older homes are staying on the market a little bit longer maybe 3-4 months but there's a good turnover in sales," said Susan Spaeth, Stanley City Assessor.
She adds that many of the people putting their homes up for sale aren't necessarily leaving town.
Several are upgrading to newer or bigger homes in the area.
Director's Cut To Be Released At The End Of The Week

From the NDIC site: the monthly Director's Cut is scheduled to be released this Friday, April 13, at 1:30 p.m. CDT.

So, What's Going On In Peru?

Canadian Prime Minister is on his way to Peru (probably already there). Now, it is being reported that Ivanka Trump is headed to Peru.

Ah, here is it is the Summit of the Americas in Lima, Peru; the US delegation led by Vice President Mike Pence.

For Trudeau, apparently more important than the Trans Mountain pipeline project.

If Accurate -- Wow! Sinopec To Slash Crude Imports From Saudi Arabia -- -- April 11, 2018

Link here. Forty days and forty nights.
China’s Sinopec, the largest oil refiner in Asia, will shut down its biggest refinery for a major overhaul starting May 1. This will coincide with a period in which Sinopec will have slashed its Saudi crude oil imports by 40 percent after the Saudis unexpectedly raised the official selling price of their flagship Arab Light crude oil for Asian customers.
Sinopec will close for around 40 days beginning May 1 its 460,000-bpd refinery and the whole ethylene complex of Zhenhai Refining and Chemical Company in the eastern coastal province of Zhejiang, one of China’s largest facilities that process Saudi crude oil, Reuters reported on Wednesday, citing an industry source briefed on the issue.
The good news: Brent crude oil is surging -- from $68 to $72 for Brent, literally in less than a week. The bad news: incoming missiles are targeting Saudi Arabia's refineries and oil terminals.

Is The Cushing Hub Relevant Any More?

Of course it is. Perhaps just "less" relevant.

Link here, again,
  • for multiple reasons, operators are "rushing" crude oil to the refineries and terminals along the Gulf Coast as fast as they can
  • crude oil out of the Permian is overwhelming the system; and a nexus search for the Permian yields: bottleneck
  • with the DAPL, Bakken oil is now bypassing Cushing and going directly to midwest refineries and/or to points east and south, but not Cushing
Remember all those posts about a shortage of storage capacity at Cushing?

The good news for Cushing: surging production from STACK and SCOOP.


From the LA Times:
In August, the county Board of Supervisors approved a $550,000 pilot program to build a handful of small backyard houses, or upgrade illegally converted garages, for homeowners who agree to host a homeless person or family. Then in February, Bloomberg Philanthropies awarded L.A. a $100,000 Mayor's Challenge grant to study the feasibility of backyard homeless units within the city limits.
Rents under the county's pilot program would be covered by low-income vouchers, with tenants contributing 30% of their incomes. The county is also sponsoring a design competition, streamlining permits and providing technical aid and financing options.
Because our younger daughter lives in Portland, OR (Multnomah County) I am familiar with this program. Portland/Multnomah County is trying the same thing; I assume that's where Los Angeles came up with the idea.

I don't know how long Portland's program has been in effect, but I think it's been less than two years. From the article:
Multnomah's model probably won't work on a large scale, she said, although the county's pilot program is ongoing and officials are looking at alternatives.
It's a long, long article -- it provides a snapshot of just how incredibly difficult the homelessness problem is.

So many story lines.

1. Population
The homeless population in Los Angeles: 55,000. Including Pasadena, Glendale, and Long Beach, which accomplish their own homeless counts, the total is 58,000
  • Los Angeles, population: 3.98 million
  • Pasadena: 142,000
  • Glendale: 200,000
  • Long Beach: 470,000
  • homeless rate of 0.4% in the latter three cities
  • homeless rate in Los Angeles: 1.4%
2. Taxation: somewhere between $1.2 billion and $4.6 billion --
LA city voters agreed to tax themselves $1.2 billion for homeless housing, but units can cost $350,000 apiece and are largely for disabled people. It will take years to reach the goal of 10,000 new apartments.

However, this article in the LA Times, dated February 1, 2018 said the tax was much higher:
Over the last 16 months, voters have agreed to tax themselves $4.6 billion to build housing — 10,000 units in 10 years — and provide supportive services for homeless people.
3. The math. $4.6 billion / 10,000 units = $460,000 per unit; the units are less than 500 square feet; an example in the article: 150-square-feet. Or $5 billion / 50,000 homeless = $100,000 per homeless person.

4. Getting worse in LA. According to the February 1, 2018, article:
If you took out Los Angeles, national homelessness would have dropped last year for the first time since the recession.  
The problem has only gotten worse since Mayor Eric Garcetti took office in 2013 and a liberal Democratic supermajority emerged in 2016 on the county Board of Supervisors.
The number of those living in the streets and shelters of the city of L.A. and most of the county surged 75% — to roughly 55,000 from about 32,000 — in the last six years.
[Indications are that Mayor Garcetti will be running for US president in 2020. This week Garcetti is in Iowa.]
5. Overwhelmed with interest. From the more recent linked article:
It's very early to gauge the possible scope of the backyard units for homeless people, but residents who have heard about it are intrigued. [My hunch: the writer of this article struggled to find the right word to use before settling on "intrigued."]
"We were overwhelmed with the interest," said Larry Newman, manager in the Economic and Housing Development Division of the county's Community Development Commission.
How intrigued? Remember, the interest was described as overwhelming:
About 100 of the 500 homeowners the county initially contacted responded with interest, and the county is in the process of whittling down 27 qualified applicants who are ready to build to a list of six finalists, according to a county document.
So, from the standpoint that the city was only looking for six "finalists," finding 27 "qualified" applicants from a pool of 100 out of a larger pool of 500, I suppose one could say the response was overwhelming. I can only imagine the time required to "audit" 100 applicants to find 27 that were qualified, and then select the six sites.

$4.6 billion. $350,000/unit. 58,000 homeless people. Six sites to be selected.

6. Red tape:
Providing backyard housing for homeless people won't be easy. Multnomah County, Ore., which includes Portland, ran into tax, liability and regulatory issues with its homeless granny flat pilot program.
7. Spin. From the first linked article:
"We don't put a house on a block unless everyone on the block stays good with it," said [one advocate of the program]. "We know NIMBYism is a force to be reckoned with, and we don't want to allow any negative pushback to build."
"A force to be reckoned with." Euphemism for court fights. All it takes is one homeowner in a neighborhood to tie this up in court.

Four New Permits -- April 11, 2018

Active rigs:

Active Rigs59533193190

Four new permits:
  • Operators: XTO (3); Liberty Resources
  • Fields: Hofflund (Williams); Enget Lake (Mountrail)
  • Comments: XTO has permits for a 3-well Lonnie Federal permit in NWNE 3-154-95
No oil and gas permits were renewed, but four SWD well permits were.
  • Comment: it's not often I see permits -- new or renewed -- for SWD wells. It confirms all the recent articles about the increasing amount of "produced water" coming out of the Bakken.

US Shale Crude Oil Midstream -- The Red Queen Re-Surfaces -- April 11, 2018

During the early years of the Bakken boom, folks talked about the "Red Queen." The argument was that North Dakota had to keep drilling more and more wells just "to keep up." We haven't heard much about the Red Queen. There appears to be an inverse relationship between "Red Queen" hysteria and the number of DUCs.


Now, the "Red Queen" has apparently gotten off one treadmill and gotten on another. The new treadmill is the "midstream" or "pipeline" treadmill. Anyone following the blog and/or following RBN Energy is well aware of this issue.

Now, we have a short article from Bloomberg via Rigzone that tries to quantify how much this build-out is going to cost: $170 billion over the next seven years. Data points:
  • gas output will expand by 24 billion cubic feet, or 32 percent, through 2025 from last year
  • to support that growth, the country’s gas industry needs to spend $170 billion over the next seven years on pipelines, compressor stations, export terminals and other related infrastructure [see source at link]
  • the Permian Basin, know for its oil-rich layers of rock, is facing the threat of having to slow down the output of crude because drillers lack capacity to handle all the the gas that’s flowing as a mere byproduct [the very problem the Bakken had]
  • for companies building multibillion-dollar plants to chill gas into liquid and ship it abroad, the abundance of cheap gas from the Permian in West Texas is an advantage
  • developments there “will happen” because it’s an environment supportive to energy infrastructure
  • that may not happen fast enough for Appalachia [again, according to the expert at the link]

National Test Scores Being Released Today -- April 11, 2018

North Dakota test scores pretty much unchanged from two years ago. Worst news: North Dakota 8th graders scored below the national average in reading in 2017, and barely scored better in any comparison, although NAEP ranks ND "much higher" in most (all?) categories. Link here for this screenshot:

Full data here. Interactive. State-by-stage. Year of Survey. Grade level. Mathematics and reading. Easy to navigate. Make sure you are looking at correct year when going through the interactive page.

The Market, Energy, And Political Page, T+42 -- April 11, 2018 -- FWIW: Atmospheric CO2 Leveling Off

US crude oil production, link here: records keep being set -- two full months (February/March - 2018) of 10 million bopd + crude oil production and each week has seen a new record (with one very, very minor exception):

Weekly petroleum report, link here:
  • US crude oil inventories: inventories surge; up 3.3 million bbls; at 428.6 million bbls
  • refineries: operating at 93.5% of their operable capacity
  • all the rest, background noise
  • re-balancing in the US: not going to happen
  • gasoline, days of supply: overall trend coming down (decreasing) -- now around 25 days; much better than the 33 days one year ago, March 31, 2017
Crude Oil Production By Region

Atmospheric CO2

The global economy is "hotter" than ever, and atmospheric CO2 -- FWIW -- is leveling off. 

Compare with April, 2017, link here:

In April, 2016, link here:

The Apple Page

Apple: practically every teenager surveyed, owns an iPhone; practically every teenager plans to buy an iPhone -- if one defines 80%+ as "practically everyone" -- regardless, the numbers are incredibly impressive. Remember: iPhones are "high end" gadgets. Apple does not sell "low-end" smartphones.

From Macrumors:
The iPhone continues to be the most popular smartphone by far among teens, according to new data gathered by investment firm Piper Jaffray for its most recent semiannual teen survey in the United States.

82 percent of teens surveyed own an iPhone, up from 78 percent in the fall of 2017, while 84 percent of teens expect their next phone to be an iPhone, up from 82 percent in fall 2017. Teen ownership and interest in iPhone has grown steadily over the past several years.  
This will affect the entire Apple ecosystem. Proof? See statistics for the Apple Watch at the same link.

Let's see the comments (154, so far):
  • why would anyone in the world compare students' interest in $300 Apple Watch vs $50,000 Patek Philipe? great question
  • 11-year-old niece wants an iPhone; her friends all use iPads and iPods
  • students with Apple Watches -- many of them likely to be hand-me-downs from parents (yup)
  • Apple should launch its own version of "Facebook" (agree completely)
The only question: with Apple smart phones being high end gadgets, where was the survey done? How were likely respondents identified?

Steady Eddy -- Random Update Of An Old Madison Well --- April 11, 2018

The well, drilled back in 1978, now almost 40 years old:
  • 6727, 110, Scout Energy Management, LLC, Witherstine, W. H. 3; Wiley oil field, Madison pool, unitized; t12/78; cum 417K 2/18;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

Wells I No Longer Follow -- April 11, 2018

This is simply some housekeeping. Nothing new here. This has all been posted before. The page where this came from was getting too long. These are wells that I was watching for some reason or other; once I saw what I wanted to see, I "closed" them out.

For wells still being followed, click here.

Page 8

June 29, 2018: check production data; and frack data: #33120, #33121; they come off confidential list August 25 and August 27, respectively

November 23, 2017: follow up in three to six months; this well was fracked 1/7; had a great frack; then struggled; looks like it might be producing nicely as of 6/18 --
31999, 2,004, BR, CCU Zephyr 14-34 TFH, Corral Creek, t3/17; cum 73K 6/18; challenges? (2/18); as of 7/18 seems to be fixed;
November 23, 2017: watch this one in three to six months --
  • 32325, AB/67 (no typo), Hess, EN-Freda-154-94-2635H-1, Alkali Creek, t9/16; cum 5K 9/17;
September 15, 2017: work on pad being that might affect this well: 21682; was off-line 7/17. Remains off-line 5/18; came back on line for two days in 6/18; update here; halo effect;

January 13, 2018: #25374; watch this one go over 1 million bbls; still no pump;  as of 2/18: still no pump; 990K 4/18; 6K/month; updated June 30, 2018;

January 13, 2018: #24180; see this post; near recently fracked well; initial bump but then dropped back; follow for a couple of more months (2/18);

December 22, 2017: at this post, check two wells:
  • #26737: recently put on gas lift; compare new production data after gas lift put in; a lot of folks are getting excited about gas lift
  • #24532: production for October, 2017, is an error; it has been corrected
December 1, 2017:  note production profile 10/17; probably taken off-line to put in a pump;
  • 30833, 630, XTO, TAT State Federal 14X-36G, Bear Creek, t6/17; cum 113K 6/18; production has come back nicely; follow one or two months (2/18);
November 27, 2016: 17120, EOG, Austin 10-34H; t8/08; 999K 6/18; a short lateral; 24 days in 3/16; check reason for bump up in 9/16; was off-line during the summer; [update: it was taken off-line while neighboring wells were being fracked. Yes, neighboring frack positively impacted this well.] A graphic of this area has been completed; posted for a few minutes and then placed in draft status.  Brought back up. I'm keeping this one here until it hits 1 million bbls; will be awhile.

September 12, 2014: a failed frack; will it be re-fracked? update at this post;
  • 27635, 137, Slawson, Matilda Bay 1-15H, Stockyard Creek, 8 stages; planned for 24, mechanical problems; 600,000 pounds proppant; single section spacing, fracked May 22 -23, 2014, according to FracFocus; t6/14; cum 44K 11/16; went off-line middle of July, 2014; then began producing again 10/14; production up markedly, November, 2014 through January, 2015; as of 9/16, no new frack; API 33-105-03404; off-line as of 9/17; back on line as of 2/18;
August 28, 2017: check #19960 (tracked here), #18189 at end of 2017. Neighboring wells just fracked (31199, 31200, 31201, 31202)
  • 31199, 1,838, XTO, Kaye Federal 13X-3H, Lost Bridge, t5/61 (sic, probably 6/17); cum 125K 3/18; (#19960, #18189); update here, #19960 with huge jump in production; #18189 still off-line; #19960 with huge jump -- see update here; yet to see what #18189 will do; most recent update, 12/17; update: #18189 is back on status; a jump and then a decline; back off-line as of 1/18; #19960 is back on-line; tracked here; time to remove from this list;
August 22, 2017: #18514, #21458, #23176 -- watch for increased production sometime in 2018;

November 28, 2016: an incredibly good well abandoned by Oasis after leak; #22100, AB/IAW/1,317, Oasis, Achilles 5301 41-12B, Baker, t2/12; cum 187K 1/15;

November 29, 2014:
26929, AB/IAW/133, EOG, Wayzetta 148-0311H, Parshall, Three Forks NOS, 1920 acres; target: "E section of the Three Forks; middle Bakken with good shows and a thickness of 47 feet; background gas units were unremarkable, peaking at less than 700 units; near the end of the lateral, the wellbore brushed the lower "F" marker; 47 stages; 14.8 million lbs sand, but not much production, t6/14; was inactive 8/14 - 11/14; back on status 12/14; cum 15K 1/16; [Update: 6/15 - this well is back on "A" status after having a NGL stripper skid put in place in 12/14][Update: 11/15 -- back on IA status; 12/15 back on active status for one day; 1/16 -- off-line; IA as of 1/16; remains IA through 9/17;] noted to be AB 5/18;
January 25, 2018: a reader tells me the Kennedy and Miles wells in Dimmick Lake (33220 - 33227) are being fracked this week. SI/NC as of 3/18; they've started to produce 5/18; and, FracFocus says they have been fracked.

July 26, 2016: a year from now, check if this well ever gets back on-line; for now, this third bench TF well is a bust:
  • 27453, AB/IAW/54, CLR, Hartman 5-28H3, 30 stages; 2.9 million lbs, t1/15; cum 1K 1/15; abandoned after 8 months of minimal production; nothing in the file report to suggest why;
July 28, 2015: went inactive in March, 2015, in March, 2015 -- application for Stripper Well Status:
  • 19542, AB/IAW/IA/30, EOG, Austin 102-05H, Parshall, Bakken, t1/11; cum 36K 5/15;
March 25, 2018: these Beaks wells all completed; and yet, most of them were taken off-line January, 2018: 19289, 29853, 29852, 29851, 26430, 26432, 32820. As of 4/18, all back on line and production not out of the ordinary.

January 17, 2018: #17200 -- BR -- why did production increase a bit in 11/17; this well is tracked here;

March 9, 2018: 33534, MRO, Bronett, IP, 5,113. See #33400 down below, also.  Update this post.

March 16, 2018: #18905; Bruin; huge well; off-line due to fracking nearby; check in one to two months; update here

April 19, 2018 : see this link; update here;
  • wells that might be interesting to check on in a few months:
    • 17008, 298, MRO, Myrmidon 1-2H, Antelope, Sanish, t8/08; cum 56K 2/18; off-line since 5/17;
    • 33491, 4,125, MRO, Shoots USA 41-2H, Antelope, Sanish, t4/18; 80K after one month;
    • 33492, 6,637, MRO, Mamie USA 21-1TFH, Antelope, Sanish, t4/18; cum 59K after only 21 days;
    • 18471, 380, MRO, Hunts Along USA 12-1H, Antelope, Sanish, t1/11; cum 139K 2/18; off-line since 5/17; back on-line 3/18;
    • 32865, 3,634, MRO, Demaray USA 41-2TFH, Antelope, Sanish, t4/18; cum 36K after 15 which extrapolates to 72K for one full month;
April 22, 2018: #29033, #29034 in a couple of months; nearby wells recently fracked (2/18); update here;

January 22, 2018: #17200; neighboring well recently fracked; bump in production; see what it is in a month or two; see this post.

October 22, 2017: #31476 was just fracked (huge well); #24011 remains off-line -- check this one to see if there if any jump in production; tracked here. Back on line but not much production, 1/18; nice production in 2/18; #24011 back on line as of 2/18; not much of a bump but a nice well.

March 13, 2018: #30252; after being completed and reported, CLR put it back on conf status; have not seen that before; turned out to be a huge well; 42K in 3/18; production data here;

December 28, 2017; #31111, #31110, #31109 -- these were all PNC'd -- watch IPs for these -- right next to a huge monster well, #19296.

November 22, 2017: follow-up on these two wells in three to six months: (#16964, #20321); parents of newly fracked wells; see this post; #16964 -- huge jump in production; re-fracked 8/17; re-frack with 45 stages; 5.5 million lbs; see update of #16964 at this link;

August 28, 2017: check #19960, #18189 at end of 2017. Neighboring wells just fracked (31199, 31200, 31201, 31202)
  • 31199, 1,838, XTO, Kaye Federal 13X-3H, Lost Bridge, t5/61 (sic, probably 6/17); cum 56K 9/17; (#19960, #18189); update here, #19960 with huge jump in production; #18189 still off-line; #19960 with huge jump -- see update here; yet to see what #18189 will do; most recent update, 12/17; update: #18189 is back on status; a jump and then a decline; back off-line as of 1/18; #19960 is back on-line; tracked here; time to remove from this list;
October 4, 2017: check monthly production data on these wells; now tracked here:
  • 29630, 5,644, MRO, Clarice USA 14-9H, Bailey, 45 stages, 8.3 million lbs, t9/17; cum 145K 11/17: -- a 73K month, 9/17;
  • 29631, 3,070, MRO, Delia USA 14-9TFH, Bailey, Three Forks B1, 45 stages; 8.1 million lbs, t8/17; cum 11K over 6 days -- extrapolates to 56,385 bbls over a 30-day month; cum 115K 11/17; a 45K-month, 10/17;
  • 29634, 4,048, MRO, Double H 34-8TFH, Bailey, Three Forks B1, 45 stages, 8.1 million lbs, t9/17; cum 102K 11/17; a 44K-month, 9/17;
September 19, 2017: #18114; see this post.

September 17, 2017: #19973, neighboring wells fracked 6/17; this well taken off-line 6/17; WPX, Rachel Wolf, Squaw Creek; updated October 19, 2017; huge wells; halo effect. See how long halo affect lasts. Still obvious 12/17; looks like halo effect still as of 1/18 - but only 11 days of production in 1/18; only 10 days in 2/18; this well is now tracked here

February 28, 2017: EOG wanted to abandon this well due to pump failure and low commodity prices (August, 2016, sundry form) but I see it is producing, albeit not much, as of November, 2016. #16727; check over the next few months. Update: as of 1/17, taken back off-line. Remains off-line/IA as of 1/18. Is on the AB list.

November 21, 2016: post frack data when the data for the Rolfson N wells come available. The wells will be tracked here.

December 16, 2015: check to see if the second lateral was ever drilled or if production numbers changed significantly --
  • 30949, 233, Sedalia Energy, Thompson 13-31 H, Lake Darling, a horizontal Madison well, not stimulated (not fracked), a short lateral, TD of 9,207 feet, payzone: Mississippian Bluell Pay Bench 3 Target, Renville County, wellbore in target 100% of the whole length, 13 operational days, geologist report dated 6/30/15; a sundry form was received October 9, 2015, with company's intent to drill a second lateral also in the Bluell B3 payzone, t7/15; cum 32K 12/17; no change in monthly production as of 12/17;
August 24, 2015: the Zavanna Simmental wells.

War Drums -- April 11, 2018

CPI numbers: this morning -- ho-hum. In line.

In focus: Mexico's presidential elections. Not going to be pretty for Mexico. I did not realize this: Mexico's refined storage capacity -- three days. Mexico has three days of storage for refined production (gasoline, jet fuel). Mexico does not have the financial reserves to increase that storage capacity. The likely new president, a leftist, has run for president twice before, has said he will end Gulf of Mexico auctions/sales.

Back to the Bakken

Active rigs:

Active Rigs58533193190

*Geo-political (missile strikes in the Mideast pending); falling dollar

Reminder: the price of WTI oil firms need -- the Dallas Fed.

RBN Energy: estimating Dominion Cove Point liquefaction feedage volumes.