Saturday, May 26, 2018

Wells Coming Off Confidential List This Next Week, May 26, 2018

Friday, June 1, 2018:
33911, SI/NC, Hess, BB-Sigrid Loomer-150-95-0817H-8, Blue Buttes, no production data,
33910, SI/NC, Hess, BB-Sigrid Loomer-150-95-0817H-7, Blue Buttes, no production data,
33637, SI/NC, MRO, Snowman USA 41-25H, Antelope, no production data,
33384, 2,487, WPX, Mandan North 13-24HX, Reunion Bay, t4/18; no production data,
33136, 918, Newfield, Bice 148-97-18-17-1H, Haystack Butte, t4/18; cum 18K over 16 days;
33076, 1,873, Oasis, Patsy 5198 12-17 4B, Siverston, t12/17; cum 128K 4/18;
32948, 683, Oasis, Patsy 5198 111-5 2BX, Siverston, t12/17; cum 132K 4/18;

Thursday, May 31, 2018:

Wednesday, May 30, 2018:
33457, 1,525, Whiting,King 11-8TFHU, Truax, t112/17; cum 65K 3/18;
33383, 3,115, WPX, Mandan North 13-24HB, t4/18; cum --
33137, 1,208, Newfield, Bice 148-97-18-17-2H, t5/18; cum --
30695, loc, Rimrock Oil & Gas, Charging Eagle 15-21A-16-4H3, Twin Buttes,
29203, 894, Lime Rock Resources,Hansen 18-19-1H RD, 50 stages; 9.8 million lbs, Stanley, t12/17; cum 63K 3/18; I don't understand the "RD" designation. that was there at the time of the original permit (a Fidelity permit); original name, Hansen 18-19RD: name change (1-25-2016) to Hansen 18-19-1H RD but no explanation; Lime Rock did change location of bottom hole but that generally doesn't result in name change;

The Market, Energy, And Political Page, T+16, May 26, 2018 -- May 26, 2018

WTI: price dropped below $70 yesterday; market panics; folks expect price of gasoline to collapse on Tuesday, May 28, 2018, just in time for driving season.

Disclaimer: this is not an investment site. Do now make any investment, financial, job, travel, or relationship decisions based on anything you read here or think you may have read here. For example, it is highly unlikely that the price of gasoline is going to collapse any time soon, and certainly not by next week.

Apparently "size matters": from Bloomberg via Rigzone --
Darren Woods is mounting a strong defense of his plan to rescue Exxon Mobil Corp. from its share-price slump with $200 billion of investment over seven years that’s at odds with the belt-tightening undertaken by rivals.
Woods’ solution, outlined in a Wednesday interview, is to invest heavily in mega-projects that he says are so low cost they’ll dominate oil and natural gas markets for decades to come.
Share buybacks will come only if there’s excess cash, the chief executive officer said, ahead of a speech on the company’s strategy at Exxon’s annual meeting on May 30.
Now his job is to persuade skeptical investors his plan will work, a hard sell so far. Since Woods became CEO in 2017, Exxon has fallen 9 percent, compared with an 18 percent gain for its biggest rival, Royal Dutch Shell Plc.
The CEO said he sees “a little bit of a disconnect” between the market’s short-term expectations and Exxon’s long-term planning.
But he remains confident. [He should have said, "size does matter."]
Heidi now seen everywhere, from Williston Economic Center newsletter:
City leaders from Midland, Texas will be in Williston May 31 through June 1 to learn about Williston's response to the challenges of the recent oil boom.
The group will bring a total of five representatives to North Dakota including Midland Mayor Jerry Morales.
Like Williston, Midland has strong ties to the energy industry and has experienced the same ebbs and flows including recent rapid population growth. (Midland was the fastest growing region from 2010 to 2015 according to the US Census Bureau.)  The first day of the session will be held at the Center for Development. U.S. Sen. Heidi Heitkamp is scheduled to welcome the guests and open the discussion.
Bakken economy, from Williston Economic Center newsletter:
  • new Burger King to open in Sidney
  • New Town breaks ground on new fire station

North Dakota Crude Oil Production "Will" Set New Record This Summer -- Lynn Helms -- Saturday, May 26, 2018

Lynn Helms: suggests ND will set a new oil production record in June, 2018;
Ka-ching: ND Legacy Fund earnings exceed $1 billion since inception. From Inforum --
  • total net earnings (not deposits): have exceeded $1 billion
  • a $62 million deposit deposit Monday brought the state's Budget Stabilization Fund to about $100 million
  • Monday's deposit to the Budget Stabilization Fund wasn't to occur until July; better than expected oil production and revenue helped the bump
  • average daily oil production from biennium-to-date is 23 percent ahead of forecast, while average oil price per barrel from biennium-to-date is 6 percent ahead of forecast
  • the Legacy Fund has received monthly deposits in excess of $50 million for most months this calendar year—a number not seen since August 2015
  • more from the article:
Kempenich said the earnings milestone was unexpected from the fund's early years, before a new investment strategy for asset allocation in 2013.
"I remember in committees when these were being tossed around, they were hoping that we'd would have $1 billion in principal by 2017 and that we might have earned $100 million in it, and it's quite a bit better than that," he said. "But the oil has done well and the earnings have done a lot better than what we've had."
Bakken talk: major issue in western North Dakota right now -- jobs go begging; workforce not meeting needs

Bakken roads: from Minot west to Williston, and then south to Watford City, it's pretty much a four-lane divided highway -- by any other name, an interstate highway --
  • ... and now ND DOT gathering input on making the highway -- US 85 -- a four-lane divided highway
  • call me crazy but I don't think "they" would be doing this if they thought the Bakken was going to go away
Not naming names: I see there's a new book available for sale in the Bakken --
  •  ... an anti-oil environmentalist inherited Bakken mineral rights; the author used the money to write a book about the "downside" oil; while writing the book and gathering data for the book, the author spent weeks touring the state and interviewing "locals" while driving around in a big SUV
  • no mention by the author whether she will "give back" her mineral rights to the state
  • I know if I was an anti-oil environmentalist I couldn't live with myself if I inherited mineral rights and kept the money
  • but, then again, that's just me
  • disclaimer: I paged through the book; read very little of the book; I may have some "facts" wrong
The Bakken: some quick links while traveling. A huge "thank you" to a reader for sending me the links -- saves me a lot of time.
  • Growth -- US News
    • most of North Dakota's biggest cities get bigger in 2017 
    • Fargo: grew nearly 1.7%
    • Bismarck: grew 0.7%
    • Grand Forks: up 0.4%
    • Minot: population dipped for the second straight year; about a 2% decrease from previous year
    • again, a reminder, this is data for 2017; we may see a change in 2018
    • Dickinson: declined 2.3%
    • Williston: declined 2.7%
    • housing unit growth, ND showed the largest growth since 2010, at 18%
  • Production: CLR's Bakken well returns double in year's time -- fortunately, not hedged -- NGI
    • repeating, for those who missed it: CLR's Bakken production returns double in year's time
  • Water disposal: will continue to be a challenge as the Bakken sets new records -- NGI
  • Economy: North Dakota oil, gas revenue up 25% -- US News 
    • and this is just the beginning
    • much more than expected
    • a report by the Legislature's research arm shows North Dakota's oil and gas revenue is $1.6 billion for the state's current two-year budget cycle that began in July
    • that's $323 million more than initial estimates
  • Wind: new lighting technology required for ND wind farms, not yet approved by FAA -- Bismarck Tribune
    • North Dakota legislators last year directed the Public Service Commission to adopt rules that require light-mitigating technology for wind turbines
    • pending legislation: new night lighting on wind towers must spell out O-I-L

May 26, 2018

Trans Mountain Pipeline Project update, data points here --
  • court orders Vancouver (city) to pay Kinder Morgan (pipeline company) for legal costs after BC's top court hands company twin victories
  • the Supreme Court of British Columbia threw out two challenges against the B.C. government’s environmental approvals for the $7.4-billion Trans Mountain pipeline project
  • adds to Kinder Morgan Canada Ltd.’s near-perfect record of winning legal cases even as the project faces stiff opposition on the ground
  • the B.C. Supreme Court dismissed applications by the City of Vancouver and the Squamish Nation to overturn the environmental certificates the former Liberal B.C. government had granted to the Trans Mountain project
  • in a decisive victory for the company, Justice Christopher Grauer (see this link) ruled that Vancouver would need to pay Kinder Morgan unspecified legal costs. Prior to the two cases, Kinder Morgan had won 14 court challenges in a row for its Trans Mountain pipeline project
CNBC on-location update regarding the Bakken. CNBC here in Williston, link here:
  • plenty of jobs in the Bakken
  • tough to get enough workers
  • the slowdown after the first Bakken boom was welcomed by many Willistonites
  • maybe too many apartment units
  • perhaps lack enough single houses
  • 700 births/year -- two births a day
  • man-camps shut down
  • quality of life much better
  • standard of living, much higher
  • "on our way to maybe 60,000 wells"; currently 14,000 wells
  • now, measured growth
  • $70 million rec center
  • new airport being built
  • new hospital
  • renovation downtown
  • college free for local residents

Overnight, Discussion Switches From Demand To Supply -- May 25, 2018

For the archives, last twenty-four hours regarding price of oil , headlines from various sources, tweets from various sources:
  • Russian and Saudi Arabia discuss one million bopd production rise
  • Putin says $60-oil suits Russia fully
  • oil prices -- in the last 24 hours -- fell the most in 11 months in New York as Saudi Arabia said it expects OPEC and its partners to boost supplies
  • let's go back in a bit -- who still thinks Saudi Arabia wants $100-oil?
  • Saudi Arabia would prefer higher prices but also wants to keep the White House happy. Trump's tweet underscored the growing unhappiness of consumers and the president's willingness to make this unusually public. So Saudi Arabia's calculations changed
  • my take on OPEC today: under pressure form Trump, Saudi Arabia puts brakes on oil price rally (but under the radar, also fears in Riyadh about N-OPEC act revival
  • ask 100 analysts; get 100 opinions on WTI pricing today
  • for newbies:
    • Saudi Arabia's budget was based on $83-oil last year (2017) (didn't come close)
    • Saudi Arabia's budget is based on $88 oil for this year (2018) (won't come close)
    • global production / demand: around 100 million bopd
    • for weeks analysts have suggested "demand" is driving increased oil prices
    • now, one day that OPEC/Russia suggest increasing production by one million bopd, all of a sudden it seems discussion has shifted to production not demand
For newbies: predicting the price of oil is a fool's errand.

BPolls: Let's close out two polls. The first poll -- will WTI hit $85 by August 31, 2018?
  • yes: 35%
  • no: 50%
  • I prefer not to answer: 11%
  • other answers: 5%
For Big Oil, "size does not matter"; from articel
  • agree: reserves don't matter for "Big Oil": 7%
  • disagree: I understand the argument but disagree with the "reasons": 20%
  • disagree: the writer is a complete doofus; size does matter, and it matters a lot: 72%
  • comments: I agree with the majority. The writer is a complete doofus. For any oil company, size of reserves is incredibly important