Sunday, June 23, 2019

A Snapshot In Time -- North Dakota Oil And Gas Permits Issued In 2017

Updates

Later, 6:49 p.m. Central Time: after posting the original post, a reader sent in a most interesting comment. Posted here.

Original Post

Disclaimer: there will be factual and typographical errors in a long note like this. If this is important to you, go to the source.

Disclaimer: I often make errors in simple arithmetic.

Disclaimer: my numbers won't agree with those of the NDIC but they will be close enough for my purposes.

Disclaimer: the numbers "may not add up." They will be close but errors are likely.

Disclaimer: this was done quickly and was not proofed.

Disclaimer: I did most of this while watching Alfred Hitchcock's To Catch A Thief. I was often distracted by the dialogue.
  • The best line, Cary Grant: It seems I can't get out of this gracefully. 
  • The most memorable line that got past the censor, Grace Kelly: Would you like a leg or a breast? [She brought chicken for their picnic.]
  • More later.
Disclaimer: this list is apt to change by tomorrow. Any well on DRL status could be completed tomorrow; some permits could expire; etc., etc.

Disclaimer: Not all disclaimers have been listed.

Note: IPs are taken from the scout tickets; generally 24-hour flow rates, as far as I know. We've discussed the relevancy/irrelevancy of such IPs in the past. IPs cannot be compared between operators. If 24-hour IPs are meaningful at all, they are only meaningful when compared for one operator. In other words, one cannot compare the historically low IPs reported by BR with the historically high IPs reported by MRO.

Note: factors affecting IPs -- to list just a few --
  • completion strategies
  • natural fractures
  • skill / experience of the frack spread
  • percent of wellbore within the target
  • formation target (middle Bakken; Three Forks, varying benches)
  • the oil field (and that affected by porosity, pressure, permeability, TOC, etc)
Note: IPs on the scout tickets reported by BR "never" correlate with how good the BR wells turn out. The IPs on the scout tickets reported by MRO almost always correlate with how good those MRO wells will be.

Comments:
I don't have the resources, nor the intelligence, nor the interest, to do a statistical analysis regarding any of this data. But going through each scout ticket since 2007, and I have seen every scout ticket since 2007 at least once, it seems there was a jump in 24-hour IPs, 30-day IPs, 60-day IPs, and 90-day IPs somewhere between 2016 and 2017.
And the jump in these initial production numbers were not subtle. The Bakken operators made a huge jump in initial production numbers somewhere between 2016 and 2017. I will provide some examples later. But it is quite amazing. See this post.
  • Relevant history:
    • 2014 - 2016: Saudi Arabia tried to "break" US shale operators
    • 2016: record low number of permits issued during Bakken boom
    • 2017: resurgence in shale permits
Permits:
  • 2019, projected for the year (as of June 21, 2019) --- 1,523
  • 2018: 1,466
  • 2017: 1,189
  • 2016: 818
  • 2015: 2,055
  • 2014: 3,012
  • 2013: 2,671
  • 2012: 2,522
  • 2011:1,916
*************************************
The Data

If I recall correctly:
  • wells must be spud within a year of permits being issued, but $100 will renew lapsing/expiring permits
  • once spud, wells must be completed within two years; waivers by exception
Permits issued in calendar year 2017:
  • First permit: 33243
  • Last permit: 34431
  • Total permits: 1,189
Status of permits / wells (data reviewed June 21 - 23, 2019; NDIC data dated 4/19):
  • TA: 2
  • SI (DUCs): 87
  • PNC: 56
  • loc: 111
  • dry: 12
  • drl: 26
  • conf: 166
  • with IPs: 729
Permits by operator:
  • Abraxas: 11
  • Armstrong Operating: 2
  • Ballard: 1
  • BR: 60
  • Bruin: 1
  • CLR: 82
  • Crescent Point Energy: 83
  • Enerplus: 44
  • EOG: 55
  • Foundation Energy: 1
  • Freedom Energy: 1
  • Hess: 94
  • HRC: 3
  • Iron Oil Operating: 1
  • Kraken Operating: 37
  • Liberty Resources: 14
  • Lime Rock Resources: 15
  • Missouri River Resources: 9
  • MRO: 95
  • Newfield: 17
  • Nine Point Energy: 3
  • NP Resources: 29
  • Oasis: 126
  • Petro Harvester: 19
  • Petro-Hunt: 15
  • Petroshale: 2
  • QEP: 27
  • Resonance Exploration: 4
  • Resource Energy Can-Am: 4
  • RimRock: 2
  • SHD Oil & Gas: 7
  • Sinclair: 5
  • Slawson: 23
  • Statoil: 44
  • Triangle USA: 2
  • UND EERC: 2
  • White Butte: 18
  • Whiting: 115
  • Windridge: 5
  • WPX: 44
  • XTO: 65
  • Zavanna: 2
Non-Bakken permits: 14
  • Madison:10
  • Amsden: 2
  • Red River: 1
  • Lodgepole: 1
SI/NC by operator:
  • CLR: 9
  • Crescent Point Energy: 7
  • Enerplus: 2
  • Hess: 1
  • HRC: 2
  • MRO: 5
  • Oasis: 2
  • Petro-Hunt: 2
  • Statoil (Equinor): 23 (deep pockets)
  • Whiting: 3
  • WPX: 2
  • XTO: 28 (deep pockets)
MRO wells / permits: 
  • SI: 5
  • PNC: 2
  • conf: 4
  • IPs: 84 wells with reported IPs (bopd)
    • average IP: 4,640 bopd
    • range: 1,306 - 8,475 bopd
      • 8,000 and above: 2
      • 7,000 - 7,999: 4
      • 6,000 - 6,999: 10
      • 5,000 - 5,999: 16
      • 4,000 - 4,999: 23
      • 3,000 - 3,999: 20
      • 2,000 - 2,999: 6
      • 1,000 - 1,999: 3

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