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Thursday, September 5, 2019

Texas Wind Not Enough -- September 5, 2019

Link here. "We" should have the least expensive energy in the country but due to crazy reliance on wind: Texas power prices jump to record as heat bakes state.

And "we" have seven more days of this.

And I love it.

Not complaining.

From the linked Reuters article:
Spot power prices in Texas soared to a record high for Thursday as consumers cranked up their air conditioners to escape another brutal heat wave.
Temperatures in Houston were expected to hit 99 degrees Fahrenheit on Thursday and 100 or more through Sunday before easing to the mid-90s next week.
The combination of heat and humidity will make it feel more like 108 F in Houston Thursday afternoon and above 110 over the weekend. The normal high in the city at this time of year is 92 degrees.
Next-day power prices at the ERCOT North hub soared from $130 per megawatt hour  for Wednesday to an all-time high of $973.75 for Thursday.
That tops the previous record of $751 on Aug. 15 during the last heat wave to hit the state.
I think Texas has more wind energy than any other state. And even so, the wind farms couldn't keep up with demand. 

Kernza -- North Dakota Just Keeps Getting Better -- Saving The Planet -- One Wheatfield At A Time -- September 5, 2019

Updates

September 8, 2019: in the linked story at the original post, Kernza was said to be a "wild relative of annual wheat," suggesting to me it was "wild." Now this, from agweek, August 26, 2019:
Kernza is a brand of forage grass called intermediate wheatgrass. It is is in the embryonic stages of development, with an intent toward commercialization, with uses including making bread, pasta and beer.
Kernza, a trademark name for a crop developed at Salina, Kan., by the Land Institute, a group founded in 1976 to develop perennial grains, pulses and oilseeds. The history goes back to the 1980s with the Rodale Institute in Pennsylvania. Kernza research and production has been tried from Kansas to Minnesota in the past several years.
From the linked article:
Kernza — a perennial grain crop that is under development in the Upper Great Plains — will be featured players in a field day, from 9 a.m. to noon, Sept. 26, at the Williston Research Extension Center. Clair Keene, an Extension specialist with the WREC is offering the North Dakota's first research field day on the crop. Keene started the first research site during fall 2018.
And then like the Bakken, the dreaded decline rate:
Keene says it's difficult to talk about yields because part of the raw weight is the hull. Fernholz says older varieties produce 200 to 500 pounds of seed per acre. That translates roughly up to 30 bushels per acre, Fernholz says. Kernza typically produces its best yields in its first three years of production and then production declines "significantly," Fernholz says.Older varieties are more vulnerable to shattering. Kernels are one-eighth to one-quarter the size of a spring wheat kernel. 
And again, we don't get the full story. How does that 30 bushels/acre of Kernza compare to current North Dakota wheat?
North Dakota wheat production averaged 47 bushels of wheat acre in 2019, down two bushels from2018. 
I assume when promoting something, there's a bit of hyperbole, suggesting that 30 bushels of Kernza/acre is on the high side and not the average, and it's in very, very controlled studies.
 
Original Post 

Kernza ...

Link here.
General Mills, Inc.’s Cascadian Farm subsidiary has set up a web site, www.DeeplyRootedForGood.com, for individuals interested in trying its Honey Toasted Kernza cereal.
The company said it has 6,000 boxes of the cereal available, with proceeds from the fundraiser going toward The Land Institute to further research on Kernza, a perennial grain that is a wild relative of annual wheat.
The decision to limit the cereal’s production run and launch the web site comes after Cascadian Farm in 2017 committed to developing a cereal or snack product made with Kernza due to its flavor profile and potential to positively impact the climate. Kernza is described as a sweet, nutty grain.
But the company soon encountered challenges. Maria Carolina Comings, marketing director for Cascadian Farm, pointed out in an April podcast that Kernza takes two years to grow. Over the past two years, the company encountered many factors that impacted the yield, and there were some issues after harvest that affected the available supply of organic Kernza.
According to Cascadian Farm there are 1,200 acres of Kernza perennial grain in production, and the yields are relatively small — about one-quarter that of annual wheat.
The North Dakota connection ...


Why does one get the feeling that this was a "commercial" disguised as a news story? I saw this all the time as editor of a college newspaper.

********************************************
King Of The Road

Gasoline Demand; Natural Gas Fill Rate; NFL Football; And, All That Jazz -- IN PROGRESS -- September 5, 2019

Gasoline demand, link here.


Natural gas, fill rate, link here.


NFL, season opener; 7 - 3, second quarter, NBC; and, it interests me not -- see next note.

Thursday Night Lights! Link here. Texas high school football! El Paso Eastwood High School at Plano Senior High. In Texas tonight, this is bigger than Green Bay / Chicago. LOL. This is huge. On prime time television, ABC. This is why I got to Texas as fast as I could on my way to retirement. Wow, it doesn't get any better than this. At The Star in Frisco. Jerry's house. Playing at a neutral field. It is awesome to hear local announcers providing pre-game coverage on national television. This is really amazing. Jerry Jones, Dallas Cowboys, offered his stadium for the game. Yeah, it's that big.

************************************


Oasis Corporate Presentation -- August, 2019

The last Oasis Petroleum presentation I posted at the blog was back in May, 2019. It's possible I've posted a newer one since then, but if I have, I've forgotten.

So, here's a look at the August, 2019, corporate presentation for Oasis Petroleum. Link here.

Disclaimer: this was done quickly. Some charts hard to interpret without the narrative. There will by typographical and factual errors. If this is important to you, go to the source. This was posted just to help me compare the Bakken with the Delaware (Permian)

Net acres
  • Williston: 414,000
  • Delware: 23,000
Gross operated top tier inventory:
  • Williston: 1,385 drilling locations
  • Delaware: 600 - 700 drilling locations
Rigs in 2019:
  • Williston: 2 - 3 (look at the efficiency -- 70 wells to be completed; 2 or 3 rigs)
  • Delaware: 2 (ten wells to be completed; 2 rigs)
YTD production (boepd)
  • Williston: 82,000 boepd ((will drop slightly y-o-y in 2019)
  • Delaware: 6,000 boepd (will increase y-o-y in 2019)
Costs (hard to be sure if I'm reading slide correctly but if I am):
  • Williston: $7.6 million / well
  • Delaware: $11.5 million / well (target: $9.6 million / well)
Completions:
  • Williston, 2019: target ~ 70 well completions
  • Delaware, 2019: target  ~ 10 well completions 
Free cash flow:
  • Year-to-date: positive cash flow: targeting $16 million in 2019
  • Williston asset producing FCF to fund Delaware and OMP growth
  • full year (2019): targeting $80 million FCF at $50 WTI
  • full year (2019): targeting $110 million FCF at $60 WTI
  • OMP outspend due to Delaware infrastructure build-out and funding Oasis' interest in Bobcat DevCo
Operations -- Bakken (to make sense of this, one needs to see the map at the presentation):
  • enhanced completions expand top tier position
  • top tier: 
    • Montana: 27
  • enhanced completions
    • Red Bank perimeter: 56
    • Red Bank, Painted Woods, Indian Hills: 63
    • S Cottonwood: 8
  • additional upside:
    • N Cottonwood: 7
  • others:
    • Montana perimeter
    • Wild Basin (North Dakota)
    • Alger (Mountrail County)
  • 1,385 top-tier operated locations: 20+ year inventory life at current rig pace
Breakeven prices below $45 WTI
  • South Cottonwood now top-tier inventory
Production per 1,000 feet of lateral:
  • South Cottonwood
    • pre-2016: 2,122 bbls cum 3 months
    • 2016+ wells: 5,189 bbls cum 3 months
    • Bakken average, 2016+: 5,358 cum 3 months
  • Painted Woods
    • pre-2016: 3,028
    • OAS recent tests: 5,720
    • 2016+ Bakken average: 5,358
  •  similar in Montana
Comparing Oasis with 15 peers in the Bakken:
  • Oasis is #2 boe / #3 bo in "Williston well productivity" but pretty much tying #1
Fracking: focus on increasing frack entry points

Other:
  • Oasis' MLP is now the 2nd largest gas processor in the Williston Basin after hte startup of Wild Basin Gas Plant II in December 2018
  • Bobcat DevCo
  • Panther DevCo -- crude oil gathering and produced water in the Delaware Basin
Production per well in Delaware, slide 12:
  • UL Rattlesnake: one month cum of 3,500 bo/1,000 feet of lateral
  • UL Kerwin: three month cum of 7,500 bo/1000 feet of lateral
  • UL Stampede: 12 month cum of 21,000 bo/1000 feet of lateral

Hunt's Halliday Wells In Werner Oil Field Have Been Completed -- September 5, 2019

The Halliday wells in Werner oil field and Wolf Bay oil field have been completed. These are some very nice wells. Then look how far east they are. These wells are tracked here.

And, of course, of the two dozen wells or so at the linked site, this one caught my attention:
  • 19786, 843, Hunt, Halliday 1-12-1H 1, section 13-146-93, Wolf Bay, Bakken, t5/11; cum 458K 7/19; huge well with nice jump in production, 1/19;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-2019313945399391032379432181
BAKKEN6-20193034973444940628408171820
BAKKEN5-20192827502693768970555756015
BAKKEN4-201930332034006551338412222025
BAKKEN3-2019314756507710335542624522749
BAKKEN2-2019285127479010281545321972528
BAKKEN1-2019314038404414359658627203458
BAKKEN12-20183151113732557459246211
BAKKEN11-20181193960880
BAKKEN10-20182616321522113312177810
BAKKEN9-20183017631624134113249850
BAKKEN8-201831173818181119000

XTO With Three New Lost Bridge Permits -- September 5, 2019

Doomsday: this is not really a "big box store" story, but ... over at this site, I track the demise of the "big box store / brick-and-mortar." 
  • running out of time, CNN, July 11, 2019
  • today, to close stores; refresh more than 160 of the company's stores; will liquidate up to $1 billion in inventory; link here
  • the company did not note tariffs in its press release (unless I missed it)
  • the company's problems began long before Trump's tariffs
******************************
Back to the Bakken

Active rigs:
$56.199/5/201909/05/201809/05/201709/05/201609/05/2015
Active Rigs6264573375

Three new permits:
  • Operator: XTO
  • Field: Lost Bridge (Dunn County)
  • Comments: XTO has permits for a 3-well Carus Federal pad in lot 2/section 36-148-97, Lost Bridge oil field
Three permits canceled:
  • CLR: three LCU Jessie permits canceled, Jessie 2ND, 3ND, and 4ND
Six producing wells (DUCs) reported as completed:
  • 35978, 2,865, Newfield, Sturgeon 150-99-18-19-2H, South Tobacco Garden, t7/19; 13K over 8 days;
  • 36041, 1,384, Kraken, Coveleski 26-35 5H, Lone Tree Lake, t8/19; cum --;
  • 36042, 1,814, Kraken, Coveleski 26-35 LW 1H, Lone Tree Lake, t8/19; cum --;
  • 36043, 369, Kraken, ruffing 27-346H, Lone Tree Lake, t8/19; cum --;
  • 32399, 1,665, Slawson, Atlantis Federal 2 SLH, Big Bend, t8/19; cum --;
  • 32398, 535, Slawson, Atlantis Federal 5-34-35MLH, Big Bend, t7/19; cum --;

Hubbert's Theory Re-Visited, The Incredible Bakken -- September 5, 2018

This well was first drilled/completed back in 2011. By 9/18, it should have been in terminal decline.

The well:
  • 18859, 680, CLR, Carson Peak 3-35H, t5/11; cum 726K 7/19; nice production profile (5/18); note production jump 4/19;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-2019311322613455100421479313941434
BAKKEN6-2019301567015737142661737193957578
BAKKEN5-2019311340013201150191383068056619
BAKKEN4-20192813423130171008513523109592202
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-20190000000
BAKKEN12-20180000000
BAKKEN11-20180000000
BAKKEN10-20186518703505655060
BAKKEN9-201830361537213783721325976
BAKKEN8-20183137583961439380033860
BAKKEN7-20183136543545553350231130
BAKKEN6-2018303728360947337233106230

New Wells, Old Wells; Watch The Water At The New Wells -- September 5, 2019

Water: a regular reader noted this before I did. Long before I noted it. Pay attention to the produced water. It is not uncommon to frack with 10 million gallons of water. Ten million gallons of water = 240,000 bbls of water. 

The new well:
  • 35272, 3,376, CLR, Carson Peak 4-35HSL, Oakdale, t6/19; cum 91K 7/19;
Production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-20193147953479421489047231408086066
BAKKEN6-20192038293380391162532326244247528
BAKKEN5-20190000000
BAKKEN4-20190000000
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-20198503750372851261802618


The new well:
  • 35273, 2,405, CLR, Carson Peak 5-35H2, Oakdale, t6/19; cum 72K in less than two months;
Production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-20193141100410642409940882353225251
BAKKEN6-20192028751285601775324930188365806
BAKKEN5-20190000000
BAKKEN4-20190000000
BAKKEN3-20190000000
BAKKEN2-20194232423247296670667
BAKKEN1-20192001319120701207

The new well:
  • 35082, 1,593, CLR, Morris 8-26H1, Oakdale, see this note; t4/19; cum 126K 7/19;
Production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-20193125821258521542928660247633681
BAKKEN6-20193026062261851810825808194996010
BAKKEN5-20193136743369242337741250364684323
BAKKEN4-20192136555360782348439928350514496
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-2019473073029887140714

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The Older Wells

The well:
  • 17334, 811, CLR, Morris 1-23H, t11/08/ cum 317K 7/19; another re-frack candidate; off-line 5/18; back on line as of 6/18; back on line as of 4/19; looks like a pretty significant halo effect;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-2019318667846143188989847397
BAKKEN6-201930111571135462071216211016748
BAKKEN5-201931133111314695261417113428358
BAKKEN4-20191558355645591157285336236
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-20190000000
BAKKEN12-20180000000
BAKKEN11-20180000000
BAKKEN10-20180000000
BAKKEN9-20180000000
BAKKEN8-20183111421380203149911230
BAKKEN7-20183111231164185140292758
BAKKEN6-201830108589918712608610
BAKKEN5-201822203326026
BAKKEN4-201829835143510894387370

************************* 
Another Well In The Group 
The well:
  • 18859, 680, CLR, Carson Peak 3-35H, t5/11; cum 726K 7/29; nice production profile (5/18); huge jump in production;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-2019311322613455100421479313941434
BAKKEN6-2019301567015737142661737193957578
BAKKEN5-2019311340013201150191383068056619
BAKKEN4-20192813423130171008513523109592202
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-20190000000
BAKKEN12-20180000000
BAKKEN11-20180000000
BAKKEN10-20186518703505655060
BAKKEN9-201830361537213783721325976
BAKKEN8-20183137583961439380033860
BAKKEN7-20183136543545553350231130

A CLR Miles Back On Line? -- September 5, 2019

The well:
  • 33220, 1,111, CLR, Miles 8-6H1, Dimmick Lake, 4 sections, t7/18; cum 46K in first couple of months; cum 63K 7/19; off line as of 12/18; remains off line through 4/19; back on line as of 6/19 and huge jump in production;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-2019152156010001138831055
BAKKEN6-201930119911187721862246441182612815
BAKKEN5-2019337361136554390164
BAKKEN4-20190000000
BAKKEN3-20190000000
BAKKEN2-20190000000
BAKKEN1-201900400000
BAKKEN12-20181944484475130981034459484395
BAKKEN11-20182613836139282567219863173142547
BAKKEN10-20183018431182863661930884209639918
BAKKEN9-2018529222912786650904450640
BAKKEN8-2018311891423383320251682343
BAKKEN7-201811843982012261513690124441246
BAKKEN6-20180000000
BAKKEN5-201869169168148242802428

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Another Well In The Same Group

The well:
  • 33221, 1,696, CLR, Miles 7-6H, Dimmick Lake, t7/18; cum 142K 7/19; huge well;
Recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-201911038107074927371992538
BAKKEN6-201922191771899414369467272242324299
BAKKEN5-201900160000
BAKKEN4-20194110412643746285715501307
BAKKEN3-2019316558644625130219261139710525
BAKKEN2-20197146914054715635040262322
BAKKEN1-201900400000
BAKKEN12-201820446645081207921185121819002
BAKKEN11-20182716874169961501130117262523862
BAKKEN10-201827236642354122399444473016914274
BAKKEN9-20182016499165102794033408292044201
BAKKEN8-201829289362939742335607495046910276

*************************** 
Another In The same Group

The well:
  • 29124, 633, CLR, Kennedy 3-31H, t3/15; cum 321K 7/19;
Production of interest:
BAKKEN12-2018309927971756151619410815696
BAKKEN11-20182779878159552013190148011406
BAKKEN10-2018311147611340787418912253715984
BAKKEN9-2018301038910621779318161646111343
BAKKEN8-2018301183211304844219962334116240
BAKKEN7-201831153891550911442279571642211136
BAKKEN6-2018228243829568751667690317444
BAKKEN5-20181416001351130928571944913
BAKKEN4-20180000000
BAKKEN3-20180000000
BAKKEN2-20180000000
BAKKEN1-20181720822326975646664660
BAKKEN12-20173142194209180912711127110
BAKKEN11-20173047944882197812336123360
BAKKEN10-20173142354035229885878304283
BAKKEN9-201730286028041664532153210
BAKKEN8-201730344832932012706460461018
BAKKEN7-20172535313661228716011160110
BAKKEN6-20173042584188228919594195940