Wednesday, March 17, 2021

Record Snowfall In Colorado, Wyoming, Minnesota, Wyoming, And Texas -- March 17, 2021

"Our grandchildren will never see snow." -- Patrick Kennedy some years ago. 

Now this: Record snowfall in Wyoming, Colorado, Wisconsin, Minnesota, Texas; link here.

File: GlobalWarming_2020_2021.

Federal Tax Deadline Delayed

Maybe that's why futures for the three major indices are "up" tonight. 

Later: dropping a bit; NASDAQ futures negative. Oh, well. 

Good luck to all. See  you in the a.m.

Wall Street Journal Headlines

March 17, 2021:

  • Supply chain woes slam global manufacturing
    • Texas deep freeze: triggers plastics shortage (so you think peak oil demand is so yesterday?)
    • backlogs at California ports
  • Covid's origins in China: looks like Trump was correct again
  • Fed hold steady on interest rates and bond purchases
  • gasoline demand has peaked -- IEA; for the archives
  • FTC unlikely to take Qualcomm case to US Supreme Court (Qualcomm wins)
  • giant jeans are making a comeback 

Most Interesting Energy Story Right Now

Enbridge Line 5.

Link here.

ENB hit a 52-week high today.

A Zavanna George Well In Stockyard Creek Has Just Gone Over 500K Bbls Crude Oil -- March 17, 2021

This page will not be updated. The Zavanna George wells in Stockyard Creek, southeast of Williston, are tracked here.  

Purpose of this post is to update one well. Previously posted: this well was permitted back on December 12, 2011. It has recently gone over 500K bbls cum crude oil.

  • 22044, 700, Zavanna, George 19-30 1H, Stockyard Creek, t10/12; cum 517K 1/21; no evidence this well was re-fracked: a) production jump did not exceed newly fracked offset wells; b) FracFocus: only frack was in 2012; c) no sundry form at NDIC to suggest a re-frack; originally fracked 8/30/2012  - 8/30/2012 (no typo; one day; open hole).
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

I was curious. After that jump in production, how fast did production decline. Here is the production since 8/19:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

Production is actually maintaining pretty nicely. Especially considering this well has never been re-fracked.

Federal Tax Deadline -- Extended -- For Tax Year 2020

Federal tax filing deadline extended for tax year 2020:

Liberty Resources Management With Two New Permits -- March 17, 2021

Active rigs:

Active Rigs1756655847

Two new permits, #38211 - #38212, inclusive:

  • Operator: Liberty Resources Management
  • Field: Temple (Williams)
  • Comment:
    • Liberty Resources has permits for two Elroy wells in lot 1 section 6-158-95, 300' FNL and between 1123' and 1147' FEL, in Temple oil field

Two permits renewed:

  • Lime Rock Resources: a State Dvorak permit in Dunn County;
  • XTO: a Frisinger permit in Williams County;

This Is What The Bakken Is All About -- Re-Fracks; Re-Entry Wells; Multiple Formations -- March 17, 2021

This well, originally targeting the Silurian, was drilled in 1988 -- that's thirty-three years ago -- and then re-entered, targeting the Three Forks in 2008, twenty years later, and, then, apparently, re-entered and/or re-fracked again, in 11/20, data not yet posted.

The well:

  • 11983, 220, Petro-Hunt, USA 5D-4-4HR, Charlson, SILURIAN, t7/88; cum 124K 5/08;
  • 11983, 60, Petro-Hunt, USA 5D-4-4HR, Charlson, THREE FORKS, t5/08; cum 265K 1/21; open hole frack, 550,000 pounds proppant; this well was plugged back and re-drilled as a Three Forks lateral in 2008; an open hole frack;
  • sundry form dated June 15, 2014: company says it plans to come back and re-frack this well;
  • 11983, September, 2019: taken off line; no sundry form regarding the re-frack and FracFocus not yet reporting the new frack;
  • 11983, November, 2020; returned to production; look at the huge jump in production; 

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

From The File Report

Sundry form, June 9, 2014: company plans to re-frack this well; the well had been plugged but then re-drilled as a Three Forks lateral in 2008; an open hole frack was originally performed on 7/1/7/2008.

Sundry form, August 6, 2008: stimulation report; open-hole frack; <800,000 lbs proppant; Three Forks, IP: 60 (no typo); the well had originally been drilled by Texaco in 1988 and completed in the Interlake (Silurian). Petro-Hunt bought the well and produced it until late in 2007. Petro-Hunt plugged the Interlake and cut a window in the casing, built a curve to intersect the Three Forks. Placed on a pump, 5/21/2008; the well name was changed to USA 5D-4-4HR after completion to the Bakken-Three Forks.

Geologic summary, the 2008 re-drill to the Three Forks:

  • one section lateral; a total measured depth, 14,790'
  • drilling the curve was incredibly challenging;
    • drilling the curve began at 1:00 a.m., January 19, 2007 (sic) -- probably supposed to be 2008
    • January 21, 2008 -- still drilling the curve, and challenges continued
    • January 25, 2008 -- still drilling the curve
    • operators became concerned with high upper Bakken shale gas of 4,885 units
    • the Three Forks was finally encountered at 10,117 feet, approx 13 feet high to prognosis;
    • "numerous issues were encountered with the gas equipment and extremely cold weather conditions"
    • the high gas readings at 10,134' MD to 10,140' MD may have been due to issues with the analyzer and the cold conditions; once the analyzer was replaced gas seemed to stabilize around 550 to 900 units with connection gases averaging 4,700 units;
    • completion of the curve: date not provided, but drilling the lateral resumed on January 31, 2008, at 9:30 a.m.
    • a maximum trip gas of 5,067 units with an 8-foot flare noted
  • the lateral: drilling the lateral, background gas ranted between 3,300 and 4,600 units; connection gases decreased slightly, ranging between 4,100 and 6,100 units
    • at MD of 12,992': background gas ranged between 5,000 and 7,000 units with connection gases between 6,400 and 7,200 units; a 15' to 20' flare seen
    • maximum trip gas of 7,441 units at 12,257'
    • connection gases ranged between 6,600 and 8,019 units; flares seen at almost all connections and while drilling ahead;
    • drilling as slow at 8 to 11 minutes to drill one foot;
    • resuming drilling on February 19, 2008, rate of penetration was 3 to 10 minutes per foot
  • TD: February 23, 2008, 4:00 a.m. CT; 14,790 feet TD.

17144: Nice Jump In Production -- March 17, 2021

17144: huge jump in production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

36950: the nearest well to #17144, is 1,320 feet away. #17144 is a short lateral; #36950 is a very long lateral and the middle interval of #36950 exactly paralles #17144, but is 1,320 feet away. Wow. Generally, I look for the "halo" effect at 500' distant. At 1,320 this is almost 3x what one would expect.

EIA Gasoline Demand Not Encouraging -- March 17, 2021

EIA data not corroborating GasBuddy data.

No matter how you spin it, this is not encouraging:

A Closer Look At The CLR Gordon Federal Well That Came Off The Confidential List Today -- March 17, 2021

This page will not be updated.

The CLR Gordon Federal wells are tracked here.

The Gordon Federal pad "today":

The well:

  • 36096, 2,117/F/A, CLR, Gordon Federal 12-5H1, Haystack Butte, first production, 11/20; t--; cum 76K 1/21; fracked, 3/1/20 - 3/9/20; 8.4 million gallons of water; 87.4% water by mass; 37 stages; target: Three Forks first bench; within CLR's Rocket prospect
  • from the file report
    • TD: 21,966'
    • Three Forks, geologic top: 11,239'
    • spud date: November 5, 2019
    • TD date: November 27, 2019
    • a great description in the narrative about the challenges of drilling the lateral;

See this post from yesterday,  Tuesday, March 16, 2021, two new Gordon Federal wells, the parent well and the daughter wells.

Early production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

The Never-Ending Pandemic -- March 17, 2021

Jet Fuel Delivered -- Weekly EIA Petroleum Report -- March 17, 2021


March 19, 2021: mystery solved

Original Post

Weekly EIA petroleum report: link here

  • weekly US crude oil in storage increased by 2.4 million bbls;
  • US crude oil in storage goes over 500.8 million bbls, 6% above the five-year average;
  • refiners operating at 76.1% operable capacity;
  • distillate fuel inventories increased by  0.3 million; distillate inventories at 2% below five-year average
  • jet fuel supplied was down 36.2% compared with same four-week period last year;

Most concerning data point from today's report: jet fuel delivered. The number had been improving since the beginning of the year, but dropped precipitously in the most recent report. One wonders if this is still a bit of a hangover from the Texas Deep Freeze even as other fossil fuel product sectors improve following that unfavorable event. 

Those $7,000 Utility Bills? Happy St Patrick's Day -- March 17, 2021

Link here to The Dallas Morning News.

Notes From All Over -- Mid-Morning Edition -- March 17, 2021

CORN! China books 1.16 million metric tons of US corn, first big flash sale in weeks. Link here

Natural gas pipelines: four new US natural gas pipelines come on line. Link to Charles Kennedy.

India: will cut Saudi Arabian oil imports, and buy more from US. Link here. Sulfur content? ULSD ultra light sulfur diesel? Also here at Bloomberg.

Indian crude purchases from Saudi Arabia dropped 36% in January from the previous month, while U.S. imports more than doubled, government data show.

Reuters reported earlier that Indian state-run refiners planned to cut purchases from the kingdom by a quarter to about 10.8 million barrels in May.

Around 86% of Indian oil imports last year were from OPEC+ members, with 19% coming from Saudi Arabia, according to government data. New Delhi has repeatedly called for OPEC+ to pump more crude to stop prices from rising too high, but its pleas have fallen on deaf ears with Riyadh extending its supply cuts and raising premiums for its crude.

Canadian housing! Link here. Prices surging. 

US Retail Sales Surged In January, 2021 -- The Initial 5.3% Estimate Was Revised Upward To 7.6% -- March 17, 2021

Weekly EIA petroleum report: link here

  • weekly US crude oil in storage increased by 2.4 million bbls;
  • US crude oil in storage goes over 500.8 million bbls, 6% above the five-year average;
  • refiners operating at 76.1% operable capacity;
  • distillate fuel inventories increased by  0.3 million; distillate inventories at 2% below five-year average
  • jet fuel supplied was down 36.2% compared with same four-week period last year;

Shale conundrum: from Rigzone

Shale’s newfound prudence after last year’s crash is putting producers in the unusual situation of reducing oil output just as prices surge.

More focused than ever on keeping spending in check, shale drillers haven’t been boring new wells fast enough to keep up with output declines in older ones. So, next month, their combined production will edge lower by 47,000 barrels a day to about 7.46 million, according to the U.S. Energy Information Administration. That’s despite an oil price jump of more than 30% this year.

The impact of the coronavirus on energy consumption was so bad last year that several heavily indebted shale producers went under after years of being bankrolled by Wall Street. Now, producers don’t seem to be in a rush to start another boom, and their backers aren’t either. That’s good news for Saudi Arabia, which has sought to bring prices up without unleashing a new supply glut.

“We are still observing only about 50% of last year’s rig count activity,” EIA analyst Jozef Lieskovsky said by email. “With such a low rig count, even with the increased productivity, production declines in all regions are possible.”

Retail sales: another non-story. Link here. Did anyone even see this? 

Revisions published Tuesday now show retail sales in January increased 7.6% over the prior month compared to initial estimates of a 5.3% increase, ... so this 2.3% upward revision to January's data would've challenged just about any month's report to look good on a headline basis. 
Let alone a report hurt by historically disruptive weather and fading fiscal stimulus. 
"When you have trillions in stimulus going out the door and into consumer pockets at various points, sales will tend to be lumpy." And so strange comps are worth keeping in mind if we start to see retail sales figures go haywire in March or April.

CLR Reporting Another Nice Gordon Federal Well -- March 17, 2021

Active rigs:

Active Rigs1756655847

One well coming off confidential list today -- Wednesday, March 17, 2021: 18 for the month, 74 for the quarter, 74 for the year.

  • 36096, F/A, CLR, Gordon Federal 12-5H1, Haystack Butte, first production, 11/20; t--; cum 76K 1/21;

RBN Energy: inbound pipelines tothe Patoka crude oi hub, part 2.  

The crude oil hub in Patoka, IL, is in many ways a smaller version of the hub in Cushing, OK. 
Like its larger sibling, Patoka receives a broad variety of crudes from Western Canada, the Bakken, and other production areas, stores and blends oil, and sends it out to refineries and Gulf Coast terminals tied to export docks. 
In Patoka’s case, there are only five major incoming pipelines that directly connect to the hub, but many of them receive crude from a number of upstream systems, some as far away as the Alberta oil sands. Important for Patoka’s future, a few of the pipelines feeding the hub are being expanded. Today, we continue our series on the second-largest oil hub in PADD 2 with a look at the pipelines that flow into Patoka and the sourcing of their crude.