Tuesday, July 6, 2021

Whiting With Two More Kannianen Permits; Five DUCs Reported But No Production -- July 6, 2021

Active rigs:

Active Rigs2211586557

Two new permits, #38412 - #28413, inclusive --

  • Operator: Whiting
  • Field: Sanish (Mountrail)
  • Comments:
    • Whiting has permits for two more Kannianen wells, both section line wells, one middle Bakken well, and one a Three Forks well;
    • these wells will be sited in lot 4 sectrion 5-153-91; 408 FNL and between 564 FWL and 654 FWL; 
    • the Kannianen wells are tracked here.

One permit renewed:

  • Murex: a Patricia Ann permit in Williams County;

Five producing wells (DUCs) completed:

  • 37298, loc/A, CLR, Irgens Rexall 4-19H1, East Fork, first production --; t--; cum --;
  • 37301, loc/A, CLR, Irgens Rexall 7-19H, East Fork, first production --; t--; cum --;
  • 22300, SI/A, Bruin, FB Belford 148-95-22D-15-2T, Eagle Nest, first production --; t--; cum --;
  • 22301, SI/A, Bruin, FB Belford 148-95-22D-15-3B, Eagle Nest, first production --; t--; cum --;
  • 37299, loc/A, CLR, Irgens Rexall 5-19H, East Fork, first production --; t--; cum --;

The Bull Market Will Last Much Longer Than Expected -- July 6, 2021

From Breitbart Business Digest:

Otto von Bismark, who was no slouch when it came to building a personal fortune after inheriting a debt-ridden handful of estates from an ineffectual father, once said that it was the job of a statesman "to hear God's footsteps marching through history." 
We would not pretend to have any special access to the sound of God's footfall, but we do listen closely to the purchasing managers surveys produced each month by the Institute of Supply Management and IHS Markit, which this week appeared to be tapping out a warning about stagflation in the services sector
Both reports showed that the services sector continued to grow at an impressive pace in June, not surprising as many businesses have just returned to full capacity, and consumers are still flush from the year of lockdowns and stimulus checks. 
But the growth was less surprising than analysts expected. 
The general sense they gave is that growth has already peaked, earlier than many expected. 
The bull case for the economy—that the faster-than-expected growth of the past few months would build momentum and keep growth high through the end of the year—seems much less likely now. 
It's also clear from the reports that the snarled supply chains, shortages, and difficulty in hiring employees have not quickly cleared
Indeed, as Chris Williamson of IHS Markit said in his commentary Tuesday, the "supply constraints are not only stifling growth but also driving prices sharply higher." 
Williamson notes that June saw the second steepest ever rise in prices in the 11-year history of the IHS survey. Add to the inflation worries the ever-rising price of oil. 
Until the last few days, it was widely expected that the Saudi-led OPEC+ group would aid the global recovery by increasing the supply of oil to tamp down on the price as global demand lifts
But the United Arab Emirates object to the lower prices, most likely because the emirates can hear the rest of the world openly conspiring to no longer buy any of the stuff that flows beneath their country. It's hard to blame them for wanting one last hurrah of high oil prices following the pandemic. 
It might not be God's footsteps they are hearing, but they know that the march of history isn't toward more dependency on Gulf oil. And so oil is likely heading higher through the summer. 

 – Alex Marlow & John Carney
Breitbart News Network

Help From Readers: Is Something Going On With The CLR Anna Wells In Last Chance Oil Field? -- July 6, 2021

A reader wrote me about  a month ago suggesting that, based on his royalty check, the CLR Anna wells were producing well under their historic level and was wondering if I might know why. I was unable to answer because the NDIC had not yet updated the May, 2021, production data. 

That data has now been updated over at the NDIC.

CLR has one parent Anna well and eight Anna daughter wells. In general, they are very good wells, but perhaps starting to show their age. 

The wells are tracked here. The May, 2021, production data has been updated, and it confirms what the reader noted: the Anna wells produced well under their historic norm in May, 2021.

These are the nine Anna wells, and their recent history. All of these wells have been steady performers, "never" coming off line since beginning steady production, except for #32967. :

  • 32967, off line for the past six or seven months; it may be coming back on line; four days of production in May, 2021, full production profile posted here; middle Bakken;
  • 32966, t8/17; cum 162K 5/21; on line for only 9 days in May;
  • 30155, t7/17; cum 146K 5/21; on line for only 9 days in May;
  • 30154, t7/17; cum 181K 5/21; on line for only 9 days in May;
  • 32969, t8/17; cum 157K 5/21; on line for only 9 days in May;
  • 30156, t8/17; cum 146K 5/21; on line for only 5 days in May;
  • 32968, t9/17; cum 144K 5/21; has not been taken off line; Three Forks first bench
  • 23279, t11/12; cum 394K 5/21; on line for only 10 days in May;
  • 30157, t7/17; cum 270K 5/21; on line for only 9 days in May;

So, two observations:

  • monthly production from the Anna wells is "way down" compared to previous months; there is nothing I could find in the file reports to suggest a reason;
  • we won't know until the June, 2021, data is out whether the nine days of production in May was at the front end or the back end of the month of May:

The available information suggests CLR recently did some work with #32967 that was enough to bring the well back on line; possibilities:

  • a new pump;
  • a simple re-work;
  • a re-frack of some sort;

Thought: One would not think that a new pump or a simple re-work of a single well would require the other wells to come off line (with one exception, #32968, a Three Forks first bench well);

  • my hunch, a re-frack of some sort or some type of work that might have impacted the neighboring wells middle Bakken wells;

Perhaps a surface owner, another mineral owner, a landman, might have more information.

Finally, maybe not by June, 2021, but certainly by July, 2021, royalties from the CLR Anna wells should return to "normal" and perhaps be better than ever.

One Well Coming Off Confidential List -- Another DUC -- July 6, 2021

Wow, isn't this the truth? Link here

Market: a reversal today on the three major indices is simply related to the calendar. The second quarter ended last week, the third quarter starts this week. Today's market is pretty much a non-event. Buying opportunity at best.  I can hardly wait to see the earnings reported by oil companies. Earnings will be compared to prior year, 2020, which is nonsense, but that's how "they" do it. Earnings should be compared to same period in 2019.

OPEC basket price. Link here. $75.71.

WTI: it's a fool's errand to predict oil prices. This is just a comment. Not a prediction. It appears most analysts feel oil will remain in a trading range, $65 - $85. Very few "respectable" analysts actually see $100 oil. Right now it appears it might be a real challenge to get to $85 before the end of the year.

Are we back or what! Last March, 2020, more than a year ago, I was "evicted" from Starbucks when the word went out -- everything was closing due to the pandemic. And here I am, back in a Starbucks in north Texas, more than a year later. First time in over a year that I've actually set foot in a Starbucks and the first coffee from same. Wow. Surreal. Masks optional for fully vaccinated. I'm fully vaccinated. I'm one of the few that came into the store masked. But everything is spread out and so few in the store that I am wearing my mask where most folks wear their masks now: under their chin. LOL

Starbucks: I wouldn't be here except that I drove my wife to a medical appointment and then went off for coffee. I told her I would be back in three weeks. LOL.

Back to the Bakken

Active rigs:

Active Rigs2211586557

One well coming off confidential list:

Tuesday, July 6, 2021: 2 for the month, 2 for the quarter, 182 for the year:

  • 37399, drl/NC, CLR, Gale 8-32H1, Cedar Coulee, no production data,

Monday, July 5, 2021: 1 for the month, 1 for the quarter, 181 for the year:

  • None.

Sunday, July 4, 2021: 1 for the month, 1 for the quarter, 181 for the year:

  • None.

Saturday, July 3, 2021: 1 for the month, 1 for the quarter, 181 for the year:

  • None.

RBN Energy: will crude oil hit $100 a barrel?

After the crude oil price crash in the spring of 2020 and flat-at-$40/bbl oil last summer and early fall, prices for both WTI and Brent have been increasing steadily the past several months, and now stand at a kind-of-remarkable $75/bbl. This rise has been driven by a combination of demand recovery and supply restraint from both OPEC+ and U.S. producers — which begs the questions: what’s next on the supply and demand fronts, and how much more will oil prices increase from here? There’s been a lot of chatter lately that we might see $100/bbl crude prices sometime soon, and there are a lot of interested parties — many of whom don’t normally see eye-to-eye — who, for one reason or another, see their interests converge around the $100/bbl mark. The only problem is, it’s not showing up in the forward curve. Today, we look at the potential for “Benjamin-a-barrel” oil and how it might play out.

For most of us, Fourth of July this year was a heck of a lot more social and fun than last year, when COVID-19 lockdowns, mask-wearing, and a general sense of anxiety had just about everyone in a funk. No doubt, there’s a lot of reason for optimism nowadays. These high hopes have even extended to the energy sector too. Demand for gasoline, diesel, and jet fuel are up among developed nations and the U.S. in particular. Last Friday, heading into the holiday weekend, U.S. gasoline and diesel prices soared to their highest level in seven years and U.S. refiners are running hard to keep pace, with refinery utilization up to 93% recently. Crude oil production has been increasing more slowly than demand, however, resulting in inventory draws and higher prices for crude and refined products. The modest, measured gain in production is partly by design. The members of OPEC, led by Saudi Arabia, along with Russia (OPEC+), have been uncharacteristically disciplined in ratcheting up their crude oil output, and have been rewarded by steadily higher prices — we’ll come back to that topic a bit later.