The Million Dollar Way (The Bakken Oil Blog): 12/27/21

Monday, December 27, 2021

If This Can Be Verified -- A Completely Different Spin -- But Wrong -- December 27, 2021

The graphic speaks just the opposite -- the lead-up to the energy crisis in Europe had nothing to do with the United States .... wow, talk about misinterpreting data ....

Link here.

After Ten Torturous Days ... December 27, 2021

From social media today:

Thirty-two Active Rigs -- December 27, 2021

Raise your hands if you like $75!

Active rigs:

$75.57	12/27/2021	12/27/2020	12/27/2019	12/27/2018	12/27/2017
Active Rigs	32	13	56	67	51

The NDIC daily activity report: "No activity to report." The NDIC did report 33 active rigs. One was drilling a SWD well, so 32 active oil and gas rigs?

Notes From All Over -- December 27, 2021

Fauci caves: CDC takes a page from the professional sports franchises, the NFL and the NBA. Whoo-hoo! CDC cuts isolation time to five days for Covid-19. This is incredible. This is a game-changer. In after hours, futures surge on this news. Yes, I know Dr Fauci doesn't work for the CDC, but "Fauci" is a metonym for a failed centrally-managed politically-heavy pandemic response based on little science. The silver lining to this metonymic cloud: every future president will be very cautious turning policy over to one individual.

European energy crisis: natural gas flows from Russia to Europe reversed. Crisis continues. But natural gas prices plummet in Europe over Christmas. Link here.

Santa Claus rally: US equity markets surge today. Will it continue through the end of the year? Screenshot of the day:

WTI: nice uptick at the beginning of last week of 2021.

Covid-19: the US presidents agrees with GOP governors that the pandemic cannot be solved with a federal one-size-fits-all solution. Says much of this will be handled at the state level. I doubt anyone knows what this means, where it leads.

US airlines / US travel: "they" better take a page from the NFL playbook.

RMDs. From July 24, 2021, The Street: why you should take RMDs this year (2020). Remember, in 2020, the government waived RMDs for one year (tax year 2020). Would you really want the writer of this article to be your financial advisor? Wow, is he/she wrong in so many ways.

Montana's Largest Wind Farm Near Miles City -- December 27, 2021

Link here.

Montana's largest wind farm underway near Miles City.

The lede:

ANGELA — On a recent winter afternoon the wind on this Eastern Montana plain was rising slowly like a tide, the cool dense air rolling in to replace what’s been warmed by daylight.

At first, the change is barely noticeable, but then the 210-foot blades of the Clearwater Wind Project start to turn. Though the blades have been feathered to catch none of what this chilly air has to offer, they turn nonetheless.

The setting is perfect for what will be Montana’s largest windfarm, said Jess Melin. A Livingston guy, Melin is executive director of renewable development for NextEra Energy Resources.

The company brands itself as the world's largest generator of renewable energy from wind and solar. This 750-megawatt giant is NextEra’s first Montana project. Melin seems to preface all his observations about Eastern Montana with “I’m a little biased.”

The link is to the Billings Gazette, not yet behind a paywall. I've archived it just in case.

An Oasis Hagen Banks Well Has Just Gone Off Line -- December 27, 2021

The well:

27111, 1,071, Oasis, Hagen Banks 5298 42-31 5B, Banks, t7/14; cum 233K 4/19; cum 256K 9/21; off line 10/21;

Seven wells on two neighboring pads. Most off line. Poor wells in general. Looks like it may be time to re-drill some of these locations? The Banks is a very, very good oil field.

******************************
A Norman Rockwell

Flashback: 2015 -- December 27, 2021

These days, on a typical day in the Bakken, one to four wells may come off the confidential list; many days, no wells come off the confidential list, and the average seems to be one or two.

But look at a not atypical day back in 2015.

Thursday, January 8, 2015: 81 for the month; 81 for the quarter

24774, 823, Oasis, Marlene 5501 14-1T, Cow Creek, t7/14; cum 27K 11/14; cum 163K 10/21;
24775, 1,304, Oasis, Herb 5501 14-1B, Cow Creek, t7/14; cum 23K 11/14; cum 159K 10/21;
26458, 1,374, EOG, Wayzetta 45-0311H, Parshall, Bakken NOS, 1920 acres, geologist's narrative and frack data N/A, t6/14; cum 819K 2/20; cum 862K 10/21;
26899, 369, Oasis, Delta 6093 24-15 ST, Gros Ventre, t9/14; cum 17K 11/14; cum 124K 10/21;
26994, 586, Oasis, Emerald 5603 43-10 2B, Bull Butte, t10/14; cum 9K 11/14; cum 56K 10/21;
26995, 701, Oasis, Ross 5603 43-10 2B, Bull Butte, t10/14; cum 10K 11/14; cum 111K 10/21;
27011, 162, Oasis, State 5792 31-15 6T2, Cottonwood, a T2 well, not particularly noteworthy, t8/14; cum 6K 11/14;
27012, 177, Oasis, State 5792 31-15 5T, Cottonwood, a big well for Cottonwood, T1, t8/14; cum 73K 4/19; cum 82K 10/21;
27108, 1,469, Oasis, Hagen Banks 5298 42 31 8B, Banks, t8/14; cum 259K 4/19; cum 279K 10/21;
27111, 1,071, Oasis, Hagen Banks 5298 42-31 5B, Banks, t7/14; cum 233K 4/19; cum 256K 9/21; off line 10/21;
27223, 1,030, Oasis, Mallard 5692 31-22 8B, Alger, erratic production, t8/14; cum 107K 9/15; cum 275K 10/21;
27224, AB/IA/95, Oasis, Mallard 5692 31-22 11T2, Alger, Three Forks, 2nd bench, in July, 2014, 12 stages, 1.8 million lbs; in October, 2014, 24 stages, 3.1 million lbs; t10/14; cum 3K 4/15; on-line for 20 days over 10 months; last produced in November, 2014; produced 46 bbls one day in May, 2015; produced 46 bbls one day in July, 2015; still offline as of 4/19;
27463, 147, Oasis, Shaw 6092 11-236B, Cottonwood, t10/14; cum 9K 11/14; cum 69K 10/21;
27464, 103, Oasis, Shaw 6092 11-23 5T2, Cottonwood, a T2 well, t10/14; cum 6K 11/14; cum 51K 10/21;
27598, 1,158, Oasis, Oasis Meiers 5692 43-18 4T2, Alger, a T2 well, t8/14; cum 24K 9/15; cum 90K 10/21;
27599, 1,754, Oasis, Oasis Meiers 5692 43-18 8B, Alger, t8/14; cum 32K 11/14; cum 236K 10/21;
27602, 1,677, Oasis, Oasis Meiers 5692 43-18 5B, Alger, t7/14; cum 191K 4/17; cum 267K 10/21;
27614, 1,049, Oasis, Andre Shepherd 5501 31-8 7T, Missouri Ridge, t12/14; cum 23K 4/15; cum 120K 10/21;
27641, 1,488, Oasis, Holmes 5501 11-5 3B, Tyrone, a big well for the Tyrone, t11/14; cum 5K 11/14; cum 226K 10/21;
27678, 355, Oasis, Delta 6093 44-15 7B, Gros Ventre, t8/14; cum 26K 11/14; cum 113K 10/21;
28019, 2,590, QEP, Moberg 4-20-21BH, Grail, t11/14; cum 133K 4/15; cum 413K 10/21;
28145, 410, Oasis, Delta 6093 44-15 6T, Gros Ventre, t9/14; cum 30K 11/14; cum 153K 10/21;
28252, DRY, Oasis, Chalmers Wade Federal 5300 44-24 12TX, Baker, surface casing problems; plugged;
28273, 2,445, BR, Copper Draw 11-27MBH, Johnson Corner, 4 sections, t10/14; cum 384K 4/19; cum 451K 10/21;
28310, 48, Cobra Oil / Enduro, MRPSU 19-41, Mouse River Park, a Madison well, t8/14; cum 4K 6/15; cume 23K 10/21;
28342, 951, Oasis, Chalmers 5301 44-24 2TR, Baker, t12/14; cum 32K 4/15; choked way back; cum 168K 10/21;
28376, dry, Armstrong Operating, First Creek 1, a Tyler well, wildcat, no production data, two miles directly north of Amidon (12-153-101) where Tyler wells are being drilled; about 8 miles southwest of Rocky Ridge where Tyler wells are being drilled.
28606, 637, Newfield, Gariety 150-99-36-25-11H, Siverston, t10/14; cum 24K 11/14; cum 165K 10/21;
28666, 2,341, QEP, Johnson 4-9-4BH, Grail, t2/15; cum 135K 4/15; cum 587K 10/21;

A Very Nice EOG Wayzetta Well Recently Taken Off Line -- December 27, 201

Folks might remember a similar EOG well mentioned yesterday, #27193, #27194, #17040).

The well:

26216, 1,440, EOG, Wayzetta 43-0311H, Parshall, 51 stages; 15.8 million lbs; required anti-collision due to existing Wayzetta 9-03H (#16991); 10-foot target window; during the drilling, conditions averaged a temperature of -25 degrees with blizzard-like conditions, effecting drilling operations, 1920 acres, t6/14; cum 145K 11/14; cum 566K 6/21; off line 7/21;

Three wells on that pad: #26216, #26217, #26929:

26217, 424, EOG, Wayzetta 42-0311H, Parshall, t5/14; cum 669K 10/21;
26929, 133/PA, EOG, Wayzetta 148-0311H, Parshall, t6/14; cum 15K 10/15; it appears this well was plugged/cemented on/about9/30/20 under supervision of NDIC inspector.

To the west, a one-section, short horizontal:

17030, 1,967, EOG, Skaar 7-10H, Parshall, t6/08; cum 855K 10/21;

No "action" noted in the area, but the maps are out of date due to NDIC IT problems.

CLR's "Re-Drill" In Noonan Oil Field -- An Update -- December 27, 2021

On January 6, 2015, this well came off the confidential list:

28236, dry, CLR, Nygaardsvold 1-32H, Noonan, surface casing problems; will re-drill;

The re-drill: #28934.

28934, 243, CLR, Nygaardsvold 1X-32H, Noonan, t11/14; cum 268K 10/21; a nice well that has plateaued at 1200 bbls of crude oil per month:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	Vent/Flare
BAKKEN	10-2021	31	1251	1186	4475	1680	1266
BAKKEN	9-2021	30	1332	1623	5517	1740	1336
BAKKEN	8-2021	31	1801	1667	6467	2187	1778
BAKKEN	7-2021	31	1412	1404	4870	1854	1471
BAKKEN	6-2021	30	1551	1670	5400	1965	1564
BAKKEN	5-2021	28	1231	1185	4687	1544	1214
BAKKEN	4-2021	29	1103	992	4171	1429	1062
BAKKEN	3-2021	31	1308	1301	5041	1709	1294
BAKKEN	2-2021	28	1166	1211	5161	1502	1137
BAKKEN	1-2021	31	1170	1215	6431	1544	1146
BAKKEN	12-2020	31	1646	1439	6380	2022	1624
BAKKEN	11-2020	30	1792	1894	6326	2184	1779
BAKKEN	10-2020	31	1701	1661	6295	2071	1671

WTI Surged Almost 3% In Late Morning Trading -- December 27, 2021

The "w" in WTI now stands for "wow": WTI started off weak this morning, but by late morning, WTI had surged almost 3%; up $2.06; and, trading at $75.85.

Louisiana Light: up 2%; up $1.47; trading at $75.32

************************
Merger

No news.

AMD: now up 4.55%; up $6.65; trading at $152.79; 52-week high: $164.46.
XLNX: now up 2.8%; up $6.05; trading at $222.16; 52-week high: $239.79.

RMDS -- December 27, 2021

This is not tax advice. This is for my benefit only. RMDs can be very, very confusing. On the way to looking up something else, I happened to come across a couple of interesting links.

All good news if I'm interpreting things correctly. I often mis-read things. If this is important to you, go to the source.

RMDS
New "IRS longevity tables" in 2022? Link here.

Example, a single 75-year-old woman whose IRA is worth $100,000 at the end of 2021 will have to withdraw a minimum of $4,065 in 2022, about $300 less than she would have under the earlier guidelines

Link here for more comprehensive review. Three years compared:

tax year, 2020;
tax year, 2021;
tax year, 2022;

For tax year 2021, regarding non-spouse / non-eligible designated beneficiaries who inherit an IRA after 2019 are subject to a new 10-year payout rule and do not use this or any table.

But look at this, for tax year 2022 (tax will be due April 15, 2023):

new longevity tables (to the taxpayers' advantage; and,
then this:

The IRS included a transition rule for non-spouse beneficiaries who inherited an IRA prior to January 1, 2022 after RMDs have begun, and who are currently using the Single Life Table. The transition provides a “reset” for the life expectancies using the new tables. Therefore, table changes for 2022 will be more complicated.

There will be a one-time reset (“redetermination”) of the life expectancy that year. The beneficiary will “go back” to the year after the year of owner’s death and find his/her (i.e., beneficiary’s not the deceased) single life expectancy as of his/her age in that year using the new table. Subsequently, one year will be deducted from the new life expectancy for each year since the first distribution year to arrive at the divisor for the relevant post-2021 year.

The Santa Claus Rally Commences -- December 27, 2021

The "w" in WTI now stands for "wow": WTI started off weak this morning, but by late morning, WTI had surged almost 3%; up $2.06; and, trading at $75.85.

US retail sales: blow away expectations. Record spending everywhere.

OPEC basket price: link here.

2012: $110
2016: $40
today: $70

S&P 500: trades at new intraday high.

Dow: above 36,000 again, but still below its all-time high.

First group "financial / economic" indicators:

10-Year Treasury: link here. Down -- 1.477%.
DXY: link here. Yawn. 96.09.
Silver: link here.Broke through $23.
CBOE volatility index: link here. Up almost 3%; 18.43.

Merger: no news.

AMD: up almost 4%; up $5.66; trading at $152;
XLNX: up almost 2%; up $4.00; trading at $220;
XLNX shareholders to get 1.7234 shares of AMD per share of XLNX

******************
RMDS

New "IRS longevity tables" in 2022? Link here.

Example, a single 75-year-old woman whose IRA is worth $100,000 at the end of 2021 will have to withdraw a minimum of $4,065 in 2022, about $300 less than she would have under the earlier guidelines

Link here for more comprehensive review. Three years compared:

tax year, 2020;
tax year, 2021;
tax year, 2022;

For tax year 2021, regarding non-spouse / non-eligible designated beneficiaries who inherit an IRA after 2019 are subject to a new 10-year payout rule and do not use this or any table.

But look at this, for tax year 2022 (tax will be due April 15, 2023):

new longevity tables (to the taxpayers' advantage; and,
then this:

The IRS included a transition rule for non-spouse beneficiaries who inherited an IRA prior to January 1, 2022 after RMDs have begun, and who are currently using the Single Life Table. The transition provides a “reset” for the life expectancies using the new tables. Therefore, table changes for 2022 will be more complicated.

There will be a one-time reset (“redetermination”) of the life expectancy that year. The beneficiary will “go back” to the year after the year of owner’s death and find his/her (i.e., beneficiary’s not the deceased) single life expectancy as of his/her age in that year using the new table. Subsequently, one year will be deducted from the new life expectancy for each year since the first distribution year to arrive at the divisor for the relevant post-2021 year.

Three Wells Coming Off Confidential List -- December 27, 2021

Active rigs:

$73.58	12/27/2021	12/27/2020	12/27/2019	12/27/2018	12/27/2017
Active Rigs	32	13	56	67	51

Monday, December 27, 2021: 84 for the month, 113 for the quarter, 339 for the year:

38379, conf, Rampart Energy, Coteau 1, wildcat, no production data;

Sunday, December 26, 2021: 83 for the month, 112 for the quarter, 338 for the year:

36997, conf, CLR, LCU Ralph Federal 7-27H1, Long Creek, no production data,

Saturday, December 25, 2021: 82 for the month, 111 for the quarter, 337 for the year:

36998, conf, CLR, LCU Ralph Federal 6-27H, Long Creek, no production data,

RBN Energy: what's driving the wider WCS / WTI price spreads, part 2.

You would expect the start-up of Enbridge’s Line 3 Replacement project early this fall to have eased the constraints on crude oil pipelines from Western Canada to the U.S. — and it did. You’d also expect that L3R coming online would narrow the price spread between Western Canadian Select and West Texas intermediate — but it didn’t. The latest widening of the WCS-WTI spread, one of many in recent years, is another reminder that oil price differentials can be affected by many factors other than pipeline capacity availability. In today’s RBN blog, we discuss the host of issues that affect this all-important Canadian oil price metric.

Over the past two decades, Canadian crude oil producers and shippers have often found themselves short of pipeline capacity to transport rising production to the U.S., their primary export market. These episodes typically resulted in deeper price discounts for Western Canadian Select (WCS) and other crude oil streams out of Canada versus West Texas Intermediate (WTI).

The solution would seem to be simple: Add more pipeline export capacity to reduce or eliminate the periods of deeper WCS price discounts. Building out new pipeline capacity has proven to be an immense regulatory and legal challenge over the years, but expansions have still occurred, with the latest addition being an upgrade to part of the existing Enbridge Mainline network, a series of crude oil pipelines that link Alberta to refiners in the U.S. Midwest, as well as important refiner destinations in Eastern Canada.

Focus On Fracking -- December 26, 2021

Weekly edition for this week has been posted.

The lede:

SPR at a 19-year low; total oil & products supplies near a 7-year low; distillates demand falls most in 5 years; DUC backlog at 5.5 months.

Pages

Monday, December 27, 2021