Five New Permits; A Horizontal Re-Entry Approved; Fifteen Permits Renewed; Two Permits Canceled; One DUC Reported Completed -- September 6, 2022

Natural gas: I've said from the beginning, I have a pretty good understanding of oil -- understanding maybe five percent of all there is to know, but I have no understanding of natural gas. After years of blogging, I have learned one thing about natural gas. Producers can produce a lot of it very quickly, if necessary. And today, we see it again. From Charles Kennedy:

And that's why I've never been a big fan in investing in pure-play natural gas producers. From the linked article:

U.S. natural gas futures shed around 5% on Tuesday, hitting a four-week low as soaring output coupled with lower demand forecasts drags prices down, despite the fact that inventories are 11% lower than their five-year norm. Output is still holding strong after the latest report from the Energy Information Administration (EIA) for the week ending August 26, which showed a natural gas inventory build of 61 billion cubic feet. While that brings inventory to 2,640 Bcf, it is still 228 Bcf below levels at the same time last year–heading into the winter season. 

Also prompting the decline is the outage at the key Freeport LNG export plant on the Gulf coast. 

That outage means traders are calculating some 2 billion cubic feet of gas per day that is not being consumed by Freeport for export and is remaining on the domestic market.

Freeport–which accounts for some 20% of U.S. LNG export capacity–looks set to remain offline until sometime in the first half of November, at which point we could see only a partial startup, ramping up to full capacity by the end of that month. Freeport, however, has already pushed back a restart date several times since declaring force majeure–and then revoking it–in June. 

I anticipated this on August 20, 2022.

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Back to the Bakken

Active rigs: 43.

WTI: $86.75.

Natural gas: $8.021

Five new permits, #39224 -- #39228, inclusive:

• Operator: Hess
• Field: Beaver Lodge (Williams)
• Comments:
• Hess has permits for three BL-Herfindahl wells and two BL-Domy wells, all in NENE 30-156-95; 
• to be sited 655 FNL and between 762 FEL and 894 FEL. 

Horizontal, re-entry, approval:

• 38417, Liberty Resources, Az W 158-93-13-24-1MBH,

Fifteen permits renewed:

• Enerplus (9): the following permits in Dunn County: Troop; Skulk, Canidae, Fennec, Sly, Vulpes, Kit, Renard, and Swift
• XTO (3): three Carus State Federal permits in Dunn County;
• Petro-Hunt (3): three State permits in McKenzie County;

Two permits canceled:

• Whiting: a KCH Murphy LW permit (Mountrail County) and a Cymbaluk Federal permit, Stark County;

One producing well (a DUC) reported as completed:

• 38599, 761, Murex, Borstad 34-10H-1 2MB, West Tioga, Williams County; t--; cum no production data;  --;

Hess cancels five SC-Bingeman permits.