Friday, March 18, 2022

Week 11: March 13, 2022 -- March 19, 2022

Top story of the week:

Top international non-energy story of the week:

Top international energy story of the week:

Top national non-energy story of the week:

Top national energy story of the week:

Top North Dakota non-energy story of the week:

Top North Dakota energy story of the week:

The Energy Chaser: The Williston Herald, Renée Jean;

Geoff Simon's top North Dakota energy stories:

Operations:

Operators:

Wells:

Fracking:

Natural gas:

Pipelines:

Bakken economy:

Commentary:

Notes From All Over -- March 18, 2022

The BIG STORY and the THEME this week in the energy sector has been: panic among the Washington (DC) incumbents

The price of gasoline has finally caught the attention of the Washington (DC) incumbents, both parties, and the governors of "selected" states.

First up: Maryland lifts the gasoline tax for 30 days. So, a gallon of gasoline will drop from $4.35 to $3.99. Three-ninety-nine sounds a lot better than anything that starts with a four-dollar handle.

But look at this: the Biden administration plans to resume plans for federal oil and gas development. Reported by Reuters. I don't even want to read the article; I didn't want to be disappointed. The headline was enough. Greta is arranging a support group meeting this week for herself, Bernie Sanders, Pocahontas, and Occasional Cortex.

Russia: has proposed tax relief for the oil industry.

Mexico: will halt plan to cut exports. Wow, huge story. Pemex will not meet export-cut target to boost domestic supply.

Market: wow, I'm in a great mood. That very small part of my overall portfolio that I manage all by myself -- is at an all-time high, but just barely. Once oil stocks catch up with the price of oil, and once AAPL gets back to $175, I will be able to retire. Again. 

Bad news: it's clear that no matter how the west wants to "spin" the valor of the Ukrainian people, Putin plans to take the whole country. 

Halliburton: suspends future business in Russia.

High oil prices have not spurred new drilling in the US oil patch. The sustained production is due to DUCs being completed. Link here. No acceleration of US shale rig counts despite oil price being over $100 / bbl. Labor, frack sand, and pipes are issues. And it's not the drilling that matters; it's the frack spreads.

Permian employment: the number of oil workers in the Permian has jumped by 20% in the past week.

Bullish: tech majors like AMZN and NVDA have "reclaimed" their 50-smas, a positive trend signal. ["50-sma" = 50-day simple moving average.]

Travel: US booking sites seeing strong demand for 2022 travel.

Porsche and Apple extend partnership.

And that’s just beginning.

Ringo Starr:30th Annual R'n R Induction Ceremony, 2015

One New Permit; Three DUCs Reported As Completed -- March 18, 2022

Active rigs:

$104.70
3/18/202203/18/202103/18/202003/18/201903/18/2018
Active Rigs3716556558

One new permit, #38841:

  • Operator: Bowline Energy
  • Field: Briar Creek (Williams County)
  • Comments:
    • Bowline Energy has a permit for a Heen S well in SWSE 35-153-103, Williams County, Briar Creek, 
    • to be sited 270 FSL and 1525 FEL

Three producing wells (DUCs) reported as completed:

  • 31361, 1,848, Grayson Mill Operating,
  • 31466, 910, Grayson Mill Operating,
  • 38209, 1,867, Ovintiv Production

For Investors -- March 18, 2022

March 18, 2022, mid-day, from CNBC

March 18, 2022: Toyota, major chip supplier suspend production due to Fukushima earthquake. Toyota to suspend operations at more than fifty percent of facilities across Japan.

About Those 9,000 Permits -- March 18, 2022

9,000 permits: that's the number of permits the White House press secretary says the oil industry is sitting on, the number of permits that they "stockpiled" in anticipation of a Biden presidency. 

They say that is more than adequate if US shale would just drill those permits.

Today, it is announced that the number of active rigs in the US now total 766 rigs.

 

Back-of-the-envelope:

  • 9,000 / 766 = 12
  • those 766 rigs could each drill twelve wells and the 9,000 locations/permits would be exhausted
  • a rig can easily drill one well every two weeks
  • 12 x 2 = 24 weeks
    • March: 2
    • April: 4
    • May: 4
    • June: 4
    • July: 4
    • August: 4
    • September: 2
  • by mid-September, 2022, those 766 rigs could drill those 9,000 locations
    • just in time for the mid-term elections
    • am I missing something here?
  • something tells me that the White House press secretary is either unaware of how fast US shale can drill and / or is unable to do the math
    • or both

By the way, that 766-rig count was from March 16, 2022. Since then, the rig count in North Dakota has jumped two or three rigs based on NDIC's daily activity report. 

Bad News On Two Accounts Coming Out Of The Mideast -- March 18, 2022

Both of these stories were posted earlier this morning. Now we get the updates.

The myth of spare capacity: it's now being reported that OPEC+ missed its production target (and the bar was set very low) by one million bopd. One link here.

Blinken: earlier it was reported that US Secretary of State was heading to / already in the Mideast to meet with his counterparts in Saudi Arabia and UAE. It's now being reported that those meetings are not happening "this month." 

Or perhaps ever.

I don't know about you, but it certainly seems OPEC+ doesn't like the US. My assumption is that Saudi will start to purchase military hardware and technology from Russia, not the US. 

Things are never so bad that they cannot get worse. President Biden has that skill set to make that happen. Paraphrasing former President Obama.

Is Orca Living Up To Its Namesake? March 18, 2021

The well:

  • 37424, loc/NC, Slawson, Orca Federal 3-23-26H, Big Bend, first production, 11/21; t--; cum 34k 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-20222523312230312325621276021153
BAKKEN12-202100350000
BAKKEN11-20216106741043011949981009782
BAKKEN10-20211459044394070402
BAKKEN9-202130000000

A Slawson Osprey Federal Well In Big Bend -- Came Off Confidential List One Year Ago -- March 18, 2022

The decline rates for Bakken wells are considerably less severe. Here's another example. 

The well:

  • 36250, conf-->loc/NC-->1,753, Slawson, Osprey Federal 3-26-29H, Big Bend, first production, 4/21; cum 203K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-20223017797172292352611029010878
BAKKEN12-202126127651315220498791507786
BAKKEN11-20212719024187433076411915011780
BAKKEN10-20212920894214424117113173013028
BAKKEN9-20212925966256965084716510016364
BAKKEN8-20213127503274485580617208017054
BAKKEN7-20213024182245745318815271015121
BAKKEN6-20212020557195534341013324013222
BAKKEN5-202117119141216929706764107556
BAKKEN4-20212922064215104571912712012567
BAKKEN3-20212007461108401075

 

Update A Few Petro-Hunt Phelps Bay Wells That Came Off Confidential One Year Ago -- March 18, 2022

The wells:

  • 37461, conf->F/A, Petro-Hunt, USA 153-95-13C-12-3H, Phelps Bay, first production, 3/21, t--; cum 253K 1/22; cum 253K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-202231145561452879685059950276107
BAKKEN12-202131170631718394655935058202932
BAKKEN11-20213019869199391056658204557202275
BAKKEN10-20213122221220251045751759469584585
BAKKEN9-20213023440235711016246631409305492
BAKKEN8-2021312680526747108874737847048114
BAKKEN7-20213126292262751118644218392974705
BAKKEN6-202130255932568011988421474185286
BAKKEN5-2021313069830773150384914848461471
BAKKEN4-20213033264329851437854657509193529
BAKKEN3-202131101151014084741351712464837
BAKKEN2-2021285277758088480961
BAKKEN1-202111600000
BAKKEN12-2020523271934232923432193117
  • 37460, conf-->F/A, Petro-Hunt, USA 153-95-13C-12-4H, Phelps Bay, first production, 12/20; t--; cum 30K 1/21; cum 340K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-202231124161243075735578555327242
BAKKEN12-2021311446014505825265361618023343
BAKKEN11-20213017293174189541713054071930377
BAKKEN10-202131198951972210595657814612219443
BAKKEN9-202130223212238810243625893772724653
BAKKEN8-20213127137271841152462240583813643
BAKKEN7-20213123763236441210143317384654636
BAKKEN6-2021302286422889127023894738373365
BAKKEN5-202131333363336413919576114511012285
BAKKEN4-202130372363734114510576974163615852
BAKKEN3-202131427604332918909722315979512220
BAKKEN2-2021283587935274182915742957087147
BAKKEN1-2021312190721772118453245831671571
BAKKEN12-20201485718144111401046010102281
  • 37459, conf-->loc/A, Petro-Hunt, USA 153-95-13D-12-5H, Phelps Bay, first production, 12/20; t--; cum 33K 1/21; cum 263K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-2022318822869979403782737409202
BAKKEN12-20213199621008596194349042593681
BAKKEN11-2021301127411162975247450407086533
BAKKEN10-20213113602136339653530453414418685
BAKKEN9-202130156291567010789549034104813646
BAKKEN8-20213119545195451279658680553893075
BAKKEN7-20213121797216971293650160434926452
BAKKEN6-20213017071171661097030397240956093
BAKKEN5-2021312490324800126764225241287749
BAKKEN4-20213026516265801734545983416934081
BAKKEN3-202131332603332122671594244459014618
BAKKEN2-202128268622663120495460614582640
BAKKEN1-2021312175621885145503383532915704
BAKKEN12-202020115331108495821406613711271

Updating The WPX Crosby Chase Wells -- March 18, 2022

By the way, quick! Who now "owns" WPX?

Periodically I go through the "new wells reporting" list. Here are a few wells from a year ago, 1Q21, that came off the confidential list at that time but had not posted any production. 

No cherry picking. This was simply the very first one that popped up:

  • 37308, drl/NC-->drl/A, WPX, Crosby Chase 2-1HC, Spotted Horn, first production, 5/21; t--; cum 236K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-20223114143141551098317422585010882
BAKKEN12-202131208192067613658303961549814553
BAKKEN11-20213020966210331182726438262060
BAKKEN10-20213123926238251452527156217934950
BAKKEN9-202130274612736913823329541971412815
BAKKEN8-20213126859268591812027342230434010
BAKKEN7-20213147048473643243747895392908450
BAKKEN6-20213048434484623821860090560149147
BAKKEN5-202125938559539401100

Others:

  • 37704, drl/NC-->947, Petro-Hunt, USA 153-95-11C-2-1HS, Charlson, first production, --; t2/21 cum 247K 1/22;
  • 37307, drl/NC-->drl/A, WPX, Crosby Chase 2-1HY, Spotted Horn, first production, 5/21; t--; cum 272K 1/22;

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-202231189161888113663285061006617750
BAKKEN12-202131239692385417331309201713013445
BAKKEN11-20213032542325142198940491402270
BAKKEN10-20213120869207961445423686188904448
BAKKEN9-202130286382854220602311581864012093
BAKKEN8-20213132268322682932033398250258362
BAKKEN7-202131542965459545620561962080335393
BAKKEN6-20213045961465114317057062457447410
BAKKEN5-202181471713868131254300
  • 37306, drl/NC, WPX, Crosby Chase 2-1HG, Spotted Horn, first production, 6/21; t--; cum 266K 1/22;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-202231197771977097831855682189648
BAKKEN12-202131273872715814968331391895913835
BAKKEN11-20213020923210101236626524263040
BAKKEN10-20213126379262691535131549251226017
BAKKEN9-202130310293092519212312151867312117
BAKKEN8-20213128986289861533629160212917610
BAKKEN7-20213153271536502704253591482855151
BAKKEN6-20212658150577714208671250653058361
BAKKEN5-20210000000
  • 37305, drl/NC, WPX, Crosby Chase 2-1HZ, Spotted Horn, no production data, see this post;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN1-202231127001276198411453254528412
BAKKEN12-202131225982247417242302821659013358
BAKKEN11-20213027981279992045335014347680
BAKKEN10-20213123132230411724226301211164773
BAKKEN9-202130285212842521528318581905812375
BAKKEN8-20213125179251792179926111201625938
BAKKEN7-202131477974812840172495662858120985
BAKKEN6-20213050888509194581263797558152611
BAKKEN5-202146275591357132100

I'm going to quit here. I need to update the Crosby Chase post. LOL. The Crosby Chase wells are tracked here.

The Panic Is Really Setting In -- Now Macron Says Its Time To Nationalize Oil -- March 18, 2022

Can you imagine Macron running an oil company? Link here. I would provide the Bloomberg link but I'm getting tired of the paywalls.

Nationalize US oil: I said it would never happen, but an astute reader pointed out that one can nationalize any industry different ways. Through Congressional action or executive orders, the government can issue rules and regulations that have the same effect as the "classic" method of nationalizing something. 

Tags: do I need a new tag for the blog, "the 2022 oil panic"?

Amazing! Already Friday; One Well Coming Off Confidential List; Oil Continues To Melt Up -- March 18, 2022

SPR: others do, but I don't. I don't buy into the seriousness of the depletion of the SPR. But, for the record

Incredibly serious: the other day I mentioned that world leaders were not taking phone calls from Joe Biden.  

Now this: US SecState flies to Mideast to speak with counterparts. Saudi Foreign Ministry official: no meeting has been scheduled with US Sec State Blinken. It will probably happen but Saudis will let Blinken cool his heels for a few days, giving him a chance to get over jet lag. 

Why US shale is cautious: lousy piece by Robert Rapier over at oilprice.com. I would not have bothered to link this except for this paragraph:

Thus, we have oil production that can’t bounce back quickly because some has been shut in, and new production that can’t proceed as quickly due to manpower and material shortages (e.g., fracking sand). It’s not simply that oil companies are sitting on permits. They are working through them. The number of rigs drilling for oil and gas has risen by 60% over the past year. But it can take years for a permit to translate into oil production (if the location even yields oil).

Absolutely not true for the Bakken,
  • where there is "never" a dry hole; and,
  • from permit to production, six months
Update on XOM and the Bakken: no news and maybe won't even happen. Link to Zacks.
I don't think XOM can find a single buyer for its Bakken package.

Did y'all see this yesterday? DVN at the top. 

One of the best blog posts I ever did was on Devon, last August 21, 2021. Readers must like it also; it's the number one hit when searching for Devon on the blog. I don't get many things right, but I right on with this one. I did not buy Devon at the time -- or at least I don't recall buying Devon -- but since then have built a nice position, simply through serendipity. 

Teslas waiting in line to get re-charged: link here. We've been talking about this for years on the blog, but this is a new wrinkle. 

When a bank of Tesla charging stations are filled, the charging process can take twice as long -- simply too much electricity demand for supply available. Folks in Louisiana, along I-10, had an hour wait or longer to re-charge. But when they get home they will rave to their neighbors how great their trip was. 

Jim Cramer: do you remember the recent story in which Jim Cramer said he would never tough "oil" again. 

Never mind. His eleven top picksas compiled by this producer: the top four -- Pioneer Natural Resources, Coterra Energy, Devon Energy, and Halliburton. Two were banks/financial: #10 and #11; Wells Fargo and American Express. One was a semiconductor, #8, NXP Semiconductors. In another Jim Cramer list, which I did not keep/link, he mentions 15 stocks to stay away from. Two of them Rivian and ATT. ATT was at the top of his list to avoid.

Oil:

  • WTI: up 1.4%; up $1.42; trading at $104.40, pre-market.
  • Brent: up 2.26%; up $2.41; trading at $109.10, pre-market.
  • expect to see/hear more signs of panic coming out of Washington (DC)

****************************
Back to the Bakken

Active rigs:

$104.40
3/18/202203/18/202103/18/202003/18/201903/18/2018
Active Rigs3516556558

Friday, March 18, 2022: 31 for the month, 140 for the quarter, 140 for the year

  • 38450, conf, CLR, Jack 9-9HSL,

RBN Energy: carbon-capture projects hold promise, but hurdles remain, part 6. I suppose some day I will with I had archived this, but I just can't get excited about any of this. I'll let others follow it if they want, but not me. except for headline stories and significant stories coming out of North Dakota.

When U.S. lawmakers introduced the 45Q tax credit in 2008, they were planting a seed they hoped would one day sprout into a flourishing carbon-capture industry. As the years wore on and the number of successful projects remained small, they added a little fertilizer in 2018, not only enhancing the value of the credits but easing some of the limitations in the earlier legislation. It’s now 2022 and, with climate concerns and the energy transition at top of mind, Washington is again looking at ways to make the tax credit more effective and spur new growth in carbon-capture projects. In today’s RBN blog, we look at how economic and technological challenges have so far limited the success of carbon-capture initiatives.