Pages

Friday, July 29, 2022

WPX Brings An Old Well Back On Line -- July 29, 2022

After being off line since 10/19, it appears WPX is bringing this well back on line. After no production since 10/19, it produced 31 days in June, 2022.

The well:

  • 17943, 716, WPX, Alisia Fox 16-9H, Mandaree, t11/09; cum 126K 6/22; recent production:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN6-20223194031182820
BAKKEN5-20220000000
BAKKEN4-20220000000
BAKKEN3-20220000000
BAKKEN2-20220000000
BAKKEN1-20220000000
BAKKEN12-20210000000
BAKKEN11-20210000000
BAKKEN10-20210000000
BAKKEN9-20210000000
BAKKEN8-20210000000
BAKKEN7-20210000000
BAKKEN6-20210000000
BAKKEN5-202113650504
BAKKEN4-20210000000
BAKKEN3-20210000000
BAKKEN2-20210000000
BAKKEN1-20210000000
BAKKEN12-20200000000
BAKKEN11-20200000000
BAKKEN10-20200000000
BAKKEN9-20200000000
BAKKEN8-20200000000
BAKKEN7-20200000000
BAKKEN6-20200000000
BAKKEN5-20200000000
BAKKEN4-2020001780000
BAKKEN3-20200000000
BAKKEN2-20200000000
BAKKEN1-20200000000
BAKKEN12-20190000000
BAKKEN11-201925602465257
BAKKEN10-2019295525211137475260
BAKKEN9-2019305145212788336130
BAKKEN8-2019277846841749657420
BAKKEN7-2019109001081080
BAKKEN6-20193058861257094930
BAKKEN5-2019315906451558686340
BAKKEN4-2019294764183858276200
BAKKEN3-201927808694181934540164
BAKKEN2-201921062673243210
BAKKEN1-2019697194282632180
BAKKEN12-2018284614612085913950
BAKKEN11-201830485446996894720


A Veeder Well With History Of "Struggling," Recently Off Line, Is Now Back On Line -- July 29, 2022

From a previous post:

May 13, 2019: #16357, struggling; strange profile; a Veeder well in Blue Buttes, BR; remains off line 12/19; IA; A as of 12/19; no production 12/19 or 1/20; five days in 2/20; zero days, 3/20; three days, 4/20; zero days 5/20; 1 day, 6/20; 4 days, 9/20; struggling; 10/20, struggling; cum 282K 10/21; off line 1/22; back on line 6/22; cum 282K 6/22;

The Veeder wells are tracked here.

Screenshot of scout ticket:

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN6-202282332401081456140040
BAKKEN5-202210001941940
BAKKEN4-20220000000
BAKKEN3-20220000000
BAKKEN2-20220000000
BAKKEN1-2022100069690
BAKKEN12-202110420253763360
BAKKEN11-2021302502535804600
BAKKEN10-202131142242211137112470
BAKKEN9-202130417483521329032310
BAKKEN8-202129650687909277327160

A Whiting Richardson Federal Well, Tracked For Years, Just Went Over One Million Bbls Crude Oil Cumulative -- July 29, 2022

Note: a reader wants me to point out this well is not a typical Bakken well. Whatever.

From a previous post, back in 2016:

*******October 11, 2016: #17158; bump in production after neighboring well fracked; note how little time this well was taken off-status while neighboring well was fracked; see if this well goes 1 million bbls without being put on a pump; 987K 11/20; 

The well

  • 17158, 4,148, Whiting, Richardson Federal 11-9H, s8/08; t10/08; 997K 1/22; F; at 600 bbls / month it's going to take a year to hit one million bbls.

So, let's see where we're at, six years later.

Wow, wow, wow .... what serendipity ... this well literally just went over one million bbls crude oil cumulative.

Screen shot of scout ticket:

  • just went over one million bbls crude oil cumulative;
  • flowing, never put on a pump

Recent production:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN6-20223052253691450444440
BAKKEN5-202231695724123466045980
BAKKEN4-20222148543769337322971037
BAKKEN3-202231623643157349734350
BAKKEN2-2022285625702343087301022
BAKKEN1-202231711714241419541330
BAKKEN12-202131779768265456645040
BAKKEN11-202130698713137479147310
BAKKEN10-202131691613117507250100
BAKKEN9-202130628708209486748070
BAKKEN8-20213164561866475847517
BAKKEN7-202131774751534793469697
BAKKEN6-20213063364356466746670
BAKKEN5-202131723818103541454140
BAKKEN4-202130715645137505550550
BAKKEN3-202131812794107555854960

Coal And The Jevons Paradox -- July 29, 2022

Link here.

Wiki entry.

In economics, the Jevons paradox (/ˈdʒɛvənz/; sometimes Jevons effect) occurs when technological progress or government policy increases the efficiency with which a resource is used (reducing the amount necessary for any one use), but the falling cost of use increases its demand, negating the efficiency gains. The Jevons' effect is perhaps the most widely known pitfall in environmental economics. However, governments and environmentalists[needs update] generally assume that efficiency gains will lower resource consumption, ignoring the possibility of the effect arising.
In 1865, the English economist William Stanley Jevons observed that technological improvements that increased the efficiency of coal-use led to the increased consumption of coal in a wide range of industries. He argued that, contrary to common intuition, technological progress could not be relied upon to reduce fuel consumption.
The issue has been re-examined by modern economists studying consumption rebound effects from improved energy efficiency. In addition to reducing the amount needed for a given use, improved efficiency also lowers the relative cost of using a resource, which increases the quantity demanded. This counteracts (to some extent) the reduction in use from improved efficiency. Additionally, improved efficiency increases real incomes and accelerates economic growth, further increasing the demand for resources. The Jevons' effect occurs when the effect from increased demand predominates, and the improved efficiency results in a faster rate of resource utilization.

Week 30: July 24, 2022 -- July 30, 2022.

Javier Blas: Coal is king

Focus on fracking: link here.

Top story of the week:

  • Joe Biden is still president.
    • recovers from the sniffles;
  • without question: the most incredible day or two in the market; as exciting as any in quite some time
    • Intel, Roku, Meta crater
    • Apple, Amazon soar
    • GM in trouble; Ford surprises

Top international non-energy story:

  • The Ukraine war drags on.

Top international energy story:

  • Situation continues to worsen in Europe; countries returning coal
    • use of coal will set a new all-time record in 2022
  • Critical Russian turbine for Nord Stream 1 is apparently still held up in Germany after being "returned" from Canada

Top national non-energy story:

  • "January 6th" hearings continue — compelling.

Top national energy story:

  • WTI surges; after President Biden announces another 20-million-bbl sale from thee SPR, WTI soars; gains 5%; closes right around $100
  • oil companies reporting record quarterly earnings; US reaction muted as gasoline prices are dropping but average price across the US is still around $4.26 / gallon

Top North Dakota non-energy story:

Top North Dakota energy story:


Geoff Simon's top North Dakota energy stories:

Bakken economy:

Commentary:

Friday Night Rambling -- July 29, 2022

I try to get out to the pool three times a day. I'm on the treadmill every morning and then cool off in the pool after that. Mid-afternoon, at the hottest part of the day, I return. Then, in the evening, I'm back for the best time of day. 

That's where I am now. 

Every time I'm in the pool I'm reminded of Palm Springs, California. I've never lived there but I've visited and have seen at least one documentary on the city, as well as spotting scenes of Palm Springs in movies. 

Our apartment complex has two pools, the big pool and the small pool. Both have their "benefits." I used to prefer the small pool; now I prefer thee big pool unless it gets too noisy as it often does on the weekends. Then I move to the small pool.

The personality that most intrigues me and with whom I most identify with Palm Springs: Nancy Sinatra. I just cannot imagine how she survived her childhood, middle school, high school, and coming of age years. 

I'm at the pool this evening, currently 8:40 p.m. and when I came out here about thirty minutes ago, it was 90° according to one website and 88° at another website.

Perfectly still, no wind, no mosquitoes or any bugs for that matter, including no flies, 

With what little light there still is, I'll read some more of my book for the week.

I'm listening to Leonard Cohen's Ten New Songs

Flashback: Richard Zeits On "Array Fracking" In The Bakken -- March 8, 2013

In the process of going back to see if there was a nice article on "spacing units" and/or "drilling units" I came across this Richard Zeits article over at SeekingAlpha: Bakken: the downspacing bounty and birth of array fracking." Wow, incredible. I'm amazed it is still available and not behind a paywall.

Slawson Looks To Drill Four Wells On An Existing 640-Acre Unit In Big Bend -- July 29, 2022

From NDIC hearing dockets June 23, 2022:

  • Case (not a permit): 29435, Slawson, four wells on an existing 640-acre unit; Big Bend-Bakken, section 28-152-92; Mountrail County;

A couple of wells sited in that section:

  • 26991, 508, Slawson, Zulu 5-21H, Van Hook, t8/14; cum 242K 5/22;
  • 29996, 401, Slawson, Shakafox 5-28-21TFH, Big Bend, t3/15; cum 169K 5/22;

No New Permits; CLR With Five Renewed Permits -- July 29, 2022

WTI: $98.62.

Natural gas: $8.229

Active rigs: 44 according to the NDIC daily activity report.

No new permits.

Five permits renewed:

  • CLR: all in Williams County, two Charleston permits, two Olympia permits, and one Juneau permit.

Release The Kraken! July 29, 2022

For the past 72 hours, ABC Evening News et al have tried their hardest to scare the
American public into a panic over monkeypox, a sexually transmitted disease accelerated through male homosexual orgies. 

Didn't work.

Release the kraken!

Start hoarding chocolate now. You have the rest of July (this weekend), August, September, and almost all of October to get all the chocolate you think you might need. 

Off the net for an hour.

My wife and I are headed to Target to start hoarding. I'll report back.

***********************
The Twins Turned Two Years Old A Couple Of Months Ago

They speak three languages:

  • sign language to communicate with their parents
  • twin language between the two of them
  • very, very early English -- delayed due to "twin language"

ERCOT -- For The Archives -- July 29, 2022

We have no natural gas, only electricity.

This is our only energy utility bill, our entire energy / utility bill.

This is the hottest July we've had in years; note the average high temperature this year compared to previous month and year-over-year.

Also, note that we had two more days in the billing cycle than the previous month.

85.50 / 32 = 2.671875 * 30 days = $80.16.

The past month, this billing cycle, ABC Evening News et al was laser-focused on whether the Texas grid would hold. Folks wrote to tell me that ERCOT spot price was $5,000 for MWh on the really, really hot days.

And here you have it: a "bill" for $85 for the month of July for electricity. 


So, $85 for the month of July, 2022.

Q & A -- July 29, 2022

Updates

July 30, 2022: the original post was in reply to a reader who had a question about the Bakken. Instead of responding by e-mail, I replied with a post on the blog. That is generally how I do things. I don't want to get into an e-mail relationship, with some exceptions.  I received several notes regarding my original post, most regarding the "impossibility" of any small mom-and-pop Bakken mineral owner having mineral rights across all of western North Dakota.

I followed up with the individual but want to maintain anonymity so will provide just enough information to show this was accurate in this reader's case.

The reader has mineral rights in the following counties in western North Dakota and eastern Montana:

  • Divide
  • Renville
  • Richland (Montana)
  • Roosevelt (Montana)
  • Valley (Montana)
  • Billings
  • Golden Valley
  • McKenzie
  • Dunn
  • Williams

In many of these counties, the reader owns multiple parcels. In many of the counties, the reader has mineral rights in only one section, and generally amounts to only a net-mineral acre or so in any one section. I have no idea what the particulars are.

For example:

  • Divide County:
  • Township XXX North, Range XXX West
  • Colgan oil field
  • section XX: NW1/4

The reader has never farmed and owns no surface rights. The reader obtained some/many of these net one-acre minerals through "barter" to pay for goods and services in a business unrelated to oil. Others were bought from individuals on a cash basis; some may have been bought through quarterly states lease sales. Again, I don't know the particulars. 

Folks seem to forget that one could buy mineral acres for as little as a dollar in North Dakota and lot of that was done in the 1950s and 1960s. The state continues to hold those quarterly lease sales; I post them every quarter. And some mineral acreage can still be bought for $2 / acre. 

Disclaimer: the information provided by the reader is accurate. My additional comments may be incorrect in some places; I don't understand all there is to understand about minerals, but I'll stop here; this is getting pretty far afield. 

The important point is not who owns minerals and how they were obtained. The reader simply wanted to know how long the checks would last and that was my focus.

Later, 8:11 p.m. CT: see comments. A reader had a question about the definition of a "drilling unit." On the blog I use the terms "drilling unit" and "spacing unit" interchangeably. Many folks do. If one reads the monthly NDIC hearing dockets, one will see what is meant by a "spacing unit" ("drilling unit"). The standard "spacing unit" in the Bakken is now 1280 acres; in the early days, the standard "spacing unit," or "drilling unit" was 640 acres. Hopefully that clears things up. 

In the process of going back to see if there was a nice article on "spacing units" and/or "drilling units" I came across this Richard Zeits article over at SeekingAlpha: Bakken: the downspacing bounty and birth of array fracking." Unfortunately that article is behind a paywall. One may get a number of "free" articles each month; if so, one may get lucky and access this article sometime down the road. More here.

Another reader was surprised that small mom-and-pop mineral owners might own mineral rights in spacing units across the entire Bakken. In the 1950s and 1960s, well before the Bakken revolution, it was not unusual for folks to "trade" a few mineral acres or pay for goods and services with one or two mineral acres. The result was that some some small mom-and-pop mineral owners ended up with minerals across the Bakken. It is/was a very interesting (and unique) phenomenon.

Original Post

From a Bakken reader today: the reader says he/she receives royalty checks from oil companies in the Bakken. She/he asked how long those checks will keep coming.

Q: how long will Bakken royalty checks keep coming?

A:

  • short answer -- 30 years.
  • longer answer -- 70 years.
  • longest answer -- "forever."

1. Whether you, the reader, receives royalties for another 30 years or another 70 years depends on where you have minerals. If you have minerals in one or two drilling units, you will receive royalties for the next 30 years, assuming you are receiving royalties now.

2. If you have minerals in multiple (greater than 20) drilling units spread across the four Bakken counties (Williams, Mountrail, McKenzie, and Dunn), you will be receiving royalties for another 70 years. Probably longer.

3. The reader did not ask about whether royalties would increase or decrease, so I won't answer that question.

4. Now, for that "longest answer." This is a no-brainer. If mineral owners re-invest their royalty checks (a little, some, most, all) into dividend-paying equities, those "royalty checks" will pay you forever.

CLR -- July 29, 2022

Link here.


CLR: press release

  • cash flow from operations: $1.74 billion
  • free cash flow: $1.23 billion
  • quarterly dividend: 28 cents, unchanged
  • net income: $1.21 billion; adjusted, $1.25 billion;
  • EPS: $3.35; adjusted $3.47

All Bakken Wells Coming Off Confidential List Over Next Few Days: CLR -- July 29, 2022

Far Side: link here.

WTI: $98.37.

Natural gas: $$8.320

Active rigs: 46 or thereabouts.

Monday, August 1, 2022: 1for the month, 32 for the quarter, 371 for the year

  • 38701, conf, Summit Carbon Solutions, LLC, Slash Lazy H 5,

Sunday, July 31, 2022: 31 for the month, 31 for the quarter, 370 for the year

  • 38168, conf, CLR, LCU Foster FIU 5-28H1,

Saturday, July 30, 2022: 30 for the month, 30 for the quarter, 369 for the year

  • 37009, conf, CLR, LCU Reckitt Federal 3-22H1,

Friday, July 29, 2022: 29 for the month, 29 for the quarter, 368 for the year

  • 38610, conf, CLR, Bang FIU 14-4HSL,

RBN Energy: do RINs increase the price of gasoline to consumers, part 3?

Refiners and the U.S. Environmental Protection Agency (EPA) have locked horns in a dispute over Renewable Identification Numbers (RINs). Now in its 10th year, the dispute stems from contradictory premises about how RINs affect the profits of the refiners and blenders who produce the ground transportation fuels sold in the U.S. To form an opinion of what ought to happen next, you need to understand the fundamentals of how RINs work in light of the RIN being a tax and a subsidy that forces renewables into fuels. In today’s RBN blog, we focus on how RINs force renewables into fuels and address the related question: Do RINs increase the price consumers pay for gasoline?

They're Reading The Blog -- July 29, 2022

Folks are finally starting to agree: the southern surge is nothing to be afraid of. 

See Peter Zeihan, c. 2022.

North Dakota Wheat -- July 29, 2022

Link here.

I now follow Ms Danielle DiMartino Booth over on twitter.

For a little historical perspective on North Dakota wheat, see this post from November 1, 2010:

Also, note this:

Intel -- July 29, 2022

Missed by a mile.

To what extent is the CEO and or the board of directors complicit in this miss?

Pat Gelsinger is on the hot seat.

From intel.com:

Patrick Gelsinger is chief executive officer of Intel Corporation and serves on its board of directors. On February 15, 2021, Gelsinger returned to Intel, the company where he had spent the first 30 years of his career.