The Week's Top Energy Stories For North Dakota -- March 18, 2018

From ndenergy.org, the week's top North Dakota energy stories.

Lynn Helms: we need another pipeline

North Dakota oil production is on pace to break the state's previous record, and that means additional crude takeaway capacity will be needed soon.

"Natural gas wise, we're blowing the lid off this thing," he said. "We really are struggling to figure out what to do with all that gas."

Helms said North Dakota producers now have to undercut Canadian suppliers to get their natural gas in a pipeline. But by 2026, there will be so much Bakken gas the pipelines will all be full. Current production is about 2.1 billion cubic feet per day, but Helms expects that total will eventually double.

Bakken investment could hit $700 billion

North Dakota's oil and gas industry has already invested $127 billion in the state, but industry regulators say there's much more to come.

Lynn Helms, Director of the Department of Mineral Resources, predicts that over the life of the play, total investment will approach $600-to-700 billion.

"If this was a football game, we're just coming to the end of the first quarter," Helms said, "so most of the game is still in front of us."

Watford City schools need more teachers

Blogged previously: PSC approves two major projects

CENEX pipeline

The ND Public Service Commission has given the go-ahead to Cenex to upgrade a diesel fuel pipeline between Sidney, Montana and Minot, North Dakota.

The existing 150-mile, eight-inch diameter pipeline will be replaced with a 10-inch line. The upgraded infrastructure will allow Cenex to expand the carrying potential of the pipeline to 60,000 barrels a day from the initial upgraded level of 38,000 bbl/day.  

Arrow Bear Den gas plant

The ND Public Service Commission has approved a construction permit for the Arrow Bear Den Gas Processing Plant II near Watford City. 

The permitting process began in November 2017 to support Crestwood Arrow's gathering system on the Fort Berthold Indian Reservation. A new 25-mile long pipeline will bring product to the plant.

The Phase 2 expansion is expected to cost approximately $195 million and be in service by the third quarter of 2019. 

$6.3 Million Pipeline Being Considered In Watford City Area -- May 11, 2017

Updates

May 20, 2017: this is pretty cool. In the original post at $6.3 million, I suggested the pipeline would be 6 miles long. It turns out the pipeline will be two 2.6-mile pipelines (2 x 2.6 = 5.2 miles) -- I wasn't too far off. LOL. Much more at the link:

• Arrow Field Serices, a Crestwood subsidiary
• formal name of this short dual pipeline/NG processing plant: Bear Den West gathering pipeline and processing plant
• 7 miles southeast of Watford City
• both pipelines will be in the same ditch
• one pipeline will carry up to 30 million cubic feet of natural gas/day
  the other pipeline will carry up to 5,000 bbls of other products
• timeline: start in May; finish in August
• the gas processing plant is too small to be regulated by the PSC; comes under jurisdiction of NDIC
• Lynn Helms says without the pipeline, takeaway capacity is constrained; could result in more flaring

Original Post 

PennEnergy, data points:

• proposed $6.3 million pipeline project
• Arrow Field Services (that name sounds familiar)
• proposed: two natural gas transmission lines from a proposed processing plant in McKenzie County
• the pipelines would be southeast of Watford City
• no more specifics given
• at a million dollars/mile, we're talking about a 6-mile pipeline

Whoopee!

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A Note For The Granddaughters

Wow, I'm in a great mood.  I grade every day on a scale of 1 - 10, mostly based on weather and biking. A "10" is a perfect day, of course, and rarely, I give a day an 11 or a 12. Tonight might be a 12.

I take off points for a) temperature (either too hot or too cold); b) precipitation/humidity; and, c) wind.

This evening the temperature is perfect; it must be about 76 degrees outside right now. I just checked: it's officially 83 degrees "but feels like 79 degrees." No wind. Sun setting. Nice billowy / puffy clouds to the south. We can see lightning off in the distance. A huge thunderstorm / hailstorm is predicted overnight. Our area should not see the worst.

It's a great night to be on the patio. We have a patio outside our little apartment which I occasionally enjoy. But we are not allowed to barbecue out there, and it's a bit small to be really enjoyed. Whatever.

The evening is a 10. Really an 11 or a 12.

Minor Notes, Cleaning Out My In-Box -- May 2, 2017

A reader sent me this link; the Bakken was mentioned: Crestwood Announces First Quarter 2017 Financial and Operating Results; New Bakken Expansion Projects to Support Record Arrow Volumes; Delaware Permian Nautilus Gathering System On-Track for Early In-Service Date.

When I got the note, I responded to the reader:

That's pretty cool. I actually have a tag at the blog for the Arrow Pipeline system. I've tagged it in about five posts, could have missed some posts; earliest as back in 2011:

http://themilliondollarway.blogspot.com/2011/01/first-for-kog-3-wells-on-one-pad-five-5.html

That was back in 2011.

And this was back in 1974, for me:

The Most Beautiful Girl In The World, Charlie Rich

Arrow Pipeline -- The Williston Basin, The Bakken, North Dakota

It's been a long time since I checked in on the Arrow Pipeline and the Arrow Pipeline map, one of the earlier pipelines in the Bakken that got caught my interest.

One can see a map at this "quick html link."

When you get to the link, click on "download original" in the upper right hand corner to get the very, very nice PDF file of same. It's worth the visit.

Map of the Arrow Pipeline -- The Bakken, North Dakota, USA

Map of the Arrow Pipeline.

Mega-Pads in the Bakken: QEP and WPX in Heart Butte and Deep Water Creek Bay

Mike Filloon mentioned that QEP has finished drilling all the wells on its 10-well pad. There are two fields in which QEP has a number of multi-well pads: Heart Butte and Deep Water Creek Bay.

Heart Butte is an interesting field, a very active field, and one with much history -- for a boom that's in its early stages. The oil field first caught my eye back in March, 2010, when I was transcribing the NDIC hearing dockets for that month:

• 12284: Questar, extending the Heart Butte Field and creating 24 640-acre spacing units in Dunn, McLean and Mountrail Counties, with two horizontal wells in each (48 wells)

This was before Questar split of QEP.

The Heart Butte oil field was also the focus for the Arrow Pipeline, a huge deal at the time for many reasons.

So, now we wait for the IPs for the ten wells that QEP has just completed.

Here are some multi-well QEP pads and WPX pads in Heart Butte and Deep Water Creek Bay:
Two 5-well pads, section 3-149-92:

23331, 2,282, QEP, MHA 1-03-34H-150-92, Heart Butte, 4 sec, t3/13; cum 42K 5/13;
23332, 2,348, QEP, MHA 3-03-34H-150-92, Heart Butte, 2 sec, t3/13; cum 48K 5/13;
23333, 2,310, QEP, MHA 1-03-35H-150-92, Heart Butte, 4 sec, t3/13; cum 40K 5/13;
23334, 1,949, QEP, MHA 3-03-35H-150-92, Heart Butte, 4 sec, t3/13; cum 35K 5/13;
23335, 1,791, QEP, MHA 2-03-35H-150-92, Heart Butte, 4 sec, t3/13; cum 27K 5/13;
23336, conf, QEP, Heart Butte,
23337, conf, QEP, Heart Butte,
23338, conf, QEP, Heart Butte,
23339, conf, QEP, Heart Butte,
23340, conf, QEP, Heart Butte,

Two 5-well pads:

• 23093, conf, QEP, Heart Butte, 
• 23094, conf, QEP, Heart Butte, 
• 23095, conf, QEP, Heart Butte, 
• 23096, conf, QEP, Heart Butte, 
• 23097, conf, QEP, Heart Butte, 
• 23098, 1,632, QEP, MHA 4-06-32H-150-92, Heart Butte, t2/13; cum 24K 5/13;
• 23099, 1,994, QEP, MHA 2-06-32H-150-92, Heart Butte, t2/13; cum 33K 5/13;
• 23100, 1,922, QEP, MHA 3-06-32H-150-92, Heart Butte, t2/13; cum 52K 5/13;
• 23101, 1,777, QEP, MHA 1-06-32H-150-92, Heart Butte, t2/13; cum 107K 5/13;
• 23102, 1,966, QEP, MHA 4-06-31H-150-92, Heart Butte, t2/13; cum 51K 5/13;

Two 5-well pads, 31-150-91
(I don't know if this is the 10-well pad Filloon is referring to), Heart Butte:

• 21551, 2,757, QEP, MHA 3-31-25H-150-92, 4 sec, t10/12; cum 89K 5/13;
• 21552, 2,351, QEP, MHA 2-31-25H-150-92, 4 sec, t10/12; cum 74K 5/13;
• 21553, 2,202, QEP, MHA 4-31-25H-150-92, 4 sec, t10/12; cum 85K 5/13;
• 21554, 2,430, QEP, MHA 1-31-30H-150-91, 4 sec, t10/12; cum 78K 5/13;
• 21556, 2,376, QEP, MHA 3-31-30H-150-91, 4 sec, t10/12; cum 70K 5/13;
• 21557, 2,140, QEP, MHA 1-31-36H-15-92, 4 sec, t5/13; cum 14K 5/13;
• 21558, 2,359, QEP, MHA 3-31-36H-150-92, 4 sec, t5/13; cum 18K 5/13;
• 21559, 2,032, QEP, MHA 5-31-25H-150-92, 4 sec, t5/13; cum 12K 5/13;
• 21560, 673 QEP, MHA 7-31-25H-150-92, 4 sec, t5/13; cum 19K 5/13;
• 21561, 1,731, QEP, MHA 1-31-25H-150-92, 4 sec, t5/13; cum 9K 5/13;

32-150-91, Heart Butte; one 4-well pad and one 2-well pad

• 20487, 606, QEP, t11/11; cum 160K 5/13;
• 20488, 1,571, QEP, t11/11; cum 182K 5/13;
• 20489, 933, QEP, t11/11; cum 141K 5/13;
• 20490, 2,609, QEP, t11/11; cum 243K 5/13;


• 22028, 2,737, QEP,  MHA 2-32-29H-150-91, t11/12; cum 91K 5/13;
• 22029, 1,961, QEP, MHA 4-32-29H-150-91, t11/12; cum 84K 5/13;

A 3-well pad, and two 4-well pads in 31-148-92, Heart Butte:

• 22649, 709, WPX, Charles Blackhawk 31-30HA, t11/12; cum 63K 5/13;
• 22650, 247, WPX, Charles Blackhawk 31-30HX, t11/12; cum 50K 5/13;
• 22651, 219, WPX, Charles Blackhawk 31-30HB, t11/12; cum 62K 5/13;

• 22652, conf, WPX, Charles Balckhawk 31-30HY, 
• 22653, conf, WPX, Charles Blackhawk 31-30HC, 
• 22654, conf, WPX, Charles Blackhawk 31-30HZ,
• 22655, conf, WPX, Charles Blackhawk 31-30HD,

• 21904, 1,542, QEP, MHA 4-06-07H-147-92, Heart Butte, t8/20/12; cum 101K 5/13;
• 21905, 2,223, QEP, MHA 2-06-07H-147-92, Heart Butte, t8/17/12; cum 81K 5/13;
• 21906, 2,142, QEP, MHA 4-32-33H-148-92, Heart Butte, t8/15/12; cum 75K 5/13;
• 21908, 2,180, QEP, MHA 2-32-33H-148-92, Heart Butte, t8/22/12; cum 83K 5/13;

5-149-90, Deep Water Creek Bay

• 21091, 499, QEP, t7/12; cum 54K 5/13; 
• 21092, 436, QEP, t7/12; cum 51K 5/13; 
• 21093, 878, QEP, t7/12; cum 72K 5/13; 
• 21116, 952, QEP, t4/12; ccum 70K 5/13; 
• 21824, 814, QEP, t4/12; cum 53K 5/13; 

18-150-90, Deep Water Creek Bay

• 17434, 880, QEP, t1/09; cum 145K 5/13;
• 17940, 1,217, QEP, t1/10; cum 211K 5/13;
• 18930, PNC, QEP
• 18991, 1,053, QEP, t9/10; cum 148K 5/13;
• 19683, 766, QEP,  t12/11; cum 115K 5/13;
• 20271, 592, QEP, t12/11; cum 102K 5/13; 

Some time ago I mentioned that I was no longer tagging/labeling "multi-well pads" because this was becoming too commonplace. I am now tagging/labeling "mega-pads"which have more than 5 wells on the pad. This is different than the tag "mega-units" which generally refers to 2560-acre spacing units, but at least 1,920 acres.

Note: there may be some errors on the data above; it was done quickly and not double-checked.

Update on KOG Update -- Bakken, North Dakota, USA

Because I was traveling when the most recent KOG update was released, I was not able to post everything I wanted to post.

Folks invested in KOG will have already seen it and looked at it closely but newbies should take another look at it, and pay attention to some key phrases:

• KOG will add a third rig this quarter (1Q11)
• KOG is partnering with XOM on some wells (read "deep pockets" for XOM)
• December weather will impact production targets (buying opportunity when earnings reported)

• KOG mentions that production from a four-well pad will be connected to a recently completed pipeline system. That system was not named, but I'm thinking Arrow Pipeline
• KOG believes that their recent drilling results suggest the Bakken and Three Forks are not communicating with each other in KOG's core operating area in Dunn County
• KOG believes that recent drilling results lend support to "drilling at least four Bakken wells within a drilling unit." That's a verbatim quote. Note some key words: "at least four"  .... "at least" ... "Bakken wells" ....  they did not say Bakken and Three Forks wells. 

In addition to these four-wells pads, KOG is also drilling two-well pads.

KOG Releases Operations Update

Talk about an exciting report.

More to follow but here are three bullets that caught my attention:

• KOG will add a third rig this quarter
• IPs are very impressive
• KOG says they've partnered with XOM

Just yesterday I posted dots connecting Arrow Pipeline, KOG, XOM (buying XTO), and Mandaree oil field. This link will provide additional background.

As noted earlier, cash flow and/or access to credit facilities are key in the Bakken for wells costing $5-8 million. Having XOM as a partner allows a company to expedite their drilling program.

For newbies, note: Bakken companies will miss their production targets in December due to weather. KOG mentions their wells were shut in part of December due to snow and blizzard conditions. For those who understand this, it could result in a buying opportunity for those who invest in the Bakken.

Other details from the report:

• FBIR 34X-25 spudded; XOM is the joint venture partner; KOG holds 50% working interest
• Producing 2,700 boe/d (in line with previous announcements)
• Expect to end December with 2,100 boe/d (decrease due to winter conditions)

Dunn County: 35,000 net acres

• Completed two of four wells on its initial four-wells pad
• Partially completed a third well on same pad that targeted the Three Forks formation
• Due to weather, completion work on remaining wells delayed until 1Q11
• All wells on this four-well pad will be connected to recently completed third-party operated pipeline 

Longer-lateral Bakken producer records IP of 2,030

• Two Shields Butte 14-21-33-15H, long lateral, 23 stages, completed in December, 2010; IP based on 32/64" choke (my understanding is that 64/64" is wide open; 32/64" is half-open -- I do not know if this is accurate -- saw that on a message board)
• This well was drilled 1,350 feet from existing producing Bakken well completed in 2009
• During drilling, some pressure communication was observed, but both wells now appear to be producing independently
• History is limited, but KOG believes results lend support to drilling at least four Bakken wells within a drilling unit -- note this was a long lateral, thus a drilling unit of 1280 acres

Longer-lateral Bakken producer records IP of 1,042

• TSB 14-21-33-16H3, long lateral, Three Forks formation, completed only 6 of 22 planned stages
• The remaining 16 stages will be completed in 1Q11, along with a fourth well from the pad
• Drilled 700 feet from TSB 14-21-33-15H
• Completion history of these two wells (one Bakken, one TFS) demonstrates production potential of TF formation in KOG's core operating area

Shorter-lateral Bakken producer records IP of 1,196 

• TSB 14-21-4H, short lateral, 11 stages (completed)

Drilling Activity: another 4-well pad

• Reached TD on first well, TSB 2-24-12-2H, a long lateral
• Now drilling second well on same pad, the Skunk Creek 2-24-25-15H, a long lateral
• The final two wells (TSB 2-24-12-1H3 and SC 2-24-25-16H3), both long laterals, should be completed 2Q11

McKenzie County: 26, 000 net acres

• Drilling operations completed on two-well pad
• Koala 9-5-6-5H, Bakken
• Koala 9-5-6-12H3, Three Forks
• Completion work yet to be completed, 1Q11

Drilling activity commenced on second two-well pad in same area

• Koala 3-2-11-14H is currently drilling ahead and will be followed by 
• Koala 3-2-11-13H
• Grizzly 13-6H, a short lateral is scheduled for completion in 1Q11

A First for KOG? 3 Wells on One Pad? -- Five (5) New Permits in North Dakota (USA) Today

Producers: KOG (3), EOG (2), and CLR.

Fields: Van Hook, Mandaree, and Little Knife.

The Little Knife field has been relatively exciting.

Of course, the Van Hook and the Mandaree, both inside the reservation, are very exciting fields.

EOG will put two wells on one pad in Van Hook.

KOG will put three wells on one pad in Mandaree. Is this the first such multi-well pad for KOG? I don't know. I assume it will be the first of many based on the dockets during the past year.

For those interested, folks might want to search "Arrow Pipeline" in the reservation and the location of these new KOG permits. I will spend some time on this when I get back home and have more time to look at the maps, etc. Some months ago I posted a note about connecting the dots regarding the Mandaree field, the Arrow Pipeline, XOM's acquisition of XTO, etc.

Today's daily active report also reported several good wells, some of which I have posted elsewhere; the rest I hope to post tomorrow when I have more time.