Tuesday, October 20, 2015; Update On A Bakken Blow-Out

Updates

October 21, 2015: The Dickinson Press reports the spill at 756,000 gallons. Crude oil is always measured in "bbls" unless it's a spill reported by faux environmentalists, and then it's reported in gallons. 756,000 gallons is 18,000 bbls. Note the first paragraph of the linked article: 

The amount of oil and brine recovered from an oil well near the White Earth River reached 756,000 gallons Tuesday, though officials said 99.9 percent of the contamination was contained to the well pad.

An estimated 18,000 barrels of oil and brine water has been recovered so far, but the total amount spilled is still under investigation, said Department of Mineral Resources spokeswoman Alison Ritter.

Hilarious. Predictable. Ball of dust.

Original Post 

Initially reported late last night, The Grand Forks Herald has an update (this story is also in Rigzone, and thus getting national/international attention): "Significant" oil, brine spill affecting White Earth River in northwest North Dakota:

The well: known as Helling Trust 11-15H, permit #17636.

Bill Suess, spill investigations program manager for the Department of Health, said about 1,760 barrels of oil and 2,000 barrels of brine water had been recovered from the Oasis Petroleum North America well site by 5 p.m. CDT Sunday, but that as of 3:30 p.m. Monday, the company hadn't regained full control of the well.

"It's a significant leak," Suess said, adding, "flow from the well had diminished by a third" since the leak was first reported. Oasis reportedly lost control of the well, about 15 miles south of White Earth and less than 5 river miles north of Lake Sakakawea, about 11 p.m. Saturday.

Oasis said in a statement that there were no injuries. "This one is a little different than the typical blowout," Suess said. "Most blowouts tend to shoot up in the air. So far, we've been lucky on this one. It's been coming out of the wellhead at a slight downward trajectory." [An earlier story said this blowout was due to a neighboring frack.]

He said that helped with recovery efforts, though it remains unclear exactly much oil and brine have spilled. Suess said he expected the well to be shut down by late Monday and spill estimates to be released after that.

The well experienced a tank overflow on Jan. 23, according to a Department of Health spill report. About 130 barrels of oil and 60 barrels of brine were spilled, all of which was recovered.

Active rigs:

	10/20/2015	10/20/2014	10/20/2013	10/20/2012	10/20/2011
Active Rigs	66	191	184	186	195

RBN Energy: continuation of the series on the Williams - Energy Transfer deal.

The acquisition of Williams Companies by Energy Transfer will create a midstream behemoth. The deal is expected to close during the first half of 2016 subject to regulatory approval. Once complete the main holding company Energy Transfer Corp (ETC) will be a C-Corp entity sitting atop Master Limited Partnerships (MLPs – containing the assets of Energy Transfer Partners (ETP), Williams Energy Partners (WPZ), Sunoco LP (SUN) and Sunoco Logistics (SXL). The combined natural gas pipeline network will carry as much as 45% of U.S. Lower 48 dry gas production. Today we take a look at the natural gas infrastructure assets in the deal.

*******************************

Not Ready For Prime Time

Updates

October 27, 2015: Russia burning through cash; could exhaust one rainy day fund as early as next year. 

Original Post

 

In response to a reader talking about $30 oil in the near future, I had this reply:

The problem I see is that Russia can't survive on $30 oil, and now getting into a shooting war, they will spend even more money.

Maybe a year of stability ($30 oil) but once Russia has eradicated those fighting Assad, Putin can look at the bigger picture: Russia/Iran/Syria vs Saudi Arabia.

It might take awhile, but I have trouble believing Putin is in as deep as he is in Syria just because he "likes" Assad. As someone else said, Obama handed Putin the "key to the Mideast" and I think Putin will take advantage of that -- Pan-Shia Persia (90-95% of Iranians are Shi'a and 5-10% are Sunni [Wiki]).

Persia is chomping at the bit to be the Mideast leader once again. Putin is chomping at the bit to be the "Lawrence of Arabia Putin of Persia" and/or Alexander the Great. There's probably already a Hollywood writer fleshing out the movie script.

I had no plans to post that (which I wrote last night) but then this story popped up this morning:

Saudi Arabia's foreign minister on Monday urged Iran to stop "meddling" in the affairs of the kingdom's neighbours, warning that Riyadh stood ready to confront Tehran's actions. 

Iran openly backs President Bashar al-Assad in the Syrian war and is accused of also being behind rebels who overran large parts of Yemen last year and early this year.

Also, this story was linked/posted a few days ago: Saudi Arabia is waging an oil war with Russia, reported in The Chicago Tribune:

President Vladimir Putin tries to restore Russia as a major player in the Middle East, Saudi Arabia is starting to attack on Russia's traditional stomping ground by supplying lower-priced crude oil to Poland.

At a recent investment forum, Igor Sechin, chief executive of Rosneft, Russia's biggest oil company, complained about the Saudis' entry into the Polish market. "They're dumping actively," he said.

Other Russian oil executives are worried, too. "Isn't this move a first step toward a redivision of Western markets?" Nikolai Rubchenkov, an executive at Tatneft, said at an oil roundtable Thursday. "Shouldn't the government's energy strategy contain some measures to safeguard Russia's interests in its existing Western markets?"

European traders and refiners confirm that Saudi Arabia has been offering its oil at significant discounts, making it more attractive than Russian crude. And, even though most eastern European refineries are now technologically dependent on the Russian crude mix, Russia's oilmen are right to be worried.

**********************************

Wage Increases Are The Least Of Wal-Mart's Problems

AFP posts this story: Wal-Mart woes revive minimum wage debate.  I agree that government-mandated minimum wage mandates are bad, bad news, but Wal-Mart has a lot more problems than their recently-announced wage increases.

They need to start with clarifying whether their name is Wal-Mart or Walmart. I do believe the latter is "now" correct.

North Dakota's Active Rigs At Post-Boom Low; 5/5 Bakken DUCs Reported; No (0) New Permits -- October 19, 2015

Active rigs:

	10/19/2015	10/19/2014	10/19/2013	10/19/2012	10/19/2011
Active Rigs	66	190	184	186	198

Wells coming off the confidential list Tuesday:

• 23792, SI/NC, CLR, Monroe 2-2H1, Banks, no production data,
• 28921, SI/NC, Sinclair, Highland 4-9H, Sanish, no production data,
• 31031, SI/NC, EOG, Shell 6-1930H, Parshall, no production data,
• 31032, SI/NC, EOG, Shell 5-1930H, Parshall, no production data,
• 31038, SI/NC, Statoil, Vachal 3-34 7H, Alger, no production data,

Whiting renews a Skunk Creek permit (Dunn County); Petro-Hunt renews a Hoiby permit (Mountrail County).

Two producing wells completed:

• 29232, 2,369, Statoil, Smith Farm 23-14 6TFH, Cow Creek, t9/15; cum --
• 30089, 2,577, BR, CCU Dakotan 5-8-17TFH, Corral Creek, t9/15; cum -- 

*************************

Bakken Economy

Delta suspends flights to Dickinson; lack of passenger demand.

State engineer ends policy on irrigation water for fracking:

In another sign of the oil industry slowing down and infrastructure catching up in North Dakota, the state engineer’s office is discontinuing a program that allows irrigation permit holders to sell water to the oil industry for use in hydraulic fracturing.

The engineer’s office launched the Industrial Water Use in Lieu of Irrigation Policy, or ILOP, in 2011 as an emergency measure to meet the industry demand. The voluntary program allows farmers who held the permits to suspend their irrigation use for a season and use that water for fracking in the oil industry.

Vandalism at root of one spill; a fracking-related blow-out south of White Earth (separate incidents); The Bismarck Tribune is reporting:

First incident: The blowout of a well south of White Earth at 11 p.m. Saturday remains uncontrolled as the State Health Department’s new spill investigation team is on scene.

The department's team manager Bill Suess said Oasis brought in a well control team to stop the flow of oil and salt water. The Oil and Gas Division reports that approximately 8,200 barrels were spilled in the incident, with that number was still in flux as of late Monday.

Second incident: Health Department authorities also are reporting a separate 300-barrel spill in Williams County that was apparently caused when vandals opened two tank seals. Sixty barrels have been recovered so far, and it appears no water drainage has been impacted. An investigation is continuing. The vandalism was discovered Friday about 2 miles northwest of Tioga at a Murex Petroleum well.

Back to the first incident: At the blowout well, fluids are contained within the well pad berm, which is being pumped to prevent overflow, Suess said. An oily sheen from the blowout mist is visible on the White Earth River, and absorbent booms were placed there to prevent downstream contamination, he said. The river empties into Lake Sakakawea, 4 miles to the south.

The incident was caused when Oasis hydraulically fractured another nearby well, apparently causing this one to blow, even though it had been shut in to safeguard against exactly that outcome, according to Oil and Gas Division spokeswoman Alison Ritter. She said oil companies have to provide notice when they'll be fracking within 1,300 feet of an existing well, so operators can take necessary precautions.

Update On The Flatland Federal Fire Last Year -- September 6, 2015

Earlier last year, back in May, 2014, there was a horrific fire, Nabors B08 drilling a Flatland Federal well (#27522). Today I received a nice note from one of the men on the rig at the time. One man was burned but according to the reader has fully recovered. The update and photo of the rig fire is here.

A Blow-Out In The Bakken, Under Control; Contained For The Most Part; Fairly Good Size; No Injuries -- September 1, 2015

I missed this one; a reader alerted me to it. Reuters is reporting:

A North Dakota oil well owned by Exxon Mobil subsidiary XTO Energy blew out on Saturday, leaking more than 550 barrels (23,100 gallons) of crude, some of which left the wellpad and seeped into surrounding grasses.

The well, located in a rural area 25 miles southeast of Watford City, was being hydraulic fractured when its pressure control valves failed and it leaked the oil and about 110 barrels (4,620) of saltwater.

The well was brought under control on Sunday morning. No one was injured.

The well, Deep Creek Federal 43X-5D (#30042), is located on the same drilling pad as four other wells and was first drilled on April 25.

This is on a 5-well pad. Two were older wells, completed some time ago. Two new wells are on the pad, and one of them was one that had the blowout.

A quick look at the other two older wells on the pad: one had a minimal geologist's report; the other has a pretty in-depth report. Background gases jumped up to over 8,000 during various pipe connections. That's fairly high pressure in the Bakken, but not unusual. If there are no equipment failures, it seems operators deal with these pressures without incident ....

... the reader that alerted me to the story had some thoughts/insights on background. There is no question the operator will study this very, very hard and will learn more about the Bakken if it turns out that all equipment and parts (valves, etc) were in good working order and that all procedures were followed. 

The size of the blowout is a fairly significant: 550 bbls. Significant in terms of getting one's attention if one was on-site or in the area to observe it. The typical storage tank on-site in the Bakken is 400 bbls.

Disclaimer: my maps may have mistakes. If this information is important to you, go to the source: Reuters and the NDIC.

All's Well That Ends Well -- Shakespeare's Philosophy On Drilling In The Bakken -- November 29, 2014

Updates

October 8, 2016: it was noted that these three incredible wells were taken off-line in mid-July, 2016, and remained off-line all of August, 2016. 

December 16, 2015: production update here. 

September 6, 2015: a reader sent two photos of the first at Flatland Federal #27522. The reader noted that one individual (a male) suffered burns but recovered fully. The Williston Herald story is here, with one of the two photos sent me.

September 5, 2015: the three Flatland wells have been updated through July, 2015. The Flatland wells have been updated through July, 2015; note that all three wells are still flowing without a pump; also note the the wells have not been on-line the full time; in fact, #27520 was off-line the entire month of July, 2015; in July, for #27520, there was a report that the gas capture unit originally installed was removed; the wellpad is now selling to ONEOK's pipeline. The form said all three Flatland wells were affected.

May 5, 2015: production numbers for these three wells have been updated through February, 2015.

***************************

The tables below are not being updated. The updates are at the links above.

Later, 9:05 p.m. CT: silly me. I didn't think of looking at the scout ticket(s) for the other well(s) on this pad. Here they are:

NDIC File No: 27520  (Whiting considers this the best well in the Williston Basin, May, 2015)
Location: LOT4 4-152-97     Latitude: 48.023199     Longitude: -103.109482
Current Operator: WHITING OIL AND GAS CORPORATION
Current Well Name: FLATLAND FEDERAL 11-4TFH
    Field: TWIN VALLEY

Monthly Sales Data:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	4-2015	30	36976	37084	4012	67961	67354	547
BAKKEN	3-2015	31	46708	46286	4808	181103	180141	900
BAKKEN	2-2015	28	46881	47420	4187	146103	143797	2250
BAKKEN	1-2015	31	52430	52198	4093	141901	128516	13323
BAKKEN	12-2014	31	52103	51904	3664	123971	115165	8744
BAKKEN	11-2014	30	50823	51268	4155	112069	42428	69581
BAKKEN	10-2014	31	61727	60615	12213	117291	11381	105860
BAKKEN	9-2014	27	0	0	0	44	0	0

And here's the third one:

NDIC File Number: 27521 -- t10/14; cum 402K 12/16;
Location: LOT4 4-152-97    Latitude: 48.023199     Longitude: -103.109605
Current Operator: WHITING OIL AND GAS CORPORATION
Current Well Name: FLATLAND FEDERAL 11-4HR
    Field: TWIN VALLEY

Monthly Sales Data:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	4-2015	30	19908	20005	2296	34620	34282	278
BAKKEN	3-2015	31	26998	26811	3157	100230	99670	498
BAKKEN	2-2015	28	31865	32428	3174	92376	90898	1422
BAKKEN	1-2015	31	45023	44921	3898	104257	94408	9787

Original Post

From the well file for a Whiting well still on confidential, but some information had been previously released. From the Geologic Summary:

The Whiting Oil and Gas Corporation Flatland Federal 11-4TFHU is a Twin Valley field well ... the initial phase ... is a coring pilot hole, followed by a vertical and curve, landing in the Three Forks Cycle 2 formation.

The Flatland Fed 11-4TFHU spud February 23, 2014, and reached a total depth of 21,640' MD on May 9, 2014. A month-long delay occurred when Nabors B08 caught fire on the afternoon of March 25. Nabors B15 was moved on locations April 27, 2014, and finished drilling the well.

So, how did things turn out? 

The well is still on confidential; it should come off the confidential list April 7, 2015, but here is the scout ticket (you may want to be sitting down when you look at the first month production):

NDIC File No: 27522, t12/14; cum 395K 12/16
Location: LOT4 4-152-97     Latitude: 48.023199     Longitude: -103.109728
Current Operator: WHITING OIL AND GAS CORPORATION
Current Well Name: FLATLAND FEDERAL 11-4TFHU
    Field: TWIN VALLEY

Monthly Sales Data:

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	4-2015	30	20039	20889	3286	527	467	0
BAKKEN	3-2015	31	26002	25795	3936	105743	105681	0
BAKKEN	2-2015	28	30709	30975	4245	99837	98664	1117
BAKKEN	1-2015	31	36223	35960	3947	88222	70289	17871
BAKKEN	12-2014	31	37293	36740	3799	92836	57816	34958
BAKKEN	11-2014	30	43157	43841	4865	96900	40708	56132
BAKKEN	10-2014	25	45350	44087	17581	108040	11410	96582
BAKKEN	9-2014	27	0	0	0	44	0	0

This should be a full month of production; the scout ticket shows no production in the month of September. Yes, the scout ticket says this well produced 44,111 bbls of oil in the first month of production.

Gas in the upper Three Forks was unremarkable, ranging from 11 units to 724 units. However, in the target zone, in the Three Forks Cycle 2 target zone, gas ranged from 17 to 8,500 units while drilling and in excess of 9,500 units during trips.

Nabors B08 was deemed unfit to continue work and had to be cut apart and removed from location. I am hoping that no one was injured in the fire, but nothing was said. This well is the first of two wells drilled on this pad.

The permit application states this is a Three Forks B1 well on a 2560-acre spacing unit. 

By the way, note the oil field: Twin Valley, where Whiting is setting some records with production. I track the Twin Valley oil field here.

For newbies, 44,111 bbls in the first month is huge, but it's not unprecedented for monthly production; here is what EOG has done as just one of many EOG examples.

By the way, this is what the first few months production of a Whiting record-setting well was in the same oil field, Twin Valley:

• 20589, 4,815, Whiting, Tarpon Federal 21-4H, said to have a 7,000 boepd IP; record middle Bakken (as of Feb, 2012); Twin Valley; s8/11; t10/11; cum 587K 12/16; 30 stages; 2 million lbs sand/mesh (the fourth column is monthly oil production in bbls)

BAKKEN	4-2012	30	17731	17767	1073	43340	33629	9652
BAKKEN	3-2012	31	21492	22221	1237	51368	37957	13349
BAKKEN	2-2012	29	22545	21679	1126	49092	36158	12876
BAKKEN	1-2012	31	27145	27422	1256	51227	9449	41716
BAKKEN	12-2011	31	35016	35708	1639	68022	10077	57883
BAKKEN	11-2011	30	44240	43468	2512	87053	49455	37538
BAKKEN	10-2011	20	26264	25544	13974	53817	0	53779

*********************************

Well, If This Will Keep 'Em Out Of The Malls

Being tweeted now:  'Journey for Justice' marchers pass St. Louis airport on 1st leg of 120-mile trek to state capital; the 7-day march is organized by the NAACP - @huyMach.

They could drive it in an hour and a half, and gasoline is really inexpensive now. I wonder if Al Sharpton will walk, ride, or helicopter?