Notes From All Over With Item On ND Flaring -- September 29, 2020

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here. 

Dividend calendar: 119 ticker symbols -- go ex-dividend today. Link here. With commission-free trades, this has been the most fun I've had in years. Taking a small portion of my portfolio and "re-balancing" simply on dividends every month. I'm probably not making any money but it provides a bit of cash for other long-term investments which really interests me. 

Survey of consumer finances (SCF): the rich keep getting richer. Actually, more to the point, the investing class keeps getting richer. Link here to the Board of Governors of the Federal Reserve System.

Entertainment: I've been binge watching Leverage for the past few nights, starting about 11:00 p.m. and going well into the wee hours of the morning. I am just blown away by the iPad. And the  Pencil. The ads are annoying, but one can effortlessly "shrink" the picture into the corner, and then open another video, let's say Schitt's Creek on Pop. Both are free -- Pluto Television and Pop. Or if not interested in another television show, check my mail or any other site. When the add is over, bring Leverage back to full screen. And it's completely effortless, especially using the  Pencil. 

Speaking of the  Pencil, Sophia absolutely loves using the pencil when she is learning Spanish on Duolingo. She can't wait to get to the apartment complex to start using Duolingo. Biggest problem. Temporarily losing the pencil several times a day. Can't wait until Apple release air tags or whatever they're going to be called.

CBR: Alberta to Alaska. It's in the news again; Trump supports it. I won't link it; the story doesn't have legs. Pie in the sky. 

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For The Archives: ND Flaring

From Geoff Simon's top North Dakota energy stories last week:

The North Dakota Industrial Commission approved revisions this week to the state's gas capture policy that don't change gas capture targets, but do tweak the regulations to encourage additional investment to allow the state to meet its gas capture goals.

Producers are currently required to capture 88% of produced natural gas, a target that will increase to 91% as of November 1. Thanks in part to the recent market downturn, producers are now capturing 92% of gas produced in the Bakken.

Lynn Helms, director of the Department of Mineral Resources, noted that producers also exceeded capture targets in the previous oil price downturn five years ago, but couldn't keep pace when growth resumed, so it's important to adjust the rules to make sure producers continue to meet capture targets.

 

Helms said the changes, which include removing exemptions in some areas while tightening restrictions in others, are the byproduct of extensive dialogue with the industry. He said there is general agreement among all parties that revisions are appropriate.

Graphic:

Without Question, The Big Story In February, 2019, Director's Cut -- Flaring -- April 13, 2019

The February, 2019, data is posted here.

Ever since the Bakken boom began, the flaring issue has been most problematic on the reservation.

Some months ago, the state threw in the towel and relaxed the rules.

Prior to relaxing the rules, the percent of produced natural gas captured on the reservation was not too far different from that of the rest of the state.

The state goal is to capture 88% of produced natural gas, a compromise between what the faux environmentalists would like and the oil companies would like. Don't take that out of context. The oil companies have their "goals"; the faux environmentalists have their "goals." The former measures success in dollars and cents; the faux environmentalists measure their success differently, but certainly not in dollars and cents. Do not take that out of context. The regulators have to thread the needle using different parameters when setting standards, goals, regulations. Not an easy task.

We've had this discussion before.

Wow, a digression. All I wanted to say is that the state was approaching success in meeting their goal to capture 88% of produced natural gas. But the reservation is the laggard. Last month, the reservation captured 71% of produced natural gas. I thought that was an all-time (recent) low and couldn't get lower. Boy, was I wrong. In February, 69% capture rate.

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For The Record

Flaring Rules Update: NDIC Has Approved Amendments For Flaring Policy -- November 20, 2018

From The Bismarck Tribune: NDIC to give oil industry more flexibility on flaring. Just in time -- considering the slump in oil prices.

... changed the goals of the gas capture policy first adopted in 2014 to focus on increasing the volume of captured gas rather than reducing the flared volume.

Commissioners also dropped the goals of reducing the number of wells flaring and reducing the duration of flaring. Instead, they added a goal of incentivizing investment. 

the Industrial Commission further expands the number of circumstances that allow a company to be in compliance with the gas capture policy even if the company’s flaring rate exceeds the benchmark.

The gas capture target increases to 88 percent for natural gas produced in November, which will be reported in January.

Director of Mineral Resources Lynn Helms recommended that commissioners postpone the 88 percent gas capture requirement for two years.

However, the commission stopped short of changing the timeline in anticipation of a change to the way flaring is regulated on the Fort Berthold Reservation. The Bureau of Land Management plans to defer regulation of flaring on trust lands to the Mandan, Hidatsa and Arikara Nation starting early next year.

Maybe someone else can provide "specific, actionable" changes. I certainly didn't get much from the NDIC press release or the news story.

NDIC screenshot.

Why I Love To Blog: The Bakken Never Ceases To Amaze Me -- Another Incredible Story -- Read Between The Lines -- October 26, 2018

This is one of those stories that can't help but catch your attention if you've been following the Bakken closely. Spend some time reading between the lines. At The Bismarck Tribune: North Dakota regulators plan review of natural gas flaring rules.

See this post to see natural gas production as percent of total boe (crude oil + natural gas produced in North Dakota). 


Archived.  

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Proposition 112 in Colorado

See this note. All of a sudden, I'm starting to get interested in this story. But as much as I would like to write the "tale of two states" I will control my maniacal tendencies.

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Stories That Fascinate Me Right Now

The top three energy stories that fascinate me right now

• Proposition 112 in Colorado
• Saudi Arabia -- the Crown Prince's recent investment conference was a dud
• News today that the NDIC is raising the flaring issue once again

Flaring issue in the Bakken

• Texas Permian has the same problem -- oilprice.com
• better data at DallasNews 
• fluff piece from Forbes
• mentions 0.5% flaring, Houston Public Media
• the flaring eased and leveled off during the "Saudi Surge"
• perhaps we should stop development in the reservation until flaring there is "under control"
• perhaps we should encourage Saudi Arabia to flood the world with oil 

Wow, look at the increase in natural gas production in the Permian. Incredible.

• EIA pdf, Bakken: https://www.eia.gov/petroleum/drilling/pdf/bakken.pdf. 

• EIA, pdf, Permian: https://www.eia.gov/petroleum/drilling/pdf/permian.pdf.

1% waste in the Permian? I wish state governments and especially the federal government were so efficient with our tax dollars. 1% waste in the Texas Permian .... and the industry is responding ...

Update On North Dakota's Flaring Rules -- Great, Great News For All -- Pragmatic -- Not Going Down The Road-To-New-Zealand -- Not Trying To Save The World -- April 18, 2018

From The Bismarck Tribune:

North Dakota regulators are keeping current benchmarks for reducing wasteful flaring of excess natural gas but are giving industry more flexibility to comply.

The North Dakota Industrial Commission voted unanimously Tuesday to adopt changes to the gas capture policy, many of which were recommended by an industry task force.

“They’re saying they will get to 88 percent by Nov. 1,” said Lynn Helms, director of the Department of Mineral Resources.

The changes expand some of the caveats that allow industry to be in compliance with the gas capture policy even if a company’s flaring rate exceeds the benchmark.

For example, industry can exclude flared volumes from the first 14 days of production. The revised policy increases that to the first 60 days.

In addition, the commission will change how it treats flared gas outside of the Bakken core where infrastructure is underdeveloped and gas is considered “stranded.” Allowing some temporary exemptions for stranded gas aims to incentivize pipeline development in those areas, Helms said.

Bottom line:

• industry can exclude flaring data for 60 days, up from 15 days
• "stranded" wells could be declared temporarily exempt from flaring rules

New Poll: Should Production Have Precedence Over Flaring? -- February 21, 2018

A reader responded to the news yesterday that "the emergency task force" has been activated to address the issue of flaring (again). See this post.

The reader took strong issue with the need for this action, and took particular issue with the Director of the NDIC and the self-imposed flaring caps, suggesting that there seems to be a tug-of-war between someone who wants to slow production (for whatever reason) and the governor who wants North Dakota crude oil production to double (which I have said many times, if "unfettered, the Bakken can produce two million bopd").

My response to the reader:

Thank you. Agree 100% with the sentiment, but some thoughts.

I've flip-flopped on the issue many times. Early on in the boom, I thought the concern of flaring was overdone, but I was wrong -- oil companies, investors, and mineral owners have benefited -- at least as far as I can tell -- with the amount of NG activity we now have in the state.

But, whether it's 87% or 88% it seems like we've turned the corner -- and that's why I agree with your note. There seems to be a lot of hysteria over meeting the 88% goal, when outside of the reservation we seem to easily be there.

The "thing" that has me wondering now: I always thought it was the remote wells (not economical to hook up to a pipeline) and the reservation. If so, I completely agree: ridiculous to hew to self-imposed caps when much of it is due to self-imposed red tape.

But when I look at the graph and the amount of NG production predicted, I think folks are looking out over the next five to ten years. I wonder if Lynn Helms isn't telling Burgum that if we're going to get to 2 million bopd we need to prepare for all that natural gas that will be produced.

My hunch is that the "emergency" task force will come up with some great ideas: maybe it will force some changes in the bureaucracies causing all the red tape; perhaps we will see some incentives for more infrastructure investment; and, if necessary, delay the self-imposed "goals."

So, time for a poll, in which we ask whether production should have precedence over flaring:

• yes, production should take precedence over flaring caps
• middle of the road: ease the caps now but long term keep the caps as goals
• no, hold the industry accountable; enforce the caps 

Note: a "yes" vote does NOT mean one wants to completely scrap policies to minimize flaring. It simply means that production takes precedence and that this "sense of urgency" that something needs to be done "now" is overblown. If that makes sense.

This Stuff Is So Easy To Miss -- Thank Goodness For Twitter -- December 8, 2017

From Argue Media today: the United States under Trump suspends federal flaring restrictions until 2019. Wow. So many story lines, but right now, the data points:

• the rule would have required oil and gas producers on federal land to limit flaring and methane leaks starting a month from now (specifically, January 17, 2018)
• the US BLM said it was delaying compliance -- stating the rule would create a particular burden to marginal wells and threaten their economic viability

This following is true. We saw this phenomenon during the Bakken boom:

US producers sometimes flare natural gas so they can maximize production of more valuable oil, particularly in booming shale areas where gathering pipelines either do not exist or at full capacity.

Producers also sometimes lose natural gas directly into the atmosphere if they lack leak detection programs or install high-emission equipment.

It seems that some states, like North Dakota, have a pretty good handle on this.

The BLM was not only concerned about the economic viability of marginal wells, but like so many Obama-era rules, it was thought by the BLM that this rule would not "stand up to judicial review."

After that, a lot of global warming nonsense, as if one can monetize CO2 emissions affect on global warming. Especially since there is no correlation.

EIA White Paper On Flaring In North Dakota -- November 27, 2015

This was posted by the EIA on November 13, 2015. This brings us up to date. At the link, it is easy to see the "relaxed" rules on flaring.

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AGW in Scientific American

I was surprised to see this in Scientific American.  It's another "scientific journal" that lost its way. The National Geographic, among the US glossies, is perhaps the worse when it comes to global warming hype.

From the linked article:

The climate change debate has been polarized into a simple dichotomy. Either global warming is “real, man-made and dangerous,” as Pres. Barack Obama thinks, or it’s a “hoax,” as Oklahoma Sen. James Inhofe thinks. But there is a third possibility: that it is real, man-made and not dangerous, at least not for a long time.

This “lukewarm” option has been boosted by recent climate research, and if it is right, current policies may do more harm than good. For example, the Food and Agriculture Organization of the United Nations and other bodies agree that the rush to grow biofuels, justified as a decarbonization measure, has raised food prices and contributed to rainforest destruction.

Since 2013 aid agencies such as the U.S. Overseas Private Investment Corporation, the World Bank and the European Investment Bank have restricted funding for building fossil-fuel plants in Asia and Africa; that has slowed progress in bringing electricity to the one billion people who live without it and the four million who die each year from the effects of cooking over wood fires.

My hunch is that the Hollywood elite are not all that worried about the millions of people who still cook over wood fires. 

NDIC Gives Operators An Extra Year To Bring Their DUCs On-Line; Flexibility On Flaring Also Announced -- October 22, 2015

It is "funny" (as in coincidental) how things turn out ... just the other day I mentioned the "one-year-rule" for bringing North Dakota wells on line. And here we are today, it's just announced that North Dakota will extend the deadline by a year. From Seeking Alpha:

• North Dakota regulators approve a plan to give oil producers an extra year to bring a new well online, Reuters reports, in an attempt to give the energy industry breathing room during the oil price downturn.
• Companies will now have up to two years to frack drilled but uncompleted wells under changes approved by the North Dakota Industrial Commission, which means the oil industry will not be forced to spend billions of dollars to frack an estimated 1,000 DUCs, most of which will hit their previous one-year deadlines in December.

Also, in The Dickinson Press link below:

In December through March (2016), about 100 wells per month will reach the one-year deadline.

Under the policy approved Thursday, operators can apply to have those wells put on temporarily abandoned status, giving them another year to store the oil in the ground. Royalty owners, land owners and nonoperating interest owners would have the opportunity to object.

Helms said he expects about 500 wells will be put on temporarily abandoned status, which will prompt a gradual decline in oil production from 1.19 million barrels per day to 1.1 million barrels per day at the end of the biennium in June 2017.

Most experts anticipate that oil prices will recover in 2017, Helms said.

“The state would prefer to tax the oil at a higher price at some point in the not-too-distant future as opposed to taxing it today at low oil prices,” Helms said.

In addition, the NDIC granted some interesting flexibility on the issue of flaring. The Dickinson Press reports:

The North Dakota Industrial Commission adopted new policies Thursday to reward oil companies that exceed their gas capture goals and to allow producers to store oil in the ground until prices recover.

Companies that exceed gas capture goals for 90 days can bank credits for volumes of gas captured and apply them to future months if they fall below the benchmarks.

Helms, who recommended approval of the policy, said credits can only be used if a company encounters extenuating circumstances, such as delays getting right-of-way approval for pipelines or if a gas processing facility is down for maintenance.

The policy aims to motivate companies that are barely making the gas capture target, which is currently 77 percent, to raise the bar so they get credits in the bank, Helms said.

The credits expire after three months and they can’t be transferred to another company.

The policy, which originated as a request from an industry task force, takes effect Nov. 1.

Helms said he anticipates companies to take advantage of the program in the winter, when maintenance issues are more common.

And more:

Last month the Industrial Commission adopted revised gas capture goals that gave the industry an additional 10 months to meet the 85 percent gas capture goal.

In addition, commissioners voted unanimously to grant another six-month exemption from the natural gas flaring policy to XTO Energy for 102 wells, primarily in Dunn County. The commission granted an exemption to those wells in April after a pipeline project failed to move forward. (We've talked about this before.)

The Bear Creek natural gas processing plant under construction by ONEOK will serve those wells and is expected to be complete in fall of 2016.

For me this is the big story: again, operators, royalty owners, surface owners, and the state are working together during a very, very tough time. Good for them; I'm proud of the state.

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COP Gets Permit To Drill Off-Shore Alaska

And then get this, COP wins a permit to drill off-shore Alaska, also at Seeking Alpha:

• ConocoPhillips' plan to build the first-ever oil production facilities at a federal reserve in Alaska is approved by the U.S. Bureau of Land Management, FuelFix reports, allowing COP to construct an 11.8-acre drilling pad and related infrastructure inside the reserve.
• The project offers Alaska the hope of adding new oil to the 800-mile-long Trans-Alaska Pipeline System, which was originally built to ferry 2M bbl/day of crude away from North Slope oil fields; it now carries about a quarter of that amount as nearby production declines, leading to slower flows.
• But with low oil prices, it is unclear when or if COP would proceed with its broader Greater Mooses Tooth project, which ultimately could involve drilling up to 33 wells in the National Petroleum Reserve-Alaska.

In Some Places This Is Called Extortion -- July 1, 2015

It costs about one million dollars ($1 million) to lay one mile of crude oil pipeline in the Bakken.

See story at Bakken.com:

A second operator in the Bakken was granted a flaring exemption today due to a pipeline that Oneok was unable to complete due to right-of-way constraints.

The North Dakota Industrial Commission voted unanimously to “stay consistent” and allow Oxy USA to avoid penalties due to its flared gas on wells affected by Oneok’s cancelled gas pipeline project on the Fort Berthold Indian Reservation. In May, the commission granted a similar request from XTO Energy.

Oneok was forced to halt the proposed pipeline after it was unsuccessful in obtaining an easement from the Three Affiliated Tribes for a 1.8-mile section near Killdeer, despite Oneok’s offer to pay nearly $10 million a mile – 20 times the going rate.

“As opposed to a payment for use of the land,” Helms said, “they wanted a tariff on every mcf of gas that moved through that pipeline during the life of the pipeline, and that was just a no-go with the operators.”

Oneok’s plan B involved rerouting the pipeline across 4.8 miles of federal land but was again denied approval. It is now constructing a new gas plant in Dunn County off the reservation to handle the gas.

Though Oxy asked to avoid flaring penalties on its affected wells in Dunn County until the third quarter of 2016 when Oneok plans to have its gas plant constructed, the commission only granted relief for six months, believing that further construction within the Bakken this summer may provide other means of gas capture for the operator. The exemption only applies to wells that were in production when Oxy became aware of the cancelled pipeline in February.

The bottleneck caused by the failed pipeline project also affects Marathon, Continental Resources, ConocoPhillips (doing business in North Dakota as Burlington Resources) and Newfield Exploration.

The state’s Department of Mineral Resources Director Lynn Helms told the commission he expects to receive flaring exemption applications from these operators as well.

Best Story Of The Day? And Now -- Off The Net For Awhile To Go Biking -- May 14, 2015

From the press release:
LYNNFIELD, MA--

American Power Group Corporation announced that its largest oil field drilling and service company customer who has converted over 50 prime power engines to APG's dual fuel solution is currently operating drilling rigs for four different end customers utilizing APG's Fueled By Flare™ dual fuel solution in the Bakken region of North Dakota.

While the end customers were not disclosed for proprietary reasons, a recent industry survey ranked these four companies among the top 10 oil and gas exploration and production companies in the United States.

Lyle Jensen, CEO of American Power Group, stated, "Over 70% of APG's dual fuel stationary oil rig conversions in North America are operating on conditioned wellhead/flared gas in applications such as drilling, fracking, pumping, air compression and mobile lighting towers.

"The Bakken region of North Dakota is an area facing significant penalties and restrictions associated with the flaring of their wellhead gas. We believe that federal, state, and local emission regulations will only get tougher as it relates to the amount of wellhead/flared gas that can be emitted into the environment. The economic and environmental benefits of converting this previously considered "waste" gas into usable fuel is one of the most compelling environmental case studies of our time and we believe APG's Dual Fuel technology will become a major consumer and sustainability solution for operators in this area."

Mr. Jensen added, "Based on data obtained thus far, our customers estimate a potential aggregate net monthly fuel savings of between $40,000 and $60,000 per drilling rig when utilizing APG's dual fuel solution and conditioned wellhead/flared gas.

As the idling of rigs across the United States appears to be slowing down, drilling service companies as well as their E&P customers are now focusing their efforts on cost reduction and improving operating efficiencies of active drilling rigs which makes our Fueled By Flare™ dual fuel solution the perfect complement to these efforts."

QEP WIth Two Huge Wells -- February 24, 2015; Several Bakken Operators Report Wednesday

Amber Renee off-line again; it turns out I had posted this before but forgot all about it. But not wanting to waste a post on an evening when I'm feeling really, really, ill, I will link it again. I follow the Amber Renee on many posts. 

Dividend news:

• SRE hikes annual dividend 6%, to 70 cents/share ($2.80 annual; reflects a yield of 2.5%)

Reporting Tuesday:

• First Solar (FSLR), forecast 76 cents; huge beat, $1.89/share; shares flat;
• QEP, forecast 25 cents; miss, 22 cents; shares slump; 
• SM Energy (SM): forecast $1.09, misses by 5 cents; $1.05/share; shares hold;
• Windstream (WIN): forecast 3 cents, meets income expectations, but misses on revenue; huge slump; 

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Big story and another example of North Dakota legislature having "its act together." Bakken.com is reporting:

Last Thursday North Dakota senators shot down a measure that aimed to further restrict and reduce flaring activity.
Senate Bill 2287 failed with 35 votes against and 11 in favor. The bill would have cut the amount of time a well is allowed to flare from one year to 90 days.

It also would have placed restrictions on the volume of natural gas flared each day and nullify some exemptions from the current policy.

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CLR's 4Q14 earnings presentation now available as a PDF over at CLR website.

OKE 4Q14 earnings transcript available at SeekingAlpha.

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Active rigs:

	2/24/2015	02/24/2014	02/24/2013	02/24/2012	02/24/2011
Active Rigs	124	189	181	204	168

Six (6) new permits --

• Operators: HRC (3), XTO (2), Crescent Point
• Fields: Four Bears (McKenzie), Tobacco Garden (McKenzie), West Ambrose (Divide)
• Comments:

Wells coming off confidential list today were posted earlier; see sidebar at the right.

Four permits expired: Zavanna Usher in Poe oil field (#24696); and, Slawson's Panther permit in Kittleson Slough (#24704). Two Oasis permits expired: Kuykendall in Foreman Butte (#24188), and Lake Trenton in Eightmile oil field (#24296).

One permit canceled: BR, a Golden Creek well in Dunn County (#17781).

Wells coming off confidential list Wednesday:

• 27038, conf, SHD, Canon 12-36H, Clarks Creek, no production data,
• 27394, A, Fidelity, Barnhart1 20-17H, Heart River, no IP, first production 8/14; cum 61K 1/15;
• 27902, 755, Emerald Oil, Lloyd Christmas 2-4-9H, Heart River, t8/14; cum 15K 12/15;
• 28277, 1,244, Emerald Oil, Lloyd Christmas 4-4-9H, Heart River, t9/14; cum 40K 12/14;
• 28488, conf, QEP, Severin 9-8-16-17LL, four sections,
• 28489, see below, QEP, Severin 1-16-17BH, Grail, a huge well,
• 28490, see below, QEP, Severin 2-16-17BH, Grail, a huge well,

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 27394, see above, Fidelity, Barnhart1 20-17H, Heart River:

Date	Oil Runs	MCF Sold
1-2015	13378	7223
12-2014	14845	8134
11-2014	5215	1537
10-2014	13409	3716
9-2014	11840	2644
8-2014	1983	0

Note production profile --

• 28277, see above, Emerald Oil, Lloyd Christmas 4-4-9H, Heart River:

Date	Oil Runs	MCF Sold
12-2014	7058	2158
11-2014	5004	0
10-2014	14286	0
9-2014	13577	0

28489, see above, QEP, Severin 1-16-17BH, Grail:

Date	Oil Runs	MCF Sold
12-2014	29115	37760
11-2014	20934	2256
10-2014	43680	0
9-2014	15405	0

28490, see above, QEP, Severin 2-16-17BH, Grail:

Date	Oil Runs	MCF Sold
12-2014	31046	27353
11-2014	16989	1443
10-2014	39982	0
9-2014	6246	0

North Dakota State Senator Proposing "Quick Take" Provision (Eminent Domain) To Allow Oil Industry The Needed Pipeilne Easements They Desire -- January 31, 2015

The Dickinson Press is reporting that Senator Sen. Jim Dotzenrod, D-Wyndmere, North Dakota, wants to use "eminent domain" to force surface owners to acquiesce to demands by oil industry for pipeline easements. Specifically the bill would:

• recommend a constitutional amendment creating a “quick take” provision so that if 85 percent of easements have been obtained, the operator may obtain immediate access to the remaining non-consenting landowners’ property

At least that's what I take away from the story, but there's a lot more to it, and I may have misread it. If this is important to you, go to the linked article. 

The provision is part of the a bill addressing the flaring issue in the Bakken. I'm being told that "eminent domain" is a non-starter on the Fort Berthold Indian Reservation (as in "not lawful") and that's where the majority of the flaring problem resides in the North Dakota Bakken.

I like the "quick take" verbiage. That will get someone's attention. LOL. Starting to sound like Chicago politics.

Hess' Approach To Curbing Flaring -- December 17, 2014

Bakken.com is reporting:

A statewide flaring mandate took effect on October 1^st of 2014, which requires companies to capture a certain amount of their natural gas byproduct on-site per month or lower their production amounts. 

The state of North Dakota hopes to reduce its flaring rate by 10 percent in the next three years. Each company is applying different approaches for how they are going to reduce the amount of natural gas they burn off.

Hess, one of the largest producing companies in the Bakken area, is using mobile gas capture technology developed by Gtuit. Gtuit, a mobile natural gas capture service company based out of the Bakken area, is an up-and-coming company in the region and was founded in 2011. The system mounts onto a trailer that attaches to an 18-wheeler and is able to move from well site to well site over the course of less than 24 hours.

According to Oil and Gas Journal, the system can withstand temperatures as low as -40 degrees F and wind chills of -60 degrees F.  The system can adapt to multi-pad sites.

The typical cost for a Gtuit unit and service is somewhere between $45,000-60,000/month.

Following the flaring mandate’s implementation in October Gtuit now processes over 3 million gal of Bakken natural gas liquid.

GE Oil & Gas also offers a mobile-capture unit, CNG in a Box, which was tested by Statoil earlier this year.

I Wonder If Anybody Noticed -- I Doubt It -- December 15, 2014

The AP is reporting:

North Dakota’s oil industry is coming in even lower than the targets set by new rules that require reducing the amount of natural gas burned off as a byproduct of oil production, the state’s top energy regulator said Friday.

Regulators endorsed a policy in July that sets goals to reduce flaring in incremental steps through 2020. The new rules allow regulators to set production limits on oil companies if the targets are not met.

The change requires flaring rates to be reduced to 26 percent by Oct. 1 and 10 percent within six years as infrastructure catches up with oil development.

State Mineral Resources Director Lynn Helms said North Dakota’s natural gas flaring rate was 22 percent for October.

But we know that Alma Clooney wore a really nice hat to her wedding. All is right with the world.

North Dakota Oil Production Likely To Start Falling -- Rigzone, Reuters -- October 1, 2014

For those who have forgotten why the poll regarding future oil production in North Dakota is posted a the sidebar on the right, this long article from Rigzone should help:

North Dakota's oil producers will struggle to comply with aggressive rules taking effect on Wednesday designed to curb the wasteful burning of natural gas, hindered by lengthy federal reviews of crucial pipelines.

The No. 2 U.S. oil state is pushing to resolve a problem commonly known as flaring, an environmental and economic squandering akin to burning cash.

Energy companies have been preparing since June for the deadline requiring them to capture 74 percent of natural gas extracted alongside crude oil from thousands of wells.

The standards get tougher in January.

But the energy industry and state officials say they are bound to fall short of the goal through 2015, flaring gas in excess of targets and consequently having to trim oil production to comply with penalties built into the new standards.

The main reason, according to Reuters interviews and reviews of regulations, is simple: a Byzantine web of state and federal agencies who must sign off on new pipelines. Too few pipelines and a lack of plant capacity to prepare gas for transport means North Dakota flares enough natural gas in one month to heat more than 160,000 homes for a year.

The pipelines are caught between state officials whose top energy policy goal is to cut flaring, and federal agencies, which weigh historical and ecological issues, including protection of habitats for rare plants and animals.

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A Story We Won't See In The Minneapolis StarTribune

The AP is reporting that states are thinking twice about wind farms:

A decade ago, states offered wind-energy developers an open-armed embrace, envisioning a bright future for an industry that would offer cheap electricity, new jobs and steady income for large landowners, especially in rural areas with few other economic prospects.

To ensure the opportunity didn't slip away, lawmakers promised little or no regulation and generous tax breaks.

But now that wind turbines stand tall across many parts of the nation's windy heartland, some leaders in Oklahoma and other states fear their efforts succeeded too well, attracting an industry that gobbles up huge subsidies, draws frequent complaints and uses its powerful lobby to resist any reforms. The tension could have broad implications for the expansion of wind power in other parts of the country.

"What we've got in this state is a time bomb just waiting to go off," said Frank Robson, a real estate developer from Claremore in northeast Oklahoma. "And the fuse is burning, and nobody is paying any attention to it."

Today, many of the same political leaders who initially welcomed the wind industry want to regulate it more tightly, even in red states like Oklahoma, where candidates regularly rail against government interference. The change of heart is happening as wind farms creep closer to more heavily populated areas.

Opposition is also mounting about the loss of scenic views, the noise from spinning blades, the flashing lights that dot the horizon at night and a lack of public notice about where the turbines will be erected.

Much more at the link. 

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A Note To Readers And To The Granddaughters 

A few days ago I posted this note:

I am really, really enjoying Judith Nies' 2014 Unreal City: Las Vegas, Black Mesa, and the Fate of the West. The book provides a superficial, but informative, history of Hopi/Navajo conflicts, the Mormons, coal, water, and the growth of Phoenix, Los Angeles, and Las Vegas in the 1950's. I first mentioned the book a few days ago. It is a short book, and so easy to read, one could read it in one setting, but it is so enjoyable to read, I wish it would not end, and that's why I'm reading it slowly. It reads like a very, very long New Yorker article.

Huge caveat: Bill McKibben endorses this book. I'm only halfway through but I have found the book very informative;  I don't know how the last half will go or how the book will end. So, if you are really, really someone who is wary of Bill McKibben (as I am), don't say I didn't warn you.

On another note, while I was in Chuck Wilder's bookstore in Williston (Books on Broadway) during my most recent visit to the Bakken, I happened to see (and ended up buying) Surfaces and Essences: Analogy as the Fuel and Fire of Thinking by Douglas Hofstadter and Emmanuel Sander, c. 2013.

It's a really, really geeky, nerdy book that seems to be written for PhD types in education, the folks who think about how to teach pre-schoolers, kindergartners, and elementary children how to do better in modern math or Mandarin or advanced physics. It's a great book to read when trying to fall asleep at night. But I slog through it because I'm like the little boy whose bedroom is filled with horse manure but keeps digging, hoping to find a pony. 

I think I've found the pony. I've read a lot of pop literature on physics and at least three biographies of Albert Einstein. But I've never gotten a feel for how he thought, how he made the leaps he made. I am definitely not recommending anyone go out and buy this book. But if this is at all intriguing, see if your local library has a copy, or your local Barnes and Noble and go directly to the middle of chapter 8, p. 451 and start reading "Physics and Logical Thinking." Several pages later, starting on p. 462 the authors talk about Einstein. It could all be apocryphal except for the fact that the authors include quotes from Albert Einstein himself on how he thought about special relativity problems before he sat down and tried to solve the problem(s).

Go to Amazon.com and read the 1-star and 2-star reviews. This pretty much sums up the book:

I agree with the preponderance of reviews here that say this book is too long and rambling by a factor of five, maybe by a factor of ten if you already know some linguistics or psychology. The title might be "Why we are clever authors."

An excellent short section about whether squares are rectangles should be required reading for all teachers of mathematics. A magnificent long chapter on how Einstein used analogical thinking to arrive at his brilliant physical principles is worth the price of the book. It should be required reading for all teachers of physics.

The Bakken Economy Update -- The Williston Wire -- September 26, 2014

Headlines only; it's easy to subscribe to The Williston Wire.


Ground breaking held for new $105 million waste water treatment plant in Williston. The plant is on the north side of the river, at the base of the only bridge across the Missouri River in this area, and the bridge that will be widened to a 4-lane in the next few years.

Tractor Supply opens in Dickinson (previously reported; KMart and Bonanza close.

Three years ago, Carmel Schwab sold 134 homes in the heart of the Bakken - in just one year. After relocating to Williston in 2010 to help run Aberdeen, S.D.-based Centennial Homes' first location in North Dakota oil country, she proved she had the muscle to be a tour de force in the housing market. Schwab said her family and friends thought she was crazy to move to western North Dakota, leaving behind two grown children and a comfortable life in Bismarck."I like crazy busy - that's my personality," she said. 

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The Bismarck Tribune reminds readers new flaring rules go into effect October 1, 2014. 

The first target is to capture 74 percent of the gas by October 1, 2014. This date was chosen because Oneok's Garden Creek II plant was scheduled to be constructed and ready for service at that time. Oneok announced on Aug. 26 that the 100 million cubic feet per day natural gas processing facility became operational; it is just one of the many investments being made by midstream companies to capture the gas and combat flaring in North Dakota. With gas capture goals spread over October through January 2016, the state's Department of Mineral Resources (DMR) Director Lynn Helms said the order is a continuous rollout of "increasing and tightening" flaring restrictions.

The plan to reduce flaring

The NDIC order allows all infill horizontal wells within the Bakken and Three Forks pools to produce at a maximum efficient rate for 90 days.

The first 14 days of flowback gas can be removed from the operator's total monthly volume calculation.

The following 76 days would allow an operator to become connected to a gathering facility or utilize remote capture processes in order to hit the gas capture target. If unsuccessful, the operator can face production restrictions.

The company will only be allowed to produce up to 200 barrels of oil a day if it can capture 60 percent of the gas through remote capture. If it fails to even utilize that technology, the restriction tightens to 100 barrels a day until it implements a solution.

The order delineates between the first wells on a pad and infill wells. The first wells completed in the pool can produce at a maximum efficient rate indefinitely, but those flaring totals will be considered when auditors review overall performance at attempting to capture the gas.

Allowing maximum production on the first well gives operators an opportunity to evaluate the system to determine how many wells it should drill and the necessary infrastructure.

"A lot of 8-inch pipe was laid in the ground over the last few years because we didn't do this and now we found out it was too small," Helms said. "So we don't want to compound that error."

The only exception to the rule on infill wells are those that prove to never be economic to connect to a gas facility, a scenario for just over 1,000 wells in the Williston Basin. Since most produce less than 100 barrels of oil anyway, restrictions wouldn't be necessary.

This blog was one of the first to note this and post this, by the way:

Flaring is significantly higher on the Fort Berthold Indian Reservation as it flared 33 percent of the natural gas produced in June versus an overall state number of 28 percent.

The higher percentage is due to topography and right-of-way delays.

The NDIC would prefer to see a cooperative effort with tribal leaders to enforce gas capture on the reservation, but the Three Affiliated Tribes proposed its own gas capture plan in August which requires operators to pay royalties and taxes on flared gas. The tribe feels the fees provide incentive for operators to capture the gas, but some in the industry question the motive.

I think the bottom line is this: 

• first wells on a pad: maximum production regardless of flaring
• infill wells: 6,000 bbls production/month; 60% must be captured