Five (5) New Permits -- The Williston Basin, North Dakota; BR, Halcon Each With One "High IP" Well; 3/3 Bakken Wells Go To "DRL" Status -- July 8, 2014

Wells coming off the confidential list Tuesday:

• 26063, drl, MRO, Swift Eagle USA 31-15TFH, Moccasin Creek, no production data,
• 26856, drl, Hess, EN-State D-154-93-2635H-6, Robinson Lake, no production data,
• 27064, drl, Hess, EN-KMJ Uran-154-93-2734H-8, Robinson Lake, no production data,
• 27211, 51, Legacy Oil, Legacy Et Al Berge 8-11 2H, Red Rock, a Spearfish well, t2/14; cum 4K 5/14

Active rigs:

	7/7/2014	07/07/2013	07/07/2012	07/07/2011	07/07/2010
Active Rigs	189	188	213	166	132

Five (5) new permits --

• Operators: Newfield (3), Whiting, Enduro
  Fields: Sand Creek (McKenzie), Stoneview (Divide), Green River (Stark)
• Comments:

Wells coming off the confidential list over the long weekend were posted earlier; see sidebar at the right.

Six (6) producing wells completed:

• 24372, 2,995, Statoil, Broderson 30-31 2H, Banks, t6/14; cum --
• 25090, 1,352, Statoil, Edna 11-2 5TFH, Camp, t5/14; cum 2K 5/14;
• 25898, 1,846, MRO, Azure USA 31-15H, Moccasin Creek, t5/14; cum 7K 5/14;
• 26118, 2,023, HRC, Grev 157-100-30B-31-2H, Marmon, t5/14; cum 6K 5/14;
• 26961, 1,204, KOG, P Moen 155-99-14-11-2-3H3, East Fork, t5/14; cum 7K 5/14;
• 27017, 993, Whiting, Bartleson 44-1TFH, Sanish, t5/14; cum 4K 5/14;

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Stabilizers To Remove Volatile Gases Before Shipping CBR

From SeekingAlpha

Bakken oil isn't stabilized to make it less volatile, raising risks

• Energy companies invested hundreds of millions of dollars when they started extracting oil from shale formations in south Texas a few years ago to make the volatile crude was safer to handle, but the failure to do so at the Bakken shale is coming back to haunt the oil industry as the U.S. government seeks to prevent fiery accidents of trains containing North Dakota oil.
• Only one stabilizer, which can remove the most volatile gases before transport, has been built in North Dakota and it hasn't begun operation, according to a WSJ review; if the government mandates the use of stabilizers, companies would have to make big investments in equipment which could slow Bakken's development.
• Oil producers are fighting the perception that the biggest risks come from Bakken crude, almost all of which is moved by rail, but safety officials and lawmakers say the dangers extend far beyond North Dakota.

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Improving The Odds: Why Shale Oil Really Is Different

From Rigzone

John Kemp, at Reuters, London, writes:

Critically, the source rock, migration pathway, reservoir rock, and trap, must be found together and in the correct geological sequence. This combination of circumstances is extremely rare. 

But shale is both the source of the petroleum and the trap (because it is so impermeable). Rather than hunting for small pools of oil and gas trapped by faults or rock seals, shale producers can go straight to the source.

CBR Study: Bakken Crude Oil Tends Not To Explode If Trains Stay On The Track

FueFix is reporting:

Oil industry representatives are pushing back against tougher rules for rail cars carrying crude despite a string of fiery accidents and insisting that oil shipped by train from the Northern Plains is no more dangerous than some other cargoes.

An industry-funded report released Tuesday said the volatility of Bakken oil from North Dakota and Montana is comparable to other light crudes.

But the report offers further evidence that Bakken crude is more volatile than heavier oils such as from Canada’s tar sands, following similar studies by Canadian regulators and refiners. The results show Bakken oil is similar to light crudes produced elsewhere in the United States, with characteristics that fall well within the margin of safety for the current tank car fleet, industry representatives said.

Kari Cutting, vice president of the North Dakota Petroleum Council, said it proves federal rules “are sufficient.”

A former senior federal railway safety official disagreed and said recent accidents are enough to justify government intervention.

“We already have examples of this particular crude going ‘boom,’” said Grady Cothen, former deputy associate administrator for safety at the Federal Railroad Administration. “That’s how it has to be treated from a regulatory standpoint despite the distinctions being made” by oil companies.

Oil trains in the U.S. and Canada were involved in at least eight major accidents during the last year, including an explosion in Lac-Megantic, Quebec that killed 47. Other trains carrying Bakken crude have since derailed and caught fire in Alabama, North Dakota, New Brunswick and Virginia.

Regulators in response have discouraged shippers from using older tank cars known to rupture during accidents.

Eight major accidents? Please. Only three involving Bakken crude oil: 1) because the engineer did not set the brakes properly (Canada); 2) washed out railbed due to heavy rains (Virginia); 3) derailment (when crude oil train hit a train that had just derailed). 

I also track these stories at this link.

Fracking, The New Wunderkind

Wunderkind, noun: wunderkind; plural noun: wunderkinds; plural noun: wunderkinder

1. a person who achieves great success when relatively young. 

Fracking is not exactly young, having been around for more than 60 years, I guess, but it has achieved success beyond one's wildest dreams.

There will be a lot of articles written about the supposed risks of fracking and politicians will get a lot of money and support from activists trying to slow/stop fracking, but that will all be on the margins.

It turns out, surprisingly enough, fracking is sort of like a bell curve. Seventy-five percent of fracking is about the current oil and natural gas boom in the US. To the left of the middle of that bell curve are the activists who are trying to shut the boom down.

The question is, what is at the right? It turns out that forces even much more powerful (and surprising) than the activists to the far left are the innovators and entrepreneurs at the far right.

From Scientific American, July, 2013 (it was in the August, 2013, print edition), an overlooked, short, little article, it turns out that the US Department of Energy is looking into using fracking to unleash geothermal energy.

Cool. Ah, yes, the war is won; fill my glass high, the time has come ...

Yellow River, Christie  

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Generally speaking, Bakken crude oil shipped by rail does not erupt into balls of fire if the tank cars don't leave the rails....

Updates

May 20, 2014: again the obvious:

• Bakken crude oil is similar to other North American light, sweet grades and does not pose a greater rail transportation risk than other transportation fuels, according to a report compiled for a North Dakota energy producers lobby group.
• The study shows Bakken crude is more volatile than heavier oils such as from Canada’s tar sands, but is similar to light crudes produced elsewhere in the U.S., with characteristics that fall well within the margin of safety for the current tank car fleet.
• The oil producers' study follows a report with similar results issued last week by a refining industry group.

The reason for increased explosions? Increased derailments. The reason for increased derailments? Increased CBR.

Original Post

Confirming the obvious, and something I've point out from the beginning, SeekingAlpha is reporting:

Oil and refining companies say it's mostly the railroads that are at fault: a probe into the derailment and explosion of a train in Lac-Megantic last year found that brakes weren’t applied correctly; a train that exploded in North Dakota in December crashed into a train that had derailed across the tracks; and the April explosion of a train carrying Bakken crude through Lynchburg, VA, may have been caused because sections of the track bed had been washed away by heavy rains.

By the way, whenever the mainstream media talks about this issue, they use boilerplate "... series of recent accidents..." and then can only come up with three CBR mishaps over the course of several years (since 2009 when CBR first began in the Bakken), and deaths due to CBR in only one case -- when the engineer failed to set the brake. I could be wrong, but I believe CBR is less dangerous than chlorine shipments. Even Ted Kennedy learned that bad things happen when you don't brake at the end of a bridge.

Bakken Crude Is Highly Volatile -- Front Section Of WSJ

Front section of The WSJ: data released by a lobbying group for oil refiners confirmed that crude from the Bakken shale in North Dakota is very volatile and contains high levels of combustible gases.