Zoos Around The Country Helping Out Minot Zoo -- Due To Flooding -- Penguins Already There; Bears Eager to Arrive

Great human interest story.

They came 507 miles by truck, 13 of them packed in small plastic pet crates, a flood-ravaged home behind them and a capital city before them.

The African penguins from Minot, N.D., waddled into their public display at Como Zoo in St. Paul on Thursday morning, just a few of the approximately 230 animals evacuated from the Roosevelt Park Zoo that now is under 4 to 14 feet of water.

They zipped around a 5-foot-deep pool, slid down faux rockwork and loudly hee-hawed like donkeys (hence their colloquial name, jackass penguins) as senior zookeeper Allison Jungheim slipped silvery fish into their gaping beaks.

The penguins, which include the Como-hatched male, Squirt, join three bears and 13 frogs evacuated to Como Zoo. The penguins were the first to go on display; the bears are quarantined and will follow in about a week.

No, Virginia, they are not fattening up the penguins for the polar bears.

Investors Only: Four Energy Stocks To Consider, Including Hess -- Bakken, North Dakota, USA

Four companies mentioned, including Hess.

HES has a P/E of 9.61, a forward P/E of 8.81, and its projected earnings growth for the year is 48.2%. It holds a very conservative accounting rating. HES hit a high 3 weeks ago of $79.03 and has since fallen to $69.19, providing us an opportunity to enter at a value price. 

DOE: SPR Release Oversubscribed -- Counterintuitive -- American Storage Tanks Are Full -- Very, Very Interesting -- Shippers' Windfall? -- NAT?

Link here, from the Oil and Gas Journal:

The Department of Energy described interest in the tender of crude from the US strategic reserve as “very high and oversubscribed,” he said. “We can therefore expect that all of the 30.2 million sweet bbl offered will be taken, and the question now is where do we find the spare storage tank capacity to hold all those barrels?”

Jakob said, “We count five large international oil-trading companies taking floating storage options in tankers (a mix of very large crude carriers and Suezmaxes). Some oil might have to stay on the water while some room is made in the onshore tanks.”

He noted, “A few investment banks had been expressing doubt that there will be any takers for the SPR barrels, but the DOE’s comments of yesterday indicate this was wishful thinking while those institutions rant about market manipulation.

I am surprised. There will be costs associated with storing oil in off-shore tankers.

I assume the asking price for DOE SPR oil closely matches the "crawler" price, or the spot price one can find linked in the Data Page. 

I noted earlier that if oil was taken from the US strategic petroleum reserve, it would be headed overseas. Maybe I was too hasty when I said that I was talking metaphorically since oil is fungible. Maybe it really will be headed overseas. Wouldn't that be something: the US exporting oil to Europe?

For shippers, is this a windfall? Tracking shipping rates and/or share prices of such companies as NAT might be interesting.

Michael Filloon Has a Five-Part Series on Marathon and Eagle Ford, South Texas -- Yes, This Is a Bakken Story

I highly recommend that anyone interested in the "true" value of Bakken acreage should read closely Mike Filloon's five-part series on Marathon and it's recent purchase of South Texas Eagle Ford acreage for more than $20,000/acre.

This is an "ad lib" note that I sent a friend, that could have been overheard at the Econo-Mart in Williston. I haven't put a lot of thought into this (as you can all tell), but it might be an interesting conversation starter.

But this is the conversation starter:

Since I don't follow the Eagle Ford, I had not paid attention to this transaction.

I went back and read the five part series. Very interesting.

In Part 2 of Michael Filloon's very nice five-part series:

Look at the difference in the number of acres / well. Since the Eagle Ford can drill approximately 160 acres in one well, it significantly increases the net resource potential of the field. Don't take this as gospel, its estimates have a well every 833 acres in the Bakken and companies like Brigham (BEXP) are drilling 4 wells per 1280 acres and are talking about increasing to five or six wells. The most important variable with respect to unconventional plays is reliable and repeatable data. We also do not know for sure what wells will be producing in 15 years. These numbers are just an educated guess. As technologies increase, along with proficiency in completion and production, this could increase IP rates and EURs significantly in a matter of years.

Part of the reason Filloon says Eagle Ford is worth $20,000 - $25,000/acre in this area of the Eagle Ford is multiple pay zones, if I understand him correctly.

Multiple pay zones are also true in the Williston Basin (Bakken, TF, Tyler, Spearfish, Madison, Red River, etc.).

"Producing in 15 years."  Most analysts in the Bakken think these wells will produce upwards of 30 years. [I won't be around to find out.]

One has to wonder if $500 to $10,000 / acre in the Bakken turns out to be a very, very good investment when some are willing to pay $20,000 to $25,000 / acre in the Eagle Ford. When you look at the EURs Filloon quotes in the Eagle Ford they aren't a whole lot different than what we are seeing in the Bakken.

Unitization: Great Explanation -- Bakken, North Dakota, USA

For a great description of "unitization," click here and go to "second comment," posted June 30, 2011. [This link is now broken.]

I've also linked it at my "frequently asked questions" page: this appears to be best the answer from most reliable source (this site is down) posted July 1, 2011:

"Basically, under untization, the spacing units disappear and the entire  field boundary lines become a big spacing unit, where all the owners within the field share in production from the entire field, which is allocated to  the owners by an agreed upon formula. The field becomes one big "spacing  unit," because the oil is being artificially forced across would have been the old spacing unit boundaries by the secondary recovery methods  (i.e., waterflood, CO2 etc.).  There will be a hearing or a number of  hearings with the DMR.

The state law requires that 60% of the mineral ownership approve of the  unit, and I believe votes are weighted by amount of acreage owned in the  unit. Most of the larger, older, conventional (i.e., non-Bakken) fields have  been unitized in ND -- Beaver Lodge, Blue Buttes, Fryburg, Big Stick.  The only one I'm aware that was defeated by the mineral owners was in Little  Knife field (Madison pool), and I think most would agree that such action  left a lot of recoverable oil in the ground.

Don't hold me to this, but if you are leased -- and your leases are not currently held by production -- if your leases are included in the unit (and  assuming the unitization plan is approved), they will be considered to be under production, as you will receive royalties pursuant to the formula."

An earlier source said this, which I posted August 2, 2010: Whatever unitization is, it remains a "non-issue" in North Dakota as of 2010. Seriously, here the discussion begins  (this site is down). Unitization is similar to pooling, but it occurs when producer(s) are ready to use enhanced oil recovery to maximize production from a common reservoir. With the Bakken being one huge continuous "reservoir" it's  hard to see how unitization could work, unless they do it by field, an arbitrary designation, in my mind, when it comes to the Bakken. Sixty percent of royalty owners (weighted) must agree to unitization before the NDIC will authorize it. To date, unitization has not occurred in North Dakota (August 2, 2010).

The NDIC hearing docket for August, 2011, will consider unitization of Lost Bridge-Bakken. The state is considering unitizing the Little Missouri State Park, October, 26, 2011.

An effort to unitize the Grail oil field failed. The operator took the case off the NDIC hearing dockets when faced with a fair amount of opposition to unitization.