Whiting's Multi-Well Pad (Permits) in the Sanish -- The Bakken, North Dakota, USA

Locator: 9999B.

In today's daily activity report, NDIC reports permits for a Whiting 3-well pad in the Sanish oil field.

Whiting has provided graphics of how they planned to drill their cash cow, the Sanish oil field, in their corporate presentations over the past year. They have never shown a multi-well pad in those graphics, unless they have shown this in a new corporate presentation that I have not seen.

A multi-well pad in the Sanish is rare, but this is not the first.

Whiting is already putting five to six wells in some sections (1280-acre spacing) but this is a rare multi-well pad for them in the Sanish.

I was surprised to hear today that folks are still unaware that there are areas in the Bakken in which there are more than one or two wells in a section. Whiting has been putting in four to six wells in individual sections (1280-acre spacing) for quite some time now.

The permits for this multi-well pad are:

• 22173, 1,180, Whiting, Carl Kannianen 22-32TFX, section 32-154-91; t9/12; cum 182K 3/17;
• 22174, 3,126, Whiting, Kannianen 22-32XH, section 32-154-91; t9/12; cum 354K 3/17;
• 22175, 1,249, Whiting, Kannianen 22-32TFX, section 32-154-91; t9/12; cum 198K 3/17;

These three will be on one pad; the pad will lie on a northwest to southeast line.

There are already two horizontals in this section:

• 18298,  3,422, Whiting, Kannianen 44-33H, Sanish; t1/10; cum 664K 3/17; 10K/month in May 2012; the well was taken off-line in September, 2011, and did not produce again until 11/11 when it was active for 2 days, producing 960 bbls in November, 2011; when active it produces 15,000 bbls/month
• 19174, 2,090, Whiting, Kannianen 43-33H, Sanish; s7/10; t10/10; cum 365K 3/17; 1,300 bbls in May, 2012; the well was taken off-line in September, 2011, and did not produce until 11/11 when it produced 754 bbls over 9 days; prior to that, it was producing 12,000 bbls/month

************* There is another Whiting 3-well pad in the Sanish, very similar nomenclature:

• 21988, A , Whiting, Tiisto 44-7TFX, section 7-154-91; t5/12; cum 150K 3/17;
• 21989, 2,480, Whiting, Tiisto 44-7XH, section 7-154-91; t5/12; cum 346K 3/17;
• 21990, 688, Whiting, Tiisto 43-7TFX, section 7-154-91; t4/12; cum 133K 3/17;

Ten (10) New Permits -- The Bakken, North Dakota, USA

Daily activity report, first one for the new year, January 3, 2012 --

Operators: Whiting (4), OXY USA (2), Murex, BEXP, True Oil, Oasis

Fields: Manning, Sanish, Dutch Henry Butte, Dimond, Briar Creek, Gros Ventre

Murex has a wildcat in McKenzie; True Oil has a wildcat in McKenzie.

Thirteen (13) wells released from "tight status." Five of those not completed/not fracked.

The eight wells completed, included:

• 19876, 2,879, BEXP, Enderud 9-4 1H, McKenzie
• 20036, 2,331, XTO, FBIR Smith 11X-10, Dunn
• 20059, 1,357, Whiting, Waldock 14-4XH, Mountrail
• 20588, 1,492, BEXP, Mrachek Trust 22-15 1H, McKenzie
• 20629, 929, CLR, Patterson 1-13H, McKenzie

True Oil's wildcat is "in name" only a wildcat; only due to the strict definition of a wildcat is this permit for a wildcat. In fact, the permit is for a location one section away from all the rest of True Oil's huge wells in Red Wing Creek oil field. This permit is also for a location in Red Wing Creek oil field.

The Murex wildcat is on the Montana state line in the far southwest corner of Williams County. This is definitely a wildcat. This one looks like it will be a Bakken with 640-acre spacing.

A Ray Of Common Sense -- California's Low Carbon Standard Unconstitutional

Link here.

Implications for Minnesota and North Dakota.

Enbridge -- Crude-By-Rail -- The Bakken, North Dakota, USA

Update

January 5, 2011: see comments near end of the original. One day after posting the information below, we get the reason why Enbridge entered the crude-by-rail industry.

The US government continues to tighten controls on fossil fuel pipelines.

Original Post 

This story was reported back on December 7, 2011, but was in today's monthly Oil and Gas Journal update.

Enbridge Energy Partners LP will expand its Berthold rail terminal capacity in the Bakken shale by 80,000 b/d and include a rail car loading facility to accommodate the additional volume.

EEP has contractual commitments for 70% of the rail loading capacity and anticipates it will soon finalize agreements for the remaining capacity.

The Berthold Rail Project includes construction of a double-loop unit-train facility, crude oil tankage, and other terminal facilities adjacent to its existing facilities near Berthold, ND. The project will have capacity to stage three unit-trains at Berthold at any given time. After an initial 10,000 b/d Phase I start-up in July 2012, the full 80,000 b/d of rail export capacity will enter service in early 2013.

EEP described the $145 million project as complementing its Bakken Expansion Program, integrating gathering pipeline capacity in western North Dakota and eastern Montana with increased North Dakota export capacity.

EEP expects Bakken Expansion, announced August 2010, to add 145,000 b/d of takeaway capacity from the Bakken and Three Forks formations in Montana, North Dakota, and southeast Saskatchewan, 25,000 b/d of which is already available.

The company expects the remaining 120,000 b/d to enter service by early 2013, a slight delay from initial predictions of late 2012. The Bakken Expansion will cost roughly $370 million for the US projects and $190 million (Can.) for the Canadian projects.

Data points and comments:

• Enbridge positions itself as as a transporter of oil, not a pipeline company (I've talked about that before; the analogy -- the railroads saw themselves as transportation companies, not railroads -- huge difference)
• Enbridge pipelines: Bakken sweet, light oil only
• Enbridge unit trains: flexible product; flexible destination
• The double-loop unit-train configuration looks like the standard in the Bakken; I saw three other such facilities 4Q11; such a configuration can stage three unit-trains at any given time

The crude-by-rail was absolutely essential for Enbridge if it wanted to be as the "go-to" oil transporter in the Williston Basin. I assume a lot of operators were discouraged when Enbridge would not take their sour oil (Madison, Spearfish).

Everyone is aware of the Spearfish activity north of Minot. My hunch is that the Madison will be the next big story once the takeaway capacity is there.

But the biggest reason, Enbridge got into CBR in the short term? If there is an pipeline oil spill, no matter how small, a) the media blows it our of proportion; b) the EPA shuts down ALL the pipelines that might be related; c) pipelines are not re-opened until the government gives its okay; d) the government won't give its okay until the mainstream media accepts the decision (internal political polling); and, e) a pipeline company can come to a complete stop, affecting a financial quarter's bottom line.

Now, if the government shuts down an Enbridge pipeline, it can still meets it contractual arrangements with its customers. This is not rocket science.

Long term: Enbridge realizes that there may simply not be enough pipeline capacity ten years from now.

Chinese Company Buys American Oil Assets -- Again

Link here.

Sinopec, Devon, $2.2 billion.

Devon Energy Corp said on Tuesday China's Sinopec will invest $2.2 billion for a third of the U.S. oil and natural gas producer's interest in five developing fields as part of a long-term partnership.

Foreign companies like Sinopec, hungry for the know-how to produce oil and gas from shale and other unconventional basins, have invested heavily in North American acreage. Chesapeake Energy announced a similar $2.3 billion deal on Tuesday with French oil company Total SA.