Northward Ho! -- Great Video of "Ideal" Bakken Rig -- Huge Overview of the Bakken, September, 2012

This story sent to me by a reader. It's an incredible story. It will be linked at the sidebar at the right.
Link here to a drillingcontractor.org article.

There is an incredible video at the very beginning -- the AC Ideal Rig -- a National Oilwell Varco (NOV) rig.  Coming into Williston from the west is the huge NOV complex. I always wondered what they did; now I know.

The video also explains why there are so many cranes in the Bakken and why Borsheim Crane Service has gotten so big in Williston.

BE SURE TO WATCH THE ANIMATION AT THE END of this video. Sons and daughters will want to grow up to be geologists, roughnecks, truck drivers, and LEGO modelers instead of policemen and firemen!

Some data points from the article:

• In 2011, 2,017 new wells were brought online in the Bakken, a number that will be eclipsed this year with the addition of 2,800 wells. “Brand-new wells are seeing initial production rates of 900 bbls/day,” ... 
• Often characterized as a “layer cake” with sometimes complicated geology and long, extended-reach laterals with measured well depths as long as 22,000 ft, the Bakken has served as a proving ground of sorts for rig designs and technology that take into account everything from the geology and well profiles to weather, manpower challenges and lack of infrastructure. 
• The company also has adopted a drilling wells on paper (DWOP) practice that breaks down the drilling operation into a series of processes, with rig crews focused on achieving the maximum technical limit for each stage. The program has resulted in a reduction of up to seven days in drilling time, ...
• But the play is just one of seven petroleum systems, or “pools,” that have been identified in the Williston Basin, suggesting “huge potential in upcoming years, much more than just the Bakken,” said Dr Steve Sonnenberg, professor of petroleum geology at the Colorado School of Mines and chair of the Bakken Research Consortium, a group of 35 companies researching the various aspects of the play. 
• Encompassing much of North Dakota, parts of South Dakota and Montana and extending into Saskatchewan and Manitoba, Canada, the Williston Basin was deposited in the late Devonian and early Mississippian periods. The basin also includes the shallower Tyler play, where the first horizontal test using Bakken drilling technology is planned for Q4 this year; the deeper Mission Canyon and Red River plays; Duperow; Winnipegosis and Winnipeg Group. 
• Operators also have conducted exploratory drilling in the Exshaw formation in northwestern Montana and Alberta, a region formed at the same time as the Williston Basin with very Bakken-like organic shale.

I will leave it at that, but the article is full of information about the Bakken boom. I'll find a place to link it on the sidebar at the right. It's that good.

When I read an article like this, it reminds me that the Bakken boom is not like any previous boom. The companies may be very, very competitive, and very, very secretive, but they are sharing "something" -- the Bakken Research Consortium and well as the UND geology folks (the geology school will soon have a new name, I think) are working behind the scenes to solve common problems. It really is very, very exciting. 

Google It And Follow The Money Trail

Updates

September 30, 2012: It may be more than just the UAE funding environmental groups in the US trying to stop tracking. Now there is a report that Russia might be proving funding for anti-fracking environmental groups in Europe The dots are starting to connect. This is very, very interesting. Link at CNBC. Same story at Yahoo/AP.

Pace's work for Gazprom has raised some eyebrows in Washington, and Hill noted that industry watchers in Europe already believe Russia is bankrolling environmental groups that are loudly opposing plans for fracking in Europe, which could cut down on Russia's natural gas market.

Original Post

This the advice I have given my daughters over the years:

• If you don't know the answer to something, google it.
• If something doesn't make sense to you, follow the money trail.

Those two pearls of advice came back to me today when I posted the following today (literally just a "cut and paste" of something I posted earlier). If it doesn't make sense as posted, go to the links:

From an earlier post, earlier today, September 28, 2011: 

Later, 7:07 pm: this is getting weirder by the moment. Now this story (sent to me by a reader, thank you), regarding the movie about fracking, Dimock, EPA, and starring Matt Damon.

While left-leaning Hollywood often targets supposed environmental evildoers, Promised Landwas also produced “in association with” Image Media Abu Dhabi, a subsidiary of Abu Dhabi Media, according to the preview’s list of credits. A studio spokesperson confirmed that AD Media is financing the film. The company is wholly owned by the government of the UAE. 

Original Post

Fracking, Dimock (Pennsylvania), EPA, Matt Damon, and all that jazz: perhaps the best link of the day, from a reader's comment. Thank you. See update above, dated "later, 7:07 pm." This is getting really, really weird. But at least we're starting to find out who is backing anti-fracking in this country. 

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

Bigger story: I wish I could post some other dots that connect, based on the above, but better part of valor tells me to leave that alone.

Twenty-Two (22) New Permits; Permitting Hits A New Record -- The Williston Basin, North Dakota, USA

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

One producing well was reported as completed:

• 19655, 283, Baytex, Jorgenson Federal 2-15H, West Ambrose, t8/12; cum 6K 7/12

And twenty-two (22) new permits were issued:

• Operators: KOG (6), XTO (6), BEXP (4), Hess (4), Zenergy, Whiting, 
• Fields: Hoot Owl (Golden Valley), Heart Butte (Dunn), Ragged Butte (McKenzie), Rosebud (Williams), Twin Buttes (McKenzie), Robinson Lake (Mountrail)

Comments: 

These are the two wells in the same section where XTO has six new permits:

• 19940, 1,196, XTO,  FBIR Yellowwolf 21X-10, Heart Butte, t1/12; cum 73K 7/12;
• 19948, 2,106, XTO, RBIR Ironwoman 21X-10, Heart Butte, t12/11; cum 65K 7/12;  

These are the two wells one mile east of the section where KOG has six new permits:

• 19925, 609, KOG, Charging Eagle 15-22-15-4H, Twin Buttes, t11/11; cum 94K 712; 
• 21069, 553, KOG, Charging Eagle 15-22-15-3H3, Twin Buttes, t11/11; cum 81K 7/12; 

MDW posted this September 25, 2012: 

Right now, the most interesting metric is the number of new permits each month. A record was set this most recent month (July, 2012) and I suspect we are going to see some more records. According to the Director's Cut, there were 266 new permits in July, 2012 (surpassing the old record of 245 set in 2010). My records show 261 new permits in August but I don't count SWD wells, so maybe a new record in August. For September (only 30 days) we are on track for 253 new permits; it won't be a record but it will beat the 2010 record. 

Update: The state issued 272 permits for oil wells in September, 2012. September was a short month (30 days); the last two days were weekend days, and there were no permits issued on the first three days. So, 272 permits, a record in itself, and in a very short month.

President Orders Chinese Firm To Divest Itself Of Wind Farms in Oregon

First time in 22 years that the president has blocked a legitimate business deal, "they" say. Basis for rejection of the business deal: national security. (It should be noted that Michelle is also on record that obesity is a national security issue which is unrelated but, for some, adds another dimension to the story.)

Citing national security risks, President Barack Obama on Friday blocked a Chinese company from owning four wind farm projects in northern Oregon near a Navy base where the U.S. military flies unmanned drones and electronic-warfare planes on training missions. 

This story has so many story lines, one does not know where to begin.

But this is one of the story lines:

In his decision, Obama ordered Ralls Corp., a company owned by Chinese nationals, to divest its interest in the wind farms it purchased earlier this year near the Naval Weapons Systems Training Facility in Boardman, OR.  Ralls asked for a restraining order and a preliminary injunction to allow construction at the wind farms to continue. 

The firm said it would lose the chance for a $25 million investment tax if the farms were not operable by Dec. 31.

Additional background here.

What little I know about these wind farms is that they are built for tax advantages for larger corporations, and when the tax advantage has run its course, the wind farm is re-sold. Whether or not they eventually turn a profit or not without tax breaks, I do not know.

It will be interesting if anyone steps into buy the Chinese position, especially in light of fact that the tax incentives are not likely to be renewed by the end of the year.

Good, bad, indifferent. It is what it is.

Whiting Bills Itself As The Low-Cost Driller -- Now, a Report From Reuters

Updates

Later, 8:34 pm: a reader noted this -- my bad; I missed it. The linked story is over a year old, published by Reuters back in early 2011. I missed that. I apologize to readers. Interestingly, it seems "we" are talking about the same problems, and the costs of drilling seem to be in the same ball park.

Original Post

Link here to Reuters.

For several months now, at their corporate presentations (and perhaps in the earnings conference calls; I don't recall) Whiting advertises itself as the low-cost driller in the Bakken. And now there's a Reuters story that seems to confirm that.

This a great article, sent to me by a reader (thank you).

Just the other day I posted prices of sand, resin-coated sand, and ceramics (from another source which I cited).

When you read the article, focus on two things: cost of prop pants, and cost of trucking. MDW has blogged that EOG has its own sand mines out-of-state.

MDW also posted a link to a story regarding the continuing shortage of truck drivers.

Some data points from the article:

• costs of wells in the Bakken: due to sand -- KOG
• KOG: $9.5 million/well
• WLL: $6 million/well
• WLL: greater use of sand

In some cases, sand has been so difficult to "get," companies have been forced to switch to larger amounts of ceramics (just out of necessity):

As for the ceramics mix, Abraxas Petroleum Corp  CEO Robert Watson said he aimed to use an average of 40 percent ceramics on Bakken wells. But on a recent well, Abraxas was forced to inject 60 percent ceramics because flooding had prevented a shipment of sand from arriving in the region.

And for investors:

Whiting believes it is the largest customer for Halliburton's white sand in the region, since it has their crews committed to its wells, Whiting CEO James Volker told Reuters on the sidelines of the IPAA conference in San Francisco. At $6 million per well, and $80-per-barrel oil, he told investors that Whiting could expect at least a 3-to-1 return.

The Oil Drum folks might want to read this article.