Operations
EOG with a case for 64-wells in a single spacing unit
WPX with a gusher in the Bakken
Slawson exercises right to acquire 50% interest in a Samson Oil & Gas well in Stockyard Creek
Eight fields were CLR is proposing 56 wells in 2560-acre spacing units
Natural gas in North Dakota
Random update on "Sleeping Giant"
CBR
RBN update of Bakken takeway
Flaring
Statoil may have a solution to flaring
Bakken refineries
Random update on the Trenton diesel refinery; operational in 2016
Bakken economy
Update on proposed fertilizer plants in North Dakota (Jamestown, Grand Forks)
Miscellaneous
Price at the pump highest in six years
Saturday, July 5, 2014
"Bakken Well Efficiency Has Topped Out And The Only Offset Is The Exponentially Rising Number Of Wells" -- ZeroHedge.Com
A few days ago (or maybe it was yesterday), Don sent me a link to an Investor Village suggesting that "recent Bakken shale dynamics shows (sic) that well efficiency has topped out and the only offset is the exponentially rising number of wells." If that link breaks, here's the link to the original post at ZeroHedge.
That got the headline but there was much more to the story. The article validates very clearly that the Bakken* literally saved the US economy.
Perhaps I'll come back to that much bigger story some day, but the linked article pretty much says it all.
However, the argument that "well efficiency has topped out in the Bakken" is interesting. For argument's sake, let's agree to agree that the petroleum engineers and drillers have in four or five short years have learned all the secrets there are to learn about the Bakken and drilling to have maxed out well efficiency in western North Dakota. That's pretty impressive: another reminder how incredible US engineers and drillers really are. As recently as 2007, it seemed there were very few folks who believed in the Bakken. Even as recently as 2008 the USGS severely underestimated the potential of the Bakken.
So, agreeing to agree that well efficiency has topped out and all that's left is to drill more wells in the Bakken, where does that lead us? Do operators plan to drill more wells per section in the Bakken? Regular readers recall the most recent NDIC agenda for July in which Continental Resources will be looking to drill 56 wells in one 2560-acre spacing unit. To some, that might simply be "pie in the sky." Where's the meat?
Well, here's the meat. A reader was kind enough to send three screen shots of a recent case in which EOG is planning, very, very specifically, to place 64 wells in one 2560-acre spacing unit. This can get confusing, be careful. I may misunderstand it, but I'm pretty sure this statement is accurate: each well is its own entity, its own birthright, its own parameters. Each well is "assigned" to a specific spacing unit and that does not change. When you see the screen shot and see 64 wells in one 2560-acre spacing unit, note that not all wells are spaced for 2560 acres (at least as I understand it). I have not looked at the existing wells and do not know their spacing (I will do that later, but I am on my way out to spend some time with three granddaughters) but I assume they were drilled before the new 2560-acre spacing was approved. Be that as it may, in the screenshot, note that EOG is looking to have 64 wells in these four sections.
64 / 4 = 16 wells / section
Any mineral owner that owns even one mineral acre in any of those four sections will receive royalties from as many as 56 wells with 2560-acre spacing.
Another big "thank you" to the reader for sending me the screen shots.
*Regular readers know that my reference to the "Bakken" has at least three meanings:
Global Warming Hoax, John Coleman
This was posted on YouTube March 12, 2014
That got the headline but there was much more to the story. The article validates very clearly that the Bakken* literally saved the US economy.
Perhaps I'll come back to that much bigger story some day, but the linked article pretty much says it all.
However, the argument that "well efficiency has topped out in the Bakken" is interesting. For argument's sake, let's agree to agree that the petroleum engineers and drillers have in four or five short years have learned all the secrets there are to learn about the Bakken and drilling to have maxed out well efficiency in western North Dakota. That's pretty impressive: another reminder how incredible US engineers and drillers really are. As recently as 2007, it seemed there were very few folks who believed in the Bakken. Even as recently as 2008 the USGS severely underestimated the potential of the Bakken.
So, agreeing to agree that well efficiency has topped out and all that's left is to drill more wells in the Bakken, where does that lead us? Do operators plan to drill more wells per section in the Bakken? Regular readers recall the most recent NDIC agenda for July in which Continental Resources will be looking to drill 56 wells in one 2560-acre spacing unit. To some, that might simply be "pie in the sky." Where's the meat?
Well, here's the meat. A reader was kind enough to send three screen shots of a recent case in which EOG is planning, very, very specifically, to place 64 wells in one 2560-acre spacing unit. This can get confusing, be careful. I may misunderstand it, but I'm pretty sure this statement is accurate: each well is its own entity, its own birthright, its own parameters. Each well is "assigned" to a specific spacing unit and that does not change. When you see the screen shot and see 64 wells in one 2560-acre spacing unit, note that not all wells are spaced for 2560 acres (at least as I understand it). I have not looked at the existing wells and do not know their spacing (I will do that later, but I am on my way out to spend some time with three granddaughters) but I assume they were drilled before the new 2560-acre spacing was approved. Be that as it may, in the screenshot, note that EOG is looking to have 64 wells in these four sections.
64 / 4 = 16 wells / section
Any mineral owner that owns even one mineral acre in any of those four sections will receive royalties from as many as 56 wells with 2560-acre spacing.
Another big "thank you" to the reader for sending me the screen shots.
*Regular readers know that my reference to the "Bakken" has at least three meanings:
- Bakken one: the small geographical footprint in western North Dakota
- Bakken two: the technology that was developed to unlock tight oil and now used worldwide
- Bakken three: hand-in-glove relationship among residents, regulators, and operators with a can-do attitude to make this work; a relatively unfettered industrial operation
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The Science Is Settled, Shut Up and Color
Friday, July 4, 2014
Happy July 4th, 2014
Not sure what I will post today. I suppose the big story not being reported is this: the Middle East is apparently going on "war footing." I assume that's the English (American) idiom. I say that because there are reports that Israel has announced it will help Jordan protect its borders. Strange bedfellows. All I know is that it took a lot less than this to start WWI. A single assassination was the tipping point then.
So, we'll see.
I think I will just meander along on this post over the day.
4:14 p.m. CDT. Expanding on the above, I see InvestorVillage has noted the same thing and adds this: now, Kuwait is burning, and adds,
4:59 p.m. CDT. GulfNews is reporting:
So, we'll see.
I think I will just meander along on this post over the day.
4:14 p.m. CDT. Expanding on the above, I see InvestorVillage has noted the same thing and adds this: now, Kuwait is burning, and adds,
....we suspect this 'spring' is far from over.Almost a haiku, I suppose... I might work on that later.
Things do not look good...
4:59 p.m. CDT. GulfNews is reporting:
Kuwait’s parliament on Thursday passed a record $82.6 billion budget for 2014/2015 fiscal year, projecting a $11.2 billion shortfall on the basis of a conservative oil price.Something tells me Kuwait will sort this out -- they have a pretty good track record:
The OPEC member has projected a deficit in each of the past 14 fiscal years but ended each year in the black, accumulating more than $300 billion in budget surpluses.
Oil income in 2014/2015 is projected at 18.8 billion dinars, or 94 per cent of total revenue.
Oil revenues were calculated on the basis of a price of $75 a barrel, up $5 from the past year, and a daily output of 2.7 million barrels.
A big "thank you" to Don for sending me this story and others throughout the day. The Saudis have a new expense: the 30,000 troops that have been sent to the Iraqi/Syrian/ISIS border.Like the previous 14 fiscal years, oil revenues are expected to be much higher than the estimates because the actual price is above $100 a barrel and Kuwait’s daily crude production is running at around 3.0 million barrels.
Thursday, July 3, 2014
Seventeen (17) New Permits -- North Dakota, USA; Abraxas With A Nice Well
Active rigs:
Seventeen (17) new permits --
One (1) producing well completed:
| 7/3/2014 | 07/03/2013 | 07/03/2012 | 07/03/2011 | 07/03/2010 | |
|---|---|---|---|---|---|
| Active Rigs | 191 | 190 | 215 | 172 | 133 |
Seventeen (17) new permits --
- Operators: BR (7), CLR (6), Abraxas (4)
- Fields: Sand Creek (McKenzie), Sadler (Divide), North Fork (McKenzie)
- Comments:
One (1) producing well completed:
- 22994, 1,049, Abraxas, Jore Federal 2-11-4H, North Fork, t5/14; cum 8K 5/14;
For Investors Only; Market Highs -- July 3, 2014; Shortened Trading Day
Trading at new 52-week highs: EW, GBX, HES, NOV, SCCO, WFC.
Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here.
Ebola continues to spread in Africa.
Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here.
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Sleeper Story Of 2014?
Ebola continues to spread in Africa.
There have been 759 confirmed or suspected cases of the haemorrhagic fever in Guinea, Liberia and Sierra Leone, the World Health Organisation (WHO) said on Tuesday, with 467 people dead.
"This makes the ongoing Ebola outbreak the largest in terms of the number of cases and deaths as well as geographical spread," the WHO said in a statement announcing a two-day conference in Ghana to be attended by 11 West African health ministers.
"Decisions taken at this meeting will be critical in addressing the current and future outbreaks," it said.
Since West Africa's first ever epidemic of the deadly and highly contagious fever broke out in Guinea in January, the WHO has sent in more than 150 experts to help tackle the regional crisis.
Despite the efforts of the UN agency and other health workers, there has been a "significant increase" in the rate of new cases and deaths in recent weeks, the WHO said.
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