Tuesday, August 26, 2014

Coming Off The Confidential List Wednesday -- August 26, 2014

ONEOK announces completion of Garden Creek II natural gas processing facility. I track ONEOK activity here: The press release:
ONEOK Partners, L.P., today announced that its 100-million cubic feet per day (MMcf/d) natural gas processing facility in eastern McKenzie County in North Dakota – the Garden Creek II plant – is now operational. The new plant is part of the partnership's previously announced $7.0 billion to $7.5 billion capital-growth program through 2016.

Active rigs:


8/26/201408/26/201308/26/201208/26/201108/26/2010
Active Rigs195185189200138


Wells coming off the confidential list Wednesday:
  • 24601, 131, Samson Resources, Bonneville 3625-7TFH, West Ambrose, t4/14; cum 22K 6/14;
  • 26328, drl, XTO, Boomer Federal 34X-35D, Lost Bridge, no production data,
  • 26882, drl, Abraxas, Ravin 26-35-7H, North Fork, no production data,
  • 27319, 600, Ballard Petroleum, Fines 24-19, Wildcat; t6/14; cum 3K 6/14;
  • 27593, drl, Slawson, Challenger Federal 3-29-32H, no production data,
Fifteen (15) new permits --
  • Operators: Zavanna (8), Oasis (3), MRO, CLR, Cynosure,
    Fields: Stockyard Creek (Williams), Crazy Man Creek (Williams), Baker (McKenzie), Murphy Creek (Dunn)
  • Comments: 4 of Zavanna's 8 permits are for new wells in Stockyard Creek; 4 in Crazy Man Creek; Cynosure Energy has a permit for a wildcat well in Mountrail County; this is Cynosure's first permit in North Dakota; it's too far east to get too excited; Stockyard Creek is a monster of a field; I track Stockyard Creek here;
One (1) producing well completed:
  • 25542, 1,820, Newfield, Anderson State 152-96-16-4H, Westberg, t9/13; cum 71K 6/14;
****************************************
National Anthems

The national anthem for the Islamic State and Central American teen-agers:

Coming To America, Neil Diamond
My, how things have changed. Governor Jerry Brown: "You're all welcome in California." The bullet train will take them to San Francisco.

Transportation Costs For Fracking Sand From Wisconsin -- August 26, 2014

From a reliable source, data points, regarding shipping fracking sand to the midwest from Wisconsin, from one dispatcher:
  • a slow week: 60 semi-loads
  • a busy week: 120 semi-loads
  • delivery cost from mid-Wisconsin to northeast Colorado: $175/ton
  • shipping by truck because NO available trains 
The number of semi-loads is irrelevant to the degree of activity in the Bakken; the number of semi-loads is relevant because it provides a large enough denominator/data base to suggest the price of shipping is not an outlier for this dispatcher.

That is the cost to a central delivery and storage point. Additional costs will be incurred for picking up the sand at the terminal and delivering it to the drilling site.

A typical Bakken well uses 4 million lbs of sand, or 2,000 tons = $350,000 for long-haul transportation.

Companies are trying to get average cost of well down from $8 million to $7.5 million, ball-park figures; they vary dramatically, but that gives newbies an idea of cost of drilling/completing a Bakken well. The range is probably $6 million to $13 million/well. This does not include the less expensive wells near the Canadian border. I have no idea what they cost.

Disclaimer: this is all "idle chatter." I cannot vouch for accuracy but it's what I'm hearing, and what I've read. It could be wrong. In fact, some of it probably is. Mostly because folks will disagree on what a "typical" Bakken well is.

**************************
Global Warming

Coldest August night on record in Ireland.
Breaks record for the entire month of August.
A new record for the coldest August night was set on the night of 23rd/24th August for Northern Ireland.
The Met Office said temperatures plunged to a bone-chilling -1.9C (28.6F) at Katesbridge, Co Down, beating the previous record of -1.1C at Loughermore Forest in 1964.
Note: This wasn’t just the coldest in Katesbridge, it was the coldest on record across all of Northern Ireland.
At some point ... 

But back in the day, when there really was global warming, it was a hot August night.

Brother Love's Traveling Salvation Show, Neil Diamond

This was nowhere near my favorite Neil Diamond song but it connects with that concert. It was always Neil Diamond for me on the radio driving between Blacktail Dam and Williston, back in 1969.

Northeast Of Watford City -- The Bakken -- August 26, 2014

A random photograph and video of one of the sweet spots in the Bakken, northeast of Watford City.

I forget now, but I think this was on "1806" just north of ND State Highway 23.


"Hunter's Run" is just one of many subdivisions going up northeast of Watford City. It was my impression that the amount of construction / activity in Watford City was similar to what we saw in Williston about 3 - 5 years ago.

One of the "sweetest" spots in the Bakken, northeast of Watford City. Turn the volume OFF:

Northeast of Watford City

A reader was nice enough to take the time to explain exactly where this sweet spot is; see first comment:
The area showing in this video is the very deepest part of the Bakken play. The
top of the Bakken is 9000 feet plus below sea level about 5 miles northeast of Watford.
The formations slope upward and outward in all directions from this area.
The Bakken temperature is 300 degrees (F) and pressures are extremely high.
About 10 seconds into the video you are pointing directly at the "center of the Bakken."

The Continental Wahpeton and Oasis Hagen-White multizone/ increased density wells are in the area where you completed your "pan" to the right about 3/4th the way thru the video.
The temperature is important to note. Can you imagine the quality of the steel needed to managed sub-zero temperatures ( - 40 degrees F) at the surface in February, and then maintain integrity two miles below the surface at 300 degrees F?

Video And Graphic Of New Underpass Under The "Original" Williston Bypass -- August 26, 2014

[See first comment. I accidentally deleted it when trying to post it; I was able to "save" it but had to post under/over my name.]

Turn the volume OFF.

Bypass underpass, west side of Williston
 
This is really quite impressive, how fast this is moving. The entry to the underpass, from the east ("old Williston)" is just to the north (or the right) of the Williston High School track and football field (the field is geographically separated from the high school), a continuation of 18th Street, a major thoroughfare for that part of town. According to the map below, it looks like it will connect with Bison Drive, one of the "new" parts of Williston.


Tuesday, August 26, 2014 -- New CBR Terminal Proposed -- Miscellaneous -- For Investors Only

I track CBR terminals here. 

A reader sent me this link, proposing a new CBR terminal:
PLAZA, N.D.-- Dakota Gold Transfer - Plaza, LLC (“Dakota Gold”) announced today that the company plans to develop a crude oil transload facility in Mountrail County, North Dakota. Strategically located on a 350-acre site in the eastern section of the prolific Bakken and Three Forks shale oil producing areas, the Plaza Terminal will provide refiners, marketers and producers with new options for reaching multiple markets across the United States and Canada via rail and pipeline. 
Located on a private rail spur controlled by Dakota Gold under a long-term lease, the state-of-the-art terminal will be served by the Canadian Pacific Railway.
The Plaza Terminal will aggregate crude oil produced in Mountrail and neighboring counties, utilizing gathering pipelines and trucks. The terminal will also provide crude oil storage services through on-site tankage.
The rail facility will have a throughput capacity of 70,000 barrels per day (bpd) and storage capacity of more than 300,000 barrels, with expansion to 600,000 barrels during a planned second phase. The terminal’s design includes two loop tracks with storage for one to two additional trains on the private rail spur, a covered loading barn, a 14-arm system capable of loading a unit train in approximately 14 hours, 15 truck unloading bays and three 103,000-barrel storage tanks.
The Plaza site is large enough to allow for substantial expansions of storage and transload capacity as customer demand increases.
Much more at the link.

When I was out northeast of Watford City over the weekend, I did not realize how close I was to this area. I may have to go back, drive a bit farther east, take a look.

Plaza, ND is about 10 miles east of Parshall, ND -- one of the centers of the activity right now; it's just outside the reservation.  It may be one of the farthest east terminals, and yet it's right at one of the busiest locations. 

****************************
Obama Legacy

The headline: Housing market stuck in downward spiral: Shari Olefson. His words, not mine. The "problem" is that all those illegal children coming across the border are not buying new OR existing homes. If we can change that dynamic somehow, that would help. Perhaps the government could buy homes for Guatemala children between the ages of 10 and 16. Government housing for this relatively small, new group of immigrants couldn't possibly cost more than the government healthcare web site. Okay, bad example.

Back to the linked article:
New homes sales fell by 2.4% from June to July, yet July’s new homes sales were up 12.3% from the previous year.
“New construction appears to be up significantly from last year but when you dig beneath the surface what’s up are multifamily homes,” says Olefson. “Single family homes are up by just 1% which defies logic because we’ve had over 3 million single family units that have been converted to residential rentals.”
Some believe that these numbers mean that housing is approaching normal levels, but Olefson disagrees. She sees more potential buyers turning into renters and believes there’s a lack of suitable housing and loan products for what people can afford now.
Part of the problem is that young couples can't find/won't buy "starter" homes.

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

Burger King to leave the US, over taxes. Warren Buffett, one of the president's BFF's, will finance the merger with the Canadian donut company. It looks like BRK-B may trade at new highs today; if not, awful close.

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or think you may have read here. 

Trading at new highs today: ARII, CP, EEQ, EPD, OKE, PBR, PSX, QEP, RAIL, WLL, WPX.

*****************************
Did He Really Say This?

The Deccan Chronicle is reporting:
White House spokesman Josh Earnest, on Monday, said that Obama has demonstrated his willingness to order military action when necessary to protect American citizens.
"That is true without regard to international boundaries," he said. The White House would not comment on Obama's decision to authorize surveillance flights over Syria.
Oh, well. 

******************************
Ever Since Benghazi And The Bergdahl Swap ....

... it seems US intelligence is struggling. It seems to have started with Benghazi, and now news sources are saying US intelligence agencies have very little "intel" on the Islamic State. It's agreed US intel was either unaware of the Islamic State's preparation for "shock and awe" or no one was listening.

But as Hillary says, "What does it matter?"