Friday, May 4, 2018

"You Bet Your Sweet Bippy" -- May 4, 2018

I'm beginning to think I need to start a new blog to track the Trans Mountain pipeline project. We'll see.

From today's Calgary Herald:
Conservative Leader Andrew Scheer raised a red flag Friday over the potential use of taxpayers’ dollars by the federal and Alberta governments to backstop the expansion of the Trans Mountain pipeline.

With British Columbia’s NDP government trying to kill the $7.4-billion pipeline project, and proponent Kinder Morgan setting a May 31 deadline for the uncertainty around the project to be resolved, one option raised by the Notley and Trudeau governments to move the pipeline forward is public investment.

Possibilities that have been floated range from insurance guarantees to reimburse Kinder Morgan for losses caused by delays, to equity investments, to Alberta’s outright purchase of the pipeline.

Scheer, speaking at a Calgary Chamber of Commerce luncheon at the Westin Hotel, said it’s absurd the situation has devolved to a potential government subsidy for a private company willing to spend its own money as long as it is confident it can proceed.
Spending federal money to subsidize a private company -- isn't that done all the time? Ask Elon Musk about federal incentives for EVs. In fact, taken to its extreme, it's not a lot different than "bailing out" automotive companies which the US did some years ago. Shoot, spending federal money to subsidize wind and solar energy is being done by any number of countries all around the world. What's different about "helping" a pipeline company.

Can it be done?

"You bet your sweet bippy, it can."


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Bailouts

Speaking of bailouts, there are rumors over on Twitter that Jeff Bezos could bail out Elon Musk.

Jeff Bezos has said that the one thing that he will spend his fortune on: going into space. Bailing out Tesla puts Jeff Bezos only two degrees from Space X.

I'm not making any of this up.

I think it's fascinating.

Jeff Bezos' net worth: $130 billion.

How much does Elon Musk need: not more than $5 billion this year.

Pocket change for Jeff.

Random Update Of Wells From 3Q17 That Have Now Been Completed -- May 4, 2018

Updates: updating a few completed wells from 3Q17

Wells:
  • 31637, 1,804, XTO, Lundin 11X-15A, Siverston, t11/17; cum 123K 3/18; the Lundin wells are incredible;
    • 20097 with jump in production, 12/17;
    • 26454 with small jump in production; 10/17;
    • 26455 with small jump in production; 10/17;
Wells:
  • 31136, 1,391, Newfield, Jorgenson Federal 148-96-10-15-11H, Lost Bridge, t6/17; cum 114K 3/18;
    • 17045 with small jump in production; 12/17;
    • 29856 with significant jump; delay in decline
Well:
31638, 2,978, XTO, Lundin 11X-15EXH, Siverston, t11/17; cum 123K 3/18;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN3-201821141651382824396367141740619192
BAKKEN2-2018102460000
BAKKEN1-201823207812093928379462671723328888
BAKKEN12-201729271282776037555501682251527601
BAKKEN11-2017306138260316137741295975323176340
BAKKEN10-20173218000141296

Well:
32909, 441, BR, Lillibridge 3B UTFH, Blue Buttes, t9/17; cum 148K 3/18;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN3-20183131422315011256548111480850
BAKKEN2-20182825370253161045835727357090
BAKKEN1-20183130214301821144642168421450
BAKKEN12-201731251792521610080256762557784
BAKKEN11-2017302970429763116204940249016352
BAKKEN10-201731561253561493579657830
BAKKEN9-2017285825823105410018

Well:
32747, 547, BR, Lassen 5-1-26UTFH, Blue Buttes, t8/17; cum 130K 3/18;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN3-20182626688265652124836405363930
BAKKEN2-20182811895119236697634663420
BAKKEN1-20183123768236971486319736197270
BAKKEN12-20173197439701689616855168480
BAKKEN11-20172645124735255613694136880
BAKKEN10-20173126606264891141736512364970
BAKKEN9-201729239722460579662501524398602
BAKKEN8-20173132712491857281327890
BAKKEN7-20170000000

The wells:
  • 32912, 413,  BR, Lillibridge-Veeder 3E MBH-ULW, Blue Buttes, t8/17; cum -- 
    • 16571, with nice jump 9/17;

Bakken Shale Getting "Back In The Money" -- Bloomberg

Link here. A reader sent me the link. I replied:
Not BECAUSE of this article, but ANTICIPATING an article like this, I posted a one-liner earlier today, a rhetorical question suggesting that the Saudi Surge and the plunge in oil prices was the best thing that ever happened in the Bakken. It weeded out the weak players and it made the strong players stronger, leaner, and meaner. Operators had to adapt to making money at $20 to $40/bbl. Now, even "average" (tier 2) wells are economical.
The best part of the article? The photograph:


From the article:
The cost of getting oil and gas to the surface in North Dakota’s Bakken field has fallen, recently hitting $41 to $50 a barrel for the top-quartile wells in the region. 
Challenges still remain in the region, which is plagued by a lack of gas pipelines to take the fuel to more-promising markets, leading to an increase in flaring, the practice of burning the gas coming out of oil wells.
Technologies like fracking and horizontal wells, reaching lengths never before seen, have led to big reductions in costs across shale basins in the U.S. This has helped most average wells in the Bakken become economical. If West Texas Intermediate oil prices stay above $63 a barrel, all average wells will be “in-the-money."
Some tropes in the article (see first comment below), but (the article is) worth posting. 

Five New Permits; Four Producing Wells Completed -- May 4, 2018

Active rigs:

$69.725/4/201805/04/201705/04/201605/04/201505/04/2014
Active Rigs62502884185

Five new permits:
  • Operators: Oasis (3); Hunt (2)
  • Fields: Bonetrail (Williams); Wolf Bay (Dunn)
  • Comments:
Ten permits renewed:
  • Hess (5): five AN-Gudbranson permits in McKenzie County
  • SHD (3): a Charging Wildcat permit; a War Eagle permit; and, a Luke Neset permit, all in McLean County -- note -- McLean County
Lime Rock Resources (2): two Robert Sadowsky permits in Dunn County

Four producing wells (DUCs) completed:
  • 33311, 1,924, Whiting, Nelson 14-8-2H, East Fork, t4/18; cum --
  • 33544, 285, BR, Outlaw Gap 24-23MBH-A, Sand Creek, t4/18; cum --
  • 33589, 411, BR, Anderson Ranch 2A TFH, Camel Butte, t4/18; cum --
  • 33590, 372, BR, Anderson Ranch 2B MBH, Camel Butte, t4/18; cum --

Anticipating Another 24-Well Array In A 1280-Acre Drilling Unit -- Lillibridge -- Abraxas -- May 4, 2018

Updates

May 6, 2018: see comments and updates at this post regarding exactly what is meant by "... not to exceed 16 wells..." Without doubt, I am 99.999999% sure that this means that the operator is asking to drill another 16 wells in this drilling unit. I have not gotten a definitive answer from a reliable source, but based on three "data points" it is clear to me that the operator is asking for permission to drill up to 16 additional wells on this drilling unit regardless of what is already there when the operator begins drilling (if the operator, in fact, continues to drill). My three "data points" are subject to debate and/or interpretation so I won't get into them now.


May 5, 2018: see comments regarding this issue. Still no definitive answer to question being raised.

Later, 8:35 pm. CDT: after posting the original note, a reader replied, with a comment and a question. The reader raises a question for which I have no answer. It's a very basic question regarding the NDIC hearings/cases but even after blogging all these years, I'm not sure of the answer.

It has been my impression that readers who have skin in the game -- that is, readers who have mineral rights watch their wells very closely and have a better understanding of what is going on in "their" area than I do. For that reason I defer to readers if I have any doubt regarding my understanding of the issue.

With that in mind, I will leave the original post "as is," but post the comment and the question sent to me by a reader.

First the comment:

In the section to the south of section 20, there are four wells, still on confidential list but their names, Lillibridge, and their siting location, suggest that they will be running north into sections 20/17, also. With the eight Lillibridge wells already in sections 20/17, that means there are already 12 horizontals in this standup drilling unit (one assumes that these four wells are also in the 1280-acre drilling unit, but that is not a given). That's pretty much all factual; we will know for sure when these four wells come off the confidential list.

Now the question: does case #26681 below, in the May, 2018, hearing dockets mean there will be a total of sixteen wells in this 17/20 (1280-acre) drilling unit? If so, that means only four more wells might be drilled in this drilling unit.

This is such a basic question, I know there are readers out there who know the answer.

For now, that's where we stand.

Original Post 

From the May, 2018, NDIC hearing dockets:
  • 26681 (case number, not permit number), Abraxas, Pershing-Bakken; 16 wells on an existing 1280-acre unit; McKenzie; section 17/20-150-96;
The map as it stands today. Only section 20-150-96 is shown; section 17 is not show, but all horizontals run north into section 17, and there are no other wells sited or running through section 17. There is an old vertical well in section 17 (#8816) that is now permanently abandoned. I do not know whether Abraxas will put the wells in section 17 (which would be interesting) or in section 20. There are already nine (9) wells in this drilling unit, if one includes the ULW, and now Abraxas wants to add another 16 wells (1280/24 = 50-acre spacing). The map:



  • 6849, 135, Abraxas, Lillibridge 3, Pershing, Madison, t3/79; cum 299K 3/18; this well will celebrate it's 40th birthday next year; 
  • 25609, 1,018, Abraxas, Lillibridge 20-17-8H, Pershing, t12/13; cum 254K 3/18;
  • 25608, 1,048, Abraxas, Lillibridge 20-17-7H, Pershing, t12/13; cum 248K 3/18;
  • 25607, 1,086, Abraxas, Lillibridge 20-17-6H, Pershing, t11/13; cum 228K 3/18;
  • 25606, 1,298, Abraxas, Lillibridge 20-17-5H, Pershing, t11/13; cum 281K 3/18;

  • 23625, 1,275, Abraxas, Lillibridge 20-17-4H, Pershing, t8/13; cum 153K 3/18;
  • 23624, 1,235, Abraxas, Lillibridge 20-17-3H, Pershing, t7/13; cum 276K 3/18;
  • 23623, 1,040, Abraxas, Lillibridge 20-17-2H, Pershing, t7/13; cum 225K 3/18;
  • 23622, 1,225, Abraxas, Lillibridge 20-17-1H, Pershing, t7/13; cum 409K 3/18
  • 29805, 802, BR, Morgan 14-21TFH ULW, Pershing, t11/15; cum 82K 3/18; 
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Docket Search

Doing a search on the blog: Abraxas dockets Pershing resulted in the following hits:

May, 2018
26681, Abraxas, Pershing-Bakken; 16 wells on an existing 1280-acre unit; McKenzie; see this post;

March, 2017
25695, Abraxas, Pershing-Bakken, sixteen wells on an existing 1280-acre unit; McKenzie County

June, 2015
24168, Abraxas, North Fork-Bakken, 15 wells on an existing 1280-acre unit; McKenzie

November, 2014
23265, Abraxas, Dimmick Lake, Fancy Buttes, and/or Pershing-Bakken, establish 2 overlapping 2560-acre units, 2 wells in each; McKenzie
23264, Abraxas, Siverston and/or North Fork-Bakken, establish 2 2560-acre units; 2 wells each; McKenzie

July, 2014
22683, Abraxas, revoke a permit issued to XTO Energy

June, 2013
20512, Abraxas, extend Siverston, Pershing, and/or North Fork-Bakken; establish 6 overlapping 2560-acre units; 1 well each, McKenzie

July, 2012
18369, Abraxas, Pershing-Bakken, complete 8 wells on an existing 1280-acre unit, McKenzie

April, 2011
14694: Abraxas, 7 wells on each 1280-acre unit, 3 units, 21 wells total, North Forks-Bakken, McKenzie