Great Summary of 2011 in the McKenzie County Farmer -- The Bakken, North Dakota, USA

The McKenzie County Farmer has a great summary of the oil activity in 2011.

I don't know how long the link will remain.

There is simply too much there to summarize; I'll leave it up to the reader to check it out.

Another Great Story -- Just Not Enough Time To Review All These Articles -- Are "We" Over 600,000? -- The Bakken, North Dakota, USA

Link here.

This is a Canadian website.

Lede paragraphs:

Amidst the doom and gloom headlines presaging dire prognostications for the Western economies in 2012 there is the very real promise of a global economy re-directing miracle in the making. The impact and promise of shale gas and shale oil is probably the good news story as we step into 2012. Not that you would know it, given the media’s predilection for bad news.

Only two obstacles stand in the way. First, bad energy policies that do not prioritise cheaper fossil fuels – dumping countless millions out of jobs and into fuel poverty. Second, environmentalist campaigners implacably opposed to any hydrocarbon-fuelled energy development. It threatens their Disney-esque utopian blueprint.

But before we glimpse a rare ray of sunshine amidst the stretching economic gloom, we must first demolish a key widely held myth that is fuelling bad energy policy-making: that oil and gas prices will only go on rising, ultimately rendering their cost comparable to expensive and feeble renewable energy generation. As economist and professor of energy policy Dieter Helm’s recent excellent article pointed out, the UK’s current bias towards expensive renewables is a direct result of energy secretary Chris Huhne’s unwavering faith that the price of fossil fuels can only go on rising.

That’s precisely the mistake an incoming Conservative Government made in 1979. Then oil prices peaked at $39 a barrel (the equivalent of $150 today). In the mid-1980s, however, the bottom dropped out of the oil price ‘barrel’ taking over 25 years to recover. As Helm points out, it is the peak oil and gas brigade – today, a useful ally to the green lobbies – who assume depleting resources based on then known reserves. As Helm says: “Nonsense – and some of it dangerous nonsense."

And then this:

According to EIA figures at the end of 2011, U.S. net imports of oil hit 45 percent from its high of 60 percent in 2005. That’s its lowest level since the mid-1990s. While reduced demand and greater energy efficiency played a part, a significant element is imputed to increased U.S. oil production, especially from shale-oil rich North Dakota. At the end of 2011 oil production in the ND Bakken formation hit a record high of over 600,000 barrels a day. In 2000, the formation was producing less than 100,000 barrels a day. Production here is now set to see the state outstrip California and Alaska early in 2012, making it America’s second largest oil producing state. While much of the United States is suffering economic hardship with employment at around 9 percent, North Dakota’s Bakken region has less than 2 percent joblessness. Further, the region has significant income levels, tax revenue growth, and the housing market is holding its own with the lowest number of foreclosures nationally.

I am not aware of the source for the "600,000" bopd noted above. Maybe I'm getting confused or missing something. But --

The most recent Director's Cut, December 12, 2011:

• Production hits all-time high in North Dakota (again):
  Oct, 2011, oil: 488,066 bopd (preliminary, all time high)
  Sep, 2011, oil: 463,887 

If "we're" over 600,000 bopd at the end of 2011, "we" must be awful close to moving into #2, ahead of Alaska and California. 

Biggest Story of the New Year So Far? Another Chinese Investment in North American Oil -- One Step Closer to No Need for Keystone XL

Updates

September 1, 2012: Is Kuwait buying a piece of the Athabasca?

Original Post

I won't ever be able to find my post, but some time ago I joked that China would someday buy the entire Bakken.

Maybe that joke wasn't too far off base.

But this is a bigger story, a much bigger story, for a different reason, and I haven't seen anyone else talk about it yet. 

Today, from Oil & Gas Journal:

PetroChina snaps up remainder of AOSC's MacKay River project

China’s state-owned PetroChina will be 100% owner of Athabasca Oil Sands Corp.’s MacKay River project at a total price of $2.5 billion (Can.) after paying a further $680 million (Can.) for the remaining 40% of the firm’s shares.

AOSC said it exercised an option to sell its interest in the MacKay River project in Alberta to PetroChina, which in late 2009 bought a 60% stake for $1.9 billion (Can.) (OGJ, Sept. 7, 2009, Newsletter).

Production from the development is slated to start in 2014, with an initial capacity of 35,000 b/d, eventually rising to a top-end output of 150,000 b/d. Canada’s government last month gave its stamp of approval for the start of construction.

PetroChina’s purchase of the MacKay River shares marks the third investment by a Chinese state-owned firm into oil sands projects in Canada, the largest being the $4.65 billion (Can.) paid in 2010 by China Petrochemical Corp. for a 9% stake in Syncrude.

Canada’s regulators do not need to approve the sale nor is it likely they would anyway. Canada’s government and petroleum industry have been frustrated by repeated delays by the US government in approving the Keystone XL pipeline project.

That delay by the US—which is Canada’s only major oil export market—has brought a rethink in Ottawa. Indeed, the Canadians now believe that there best interest lies in diversifying its oil exports to other markets.

Six (6) New Permits -- The Bakken, North Dakota, USA

Daily activity report, January 5, 2012 --

Operators: EOG (2), Hess, BR, OXY USA, Newfield

Fields: Willmen, Bear Den, Clarks Creek, and Little Knife

BR has a wildcat in McKenzie.

Two wells released from "tight hole" status; one was not completed; the other one is interesting considering my recent update on OXY USA:

• 20779, 75, OXY USA, Haroldson 160-91-14-D-1H, Burke County

This is now the 7th of 7 OXY USA wells with an IP less than 80 since entering the Bakken.

Two wells on DRL status were completed, including this one:

• 20809, 1,294, CLR, Pletan 4-18H, Dunn County

Timing Is Everything -- Why I Love To Blog -- The Bakken, North Dakota, USA

In the last 60 days I have posted a number of stories about Enbridge, the pipeline company, entering the crude-by-rail business.

On January 3, 2011, I wrote about Enbridge and crude-by-rail again. 

In that post I wrote this:

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.

Now, today, in spades (as some would say), we see why Enbridge got into the railroad business:

US President Barack Obama signed the pipeline safety reauthorization bill into law on Jan. 3. The law, which was developed in the wake of some significant oil and gas pipeline accidents, will not only help keep communities safer, but also provide operators regulatory certainty to run their systems more effectively, US Transportation Secretary Ray LaHood said following the president’s action.

The law gives the US Pipeline and Hazardous Safety Administration stronger enforcement tools and increases civil penalties for pipeline operators who do not meet safety regulations, LaHood said in a posting at his blog at the US Department of Transportation web site. It doubles the maximum fines that pipeline operators face for safety violations, and requires PHMSA to issue new pipeline safety standards requiring operators to install automatic or remote-controlled shut-off valves and excess flow valves in new or replaced transmission pipelines, he said.

And that explains why Enbridge is spreading its risk.