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KOG continues to be a Wall Street darling. Most of the data points in this article could be applied to most operators in the Bakken:

• a twelve-year drilling inventory
• 2013 production significantly higher than 2012 production
• it trades below its peers on a multiples basis

My favorite contributors with regard to the Bakken over at SeekingAlpha: Filloon, Zeits, Fitzsimmons.

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And then there are those who like EOG.

On Monday, March 31, EOG Resources announced that five new wells in the Eagle Ford formation were pumping more than 13K boe/day of crude and yielding 91%-97% oil. According to sources, these wells had individually produced between 2,314 and 3,071 boe/day and the crude that was discovered is very similar to the light oil that is produced off the coast of Louisiana.

If EOG Resources can continue to demonstrate significant production-related performance as it continues to develop newer wells, there's a very good chance the company's long-term earnings growth and long-term revenue growth could increase if such performance is sustained. In other words, if EOG can continue to develop wells that yield at least 92% oil while producing an average of 2,500 boe/day, there's a very good chance both earnings and revenue growth could be positively impacted for years to come.

That's a pretty tepid analysis.  Let's repeat that analysis: "In other words, if EOG can continue to develop wells that yield at least 92% oil while producing an average of 2,500 boe/day, there's a very good chance both earnings and revenue growth could be positively impacted for years to come."

Well, duh.

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Crunch year ahead for Norway's Arctic oil adventure. Reuters is reporting:

Rising costs, lack of infrastructure and a string of poor exploration results may mean Norway's Arctic oil exploration peaks this year, energy officials said on Tuesday.

Drilling in the Barents Sea will reach a record high this year with 12 wells but the sector could quickly shift its focus to more promising regions if the heavy investment fails to pay off, especially as firms around the world are already cutting back capital spending plans.

"There are dark clouds gathering on the horizon because of rising costs and investment cuts by energy companies," oil minister Tord Lien told Reuters on the sidelines of a conference. "This could be a critical year for projects in the Barents Sea."

"Costs are rising too high and too fast and the Norwegian costs have increased a bit more than elsewhere," he added. Exploration in 2013 was mixed and the few notable successes were more than offset by either dry wells or small gas discoveries, which tend to be uncommercial because the area lacks the extensive pipeline infrastructure found in places like the North Sea.

Cold Winter Weather In Wisconsin Results In Fracking Sand Shortage

Wisconsin winter puts a chill on Texas oil drilling. Why? Shortage of sand.

Frigid temperatures in Wisconsin may be holding up oil and gas drilling in Colorado, Texas, and Pennsylvania. The problem? A sand shortage.

Fracking for oil and natural gas relies heavily on sand. In the hydraulic fracturing process, sand, water and chemicals are pumped into the ground to break up dense rock and coax out more fuel.

The sand acts like a stent, propping open tiny fissures that allow oil and gas to flow more freely to the surface.

Sand mines have been popping up all over Wisconsin because the state is home to a special variety of white silica that has strong, perfectly rounded grains well suited to holding open those underground cracks created by fracking.

But as any Green Bay Packers fan can attest, weather conditions in Wisconsin aren't exactly beach-like. Sand mining in ice-covered northern states was disrupted by winter weather, according to Nabors Industries Ltd., one of the biggest drillers in the U.S.

Sand shortage? EOG has it's own sand "mines" and a 20-year supply.

WSJ By-Line, Williston, ND

Front-section WSJ: Oil Boomtown Williston, ND, Looks for a Stable Future. 

This oil boomtown, known for its brawling roughnecks and their spare living conditions, is starting to smooth off its rough edges.

But not all of them. Muddy pickup trucks still jam the streets, but they drive past recent additions to town, including more than a dozen new restaurants like Buffalo Wild Wings. Subdivisions are springing up along the hills and a $73 million recreation center opened last weekend.

Actually, having just visited the Bakken, muddy 18-wheelers jam the by-pass. Willistonites probably wish it were only muddy pickup trucks jamming the streets. But the restaurant problem/shortage is a thing of the past. And coffee shops with free wi-fi are easy to find.

Enjoy.  

History Is Made In The Oil And Gas Industry -- BBR

If you have time to read only one external link, read the RBN Energy link today -- posted earlier. History in the oil and gas industry was made again, this time last month when the first unit train shipment of bitumen -- western Canadian oil sands heavy oil -- made it the 3,000 miles from its source to to the US Gulf Coast. I'm calling it BBR.

CBR: crude-by-rail; generally Bakken crude oil to the east and west coasts, but also to the Gulf
BBR: western Canadian oil sands heavy oil, from Alberta to Texas

In addition to "everything else," this article provides some background to the reason bitumen is being shipped to the US Gulf Coast and why Bakken crude is not the best fit for US refineries in the south. Wiki also reminds us that Venezuelan oil is also bitumen.

This particular linked post is one of series on the subject. RBN Energy will compare the costs of BBR vs BBP (bitumen by pipeline). Folks said CBR would not work because of the cost. Folks said CBR was a temporary fix to a short-term problem. The jury is still out whether CBR is here to stay. Regardless, one gets the feeling we might be seeing the same paradigm shift with regard to bitumen-by-rail. Does it really matter whether it's 100 miles or 3,000 miles for a unit train when it comes to "time"? Yes, the additional distance incurs an additional cost, but a) remember all the television commercials telling us how inexpensive it is to ship by rail; and, b) once the unit trains start rolling, it becomes a continuous process.

Oh, by the way, the same trains can return to Canada carrying the diluent from the Texas coast that is needed if one wants to ship bitumen by pipeline or by rail. Western Canadian operators get the needed diluent by rail from the Gulf coast.

West Canadian Sands Oil To The US By Rail (BBR) -- RNB Energy,

WOW! Remember that article from Filloon that the price of sand could go parabolic in 2014? Here it is. In the WSJ. 

Front-section WSJ: Oil Boomtown Williston, ND, Looks for a Stable Future.

Active rigs:

	4/2/2014	04/02/2013	04/02/2012	04/02/2011	04/02/2010
Active Rigs	192	184	207	170	103

RBN Energy: bitumen-by-rail (BBR) -- another must-read article.

Last month (March 4, 2014) the first unit train shipment of railbit blend bitumen crude from Southern Pacific Resources Western Canadian oil sands project arrived at Genesis Energy’s Natchez, MS terminal on the Eastern Gulf Coast. This is the first railbit unit train to hit our radar screen. Railbit has less light hydrocarbon diluent blended with it than the 30 percent required for making heavy Canadian bitumen crude flow in pipelines. So using rail to ship railbit saves some of the “diluent penalty” that pipeline shippers incur by buying diluent for blending and shipping it with their crude. Today we look at the logistics behind this ground-breaking shipment.

This blog returns to a topic that we have covered several times in the past two years. That is the transport of heavy Canadian bitumen crude. This thick, viscous crude is extracted from oil sands in the Western Canadian Sedimentary Basin and requires complex processing to extract valuable refined products. Some bitumen crude is upgraded close to the wellhead in Canada but growing volumes are being extracted and shipped to refineries closer to market – most in the United States. The largest refining market for Canadian bitumen in the US is the Gulf Coast region that houses 1.5 MMb/d of the complex coker unit capacity best suited to refining bitumen.

Without that Keystone XL 2.0 North, it's just more CBR, and now BBR, across the United States. Don't blame the oil companies. [It was on February 24, 2014, that President Obama was quoted as saying that it was just a "couple of months" before he would make a decision on the Keystone.]

The Wall Street Journal

Top story: GM CEO criticizes failure to fix switch. Well, duh, what else could she say?


Signs of cheap energy in the US: factory activity picks up. Manufacturers reported a small piockup in activity in March, a jump supporting the view that the economy is strengthening after a weather-related pause. So, what is going on in pre-market trading? The Dow is up slightly.

What a hoot: Yellen tried to humanize the plight of individuals affected by long-term unemployment. The problem: two of the three have a criminal record.

More doubts about the value of mammograms. I remember blogging about this subject when I first started blogging back in 2007. I also remember talking to Air Force spouses about this subject back in the 1990s.

NATO doesn't see likelihood of Russian shift on the Crimean/Ukraine. So what is oil doing in pre-market trading? Down about 50 cents, solidly below $100 now.

Airlines, in light of the Malaysian Airlines tragedy, is warming up to tracking of "practically" all airliners in flight by satellite.

Does Tesla need a $5 billion battery? Tesla founder seeks sites in four southwestern states for a giant electric-carbattery factory but some industry experts and rivals are skeptical. Comment: I think forks are forgetting that Tesla is a battery company, not a car company.

Caterpillar's tax strategy stirs Senate debate: let's see if the Senate does anything. LOL.

Tokyo Disney sees record number of visitors.

What's all this talk about a "bad" market. S&P 500 finishes at record high yesterday.

Corn futures jump again; seven-month high; lower planting planned this spring.

The Los Angeles Times

I knew it was bad; I did not know it was this bad. LA's job growth since the 1990 was worse than Detroit's.  

Crimea crisis highlights Germany's aversion to being in the vanguard.