"New Kind Of Storage Of Crude Oil In The Bakken" -- Not Really; Folks Are Simply Catching Up With Reality: DUCs -- August 28, 2015

This is cool. We've talked about this many, many times. Now it's being tweeted:

Wells underground in ND, TX & CO can be brought on line in few days are new kind of storage, says Dave Ernsberger.

Regular readers have known this for ... like forever....

Random Look At Source Of Oil Production In The US -- August 28, 2015

Updates

Later, 11:52 a.m. Central Time: the story in Oil & Gas Journal -- a fascinating article with timeline of hurricanes and tropical storms and how they affected oil production in the Gulf of Mexico, from 2005 to 2015. In 2005, for example, pre-Katrina, 1.5 million bopd; trough due to Katrina, 0.5 million bopd, returning to baseline of 1.3 million bopd through 2008. Hurricane Gustave dropped production to 0.3 million bopd, subsequently rebounding to 1.75 million bopd and then waxing and waning to current 1.5 million bopd today. Hurricane Ida (2009), TS Bonnie (2010), Tropical Storm Lee (2011), Hurricane (barely) Isaac (2012), and Tropical Storm Karen (2013) resulted in very little disruption. No production was affected during the 2014 (last year's) hurricane season.

Original Post

 

This little nugget helps me immensely -- see the EIA "energy cookie" below. I assume off-shore oil for the US comes from West Coast (problematic); East Coast ("none");  Gulf Coast (decreasing); and, Alaska (stable to decreasing). (Actually the data was easily retrievable elsewhere -- the EIA note today didn't tell anything we didn't already know, but it gave us a chance to look at the tea leaves going forward.)

Alaskan North Slope oil production is decreasing, at best stable. California -- the tea leaves suggest production is not going to increase significantly. At $45 oil, operators are circling the wagons to focus on only the best plays (the Bakken, the Permian, and the Eagle Ford).

So, when I put this all together, it looks like bulk of US oil production comes from the three shale plays and the Gulf of Mexico. There's not a lot of slack.

Now the EIA "energy cookie":

Hurricane-related risk to total U.S. crude oil and natural gas production has decreased over recent years as the share of total U.S. production originating in the Gulf of Mexico has declined sharply. In 2003, 27% of the nation's crude oil was produced in the Gulf of Mexico; by 2014, that share had declined to 16%. The Gulf of Mexico's share of natural gas production has also declined from a high of 26% in 1997 to 5% in 2014. --- EIA

If I did the math correctly, the US produces about 8.7 million bopd (2014).

The Bakken produces about 1 million bopd which works out to about 11% of total US production. Which isn't a whole less than the 16% that comes from the Gulf of Mexico.

The Bakken, it seems is sort of the Tesla in the oil and gas industry: from almost "0" in 2007 to over 10% of the nation's production some seven or eight years later.

For The Archives: Random Update On President Obama's Clean Power Program -- August 28, 2015

For the archives, the StarTribune is reporting that Minnesota and North Dakota must work together to meet President Obama's Clean Power Program.

If one get past the emotion and politics, this is an incredible opportunity for North Dakota.

Some data points:

• states required to start cutting greenhouse gas emissions by 2022
• states must comply by 2030
• compliance standards vary from state to state
• North Dakota: cut CO2 emissions by 40% from coal-fired generators (from projected 2020 levels)
• Minnesota: a 27% drop (but Minnesota has a "cleaner energy mix" already)
• details still being worked out
• states have until 2018 to submit plans; otherwise EPA will step in and "help them"
• North Dakota will get an opportunity to see how things might go in a case currently being appealed by Minnesota with regard to a Minnesota law that bans imports of "new" coal-based electricity (North Dakota won the first round in a lower federal court, but it is now before the Eighth US Circuit Court of Appeals)

As this plays out, there will be winners and losers, as there always are, but the Federal government is giving  us three years to sort out who the winners / losers might be.

It's buried in the article, but it appears that investment in wind farms in the short term is most problematic due to uncertainty in the new regulations. 

But this is where it gets very exciting. Look at the shift in the source of electricity production between 2004 and 2015. I think the oil and gas industry in North Dakota is likely to come out a winner when it's all said and done.

Random Note On Refined Products From Crude Oil -- August 28, 2015

I don't know if I interpreted this note correctly from a reader, but it appears he sent me an update of what refiners are getting from a barrel of oil, or what consumers are paying for barrel of oil after it's been refined. The figures come from the EIA.

From one barrel of crude oil, as an example:

• 30%: 12.3 gallons of gasoline = $35.67
• 19%: 8 gallons of jet fuel = $14
• 23%: 9 gallons of diesel = $27
• 22%: 8.5 gallons of fuel  oil = $21.25

Total, 94% = $97.92 of refined product per bbl of crude oil.

The other 6% is "petroleum coke" and "fuel gases."

Gasbuddy also provides a breakdown of refined products.  I assume the percent of refined products varies significantly based on many, many factors.

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Seeing Stars

I see Buzz Aldrin, age 85, is working on a master plan to colonize Mars by 2040. I assume Elon Musk will be joining the staff at the new Buzz Aldrin Space Institute, Florida Institute of Technology, as soon as he figures out how he can get the federal government to fund the entire institute.

Buzz says they will get to Mars using "cycling pathways." Bike paths to Mars.

The Whiting Obrigewitch Wells In Stark County

Original Post (production numbers are updated)

 

I see Whiting has a rig working in Bell oil field, Stark County.

Three Forks (Pronghorn Member) is often the way the payzone for these wells is described. The Pronghorn is the upper portion of the Three Forks. Note the very small amount of proppant used for one of these wells back in 2011 (#19623 below).

Whiting Obrigewitch wells in southwestern North Dakota:

• 31907, 616, Whiting, Obrigewitch 24-9PH, Bell, t5/17; cum 230K 10/20;
  
• 31160, 584, Whiting, Obrigewitch 44-19PHU, Bell, t3/16; cum 194K 10/20;
• 31159, A, Whiting, Obrigewitch 24-20PH, Bell, t -- ; cum 368K 10/20;
• 31158, 1,097, Whiting, Obrigewitch 11-29PHU, Bell, t2/16; cum 233K 10/20;
• 31157, 855 , Whiting, Obrigewitch 21-29-2PH, Bell, t4/16; cum 148K 10/20;
• 31153, 975, Whiting, Obrigewitch 31-29PH, Bell, t3/16; cum 188K 10/20;
• 30640, 457, Whiting, Obrigewitch 44-8PHU, Bell, 4 sections, 45 stages, 5.1 million lbs, t6/17; cum 229K 10/20;
• 30634, 1,362, Whiting, Obrigewitch 34-20PH, Bell, t3/16; cum 405K 10/20;
• 30343, 985, Whiting, Obrigewitch 44-20PHU, Bell, 14 days, t11/15; cum 365K 10/20;
• 30342, 1,536, Whiting, Obrigewitch 41-29PHU, Bell, 14 days, t11/15; cum 276K 10/20;
• 22864, 1,890, Whiting, Obrigewitch 41-17PH, Bell, t11/12; cum 229K 10/20;
• 25454, 1,614, Whiting, Obrigewitch 11-29PH, Bell, 30 stages, 2.3 million lbs, t9/13; cum 142K 10/20;
• 25453, 2,027, Whiting, Obrigewitch 21-29PH, Bell, t9/13; cum 179K 10/20;
• 25452, 1,171, Whiting, Obrigewitch 41-29PH, Bell, t9/13; cum 147K 10/20;
• 23468, 1,244, Whiting, Obrigewitch 11-16PH, Bell, t12/12; cum 226K 10/20;
• 22864, 1,890, Whiting, Obrigewitch 41-17PH, Bell, t11/12; cum 229K 10/20;
• 22287, 1,738, Whiting, Obrigewitch 41-16PH, Bell, t11/12; cum 317K 10/20;
• 21018, 1,517, Whiting, Obrigewitch 11-17TFH, Bell, t2/11; cum 305K 10/20;
• 20079, 2,760, Whiting, Obrigewitch 21-16TFH, Bell, t2/12; cum 388K 10/20;
• 19623, 1,075, Whiting, Obrigewitch 21-17TFH, 7 stages, 6,848 lbs (no typo), Bell, t4/11; cum 284K 10/20;

The graphic: