Sunday, November 1, 2015

With Cancellation Of Spiritwood Fertilizer Plant, MDU Cancels 96-Mile Pipeline -- November 1, 2015

Natural Gas Intel is reporting:
With a collapse of plans for a highly promoted multi-billion-dollar fertilizer plant in the state, North Dakota-based MDU Resources Group's pipeline unit on Wednesday pulled its application at FERC for a 96-mile, 20-inch diameter natural gas pipeline that would have served the proposed plant.

The prospects for MDU's WBI Wind Ridge Pipeline became doubtful last August when St. Paul, MN-based agricultural cooperative conglomerate CHS Inc. decided to drop its plans to develop a major natural gas-based fertilizer plant. On Wednesday, WBI Energy withdrew its pre-filing application at the Federal Energy Regulatory Commission for the proposed pipeline extension and a related compressor station near Spiritwood, ND.

Originally touted three years ago, the project was endorsed by North Dakota Gov. Jack Dalrymple as the largest single private investment ever proposed in the state. The plant was slated for 200 acres in Spiritwood and was expected to add 100-150 new jobs.
I track Spiritwood here. 
Posted by at

Lime Rock Resources

This is simply some housekeeping. I am adding Lime Rock Resources and Vanguard Natural Resources to one of the sections at the sidebar at the right. This is where these entities will now be tracked. I am not yet sure if Lime Rock Resources is a subsidiary of Vanguard Natural Resources, but that will sort itself out later.

As usual, the background is down below; the updates are below, newest updates listed first.

Updates

December 7, 2016: update on Lime Rock activities back to November 2, 2015:
  • DUCs reported as completed:
  • Permits renewed:
  • Stroh wells: updated through October, 2016 
  • NDIC ArcIMS viewer: no active rigs in Cabernet oil field
  • Bottom line: it appears Lime Rock Resources is "cleaning" up its Fidelity permits (renewing and canceling); and, completing DUCs at the rate of about one/month.
November 2, 2015: analysts are already talking about re-frac opportunity for Lime Rock in the OXY deal in the Bakken. 

Updates prior to end of October, 2015:
***************************
Background

Vanguard Natural Resources
Business Summary from Yahoo!Finance:
Vanguard Natural Resources, LLC, through its subsidiaries, acquires and develops oil and natural gas properties in the United States. It owns properties, and oil and natural gas reserves primarily located in nine operating basins, including the Arkoma Basin in Arkansas and Oklahoma; the Permian Basin in West Texas and New Mexico; the Big Horn Basin in Wyoming and Montana; the Piceance Basin in Colorado; the Gulf Coast Basin in Texas, Louisiana, and Mississippi; the Wind River Basin in Wyoming; the Williston Basin in North Dakota and Montana; the Green River Basin in Wyoming; and the Powder River Basin in Wyoming. As of December 31, 2014, the company had total estimated proved reserves of 2,031.3 million barrels of oil equivalent, as well as owned working interests in 9,759 gross productive wells and approximately 870,140 gross undeveloped acres. Vanguard Natural Resources, LLC was founded in 2006 and is headquartered in Houston, Texas.
Vanguard Natural Resources: website.
Relationship between Vanguard Natural Resources, Lime Rock Energy (LRE), and Lime Rock Resources (my notes are not ready for "Prime Time" but are being posted for my benefit only -- if this information is important to you, go to the source. My information is likely to have typographical and factual errors.

Disclaimer: the usual disclaimer holds. This is not an investment site. Do not make any investment or financial decisions based on anything you read here or think you may have read here. 

From my notes to another reader:
There is an entity called Vanguard Natural Resources.

Recently it merged / bought / whatever / LRR Energy (traded on NYSE as LRE).

At this website it shows Eric Mullins and Charlie Addock as the co-CEOs of LRR Energy: http://www.businesswire.com/news/home/20150420006784/en/Vanguard-Natural-Resources-Announces-Deal-Acquire-LRR.

At the Lime Rock Resources site, it shows the same two (Eric Mullins and Charlie Addock) as co-CEOs of Lime Rock.

At the press release linked above, in August, 2015: "As a result of the transaction, LRR Energy and its general partner will become wholly owned subsidiaries of Vanguard."

Also, at that merger press release linked above: "On the closing of the transaction, LRR Energy will be terminating the existing management services agreement with Lime Rock Management LP and Lime Rock Resources Operating Company, Inc."
I don't know if that means Lime Rock Resources is cut loose to become its own entity or whether it is a subsidiary of Vanguard Natural Resources. I assume the latter.
Posted by at

Oasis Reports Four Nice Wells -- November 1, 2015

Monday, November 2, 2015
  • 27421, conf, CLR, Garfield 4-5H, Banks, file report suggests this well is SI/NC;
  • 30231, dry, BR, Old Hickory 43-32MBH, Sand Creek, not sure what this was all about; drilled to kick-off point; then plugged; re-entered with "Plan B"; this seems also to have gotten nowhere; on a 4-well pad;
  • 31011, SI/NC, Newfield, Wahus Federal 152-97-13-24-11H, Westberg, cum 9K over 12 days, unfracked
Sunday, November 1, 2015
  • 28633, 1,575, Oasis, Chalmers 5300 21-19 5T, Baker, t7/15; cum 41K 9/15;
  • 28634, 1,606, Oasis, Chalmers 5300 21-19 6B, Baker, 36 stages, 3.9 million lbs; t7/15 cum 20K 9/15;
  • 28636, 1,456, Oasis, Chalmers 5300 21-19 8T, Baker, 36 stages, 4 million lbs; t7/15 cum 27K 9/15;
  • 28744, 3,109, Oasis Wade Federal 5300 41-30 9B, Baker, t6/15; cum 60K 9/15;
  • 29867, SI/NC, BR, Kirkland 14-21TFH, ULW, Pershing, will be shut-in for the reason that the gathering line infrastructure to connect the well does not exist and/or has not been built at this location yet; this well has not been completed and it will be shut-in until the infrastructure is built.
  • 30437, SI/NC, SM Energy, Anne 13-19HN, West Ambrose, no production data,
Saturday, October 31, 2015
  • Nothing came off the confidential list this date because there were only 30 days in April, 6 months ago.
*******************************************

28744, see below, Oasis Wade Federal 5300 41-30 9B, Baker:

DateOil RunsMCF Sold
8-2015159200
7-2015239040
6-201575510

28636, see below, Oasis, Chalmers 5300 21-19 8T, Baker:

DateOil RunsMCF Sold
8-2015175635010
7-201583201764

28634, see below, Oasis, Chalmers 5300 21-19 6B, Baker:

DateOil RunsMCF Sold
8-201587442915
7-201594273937

28633, see above, Oasis, Chalmers 5300 21-19 5T, Baker:

DateOil RunsMCF Sold
8-2015148649749
7-2015146397340
Posted by at

Minor Notes -- As Many As Six Air Forces Might Now Be Flying Over Syria -- November 1, 2015

Minor Notes

Mideast natural gas: updating the natural gas fields in Egypt and Israel.

Chinese buying US oil assets: Business Insider has a story on private equity giants selling their shale to China. This may come back to be a story that we see in the Bakken. Just saying. The most recent Chinese - Texas deal was posted on the blog.
Very interesting story unfolding this week in the U.S. energy sector; showing several twists emerging amongst the players in this space, old and new.
The Wall Street Journal broke the story Sunday that a new operator is breaking onto the scene in shale. Namely, billion-dollar Chinese property development company Yantai Xinchao. [Referred to as "Yankee Ka-Ching-Ka-Ching" in Beijing.]
According to filings, that firm has reached a deal to acquire a package of oil assets in west Texas. Few details were given on the properties -- but the price tag for purchase is significant, at around $1.3 billion.
The company did specify that this billion-dollar property package is located within Texas' Howard and Borden counties, an area that would put the assets within the shale oil hotbed of the Permian Basin.
I try to track some of these deals over at "Asian Connections." While the government seems forever to approve the HAL-BHI merger, and killed the Keystone, it has no trouble approving the sale of crude oil assets to China.

Flipping crude oil producing property: at this website, click on the asset to see acquisition date and exit date.

***************************************
Downed Russian Jet

Updates

November 2, 2015: Russian airline rejects human, technical causes for Egypt crash.  Link here. 

Original Post
 
First hunch may have been correct. Immediately after news of the downed Russian a/c killing 224 on board, I wrote Don:
  • most dangerous aspects of commercial flying, non-terrorist-related mishaps: take-offs and landing
  • once at cruising altitude, most likely reason for unexplained crash: terrorists
The plane was 25 minutes into flight; well past take-off and leveling off.

We now learn that the plane was cruising at 36,000 feet when something happened:
The Egyptian officials said the aircraft was cruising at 36,000 feet when contact with the jet was lost. Flight-tracking service FlightRadar24 said the plane was losing altitude at about 6,000 feet per minute before the signal was lost, Reuters reported.
************************************ 
Wages

The mystery of the vanishing wage increase -- the New York Times -- the jobs market is "a lot softer" than a 5.1% unemployment rate would indicate -- exactly what I've been posting  on the blog for six years:
Amid the global economic turmoil and seesawing markets, millions of Americans have one overriding question: When will my pay increase arrive? The nation’s unemployment rate has fallen substantially since the end of the Great Recession, sliding to 5.1 percent from 10 percent in 2009, but wages haven’t accelerated upward, as many had expected.
In fact, the labor market is a lot softer than a 5.1 percent jobless rate would indicate. For one thing, the percentage of Americans who are working has fallen considerably since the recession began. 
This disappearance of several million workers — as labor force dropouts they are not factored into the jobless rate — has meant continued labor market weakness, which goes far to explain why wage increases remain so elusive. End of story, many economists say. 
But work force experts assert that economists ignore many other factors that help explain America’s stubborn wage stagnation.
Outsourcing, offshoring and imports exert a steady downward tug on wages. Labor unions have lost considerable muscle. Many employers have embraced pay-for-performance policies that often mean nice bonuses for the few instead of across-the-board raises for the many.
Peter Cappelli, a professor at the Wharton School of Business, noted, for instance, that many retailers give managers bonuses based on whether they keep their labor budgets below a designated ceiling.
In recent years, wage increases, before factoring in inflation, have averaged about 2 percent annually. But real, after-inflation wages have remained dismayingly flat since 2009, according to the Bureau of Labor Statistics, even though real wages did bump up last fall when the drop in oil prices pulled down inflation. (In a minority view, the Heritage Foundation and some other conservative groups say the bureau has underestimated wage increases.)
"After -inflation wages have remained dismayingly flat since 2009." What year did President assume ... office ... oh, that's right. 2009. 

We're gonna need some multi-lingual air traffic controllers (air) and forward air controllers (ground) to deconflict all manned air forces and all the unmanned air forces in Syria (US, Russia, Syrian, Israeli, Iranian, Saudi, Turkey). The Syrian conflict has become a) a free-for-all; and, b) a Turkey shoot. Currently being tweeted:  Israel carries out airstrike on Syrian regime base in Qalamoun, destroying 3 warehouses holding Scud-missiles.

******************************
Wind
800 Slicers And Dicers Coming Down In California

This deserves a stand-alone post, but I'm trying to de-emphasize intermittent energy and stay focused on the Bakken, but it's very, very difficult. This is a most interesting story. Maybe someday when I have time, I will re-post this as a stand-alone. It's a huge, huge story.

The San Jose Mercury News is reporting that 800 wind turbines in the Altamont Pass (California) are coming down. A win for the birds:
A wind power provider that operates about 800 turbines in the Altamont Pass -- where thousands of birds are believed killed by them each year -- is shutting down its operations.
Altamont Winds told the U.S Fish and Wildlife Service in an email Oct. 23 that it is ceasing operations as of Sunday.
The decision was applauded by environmental groups, which for years have been fighting to build awareness around the large numbers of golden eagles, raptors, burrowing owls and other birds that are killed by turbines.
There's a lot more to the story, but that's where I will leave it for now.

******************************* 
Notes From All Over

Notes from my daughter / son-in-law in Portland, OR, regarding Halloween last night:
We had one little boy about 4, maybe, come through in a group of 4 kids. Anyway, he was a minion, very cute, and he stumbled on our step and hit his head (not hard, just a tap) on the door frame and then nearly toppled into our house. After he left, I told Tim, "He was dedicated to being in character."
Posted by at
Labels: ,

The Bakken Economy -- November 1, 2015

The Williston Airport

The Dickinson Press is reporting discord among the Williams County commissioners on the new Williston airport. Whatever. I don't think there is anything new in the article except to hear from some opponents of the airport. Whatever. Some data points:
  • tentatively: ground will be broken in the spring
  • 1,540-acre site
  • goal: completion by 2018; a very aggressive timetable, according to some
  • new airport is a $254 million project
  • has received $27 million in federal funding
  • state has dedicated $59 million (to date)
  • Williston is negotiating with FAA for long-term, large-scale project funding: $120 million
  • rest of funding will come from proceeds from sale of current airport (740-acre parcel)
  • the process for land acquisition has started
  • a 2-mile road off the city's new truck bypass will lead to the airport
  • current airport operating outside of FAA standards
  • $240 million would be need to bring existing airport into compliance compared to $254 million for a new facility
With regard to the two county commissioners opposed to this, ask yourself: "What would Harold Hamm do?"

Other links regarding the Williston airport:
There were scores of other posts on air travel into Williston during the boom; they were not linked.

*****************************
SM Energy

This is a most interesting and unexpected story. The Dickinson Press is reporting that SM Energy has opened a new Williston office complex; located north of Williston. It was unexpected because I thought they were talking about a "new" complex. If this is the one I think they are talking about, it's been under construction for quite some time now. I've seen the complex while it was being built during my past two visits to the Bakken. I thought this story was about yet another SM Energy. My bad. Whatever.

So, SM Energy has opened their new complex north of Williston. Some data points:
  • SM Energy has not yet laid anyone off
  • SM Energy is working a sweet spot well north of North Dakota, in Divide County
  • SM Energy has been in Williston since 2008; started with eight employees; now 105
  • headquartered in Denver; regional offices in Billings, Houston, Midland 
  • satellite offices in Divide County, Watford City, Sidney (MT), and Belfield
  • Bakken HQ: Williston
  • 28,000 square feet
  • fitness center with men's and women's locker rooms
A spokesman mentioned these positives for putting the complex north of Williston:
  • their focus is in Divide County; ease of getting to Divide County -- just drive straight north
  • airport (current location; new location)
  • trucker reliever route (goes right by their complex)
Oil production out of the Bakken:
  • 31,000 boepd; 580 active wells; about 12 million boe annually out of the Bakken; 2 rigs through 2016
  • determines the number of rigs based on cash flow; not on price point or borrowing base
Company-wide production: 64 million boe per year

Note comment about SM Energy at this posted, dated November 6, 2015.

******************************
An E-Mail From The Field

The other day I received a long e-mail from a reader who recently visited his "homesite" in the Bakken. Some observations of his while traversing the Bakken three times over the past six weeks:
Just the south half of the new, heavy-duty replacement of the 4-lane stretch of Hwy 2, between Tioga and the junction with Hwy 85, north of Williston, was open to traffic.
The roughly 4-mile piece of ND Hwy 40 that links Tioga to Hwy 2 is still a mess but a great work in progress. With pouring of the west lanes proceeding, a glimpse is offered of the blessed relief to come, upon completion.

Having experienced speed reductions down to 15 mph on that short stretch to or from Tioga, for my next traverse I decided to avoid Tioga altogether by continuing north on Hwy. 85 from Williston almost to the Canada line. That would surely save time. Where Hwy 85 leaves Hwy 2, however, a sign greeted me with "45 mph next 21 miles."

But no matter --- the roughly 75-mile stretch ahead of me was beautifully serene, although worthily included on the short-list of oil-producing counties. I would be hard pressed to call any visible Big Oil impacts "blemishes." That is not to say there haven't been illegal, gross or disgusting spills, but it is also remarkable how quickly disturbances from trenching for oil, gas and fresh or "produced" water pipelines recover, after construction.

The inconveniences from road construction amounted to but a small blip in overall driving pleasure across the Bakken. I have never been prouder of my home state.
The road improvements between Williston and Watford City, including the Williston by-pass (just dedicated), and those at Alexander and Watford City were breathtaking and beautiful, as was the remaining 2-lane stretch south to the Interstate at Belfield. The Badlands and Theodore Roosevelt Park were stunning---the golden fall foliage enhanced all the more, by the greening of the prairie grasslands from recent rains.
I tried to capture the feeling of the Williston, Watford City, and Alexander bypasses in previous posts, but I was unable to say it as well as this reader. The Williston truck reliever route is utilitarian at the moment but its character will change a 100-fold when the new airport is in place.

On the other hand, the Watford City and Alexander bypasses truly are breath-taking. These are expanses of asphalt and cement no one would expect in this remote region of the United States. They would make great alternate emergency landing runways for the Space Shuttle.

Up in Divide County, the reader is describing exactly what the other land owners in that county seem to be expressing with regard to SM Energy -- see previous story.

So much more could be written, but I must move on.
Posted by at
Labels: ,
Subscribe to: Posts (Atom)