Monday, May 22, 2017

Nuverra Bankruptcy; The Trials And Tribulations Of SM Energy -- Filloon -- May 22, 2017

Nuverra (formerly Power Fuels) files for bankruptcy protection. Not sure of the date the company first announced it was considering protection; the date it publicly said it would file; and the exact date of filing, but the latter must be very recent. One can go back and find many articles on pros and cons of investing in this company:
I find it interesting that one of the bigger oilfield services companies in North Dakota (and the heart of the Bakken in this case) filing for bankruptcy did not appear in The Bismarck Tribune, unless for some reason it did not get picked up by Google.

As far the founder of Power Fuels:

The Gambler, Kenny Rogers

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Trials And Tribulations Of SM Energy
At SeekingAlpha:
  • SM Energy has underperformed Permian operators in 2017 due to lackluster well results
  • Blissard 20-29 1H has produced more oil in 4 months than the average of all SM's Permian wells curved to 18 months
  • It is just one result, but this is in line with other top operators and might be the start of much better initial production rates going forward
This is the operator that was predominantly a natural gas company when it entered the Bakken. It said repeatedly -- at least that was my impression -- the company would "never leave" North Dakota. The company left North Dakota in 2016, but has delayed selling its Divide County assets due to poor prices.

From the linked article:
SM's average completion produces considerably less when compared to the average of all locations. This is significant, as SM's produce 158,930 BO compared to the 201,310 BO for the group over 18 months of wells life. One of SM's newest completions could change this. Blissard 20-29 1H only has 4 months of production, but is significantly outperforming its older location.
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Back to the Bakken

Active rigs:

$50.885/22/201705/22/201605/22/201505/22/201405/22/2013
Active Rigs512582189185

RBN Energy: the series continues -- takeaway capacity in the Marcellus / Utica. This post is on the takeaway projects to the southeast US.
One of the major target markets for Appalachian natural gas is the U.S. Southeast. More than 32 GW of gas-fired power generation units are planned to be added in the South-Atlantic states by 2020 and LNG exports from the Southeast are increasing.
Of the 15.5 Bcf/d of takeaway capacity planned for Appalachia, close to 5 Bcf/d is targeting this growing demand. Despite the need, these pipeline projects designed to increase southbound flows from the Marcellus Shale have faced regulatory delays and setbacks. Today, we provide an update on capacity additions moving gas south along the Atlantic Coast.

Sunday, May 21, 2017

At $50.99 Right Now, We Could See WTI Back Over $51 Monday -- May 21, 2017

Whoo-hoo! At 9:20 p.m. Central Time, WTI was $51.06. Another whoo-hoo! At 9:44 p.m. Central Time, WTI is at $51.22, up over 1%.

Beethoven's Fifth, David Garrett

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Another Little Tokyo, Texas Style

Late this afternoon / early evening I suggested May and I go to her favorite sushi restaurant, Kula, fairly new in the area.

Old Denton Road and President George Bush Turnpike. 

Sunday evening, 7:00 p.m., the mall is as busy as I've seen any mall. There is "no" parking left, but with a bit of driving around, waiting, we find a spot. We put our name on the list, a 50-minute wait. We visit the Japanese, Korean, Taiwanese stores in the mall. It's Little Tokyo. Just what we experienced in parts of Torrance, CA.

Then it dawned on us: this is all new and it's all because Toyota that has just moved in. 

Wells Coming Off Confidential List Early In The Week -- May 21, 2017

Wednesday, May 24, 2017
  • 31716, 184, Crescent Point Energy, CPEUSC Aldag 3-35-36-164N-100W, runs west to east (23321, 30622), West Ambrose, t3/17; cum --
  • 33156, 439, Sedalia Energy, Pratt Madison Unit 3H, Pratt, t1/17; cum 24K 3/17; , note: at this post, a graphic showing how Sedalia Energy drilled three laterals from one Madison well;
Madison wells are not fracked; no stimulation. In addition, these have been short laterals, so far. Vertical depth at 4,000 feet is about half that of a Bakken well. Madison wells typically don't have the "dreaded" Bakken decline rate. Shallow, short laterals, no fracking, and steady production over many years; previously Madison wells were simply vertical wells; now horizontal wells.
This is really quite a nice well, Sedalia, #33156: 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
MADISON3-2017319087937446420000
MADISON2-201728114391100545914000
MADISON1-2017113586333536484000


Tuesday, May 23, 2017
  • 31575, 1,530, QEP, TAT 8-33-28BHD, Grail, 65 stages, 9.4 million lbs, t12/16; cum 101K 3/17;
  • 31576, 1,392, QEP, TAT-5-33-28T2HD, Grail, Three Fork 2nd bench, 51 stages, 9.6 million lbs, t12/16; cum 70K 3/17;
  • 31577, 1,800, QEP, TAT 7-33-28BHD, Grail, t12/16; cum 110K 3/17;
  • 31829, 1,470, QEP, TAT 4-33-28T2HDR, Grail, Three Forks 2nd bench, 65 stages, 10.1 million lbs, t12/16; cum 24K 3/17;,  (26521, 26522, 26523, 26524)(27792, 27791, 27816, 21465)
  • 33169, SI/NC, Enerplus, Elbert 148-95-12D-01H-TF, Eagle Nest, no production data,
Monday, May 22, 2017
  • 30623, 210, Crescent Point Energy, CPEUSC Fairholm 3-34-33-164N-100W, West Ambrose, Three Forks, 35 stages, 2.8 million lbs, t3/17; cum 8K first month -- then taken off-line,  runs east to west (31568, 22732); first month's production: 7,275 bbls;
Sunday, May 21, 2017
  • 30725, 658, NP Resources, Beaver Creek State 41-36-1PH, Roosevelt, Pronghorn/Three Forks, 36 stages, 5.6 million lbs, t1/17; cum 19K 3/17;  
  • 32505, 865, HRC, Fort Berthold 147-94-1A-12-12H, (20879), McGregory Buttes, Three Forks, 33 stages, 9.9 million lbs, t12/16; cum 64K 3/17; on Halcon's "Oklahoma" pad;
Saturday, May 20, 2017
  • None.
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 32505, see above, HRC, Fort Berhold 147-94-1A-12-12H, (20879), McGregory Buttes:

DateOil RunsMCF Sold
3-20172155318149
2-20171968612730
1-2017138445085
12-201687445361
11-20161320

30725, see above, NP Resources, Beaver Creek State 41-36-1PH, Roosevelt:

DateOil RunsMCF Sold
3-201747562506
2-2017119635608
1-201713560
12-20162260

31829, see above, QEP, TAT 4-33-28T2HDR, Grail:

DateOil RunsMCF Sold
3-201729682102
2-201730122761
1-201740933126
12-20161355911541

31577, see above, QEP, TAT 7-33-28BHD, Grail:

DateOil RunsMCF Sold
3-20172260635126
2-20172590634527
1-20172733037397
12-20163290522297
11-20161164858

31576, see above, QEP, TAT-5-33-28T2HD, Grail:

DateOil RunsMCF Sold
3-20171896330055
2-20171378320569
1-20171077014828
12-20162545215419
11-2016397317

31575, see above, QEP, TAT 8-33-28BHD, Grail:

DateOil RunsMCF Sold
3-20171815618186
2-20172261729745
1-20172295832472
12-20163655941182
11-2016416443

33156, see above, Sedalia Energy, Pratt Madison Unit 3H, Pratt:

DateOil RunsMCF Sold
3-201793740
2-2017110050
1-201733350

Sunday, May 21, 2017 -- More On OPEC's Cuts -- Reality Sucks -- Permian Breakeven - $35; Saudi's Breakeven - $80 -- Reuters

Active rigs:

$50.905/21/201705/21/201605/21/201505/21/201405/21/2013
Active Rigs512582188188

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Reality Sucks

Updates

Later, 9:09 p.m. Central Time: OPEC caught in vicious Permian cycle -- Reuters. 
... the oil cartel looks set to extend last year's production cuts. 
Efficient U.S. wells in the Permian Basin and elsewhere, though, will benefit most and the extra supply they pump will limit any price increases. 
New methods of shale drilling have turned the Permian into one of Earth's richest oil regions. The area's Wolfcamp shale formation alone may hold 20 billion barrels of black gold, making it the second-largest field in the world behind the Ghawar region in Saudi Arabia, the U.S. Geological Survey estimated in November.
More:
Running an existing well now costs as little as $35 a barrel, having fallen significantly over the past couple of years. Saudi Arabia's absolute operating costs are lower, but its economy needs an oil price closer to $80 a barrel to hit what the IMF calls its "fiscal breakeven." 
Comment: the $80-figure is a low-ball figure.

Later, 10:50 a.m. Central Time:  I must have posted the original post about 30 minutes ago -- suggesting that OPEC's likely decision to extend production cuts (wink, wink) is not going to solve any of Saudi Arabia's problems -- and now I see that Julian Lee over at Bloomberg is saying the same thing:
Enough of this drip-feed of trying to slowly whittle away oil inventories. If OPEC wants to bring down excess stockpiles, it needs to find its courage when it meets on Thursday, dust off its old playbook and make a big cut as it did in the past.
"We’re going to do what it takes to bring the industry back to a healthy situation,” Saudi Arabia's Energy Minister, Khali Al-Falih, said in a Bloomberg Television interview in Washington back in March. Nice words, but it's going to take a lot more than words to get oil inventories, or prices, back to where OPEC wants to see them.
 More:
In 1998 -- yes, I've been doing this long enough to remember all that time ago -- OPEC slashed output by more than 4.5 million barrels a day to try to rebalance the market after the Asian financial crisis. Three years later it had to do even more as recession hit demand again, and it cut its collective output target by 5 million barrels a day. In 2008 it was forced to make another huge sacrifice, with members deciding to chop daily supply by around 4.7 million barrels.
The OPEC cuts agreed last November begin to look rather puny in comparison -- the effective reduction in April was around 1 million barrels a day, against a plan of more than 1.7 million. In that last big deal Saudi Arabia agreed to cut its own production by almost twice as much as the 486,000 barrels a day it pledged this time, taking it down to little more than 8 million barrels a day.
Many, many great graphs and data at the link. Archived.

Original Post
Put it in the bank! From Twitter, Saudi Arabia says continuing the existing cuts is more than adequate to reduce oil inventories to 5yr avg by end of Q1 2018. So, that will give us something to watch. Unfortunately the five-year average was greatly distorted by the surge in production and storage in 2015 - 2016. Getting back to the five-year average is a nice sound-bite but it's still oil priced way too low for Saudi Arabia to afford $350 billion in new arms, plus all their other expenses. Just a thought. And then what, after March, 2018, is it every Arab for himself as each country moves back to maximum production?

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Filming

School project: middle school students are making a movie. I believe that is our oldest -- 13 y/o -- granddaughter facing away from the camera with her hand on the shoulder of the male actor.  Another middle-school student is behind the movie camera.

Meanwhile, her younger sister, age 10, the middle granddaughter, appears to be the director, sitting on the chair following the "white board" and script.

I assume our youngest granddaughter, almost 3 years old, took the photograph from behind the screen door.

Saturday, May 20, 2017

Saudi Making America Great Again -- Worth Reposting -- May 20, 2017

Updates

May 26, 2017: Saudi Aramco to invest $18 billion in Texas' Motiva refinery.

May 23, 2017: six energy companies profiting from Trump's mega-deals with Saudi Arabia: Weatherford was listed first. Then Exxon Mobil; GE; Nabors Industries; Rowan Cos; and, National Oilwell Varco.


May 22, 2017: Saudi Aramco signs deals with US companies totaling $50 billion. 

May 22, 2017: National Oilwell, Saudi Aramco to form JV in Saudi Arabia to build rigs and equipment.

May 22, 2017: Schlumberger signs MOU with Saudi Aramco.

May 21, 2017: Blackston unveils $100 billion ambition for infrastructure; Saudi Arabian wealth fund commits $20 billion to the strategy; buyout firm answers Trump call to rebuild US infrastructure -- Bloomberg. 

May 21, 2017: Boeing signed a number of defense and commercial deals with Saudi Arabia during Trump's visit -- Business Insider. 

May 21, 2017: Saudi-SoftBank tech fund nears $100 billion target. From an earlier post:  
Sorting out SoftBank. Data points from today's news from The New York Times
  • SoftBank? think "ATT on steroids" in Japan -- one of Japan's largest telecom providers
  • 63,590 employees (ATT: 246,740 employees)
  • solar power business
  • humanoid robots for home use
  • ride-booking services 
  • financial technology 
  • 2016: SoftBank + Saudi Arabia -- set up a $25 billion private fund for technology investments; could grow to $100 billion  (think "Shark Tank on steroids")
  • SoftBank: committed to creating 50,000 jobs in the US and investing $50 billion in US startups
  • first huge partner: OneWeb
  • OneWeb has obtained $1.2 billion from SoftBank
  • OneWeb: plans to build a network of satellites to provide global broadband access; 
  • the $1.2 billion: finance the construction of a factory in Exploration Park, Florida; to produce 15 satellites per week at low cost; could result in 3,000 jobs at this site; I think I read elsewhere the company's goal is to place 720 telecommunication satellites in space
May 21, 2017: corporate CEOs "descend" on Riyadh:
Top executives who descended on Riyadh for a CEO summit timed to coincide with Trump’s visit included JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon, Blackstone Group LP CEO Steve Schwarzman, and Marillyn Hewson, the CEO of Lockheed Martin Corp.
Saturday’s meeting, the “Saudi-U.S. CEO Forum,” drew the kind of corporate firepower Trump suggested he could harness when he ran for the Oval Office as a Washington outsider/business executive who would reach outside the Beltway and enlist other executives in support of the administration’s economic goals.
More than 30 CEOs of major U.S. companies were on hand for the summit, at the Four Seasons Hotel in Riyadh. Some later joined Trump and Saudi officials at the Royal Court Palace for a deal-signing ceremony. Those who spoke to reporters said they weren’t put off by drama surrounding the Trump White House. “We’re just seeing tremendous opportunity with Trump coming here,” said Steven Demetriou, CEO of Jacobs Engineering Group.
This will overshadow any climate warming conference in quality and quantity (dollars).

May 21, 2017: GE announces $15 billion of business deals with Saudi Arabia.

May 20, 2017: Blackstone (US) and Saudi Arabia's Public Investment Fund (PIF) each pledge $20 billion ($40 billion total) for US infrastructure projects. 

May 20, 2017: $100-billion deal? LOL. It's $110 billion immediately and $350 billion over 10 years. I did not read the story; just the headline. But one must remember this: the Saudis will need foreign expertise to do all they plan including a new militant monitoring operations center, and one can assume "the Donald" was assured by the Saudis that American companies would get first crack at new ventures. I would assume most military hardware will come from the US. By the way, this is single largest arms deal in the history of the US. And had someone else been president, it's very likely Russia would have gotten the sale. Just saying.

May 17, 2017: John Kemp --  SENIOR Gulf OPEC source wonders how to square billions of dollars of deals to be signed in KSA during Trump visit with austerity programme?

Original Post
(May 14, 2017)

Link to original post.

From Reuters: among everything else, it looks like Trump will announce a $100-billion-arms-deal for Saudi Arabia on his Mideast tour. From the article: 
The arms package could end up surpassing more than $300 billion over a decade to help Saudi Arabia boost its defensive capabilities while still maintaining U.S. ally Israel's qualitative military edge over its neighbors.
Which means Israel is going to get some kind of huge arms deal also. 

It also begs the question where Saudi Arabia will come up with the money. Perhaps some Wall Street bank. You think?

President Obama first visited Riyadh about the very same time in his first term also (June 3 - 4, 2009) and according to wiki it was mostly discussion, not much substance. Nice bow, though. 

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Saudi's Got Talent


Wrong On So Many Levels, Sultan

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New Stuff
Link here.