Sunday, December 12, 2021

Sinclair Fracking With Large Amounts Of Water -- December 12, 2021

The other day we took a look at the wells recently posted by Sinclair. I didn't get a chance to look at the frack data until today. Looking at one of those wells, it appears Sinclair is completing these wells with large fracks, using over 12 million gallons of water. This is in contrast to MRO recently reporting wells fracked with six million gallons of water.

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The Bruin FB Belford Wells -- Rolling Out Bakken 4.5 -- December 12, 2021

Updates

December 20, 2021, full note here:

  • 36302, conf, Bruin, FB Belford 148-95-22D-15-14B-LL, Eagle Nest, 33-025-03775, first production, 6/21; t--; cum 123K 10/21; FracFocus reports two fracks, which we've discussed before:
    • first frack, 5/11/21 - 5/22/21: 8.367 million gallons of water, 83.04421% water by mass; 10.22434% sand by mass;
    • second frack, 5/11/21 - 5/22/21; 8.939 million gallons of water; 83.04421% water by mass; 10.22434% sand by mass;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021301858318622102982584222537305
BAKKEN9-202113128801273482571416212223146
BAKKEN8-20213131390313463667039998379391241
BAKKEN7-20212940500405414020743835424321403
BAKKEN6-20211119332190162192217927163831209

December 17, 2021: an update with frack data. 

Later, 4:29 p.m. CT: a reader replied to the "pad drilling" issue --

A few years back, some industry executive was explaining some of the economics behind not only 4 to 6 wells per pad simultaneously being drilled/completed, but also the then-emerging trend of simultaneously developing 3 to 4 pads in close proximity.

Interesting perspective. 
Taking those six Bruin wells that you have noted for example, at $6 million per well, Bruin would have 'pre-paid' $36 million before any revenue came back. 
With a cumulative production just over half a million barrels (~511,000) and $50/bbl pricing, Bruin would have already grossed about $25 million in oil revenue and $2 million from the gas ... roughly. 
It may take till the end of a year, but Bruin may be 'in the money' after 12 month's time.

For operators doing this on, say, four pads simultaneously, the capital outlay could approach $150 million prior to any revenue coming in. 
Definitely a game for the Big Boys. 
(That executive also stressed that the logistics could be daunting trying to develop 16/20 wells simultaneously, but the 'discount/efficiencies' could be well worth it when giving a LOT of business to the chosen oil field service contractors).

By the way, there's another way for smaller companies like Bruin to pay for the fracking. [The drilling costs are almost inconsequential compared to everything else, especially fracking.] Some operators will share in the production with the servicing / fracking companies to pay off the costs of the work. I've seen that talked about elsewhere -- overseas? I don't know if it's being done in the Bakken?  

Regardless, once the cash flow starts, it becomes easier to tackle the next big project. 

Original Post

Well, well, well -- no pun intended. LOL. I've been waiting to roll out Bakken 4.5, and today is the day. Rolling out Bakken 4.5.  

Bakken 4.5 is defined as the period in which we, as observers, move from a focus on single-well completions, and start to focus on pad drilling. Yes, pad drilling has been going on for several years now, but mostly by a handful of operators. Now, it has become the norm for all operators. 

In fact, if an operator is not pad drilling, that operator may not be around for long. It's just too inefficient and expensive not to be pad drilling (infill / development wells; this does not apply to exploratory wells). 

But before moving into Bakken 4.5 I wanted to see:

  • a recovery in the price of oil, which we have; and,
  • the "end" of Covid-19 determining activity in the shale plays; and, perhaps to some extent,
  • shale-operator CAPEX discipline

If the third "factor" (shale-operator CAPEX discipline) moved to hyper-activity / insane CAPEX increases, then I would move directly to Bakken 5.0.

These are incredibly good wells. I can't remember my early thoughts on the Eagle Nest oil field. Let's look together. The Eagle Nest is tracked here, but like all fields, I have not kept up with the updates. But that's fine. The original posts were done during the boom. March 25, 2012, the original assessment:

Forty-four sections as of March, 2012. A very active field with four rigs on site as of March, 2012. The field is noted for its multi-well pads. Major operator is Petro-Hunt. One of the most scenic highways in North Dakota, state highway 22, pretty much splits the field in half, east half from west half.  This is going to be a great field.

**********************************************
The Bruin FB Belford Wells

The wells: 

  • 22300, SI/A, Bruin, FB Belford 148-95-22D-15-2T, Eagle Nest, 33-025-01602, first production, 8/21; t--; cum 23K 10/21; 
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021319772974875941194690991281
BAKKEN9-2021251168811627857013973108311143
BAKKEN8-2021516011600153551263762403
BAKKEN7-20210000000
BAKKEN6-20212001375830919897
  • 22301, SI/A, Bruin, FB Belford 148-95-22D-15-3B, Eagle Nest, 33-025-01603, first production, 6/21; t--; cum 154K 10/21; 41K over 22 days extrapolates to 56K over 30 days;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-20213123999239391283142918341294804
BAKKEN9-2021292559225709833938079304113209
BAKKEN8-20213131608315861656138864331993561
BAKKEN7-20212731950320042058433191289214270
BAKKEN6-202122411924064345859411112664313138
  • 36302, conf, Bruin, FB Belford 148-95-22D-15-14B-LL, Eagle Nest, first production, 6/21; t--; cum 125K 10/21;
DateOil RunsMCF Sold
10-20211862222537
9-20211273412223
8-20213134637939
7-20214054142432
6-20211901616383
  • 36303, conf, Bruin, FB Belford 148-95-22D-15-13T-LL, Eagle Nest, 33-025-03776, first production, 6/21; t--; cum 125K 10/21;
DateOil RunsMCF Sold
10-20212630239502
9-20212323131333
8-20212251226863
7-20212983031424
6-20212333521
  • 36304, conf, Bruin, FB Belford 148-95-22D-15-10B, Eagle Nest, first production, 6/21; t--; cum --:
DateOil RunsMCF Sold
10-2021139988955
9-202137341312
8-20211356412776
7-20212914326836
6-20212502915594
  • 36305, conf, Bruin, FB Belford 148-95-22D-15-8T, Eagle Nest, 33-025-03778, first production, 6/21; --; t--; cum 102K 10/21; obviously, 24K over 15 days extrapolates to 48K over 30 days:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-20213115440154011331323138180482541
BAKKEN9-20212818805188541423826295208692202
BAKKEN8-20213119061190482327024391206332213
BAKKEN7-20213124105241363342929890260453845
BAKKEN6-20211524092237713964326627175038631
  • 36306, SI/A, Bruin, FB Belford 148-95-22D-15-7B, Eagle Nest, 33-025-03779; first production, 6/21, --; t--; cum 161K 10/21; 34K over 18 days extrapolates to 56K over 30 days:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021311928919241707130953243403426
BAKKEN9-2021282506325138850237416299323159
BAKKEN8-20212731726317041556939810340653654
BAKKEN7-20212950996510402614065504570778427
BAKKEN6-202118336933324437265403212648813062
  • 36307, SI/A, Bruin, FB Belford 148-95-22D-15-6T, Eagle Nest, first production, 10/21; t--; cum --;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-20213128822874686926051864262
BAKKEN9-20216002925921192
BAKKEN8-20216004048119172
BAKKEN7-20210000000
BAKKEN6-2021162611371825226


Graphics:


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Initial Production For Wells Coming Off The Confidential List This Week -- December 12, 2021

The wells:

  • 38185, conf,  CLR, Tallahassee FIU 7-21H, Baker,  no production data,
  • 37189, conf, Whiting, Feehan 11-9HU, Sanish, first production, 7/21; t--; cum 64K 10/21;
  • 36302, conf, Bruin, FB Belford 148-95-22D-15-14B-LL, Eagle Nest, first production, 6/21; t--; cum 125K 10/21;
DateOil RunsMCF Sold
10-20211862222537
9-20211273412223
8-20213134637939
7-20214054142432
6-20211901616383
  • 38186, conf, CLR, Tallahassee FIU k6-21H, Baker, no production data,
  • 36771, conf, Hess, BL-A Iverson-155-96-1312H-9, Beaver Lodge, first production, 6/21; t-- cum --;
DateOil RunsMCF Sold
10-20211196222875
9-202162019102
8-2021440
7-202162955989
6-2021732911536
  • 36303, conf, Bruin, FB Belford 148-95-22D-15-13T-LL, Eagle Nest, 33-025-03776, first production, 6/21; t--; cum 125K 10/21;
DateOil RunsMCF Sold
10-20212630239502
9-20212323131333
8-20212251226863
7-20212983031424
6-20212333521
  • 38187, conf, CLR, Tallahassee FIU 5-21H, Baker, no production data,
  • 38188, conf, CLR, Tallahassee FIU 4-21HSL, Baker, no production data,
  • 37352, conf, Oasis, Wold 5397 44-34 12TX, Sand Creek, first production, 6/21; t--; cum --;
DateOil RunsMCF Sold
10-20211134340076
9-20211126928628
8-20211789546419
7-20211855942001
6-2021671715587
  • 36862, conf, Whiting, Satterthwaite 13-7-2H, Sanish, first production, 6/21; t--; cum --;
DateOil RunsMCF Sold
10-2021108068686
9-20211171110650
8-202168533661
7-20211170
6-20211920
  • 36304, conf, Bruin, FB Belford 148-95-22D-15-10B, Eagle Nest, first production, 6/21; t--; cum --:
DateOil RunsMCF Sold
10-2021139988955
9-202137341312
8-20211356412776
7-20212914326836
6-20212502915594
  • 37416, conf,  Oasis, Wold 5397 43-34 5B,  Sand Creek, first production, 6/21; t--; cum 108K 10/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021291696116971071709694021265
BAKKEN9-20213029783297711281031329089910742
BAKKEN8-2021312554125540155176857728452730
BAKKEN7-2021312372523714350358498532553935
BAKKEN6-2021271161111611118542620025597470
  • 37381, conf,  Oasis, Wold 5397 43-34 4B, Sand Creek, first production, 6/21; t--; cum 89K 10/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021311970319707080103779721022
BAKKEN9-202130237372372713780826721297277
BAKKEN8-2021311762317622146944945422171653
BAKKEN7-2021311759417585378441023373632419
BAKKEN6-2021281062810628111302480724389298
  • 37030, conf, Whiting, KR State 13-16HU, Sanish, first production, 6/21; t--; cum 43K 10/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-20213117547174981383523014208212193
BAKKEN9-20213019334193822171421950126739277
BAKKEN8-2021643624209453517491277472
BAKKEN7-2021006210000
BAKKEN6-20212217721151231104690469
  • 36305, conf, Bruin, FB Belford 148-95-22D-15-8T, Eagle Nest, 33-025-03778, first production, 6/21; --; t--; cum 102K 10/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-20213115440154011331323138180482541
BAKKEN9-20212818805188541423826295208692202
BAKKEN8-20213119061190482327024391206332213
BAKKEN7-20213124105241363342929890260453845
BAKKEN6-20211524092237713964326627175038631
  • 36306, SI/A, Bruin, FB Belford 148-95-22D-15-7B, Eagle Nest, 33-025-03779; first production, 6/21, --; t--; cum 161K 10/21;
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN10-2021311928919241707130953243403426
BAKKEN9-2021282506325138850237416299323159
BAKKEN8-20212731726317041556939810340653654
BAKKEN7-20212950996510402614065504570778427
BAKKEN6-202118336933324437265403212648813062
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Wells Coming Off The Confidential List This Next Week -- December 12, 2021

Monday, December 20, 2021: 75 for the month, 78 for the quarter, 330 for the year:
None.

Sunday, December 19, 2021: 75 for the month, 78 for the quarter, 330 for the year:
38185, conf,  CLR, Tallahassee FIU 7-21H,
37189, conf, Whiting, Feehan 11-9HU,

Saturday, December 18, 2021: 73 for the month, 76 for the quarter, 328 for the year:
36302, conf, Bruin, FB Belford 148-95-22D-15-14B-LL,

Friday, December 17, 2021: 72 for the month, 75 for the quarter, 327 for the year:
38186, conf, CLR, Tallahassee FIU k6-21H,
36771, conf, Hess, BL-A Iverson-155-96-1312H-9,

Thursday, December 16, 2021: 70 for the month, 73 for the quarter, 325 for the year:
36303, conf, Bruin, FB Belford 148-95-22D-15-13T-LL,

Wednesday, December 15, 2021: 69 for the month, 72 for the quarter, 324 for the year:
38187, conf, CLR, Tallahassee FIU 5-21H,

Tuesday, December 14, 2021: 68 for the month, 71 for the quarter, 323 for the year:
None.

Monday, December 13, 2021: 68 for the month, 71 for the quarter, 323 for the year:
38188, conf, CLR, Tallahassee FIU 4-21HSL,
37352, conf, Oasis, Wold 5397 44-34 12TX,
36862, conf, Whiting, Satterthwaite 13-7-2H,
36304, conf, Bruin, FB Belford 148-95-22D-15-10B,

Sunday, December 12, 2021: 64 for the month, 67 for the quarter, 319 for the year:
37416, conf,  Oasis, Wold 5397 43-34 5B,
37381, conf,  Oasis, Wold 5397 43-34 4B,
37030, conf, Whiting, KR State 13-16HU,
36305, conf, Bruin, FB Belford 148-95-22D-15-8T,

Saturday, December 11, 2021: 60 for the month, 63 for the quarter, 314 for the year:
None.

Friday, December 10, 2021: 60 for the month, 63 for the quarter, 314 for the year:
36306, conf, Bruin, FB Belford 148-95-22D-15-7B,
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Notes From All Over -- December 12, 2021

More QE? Brandon, just like Donald Trump, will force Jay Powell's hand. This is absolutely fascinating. Josh Young, who initiated the tweet, is, in my mind, as credible as Tyler Durden: in other words, whether you like him or not, whether he is credible or not (think Rush Limbaugh) you have to listen to him. I think 2022 is going to be absolutely fascinating for investors, and if Josh Young is correct, it's only going to get better for investors, which seems hard to believe -- that it could get any better. The Feds are flush with cash, pulling in record amounts of revenue ("taxes") and although the debt / deficit are worsening, the debt limit was raised with nary an op-ed, and .... it's the mid-terms! But spend some time on the linked tweet and the comments it generated. Maybe one for the archives. 

EVs: tracked here / here and this morning's updates here. The latter link will take you to two of the most exciting EV developments in the past two or three days, as reported by The WSJ: Daimler Truck and a review of the Rivian R1T. From Investor's Business Daily, top five EV manufacturers, and all the rest.

Next up, the Permian: thoughts on crude oil. Again, same rabbit hole. This morning's update here. Sheffield concerned about the high price of oil; and, TTE as an investment?

Graphs: the most interesting graphic so far today. I just wish more dots would have been labeled. From The WSJ. Pay particular attention to the quadrant in which Berkshire Hathaway sits -- that corroborates my thinking regarding Warren Buffett and Charlie Munger for the past five years. Their investment strategy: buying back shares in their own company because they can't find other companies they consider more valuable then their own. Talk about falling in love with a stock. Be careful with this graph: sector III is the worst sector in which to be sitting. The best sector? Sector I. At least I think I have that right.


Covid-19:

  • record number of vaccinations being given in the US; rate of increase quite astounding, considering;
  • link here.
  • omicron: a dud? what's next?
  • the big vaccine pivot: this is an incredible story from The WSJ and provides, again, another example of how investors can do well -- or at least make rational (and I use the word loosely) decisions
    • Merck faltered coming up with its own vaccine;
    • how to respond: partner with Pfizer to make Pfizer's vaccine: wow
  • do vaccines and lock downs help? Austria thinks so. From The WSJ: "Covid-19 measures and a looming general vaccine mandate are persuading more to take the shot as Omicron spread. Time to flatten the curve, apparently, but look how long it's taking to get started:

Austria, one of the worst-hit countries in Europe’s latest Covid-19 surge, has seen infections plummet and vaccination rates soar after imposing a lockdown and saying it would make the shots mandatory next year.

The measures, and the steep fall in new cases since they were announced, could offer some options to countries in a region where infections are still rising rapidly or plateauing at a high level.

The Alpine republic introduced a lockdown and said it would mandate vaccines beginning next February, 2022, on November 22, 2021, when the weekly rolling average of daily new cases exceeded 1,500 and hospitals in areas with low vaccination rates were struggling to cope with the influx of patients.

  • From what I've read, the issue is not deaths, it's hospitalizations. If accurate, it's all about "flattening the curve." But look at that, something I missed earlier: the "mandate" was announced in November, but won't begin until next February. Probably a combination of politics, logistics, and availability of vaccine.

NFL today: I wanted to put this at the top, but the Josh Young tweet was way too important to get buried. so the "NFL Today" will have to go down here. Dallas vs the Washington Team at noon! Wow, some other great match-ups today, also.

********************************
Olivia and Soccer

FC Dallas, for whom Olivia plays, finished first in their bracket at "regionals" / "quarter-finals" / "semi-finals" in Orlando, Florida, this weekend. They just completed their third and last game. They won their first two games; I was never told how they did in the third game because it doesn't matter. We don't even know who they played! But by finishing first in their bracket, if they "do well" in the second half of this tournament to be held in Arizona in March, 2022, they go to the National tournament in June / July time frame. 

This is an interesting phenomenon. It is simply not about winning / losing games. Points are given for wins and ties; for number of goals scored; number of goals the opponent scores, etc. And at the end of the day, although the teams want to win (for obvious reasons) and especially for the coach whose reputation rests with wins/losses, these are "showcase" games for the players. College and professional scouts are looking for recruits. 

This is where it starts getting serious: tenth grade, high school sophomores. College scouts were out watching recruits as early as middle school, but now, next year, their junior year, the players will start getting "offers."  Offers include full scholarships at Ivy League schools and west coast schools like Stanford.

Olivia says she will not play soccer in college; it's all about academics. But, once it sinks in that NCAA athletes are allowed to "cash in" and still maintain amateur status, she may re-think. LOL. 

s/A bragging grandfather.

**********************************
Corky

By the way, Corky is back from vacation and joined us for sushi last night.

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