The Road To New England -- Running Out Of Natural Gas -- December 26, 2022

It's tedious to post this, but it's for the archives.

I don't recall seeing this before this year: natural gas dropping to third place in ISONE. 

 Elsewhere, on social media:

Updating Enerplus' "Heavy Metal Pad, #2" -- So Much Work Left To Be Done In The Bakken -- December 26, 2022

The Enerplus "Heavy Metal Pad, #2" is tracked here. This page will not be updated. These wells are tracked at the link.

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The Update

The initial production: see below the graphics, but look at this one -- 166K in four months; at $70/bbl = $12 million at the wellhead; "gold standard" for well completion costs in the Bakken these days: $6 million. 

• 37894, loc/A, Enerplus, Osmium 147-93-17B-20H, Moccasin Creek, t--; cum 166K 10/22;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2022	30	27305	27362	26726	26246	23655	314
BAKKEN	9-2022	30	24127	24128	31238	21349	18657	680
BAKKEN	8-2022	28	33614	33497	36936	26912	23414	863
BAKKEN	7-2022	28	56799	56883	53598	40305	36022	280
BAKKEN	6-2022	10	23672	23287	31849	17182	14375	2090

This is what the pad looks like today.

Initial production data:

The wells:

• 37890, conf, Enerplus, Bismuth 147-93-17B-20H, Moccasin Creek, t--; cum --;
  

Date	Oil Runs	MCF Sold
10-2022	31431	23195
9-2022	39263	30000
8-2022	43614	32829
7-2022	26464	23075
6-2022	8710	5377

• 37891, conf, Enerplus, Cadmium 147-93-17B-20H, Moccasin Creek, t--; cum --; 

Date	Oil Runs	MCF Sold
10-2022	20303	12973
9-2022	1212	732
8-2022	4537	2733
7-2022	2930	1456
6-2022	212	131

• 37892, loc/A, Enerplus, Brass 147-93-17B-20H, Moccasin Creek, t--; cum 116K 10/22;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2022	27	23334	23363	22912	21621	19504	259
BAKKEN	9-2022	29	31328	31324	28429	28153	24697	900
BAKKEN	8-2022	23	24421	24336	27382	20319	17928	661
BAKKEN	7-2022	18	25351	25390	23645	18466	16831	131
BAKKEN	6-2022	6	11151	10970	17623	7987	6772	1016

• 37893, loc/A, Enerplus, Tin 147-93-17B-20H, Moccasin Creek, t--; cum 125K 10/22;

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2022	29	22811	22840	27797	19368	17273	229
BAKKEN	9-2022	29	26690	26688	28962	22441	19542	712
BAKKEN	8-2022	27	30006	29902	37274	26719	23471	865
BAKKEN	7-2022	28	34958	34994	46746	34930	32237	251
BAKKEN	6-2022	6	10412	10243	19565	7765	6323	1193

• 37894, loc/A, Enerplus, Osmium 147-93-17B-20H, Moccasin Creek, t--; cum 166K 10/22;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2022	30	27305	27362	26726	26246	23655	314
BAKKEN	9-2022	30	24127	24128	31238	21349	18657	680
BAKKEN	8-2022	28	33614	33497	36936	26912	23414	863
BAKKEN	7-2022	28	56799	56883	53598	40305	36022	280
BAKKEN	6-2022	10	23672	23287	31849	17182	14375	2090

• 37895, loc/A, Enerplus, Gallium 147-93-17A-20H, Moccasin Creek, t--; cum 113K 10/22;
  

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	10-2022	27	17934	17976	29790	16793	15169	201
BAKKEN	9-2022	30	19430	19430	30938	19692	17455	636
BAKKEN	8-2022	28	24828	24742	39523	18898	16451	606
BAKKEN	7-2022	26	33516	33577	56709	29266	26647	207
BAKKEN	6-2022	10	17501	17217	36335	13121	10628	1826

Additional graphics:

Update: COP's Giant Willow Oil Field, North Slope, Alaska -- December 26, 2022

Before we get started: who needs this oil? Which US state most needs this oil? That may be the thumb on the "decision" scale.  

And, before we get started, globally, is it coming down to this for three US giants?

• XOM: Guyana
• CVX: Venezuela
• COP: Alaska

Alaska oil future is tracked here.

COP's Alaskan projects: link here.

• Willow oil field
• project planning has spanned five presidential administrations

On the radar scope: COP's giant Willow oil field.

• 600 million bbls over ten years
• only three or four summer months each year to build
• timeline:
• Biden administration promises to have:
• final environmental report released by the end of February, 2023;
• final decision by end of March, 2023:
• three options:
• deny entire project;
• grant approval for two pads;
• approve entire project.

COP: says it won't settle for anything less than full approval; a two-pad approval is not economic according to COP

My hunch:

• Biden will thread the needle and gain max political leverage by approving two pads;
• if COP won't accept, then COP gets the blame; Biden can say he approved the project;

Comments that will affect the outcome:

• Comment: after killing the Keystone XL, if Biden is seen as killing yet another project ...
• Comment: Biden's official energy program -- "no more drilling"
• Comment: the project has bipartisan support in Alaska
  
• Comment: could delay decision long enough to make construction "moot" this year; if so, there's no reason why Biden couldn't delay decision until well late into 2023 or 2024
• a delay of the decision would allow Biden and COP to continue negotiating;

For investors: if approved, it's going to be a huge drag on earnings short term.

More background data, from the EIA, April 26, 2021: 

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Binge Television

The "Jason Bourne" franchise.

I think there's only one of the five I haven't watched more than once.

I was surprised to find myself enjoying The Bourne Legacy as much I as I did considering this is one of the five in which Matt Damon did not appear. It may be my favorite of the five. The cinematography is spectacular and the story line pulls the Jason Bourne story together.

********************
Amazon Prime Video

The Sound of 007: Live From The Royal Albert Hall

Most enjoyable, Paloma Faith.

Cinematography outstanding. 

A keeper. 

Also on Amazon Prime Video:

From wiki:

Paloma Faith Blomfield was born in the Hackney area of London on 21 July 1981,  the daughter of an English mother and Spanish father. Both of her parents were raised in Norfolk.

Her parents separated when she was two years old and divorced two years later. She was raised by her mother in Stoke Newington, although she maintains a close relationship with her paternal grandmother.

As a child, she took ballet classes in Dalston. After completing her A-levels at City and Islington College, she went on to study for a degree in contemporary dance at the Northern School of Contemporary Dance in Leeds, while working as a hip-hop dancer at the nightclub LoveDough.

She then studied for an MA in theatre directing at Central Saint Martins College of Art and Design and took various part-time jobs as a sales assistant at Agent Provocateur, a singer in a burlesque cabaret, a bartender, a life model, and a magician's assistant.

Faith's first foray into music began when she mimicked famous soul and jazz singers including Etta James and Billie Holiday, whom she admires and cites as influences for her own work.

She met her managers Jamie Binns and Christian Wåhlberg of Lateral Management in 2007.

Binns had been tipped off by the producer Peanut, a client who had recently worked with Faith in his studio and been impressed.

He met up with Faith shortly afterwards and was "completely blown away", later saying, "I wasn't sure what this girl was going to do – she was an actress and a singer – but there was just something about her in that artistic realness that when I came out of the meeting I called Christian and said, 'We have to do something with this girl!'"

During her time at college, Faith worked in a pub where the manager asked her to front his band, which they later called Paloma and the Penetrators.

During a performance with the band at a cabaret show, she was scouted by an A&R man from Epic Records, who invited her to sing for the manager of the label.

Twenty minutes into the audition, she asked the manager to turn his phone off; when he refused, she walked out.

The manager later called her and offered her a contract, claiming that he had seen many acts since their meeting but none had been as memorable as her.

She turned down an opportunity to join Amy Winehouse's band in order to write and perform her own songs.

Her first recognised work was the song "It's Christmas (and I Hate You)," which she recorded as a duet with Josh Weller in 2008.

Paloma Faith and Josh Weller

Predictions For 2023 -- IN PROGRESS

Others: link here.

Mine, in progress, not ranked in any particular order:

• Energy remains the top global news story; coal talk overwhelms "global warming" talk 
• New England needs to re-think their energy policy; they won't
  
• EV manufacturers will experience a "come-to-Jesus" moment; challenges for Tesla may be insurmountable;
• there will be a relative glut of new cars by mid-summer as supply chain obstacles are resolved, and floodgate of 2023 cars released as well as beginning surge of EV
• EVs will disappoint; consumers can't afford; recession-like economy for 1H23
  
• WTI trends toward $90, but won't go over $100;
  
• no major military action in the Pacific; in eastern Europe; in the Mideast; or on the Korean peninsula; another year of peace; Ukraine war will end in unstable truce
  
• Covid-19 fades away; except in China
  
• the Bakken "maintains"; 
• active rigs trend toward 50; production returns to 1.2 million bopd;
• Fed will remain hawkish
• NFL has best year in history; NBA not so much
• Dallas Cowboys will past first round but won't make it to the Super Bowl
  
• the milliondollarway blog will be better than ever

The one "issue" that completely confounds me: how much crude oil the US will have in storage measured in "number of days" through 2023.

• if week-after-week, number of days of crude oil supply stays above 30 days, the "availability of oil" is a non-issue.;
• if "we" stay between 22 days and 28 days, moving around an average of 26 days, plus or minus a couple of days, it's pretty much the same thing -- a yawner;
• but if we get to 24 days and the trend is definitely downward, one would expect crude oil prices (and gasoline prices) to start going higher; 
• for me the "breaking point" is 20 days AND a consistent downward trend, week-after-week; 
• a second aspect of all this correlates with this maxim: the price of oil is not determined by the average price of all oil available, but the price of the last bbl being sold, if that makes sense -- the corollary? Once we hit go below a certain number of days of crude oil in storage, the price of oil won't move linearly with the drop in the number of days of oil storage. The price of oil will surge, not week/week, but day/day. Imagine walking toward the edge of a cliff .... that last step is not like the penultimate step before going over the edge ...  
• days of supply is incredibly complicated:
• first of all, it's a prediction
• second, large number of variables, each of which by itself, can be incredibly difficult to predict
• completely unpredictable geopolitical events can have huge effects
• policy decisions by oil-producing countries can have huge effects, and some policy decisions can result in unintended consequences (e.g., Biden's decision to release oil from the SPR)
• all one can do is pull out a yellow legal-size piece of paper, draw a line down the middle and put supply issues on one side and demand issues on the other other side (the most recent, perhaps best example -- the announcement by Mexico that as of 2023, that country will no longer export any of its oil

Top Stories For 2022 -- IN PROGRESS

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Top Stories of 2022
By Category

Top Story Of The Year:

• Coal is the transition fuel
• irony: Germany's pivot to coal changes the dynamic
• it's not "okay" for China, India, others to turn to coal
  
• SPR release prior to midterm elections; record release; trending toward $5-gasoline; 
• US LNG export projects have made over 20 supply deals since June
  
• Almost a full year of war in Ukraine and no end in sight
• China "opens" at end of the year; will pivot to herd immunity
• Crypto crushed
  

Runner-up story of the year:

• Recession talk continues; US equity markets in bear territory
• Covid-19 in the US, as a top story, quietly goes away
• Southwest Airlines collapse during Christmas holidays; extended into New Year's
  

The Biden administration:

• Southern surge: a non-story:
• Official energy policy: no more drilling
• Three huge bills passed
• Infrastructure, make America great again (IRA)
  
• Tech ("Chips" bill)
  
• Spending
  

The world:

• China: Covid-19 disaster
• Millions to become infected;
  

Most surprising story of 2021:

• Coal is the transition fuel

The most egregious story to come out of the Bakken:

The "best call" by the blog: 

• Devon
  

The most frustrating story to come out of the Bakken: 

• Winter storms greatly affect production
• Spring, 2022
• Autumn, 2022
  

The top US story:

• Biden doing surprisingly well.
• Huge spending bill passed
• Three major bills passed
• no "red wave"
• in off-year election, POTUS' party holds the US Senate
• barely took control of the US House
  

North Dakota, energy:

• Harold Hamm takes CLR private
• Whiting - Oasis merge: Chord
  

North Dakota economy:

• 
  

North Dakota technology:

• 
  

Most exciting non-operator in the Bakken:

• NOG, as usual
  

Most exciting micro operator in the Bakken:

Most exciting small operator in the Bakken:

• 
  

Most exciting medium-size operator in the Bakken:

• Enerplus
  

Most exciting large operator in the Bakken:

• CLR
  

Most aggressive large operator in the Bakken:

• CLR

Biggest deals:

• Whiting - Oasis merge: Chord
  

Most surprising deal:

• Whiting - Oasis merge: Chord
• CLR: is taken private
  

Record price per Bakken mineral acre, 2022 (quarterly lease sales):

•  
  

Bakken operations, rigs:

• Trended toward forty-five active rigs; plateaued at 45 rigs
  

Bakken operations, production:

• Maintains third place in US but with a third of the rigs New Mexico (the #2 state) requires
  

Bakken operations, density:

• 
  

Top prediction made in 2022 for 2023:

• EVs will destroy a lot of investors, severely harm several manufacturers (unchanged from last year)
  

Record initial production:

Biggest story in takeaway capacity:

• Freeport LNG taken off line; huge drop in price of natural gas
  

CBR:

• Non-story in 2022

Pipeline:

• 
  

Fracking:

• 
  

Flaring:

• 
  

Natural gas:

• Bakken continues to set production records, month-after-month;
• 
  

Refining:

• 
  

Investment story of the year:

• Crypto crushed
• Historic Fed rate increases; much faster than expected
  

The "other" Williston Basin formations:

• Nothing.
  

Bakken economy:

New (or better-understood) oil patch jargon:

• 
  

Miscellaneous:

Bakken economy -- Williston Economic Development (WED) top ten stories: