Wednesday, October 10, 2012

New Refinery in North Dakota? File Under: Why There's No Growth in the US -- A Decade To Get a Permit

Okay, maybe nine years. Whatever.

Link to Bismarck Tribune here. 
The Three Affiliated Tribes announced Wednesday that it has been given permit approval to take control of a piece of reservation land to build an oil refinery.

U.S. Secretary of the Interior Ken Salazar joined with tribal leaders at tribal headquarters to announce the permit approval, which brings a refinery one step closer to reality.
Nine years ago the tribe had requested that the Bureau of Indian Affairs, a part of the Department of the Interior, accept the acreage into a trust. The trust will allow the Interior department to own the land while allowing the tribe to control and manage it.
The tribe has wanted to use a 469-acre piece of land near Makoti to build the refinery and produce feed for the tribe’s buffalo herd. Plans call for the refinery to be built on a 190-acre portion of the land. The other land will be used for the buffalo.
The permitting process, which was nearly a decade in the making, opens the door for the construction of a new refinery in more than 30 years.
SecInterior Ken Salazar sounded jubilant in the news story; he should have been dismayed that it took nine years to get a permit.

Data points:
  • MHA Nation Clean Fuels Refinery
  • $400 million refinery
  • capacity of 13,000 bbls/day
  • Bakken oil --> diesel, gasoline, propane (I still don't see the "clean fuels" aspect of this, yet)
  • refinery site: along US Highway 23, on the edge of the Fort Berthold Indian Reservation
  • 800 to 1,000 jobs during construction phase
  • about 140 permanent jobs
  • nine years to get the permit

File Under: I Can't Make This Stuff Up

A little humor for the day:
US Rep. Henry A. Waxman (D-Calif.), the House Energy and Commerce Committee’s ranking minority member, has asked the US Federal Trade Commission to investigate a gasoline price surge in the Golden State.
“Over the past week, retail gasoline prices in California have soared by more than 50¢/gal to a record price of $4.67/gal,” Waxman said in an Oct. 9 letter FTC Chairman Jon Leibowitz.
“There has been no similar surge in gasoline prices nationwide.”
Waxman noted that the most common explanation is that a series of refinery accidents and temporary shutdowns have created a California supply crunch. US Energy Information Administration data show that West Coast gasoline inventories are “unusually low for this time of year—at the lower edge of the 5-year range,” he added.
And, of course, regular readers already know which video comes up next.
I'm Shocked, Shocked, Casablanca
"Soared by 50 cents/gallon to a record $4.67/gallon" -- so, I guess, $4.17 isn't so bad?

Before the increase, a 20-gallon SUV fill up cost: $83.40. After the increase: $93.40. Ten bucks on a $90 purchase. Pales in comparison to what California taxes will be after the November election. 

Something tells me Mr Waxman is getting a lot of mail from his constituents.

I wonder who will pay for this "investigation"?

Twenty-eight (28) New Permits; KOG, BEXP With Two Huge Wells;


Other Energy Links

RBN Energy: process for laying new NGL pipeline systems

Bakken Operations

Active rigs: 187, down 2 from yesterday

Twenty-eight (28) new permits
  • Operators: BEXP (10),  Denbury (5), Marathon (4), Samson Resources (3), Oasis (2), Whiting (2), XTO, Liberty Resources,
  • Fields: Sanish (Mountrail), Ray (Williams), Murphy Creek (Dunn), Heart Butte (Dunn), Banks (McKenzie), Bailey (Dunn), Werner (Dunn), Glass Bluff (McKenzie), Cedar Coulee (Dunn), Ambrose (Divide), North Tobacco Garden (McKenzie), Bicentennial (Golden Valley)
  • Comments: No new permits for Newfield or OXY USA
Producing wells now completed:
  • 21308, 2,461, KOG, Koala 14-32-29-3H, middle Bakken, Poe, t9/12; cum 71K 11/12; 28 stages; 4 million lbs ceramic; see pad diagram below
  • 22023, 3,079, BEXP, Bill 14-23 1H, Alexander, t8/12; cum 23K 8/12;
Two wells coming off the confidential list tomorrow:
  • 21251, 465, Whiting, Cymbaluk 21-25TFH, Wildcat, about 2K per month; located in Park oil field, in southwest North Dakota; t4/12; cum 15K 8/12;
  • 21569, 723, CLR, Mittlestadt 2-20H, Chimney Butte, t7/12; cum 33K 8/12;
From the well file, a schematic of the pad where oil from three KOG wells will be commingled. These pads have to be quite impressive:

701,134 BOPD; Represents Almost Four (4) Percent Increase

https://www.dmr.nd.gov/oilgas/mpr/2012_08.pdf

Aug numbers are out: 701,134 bbl s per day.

CarpeDiem.com does a better job than I describing the significance of all this.

August production: 21,735,166 bbls / 31 --> 701,134 bopd
July production: 20,963,713 bbls / 31 --> 676,249 bopd


701,134 - 676,249 = 24,885 bbls / 676,249 --> 3.68% increase

7,701 producing wells -- 91 bbls/day

What surprises me the most? From CarpeDiem.com: North Dakota produced 73% more oil than Alaska in August. That's pretty impressive.

Incredible Story Coming Out of California: Results Of The Year-Long Fracking Study Is Released

Updates

October 12, 2012: same story from Oil and Gas Journal. 
A study commissioned by Plains Exploration & Production Co. concluded hydraulic fracturing of two test wells at Inglewood oil field in Los Angeles County, Calif., indicated no detectable evidence that it might induce earthquakes or have negative consequences on groundwater quality, a consultant reported.
Carno Entrix of Los Angeles conducted the study, and the California Department of Conservation posted the study on its web site.
California is expected to release a draft of fracing rules soon. Don Drysdale, spokesman with the Department of Conservation, told OGJ that it will be “several weeks” before a draft is issued.
So, we await the "California" rules. Can hardly wait.

Original Post

As you read the story below, note that this story is coming out of California. The governor of New York needs to read this study. One can only imagine all the "politically-correct" talk that must have emanated from the study team prior to releasing their findings.

A huge thank you to a reader for alerting me to this story. I had not seen it yet, and I scan the LA Times several times during the day.

http://www.latimes.com/news/local/la-me-fracking-baldwin-hills-20121010,0,5707434.story

I generally don't "cut and paste" so much from a story, but this is a huge story, and if the story at the source is archived, I want to be able to see the story twenty years from now.
A long-awaited study released Wednesday says the controversial oil extraction method known as hydraulic fracturing, or fracking, would not harm the environment if used at the Inglewood Oil Field in the Baldwin Hills area.
The yearlong study included several issues raised by residents living around the field, such as the potential risks for groundwater contamination, air pollution and increased seismic activity. For months, water wells on the 1,200-acre field were monitored.
Data from ground and air monitors were collected and analyzed, but no effects were recorded before or after the technique was used, the study says.
"There were eight contributing studies addressing such things as vibrations at the surface, microseismic activity at depth, noise, ground movement measurements, subsidence, groundwater quality, methane in both soil and groundwater," said Dan Tormey, technical director and principal at Cardno Entrix, the environmental consulting firm that conducted the study.
"Each was a study that contributed to the [overall] hydraulic fracturing study." Plains Exploration and Production Co., the owner and operator of the oil field, paid for the review as part of a settlement agreement with Culver City and environmental and community groups.
The report was reviewed by two independent firms selected by the company and Los Angeles County. The 206-page study is the first of its kind in the state. It comes at a time when environmental and community groups are urging lawmakers to ban fracking, a technique that fractures rock formations to release trapped oil and natural gas. The process involves a high-pressure injection of water, sand and chemical additives into the drill site's wellbore.
Please go to the linked story to get the rest of the details.

Now, we await the comments from those suggesting the study was flawed. And, oh, by the way, who is Cardno Entrix?  Who funds them? Who is on the Board of Directors? What experience do they have in fracking? Did they study enough wells? Did they hold any meetings in Las Vegas? Was Al Gore invited to present opposing data? Did they consider the life-time carbon footprint from planning to production to shipment to consumer use of fossil fuel facilitated by fracking? Did they consider the impact on endangered species in downtown Los Angeles?

Seriously, it should be noted the number of studies done and the number of wells tested in this California study, compared to the two wells, and then one well, tested by the EPA in Wyoming (see "shenanigans in Wyoming").