Fourteen (14) New Permits -- The Williston Basin, North Dakota, USA; Active Rigs At 178 Ties Record Low

Active rigs: 178 (ties record for LOW number of active rigs post-boom in the Bakken)

Fourteen (14) new permits --

• Operators: Newfield (7), MRO (4), Whiting (2), Corinthian Exploration
• Fields: Reunion Bay (Mountrail), Sanish (Mountrail), Sioux (McKenzie), Siverston (McKenzie), Westberg (McKenzie), Souris (Bottineau)
• Comments: Newfield has permits for five Wisness wells on one pad; two wells on another pad; there are already three other Wisness wells in section 21 (two Petro-Hunt wells; one Newfield well)

Wells coming off the confidential list were posted earlier; see sidebar at the right.

It looks like 22 permits were renewed, which is about as many as I've ever seen for one day.

Hess cancelled a well:

• 19852, PNC, Hess, EN-Kiesel-155-94-1918H-3, Manitou

Number Of Active Rigs In North Dakota Ties Post-Boom Record LOW

The number of active rigs is down to 178 in North Dakota. That ties the post-boom record for low number of active rigs. (Early in the week I had suggested 179 was the record low; I see I was wrong based on the data in the sidebar at the right.)

Huge Story Is Actually Bigger Than Most Folks Realize

Back in early June, 2013, NDIC was predicting that North Dakota would hit 850,000 bopd by the end of the year. A link at that post will take you to this site in which that prediction was clearly stated:

Oil production from North Dakota's Bakken shale hit a new high in April and could exceed the state's forecast of 850,000 barrels per day by the end of the year, state regulators said on Friday.  -- June 14, 2013.

North Dakota blew through 850,000 bopd at the end of July, 2013, hitting almost 875,000 bopd, easily surpassign the 850,000 bopd number and doing it five months early.

I said at the time: I think the state will hit 850,000 bopd by the end of August (remember: reporting lags two months, so we won't see that figure reported until Halloween). 

The roughnecks and the frack teams beat that by a month. 

What I find most amazing is this: the prediction that we would hit 850,000 bopd by the end of the year was made just a couple of months ago; another indication how fast things are moving.

Again, Lynn Helms stated very clearly in early 2013, that we would be seeing some huge initial production numbers in the summer, 2013. He was very, very accurate.

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On another note: this is nice to see. My data base says there were 276 new oil and gas permits issued in August, 2013. How many did the state say there were? 276. Whoo-ah!

How many for the month of September, as of September 12, 2013? 113.

Director's Cut Is Out: Production Surges By 6.4% Over Previous Month; Completions More Than Double Month-Over-Month; Frack Crews Outpacing Drilling For First Time In Bakken History

A huge round of applause to the roughnecks and the frack teams. 

Production:

• June: 821,598 bopd
• July: 874,460 bopd (new all-time record)

A 6.43% increase.  This is the biggest percentage increase in almost two years (maybe longer; that's only as far back as I've tracked) and we're in the maintenance phase of drilling; the boom is over. Or so they say.

This is where I track future production, just for the fun of it. 

Producing wells:

• June producing wells: 9,096
• July producing wells: 9,322 (new all-time record)

Wow, look at the permitting:

• June permitting: 165
• July permitting: 179
• August permitting: 276 (all time high was 370 in October, 2012)

Pricing

• June: $86
• July: $96
• August: $94

From the narrative:

"The drilling rig count decreased slightly from June to July, but the number of well completions jumped 102 to 251, resulting in a 6.4% increase in oil production. That number of completions is almost three (3) times the threshold needed to maintain production."

"Completion crews outpaced drilling rigs for the first time this year."

"The average number of days to drill a well from spud to total depth remained steady at about 22, but the average number of days from total depth to initial production fell from 94 to 79."

Now you know why raw number of rigs is not all that significant. The rig count actually fell, but completions jumped from 102 in June to 251 in July. 

My vote: pay roughnecks for a full year of work, but drill and frack in North Dakota for only the best eight (8) months of the year.

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Flaring

Naysayers will argue; they will disagree. I would prefer that naysayers not read this part of the post.

From the narrative:

"The percentage of gas flared is back up 2% to 30% almost all of which can be attributed to processing plant outages for mechanical repairs and electrical failures."

How many story lines can one find in that one sentence?

• well completions more than double, and there's hardly an increase in flaring
• crude oil production surges by 6.43% month-over-mont, and there's hardly an increase in flaring
• flaring is still incredibly low compared to the high in 2011, when oil production was much lower
• pundits will continue to say one-third of natural gas is flared in North Dakota, which is untrue
• the slight rise in flared natural gas was not due to pace of drilling or completion activity
• almost the entire increase, though minimal, was due to processing plant issues
• infrastructure is improving
• operators are drilling/completing wells where natural gas lines exist
• operators have defined the limits and sweet spots of the Bakken
• operators are defining the limits and sweet spots of the Three Forks
• almost all acreage is now held by production; there is no urgency to place wells where it does not make sense
• almost all acreage is now held by production; there is no urgency to place wells where there are no natural gas gathering systems
• folks over at the TR&E board will now see that operators are less likely to drill on their acreage if natural gas processing systems are not in place
• electrical failures? this to me suggests issues with the grid; and that brings me back to the additional transmission lines that need to be put in place, including the one going through the Killdeer Mountains

With regard to natural gas production:

• June: 28 million cubic feet
• July: 30 million cubic feet
• Increase in natural gas production, month-over-month: 7.41%
• 21 million cubic feet sold (assuming 70% of production was sold; 30% was flared)

According to The Director's Cut: $3.09/MCF = $3,090/million cubic feet x 21 million thousand = $65,000,000 of natural gas sold. Folks can check the math; I generally make a lot of simple math errors.

On the other hand, 27 million bbls of crude oil was sold for almost $100/bbl = $2.7 billion.

If 9 million MCF was flared, that means about $30 million flared.

As I've said before, I can't get my arms around these numbers. So, let's drop some of the zeroes. $2.7 million in crude oil; $30,000 in natural gas. $30,000 in crude oil; $30 in natural gas. I'm sure the math is off but that's good enough for me. It helps put things into perspective.

Romney, Bain, Global Warming -- What Do They Have In Common? Inconvenient Truths (And The Stories Will Annoy The Mainstream Media)

In fact, the mainstream media is not even mentioning them. One finds these stories buried in the blogs written by some folks not meeting the Senate definition of "journalists."

The Daily Caller is posting:

“The very wealthiest Americans earned more than 19 percent of the country’s household income last year — their biggest share since 1928, the year before the stock market crash,” the Associated Press reports. ”The top 10 percent captured a record 48.2 percent of total earnings last year … [and] in 2012, the incomes of the top 1 percent rose nearly 20 percent compared with a 1 percent increase for the remaining 99 percent.”

To keep the success rolling, the administration taps a former Romney/Bain exec to be the President O'Bama's new top economic deputy:

President Barack Obama’s new top economic deputy is a former management consultant who worked for Gov. Mitt Romney’s Bain & Company investment firm.

The appointment of Jeff Zients as head of the National Economic Council is likely to annoy some union officials and some liberal groups who are focused on declining working-class wages and growing poverty, and it clashes with the populist anti-business invective used by Obama and his aides on the 2012 campaign trail to paint Romney as uncaring.

"Likely to annoy some .... "

Wow, that's an understatement.

By the way, speaking of annoying some folks, what is IceAgeNow talking about these days? From yesterday:

No doubt about it. The Earth’s climate is cooling!

One of the most prescient indicators clearly shows it, namely the Danish Meteorological Institute’s daily mean temperatures for the Arctic area north of the 80th northern parallel. They have been measured for over 50 years which shows a long-term average of 90 days with the air temperature above freezing.

The year 2013 has seen a dramatic departure from that routine. In 2013, the summer (above freezing temperatures) lasted for only 45 days, one half of the average number of days. Not only did the frost-free days start much later than on average this year, they also ended much earlier, see the figure below. In fact, the frost-free period seen this year was significantly shorter than in other year since 1958, when the recordings began.