Peak Oil? What Peak Oil? Additional Data Points Regarding The Permian -- Rosetta Resources

Updates

October 4, 2013: two things -- a reader sent me a note suggesting the Bakken numbers could be much, much bigger than what I posted below. I agree. I was concerned with even posting the numbers below, much less even bigger numbers. I am very serious about the Bakken posts (the non-Bakken posts are often hyperbole and venting). I don't need to exaggerate regarding the Bakken, so I tend to hold back on what I'm really thinking.

Another reader sent me the PDF link to Mr Rolfstad's newest presentation on the Bakken. Readers may want to note the number of wells that folks are now talking about.

Original Post

SeekingAlpha is reporting:

While at the first glance the 40,000-acre position may appear modest in size, one should keep in mind that even under the conservative 40-acre development scenario, it would take over a decade to complete the drilling with a six-rig program, assuming current drilling pace of ~16 wells per rig-year. One would need to double the timeframe if the development proved to be feasible on 20-acre spacing.

Most importantly, Rosetta estimates that on its entire position in Reeves County, it has over 100 million barrels of oil equivalent in place per section (one square mile). The estimate is truly staggering. To put it in perspective, if only 10% of total oil and gas originally in place could be recovered, gross revenue from each square mile could exceed $600 million over the life of the property (using $90 per barrel oil price realization and $5/MMBtu "wet" gas price realization and assuming reserve mix of 67% oil and 33% gas). By comparison, in its current estimates, Rosetta assumes average recovery factor of approximately 3.8%.

Don, who sent me the link, asks rhetorically: whatever happened to "peak oil"? Oh, yeah -- horizontal drilling and fracking. 

In the best Bakken, 14 wells x 500,000 bbls EUR / 1280-acre units = 7 million bbls/1280-acre units or 3.5 million bbls/section. Of course, in the best Bakken, EOG is suggesting as many as 34 wells in one 1280-acre unit.

In the Permian, in the linked article above, 100 million bbls OOIP/section x 10% recovery = 10 million bbls/section.

So, some idea of the amount of oil that could be produced in these plays.

First Unit Train Set To Roll From Western Canada

Rigzone is reporting:

The terminal in Bruderheim, Alberta, which will be expanded to 100,000 bpd by the second half of next year as a second supply pipeline is connected, initially will load only "dilbit" oil, or heavy bitumen crude from Canada's oil sands region mixed with 30 percent light condensate, Gary Kubera, chief executive of privately owned Canexus, said in an interview.

The facility is the first of a half dozen or so Canadian projects that have emerged over the past year to help carry more of the booming production from the Alberta oil sands by rail as producers seek alternatives to congested export pipelines. Shipping by rail is more costly, but also more flexible.

At present, the oil sands are only served by manifest trains hauling smaller loads, a less cost-effective mode of transport, but around 550,000 bpd of unit-train crude-by-rail projects - terminals that can load up to 120 rail cars a day - are due to start up in Western Canada by the end of 2014.

The Canexus terminal, which has been shipping 25,000 to 30,000 bpd of crude from Bruderheim on manifest trains since 2012, has already secured customer commitments for about 35 percent of its capacity. The company expects 70 to 80 percent of capacity to be under contract by the end of the year.

"The first unit train is set to run by the end of November," according to Kubera.

Twelve (12) New Permits -- The Williston Basin, North Dakota, USA; Statoil With Two Huge Wells; A CLR Charlotte Well Comes In Nicely; EOG With A Huge Hawkeye Well; Zenergy With A Huge Slagel Well

Active rigs: 185

Twelve (12) new permits -- 

Operators: XTO (4), Statoil (3), OXY USA (2), SM Energy (2), Whiting,
Fields: Fayette (Dunn), Siverston (McKenzie), Lonesome (McKenzie), Alger (Mountrail), Ragged Butte (McKenzie), Poe (McKenzie)
Comments:

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

Three (3) producing wells were completed:

• 23608, 1,303, CLR, Charlotte 5-22H, Banks, 4 sections, t6/13; cum 41K 8/13;
• 23946, 2,747, Statoil, Sanders 34-27 2H, Ragged Butte, t9/13; cum --
• 24085, 3,243, Statoil, Sax 25-36 3H, Banks, t9/13; cum --

Well Name Change:

• 25077, the Martell 36-35H2 is now a Three Forks well -- Martell 36-25HTF2; Glass Bluff 

Wells Coming Off The Confidential List Friday

• 24337, 2,519, EOG, Hawkeye 3-2413H, Antelope, middle Bakken, 28 stages; 9.7 million lbs sand; 133K in less than four months; t5/13; cum 88K 8/13;
• 24362, drl, Statoil, Knight 35-26 4H, Banks, no production data,
• 24702, 3,000, Zenergy, Slagle 12-1HST, Camp, middle Bakken; 32 stages; 3.3 million lbs; t7/13; cum 41K 8/13;
• 24738, drl, HRC, Fort Berthold 152-94-15B-22-6H, Antelope, no production data,
• 24981, drl, BR, CCU Four Aces 44-21TFH, Corral Creek, no production data,
• 24991, drl, BR, Cleo 31-1TFH, Croff, no production data,

*******************************

24337, see above, EOG, Hawkeye 3-2413H, Antelope:

Date	Oil Runs	MCF Sold
8-2013	46421	0
7-2013	49130	0
6-2013	23709	0
5-2013	13379	0

24702, see above, Zenergy, Slagle 12-1HST, Camp:

Date	Oil Runs	MCF Sold
8-2013	30428	29717
7-2013	9506	0

EOG's Hawkeye Wells; Note The Extended Long Laterals First Started Showing Up January, 2013

Location: 10010HAWKEYE.

 

Hawkeye Oil Field Wells
This Page Started Out As Hawkeye wells, regardless of oil field, but now this page tracks the Hawkeye oil field.

Updates

October 28, 2016: ten Hawkeye oil field permits were renewed today. 

Permits

2017 (none as of August 31, 2017)

2016
32745, PNC, Hess, HA-Grimestad ..
32744, 1,947, Hess, HA-Grimestad
32743, 1,723, Hess, HA-Grimestad
32742, 1,996, Hess, HA-Grimestad-152-95-3031H-8, t5/17; cum 206K 8/19;
32741, 397 Hess, HA-Grimestad
32682, 1,143, Hess, HA-Link
32681, 912, Hess, HA-Link
32680, 1,205, Hess, HA-Link
324465, PNC, Hess, HA-State ..

2015 Permits
31933, 1,155, Hess, HA-Grimestad
31932, 1,232, Hess, HA-Grimestad
31931, 1,343, Hess, HA-Grimestad
31930, 630, Hess, HA-Grimestad-152-95-3031H-4; t7/16; cum 184K 9/19;
31766,
31765,
31764,
31763,
31762,
31761,
31647,
31646,
31560,
31559,
31558,
31557,
31556, 319, Hess, HA-Chapin-152-95-2932H-6; t3/16; cum 169K 9/19;

2014 Permits
29409,
28763, 1,492, Hess, HA-Thompson-152-95-1720H-10, t6/15; cum 206K 9/19;
28762,
28761,
28760,
28487,
28486,
28485,
28484,
28483,
28142,
28141,
28140,
27815,
27801,
27800,
27799,
27693,
27580,
27579,
27578,
27472, 1,370, Hess, HA-Thompson-LW 152-95-2017H-1, t11/14; cum 292K 9/19;

2013 Permits
27025,
27024,
27023,
27022, 1,279, Hess, HA-Nelson A-152-95-3427H-5; t9/14; cum 222K 9/19;
27021,
26983,
26982,
26981,
26980,
26840,
26787,
26786,
26785,
26664,
26663,
26662,
26380, 1,371, Hess, HA-Chapin-LE-152-95-3229H-1, t5/14; cum 297K 9/19;
26013,
26012,
26011,
25867,
25866,
25865,
25146,
25145, 1,053, Hess, HA-Mogen-152-95-0508H-5, t12/13; cum 339K 9/19;
25144,
24726,
24725,
26928,
26927,
26600, 1,764, BR, Sequoia 24-9TFH, t8/14; cum 256K 9/19;
26599,
26598,
26170,
26169,
26168,
26167, 2,044, BR, Crater Lake 21-14MBH, t3/14; cum 325K 9/19;
26144,
26143,
25161,
24898, PNC, BR, Badlands 11-15TFH,

2012 Permits
24641, 680, Hess, HA-Nelson 152-95-3328H-5, Hawkeye, t9/13; cum 159K 9/19; intermittent production;

24640, 1,381, Hess, HA-Nelson 152-95-3328H-4, Hawkeye, t9/13; cum 276K 9/19;
24629, 2,949, BR, Badlands 31-15TFH, Hawkeye, t8/13; cum 148K 9/19;
24628, 2,971, BR, Badlands, 21-15MBH, Hawkeye, t8/13; cum 190K 9/19;
24627, 2,982, BR, Badlands 21-15TFH, Hawkeye, t9/13; cum 202K 9/19;
24626, 2,924, BR, Badlands 41-15MBH, Hawkeye, t8/13; cum 235K 9/19;
24625, 2,854, BR, Badlands 41-15TFH, Hawkeye, t8/13; cum 234K 12/20;
24624, 2,919, BR, Badlands 31-15MBH, Hawkeye, t8/13; cum 236K 12/20;
23822, 697, Hess, HA-State 152-95-1621H-2, Hawkeye, t5/13; cum 230K 12/20;
23821, 1,034, Hess, HA-State 152-95-1621H-3, Hawkeye, t5/13; cum 238K 12/20;
23820, 50 (no typo), Hess, HA-State 152-95-1621H-4, Hawkeye, t7/13; cum 209K 12/20;
23072, 1,089, Hess, HA-Dahl 152-95-0706H-3, Hawkeye, t12/12; cum 441K 12/20;
23071, 1,224, Hess, HA-Mogen-152-9500805H-3, Hawkeye, t12/12; cum 456K 12/20;
22982, 868, Hess, HA-Nelson A-152-95-3427H-2, Hawkeye, t9/12; cum 322K 12/20;
22972, SI/NC-->dry,
22801, 983, Hess, HA-Link-152-95-3526H-2, Hawkeye, t9/12; cum 335K 12/20;
22635, 1,114, Hess, HA-Swenson-152-95-1819H-5, Hawkeye, t5/13; cum 288K 12/20;
22420, PNC,
22417, SI/NC-->dry,
22416, SI/NC-->dry,
22415, SI/NC-->dry,
22367, PNC,
22366, 1,336, Hess, HA-Swenson 152-95-1819H-3, Hawkeye, t5/13; cum 167K 12/20;

2011 Permits
21122, 428, Hess, HA-Chapin-152-95-3229H-2, Hawkeye, t5/12; cum 156K 12/20;
20755, 381, Hess, HA-Dahl-152-95-0706H-2, Hawkeye, t3/12; cum 296K 12/20; a bump in production in 5/17;
20739, 826, Hess, HA-Thompson-152-95-1720H-2, Hawkeye, t5/12; cum 298K 12/20;
20738, 1,496, Hess, HA-Mogen-152-95-0805H-2, Hawkeye, t12/11; cum 671K 12/20;

Original Post

 

Hess Hawkeye well (not an EOG Hawkeye well):

• 28142, 1,110, Hess, HA-Swenson-152-95-1819H-7, Hawkeye, 35 stages; 2.4 million lbs; Three Forks, 9 days to reach TD; upper Bakken might have oil here; 100% in the second bench;  t2/15; cum 11K in five days; cum 278K 12/20;

I'll clean up this post later. See also this post on Clarks Creek. For now:

• 24337, 2,519, EOG, Hawkeye 3-2413H, Antelope, middle Bakken, 28 stages; 9.7 million lbs sand; 133K in less than four months; t5/13; 2 sections; TD = 20,626 feet; 842K 12/20;
  
• 22484, 2,946, EOG, Hawkeye 102-2501H, Clarks Creek, Bakken, Three Forks; 3 standup sections, 1920 acres; TD = 25,451 feet;  producing, first short month at 17,147 bbls, January, 2013; t1/13; cum 617K 12/20; extended long lateral (3 sections long); 
• 22485, 1,926, EOG, Hawkeye 01-2501H, Clarks Creek, Bakken, middle Bakken; producing, first short month at 17,721 bbls, January, 2013; TD = 25,827 feet; 3 stand-up sections, 1920 acres; extended long lateral (3 sections long); t1/13; cum 704K 12/20; intermittent production after 3/20; off line 4/20 - 6/20;might be coming back on line 7/20;
  
• 22486, 2,421, EOG, Hawkeye 100-2501H, Clarks Creek, Bakken, 3 standup sections, 1920 acres, Three Forks; 47 stages; 14 million lbs sand, extended long lateral (3 sections long); t9/12; cum 213K 1/13; TD = 25,101 feet; F; t9/12; cum 800K 12/20; offline as of 4/19; remains off line 9/19; intermittent production after 3/20; off line 4/20 - 6/20;might be coming back on line 7/20;
• 22487, 67, EOG, Hawkeye 02-2501H, Clarks Creek, t12/13; cum 877K 12/20; 3-section spacing; 69 stages; 27.6 million lbs; 1,741 acres in the spacing unit; sister well to this well announced earlier with 200,000 bbls in less than 5 months; another 15,000-ft horizontal; trip gas over 4,000 units; extended long lateral (3 sections long); GL; intermittent production after 3/20; off line 4/20 - 6/20;might be coming back on line 7/20;

This is an important note: this is the first time I noted that EOG is drilling three stand-up sections; these are what I call extended long laterals, one section longer than the "standard" long laterals. Note that four of the five wells above are about 25,000 feet total depth, three sections "long"; and/or 1920 acres stand-up.  Generally, we've only seen long laterals (as in #24337 above) two sections, 1280-acres, and about 20,000 feet total depth.

There have been other extended long laterals, out to 25,000 feet, but most, if not all of them were due to geographical constraints, that it, drilling under the river or the lake. See the Liberty wells in the link below. Prior to these wells, I think this might have been one of the longest, if not the longest in the Bakken. 

Chariots On Fire

Wow! I thought we were done with all these stories -- but, not so fast!

Now Tesla's are bursting into flames.

Yahoo!News is reporting:

Tape of a Tesla on fire is giving new meaning to the term "hot wheels." The video was shot on Tuesday after a Model S sedan went up in flames. The driver was traveling down a highway in Washington State when he hit some metal debris. Fortunately he pulled over and got out of the vehicle safely. Soon the luxury electric ride was a fireball.

As the video went wild on YouTube, Tesla's stock began tanking. It dropped more than 6% on Wednesday and moved lower again on Thursday.

In an e-mail sent to The New York Times, Tesla spokeswoman Elizabeth Jarvis-Shean wrote that the fire was caused by the “direct impact of a large metallic object to one of the 16 modules within the Model S battery pack.”

The e-mail went on to say, “Because each module within the battery pack is, by design, isolated by fire barriers to limit any potential damage, the fire in the battery pack was contained to a small section in the front of the vehicle.”

Sounds like everything was under control. Right? But the video appears to show anything but containment of the flames. Perhaps that's why investors began selling Tesla stock.

Fire containment:

Fire containment, according to Tesla spokesperson
Yes, indeed, it does appear that the fire was confined to one of 16 modules. Once the firemen put out the fire, the driver got back in and drove home. The remaining 15 modules had adequate power remaining. The driver will probably have his 6-y/o son replace the burned battery, Lego-like.

It should be noted that when a conventional automobile runs over a nail, a flat tire often ensues, but seldom a fire. At least in my experience.

Analysts have been predicting a pull-back in the price of Tesla shares. Analysts are getting better and better every day.

Flashback, someone noted:

"The Tesla Model S was deemed the safest automobile ever by the National Highway Traffic Safety Board, that's no exaggeration and I'm no spokesman; in the simulated collision tests the Model S charted the best outcome of any other car especially those with a combustion engine."