Wow! First-Time Unemployment Claims Surge; Jump Far More Than Expected; GDPNow Forecasts 2.3 GDP -- November 4, 2015

Multiple sources had inaccurate information, but this appears to be the correct numbers:

• for week ending October 31, 2015
• last week's numbers were unrevised; stand at 260,000 first time claims
• analysts generally expected an increase of 2,000 (although the range was quite wide)
• in fact, the number rose by 16,000
• the four-week average also rose to 262,750

From the various sources:

Initial jobless claims rise more than expected, from Business Insider:

Initial jobless claims climbed to 276,000 last week. Economists had forecast, according to Bloomberg, that the Department of Labor's data showed first-time claims for unemployment insurance totaled 262,000 last week, up 2,000 from the prior period.

The total number of claims has not topped 300,000 since March. The four-week moving average, which evens out some of the weekly volatility, rose to 262,750.

Last week's number of 260,000 was revised to 262,000. Today, the number surges 14,000 to 276,000. The rise was so much it affected the four-week average which also rose.

This increase of 16,000 was the largest since late February -- The Wall Street Journal. Note the Journal  uses the unrevised previous week figure. The WSJ says "claims were unrevised at 260,000 for the week ending October 24," at odds with Business Insider (one of them got it wrong).

The Journal also noted:

Fewer layoffs typically means hiring is picking up. But job gains have slowed in recent months, reaching 142,000 in September and 136,000 in August. That is well off the pace of around 230,000 new jobs a month on average over the past 12 months.

Can't wait to see the spin from Bloomberg and Reuters. They will highlight the fact that the total number of claims has not topped 300,000 since March. It is accurate that less than 300,000 is very, very good when one considers the magic number: a number greater than 400,000 suggests economic stagflation. But what surprises me is the magnitude by which analysts missed this one. Again.

And just yesterday, it was pretty much a foregone conclusion that Janet Yellen would "raise rates."

Yes, BloombergBusiness focused on the "lowest level since 1973" but noted that the most recent data showed unemployment benefits "climbed to the highest level in five weeks." BloombergBusiness also said that the previous week's numbers were not revised.

And here's where Business Insider misread/misheard/mis-reported: the previous week was not revised upward by 2,000. Rather, the expectation was that new claims would rise by 2,000. In fact, the number, as noted above, surged by 16,000.

Applications increased by 16,000 to 276,000 in the week ended Oct. 31, a Labor Department report showed Thursday. It marked the biggest advance since the end of February, while the level exceeded the Bloomberg survey median estimate of 262,000. The four-week average of claims climbed from the lowest in four decades.

Also note the discrepancy between which week they say they are reporting. Whatever.

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GDP Forecast

From GDPNow:

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2015 is 2.3 percent on November 4, up from 1.9 percent on November 2. Following this morning's Non-Manufacturing ISM Report On Business, the forecast for fourth-quarter real consumer spending growth increased from 2.4 percent to 2.7 percent while the forecast for real fixed investment growth increased from 3.0 percent to 4.3 percent.

Reporting Thursday -- November 4, 2015; Will Bass Pro Shops Buy Cabela's?

Bass Cabela Pro Shops

Will privately-hell Bass Pro Shops buy Cabela's? This apparently started when Cabela began looking at its options.

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Apache

From Reuters/Rigzone, November 5, 2015: 

Apache Corp reported a much smaller-than-expected quarterly loss and joined a growing list of US oil producers in raising full-year production forecast even as many of them cut spending. 

Increased efficiencies, a drop in service costs and low break-even levels in core US shale fields are all helping US oil companies increase production on reduced budgets. 

US producers ranging from Oasis Petroleum to Devon Energy have forecast higher production in their latest quarterly reports.

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Reporting Thursday

Apache Corp (APA), forecast a loss of 36 cents; Reuters;

a much bigger quarterly loss as it took a $3.7 billion writedown due to a slump in oil prices

Net loss attributable to Apache's common shareholders widened to $5.56 billion, or $14.95 per share, in the third quarter, from $1.33 billion, or $3.50 per share, a year earlier.

CenterPoint Energy (CNP), forecast 30 cents; Zacks; beat by 4 cents at 34 cents;

Crescent Point Energy (CPG.TO), forecast 3 cents; AP; earnings came to 2 cents;

Denbury Resources (DNR), forecast 13 cents; AP; beats by 5 cents at 18 cents per share;

Enbridge (ENB.TO), forecast 49 cents; WSJ;

Canadian / US dollars makes forecast / actual difficult to compare; WSJ says 47 Canadian cents were up from 41 Canadian cents a year earlier but fell just short of hte 49 Canadian cents analysts were expecting; from Reuters: Enbridge Inc, Canada's largest pipeline company, reported a 15.7 percent rise in quarterly adjusted profit, helped by increased throughput as producers moved more oil by pipelines than on rail. The Calgary-based company's adjusted earnings rose to C$399 million ($303.4 million), or 47 Canadian cents per share, in the third quarter ended Sept. 30, from C$345 million, or 41 Canadian cents per share, a year earlier. ($1 = 1.32 Canadian dollars)

Linn Energy (LINE), forecast 13 cents; press release;

Windstream Holdings (WIN), forecast a loss of 34 cents; AP;

wow, huge beat; forecast to lose 41 cents by Zacks, WIN reports a loss of only 13 cents;

WPX, forecast a loss of 14 cents; AP;

slightly wider than foecast; Zacks predicted a loss of 12 cents; actual loss was 17 cents/share;

Clean Energy Fuels (CLNE), forecast a loss of 28 cents; press release here;

if I read this correctly, the loss was 23 cents; much better than forecast;

EOG, forecast a loss of 29 cents; press release; transcript;

Halcon (HK), forecast one cent; press release; at Seeking Alpha;

if I read this correctly, net income was 4 cents; if accurate, a huge beat;

Walt Disney (DIS), forecast $1.14; AP; beat nicely at $1.20/share;

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Tyranny Of A Big Idea -- Op-Ed in The Wall Street Journal

Link here. Well worth reading. 

Remember Paul Ehrlich?

Paul Ehrlich helped get the ball rolling with his 1968 blockbuster “The Population Bomb,” which begins with the words: “The battle to feed all of humanity is over. In the 1970s and 1980s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now.” Mr. Ehrlich, a biologist at Stanford, had no scholarly credentials as a demographer or an economist. But that didn’t keep him from putting a scientific gloss on a personal prejudice.
From “The Population Bomb” there came Zero Population Growth, an NGO co-founded by Mr. Ehrlich. Next there was the United Nations Population Fund, founded in 1969, followed by the neo-Malthusian Club of Rome, whose 1972 report, “The Limits to Growth,” sold 30 million copies. In India in the mid-1970s, the Indira Gandhi regime forcibly sterilized 11 million people. Then-World Bank President Robert McNamara praised her for “intensifying the family planning drive with rare courage and conviction.” An estimated 1,750 people were killed in botched procedures.

And now it's global warming.

What matters, rather, is the strength of the longing. Modern liberalism is best understood as a movement of would-be believers in search of true faith. For much of the 20th century it was faith in History, especially in its Marxist interpretation. Now it’s faith in the environment. Each is a comprehensive belief system, an instruction sheet on how to live, eat and reproduce, a story of how man fell and how he might be redeemed, a tale of impending crisis that’s also a moral crucible.

In short, a religion without God. I sometimes wonder whether the journalists now writing about the failure of [China's] one-child policy ever note the similarities with today’s climate “crisis.” That the fears are largely the same. And the political prescriptions are almost identical. And the leaders of the movement are cut from the same cloth. And the confidence with which the alarmists prescribe radical cures, their intolerance for dissenting views, their insistence on “global solutions,” their disdain for democratic input or technological adaptations—that everything is just as it was when bell-bottoms were in vogue.

Meanwhile, for the archives, Representative Lama Smith (R-Texas)  has subpoenaed NOAA internal documents now that there is evidence that NOAA may be misleading (is "lying" too strong a word?) the American public.

Simple Housekeeping -- Reposting Previously Posted Material -- November 4, 2015

This is simply some housekeeping. Nothing new here. This has all been posted before. The page where this came from was getting too long. These are wells that I was watching for some reason or other; once I saw what I wanted to see, I "closed" them out.

I no longer follow these wells.

CLOSED

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January 27, 2016:  Fidelity has been sold by MDU in five separate deals; they have not been formally announced. We need to watch operator changes for Fidelity wells. For example, these two Fidelity wells were chronologically next to each other (Limestone Resources bought the Fidelity assets in this area some time ago -- not part of the recent entire Fidelity sale. Turns out that Kaiser-Francis was the operator who got the lion's share of the Fidelity wells:

• 24052, 738, Kraken/Kaiser-Francis/Fidelity, Wayne 3-4-33H, Sanish, 4 sections, 4/13; cum 277K 10/20; small jump in production 8/19;
  
• 24511, 52, Lime Rock Resources/Fidelity, Irene 12-13H-24, Alger, t4/13; cum 167K 10/20; went off line 5/19; back on line and good production, as of 9/19;

December 5, 2015: was waiting to post fracking data -- posted -- can be moved to "Closed" status:

• 25467, 1,821, Whiting, Privratsky 11-27PH, Zenith, Three Forks (Pronghorn), 40 stages, 3.04 million lbs, t3/14; cum 201K 10/20;
  
• 25468, 1,920, Whiting, Privratsky 21-27PH, Three Forks (Pronghorn), 40 stages, 3 million lbs, t3/14; cum 244K 10/20;
  
• 25469, 2,272, Whiting, Privratsky 41-27PH, Zenith, Three Forks (Pronghorn), 40 stages; 3 million lbs sand; t3/14; cum 243K 10/20;

November 16, 2015: 25924, 55, Hess, EN-Jeffrey A 155-94-2734H-5, Alkali Creek, 4 sections, t6/14; cum 184K 10/20; 34 stages; 3.5 million lbs sand. [Update, November 18, 2014: this well was fracked 2/14; still having problems. Zero bbls June/July, 2014; 25K in 27 days in August, 2014 -- was that a commingling error; but then only 9K bbls in 21 days in September; paperwork for commingling submitted. Update, June 13, 2015: looks like well is back on track]; off line as of 7/19;


November 3, 2015: follow up on this re-frack? #20755. Not a re-frack; simply some work on the pad mostly likely. Nothing to see here. This item closed November 3, 2015. But it's still a good well; cum 393K 10/20;


June 17, 2015: I need to complete the January, 2015, dockets.

September 19, 2015:

• Permitted for re-entry: 16439, 373, MRO, Hecker 21-5H, Murphy Creek, t9/07; cum 315K 10/20; last on-line 11/14; still off-line as of 6/15; back on ACTIVE status on/about 6/15; tracked here; back on line 4/18 and doing very, very well as of 9/19; continues to do well in 10/20;
  

September 27, 2014:

• 19294, PNC, Whiting, BSMU 3605, a Madison well;

Note these very low IPs for EOG in the Parshall; these wells were noted in the July 28, 2014, daily activity report, but on November 18, 2014, when re-checked, they were both back on confidential, and no IP was provided at the NDIC site. I now track both these wells here:

• #27441 - EOG RESOURCES, INC., PARSHALL 65-14H, NWNW 14-152N-90W, MOUNTRAIL CO., 446 BOPD, 2354 BWPD - BAKKEN
  #27442 - EOG RESOURCES, INC., PARSHALL 66-14H, NWNW 14-152N-90W, MOUNTRAIL CO., 394 BOPD, 2376 BWPD - BAKKEN

• 27441, 446, EOG, Parshall 65-14H, Parshall, short lateral, t7/14; from the file report, after reaching TD, gas reached a max of 10,000 units as the well began to flow; 25 stages, 7.6 million lbs; cum 131K 10/10; off line 4/19; remains off line 9/19;
  
• 27442, 394, EOG, Parshall 66-14H, Parshall, short lateral, t7/14; 19 stages, 5.8million lbs; cum 118K 3/20; intermittent since then; remains off line 10/20; went off line 1/19; back on line 9/19;

26335, PA/18, MRO, Powell 31-27TH, Wildcat, Tyler, t4/15; cum 638 bbls 4/15;  the second Tyler well "everyone" is waiting for, 24 stages; 800K lbs (minimal frack); t8/14; cum 434 bbls; apparently this well will be PNA in May, 2015; PNA as of 6/20/15;

A comment from a reader, received June 27, 2014:

I'm a non-op partner in 143-97 Leroy Petry Oxy well (#26370).  One of my buddies got his first check today and along with it was a letter saying OXY is selling part of its assets to Merit Energy.  Thought I would pass along.  When I get my paperwork I'll let you know; update July 3, 2015 -- still an OXY USA well; Lime Rock;

December 1, 2014, 4:44 p.m. CT: for some inexplicable reason, the number of active rigs in North Dakota jumped from 183 on Black Friday, November 28, 2014, to 189 on Monday, December 1, 2014 during some of the most miserable weather ever in the history of the Bakken boom during the late days of November. If the active rig rate holds or actually increases despite the slump in oil prices, one needs to ask the question, why? This could be an unintended consequence of the slump in oil prices, as operators start to circle the wagons and start to drill the better spots to "stay alive." If the marginal shale plays in the US see a decrease in rig counts, some operators to maintain their production or meet their contracts, may start to move their rigs to the better spots. The Bakken is known for a) consistency; b) reliability; c) adequate takeaway; d) improving infrastructure. So we'll see. I will not put this in a stand-alone post for several reasons. [Update, March 20, 2015 -- my irrational exuberance got ahead of me -- rigs plunged; now stand at 107. Update, June 13, 2015 -- my irrational exuberance got way ahead of me -- active rigs have plunged to lowest post-boom record, at 76]


April 9, 2015: need to get frack data on these two wells

• 28075, 3,255, MRO, Anthony USA 23-14H, Moccasin Creek, 2.5 section-long horizontal; 100% within the middle Bakken; 93% within MOC geology defined target interval; gas max at 1,300 units; 3,840 acres drilling unit; 23,148 feet TD; 43 stages; 4.5 million lbs; t2/15; cum 503K 10/20;
  
• 28076, 3,255, MRO, Hale USA 23-14TFH, Moccasin Creek, 2.5 section-long horizontal; Three Forks, 100% within the Three Forks Formation; 69% within the MOC geology defined target interval;  gas units very, very low; a 1 - 5' intermittent flare near the end of the lateral; 23,148 feet TD; 43 stages; 4.5 million lbs; t2/15; cum 271K 9/19; 296K 10/20;
  

October 16, 2014: nomenclature of this well? #29727 -- Eide 41-13HU. This well is on 4-acre spacing;

• 29727, 2,319, Whiting, Eide 41-13HU, 4 sections, middle Bakken; 30 stages; 3.4 million lbs; seam 22 feet thick?; max gas at 4,697 units, a consistent 2 - 5 foot flare; t2/15; cum 242K 10/20; jump in production, 7/19;

October 12, 2014: 20342, 1,430, Petro-Hunt, USA 153-95-4B-9-1H, t11/11; cum 900K 10/18; cum 1.140061 million bbls 10/20; went IA 1/14; still inactive as of 6/14; back on line and tracked here; according to NDIC this well has never been re-fracked since the 2011 frack; that is confirmed by FracFocus; update here;

September 11, 2014: several Oasis wells with very short horizontals; in the process of being completed? I had not seen this before (or don't recall); I was incorrect: these are not very short laterals (see explanation at the link); standard long lateral (about 9,300 feet horizontally)

August 2, 2014: a three-section horizontal lateral

• 25959, 732, CLR, Haffner 1-31H, Noonan, middle Bakken; 1920-acre; 50 stages; 7 million lbs, a true 3-section lateral (full sections 19/30/31 - 162-95); background gases "poor"; t3/14; cum 198K 1/20;

November 29, 2014: new designation for a Whiting well?  Yes, TFHU -- the "U" means "unit" -- 2560-acre unit.

• 27522, 4,207, Whiting, Flatland Federal 11-4TFHU, Twin Valley, spacing: 2560-acre; t10/14; cum 572K 1/20; huge jump, 3/19;

November 29, 2014, a huge well;

• 17314, 431, MRO, Brown 24-9H, Killdeer, a 10 - 30' flare for fifty minutes; this is a bit confusing for me, but I believe this well was spud/completed in 2008, but it was re-fracked in August, 2014, and that's why it shows up in today's report; the re-frack data was not yet scanned in; last full month production was in July, 2014; it will be interesting to see what new production numbers are and what the re-frack data is; t8/08; cum 426K 1/20; update here.

November 18, 2014: a huge CLR North Red River B well back on active status; looks like some type of workover in May/June, 2014, when there was no production; off-line from mid-April to mid-July, 2014; a huge producer back on line.

• 16529, 100, CLR, Spry 11-13NH, Cedar Hills, a North Red River B well, t8/07; cum 655K 1/20;

The Lawrence well in North Tioga,  #17745, posted May 10, 2014. They are back on line as of August, 2014. 

Also, later: #18341.

Was this well that produced 30,000 bbls in the first month really canceled by EOG? This will end up being a non-story. See this post. My hunch is that the "30,000" was an error.

Why did they take this great well off-line in July, 2013? A great well to follow periodically.

• 17310, Rosemary Eckelberg 41-26H, 459, 49,138 bbls in 15 months; t8/08; cum 173K 1/20; went back on line 1/14; significant increase in oil production; no explanation in well file;

Hit the one-million-bbl milestone:

• 7571, PA/482, Hess, Reitsch NCT-2 4, Blue Buttes, a Silurian well, t4/81; cum 1.0062 million bbls 7/17;

#20879 has two laterals, drilled at separate times. They have different names: -1H and -2H but yet carry the same permit number, #20879.

• 20879, 2,709, Bruin/HRC, Fort Berthold 147-94-1A-12-2H, McGregory Buttes, t1/14; cum 508K 1/20; see this note, 10/18;
  

The Carlson 1-11H well was taken off line 2/14; no explanation. Need to recheck in a few months. Posted 6/14. [Apparently back on-line, 5/14.]

• 19169, 685, Bruin/HRC, Carlson 1-11H, Strandahl, northwest of Williston, t2/10; cum 85K 1/20; this was GEOI's first completed Bakken well at a cost of $5.6 million; remains a lousy well (3/19);

One to follow: 18362 -- the answer here: http://themilliondollarway.blogspot.com/2014/09/random-update-on-mros-uran-31-2h-well.html

• 18362, 641, MRO, Uran 31-2H, Reunion Bay, t6/10; cum 343K 3/19; 15 stages, 2.6 million lbs; no explanation why it was taken off-line for four months in mid/late-2013, and then came back with much better production; interesting: after being offline for six months, had one bbl of crude oil over one day, 1/20;

Flaring. I doubt I will ever do a story on this, but if push comes to shove, I might. This well, along with 1,000's of others, would never have been drilled, and would now be shut down, if all flaring was banned in North Dakota: 

• 10217, 80, Legacy Reserves, Spring Creek Federal 6, Mondak, a Madison well, t10/83; cum 164K 1/20 (very little being produced, 1/20); at $50/bbl, this represents $7.7 million in crude oil; at $5/MCF natural gas, that represents $500,000 in natural gas. It would have cost several million dollars to put in a natural gas pipeline, assuming that regulators would even have allowed a pipeline for one well this remote. Spud in 1983, this well is flaring almost no natural gas but a very, very tiny bit is being flared. I cannot explain why it can go years producing oil but flaring no natural gas, and then back to flaring small amounts. Whatever meager amounts are being produced, none is being sold. [Update: I believe the rules state that the wells have to be producing at least 200 bbls of crude oil to be affected by new flaring rules, or about 6,000 bbls per month. This well is producing only 350 bbls of crude oil per month so it is not affected by new flaring rules.]

Six Wells Forbes And Reuters Analysts Won't Believe; And To Think The Wells Are All Choked Back -- November 4, 2015

A huge thank you to a reader again: just yesterday a reader reminded me of FracFocus to see if a given well has been fracked. Already, I've used FracFocus to see if a certain well was fracked; see below. 

Wells coming off confidential list Thursday:
This is very interesting. Six months ago we were well into a price "situation" due to the glut of oil, and yet here we are today (actually tomorrow) when nine wells will come off the confidential list. I haven't look at them yet; perhaps the permits were all PNC'd but let's take a look:

• 27419, SI/NC, CLR, Garfield Federal 6-5H, Banks, no production data,
• 29330, 180, Triangle, Wisness 150-100-23-14-11TFH, Timber Creek, 31 stages, 4 million lbs, t5/15; cum 35K 9/15;
• 29331, 655, Triangle, Wisness 150-100-23-14-7H, Timber Creek, 31 stages, 4 million lbs, t5/15; cum 57K 9/15;
• 29373, 2,235, QEP, P. Levang 2-14-23BH, Grail, 49 stages, 10 million lbs, t5/15; cum 97K 9/15;
• 29374, 2,342, QEP, P. Levang 1-14-23BH, Grail, 49 stages, 10 million lbs, t5/15; cum 72K 9/15;
• 29375, 2,298, QEP, P. Levang 14-13-23-24-LL, Grail, 48 stages, 9.9 million lbs, t5/15; cum 103K 9/15;
• 29749, 2,159, QEP, P. Levng 1-14TH, Grail, 49 stages, 6.7 million lbs, t5/15; cum 89K 9/15;
• 29861, SI/NC, XTO, Johnsrud Federal 34X-14A, Bear Den, no production data,
• 31013, SI/NC, Newfield, Wahus Federal 152-97-13-24-4H, Westberg, no test date; cum 9K 9/15 over 12 days; API: 33-053-06848-00-00; according to FracFocus this well was fracked 9/3 - 8/15; appears to have used around 5 million lbs sand;

Yes, there might be six wells here that analysts over at Forbes and Reuters might not believe, and to think these wells are probably choked back by now.

Three (3) new permits --

• Operators: XTO (2), EOG,
• Fields: Bear Creek (Dunn), Clarks Creek (McKenzie),
• Comments: Wow, EOG has another permit for section 25-152-95; see this most recent post on this area;

Permit renewals continue:

• Hess renewed five permits, the AN-Gudbranson permits in McKenzie County
• American Divide renewed two permits, the Curly and the Kenyon in Divide County

One (1) producing well completed:

• 29443, 1,442, WPX, Olive Mae 7-8-9HW, t10/15; cum -- ;said to be on Active Status but has reported no production; application for Three Forks B1, but changed to middle Bakken; 1920-acre spacing; API: 33-061-03307-00-00. FracFocus says this well was fracked 9/13 - 28/15, but there has been zero bbls of production; it was on line for two days back in February, 2015; looks like maybe as much as 14 million lbs of sand (no ceramic); huge, huge amount of fluid: 13,445,058 gallons of water (320,000 bbls @ 42 gal/bbl); almost 12% of total HF was sand. (Disclaimer: I often make simple arithmetic errors. If this information is important to you, go to the source.)

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29330, see above, Triangle, Wisness 150-100-23-14-11TFH, Timber Creek:

Date	Oil Runs	MCF Sold
9-2015	5818	0
8-2015	8673	11149
7-2015	12469	15239
6-2015	4887	4806
5-2015	3425	992

29331, see above, Triangle, Wisness 150-100-23-14-7H, Timber Creek:

Date	Oil Runs	MCF Sold
9-2015	5026	0
8-2015	9067	12436
7-2015	14750	17729
6-2015	12701	14701
5-2015	15519	12473

29373, see above, QEP, P. Levang 2-14-23BH, Grail:

Date	Oil Runs	MCF Sold
9-2015	20864	13684
8-2015	1186	931
7-2015	25573	23461
6-2015	30541	26333
5-2015	18452	15688

29374, see above, QEP, P. Levang 1-14-23BH, Grail:

Date	Oil Runs	MCF Sold
9-2015	759	350
8-2015	4499	4781
7-2015	8356	7145
6-2015	28407	23865
5-2015	30169	27802

29375, see above, QEP, P. Levang 14-13-23-24-LL, Grail:

Date	Oil Runs	MCF Sold
9-2015	13719	13172
8-2015	18082	18166
7-2015	8889	9196
6-2015	29251	34989
5-2015	32112	36042

29749, see above, QEP, P. Levng 1-14TH, Grail:

Date	Oil Runs	MCF Sold
9-2015	12367	7751
8-2015	9102	11325
7-2015	16820	15459
6-2015	29209	25456
5-2015	21328	18564

31013, see above, Newfield, Wahus Federal 152-97-13-24-4H, Westberg:

Date	Oil Runs	MCF Sold
9-2015	8972	11183

Now We See Why Agency Reluctant To Release Cost Data On California Bullet Train -- November 4, 2015

Updates

November 26, 2015: hearings will be held in state legislature over this project cost overrun. In the original post:

Buried deep in the article we get the current "final" estimate: $71 billion from an original $27 billion -- the amount California voters were told at the time they voted to support Jerry's pet train project.

Now, in this new LA Times article, they manage to crawl back the $71 billion back to the $68 billion. 

Original Post

 

We have $30 billion, now we have $40 billion, do I hear $60 billion, can I get $80 billion?

The Auctioneer Song, Leroy Vandyke

The Los Angeles Times is reporting:

The California high-speed rail authority bowed to pressure from California legislators and members of Congress late Tuesday and released a copy of a 2013 report showing a large estimated increase in the cost of building the initial segment of the bullet train project.

The report, disclosed by the Times in a story Oct. 25, said Parsons Brinckerhoff had briefed state officials in October 2013 that the projected cost of the first phase of the bullet train system had risen 31%. The state did not use the increase, however, in its 2014 business plan four months later.

A dozen members of Congress and four members of the California assembly had written to the state and to Parsons Brinckerhoff asking for disclosure of the report.

Rail authority chairman Dan Richard and CEO Jeff Morales released the document and said the cost estimates it contained are part of an iterative process and that the numbers were "preliminary, still in development and subject to review clarification and refinement." They say initial contracts have come in below budget.

"The authority under the present leadership has always been forthcoming about the costs and risks of the program," Richard said.

Buried deep in the article we get the current "final" estimate: $71 billion from an original $27 billion -- the amount California voters were told at the time they voted to support Jerry's pet train project.

The report shows that the cost of building the first segment from Burbank to Merced had grown from $27.3 billion to $35.7 billion, not including future inflation.

The state publishes most of its public cost figures with future inflation included, which would translate the cost of the initial segment from the current $31 billion to about $40 billion, based on the Parsons Brinckerhoff estimates.

The document also shows the cost of the entire project would increase by about 5%, going from $54.4 billion to $56.9 billion without inflation. If future inflation is included, based on the Parsons Brinckerhoff inflation estimates, the total project cost would go from $68 billion to more than $71 billion.