Wednesday, September 12, 2018

Evening Wrap -- Nothing About The Bakken -- September 12, 2018

Doubling down. I have to laugh. Going into today's Apple presentation, "everybody" said Apple had to "come down on their prices." So, what did Apple do? Raised prices significantly. Sure, they brought in a lower-priced phone .... at $749 ... but the top end is pushing $1,500. But these phones are heavily subsidized by the carriers. And, yes, folks will trade up.  Bottom line: bigger, pricier phones. What a great country. And now, get this: one phone -- two telephone lines. Wow. I did not see that one coming -- and apparently neither did anyone else. Politicians with mistresses are going to love that feature.

Can Americans afford these expensive phones? You decide. From The Washington Post, "middle-class income rose above $61,000 for the first time every," according to Trump's census bureau.

Hurricane Florence: speaking of Trump, apparently the president called Mother Nature, threatened the old lady with sanctions if she didn't moderate the storm. Mother Nature blinked. The hurricane has been downgraded from Category 4 to Category 3 -- and hasn't even hit landfall yet. Can't make this stuff up.

Disclaimer: this is not an investment site.

UNP: thank goodness for "my" readers. I would have missed this story. Union Pacific's dividend has been raised three times in the last year and the payout ratio is still very low. I was not paying attention. I did not know that. I've been accumulating UNP for the past eighteen months or so. Completely unaware about the dividend story. Better lucky than smart, my dad always used to say. My dad was both smart and lucky.

One of my mom's favorite singers:

A Statue of a Fool, RVS

Jamie Dimon's salary: in 2017, total compensation, $29.5 million, let's call it $30 million. Meanwhile, in Chicago, it looks like the city is one step closer to doling out $6 million / year to give 1,000 families $500/month -- a proof-of-concept to see if this will end poverty as we know it in our lifetime. Or proof-of-concept to see if it will get Rahm Emanuel the Democratic nomination for president to run against the Donald in 2020. I know the first thing a Chicagoan would buy if given $500 -- a gun to protect himself/herself. Then a deep dish pizza at Tano's Pizzeria.

Look At All The Activity In This Area -- September 12, 2018





The wells:
  • 33869, conf, MRO, Wickett 24-35TFH, Bailey,
  • 33870, conf, MRO, Arthur 24-35H, Bailey,
  • 33871, conf, MRO, Rummel 24-35TFH, Bailey,
  • 33872, conf, MRO, Lawrence 24-35H, Bailey,

  • 34047, conf, MRO, Lucas 34-35TFH, Bailey,
  • 34046, conf, MRO, Two Bar 34-35H, Bailey,
  • 34045, rig on site, MRO, Gudmon 44-35TFH, Bailey,
  • 34044, conf, MRO, Rafter X 44-35H, Bailey,
  • 35268, conf, MRO, McCrory 44-35TFH, Bailey,
  • 35267, conf, MRO, Catherine 44-35H, Bailey,

  • 34048, conf, MRO, State Kelling 14-36TFH, Bailey,
  • 34049, conf, MRO, State Kreiger 14-36H, Bailey,
  • 34050, conf, MRO, Gudmon 44-35TFH, Bailey,

  • 32791, conf, BR, Patton 1A TFH, Bailey,

  • 17976, 110, BR, Patton 21-1HH, Bailey, t9/09; cum 267K 7/18;
  • 32715, conf, BR, Patton 1A TFH, Bailey,
  • 32716, conf, BR, Patton 3B MBH, Bailey,
  • 32717, conf, BR, Patton 3C TFH, Bailey,

  • 19775, 2,645, BR, Patton 31-1H, Bailey, t7/11; cum 300K 7/1;
  • 18588, 469, MRO, State Howard 34-36H, Bailey, t6/10; cum 153K 7/18; back on line after several months of being shut in;

  • 32792, conf, BR, Patton 5A TFH, Bailey,

For Newbies: The Predictability Of The Bakken; The Incredible Success Rate -- September 12, 2018

I'm running through the 18XXX wells tonight, and I come across this one.

Wow, spud in 2010, and has production numbers like this.


Obviously a re-frack.

So, I look at the operator and the field. Absolutely predictable.


MRO re-fracking wells in the Bailey oil field.

Absolutely predictable.

Checking FracFocus. Yes, re-fracked 8/11/17 - 8/25/17.

I wonder, what kind of frack? A small to moderate one: 5.9 million gallons of water; 89% water by weight; 10% sand by weight. So, MRO gets another nice well with a small-to-moderate re-frack.

And something else.

They "never" screw up.

I almost never see a well that is not successfully re-fracked.

These guys are good. Not just MRO but all the operators in the Bakken.

Two miles down; two miles horizontal; hit a seam forty feet thick; know within inches where the well bore is; and successfully complete a well 99.999% of the time, it seems.

What's the production look like from the re-frack? Absolutely incredible:

PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
BAKKEN7-201831138891376315464107508938740
BAKKEN6-20183014242143351527910417928550
BAKKEN5-201831168381683294701065275581839
BAKKEN4-2018241523515196132101004126935591
BAKKEN3-201825154771552118044107688433538
BAKKEN2-2018261735617282186111169263843322
BAKKEN1-2018292382023889304121704113573759
BAKKEN12-2017222085220816246121432182823699
BAKKEN11-2017251654716593187781193389811047
BAKKEN10-20173128177281083475519296136322465
BAKKEN9-20171616166162031421165011288706
BAKKEN8-20170000000

How does that compare to the original frack back in 2010?

BAKKEN6-2011303597375510671843163430
BAKKEN5-2011313355347092716421334122
BAKKEN4-20113047304722143216811359142
BAKKEN3-2011293956372014923009245
BAKKEN2-201128771697926300462
BAKKEN1-2011311707183536219260
BAKKEN12-20102614451384283175280
BAKKEN11-2010302042212436218660
BAKKEN10-201044402357101790
BAKKEN9-2010118447410600
BAKKEN8-201020258921367105023820

And, then this: there are literally tens of thousands of wells that were drilled between 2007 and 2012 that need to be re-fracked.

When folks talk about drilling the Bakken for the next 30 years, they are talking about new wells. The re-working, re-fracks, etc., will carry them another generation (or two).

By the way, MRO re-fracked the other well, a Repp well, #16753, in this same drilling unit; same success. Only two wells in this drilling unit but producing like it has four.

US Gasoline Demand -- I Certainly Cannot Explain It -- September 12, 2018

I've talked about this a lot. I certainly can't explain it -- link here:

"Big number" data suggests that air travel this past travel season (summer 2018) explains why US gasoline demand lagged that of summer 2017. Probably a stretch, but:
  • big number data supports the conjecture (see EIA data this post)
  • the 2018 economy was on fire compared to the economy in 2017, and even the 2017 economy was doing well
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Trans Mountain Pipeline News Today

I particularly enjoy the first story --- was / is "the fight" worth it?


From the linked article:

The city of Burnaby says it has spent $1.12 million in legal costs to fight the Trans Mountain Pipeline Expansion Project since 2014.

City Manager Lambert Chu says he can’t break down individual cost for each court case Burnaby has fought and lost, and the associated fees.

“By disclosing the breakdown we are also sharing information on how are legal strategy was constructed.”
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Millennials And Journaling

This is so interesting. Do you remember this note from this post?
Making lists .... "Others, like the list of eggs, are stock-keeping exercises: taking the measure of our gold. This kind of listmaking is coming back into vogue among millennials with the rise of 'journaling': a habit of listing the good things that happened during the day as a way of improving mental health."
I read that note to my wife, and then I asked myself: has anyone else noted this "habit" among millennials?

See this link over at Forbes.

Re-Entry Of An Old Duperow - Stonewall Well -- September 12, 2018

September 12, 2018, daily activity report -- recompleted well:

  • 14876, White Rock Oil & Gas, Federal 16-28; 
Sundry form:
  • stimulated formation: Stonewall, 3/4/17
  • recompleted and commingled production from the Mondak-Stonewall pool and Mondak-Duperow pool; allocation will be based on fingerprint analysis; currently, allocation suggests 47% Duperow, 53% Duperow; rod lift with "19 oil, 15 gas, and 48 water."
Screenshot of scout ticket:

NDIC File No: 14876     API No: 33-053-02527-00-00     CTB No: 114876
Well Type: OG     Well Status: A     Status Date: 6/22/2018     Wellbore type: Vertical
Location: SESE 28-148-104     Footages: 1240 FSL 1060 FEL     Latitude: 47.607951     Longitude: -103.929577
Current Operator: WHITE ROCK OIL & GAS, LLC
Current Well Name: FEDERAL 16-28
Elevation(s): 2451 KB   2430 GR     Total Depth: 13130     Field: MONDAK
Spud Date(s):  10/14/1999
Casing String(s):  9.625" 2067'   5.5" 13110'  
Completion Data
   Pool: DUPEROW     Perfs: 11248-11254     Comp: 6/22/2018     Status: AL     Date: 7/3/2018     Spacing: E2
   Pool: RED RIVER     Perfs: 12906-12931G     Comp: 2/24/2000     Status: PNA     Date: 2/27/2017     Spacing: E2
   Pool: STONEWALL     Perfs: 12564-12574     Comp: 3/13/2017     Status: PNA     Date: 3/13/2017     Spacing: E2
Cumulative Production Data
   Pool: RED RIVER     Cum Oil: 604982     Cum MCF Gas: 981163     Cum Water: 304550
   Pool: STONEWALL     Cum Oil: 3730     Cum MCF Gas: 2652     Cum Water: 2106
   Pool: DUPEROW     Cum Oil: 292     Cum MCF Gas: 144     Cum Water: 717
Production Test Data
   IP Test Date: 2/24/2000     Pool: RED RIVER     IP Oil: 655     IP MCF: 590     IP Water: 5
   IP Test Date: 3/15/2017     Pool: STONEWALL     IP Oil: 34     IP MCF: 31     IP Water: 5
   IP Test Date: 7/3/2018     Pool: DUPEROW     IP Oil: 132     IP MCF: 8     IP Water: 2
Monthly Production Data
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare
DUPEROW7-201831292727171441440
RED RIVER7-20180000000
STONEWALL7-20183133014914331651650
RED RIVER6-20180000000
STONEWALL6-201830536536167000