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Bakken April Production Data

The North Dakota Industrial Commission is out with the April production Data for the Bakken and all North Dakota . Eight month of flat to down production from the Bakken. Bakken Amplified I have shortened the data to 16 months here to give a better picture of what is really happening. North Dakota reached an 8 month low. North Dakota, in April, was 17,631 barrels per day below their September 2014 production. The Bakken was only 11,024 below September 2014 so conventional wells seem to be dropping off pretty fast. The Baken is 54,599 bpd below their peak in December and all North Dakota is 59,385 bpd below their December Peak. As usual there was very little adjustments in the previous months data. Bakken March production was adjusted down by 114 barrels per day while North Dakota production was adjusted down by 81 barrels per day. Bakken BPD Per […]

Posted On : Published By : Tom Whipple
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BHI: US rig count continues fall in 27th straight week

The US drilling rig count declined 9 units during the week ended June 12 to settle at 859 rigs working, according to data from Baker Hughes Inc. After 22 straight weeks of double-digit and near triple-digit declines, the count over the past 5 weeks has dropped by an average of just 7 rigs/week. It has now fallen in 27 consecutive weeks overall, during which time it has lost 1,061 units ( OGJ Online, Dec. 5, 2014 ). Compared with this week a year ago, the count is down 995 units. An energy update earlier this week from Raymond James & Associates indicated that the number of weekly well permits issued in the US last week, using a 4-week average, was flat compared with the prior week. A primary indicator of rig count activity, 865 permits were issued last week, up from 839 during the previous week. However, the 4-week […]

Posted On : Published By : Tom Whipple
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U.S. fracking rules to face early legal test

WASHINGTON Energy industry groups and states that oppose new U.S. rules for hydraulic fracturing on public lands are headed to court this month to try to block the regulations a day before they are to take effect. Foes of the regulations will go before a federal judge on June 23 to seek a preliminary injunction. The Interior Department rules, slated to take effect on June 24, would require companies to provide data on chemicals used in hydraulic fracturing, or fracking, and to take steps to prevent leakage from oil and gas wells on federally owned land. This is the "first tranche in this battle," said Dan Naatz, senior vice president for government relations at the Independent Petroleum Association of America (IPAA), one of the groups seeking the injunction. Fracking involves injection of large amounts of water, sand and chemicals underground at high pressure to extract fuel. Environmental groups and […]

Posted On : Published By : Tom Whipple
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Disappearing Bakken oil discount adds to output slowdown signs

NEW YORK Oil traders scrambling to secure crude in the U.S. Midwest have pushed North Dakota’s Bakken to a near premium for the first time in two years, a rally stoked by record refinery runs and an unprecedented slump in Canadian imports. Yet some traders say the surprising strength emerging from opaque physical crude markets in the heartland of the fracking boom also points to a more important, lasting factor: declining production of Bakken crude, a long-anticipated but as yet unproven twist in the shale revolution. The buying frenzy pushed Bakken delivered at Clearbrook, Minnesota WTC-BAK, to trade just 35 cents a barrel below the West Texas Intermediate benchmark last week, dealers say, the narrowest discount since July 2013. On Tuesday, it widened slightly to a 75-cent discount. Four months ago, it traded at a $7.50 discount. "The rapid spread contraction may be indicative of a faster-than-anticipated production decline, […]

Posted On : Published By : Tom Whipple
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Why EIA, IEA, and BP Oil Forecasts are Too High

When forecasting how much oil will be available in future years, a standard approach seems to be the following: Figure out how much GDP growth the researcher hopes to have in the future. “Work backward” to see how much oil is needed, based on how much oil was used for a given level of GDP in the past. Adjust this amount for hoped-for efficiency gains and transfers to other fuel uses. Verify that there is actually enough oil available to support this level of growth in oil consumption. In fact, this seems to be the approach used by most forecasting agencies, including EIA, IEA and BP. It seems to me that this approach has a fundamental flaw. It doesn’t consider the possibility of continued low oil prices and the impact that these low oil prices are likely to have on future oil production. Hoped-for future GDP growth may not […]

Posted On : Published By : Tom Whipple
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Disappearing Bakken oil discount adds to output slowdown signs

NEW YORK Oil traders scrambling to secure crude in the U.S. Midwest have pushed North Dakota’s Bakken to a near premium for the first time in two years, a rally stoked by record refinery runs and an unprecedented slump in Canadian imports. Yet some traders say the surprising strength emerging from opaque physical crude markets in the heartland of the fracking boom also points to a more important, lasting factor: declining production of Bakken crude, a long-anticipated but as yet unproven twist in the shale revolution. The buying frenzy pushed Bakken delivered at Clearbrook, Minnesota WTC-BAK, to trade just 35 cents a barrel below the West Texas Intermediate benchmark last week, dealers say, the narrowest discount since July 2013. On Tuesday, it widened slightly to a 75-cent discount. Four months ago, it traded at a $7.50 discount. "The rapid spread contraction may be indicative of a faster-than-anticipated production decline, […]

Posted On : Published By : Tom Whipple
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America’s Shale Oil Boom Grinding to Halt as OPEC Stands Pat

America’s Shale Oil Output is Shrinking The shale oil boom that turned the U.S. into the world’s largest fuel exporter and brought $3 gasoline back to America’s pumps is grinding to a halt. Crude output from the prolific tight-rock formations such as North Dakota’s Bakken and Texas’s Eagle Ford shale will shrink 1.3 percent to 5.58 million barrels a day this month, based on Energy Information Administration estimates. It’ll drop further in July to 5.49 million, the agency said Monday . With the Organization of Petroleum Exporting Countries refusing to curb its own oil production, U.S. shale is coming under pressure to re-balance a global supply glut. Everyone from EOG Resources Inc., the country’s biggest shale-oil producer, to hedge fund manager Andrew J. Hall to banks including Standard Chartered Plc have forecast declines in U.S. output following last year’s plunge in crude prices. The nation was still pumping the […]

Posted On : Published By : Tom Whipple
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Rig numbers in North Dakota recover

North Dakota rig activity increasing, though still far below levels set when oil prices were plummeting. Photo by Christopher Halloran/Shutterstock BISMARCK, N.D., June 8 (UPI) — The number of rigs actively exploring for or producing oil and natural gas in North Dakota recovered from recent lows, state data show. The state government reports 82 rigs in active service as of Monday, up one from Friday and two more than the number reported June 1, which marked a new record low for the state at the heart of the shale oil boom in the United States. North Dakota is the No. 2 oil producer. Oil production in March, the last full month for which data are available, was 1.19 million barrels per day, an increase from the previous month, but 3 percent below the all-time record set in December. State data from mid-March showed 111 active rigs in the state. […]

Posted On : Published By : Tom Whipple
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The EIA’s Drilling Productivity Report

The EIA has released its latest Drilling Productivity Report . There were some interesting data presented in the report. DPR Bakken They say the Bakken peaked at 1,311,703 barrels per day in March and will have declined by 74,763 bpd in July. The EIA says the Bakken will get 51,000 barrels per day in July from new wells but legacy wells will decline by 80,000 barrels per day leaving a decline of 29,000 bpd. DPR Eagle Ford The EIA says Eagle Ford peaked in 1,711,376 barrels per day in March and will have declined by a total of 117,971 bpd in July. The EIA says Eagle Ford will get 90,000 bpd from new wells in July but the decline from legacy wells will be 139,000 bpd leaving a decline of 49,000 bpd. DPR Niobrara The EIA says Niobrara peaked in March at 459,861 bpd and will have declined by […]

Posted On : Published By : Tom Whipple
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The Bakken ”Red Queen” is restrained with more credit

From Rune’s first ‘Red Queen’ post : The reference in the title to The Red Queen from “Alice in Wonderland” by the English author Charles Lutwidge Dodgson (perhaps better known from his pseudonym Lewis Carrol) who was an author, mathematician and logician, is deliberate to create associations with The Red Queen’s statement; "It takes all the running you can do, to keep in the same place" . This post is an update on Light Tight Oil (LTO) extraction in Bakken based upon published data from the North Dakota Industrial Commission (NDIC) as per March 2015. Extraction developments of LTO from Bakken may be followed by county, formation, vintage of wells, and one important source to understand the developments are coming from studying the developments by companies. Holding this up with companies’ financial statements (10-K and 10-Q) is an invaluable source about the companies, their financial capabilities and their strategies. […]

Posted On : Published By : Tom Whipple