Production of oil in North Dakota has been shooting up. Prices have dropped recently. What does that look like in terms of the value of oil produced?
Multiplying the monthly production by the average sweet prices in the state results in the following estimated value of monthly production in the state:
There is a discount in sweet crude prices in the state compared to West Texas Intermediate due to transportation cost. The prices realized in North Dakota are:
Average production rose 5.2% in September 2018, hitting a new record, then rose another 2.4% in October for another record level. The production in October was just under 1.4 million bopd.
At the end of 2017, production was 1,182,836 ave bopd. In September average was 1,359,284 (final) and October was 1,391,877 (prelim).
Some production graphs – – –
Statewide and Bakken shale production has been trending up sharply. Last winter’s lull is quite visible. The output curve is starting to take on the rapid growth angle visible back in 2012 and 2013.
For a longer term perspective, check out the average daily production since 1990:
Primary mode of transportation to be used by major players in Silk Road drug bazaar for many years to come. Image courtesy of Adobe Stock.
While looking at the sentencing of former Secret Service agent Shaun W. Bridges I learned a few more details of what he was up to while looting hundreds of thousands of dollars worth of bitcoins. His sentencing is one of the loose ends on my posts about the Silk Road dark web site where you could buy any drugs, body parts, contract hits, weapons, explosives, or fake identification that your heart desired.
This guy had quite a career. Seriously. He was a successful hostage negotiator before joining Secret Service. He was on the Obama presidential protection detail and was a cyber currency expert while at the USSS.
View of Mr. Bridges neighborhood for seven years. Image courtesy of Adobe Stock.
One more loose end on my reporting of the drug/body parts/contract hit/weapons/fake ID/explosives dark web site Silk Road: sentencing for Shaun W. Bridges.
Update: After getting ready for followup to this post, I realized those are actually separate discussions. Thus, there will be no ‘part 2’ for this post.
He is the former Secret Service agent who, while assigned to the inter-agency task force investigating Silk Road, stole a large amount of bitcoins. He was sentenced to prison for 71 months.
The day before he was scheduled to report to prison he was trying to get out of the U.S. but was arrested for another theft of Bitcoins. He pled guilty and was sentenced to another 24 months, which the judge ordered to run consecutively.
He was also ordered to surrender 1,500 bitcoins, which were worth approximately $10.4 million at the time of his sentencing.
This post will discuss his sentencing. Next post will give some more background on his escapades which paid him a well-earned seven years in free federal housing.
Expected long-term housing arrangements for ‘Variety Jones.’ Image courtesy of Adobe Stock.
There are only a few loose ends on the massive on-line drug bazaar called Silk Road. Actually, you could buy weapons, human organs, explosives, and even a contract killing on the site along with any amount of any dope you have ever heard of.
Most of the players are in federal prison on long-term sentences.
Last time I checked, the remaining on-the-loose player was “Variety Jones.” He is now in custody, awaiting trial.
Let’s look at the drilling and completion work driving the rising levels of production.
Keep in mind that the drastic improvements in productivity has decoupled the number of drilling rigs from the number of wells drilled.
Also keep in mind the ‘fracklog’, or the number of wells in the backlog of wells that have been drilled but not yet completed. In essence, wells are drilled and then left in inventory. When the expectations of prices are right and there are completion crews available, production companies can quickly complete a well and get it into production.
The number of drilling rigs in the field dropped dramatically during 2015. Since the fall of 2016, the count has slowly risen, with a noticeable pickup in the last five months:
The number of wells awaiting completion, the ‘fracklog’, has been increasing slightly over the last year but dropped over the last two months:
In August the crude oil production in the state hit an average of 1,291,496 barrels of oil per day (bopd). As always, that is the preliminary tally, which will change when a few late reports arrive.
The record high before a several year slump was an average 1,229,572 bopd in December 2014.
In the last five months there have been three record highs with two months barely under the 12/14 record.
Here is my graph of production state-wide and Bakken only (including Sanish, Three Forks, and Bakken/Three Forks levels). Notice the steady increase over the last few months and a strong rise since winter of ‘16/’17.
For a far longer perspective, look at the average production data since 1990. I like this graph because it shows a pattern of explosive growth from about 2008 through late-2014, a drop until around the end of 2017 and a rapid growth since then. The longer view:
Transatlantic travel time has dropped radically in the last 500 years. Time to transit the Atlantic has dropped about 99% and cost has dropped about 95% by my calculations.
Let’s look at several data points for cost and time, then calculate one indicator of improved quality of life.
Update: Added in travel time of Concorde at end of the post.
Columbus’ first trip
The 1492 trip by Christopher Columbus took two years of lobbying before the king and queen of Spain approved 2 million Spanish maravedis to fund the trip. A professor has calculated that would be comparable to about US$1,000,000 today.
The cost seems low to me. I’ll look at that more later.
Crew size was 87 according to this article. The accountant in me is driven to calculate the cost per crewman. That would give an average cost of $11,494. I’ll round that to $11,500 and ignore any adjustment for several crew members who died on the trip.
His trip took two months, nine days, which I calculate at 70 days (30+31+9).
Multiple pumpjacks on a well pad is a normal thing in North Dakota. Photo by James Ulvog.
In May the crude oil production in the state hit an average of 1,244,629 barrels of oil per day (bopd). As always, that is the preliminary tally, which will change a bit over the next two months as a few late reports arrive.
That is 15,057 bopd higher than the previous record of 1,229,572 bopd in December 2014.
Here is my graph of production state-wide and Bakken only (including Sanish, Three Forks, and Bakken/Three Forks levels):
For a longer term perspective, here is the total monthly production since 1990:
Fourteen wells are on that pad, which is on the south side of Williston near the Missouri River. Photo by James Ulvog.
Previously discussed the near-record level of oil production in the state during April. Here is the graph of average daily production since 2004:
What is the value of that oil? Multiply those average daily production levels by days in the month and then multiply by the following average sweet crude prices in the state:
There is space for more than 6 pumps on that site. Might be as many as a dozen when fully drilled. Photo by James Ulvog.
In April crude oil production in the state hit an average of 1,224,948 barrels of oil per day (bopd). That is the preliminary tally, which will change a bit in the next report as a few late reports arrive.
That is really close to the record high of an average 1,229,572 bopd in December 2014. Another 4,624 per day would get the state to a new record. That could be achieved for April by late reports from the field. Or, since production increased 42,112 bopd since December, the May data will likely break the record.
Here is my graph of production state-wide and Bakken only (including Sanish, Three Forks, and Bakken/Three Forks levels):
For more background, here is the total monthly production since 2004:
An F-16 Fighting Falcon joins in formation with a P-40 Warhawk (front), P-51 Mustang (bottom), and an F-86 Sabre (top) during the Heritage Flight Training Course March 2, 2014, over Davis-Monthan Air Force Base, Ariz. (U.S Air Force photo/ Airman 1st Class Cheyenne Morigeau)
The Department of Defense has established reimbursement rates for the airplanes and helicopters in the military inventory. If I’m reading this right, these are the hourly rates for reimbursement when an aircraft or helicopter is loaned out.
This seems to be usable as an estimate for the operating costs of airplanes. I previously discussed Operating costs per hour for USAF planes. This post provides more detailed descriptions.
There are separate rates for loans to another US military organization, other federal agencies, and two other categories I don’t understand (FMS and All Other).
Sure would be fun to put together a tongue-in-cheek conversation for which these rates would be used (Short outline: British Defense Minister: “Say old chap, we’re putting together a strike in our little squabble and we’d like to borrow two flights of Strike Eagles and a half-dozen tankers for a couple of days. Can you do that and what’ll the tab be?” U.S. Secretary of Defense: “Sure, for you, no problem. Um, yeah, we have the resources available. Hold on a second while I look up the list price.”)
More seriously, I’m guessing this provides a simple way to calculate the dollar amount of assistance we provide our allies, say the French need air transport to land a brigade of troops in Africa to deal with a new round of shooting in a civil war, like in Mali or Central African Republic. Or, say we provide refueling for the superb fighters of our French and British allies while all three of us launch a coordinated air strike in Syria.
Anyone care to share your guesses on how these reimbursement rates would actually be used?
B-52D at March Field museum. Photo by James Ulvog.
Reimbursement rates
On a practical basis, this reimbursement table provides a frame of reference for the operating costs of U.S. airborne resources. The rates are broken out between operating and maintenance (O&M) and personnel costs (MilPers) on tab F2. That likely approximates the hourly operating costs and the hourly compensation for a standard crew.
Notice all the empty space on that pad? Notice the disproportionately high number of storage tanks for the number of pumpjacks on site? One day there will be a lot more wells in operation. Photo by James Ulvog.
Before showing the average daily production, annual production, and value of that production, just a note on December 2017 production.
Average daily production dropped from 1,196,976 bopd (revised) in November to 1,181,319 bopd (preliminary) in December, a decline of 15,657 bopd, or 1.31%.
Here is what the average daily production by year looks like. Notice the recovery in 2017?
What a treat it must have been to watch from miles away.
Using special stereo mikes, the recording catches the clicks of many nearby cameras before being overwhelmed by the rocket sounds.
Listen carefully for the multiple sonic booms from the boosters returning to earth. Each booster gives off a boom from the engines, then the landing legs, and then the directional control arms. So 6 booms expected. Sound track wave form shows echos, but one overlapped, so there were 5 booms from each booster.
Astounding, all the way around.
Also Behind the Black provided Update on Falcon Heavy core stage landing failure. Turns out that two of the three engines scheduled to fire, slowing the descent, did not do so. Core booster missed the landing barge by around 300 feet.
BtB says this is why one runs experiments. Find out what doesn’t work, figure out the reason, and fix it.
