Jim Ulvog – Page 27 – Outrun Change

OPEC is still in a jam and a few of the reasons why.

14 wells on one pad. That would be 14 of the thousands of reasons OPEC is in distress. Photo by James Ulvog.

The scheduled production cuts from OPEC are nearing the expiration date as oil prices drop further. Why are they in such a difficult position? Photo above illustrates 12 specific things contributing to their discomfort.

Some articles describing their troubles and why the troubles won’t be going away anytime soon:

5/3/17 – Wall Street Journal – Oil Forecast to Fall Sharply if OPEC Doesn’t Extend Production Cuts – Article says the oil market has priced in an extension of the OPEC production cut. If correct, that means oil prices will fall if the production cut is not extended during meetings this month.

Article has a graph showing forecasts from 14 banks of their guesses on oil prices through the end of the year. For 4th quarter, the estimates range from mid-$40s to almost $70, with most of the estimates in the high $50s or very low $60s.

Article speculates that without an extension, price could drop into $40s.

5/5/17 – Bloomberg – OPEC Runs Out of Options as Bid to Boost Oil Price Fizzles – Article says the OPEC producers have kept to their agreed upon production cuts. That pushed prices up for a while but now prices are back to where they were when the cuts were announced.

Continue reading “OPEC is still in a jam and a few of the reasons why.”

“Magic without wizards”, or, why is your favorite bread on the shelf when you want it?

Consider merely the way that your favorite bread is always available, usually from many bakeries. And at the time you want. The bakery doesn’t know whether you will stop in on your way to work, during lunch, or after having dinner.

How can it be that several bakeries know to have your choice of bread available, whether sourdough loafs, whole wheat biscuits, rye rolls, croissants, or cranberry bagels? How did they know to order enough yeast, oil, and flour? How did they know what mix to bake before the sun came up?

How did the wholesalers know enough to deliver the right amount of flour to all the pizzerias, bakeries, and pastry shops?

How did the farmers know enough to plant the right amount of wheat, oats, barley, and rye last spring to harvest enough this fall to satisfy all those bakers?

Hmm. What could be getting all those people working together to make sure my favorite and your favorite bread is available when you or I want it?

Ponder these and many more questions just in terms of having bread on the shelf in this video, called “It’s a wonderful loaf:”

[youtube=https://youtu.be/ljULutAUL7o?t=33]

The answer of how all that happens is readily available for all who want to find it.

Continue reading ““Magic without wizards”, or, why is your favorite bread on the shelf when you want it?”

Saudi Arabia still in financial trouble, reverses salary and benefit cuts

Saudi Arabia and OPEC are still in trouble.

Just a few of the articles making that point lately:

Is OPEC near an end?
Saudi Arabia reverses course on salary and subsidy cuts
Continued drain of foreign reserves

3/31/17 – Oil Price – The End of OPEC is Near – Author Rakesh Upadhyay defines a cartel as:

…a group of like-minded producers, who act in concert—or collusion—to achieve a shared goal of increasing their profits by means of restricting supply, fixing prices, or destroying their competition by illegal means.

Article provides a history of OPEC’s efforts to control oil prices over the decades and then gives a recap of last few years.

OPEC tried to take out American shale drillers in 2014. Prices dropped further than they expected. Over 100 US producers went BK. US output dropped from 9.7M bopd to 8.9M bopd.

However, the drillers that survived developed more economical, more productive, and more effective techniques. Huge numbers of driller survived.

So, taking out US shale drillers didn’t work.

Thier next step? (Which also didn’t work?)

Continue reading “Saudi Arabia still in financial trouble, reverses salary and benefit cuts”

More progress in the open frontier of space exploration, courtesy of the free market

SpaceX SES 10, recovery of Falcon 9 booster. Credit Flickr. Courtesy of SpaceX.

The number of private sector players involved in space exploration and the progress underway is astounding. Here are a few recent articles catching my attention:

3/20/17 – Investor’s Business Daily – There’s a New Space Race On, Courtesy of Elon Musk, Jeff Bezos And The Free Market – The main point of the article, which is barely starting to be noticed:

Space remains the final frontier. And it will be private sector entrepreneurs, not government bureaucrats, who will take us there.

Article gives a summary of the private sector companies, funded by filthy rich guys who choose to pour their wealth into space exploration, that have expanded our reach into space. According to the article, these companies have done more than NASA has in the last several decades.

Consider:

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Graph of daily rig count in North Dakota

Training rig in Williston. September 2015 photo by James Ulvog.

I’ve been watching the tally of daily rig count for a while. When I think about it, I jot down the count listed at The Million Dollar Way blog. Occasionally, as in every few months, I post my tallies.

By the way, if you have even the slightest interest in my comments on my blog you really, really, really need to read MDW.

Decided to put all that data into a graph to help me see the trends from another direction. So, I combined all the data that has been accumulated haphazardly over time and put it in a graph.

If it helps you see some patterns, I’ll share my graph.

Keep a few things in mind:

The data is accumulated when I think of jotting it down, so this is not a complete database
Don’t read anything in to the gaps in data
Data hasn’t been double-checked, so there are likely inaccuracies
This shows general trends
The efficiency of drilling and total output from a well has improved radically in the last few years so data is not comparable over long terms

Having undercut my data and graph, here is a picture of the rig count in the state:

Continue reading “Graph of daily rig count in North Dakota”

An illustration of the horrible economics of residential rooftop solar power

Wealth transfer to wealthy under construction. Image courtesy of Adobe Stock.

Robert Bryce explains in an editorial at the Wall Street Journal on 4/18/17 the lousy economics of rooftop solar panels: Thanks for Giving Me Your Tax Money.

Mr. Bryce appreciates each of us for giving him our money. Of course, it was done through the tax system so it wasn’t much of a gift. Anyone who did not go along with funding his lark would have to spend some time in jail.

He explains he installed a 8,540 watt solar system on his roof. That means the 28 panels generate 301 watts each.

I have been wanting to see financial results from an actual rooftop installation. Mr. Bryce provides a set of actual numbers.

Here is the breakdown of the actual cost:

$7,758 – federal tax subsidy
6,593 – subsidy from city owned utility
18,100 – his out-of-pocket costs
32,451 – total cost

That means you and I covered 44% of the cost.

He says his system is generating about 12 ~~mWh~~ MWh of electricity a year.

Hmm. That would be about 32.9 kWh a day. For a system with 8,540 watt capacity, the potential, or faceplate capacity is 205.0 kWh each day. So what’s the capacity production on his system?

Continue reading “An illustration of the horrible economics of residential rooftop solar power”

More amazing news from the open frontier of space

Atlas V lifts Cygnus supply ship to ISS. Credit: United Launch Alliance. Used with permission.

It is astounding to ponder the news from the wide open frontier of space. I’m continually amazed by what is happening.

3/7/17 – Space News- NASA seeks information on commercial Mars payload service – NASA issued a Request For Information asking for plans to provide cargo runs to Mars. They are looking for outline of plans in terms of payload mass and weight, nature of vehicle, and timing for start of operations. The RFI indicates 2020 as a start date.

Two companies are described in the article as likely players in Mars cargo runs.

SpaceX would use their new lander Red Dragon as testbed for cargo vehicle. Launch was scheduled for 2018 but has slipped to 2020.

Mars One also has plans for a lander, as an intermediate step for crewed travel. First launch was planned from 2018 but that is now looking like 2022.

3/14 – Behind the Black – SpaceX wins another Air Force launch contract – Ticket price to launch a GPS satellite is $96.5M, up by $14M from the last launch by SpaceX for USAF. Post speculates SpaceX is trying to improve their margin by undercutting ULA less this time around.

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Freedom continues to evaporate in Venezuela as misery continues to increase. Hmm. Why do those two trends typically seem to accompany each other?

What economic system produces this result? Image courtesy of Adobe Stock.

Ponder what economic system produced this suffering, misery, and loss of freedom.

4/19/17 – Wall Street Journal – Venezuela Antigovernment Protests Turn Deadly – Teargas and gunfire broke up widespread protests on Wednesday.

The death toll rises. Two dead on Wednesday with many more surviving gunshots they received. Seven dead in the last month. Forty-two dead in 2014.

Shooting protesters after stealing all their guns is just how authoritarians and totalitarians tend to roll:

4/19/17 – Washington Free Beacon – Socialist Venezuela Leader Steps up Arming of Supporters After Outlawing, Confiscating Civilian Guns – The government has spent the last five years confiscating guns from private citizens. That’s what authoritarian, totalitarians, and other bad governments do.

Why?

So they can’t defend themselves.

From what might individuals need to defend themselves from?

Continue reading “Freedom continues to evaporate in Venezuela as misery continues to increase. Hmm. Why do those two trends typically seem to accompany each other?”

Volume and value of oil production in North Dakota for the last several years

Where you see one well today, eventually there will be 4 or 8 or 12. That concept and the above photo are yet more illustration of why Bakken, Eagle Ford, and Permian Basin, are strategic threats to OPEC. October 2013 photo by James Ulvog.

Let’s look at some longer term graphs of oil production in North Dakota and the value of that production. Here is a view of the annual oil production in the state:

The fascinating insight from that graph is production did not drop in 2015.

Continue reading “Volume and value of oil production in North Dakota for the last several years”

Swings in oil prices and rig count in North Dakota

There is enough untapped oil under the ground for a whole bunch more of those rigs to work in North Dakota. October 2013 photo by James Ulvog.

If you want to see one graph that explains the swings of drilling and oil production in North Dakota, take a look at this:

The price of oil for producers in the state collapsed in late 2014 due to the OPEC decision to increase production. The price recovered a bit in mid-2015 but continued to drop into the 20 something range.

The price has been steadily trending up, albeit slowly, since mid-2016.

That graph can then explain a lot of other trends.

For example, look at the count of average rigs in operation. The tally dropped dramatically in 2015. It has slowly been recovering since fall of 2016.

Continue reading “Swings in oil prices and rig count in North Dakota”

Oil production in North Dakota up 5% in February 2017

Illustration why Bakken and Eagle Ford are a strategic threat to OPEC. Photo by James Ulvog.

Oil production in North Dakota increased 5.38% in February to 1,034,168 bopd (preliminary). This follows a 4.14% increase in January. Two large changes in earlier months were an 8.91% drop in December 2016 and a 7.31% increase in October 2016.

I’ve not posted my usual graphs for a few months. Will get caught up in the next few days.

Here is a graph of average daily production, both state-wide and Bakken-only:

Here is a longer term view, with average daily production since 2004:

Continue reading “Oil production in North Dakota up 5% in February 2017”

Initial reports for solar panels embedded in road. Well, actually, a walkway. Output worth around a nickel per day.

A prototype of solar panels installed in roads is being tested. Results are not particularly promising. (Similar story could be told of two projects in Europe, but will have to cover that another day.)

10/18/16 – Daily Caller News Foundation – Solar Road is “Total and Epic” Failure, 83% Of Its Panels Break in a Week – The test project is in Idaho. The concept is that 30 panels installed in a street (actually a walkway so the panels are not actually getting the wear of being in a road) will provide enough power to run a water fountain and the lights in a restroom.

Eighteen panels were DOA. Another five panels failed after a rain shower. Not a hail storm. Not an unseasonal torrential rain. Not a blizzard, as happens often in northern locations. Like Idaho.

A shower.

Article says only 5 of the 30 panels were working at the time.

Continue reading “Initial reports for solar panels embedded in road. Well, actually, a walkway. Output worth around a nickel per day.”

More amazing news from the open frontier of technology

A few more of the amazing things going on in the open frontier of technology:

USAF experimenting with anti-drone shotgun rounds that would snag a drone
One state considers allowing police to put lethal weapons on drones
Amazon building 7th and 8th fulfillment center in Southern California
Amazon starts collecting sales tax in last four states it doesn’t already do so
2 terrabyte flash drive
computers as smart as humans by 2029 instead of 2045?

3/13 – The Drive – U.S. Air Force Buying Special Drone-Snagging Shotgun Shells – USAF has 600 special 12-gauge rounds on order for testing. If the test goes well, they will buy 6,400 more.

The rounds are used for snagging a drone.

Continue reading “More amazing news from the open frontier of technology”

Recent counts of drilling rigs in North Dakota

Drilling rig at dawn. Photo by James Ulvog.

The count of drilling rigs in operation across the state has shown strong increase since fall ’16.

Here is a recap of the North Dakota rig count, all from Million Dollar Way. It has been a while since I posted an update.

Keep in mind that the dramatic increase in productivity and production per well means that the number of rigs isn’t anywhere near as important as it was several years ago. At the same time, the count of rigs is still one indicator of activity. Perhaps the long-term trends aren’t important while the shorter term trends are.

Keep in mind I gather data when I think to make notes on the count. Also, I haven’t double checked the numbers, so there very well could be some errors.

Continue reading “Recent counts of drilling rigs in North Dakota”

The space competition heats up. Aaaaand some competitors slow down.

SpaceX SES-10. Credit Flickr. Courtesy of SpaceX for placing photos in public domain.

The competition to be a commercially competitive space launch provider gets far more serious with SpaceX successfully launching a reused Falcon 9 booster to get SES-10 into a geosync orbit.

On the same day as SpaceX made such tremendous progress, two competitors dropped further behind.

Competition speeds up

SpaceX SES-10. Credit Flickr. Courtesy of SpaceX.

I was so fortunate as to check my Twitter feed as SpaceX began its live coverage of the launch. It was such a joy to watch the successful launch and an even bigger thrill to see Main Engine Cutoff, which meant the reused booster did its job.

Continue reading “The space competition heats up. Aaaaand some competitors slow down.”