We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.
Here is a recap of the North Dakota rig count, all from Million Dollar Way. Also, an article quantifying the impact on employment from the drop in rig count.
Some older data repeated for recent context: Continue reading “Continued drop in count of working oil rigs in North Dakota”
The increase in DUCs, or drilled but uncompleted wells, in North Dakota is getting to be old news. The new word of fracklog has emerged to describe and quantify the number of wells waiting to be fracked before they go into production. Two recent articles and then a graph of the fracklog.
Big headlines recently announced two companies have stopped fracking. This is neither a big story nor a new story.
Previously mentioned the following article which says Whiting Petroleum will stop fracking its wells in the second quarter. This means they will keep drilling but not frack & complete any wells.
Continue reading “The slowdown in North Dakota well completions. AKA fracklog.”
The year and half of effort by Saudi Arabia to shut down the shale industry is finally having a visible impact on production in North Dakota. Average production dropped 30,590 bopd to average of 1,122,106 bopd in January. That is a 2.65% drop in January following a 2.46% drop in December.
I’ve seen speculation that the January output would drop dramatically. Not sure that two and a half percent meets that particular forecast.
January production is down 105k bopd from the high water mark in December 2014. Going to take a reeeeeally long time to clear the 1 million bopd world-wide oversupply at that rate.
Don’t have time to update all my graphs this month, so here is the basic production graph I’ve been tracking:
In December 2015, crude oil production in North Dakota dropped from a slightly revised 1,181,786 bopd in November to 1,152,280 bopd in December, for a 2.50% decline.
Completed well count was 76, which is a substantial drop from the 119 to 123 range in July through September. From August 2011 through December 2014 there were anywhere from 180 up to 213 rigs running. During that time, the average rig count was 192, by my calculations.
Fracklog is 945 at the end of December, which is a drop from the count during August through November but is higher than any month before that. This is the estimated tally of wells that have been drilled to total depth but have not yet been fracked & completed. As a result these are wells essentially held in inventory pending a price increase of oil.
The February Director’s Cut report indicated oil prices continue to drop, hitting $16.50 a barrel, yes under 17 bucks in February. The director’s expectation is for low oil prices to continue through the third quarter of 2016 with further drop in number of rigs in operation.
As you would expect with the dramatic drop in prices, exploration & production companies are cutting back operations. Today’s news making that point:
Bruce Oksol, of The Million Dollar Way, reports on his observations during his frequent trips to Williston. Comments from his February trip, with a few of my comments on his comments:
2/6 – First Day Back in the Bakken – Construction on the bridge across the Missouri seems to have stopped. By-pass on the west side of town is complete. He senses less oil rig traffic, Wal-mart is not as full as during the boom, but still quite busy, and less cars in the parking lots of nicer hotels. Restaurants are busy, but not anywhere like during the boom.
I’ve been going through a backlog of energy articles that I haven’t had opportunity to comment on before. A great article last fall from The Million Dollar Way prompted me to look at what has happened to oil output since prices collapsed.
10/14/15 – The Million Dollar Way – Wednesday, October 14, 2015 – Part IV; Blue Skies – Article is from October. The underlying point stands. Look how little the monthly output has changed even though drilling activity has shrunk.
Here are some stats mentioned for October 15 with prior year numbers:
So production has collapsed, right?
A few articles of interest to me.
1/18 – Energy Media Group at Bakken.com – 5 oil full job still in demand in 2016 – Even with the drop off in drilling, there are five areas in which you can still find a job if you have the skill sets.
Article says those jobs are drivers with CDL, operators, production foremen, drillers, and field technicians.
Keep in mind the comment I’ve seen repeatedly that each producing well creates essentially one full-time job.
1/26 – Bismarck Tribune – Strip clubs receive second reading – The meaning of that headline is that rules to ban strip clubs from the downtown area were considered for the second time by the Williston city commissioners. City rules require considering a motion twice before it is considered approved. Second look at the rule resulted in unanimous approval.
Bruce Oksol wonders whether Bakken oil production is entering the manufacturing phase after a frantic construction phase.
2/3 – The Million Dollar Way – Idle Chatter on DUCs and Related Data Points – Before a big factory or electrical plant or other major project begins production there is a massive construction effort. The number of jobs to run the facility is a fraction of the number of workers needed to construct the thing. When completed, the number of jobs at the facility drops off.
Mr. Oksol uses the illustration of a natural gas plant being built. During construction there will be around 2,000 temporary jobs. When that gas is turned into electricity, the plant will employ 45. That’s 2,000 temporary and 45 permanent jobs.
He wonders if Bakken is like that, having finished the ‘construction’ and now moving into manufacturing.
Continue reading “Bakken entering ‘manufacturing’ stage? Also, count of oil rigs in field.”
A few articles of interest to me over the last two months: baby deliveries increase, airline boardings down, adjustments to low prices continue.
1/15 – Amy Dalrymple at Oil Patch Dispatch – While oil boom has slowed, births still booming – number of births in Williston and my not word a record number last year. The count at Williston’s Mercy Medical Center:
Mentioned Saturday there was a small increase in oil production during November. Here are a few more graphs.
Value of the production is dropping fast due to the world-wide drop in prices. These reflect the discount to allow for transportation costs to the Gulf, East, or West coast.
Continue reading “More graphs showing North Dakota oil production – 1/18”
Production information was released for North Dakota yesterday. In November, production increased to 1,176,314 bopd (prelim) from 1,171,119 bopd (revised). That is an increase of 5,195 bopd, up for a second month. Percentage change is up 0.44%.
A few graphs today and a few more Monday. Here is what the state-wide and Bakken-only production looks like, along with a what-if guess based on average increases having continued.
Sort of looks like a plateau.
Here is the long-term picture of state-wide production:
Continue reading “Oil production in North Dakota increases about half a percent in November ’15”
The Wall Street Journal has a great article on 1/14: North Dakota Cities Use Oil to Regroup / Williston, which saw its population so during the energy boom, sees a chance to catch up after Catholic growth, plan for the future – It highlights all levels of governments are using the slowdown as a time to play catch-up.
Take a look at these indicators of what is going on in the state. Does this look like a collapse to you? Or does this look like a return to something that resembles a normal growth market?
Continue reading “Do conditions in Williston look like a collapse or return to normal growth?”
Here is a recap of the North Dakota rig count, all from Million Dollar Way. Some older data repeated for context: Continue reading “Rig count in North Dakota, update through early January ’16”
Production in the Bakken field of North Dakota dropped 4,140 bopd from October 2014 to October 2014. Going from average output of 1,118,070 bopd a year ago to 1,113,930 in 10/14 is a drop of 0.37%, or about one-third of one percent.
Overall production in North Dakota dropped 14,565 bopd, or 1.23% in the same time.
I don’t think flat production is what OPEC, I mean Saudi Arabia, had in mind when they went for maximum production.
Continue reading “Flat output from U.S. shale in last 12 months is not quite what OPEC had in mind”
Two minor followups, first on the evening soap opera ‘Blood & Oil’ and then a documentary about Williston. Mentioned both of these previously.
In addition to getting the production run cut from 13 to 10 episodes, the drama “Blood & Oil” took a two-week vacation on the schedule during November. I was wondering if the show was even going to finish out the run of 10 episodes.
Well, according to Wikipedia the show finally made it through airing all of the reduced run. Ratings and share has stabilized in the basement with the number of viewers trending down.
Continue reading “Minor followup on media discussion of Bakken”