ConocoPhillips Investor Update shows Niobrara Production at 1000+ BOED

Slide from ConocoPhillips Investor Presentation May 2015

Slide from ConocoPhillips Investor Presentation May 2015

In their most recent Investor Update Package, ConocoPhillips reported that production from their Niobrara wells were now averaging over 1000 barrels of oil equivalent per day (BOED) over a 30 day period.  The company continues to optimize its completion design  and well lateral length.  ConocoPhillips has already realized a 200% increase in cumulative oil production  between the 1st and 4th quarters of 2014 after building on previous increases from 2013.

ConocoPhillps Niobrara oil properties are mainly located around the Lowry Bombing Range and surrounding areas in Adams, Arapahoe, Elbert, and Douglas county, Colorado.

Read the Investor Update Package

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Despite oil slump, one energy company wants to add wells in Colorado

Bill_Barrett_LogoCathy Proctor – Denver Business Journal – June 10, 2015

Bill Barrett Corp. is stepping up its oil and gas operations in Colorado’s Denver-Julesburg (DJ) Basin, with the Denver-based energy company saying Wednesday it would accelerate its plans to drill new oil and gas wells that have “extended reach lateral” bores of about 9,500 feet.

The plans include adding a second drilling rig to its operations in the basin, and expectations of adding 11 new wells to its 2015 plans. That brings the total new wells Bill Barrett plans to drill this year to between 35 and 40.

The new wells probably won’t move the needle too much on the company’s 2015 production, due to the time needed to ready the wells for production, the company said.

Still, the news stands in contrast to months of announced production and capital spending cutbacks by energy companies amid the ongoing slump in oil prices.
Bill Barrett (NYSE: BBG) said it expects its oil production from the DJ to jump 60 percent in 2015, compared to 2014, and rise another 25 percent in 2016.
As far as spending, Bill Barrett said it now expects to spend between $320 and $350 million in capital expenditures this year.

The company said its spending budget would be supported by cash flow, cash on hand and borrowing against its revolving credit facility as well as selling assets and stock.
The company also said Wednesday it had filed a prospectus with the Securities and Exchange Commission announcing it may sell up to $100 million worth of stock over time via an “at the market” offering as needed.

Continue reading story at The Denver Business Journal

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EPA Finds No Widespread Drinking Water Pollution From Fracking

USEPAJeff Brady – National Public Radio – June 04, 2015

The Environmental Protection Agency says it has found no evidence that hydraulic fracturing — better known as fracking — has led to widespread pollution of drinking water. The oil industry and its backers welcome the long-awaited study, while environmental groups criticize it.

“We found the hydraulic fracturing activities in the United States are carried out in a way that has not led to widespread systemic impacts on drinking water resources,” says Tom Burke, science adviser and deputy assistant administrator of the EPA’s Office of Research and Development. “In fact, the number of documented impacts to drinking water resources is relatively low when compared to the number of fractured wells,” he adds.

The EPA’s draft assessment was conducted at the request of Congress. “It is the most complete compilation of scientific data to date,” says Burke, “including over 950 sources of information, published papers, numerous technical reports, information from stakeholders and peer-reviewed EPA scientific reports.”

Continue reading story at National Public Radio

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Nearly Half Country’s Frac Sand Comes From Wisconsin, USGS Says

Producing and Potential Frac Sand and Resin-Coated Sand Source Units in the Conterminous United States - Anna Burack Wilson and Mary Ellen Benson

Producing and Potential Frac Sand and Resin-Coated Sand Source Units in the Conterminous United States – Anna Burack Wilson and Mary Ellen Benson

By Rich Kreme – Wisconsin Public Radio – Friday, May 29, 2015

The U.S. Geological Survey has come out with new estimates suggesting that Wisconsin produced and shipped nearly half of all frac sand used in the nation last year.

Data on frac sand production is tough to come by. The state doesn’t track how much is shipped and companies are leery of sharing their numbers. But a detailed report from USGS is offering one of the most comprehensive looks into the industry. As expected, Wisconsin is king when it comes to frac sand, producing an estimated 24 million metric tons last year. That’s 44 percent of the entire U.S. supply. The nearest competitors were Illinois and Texas, which produced 8 million tons each.

The report also suggests drillers are using up to 5,000 tons of sand to frac a single oil well. That’s more than five times what was used in 2008. The report, though, doesn’t take into account a recent crash in oil prices that has caused demand for sand to drop between 20 and 30 percent.

View the USGS Report:Hydraulic Fracturing (Frac) Sand Sources and Production in the United States

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The Science Behind OK’s Man-made Earthquakes

Earthquake Fault Diagram - Courtesy USGS

Earthquake Fault Diagram – Courtesy USGS

By Ariel Conn, Seismologist and Science Writer with the Virginia Tech Department of Geosciences. May 21, 2015

Rockpick Says: Good Article and worth a read.

On April 21, the Oklahoma Geological Survey issued a statement claiming that the sharp rise in Oklahoma earthquakes — from only a couple per year to thousands — was most likely caused by wastewater disposal wells associated with major oil and gas plays. This is huge news after years of Oklahoma scientists hesitating to place blame on an industry that provides so many jobs.

Now, seismologists from around the country — including Oklahoma — are convinced that these earthquakes are the result of human activity, also known as induced or triggered seismicity. Yet many people, especially those in the oil industry, still refute such an argument. Just what is the science that has seismologists so convinced that the earthquakes are induced and not natural?

Hidden Faults

Over the last billion years (give or take a couple hundred million), colliding tectonic plates have created earthquake zones, just as we see today in California, Japan, Chile and Nepal. As geologic processes occurred, these zones shifted and moved and were covered up, and the faults that once triggered earthquakes achieved a state of equilibrium deep in the basement rocks of the earth’s crust. But the faults still exist. If the delicate balance that keeps these fault systems stable ever shifts, the ancient faults can still move, resulting in earthquakes. Because these inactive faults are so deep, and because they can theoretically exist just about anywhere, they’re incredibly difficult to map or predict – until an earthquake occurs.

Thanks to historic reports of earthquakes in the central and eastern United States, we know there are some regions, far away from tectonic plate boundaries, that occasionally experience large earthquakes. Missouri and South Carolina, for example, suffered significant and damaging earthquakes in the last 200 hundred years, yet these states lie nowhere near a plate boundary. We know that fault zones exist in these locations, but we have no way of knowing about dormant faults in regions of the country that haven’t experienced earthquakes in the last couple hundred years.

Continue reading at FracTracker Alliance

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‘Shale-ionaires’ Suffering from Wave of Bankrupt Oil Drillers

EIA Map Showing 7 most prominent shale plays

EIA Map Showing 7 most prominent shale plays

by Kelly Gilblom – Bloomberg News – May 20. 2015

At the height of the U.S. energy boom, Texas landowner John Baen received about $100,000 a month in royalty payments from companies producing oil and natural gas on his property.

Now the checks are much smaller, and when he opens his mailbox each day, he’s afraid he’ll find yet another bankruptcy notice. So far, four of the producers sending him checks have caved in to rising debts as oil prices slumped, seeking court protection from their creditors.

“I feel like crying because I know I’m going to get another 10 notices,” said Baen, 67, who owns 10,000 acres of land and mineral rights on other property.

A rebound in oil prices that bottomed near $44 a barrel in March has provided some relief to stronger companies that have been able to compensate with cost cuts and more efficient operations. For many smaller, cash-strapped producers, current prices of almost $60 still aren’t enough to make ends meet compared to the $100-plus prices seen during the boom days.

West Texas Intermediate crude, the U.S. benchmark grade, gained 74 cents to $59.72 a barrel in electronic trading on the New York Mercantile Exchange at 11:47 a.m. London time.

There have been at least a dozen bankruptcy filings in recent months, and more than a dozen have defaulted on bond payments or warned investors of challenging times ahead, according to data compiled by Bloomberg. Continue reading “‘Shale-ionaires’ Suffering from Wave of Bankrupt Oil Drillers” »

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Toxic vapors suspected in deaths of three Colorado oil and gas workers

CrudeOilTankBatteryBy Monte Whaley – The Denver Post – May 18, 2015

Joe Ray Sherman’s death on a Weld County oil patch last year was tragic but not entirely unexpected.

The 51-year-old was diabetic and suffered heart problems. The native Texan moved to Colorado 20 years ago in hopes that the clear, mountain air would get him healthier.

The Weld County coroner confirmed what many believed, ruling his death while servicing one of the county’s oil wells was caused by heart disease.

But his March 2014 death soon became part of a mysterious puzzle that the Centers for Disease Control and Prevention is piecing together along with eight other oil field deaths over the past five years.

All of the fatalities occurred at crude oil production tanks, and all the victims were either working alone or weren’t being observed by anyone. Most of the death certificates listed natural causes or heart failure as the cause.

Three of the deaths were in Colorado, three more in North Dakota and one each in Texas, Oklahoma and Montana.

By late April, federal health officials had enough evidence to sound a national alarm over a dangerous trend in America’s oil fields. The men died after inhaling toxic amounts of hydrocarbon chemicals after either tank gauging — measuring the level of oil or other byproducts in tanks coming out of wells — or from taking samples of oil for more testing.

Continue reading story at The Denver Post


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Get ready for another oil price dip: Goldman Sachs

oil-drop-dollarsign – CNBC – Tuesday, 12 May 2015

The rally in oil over the last couple of months has derailed a rebalancing of the commodity’s price and will cause it to weaken, Goldman Sachs warned Tuesday. (Tweet This)

“We believe that the recent price rally is premature” the investment bank’s commodities team, led by Damien Courvalin, said in a note published Tuesday morning.

“Prices need to sequentially weaken, to resume the oil market rebalancing as well as help correct the still intact imbalance of too much capital looking for opportunities in the energy space.”

The price of oil collapsed from near-$120 a barrel in June last year to lows of around $45 a barrel in January, although it has since bounced back to around the $60-a-barrel level. Analysts are now contemplating oil’s “new equilibrium,” with a slew of market watchers predicting that prices could climb to around $70 before the end of the year.

However, Goldman Sachs said the price may have gotten ahead of itself and warned that oil was now trading at a premium compared to to its own “still weak fundamentals.”

These weak fundamentals include rising stockpiles of oil, it explained, and production growth is expected next year from low-cost producers such as Saudi Arabia, Iraq and Russia.

Added to this, Courvalin and his team said that the decline in the number of operational rigs in the U.S. wouldn’t be large enough to put production on a “persistent downward trend.” Meanwhile, U.S. producers are expected to ramp up production again if the WTI price settles above $60 a barrel.

Nonetheless, Goldman Sachs accepted that this “sequential decline” might not begin until later in the year.

Continue reading story at CNBC

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