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Breaking News

by , Posted to on 12/18/2012 1:50 PM | "Quote" | "Quick Reply" |

Joined: 07/12/2003
Location: ND
Latest Prices

Latest Prices

WTI Crude Oil
$87.46 ▲ 0.30%    

Upper Rocky Mountain
Crude Oil Prices:

Colorado SE: $74.60
Colorado Western: $74.13
N.D. Sweet: $70.94
SW WY Sweet: $76.83
Wyoming Sweet: $72.35
 
Spot prices updated Dec. 17
WTI Cushing OK: $87.20
Bakken Clrbrk MN: $84.70
 

Spot prices updated Dec. 17
 

Natural Gas
$3.35 ▼ 0.18%    

Daily Cash Market Prices:

Henry Hub: $3.20
Watford City, ND: $2.76
Malin, OR: $3.33
PG & E City Gate, CA: $3.71
NGPL South TX: $3.18
Northwest WY: $3.19
Transco NY: $3.43
Ventura, IA: $3.23
 
Spot prices updated Dec. 17
 

U.S. Rig Count

1799 as of 12/14/2012
-1 from 12/7/2012
-220 from 12/16/2012                                                                                                                                   

Oilfield Photos
BREAKING NEWS

ND Oil Production Up;
Rigs Down

Even though oil production in North Dakota continued to go up in October, reaching an all time high of 747,239 BOPD, the 2.5% rate of increase was impacted by fewer rigs drilling. The rig count dropped to 188 in October, compared to 218 that were drilling in May.

“Rapidly escalating well costs that consumed capital spending budgets faster than many companies anticipated, and uncertainty surrounding future federal policies on taxation and hydraulic fracturing, are impacting capital investment decisions,” said Lynn Helms, director of the ND Dept. of Mineral Resources.

The current rig count for the state is 182, and projections are that it will increase to 215 by June 2013.

For October, gas production also reached an all time high of 796,042 Mcf a day, but was only slightly higher than September production. “This is largely due to dry gas wells and high gas/oil ratio wells in units being shut in,” Helms said.

The total number of producing oil and gas wells set a new record at 8,025. The NDMR issued 370 drilling permits in October and 211 in November.

ND Residents Support
Oil Industry

A majority of North Dakota residents (89%) favor oil and gas development in the state, a newly released survey said.
At the same time, they are also concerned about truck traffic as well as the cost and availability of housing, according to results of the survey commissioned by the ND Petroleum Council.

“We have seen an increase in the number of residents who strongly favor (55%) oil and gas development,” said Ron Ness, president of the NDPC. “I believe that is an indication that the industry is developing these resources responsibly and with great consideration to the community and landowners in western North Dakota.”

Even though there are concerns about housing and truck traffic, a majority (71%) of North Dakotans believe the benefits of oil development outweigh the risks.

When asked if oil development should also slow down on privately owned land, 76% said no, according to the survey, and 58% said development on public lands should be slowed.

“The industry recognizes that communities in western North Dakota are impacted by the rapid growth brought on by oil development but these survey shows that we are making progress,” Ness said. “By and large, North Dakotans agree that while we do have challenges with our growth, these are good challenges to have, especially in light of high unemployment and a struggling economy nationwide.”

Re: Breaking News
by on 12/18/2012 1:53 PM | Reply #1 | "Quote" | "Quick Reply" |

Joined: 07/22/2002
Location: ND
What happened to Murdock1978??

Re: Breaking News
by on 12/18/2012 1:55 PM | Reply #2 | "Quote" | "Quick Reply" |

Joined: 07/12/2003
Location: ND

Tell you about it at the next fishing derby we hit!!

Re: Breaking News
by on 12/18/2012 1:57 PM | Reply #3 | "Quote" | "Quick Reply" |

Joined: 07/14/2009
Location: ND
aww the temptation  
Life is good.


 2+2=4 

Re: Breaking News
by on 12/18/2012 2:01 PM | Reply #4 | "Quote" | "Quick Reply" |

Joined: 07/14/2009
Location: ND
eyesonly Said:
What happened to Murdock1978??

He is making so much money  in the oilfield it is just like winning the lottery , You go into hiding .   Imagin the beers he would buy if we could catch him at the rafter
Life is good.


 2+2=4 

Re: Breaking News
by on 12/18/2012 2:01 PM | Reply #5 | "Quote" | "Quick Reply" |

Joined: 07/14/2003
Location: ND
US shale gas ignites chemical reaction
Financial Times 12/18/2012
By Ed Crooks
© 2012 The Financial Times Limited. All rights reserved
Articles may not be redistributed or sub-licensed.

page 15
The international chemicals industry is undergoing its most profound upheaval for 75 years, according to the American Chemistry Council.

Not since before the second world war, when there was a flood of discoveries including nylon, synthetic rubber, PVC plastic and polystyrene, has there been technological change with such far-reaching consequences.

This time, though, the change is not in the chemicals industry itself but in the oil and gas business. Advances in horizontal drilling and hydraulic fracturing have unlocked previously inaccessible shale reserves, creating a boom in US oil and gas production that has driven down the prices of the essential inputs for petrochemical making: the natural gas liquids used as feedstocks, particularly ethane.

Those cheap feedstocks are reshaping the global competitive landscape for petrochemicals. Anton Ticktin, of the Valence Group, a specialist investment bank working in the chemical industry, says the US now has "a quite phenomenal advantage".

Costs are already lower in the US than in Europe, Latin America or China. In future, they are likely to be lower even than in the Middle East.

Only three years ago, it looked as though the US bulk chemicals business was in long-term decline. Companies such as Dow Chemical saw their future as investing in the Middle East and moving downstream into more specialised products.

The shale revolution has turned that round, encouraging companies to make plans to invest in new US chemicals production capacity.

Kevin Swift, the ACC's chief economist, says: "This is the place to manufacture chemicals now." The ACC, an industry group, has counted 17 separate projects, either planned or under consideration, to increase capacity in just one process: "cracking" ethane to make ethylene, the building block for plastics such as polythene.

US companies including Dow, ExxonMobil and CPChem - a joint venture of Chevron and Phillips 66 - have been joined by international groups including Royal Dutch Shell and LyondellBasell, both based in the Netherlands, Formosa Plastics of Taiwan, Sasol of South Africa, PTT Global and Indorama of Thailand, and Braskem of Brazil in looking at investments in ethane cracking in the US, and several have already made commitments.

If all of those proposed projects go ahead, Mr Swift says, US ethane cracking capacity could rise by up to 40 per cent by 2018. Ethylene, which accounts for 40 per cent of world trade in chemicals by volume, is a useful yardstick for the industry as a whole, according to Hassan Ahmed, of Alembic, an investment research group.

About half the world's production is based on naphtha, a light liquid hydrocarbon, with the remainder based on ethane and other gases.

Because naphtha is produced from oil, its price is tied to crude. It is today about $100 a barrel, and has risen slightly over the past year.

The price of ethane in the US, by contrast, has collapsed from about 80 cents per gallon a year ago to less than 23 cents today, as new processing capacity has come on stream and US gas producers have shifted the focus of their drilling toward natural gas liquids. US chemicals companies generally accept that the price for their feedstock will have to rise.

"For this thing to work, everybody has to be able to make enough of a return to attract capital, from drilling wells to making products," says Pete Cella, CPChem's chief executive.

Andrew Liveris, chief executive of Dow Chemical, suggests ethane in the "high 30s" of cents per gallon would be a reasonable long-term price. Even with ethane at 40-50 cents a gallon, ethylene will cost about $400-$500 a tonne to produce in the US, Mr Ahmed says, compared with $1,200 a tonne in Europe.

European chemicals companies have been sounding the alarm about the impact of the US cost advantage on their competitive position.

They have also begun to think about US investments of their own. Bayer, of Germany, in June announced an agreement with Aither Chemicals of the US to look at a possible ethane cracker in West Virginia.

Mr Ticktin believes the shale revolution will drive similar shifts in the chemicals industry for years to come.

"We're going to see a lot of merger and acquisition activity, a lot of investment into the US, and a lot of European companies seeking to move downstream," he says.

Even Saudi Basic Industries Corp, the world's largest petrochemical company, is in talks about a possible investment in the US, its chief executive has told the Financial Times.

Although until 2006 chemicals manufacturers in Saudi Arabia were able to sign contracts for very cheap ethane, enabling them to produce ethylene for only about $200 a tonne, it appears that all of the kingdom's production has now been committed.

Increased supplies will require new gas developments, and will not be available at such a low cost.

In time, Europe, Saudi Arabia and China may be able to match US feedstock costs, although efforts to develop their own shale gas are generally making slow progress.

In the US, environmental concerns about hydraulic fracturing may hit gas supplies, and the long-term production possible from shale reserves may be lower than the industry expects. Dow and other chemicals companies also worry that allowing increased US exports of liquefied natural gas could push up prices.

A report commissioned by the energy department argued this month that even if LNG exports were unlimited, the rise in US gas prices would be relatively modest. For now, the competitive advantage of the US looks secure. Mr Cella says: "It won't last forever, but we've got a significant head start."



---------

Analysis: Steelmakers eye gas to cut costs, drive exports


(Reuters) - America's steel industry, for decades a symbol of industrial decline, is betting on natural gas to make it more competitive against foreign producers.

U.S. Steel Corp (X.N) and Nucor Inc (NUE.N), the two largest U.S. steel producers, are changing their traditional manufacturing processes as relatively cheap domestic natural gas supplies become more plentiful.

Some experts believe the new techniques will not only allow steelmakers to cut costs and lower selling prices at home, but also give U.S. companies a chance to compete with Japanese, South Korean and European rivals for a slice of the export pie.

"Gas is very positive for steel; it really lowers the cost of the product," said Michael Locker of Locker Associates, a consultant for steel companies.

U.S. Steel Chief Executive John Surma said in an interview that using natural gas in some stages of production can cut the use of more expensive coking coal by some 10 percent.

He estimated that factoring in costs such as labor, energy and transportation, the overall savings would be $6 to $7 per ton of steel. U.S. Steel produces 23 million tons per year.

Christopher Plummer, managing director of Metal Strategies, an industry consultant in West Chester, Pennsylvania, said the global average cost of producing a ton of steel is about $600 to $700. Russian steelmakers produce at the bottom of the cost curve, averaging about $500 per ton. Americans are in the middle at about $625 to $675 per ton. The most expensive are the Japanese and Koreans, at $650 to $750 per ton.

While a savings of about 1 percent may not sound like much, every little bit counts for companies in an industry that has been struggling with steep rises in raw material costs, such as coking coal, iron ore and scrap metal.

"You do an analysis of our costs and they are much higher than five years ago," said Surma, whose company posted a net loss of $226 million for the fourth quarter -- its fifth in the last eight quarters. "The capital cost to increase our ability to inject greater quantities of natural gas into our blast furnaces is minimal, but the potential savings certainly start to add up when you are producing 20 million tons or more of steel every year."

A GAME CHANGER

With natural gas prices at 10-year lows because new fracking technology has opened up huge deposits in the Northeast United States, most domestic steelmakers are looking to use more of it.

"There is a new focus on natgas," said Larry Kavanagh, president of the American Iron and Steel Institute's Steel Market Development Institute. "Until the recent discovery, we believed coal-based technologies would dominate the future. Now the game has changed in the near term."

Nucor, for instance, has dropped plans to build a traditional blast furnace in Louisiana and instead is constructing a gas-fired plant to produce direct reduced iron, or DRI, a key ingredient in its steel-making process.

The $750 million facility will convert natural gas and iron ore pellets into high-quality DRI used by Nucor's steel mills, along with recycled scrap, to produce 2.5 million tons of steel a year. Like U.S. Steel, Nucor produces about 23 million tons of steel a year. According to Nucor officials, the DRI offers a carbon footprint that is one-third of that for the coke oven/blast furnace, and at less than half the capital cost.

Nucor may be better placed than U.S. Steel to reap the benefits of lower-cost gas because it is a so-called mini-mill operator, which melts recycled steel or pig iron in electric arc furnaces. Electricity is expensive, but costs can be cut by substituting natural gas to fire the furnace. U.S. Steel is an integrated manufacturer that largely makes steel the old-fashioned way, by cooking iron ore and coking coal in a blast furnace. Thus, there is a limit on the amount of natural gas it can substitute for coal.

Nucor has not said how much it expects to save on the cost of a ton of steel by using more natural gas.

Of course, there is no guarantee that natural gas prices will stay low forever; but increases are likely to be more limited than in the past because of the increased production. In the past, prices were volatile and in 2005 were as high as $14 per million British thermal units (BTU), compared with slightly above $2 per million BTU today.

But John Anton, director of steel services for the global forecasting company IHS, said he believes there is little risk that steel companies will get burned should gas prices rise again.

"DRI cannot stand high gas prices; but with fracking technology, we see low prices around $4 lasting for 30 years and under $8 for the next 80 years."

Nucor, which posted a $137 million profit for the fourth quarter, is using a variety of measures to lock in current low prices. President and Chief Operating Officer John Ferriola said the company has long-term gas contracts at its DRI plant in Trinidad with an average cost of about $2 per million BTU.

In addition, Nucor and U.S. Steel are using hedging techniques to protect themselves against potential price rises.

GROWING EXPORTS

Surma said the shift to natural gas could give U.S. Steel, a 110-year-old symbol of American industrial power, a competitive edge in the 21st Century.

Coke prices have risen sharply in the last five years as demand from Asian steelmakers has increased with the China-driven infrastructure building boom.

Although U.S. Steel cannot completely replace coke with natural gas, Surma said the company will try to use gas as much as possible. "We plan to keep pushing the envelope because the economics of gas are just so good," he said.

Steel Market Intelligence analyst Michelle Applebaum said U.S. steelmakers have taken many steps to boost their competitiveness since the 1970s, when they were hobbled by high labor and pension costs and tepid demand. "The U.S. has cut a third of the capacity over the last 30 years to keep the industry alive," she said. "It has made the companies very competitive and the U.S. is very well positioned for exports."

Indeed, U.S. steel exports have recovered to pre-recession levels. The American Iron and Steel Institute forecast exports this year will reach 13.7 million tons, up from 13.45 million tons in 2011 and 9.3 million tons in 2010.

Anton of IHS expects most of the growth to be in Europe and Mexico in the near term. Further out, demand will grow in Asia and Africa. He expects U.S. steel manufacturers to increase their market share at home as well as abroad.

"Overall import penetration into the U.S. is about 20 to 25 percent of steel consumption. We see that falling to the low teens by the end of the decade," he said.

Jim Mahoney, general manager of New Process Steel, a private steel purchaser based in Apodaca, Mexico, said his company buys most of its steel in the United States, Canada and Mexico.

"Steel is a commodity like anything else; it's no different from a consumer choosing where to buy gas (gasoline)," he said. "Once you deal with the issues of convenience and reliability, it comes down to price."

(Reporting By Steve James, editing by Patricia Kranz and Gerald E. McCormick)






 
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Re: Breaking News
by on 12/18/2012 2:19 PM | Reply #6 | "Quote" | "Quick Reply" |

Joined: 07/12/2003
Location: ND
Geothermal Said:
eyesonly Said:
What happened to Murdock1978??

He is making so much money  in the oilfield it is just like winning the lottery , You go into hiding .   Imagin the beers he would buy if we could catch him at the rafter
It may seem like alot of money,but after the state and feds get cut-$24,000.00 in taxes and rafter gets theirs$$$$$???Not much left over....is there somthing wrong with our tax codes???

Re: Breaking News
by on 12/18/2012 2:30 PM | Reply #7 | "Quote" | "Quick Reply" |

Joined: 02/18/2004
Location: ND
Murdock Said:
It may seem like alot of money,but after the state and feds get cut-$24,000.00 in taxes and rafter gets theirs$$$$$???Not much left over....is there somthing wrong with our tax codes???


Yes you are not paying your fair share. I hear they are wanting to tax guys like you in that top 2% at close to 60% level, its only right.

LINDY FISHING





Re: Breaking News
by on 12/18/2012 2:39 PM | Reply #8 | "Quote" | "Quick Reply" |

Joined: 04/22/2009
Location: MT
Murdock Said:
Geothermal Said:
eyesonly Said:
What happened to Murdock1978??

He is making so much money  in the oilfield it is just like winning the lottery , You go into hiding .   Imagin the beers he would buy if we could catch him at the rafter
It may seem like alot of money,but after the state and feds get cut-$24,000.00 in taxes and rafter gets theirs$$$$$???Not much left over....is there somthing wrong with our tax codes???


Isnt the rafter a write off for you oil guys?

I dont go around guessing cup sizes either I just know a nice rack when I see one.

Re: Breaking News
by on 12/18/2012 2:40 PM | Reply #9 | "Quote" | "Quick Reply" |

Joined: 07/12/2003
Location: ND
There must be a crazy amount of tax revenue being paid to the feds and state,from them dam oilfield workers??not counting the fuel tax,sales tax...
Re: Breaking News
by on 12/18/2012 2:43 PM | Reply #10 | "Quote" | "Quick Reply" |

Joined: 07/14/2009
Location: ND
doublebarrelsaloon Said:
Murdock Said:
Geothermal Said:
eyesonly Said:
What happened to Murdock1978??

He is making so much money  in the oilfield it is just like winning the lottery , You go into hiding .   Imagin the beers he would buy if we could catch him at the rafter
It may seem like alot of money,but after the state and feds get cut-$24,000.00 in taxes and rafter gets theirs$$$$$???Not much left over....is there somthing wrong with our tax codes???


Isnt the rafter a write off for you oil guys?


 If he would buy the rafter and hire another half a dozen cute waitresses and give away free beer it would save him a bunch of money.      Hire some of us to spend as much of his money as we can as foolish as we can so there is never a return on the dollar.   He would be money ahead.
Life is good.


 2+2=4 

Re: Breaking News
by on 12/18/2012 2:44 PM | Reply #11 | "Quote" | "Quick Reply" |

Joined: 07/12/2003
Location: ND
doublebarrelsaloon


Isnt the rafter a write off for you oil guys?


Dont know about that,Rafter kick out the smokers,than raised his beer prices...Yeah alot of free loaders think you should by them drinks because you work in the oil field,most of them are democrats!
Re: Breaking News
by on 12/18/2012 2:46 PM | Reply #12 | "Quote" | "Quick Reply" |

Joined: 04/22/2009
Location: MT
Murdock Said:
doublebarrelsaloon


Isnt the rafter a write off for you oil guys?


Dont know about that,Rafter kick out the smokers,than raised his beer prices...Yeah alot of free loaders think you should by them drinks because you work in the oil field,most of them are democrats!
Haha no need to wink when your telling the truth.

I dont go around guessing cup sizes either I just know a nice rack when I see one.

Re: Breaking News
by on 12/18/2012 2:50 PM | Reply #13 | "Quote" | "Quick Reply" |

Joined: 02/13/2006
Location: ND
All those taxes are coming into the state and they are raising property taxes.  The feds are getting a boatload too and still going in the hole.
Re: Breaking News
by on 12/18/2012 2:52 PM | Reply #14 | "Quote" | "Quick Reply" |

Joined: 07/14/2009
Location: ND
doublebarrelsaloon Said:
Murdock Said:
doublebarrelsaloon


Isnt the rafter a write off for you oil guys?


Dont know about that,Rafter kick out the smokers,than raised his beer prices...Yeah alot of free loaders think you should by them drinks because you work in the oil field,most of them are democrats!
Haha no need to wink when your telling the truth.



Haha  I think the wink was just a way to pretend he didn't mean it .   
Life is good.


 2+2=4 

Re: Breaking News
by on 12/18/2012 2:54 PM | Reply #15 | "Quote" | "Quick Reply" |

Joined: 07/14/2009
Location: ND
Enslow Said:
All those taxes are coming into the state and they are raising property taxes.  The feds are getting a boatload too and still going in the hole.

That is like trying to fill a gopher hole with a water picher.  
Life is good.


 2+2=4 

Re: Breaking News
by on 12/18/2012 2:56 PM | Reply #16 | "Quote" | "Quick Reply" |

Joined: 04/22/2009
Location: MT
Geothermal Said:
doublebarrelsaloon Said:
Murdock Said:
doublebarrelsaloon


Isnt the rafter a write off for you oil guys?


Dont know about that,Rafter kick out the smokers,than raised his beer prices...Yeah alot of free loaders think you should by them drinks because you work in the oil field,most of them are democrats!
Haha no need to wink when your telling the truth.



Haha  I think the wink was just a way to pretend he didn't mean it .   
Oh yea, I think both Murdock and myself are very familiar with "uptown interactions". As a matter of fact after work I think I might have a few as well, prolly even get the fellas around me a couple.

I dont go around guessing cup sizes either I just know a nice rack when I see one.

Re: Breaking News
by on 12/18/2012 3:05 PM | Reply #17 | "Quote" | "Quick Reply" |

Joined: 10/18/2006
Location: ND
 Get to work murdo. A train just showed up!!!
Re: Breaking News
by on 12/18/2012 3:20 PM | Reply #18 | "Quote" | "Quick Reply" |

Joined: 02/18/2004
Location: ND
Enslow Said:
All those taxes are coming into the state and they are raising property taxes.  The feds are getting a boatload too and still going in the hole.
My property taxes actually went down just over $400 on the statement that I just received, however my liberal farming buddies just went up by $150 a quarter.... I laughed and told him someone has to pay for that obamacare. Funny how he didnt think it was funny when it was his cash getting confiscated.


LINDY FISHING





Re: Breaking News
by on 12/18/2012 3:42 PM | Reply #19 | "Quote" | "Quick Reply" |

Joined: 12/16/2001
Location: ND
johnr Said:
Enslow Said:
All those taxes are coming into the state and they are raising property taxes.  The feds are getting a boatload too and still going in the hole.
My property taxes actually went down just over $400 on the statement that I just received, however my liberal farming buddies just went up by $150 a quarter.... I laughed and told him someone has to pay for that obamacare. Funny how he didnt think it was funny when it was his cash getting confiscated.


I wonder what's higher?  The taxes he's paid the past 20 or so years or the sum of all the subsidies he's received? 

Re: Breaking News
by on 12/18/2012 3:48 PM | Reply #20 | "Quote" | "Quick Reply" |

Joined: 02/18/2004
Location: ND
gonefshn Said:
johnr Said:
400 on the statement that I just received, however my liberal farming buddies just went up by $150 a quarter.... I laughed and told him someone has to pay for that obamacare. Funny how he didnt think it was funny when it was his cash getting confiscated.


I wonder what's higher?  The taxes he's paid the past 20 or so years or the sum of all the subsidies he's received? 


good point...

LINDY FISHING





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Posted On: 12/18/2012 1:50 PM
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