October 18, 2019 -- From Canada to Mexico
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North Dakota Lt. Gov. Brent Sanford (center) poses with mayors attending the Ports-to-Plains Conference in Williston. Mayors left to right are Mike Dafney, Alliance NE; Howard Klug, Williston; Lyn James, Bowman; Roberto de los Santos, Acuña, Coahuila, Mexico; Bruno Lozano, Del Rio TX; and Ernest Sanchez, Clayton NM.
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Another Record for ND Oil and Gas
Natural Gas Capture Rates are Improving
North Dakota set new records for oil and natural gas production in August, with total crude production approaching 1.5 million barrels per day.
“We set new records almost everywhere so I’d have to say almost everything is in the positive,” said Lynn Helms, director of the North Dakota Department of Mineral Resources, during a monthly news conference to announce the production numbers.
August crude production totaled 45.8 million barrels, or 1,477,394 bbl/day, up 2.2 percent from the July figure. Natural gas output for the month also hit a new all-time high topping three billion cubic feet per day for the first time in North Dakota history.
Click
here to listen to Helms’ comments on the new natural gas production record.
Producers were able to capture and process a total of 75.5 BCF of natural gas during the month thanks to new processing capacity coming online (see story below). The 2.435 BCF/per captured is a new record high, although the capture rate of 81% is still well below the current 88% target.
Click
here for Helms’ comments on natural gas flaring.
The exception to the positive report was a decrease in rig count, mostly due to relatively low oil prices.
“Oil prices have just been a real struggle the last one or two months,” Helms said. “If oil prices were five dollars higher, I think we would see some really robust activity." He added that a slowdown in global economic growth is a big challenge facing oil price improvement.
Click
here for Helms' comments on the factors influencing oil prices.
Helms said North Dakota oil tax revenue projections are based on a slightly higher price point than producers are currently realizing, but “fortunately, production is a good 10% above the forecast so state revenues are fine because we saw production growth."
During the news conference Helms was asked about the impact of WDEA's Wise Roads weather station project to provide weather data that allows road managers to better monitor conditions on rural gravel roads to minimize restrictions that temporarily shut down oil industry trucking activity.
Click
here for Helms' comments on Wise Roads' impact on road restrictions and frost law policy.
Click
here to read the full Director’s Cut.
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WDEA Hires Wise Roads Meteorologist
The Western Dakota Energy Association has added the services of a professional meteorologist to its staff to manage and maximize the value of the association's Wise Roads weather station project.
Jonathan Rosencrans joined WDEA in September following a stint with the North Dakota Agricultural Weather Network, which is partnering with WDEA on the project.
Phase One of the Wise Roads project was completed in late June, placing 10 research-grade weather stations in Dunn, McKenzie, Mountrail and Williams Counties. The four counties collectively account for nearly 95% of the state's oil production. The stations provide weather data to road managers to help them better gauge when rain-related weight restrictions are warranted. Work is now underway on Phase II of the project, which will place 15 more stations in the oil-producing counties this fall.
"Jon has jumped in with both feet, helping us identify the best sites, ordering and testing the equipment, and he's now in the process of contacting landowners for permission to place the next round of stations," said WDEA Executive Director Geoff Simon.
Rosencrans is a native of Powers Lake, giving him a strong working knowledge of western North Dakota. He holds a bachelor's degree in Atmospheric Sciences, graduating summa cum laude from the University of North Dakota. Jon can be contacted at
jonathan@ndenergy.org.
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Gas Flaring Reductions Becoming Reality
More Processing Plant Capacity Makes Difference
Two natural gas processing plants came online in August helping to reduce flaring and leading to a new record for gas captured.
Work was completed on the expansion of the Arrow Field Services plant which grew from a processing capacity of 30 million cubic feet per day (MMcf/d) to 150 MMcf/d. The other facility to come online in August was the LM4 plant by Hess Midstream and Targa Resources which brought on an additional 200 MMcf/d of processing capacity. Combined investment of these two plants was nearly $350 million.
Justin Kringstad, director of the North Dakota Pipeline Authority, said that seven additional natural gas processing plants are on the radar, with two of those scheduled to come online yet in 2019. According to Kringstad, one is ONEOK's Demicks Lake plant with a capacity of 200 MMcf/d and an investment of $405 million. The other plant expected to start processing yet this year is the Kinder Morgan Roosevelt plant with a capacity of 150 MMcf/d and an investment of $355 million.
“All seven units still in the cue to come online equate to about 1 billion cubic feet of additional natural gas processing capacity and roughly $2 billion in investment,” Kringstad said.
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Company Wants to Develop Salt Caverns
Storage Would Support Petro-Chemical Industry
If North Dakota is to be successful in attracting the petro-chemical industry, the state will need space to store the natural gas liquid feedstocks for the manufacturing process. That's why a Canadian company is planning to see if it's possible to develop salt caverns under the state's landscape.
ATCO Energy Solutions Ltd., a company based in Calgary, Alberta, received a positive recommendation this week from the ND Oil and Gas Research Council to fund a study to determine the feasibility of developing salt caverns for hydrocarbon storage in western North Dakota.
Jennifer Rumas, senior advisor with ATCO, said the company currently operates 10 caverns in Albert's Industrial Heartland that support the petrochemical industry there (see related stories in
September 20 and
August 9 newsletters). She said the caverns store natural gas liquids, ethylene, propane and butane, as well as natural gas for peak shaving.
"ATCO is looking to complete this study as part of a broader opportunity for North Dakota," Rumas said. "As a storage provider of NGLs for the petrochemical industry in Alberta, we see an opportunity to do the same in North Dakota which would support the growth of value-added industries in the state."
Rumas said salt cavern storage of hydrocarbons is a key component for the operation of a petrochemical facility and will be a key consideration for investment. The process of developing a cavern involves the injection of water into a salt-bearing formation to dissolve the salt. The resulting brine is then pumped out, leaving a void which can be used to store hydrocarbons.
The primary uncertainty is the fact that salt formations in North Dakota are relatively thin, so it's not known if a large enough cavern can be developed. The study will determine if large capacity caverns are feasible and the expected cost of development. The research will also include a cavern mining plan.
The total budget for the 18-to-24-month study is about $2.1 million. The research council recommended a grant of $932,500 to support the project. Click
here to read ATCO's grant application.
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Innovation Academy Gets a Jumpstart
Good Early Results in Fundraising Campaign
Williston Public School District #1 held a "ground-breaking ceremony" Tuesday for its future Innovation Academy, which will renovate the district's old Hagan Pool building into a two-story school.
School Board President Joanna Baltes explained the history of the project during the ceremony. She said after three failed bond referendums, the board and administrators recognized it would require a new ideas to provide adequate classroom space for the district's rapidly growing student population.
Describing it as the anchor sponsor, Baltes announced that American State Bank provided the largest single donation in the bank's 113-year history, contributing $500,000 to the Innovation Academy. She also thanked ONEOK which donated $250,000 to the project. Previously in September, Equinor sponsored a free-will donation lunch, and several oil industry companies came forward raising more than $185,000 for the Innovation Academy.
Renovation work is currently underway on the west end of the building, which will house administrative offices. Eventually, the cavernous pool area will be split in half to create two floors to provide classrooms, lunchroom and other school facilities. The estimated cost of the renovation work is $12 million, of which the Williston School Board hopes to raise $5 million through private donations.
Click
here to learn more about the Innovation Academy. Click
here for a fact sheet about the project.
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Progress on New Long X Bridge
Work is progressing quickly on the structure that will eventually replace the historic Long X Bridge over the Little Missouri River south of Watford City.
The ND Department of Transportation awarded a nearly $34 million contract earlier this year to Ames Construction to build the new bridge and dismantle the old one (see
June 7 newsletter). The company is based in Burnsville, Minnesota.
Mike Fanelli, Senior Project Manager for the company, told attendees at the Ports-to-Plains conference this week in Williston that work on the bridge foundation will be completed this fall. Panelli said parts of the bridge that rest in the river channel will also be completed before freeze up.
Click
here to listen to Panelli's comments.
Panelli said the new bridge, which is being built east of the existing structure, will be about 800 feet long and 80 feet wide. He said it will be a solid structure built to handle the Bakken's heavy truck traffic.
Click
here to listen to Panelli's comments.
Panelli said the bridge will have four 12-foot driving lanes, 12-foot emergency/breakdown lanes on either side, as well as a six-foot lane down the center.
"The key thing about this new design is we get rid of that old overhead structure," Panelli said. "It eliminates the height requirements, and then going to four lanes with the emergency breakdown lanes really will reduce issues with the overwidth and restricted loads."
The bridge is expected to be open by the end of next fall's construction season, after which demolition of the old structure will begin. That's due for completion by July 2021.
Click
here to see DOT’s eight-page handout from public hearings held last spring on the project. Click
here to see photos and a detailed description of the Long X Bridge from BridgeHunter.com.
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Scholarship Application Deadline Today!
The deadline to apply for one of five energy scholarships being offered by WDEA has arrived. Applications must be received via email or postmarked by midnight tonight.
The association is offering five $1,000 scholarships to students interested in pursuing a career in the energy sector. The opportunity is aimed at students who are enrolled in, or plan to enroll in energy-related training at either a college or technical school. The application process is easy. Students are asked to complete a one-page form, write up to a 300-word essay describing their interest in energy development, and include a recent transcript. Additional supporting documents such as letters of recommendation may also be included.
Click
here to see the selection criteria. Click
here to view or download the scholarship application.
Scholarship winners will be announced at WDEA's annual meeting, October 30-31 in Minot..
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Registration Now for WDEA Annual Meeting
Reduced Earlybird Registration Fee Ends Tonight
Guests planning to attend the annual meeting of the Western Dakota Energy Association should register immediately to take advantage of the earlybird registration rate for the two-day event. The reduced rate of $95.00 will increase to $120 tomorrow.
The meeting will be held October 30-31 at the Grand Hotel in Minot. The event kicks off at 1:00 p.m. on October 30 with an update on enhancements and expansion of WDEA's
LoadPass Permits system, to be followed by an update on the association's
Wise Roads weather station project. That will be followed by a panel discussion about truck permitting issues between industry representatives and county highway managers. The balance of Day One will be devoted to issues associated with North Dakota's growing natural gas production. The day will be capped off by an evening social at 5:30 featuring remarks from Cal Klewin regarding the Theodore Roosevelt Expressway Association and efforts to improve Highway 85.
Day Two opens with a perspective on ethics issues from Minot Senator David Hogue, to be followed by a presentation on workforce issues by Paula Hickel and Susan Ogurek from Job Service of ND, an update on the Western Area Water Supply Authority from Curtis Wilson, and the Upper Great Plains Transportation Institute's update of its county roads needs study. The morning agenda also features a presentation from Tim Nesheim with the North Dakota Geologic Survey about the potential for oil production in different benches in western North Dakota, a panel discussion about the education funding needs of western communities and an interim legislative report from Senator Rich Wardner.
Lt. Governor Brent Sanford will deliver a keynote address during the noon luncheon. The afternoon agenda includes details on lignite research and marketing efforts, and will conclude with a traditional county-by-county production report from Lynn Helms, director of the Department of Mineral Resources. The association's annual business meeting and election of officers will wrap up the event.
Click
here for the agenda and registration details. A block of rooms has been reserved at the Grand Hotel. To receive the discounted rate, guests should mention WDEA Annual Meeting when registering. Contact the hotel at: 701-852-3161 or (800) 735-4493.
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Quick Connect
- Sand deposit could be 'game-changer' for ND oil industry -- Fargo Forum
- EPA looking to change ethanol projection calculations -- KFYR-TV
- Decision: ND TENORM facility hinges on conditional use permit -- Williston Herald
- TR Presidential Library CEO pledges transparency for project's planning -- Bismarck Tribune
- $1.2B water pipeline serving central/eastern ND to start construction next spring -- Fargo Forum
- State not getting as much benefit from wind energy boom as it could -- Williston Herald
- Interior Department supports $6.3B in economic activity and 20,000 ND jobs -- 1100 The Flag
- After voting 4-1 not to dissolve, Williams District 8 OKs starting a high school -- Williston Herald
- Williams County resident says survey supports District 8 dissolving -- Williston Herald
- Abatements in Divide County School District lead schools to raise tax levy -- The Journal
- Taxpayers pay when vandals shoot road signs, state aims to stop damage -- Fargo Forum
- Drone fleet getting set for take-off in northwestern North Dakota -- Williston Herald
- Attorney General: Minot broke open meeting law with Washburn retreat -- KFYR-TV
- Reader's Digest: Watford City named 'The Nicest Place in North Dakota' -- Williston Herald
- Minot Chamber new chair urges membership to “celebrate our businesses’ -- Minot Daily News
- Ports To Plains Conference held in Williston; discuss business opportunities -- Williston Herald
- National and regional energy trade groups look to enter Keystone XL pipeline suit -- Law 360
- Future of energy infrastructure hinges on 2020 presidential election -- The Independent
- Unprecedented blackouts and $6 gasoline: California’s big energy crisis -- OilPrice.com
- Ethanol futures tumble by over 4% on EPA fix to offset refinery waivers -- Bloomberg
- Climate Investigation Center uses dark money network to obscure funders -- Energy in Depth
- National Weather Service forecast predicts bearish outcome for winter heating -- S&P Global
- U.S. shale output nears 9 million Bpd with Permian and Bakken leading the way -- OilPrice.com
- Tables have turned on "uncertainty" and climate change advocates view the long game -- IER
- Op-ed: Don't increase the ethanol mandate, get rid of it since times change -- InsideSources
- Op-ed: U.S. electric reliability at risk with deployment of more renewables -- Real Clear Energy
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Factoid of the Week
Western North Dakota has more than an 800-year supply of lignite coal that is economically feasible to recover. Electric generation uses 79% of the state’s production while synthetic natural gas generation comes in second using 13%. Fertilizer product production and other uses make up the rest. About two million consumers and businesses in the Upper Midwest use lignite-generated energy.
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October 21-23
Dickinson
October 22
Bismarck
October 22
Bismarck
October 23
Bismarck, ND
October 24
Bismarck
October 24-25
Bismarck
October 30
Devils Lake, ND
October 30-31
Minot
November 4-5
Williston, ND
November 6
Bismarck, ND
November 12-13
Fargo, ND
November 28
Grand Forks
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Oil prices and rig count
October 18, 2019
WTI Crude: $53.78
Brent Crude: $59.42
Natural Gas: $2.32
North Dakota Active Rigs: 61 (up 3)
10/18/2018
-- 70 rigs
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Geoff Simon
Editor/Executive Director
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