The Bakken and All North Dakota oil production data is out.
Bakken production was up by 5,166 barrels per day to 1,119,380 bpd While all North Dakt0a was up 5,195 bpd to 1,176,314 bpd.
North Dakota production has been basically flat for 14 months. Both North Dakota and Bakken production is still below their September 2014 levels.
The monthly Baker Hughes International Rig Count came out a few days ago. Baker Hughes international rig counts do not include US, Canada, FSU countries or on shore China. All rig count data here is through December 2015 and includes all rigs, gas, oil and misc.
Total international rig count was down 14 rigs from November to December. From December 2014 to December 2015 rig count was down 218 rigs or 16.6 percent.
I need to tell you of a very special talent I have. I have the very unusual and rare ability to find, to ferret out if you will, the blatantly obvious. I mean if it is as plain as the nose on your face, I am going to figure it out. What shocks me is that this ability is so rare. What is happening to our earth and our species is so obvious it is mind blowing.
I could give you thousands of forest disappearing, deserts expanding, rivers drying up, water tables dropping, top soil disappearing, species going extinct, ocean fish disappearing, pollution and plastic waste killing sea birds, and on and on and on. But I will start with one example that exemplifies what is happening to the entire world, the Aral Sea.
What has been happening to the world can be exemplified by this short 3 minute video on the Aral Sea: The Aral Sea story.
The Aral Sea was once the fifth largest inland sea in the world. It supported a huge fishing industry. But that was before they dammed its tributaries to irrigate cotton fields.
This is a guest post by Ciaran Nolan
Disclaimer
The opinions and views expressed in this presentation are solely those of the author and not necessarily those of any organisation.
Introduction
This presentation builds upon earlier work carried out by the author in May 2015 on the North Dakota (ND) Bakken / Three Forks Light Tight Oil (LTO) Play – ‘Bakken – the bubble has burst’*.
North Dakota Industrial Commission (NDIC) production data (up to November 2015) kindly supplied by Enno Peters. Data analysed in Excel and IHS Kingdom.
Production decline curves generated for P10 – P90 type wells, based on8843 wells with 1 year full production (January 2007 – October 2014).
Discounted cash flow (DCF) models were generated by the author for single wells in the ND Bakken / Three Forks Play.
Break even oil prices for Net Present Values with a 10% discount rate (NPV10) determined for P10 – P90 type wells. NPV10 break even oil price map generated. Historical NPV10 generated for average wells for 2008 – 2015. NPV10 breakeven oil price determined for top ten Bakken Producers in 2014, for 2014 wells.
Dennis Coyne, an editor and frequent contributor to this blog, has suggested that we are not at peak oil. He argues that there is likely to be a dip in production starting next year but higher prices will cause things to turn around and we will surpass the 2015 peak by 2019. He commented a few days ago:
If we take some of the larger producers that have been increasing output and compare with the rest of the world(ROW) using EIA data from Jan 2004 to June 2015 (using the trailing 12 month average to focus on the trend) we see ROW decline has been relatively modest (1.4% based on the trailing 12 month output in June 2015). The eight increasing producing countries I have chosen are Brazil, Canada, China, Iran, Iraq, Russia, Saudi Arabia, and US and ROW=World minus the 8 countries just listed.
One possible scenario is that output is flat for the Big 8 in 2016 so that World C+C output falls by 485 kb/d in 2016 (average output for the year compared to the 2015 average). Over the 2009 to Jun 2015 period the Big 8 increased output at about 1300 kb/d per year, if we assume this rate slows to half the previous rate to a 650 kb/d per year increase (1.4%/year), then the peak is surpassed in 4 years in 2019. On a per country basis this would be a little more than a 80 kb/d increase in average annual output for each of these countries, though I doubt it would be divided equally.
So I have taken close look Dennis’s “Big 8” countries as well as “The Rest of the World”, and looked at their JODI data charts. The last data point is October 2015.
First, the rest of the world.
This is the world less Brazil, Canada, China, Iraq, Iran, Russia, Saudi Arabia and the USA. As a group they peaked in October 2004 and have been in decline ever since. They have declined in times of low oil prices and high oil prices. And barring a miracle they will continue to decline.