This is a pretty good indication of the new oil & NG production growth in this part of Oklahoma.
The Mississippian Lime formation is providing wealth creating employment & investment opportunities for thousands.
Over time, this formation will provide Billions of dollars in new tax revenue to state and local governments.


http://finance.yahoo.com/news/Plains-All-American-Announces-bw-3986150647.html?x=0
HOUSTON--(BUSINESS WIRE)-- Plains All American Pipeline, L.P. (NYSE:PAA) today announced it is converting an existing Oklahoma liquefied petroleum gas (LPG) pipeline into crude oil service. The pipeline, which extends from Medford, Okla. to PAA’s crude oil terminal facility in Cushing, Okla., will provide an initial crude oil throughput capacity of 12,000 barrels per day by January 2012 and will be expanded to 25,000 barrels per day by July 2012.

“Converting and expanding this pipeline provides timely take-away capacity for growing crude oil production in the Mississippian Lime formation in northern Oklahoma and southern Kansas,” said Harry N. Pefanis, President and COO of Plains All American. “This project extends our commitment to service Mississippian producers and is one of a number of projects PAA is progressing to service the growing infrastructure needs in this area and multiple resource plays throughout North America.”

PAA owns a network of approximately 16,000 miles of liquids pipelines, approximately 90 million barrels of liquids storage capacity and handles more than 3 million barrels of physical product on a daily basis.

OU48A -

I have an interest in 480 acres of minerals just a few miles north of the Cimmaron river and east of I-35. Western Payne county.

Any chances this area is part of the ML formation ?

OU48A -

I have an interest in 480 acres of minerals just a few miles north of the Cimmaron river and east of I-35. Western Payne county.

Any chances this area is part of the ML formation ?

I’m honestly not sure but there could be other possibilities for your acreage.

I’m honestly not sure but there could be other possibilities for your acreage.

We've had a well on a part of it since 1980. Still puts out about a barrel a day after all these years. Red fork sand formation they say.

We've had a well on a part of it since 1980. Still puts out about a barrel a day after all these years. Red fork sand formation they say.
Right now frac cost are high and there is a very long waiting list but maybe someday if rates come down and oil prices stay up they might consider a frac job for your well. Good luck

This is great news.

Oklahoma's Continental Resources is the largest single player in the Bakken - with 500 wells - and it could possibly triple that number in five years

Read more: http://missoulian.com/business/local/bakken-fields-becoming-biggest-oil-play-in-u-s/article_3d61721c-2926-11e1-8bfe-001871e3ce6c.html#ixzz1h2Ze5ZaJ

Continental Resources (NYSE: CLR ), who announced today its production increased 57% in the past year.

This phenomenal growth means Continental Resources will continue to grow its presents in OKC and will become a bigger part of the community.

Continental Resources (NYSE: CLR ), who announced today its production increased 57% in the past year.

This phenomenal growth means Continental Resources (CLR) will continue to grow its presents in OKC and will become a bigger part of the community.

The NYSE loved the CLR report today.

It closed at $82.47 up $ 8.24 (+11.10%)

Sand Ridge to by Dynamic Offshore Resources

http://www.thestreet.com/story/11397195/1/7-things-sandridge-energy-doesnt-want-you-to-know.html

If you have any interest, you should check out Gulfport Energy. In 2010, in The Oklahoman, they were the #7 rated business in the state of Oklahoma, in 2011, they shot to #2.

Since there are several Oklahoma companies and plenty of Oklahoma’s actively involved in this oil play this show tonight might be interesting.

http://www.cnbc.com/id/46167125

Premieres Monday, February 6th 9p | 12a ET

The epicenter of an oil rush is in Williston, North Dakota. CNBC’s Brian Shactman is on the ground for an inside-look at a town like no other in America, overflowing with growth, jobs and opportunity. The once quiet town sits on top of one of the largest oil deposits ever found in North America and the process known as fracking is turning that enormous oil reserve into cold hard cash.

CNBC cameras capture both incredible growth and the serious growing pains that come with it, exposing a small town bursting at the seams. Boomtown is under immense pressure, crushed by truck traffic, plagued by lagging infrastructure, and shocked by a surge in violent crimes. But the biggest threat is the controversy surrounding what goes on underground. From worries over contaminated ground water to concerns about earthquakes, all over the country fracking is making news and taking serious heat. Will regulation aimed at fracking derail Williston? Brian Shactman goes beyond the headlines inside the real story of an American oil rush.

http://www.reuters.com/article/2012/02/07/plains-pipeline-idUSL4E8D77RP20120207?feedType=RSS&feedName=marketsNews&rpc=43
Plains line could boost supply to Cushing by 175,000 bpd

* Plains signs deal with SandRidge Energy to transport crude

* New line to serve Mississippian Lime shale oil play in OK.

NEW YORK, Feb 7 (Reuters) - Plains All American will build a new crude oil pipeline from a booming U.S. shale oil play to the largest U.S. oil hub at Cushing, Oklahoma, the company said on Tuesday, potentially boosting Cushing deliveries by 175,000 barrels per day (bpd).

The new line is expected to start up in mid-2013, Houston-based Plains said. It will transport crude pumped by producer SandRidge Energy, a major acreage holder in the up-and-coming Mississippian Lime shale play, which spans Oklahoma and Southern Kansas.

The pipeline is a huge expansion of a project Plains first announced last December, known as the Medford-to-Cushing line. Altogether, the new pipeline system will run 170 miles from near Alva, Oklahoma to Cushing, the delivery point for the NYMEX benchmark WTI crude contract.

Plains earlier plans had called for a modest flow of up to 25,000 bpd into Cushing, while the planned expansion could boost Cushing-bound capacity by seven times that volume.

The Plains announcement comes at a time when many oil producers in the U.S. Midcontinent have been seeking to ship oil away from Cushing and toward regions, such as the U.S. Gulf Coast, where crude commands a hefty premium to Cushing prices.

Light crude in the Gulf Coast has been trading around $10 a barrel higher than at Cushing, where outbound pipeline capacity it limited.

Enterprise Product Partners is working to reverse the 150,000 bpd Houston-to-Cushing Seaway pipeline by the middle of 2012, to siphon more crude away from big crude hub.

A glut of crude in the Midwest, largely due to increasing Canadian crude imports and growing shale oil production in North Dakota and other shale plays, has driven regional price disparities. Cushing tanks have been holding around 30 million barrels of crude, according to Department of Energy data.

In December, SandRidge announced it entered a $1 billion joint venture with Spanish oil major Repsol YPF to develop acreage it holds in the Mississippian play in Western Kansas. At the time, SandRidge said it had already drilled more than 195 wells in the play.

Plains said it could extend the new pipeline project northward from Oklahoma into Kansas if demand warrants further construction.

Good news for DVN
http://www.rigzone.com/news/article.asp?a_id=115196&hmpn=1
HOUSTON - Devon Energy Corp. will increase its oil production by 20% in 2012 as the independent oil and gas producer joins its peers in fleeing a weak natural gas market.

Devon and other oil and gas producers have scaled back their gas production activities as prices for the commodity have fallen to their lowest point in a decade. New drilling technology has helped lead to a glut in natural gas supply that has pushed prices to $2.50 a million British thermal unit, down from nearly $14 in July 2008.

"We're focused on oil opportunities," Devon Chief Executive John Richels said during a call with investors. "In 2012, virtually all of our capital will be directed to our oil and liquids-rich project areas."

Devon budgeted up to $5.5 billion for capital expenditure projects for 2012, down nearly a quarter from 2011. About 90% of that will be spent increasing acreage holdings or drilling activity in liquids-heavy fields, Richels said.

Devon said for 2012 it will invest $1 billion in the Permian Basin in west Texas and New Mexico, $950 million in the Barnett shale formation in East Texas, and $870 million in the Cana field in west Oklahoma. Devon spent about $400 million the fourth quarter acquiring acres in the sprawling Utica shale in the Midwest and another undisclosed area.

The company said it was particularly excited by the results of test wells it drilled in the Mississippi Lime, a limestone formation stretching through Kansas and Oklahoma. The company plans to have 50 wells drilled in the formation in 2012 after a test well produced 590 barrels of oil equivalent a day that were "some of the best quality crude oil in the lower 48," according to David Hager, Devon's vice president of exploration and production.

Devon's production in natural gas wells for 2012 will decrease "slightly" as it stops investing in wells of that type. It still expects its overall natural gas production to stay steady as it captures the natural gas trapped in oil wells.

Devon will also boost its quarterly dividend by 18%, to 20 cents a share, Richels said

natural gas supply that has pushed prices to $2.50 a million British thermal unit, down from nearly $14 in July 2008.

Wow, I had no idea it was that bad.

At the same time, oil prices have gone through the roof.

At my company, nearly all projects we get are now oil wells. Thank god for that or else we would be screwed right now.

Any nat gas wells that are being drilled right now are just an attempt to save leases and keep the losses to a minimum.

Gas fields that produces "dry gas", as in, gas with no corresponding condensates or oil, are winding down.

I know quite a few newish gas wells are being shut in out in Western OK. The Fort Worth portion of the Barnett Shale in Texas, for the most part, is done until gas gets back up.

Its a bit concerning given the fact many of these wells aren't forecast to recoup their costs for another 4-5 years, and that was made w/ a price projection of $4-5/mcf. Also, keep in mind OK gas generally sells less than the well known NYMEx spot price.

Wow, I had no idea it was that bad.

At the same time, oil prices have gone through the roof.

Crude is still trading well below its record peak of $145 that occurred in the summer of 2008.
By the following December WIT had fallen to about $30.28 a barrel,


“Ten of the last 11 recessions were preceded by oil price hikes”

http://reason.org/news/show/oil-price-shocks-and-the-recession

There seems to be a 6 to 9 month lag time before it shows up with higher unemployment statistics.



Currently Brent Crude is trading at about $120 and is believed by some analyst to be approaching demand destruction levels.

WTI crude trades at a significant discount at about $102

Because of a lack of pipeline transportation capacity Bakken crude has been trading for as low as $71 in recent weeks. As a result the average price of gasoline in Wyoming is $2.90 right now.
http://www.businessweek.com/finance/rising-gas-prices-not-demand-driven-02142012.html

Good news for DVN

"We're focused on oil opportunities," Devon Chief Executive John Richels said during a call with investors. "In 2012, virtually all of our capital will be directed to our oil and liquids-rich project areas."

Devon budgeted up to $5.5 billion for capital expenditure projects for 2012, down nearly a quarter from 2011. About 90% of that will be spent increasing acreage holdings or drilling activity in liquids-heavy fields, Richels said.

Devon said for 2012 it will invest $1 billion in the Permian Basin in west Texas and New Mexico, $950 million in the Barnett shale formation in East Texas, and $870 million in the Cana field in west Oklahoma. Devon spent about $400 million the fourth quarter acquiring acres in the sprawling Utica shale in the Midwest and another undisclosed area.

Devon will also boost its quarterly dividend by 18%, to 20 cents a share, Richels said

Saw an interview last night with the Richels guy and he said they are acquiring 3-500,000 acres in a new play but would not divulge where this new play was.

http://finance.yahoo.com/news/Continental-Resources-prnews-1056333016.html?x=0

OKLAHOMA CITY, Feb. 22, 2012 /PRNewswire/ -- Continental Resources, Inc. (NYSE: CLR - News) reported EBITDAX of $411.9 million for the fourth quarter of 2011, an 86 percent increase over EBITDAX for the fourth quarter of 2010. The Company attributed the EBITDAX growth to strong oil and natural gas production growth.

Continental's production averaged 75,219 Boepd (barrels of oil equivalent per day) for the fourth quarter of 2011, a 57 percent increase over production of 48,034 Boepd for the fourth quarter of 2010. Crude oil accounted for 72 percent of Continental's fourth quarter 2011 total production.
"With this momentum, we now expect to grow production in a range of 37 percent to 40 percent for the year," Mr. Hamm said

http://finance.yahoo.com/news/Continental-Resources-prnews-1056333016.html?x=0

OKLAHOMA CITY, Feb. 22, 2012 /PRNewswire/ -- Continental Resources, Inc. (NYSE: CLR - News) reported EBITDAX of $411.9 million for the fourth quarter of 2011, an 86 percent increase over EBITDAX for the fourth quarter of 2010. The Company attributed the EBITDAX growth to strong oil and natural gas production growth.

EBITDA I've got - what's the X at the end?

EBITDA I've got - what's the X at the end?

I don’t know what the X means?
Maybe one of the boards more experienced / enlighten posters could inform us?

I don’t know what the X means?
Maybe one of the boards more experienced / enlighten posters could inform us?It stands for "eXploration expenses."

It stands for "eXploration expenses."

Thanks

This is a good indication of good drilling results in the areas mentioned.

http://www.ogj.com/articles/2012/02/semgroup-chesapeake-to-build-oklahoma-crude-oil-pipeline.html

HOUSTON, Feb. 21
02/21/2012
By Christopher E. Smith
OGJ Pipeline Editor

SemGroup Corp., Gavilon Group LLC unit Gavilon Midstream Energy LLC, and a unit of Chesapeake Energy Corp. plan to form a joint venture to build a 210-mile pipeline in western and north-central Oklahoma. The line will transport oil to a 1 million bbl storage facility in Cushing. The companies described the project as meeting growing midstream requirements resulting from drilling activity in western Oklahoma and the Mississippi Lime play.

The pipeline will consist of two laterals, one starting near Alva in Woods County, Okla., and the other near Arnett in Ellis County, Okla. The laterals will intersect near Cleo Springs in Major County, Okla., where the pipeline will increase in diameter and continue east to storage at Cushing.

The pipeline will have an initial capacity of 140,000 b/d, expandable to 180,000 b/d through additional horsepower. SemGroup will design, build, and operate the pipeline; Chesapeake is the project’s anchor shipper; and Gavilon will perform risk management and clear the shipped crude in the Cushing market.

The companies plan to begin building the pipeline in July for an in-service date of third-quarter 2013.

SemGroup unit SemCrude LP last year contracted to build 1.95 million bbl of additional crude oil storage at its Cushing terminal to service expanded flows from the Denver-Julesburg basin on its White Cliffs Pipeline

TransCanada Corporation announces that the Cushing to U.S. Gulf Coast portion of the Keystone XL will be constructed due to significant increased crude oil production.

This is very good news for Oklahoma.

http://transcanada.com/5966.html

TransCanada Corporation (TSX, NYSE: TRP) (TransCanada) announced today it has sent a letter to the U.S. Department of State (DOS) informing the Department the company plans to file a Presidential Permit application (cross border permit) in the near future for the Keystone XL Project from the U.S./Canada border in Montana to Steele City, Nebraska. TransCanada would supplement that application with an alternative route in Nebraska as soon as that route is selected.

The company also informed the DOS that what had been the Cushing to U.S. Gulf Coast portion of the Keystone XL Project has its own independent value to the marketplace and will be constructed as a stand-alone Gulf Coast Project, not part of the Presidential Permit process. The approximate cost is US$2.3 billion and subject to regulatory approvals, we anticipate the Gulf Coast Project to be in service in mid to late 2013.

"Our application will include the already reviewed route in Montana and South Dakota," said Russ Girling, TransCanada's president and chief executive officer. "The over three year environmental review for Keystone XL completed last summer was the most comprehensive process ever for a cross border pipeline. Based on that work, we would expect our cross border permit should be processed expeditiously and a decision made once a new route in Nebraska is determined."

TransCanada will continue to work collaboratively with the State of Nebraska on determining an alternative route for Keystone XL that avoids the Sandhills. TransCanada has been working on assessing the routing in Nebraska since November 2011, following the State Department's notice to delay a decision on a Presidential Permit until an adjusted route that avoids the Sandhills was developed.

U.S. crude oil production has been growing significantly in States such as Oklahoma, Texas, North Dakota and Montana. Producers do not have access to enough pipeline capacity to move this production to the large refining market at the U.S. Gulf Coast. The Gulf Coast Project will address this constraint.

"The Gulf Coast Project will transport growing supplies of U.S. crude oil to meet refinery demand in Texas," added Girling. "Gulf Coast refineries can then access lower cost domestic production and avoid paying a premium to foreign oil producers. This would reduce the United States' dependence on foreign crude and allow Americans to use more of the crude oil produced in their own country."

Reapplying for the Keystone XL permit is supported by words used in President Obama's statement January 18, 2012 when he said the denial of the permit was not based on the merits of the pipeline but rather on an imposed 60-day legislative timeline to make a decision on the project.

With respect to moving forward on an initiative like the Gulf Coast Project, President Obama stated: "In the months ahead, we will continue to look for new ways to partner with the oil and gas industry to increase our energy security - including the potential development of an oil pipeline from Cushing, Oklahoma to the Gulf of Mexico."

TransCanada's commitment is to treat landowners with honesty, fairness and respect. The company has negotiated over 99 per cent of voluntarily easements in Texas and close to 100 per cent in Oklahoma. Easements make up the route of a pipeline and are similar to an easement for water, sewer and utility lines. Residents maintain ownership of the land and landowners receive a payment equal to or greater than the land's market value.

Keystone XL remains in the national interest of the United States as it would allow Americans to move closer toward achieving energy security and create thousands of much needed jobs. Building the Gulf Coast Project would be a positive step in creating approximately 4,000 jobs. From an energy security standpoint, the U.S. consumes 15 million barrels of oil each day and imports 10 to 11 million - forecasts suggest this will not change for decades. The Keystone XL project offers Americans a choice of receiving Canadian and U.S. oil through this pipeline system or continuing to import crude oil from unstable places such as the Middle East and Venezuela that do not share American values.

The U.S. manufacturing sector would continue to experience the economic benefits of the project, as TransCanada has contracts with over 50 suppliers across in the U.S. Manufacturing locations for our equipment include: Texas, Missouri, Pennsylvania, Michigan, Oklahoma, South Carolina, Indiana, Georgia, Maryland, New York, Louisiana, Oklahoma, Minnesota, Ohio, Arkansas, Kansas and California. There are hundreds of additional suppliers sub-contracted through our suppliers for our material and equipment.

FYI
OKC’s Harold Hamm, CEO of CLR, will be on CNBC Tonight at 6 PM central

Two years ago, we leased 200 acres in western Payne county for $100.00 per acre for 3 years. We just leased some more this week for $250.00 per acre for 3 years. Now if someone would just come in and drill a horizontal well, we'd all be happy.

This is very good news for Oklahoma Companies, producers and several communities.
This will employ a good number of Oklahoman's and improve safety.

http://www.marketwatch.com/story/enbridge-confirms-us-pipeline-expansion-plans-2012-03-27

Enbridge Inc. confirmed expansion plans for two U.S. pipelines late Monday at a cost of about $3.8 billion in a bid to move more crude from Canada to refineries along the Gulf Coast as North American oil production surges.

Calgary-based Enbridge said it's boosting the capacity of the Flanagan South Pipeline, running from Flanagan, Ill. to Cushing, Okla., by upsizing to a 36-inch diameter line with an initial capacity of 585,000 barrels a day.

Separately, it said it and partner Enterprise Products Partners L.P. will twin their jointly owned Seaway Pipeline from Cushing to the U.S. Gulf Coast at Houston, more than doubling the pipeline's capacity to 850,000 barrels a day by mid-2014.

Enbridge said it estimates its total cost of the Flanagan South project at $2.8 billion, up from an original estimate of $1.9 billion, while its share of the Seaway twin line and extension is estimated at $1 billion.

The Seaway expansion will involve the construction of a 512-mile, 30-inch diameter twin, or parallel line, along the route of the Seaway Pipeline, adding 450,000 barrels a day of capacity to the existing system. The Flanagan South Pipeline will be constructed along the route of Enbridge's existing Spearhead Pipeline between the Flanagan Terminal, southeast of Chicago, to Enbridge's Cushing Terminal in Oklahoma.

"Enbridge's Gulf Coast Access projects give Bakken and western Canadian producers timely, economical and reliable options to deliver a variety of crudes to refinery hubs throughout the heart of North America and now as far as the Gulf Coast," Enbridge Chief Executive Patrick D. Daniel said in a statement.

http://finance.yahoo.com/news/continental-resources-officially-moves-headquarters-120000033.html

OKLAHOMA CITY, March 27, 2012 /PRNewswire/ -- America's oil champion has a new home. Today, Continental Resources (NYSE: CLR - News) announced it has officially moved its corporate headquarters to Oklahoma City.

(Logo: http://photos.prnewswire.com/prnh/20120327/DA76602LOGO)

Chairman and Chief Executive Officer Harold Hamm said the move from Continental's original headquarters in Enid, Okla., is a key element of the company's growth strategy. Oklahoma City provides access to a necessary talent pool of oil and gas professionals.

"Oklahoma City offers a vibrant base to support our aggressive growth strategy and allows us to retain our strong commitment to the State of Oklahoma," Mr. Hamm said. "With its accessibility, strong heritage and continued leadership in oil and gas, Oklahoma City is emerging as the energy capital of the future."

Continental's new headquarters is located downtown at 20 North Broadway, a 19-story, 300,000 square-foot building previously occupied by Devon Energy. The new building will be known as the Continental Oil Center and new building signage will be installed the week of March 26.

Of the company's 650 employees, 400 will office in Oklahoma City. Continental is currently hiring, and the employee count is expected to grow significantly over the next several years.

The move coincides with Continental's rise as one of the nation's leading oil and gas companies. It is the largest oil driller, producer and leaseholder in the Williston Basin of North Dakota and Montana, the largest leaseholder in the Bakken play of North Dakota and Montana, and a developer and largest leaseholder in the Anadarko Woodford of Oklahoma. The company is also the largest producer in the Red River Units of North Dakota, South Dakota and Montana.

In addition to changing its physical address, Continental is changing its website address. The new website address is www.CLR.com and will take effect today. CLR is also the company's NYSE symbol.

About Continental Resources
Continental Resources is at the forefront of the exploration and production of oil and natural gas resources in the United States and is the largest producer of oil in the Williston Basin. Using the latest technology in horizontal drilling, Continental is leading the development of key oil and natural gas resources in the continental U.S., including the Woodford resource play in Oklahoma and the nation's premier oil play, the Bakken resource play in North Dakota and Montana. For more information, visit www.CLR.com.

Bakken Reassessed by U.S. Geological Survey
The USGS has sent a team of geologists and geochemists back to the Bakken to study rock samples from previous drillings.

Click to view a Harold Hamm interview.
http://www.kulr8.com/news/local/Bakken-Reassessed-by-US-Geological-Survey-144295135.html?video=pop&t=a

http://g.foolcdn.com/editorial/images/8860/4-map-of-unconventional-plays_large.jpg

That is a nice graphic ou48. Are any of the shale plays old enough to have data on long term affects of the fracturing process on surrounding areas? I ask this as supporter of the technology that has the potential to change our future if we can reduce our dependence on foreign energy sources. I want there to be hard data that refutes claims of environmental damage caused by the process itself - not the improper implementation of the process. I think we need oversight to insure all appropriate protective measures are taken while permitting us to extract oil and gas from these shale formations.

That is a nice graphic ou48. Are any of the shale plays old enough to have data on long term affects of the fracturing process on surrounding areas? I ask this as supporter of the technology that has the potential to change our future if we can reduce our dependence on foreign energy sources. I want there to be hard data that refutes claims of environmental damage caused by the process itself - not the improper implementation of the process. I think we need oversight to insure all appropriate protective measures are taken while permitting us to extract oil and gas from these shale formations.

Because of the very tight porosity of the shale’s typically there would be no noticeable impact that I am aware of on surrounding areas due to the fracturing process.

Perhaps the best evidence that supports fracking is the fact that out of well over one million fracking jobs preformed just in the USA, maybe one or 2 problems at most can be traced back to the actual frack job. There have been other issues in the well completion process that some have falsely blamed on a frack jobs.

There are studies that support the safety of fracing.
As they have better understood the process other governments are now starting to allow facking.

There has been a learning curve for some states on modern drilling technology’s,,,, but because local conditions can very so much oversight is best done at the state levels.

There are projections from reputable sources that say the USA can become energy independent and that the USA will soon become the largest oil producer in the world. Some even say we can eventually become a net energy exporter. But even if we fall a little short our nation can become more prosperous by producing most of our energy.

Oklahoma’s will be major players in this effort. To make our state more prosperous IMO our state should attempt to capture a larger share of the processing, refining and manufacturing of value added products from our nation’s new shale oil & NG reserves.

The high quality raw crude that flows though Cushing is worth many billions but as a state I find it ashamed that we don’t do more with it.

Hydrollic fracturing has been in use since the late 1940's. I think the big change is it's use in accordance with horizontal drilling, where they can follow the pay zone for long distances.

That is good to know. It confirms what I believed to be true but had no way to verify personally. I think the technology may be the single biggest contrubutor to moving toward energy independence. I have seen the projections of the US to surpass Saudi Arabia as the world's largest oil producer by 2015 (?). I think of all the geopolitical ramifications for our country if we can safely maximize this technology - reduced need to secure shipping lanes in high threat areas, reduced need to secure hostile countries' oil supply, reduced need to send the military into areas we otherwise have no interest in. If we combine this with a real effort to conserve and develop more efficient uses for our energy sources it will be the single best thing we can do for future generations. It really is bigger than cheaper prices at the gas pump......

This is Oklahoma related
COLUMN-Dreaming of Bakken, Kansas welcomes oil drillers: Kemp | Reuters (http://www.reuters.com/article/2013/01/08/column-kemp-kansas-fracking-idUSL5E9C89J220130108?type=companyNews&feedType=RSS&feedName=companyNews&rpc=43)
COLUMN-Dreaming of Bakken, Kansas welcomes oil drillers:
Tue Jan 8, 2013 11:06am EST
By John Kemp

LONDON Jan 8 (Reuters) - While other states struggle with how best to regulate horizontal drilling and hydraulic fracturing, or wonder whether to permit the practice at all, Kansas is actively courting fracking firms in the hope of repeating North Dakota's oil boom.

Interest centres on the Mississippian Lime Play (MLP), a porous limestone formation found under parts of southern and western Kansas as well as across the boundary in northern Oklahoma.

The Mississippian Lime has already produced more than 1 billion barrels of oil in the state since 1915 from conventional wells but was considered largely tapped out.

Now horizontal drilling and hydraulic fracturing have kindled hopes of a new oil rush as drillers unlock oil and gas previously trapped in impermeable parts of the rock formation.

"The potential economic benefits to Kansas could be significant, resulting in hundreds of wells drilled, billions of dollars in investment, thousands of jobs and industry activity in the MLP for the next 20 to 30 years," the Kansas Department of Commerce enthuses on a special website created to promote the play.

The Kansas Corporation Commission (KCC), which regulates oil and gas, has already organised tours of both North Dakota and Oklahoma to understand the transformative impact of the oil boom and its impact on local residents.

And in November, state leaders, including Governor Sam Brownback, hosted a high-level conference to hear an update on drilling and discuss how Kansas businesses could benefit from oil and gas activity.


STARTING SMALL

In the first 10 months of last year, 143 horizontal wells were drilled in the state, up from 50 in the whole of 2011 and 10 in 2010. Just over 30 rigs were drilling at the end of October, of which 18 were working on horizontal wells. Half were contracted to Sandridge, which holds by far the largest position in Mississippian acreage in the state.

Production from the Mississippian remains tiny compared with the state's conventional oil output let alone more mature unconventional plays such as the Bakken and Eagle Ford. Kansas has more than 46,000 active oil wells (mostly stripper wells producing less than 10 barrels per day) and another 24,000 producing gas.

Unconventional oil and gas production amounted to only 10,000 barrels of oil-equivalent at the end of October, 3.8 percent of the state total. Nevertheless, there is evident excitement at the potential for hydraulic-fracturing to bring a Bakken-like boost to the state economy.


FRACKERS WELCOME

The Brownback administration is unashamedly pro-business, and keen to encourage economic development.

The state is solidly Republican. All state-wide officeholders, both U.S. senators and all four U.S. representatives are from the party, which also controls both chambers of the state legislature by lop-sided majorities (32-8 in the state senate and 92-33 in the lower house).

State agencies are also sympathetic to fracking. In a basically favourable "public information circular" published in May 2012, the Kansas Geological Survey (KGS) explained that of 244,000 conventional vertical wells drilled in the state since 1947, some 57,000 wells have already been hydraulically fractured, without ill-effect.

In contrast to other states, which have agonised over the potential for fracking to lead to contamination of other rock formations and drinking water resources, KGS argued "strong economic incentives compel operators to avoid propagating fractures beyond the target formation and into adjacent areas."

"Kansas has not encountered the problems some other states have, and no documented cases of ground-water contamination by hydraulic fracturing have been reported in the state."

"Kansas' favorable geologic setting, its regulatory process, and its successful history of hydraulic fracturing and fluid management make it one of the safer regions of the country to employ the practice."

In case anyone doubted the state's enthusiasm, the Kansas Corporation Commission has published a note by the KGS and the University of Kansas which states bluntly:

"Induced seismicity (earthquakes) has not been related to hydraulic fracturing. The U.S. Geological Survey has stated that there is no evidence to suggest that hydraulic fracturing itself is the cause of the increased rate of earthquakes in the midcontinent".

Wastewater injection can trigger seismic activity but the KCC and KGS downplay the risk. "It is important to remember that those (waste) fluids are the result of any oil and gas production, and independent of the practice of hydraulic fracturing."

"Earthquakes would someday have occurred anyway as a result of slowly accumulating forces in the earth ... injection just speeds up the process."


SCOPING THE PLAY

Most drilling has so far occurred in parts of the Mississippian in Oklahoma, where more than twice as many rigs are operating and holes have been drilled.

In Kansas, exploration companies are still trying to scope out the play and identify sweet spots. Most wells have been drilled in just three counties along the Oklahoma border (Harper, Barber and Comanche) though wildcats have been sunk in another nine and the play underlies parts of 34 counties in total ().

Early exploration was directed towards natural gas, but with gas prices stuck at just $3-4 per million British thermal units (mmBtu), the focus has switched to finding fairways with more condensate and crude.

"The Lime is a reasonably low-cost play where hydrocarbons have been found before, with lots of (conventional) wells drilled in the past," the Oil and Gas Financial Journal wrote in August 2012 ("Horizontal drilling boosts production in Mississippi Lime" Aug 1).

"The nice thing about this trend versus shale is that it requires low-horsepower equipment, and smaller players can be competitive."

"The limestone's porosity and natural fractures also can mean less expense on the drilling and hydraulic fracturing parts of the project. Expenses can total half and even a fourth of typical unconventional well efforts."

By far the largest operator across the Mississippian is Sandridge, with larger companies like Chesapeake, Range Resources, Shell and Devon playing a much smaller role in the area.

The Mississippian Lime is just one layer in the vast Anadarko sedimentary basin. In other parts of the Anadarko, Continental Resources is targeting production from the Woodford shale.

For the time being, the Mississippian Lime remains a highly speculative play. "No one knows for sure" how much drilling there may eventually be, the Kansas Corporation Commission admits. "The activity in the Oklahoma region of the MLP has been encouraging, but it could be another 12-18 months before the state has a more realistic estimate of the economic impact."

But if significant quantities of oil can be produced from the Mississippian, drillers and frackers will find no state more welcoming.

Im sure they would love to have lots of drilling activity since they have a huge budget shortfall due to their irresponsible tax cut last year.

Im sure they would love to have lots of drilling activity since they have a huge budget shortfall due to their irresponsible tax cut last year.

Exactly. And yet our leadership wants to follow suit...

This article explains some of the complexities of moving new crude oil to markets.
There are bottle necks in the system that impact prices that Oklahoma producers receive.
Over all this is a very good problem for our state and nation to have.


http://www.rbnenergy.com/the-seven-g...-seaway-phase2


The Seven Gates of Hell for WTI Crude Traders – Seaway Phase 2 and the Brent Differential
published by Sandy Fielden on Tue, 01/08/2013 - 18:55

By the end of this week (Friday January 11, 2013) Phase 2 of the Seaway Reversal pipeline project that delivers crude from Cushing to Houston is supposed to have come online - expanding pipeline capacity from 150 Mb/d to 400 Mb/d. Phase 1 of the project was eagerly anticipated by the market but since then (June 2012) the narrowing in price differentials between WTI Cushing and Brent expected by much of the market has not materialized. Today we explain why Seaway Phase 2 is only one factor in today’s complex US crude market evolution

RBN School of Energy brings the RBN Energy brand of energy market fundamentals to an intensive two-day course of study to be held Feb.12-13, 2013, at the St. Regis in Houston, TX. For more information, see RBN School of Energy | RBN Energy Network (http://www.rbnenergy.com/school-of-energy)

The Seaway pipeline runs from Cushing, OK to Freeport, TX (passing through Houston on the way) and originally moved crude from the Gulf Coast up to Cushing. The joint owners of the pipeline, Enbridge and Enterprise reversed the pipeline last June to flow crude from Cushing to Freeport. Phase 1 of the project provided shipping capacity of 150 Mb/d. Phase 2 of the project expands the existing pipeline capacity by adding more pump capacity to increase the volume to 400 Mb/d. Phase 3 of the project is to build a parallel crude oil pipeline alongside the original that will more than double capacity to 850 Mb/d and come online in 2014. RBN Energy Blog contributor Industrial Information Resources explained the project engineering in a post last August (see Seaway Reversal Project).

The “Simple Theory” of WTI Price Recovery

Market speculation about Seaway Phase 2 centers on whether or not the addition of another 250 Mb/d of crude oil capacity between Cushing and Houston will cause the price of West Texas Intermediate (WTI) crude at Cushing, OK – the Midwest domestic market benchmark and the crude delivered against the NYMEX futures contract - to recover lost ground against the Brent ICE futures benchmark. As pretty much everyone involved in crude oil analysis knows by now, WTI has been trading at a discount to Brent over the past two years. That discount has been hovering around the $20/Bbl level for the past six months - even though the two crudes are of similar quality and WTI traded at a slight premium to Brent up until August 2010. It is generally accepted that the large WTI discount to Brent came about because of an oversupply of new crude production from Canada and US domestic shale plays such as the Bakken field in North Dakota into the Midwest market. The new production backed up supplies at the Cushing hub where WTI is traded, causing its price to fall relative to international crudes that are linked to Brent. Since that price dislocation occurred some have assumed that all it would take to end the WTI discount to Brent is for new pipeline infrastructure like Seaway to open up and let the Cushing crude glut flow out of the Midwest -where it is not needed - down to the Gulf Coast where there is plenty of refinery demand. At that point, theoretically WTI prices would resume parity with Brent, the clouds will part and the sun will shine on Oklahoma. For the sake of argument we are going to call that the “Simple Theory” of WTI price recovery.

Unfortunately things are not working out the way the “Simple Theory” would suggest. In fact looking at the data since the Seaway pipeline opened in June 2012 we can see two distinct periods of activity where prices and inventories basically did the opposite of what the “Simple Theory” says should have happened. The chart below shows Cushing stocks and the WTI discount to Brent over the past year. The WTI discount to Brent is the blue line on the left axis and the Cushing crude stock position is the red line on the right axis. The first period to look at (green circle) is between June and November 2012 when Cushing crude stocks declined by about 4 MMBbl after Seaway Phase 1 opened. Instead of the WTI discount to Brent narrowing during that period as the “Simple Theory” expected the discount widened from around $11/Bbl in June to as high as $25/Bbl in November. The second period to look at is between November 2012 and this week (orange circle). During that period Cushing stocks increased by 6 MMBbl to reach another new record level over 49 MMBbl and the WTI discount to Brent fell back from $25/Bbl to $18.25/Bbl. During both these periods the data behaved inversely to the “Simple Theory” that says lower inventories narrow the WTI discount and higher inventories will increase the WTI discount.
In short the “Simple Theory” is not sufficient to explain how and when WTI prices will recover against Brent. Instead the US crude oil market is going through a complex transition that involves more variables than just Cushing inventories and WTI/Brent prices. In the rest of this blog we list seven variables (the “Gates of Hell” in our title) and their influence on crude prices. Only by paying attention to these “gates” can we explain what is happening to crude price relationships.

Gate #1 – Midwest Refinery Demand
Fluctuating refinery demand in the Midwest currently has more impact on Cushing inventory levels than crude flows from Cushing to Houston on the Seaway pipeline. During our last blog on the WTI discount to Brent (see Place Your Bets on Narrower WTI/Brent Spread) we referred to the 400 Mb/d BP Whiting refinery in Indiana that makes up 11 percent of Midwest refinery crude capacity. A significant expansion project at BP Whiting took 250 Mb/d of refining capacity out of the Midwest market in November 2012 that will not be returning until the middle of 2013. That disruption helps explain the rise in Cushing inventories since November 2012. It could be argued that the Seaway Phase 2 expansion evens out the 250 Mb/d that BP Whiting is no longer consuming. That would mean Seaway 2 has no impact on Cushing stocks before BP Whiting comes back on line in mid 2013. Expect refinery demand fluctuations to continue causing temporary blips in crude pricing.

Gate # 2 – The Crude Stockpile at Cushing
Regardless of temporary refinery demand fluctuations in the Midwest the fundamentals suggest that the crude stockpile at Cushing (and oversupply in the Midwest) is going to be addressed by new pipelines – probably by the end of 2013 when Seaway Phase 2 and the Keystone XL Gulf Coast Extension project (700 Mb/d by 3Q 2013) will together have added 0.9 MMb/d of new capacity between Cushing and Houston. Reducing the Cushing stockpile will reduce the downward pressure on WTI prices and narrow the discount to Brent but it is not the only factor and may well be overshadowed by other variables.
Gate # 3 – New Flows of Crude into Houston from the Permian and Eagle Ford

New crude flows from the Permian will come via the Magellan Longhorn Reversal project that will flow 75 Mb/d in 1Q 2013 and another 150 Mb/d by the end of 2Q 2013 as well as the Sunoco Logistics (Energy Transfer Partners) additions to the West Texas Gulf pipeline that will add another 200 Mb/d of capacity from the Permian to Houston by mid 2013.

New pipelines out of the Eagle Ford basin in South Texas began delivering increasing volumes of crude to Houston refineries (Enterprise 350 Mb/d, Kinder Morgan 300 Mb/d) during the second half of 2012.

Because the majority of Permian crude production has been flowing to Cushing, OK up until now - adding to the supply glut there - the new flows of West Texas crude to Houston will relieve pressure on Cushing. [The new pipelines will also reduce the heavy price discount against WTI that Permian producers have recently had to endure because supplies exceeded takeaway capacity and backed up at Midland, TX (see After The Flood).]

The new flows of crude from the Eagle Ford and the Permian will initially be delivered into the Houston area and will not pass through Cushing on their way to market. The focus of trading and pricing for WTI will therefore likely gravitate away from its traditional hub in Cushing. Watch for a new crude trading market based in Houston.

Gate # 4 – New Flows of Crude into Louisiana From North Dakota and the Eagle Ford
Significant new domestic crude supplies are now reaching refineries in the Louisiana Gulf Coast region. We explained recently how 150 Mb/d of Bakken crude arrives by rail from North Dakota at St. James, LA (see Back to The Delta). There is also a growing coastal trade moving Eagle Ford crude by barge from Corpus Christi, TX to St. James. The newly reversed Shell Houston to Houma (Ho-Ho) pipeline begins delivering up to 300 Mb/d of crude from the Houston area to Louisiana Gulf Coast refineries this month (January 2013). These new supplies of light sweet crude into the Louisiana Gulf Coast market are already backing out sweet crude imports (see Thrown for a LOOP Part 1). The current Gulf Coast benchmark light sweet crude – Louisiana Light Sweet (LLS) is priced at a small discount to Brent because it competes with imported crudes that are linked to Brent. Once domestic supplies replace these imports then LLS prices are likely to switch to track domestic crudes linked to WTI rather than Brent.

Gate # 5 – Crude Quality
We have previously discussed the fact that the new supplies of domestically produced crude primarily from North Dakota, the Permian Basin and the Eagle Ford are considerably lighter in composition than the crudes that US refiners have been consuming for years (see Turner Mason and the Goblet of Light and Heavy). In addition, new supplies of crude from Western Canada are a blend of very light and very heavy components that again are not typical of existing grades. Refineries on the Gulf Coast that are configured for heavy crudes can only adapt to run these new crudes by reducing their throughput considerably or undergoing expensive alterations.

If there is a flood of light sweet crudes such as Bakken coming to the Gulf Coast from the Midwest via Cushing on the Seaway and Keystone pipelines then there is a very real danger that the supply glut in Cushing will simply be transferred to the Gulf Coast along with the attendant risks of price discounts that have dogged WTI over the past two years. That is because Houston is already receiving light sweet crudes from the Permian, the Eagle Ford and St. James, LA market is being supplied with North Dakota Crude. Once these flows exceed the demand for light sweet crude on the Gulf Coast (currently about 500 Mb/d) then producers will have to discount their light crudes to levels attractive for refineries configured to run heavier crudes.

Gate #6 Does Seaway Ship Light or Heavy Crude?
It follows that an important influence on Variable # 5 will be whether the crudes flowing from Cushing to Houston on Seaway are mostly light sweet crudes such as North Dakota Bakken and WTI or mostly heavier Canadian crudes. Heavy Canadian crudes are more attractive to Gulf Coast refiners because there is greater refining capacity configured to handle them (although some Canadian light/heavy blend crudes are still not ideal for heavy crude refineries). Higher Seaway volumes of heavy Canadian crudes will therefore have less impact on WTI prices than higher volumes of light sweet crude because the latter will increase the risk of the light sweet glut scenario described in Variable # 5

Gate # 7 The Possibility of Crude Exports
Last but not least we should mention the possibility that the US government will allow some volumes of crude oil exports from the Gulf Coast. Currently crude oil cannot be exported without a special License from the Bureau of Commerce (see Fifty Shades Lighter) and these have only been granted for limited exports to Canada. If crude oil exports are allowed at the Gulf Coast then the light sweet crude glut scenario described in Variable # 5 will be avoided. Producers would simply export any light sweet crudes not needed in the Gulf Coast region to international markets. Refiners would continue to import the heavier crudes their refineries are configured to run. The crude export scenario seems politically unlikely but if it does happen it will have a dramatic impact on US crude prices because WTI and LLS will be linked back to international markets and track Brent prices directly.

Summing Up
Our seven “Gates of Hell” indicate just how complex the Gulf Coast crude supply situation is for crude traders and analysts to navigate today. The fate of the WTI discount to Brent is tied to many factors besides the level of crude stocks at Cushing. The WTI relationship with Brent will not resolve itself overnight through one or two new pipelines but rather by a gradual evolution over the next two years. Our belief (as explained in After the Flood - Gulf Coast Light Sweet Crude Pricing Beyond 2013) is that the WTI discount to Brent will decline over the next two years to arrive at a new level close to $10/Bbl. Along the way there will be plenty of hiccups caused by local demand fluctuations, crude quality issues and potentially a new supply surplus on the Gulf Coast. Stay tuned to RBN Energy for continued insight.

Im sure they would love to have lots of drilling activity since they have a huge budget shortfall due to their irresponsible tax cut last year.

Isn't that the point of advancing the Republican political philosophy of making government smaller by cutting taxes and thereby attracting new business to the state?

Im sure they would love to have lots of drilling activity since they have a huge budget shortfall due to their irresponsible tax cut last year.The first of the Kansas tax cuts didn’t even go into effect until January 1,so in spite of the jump to conclusions the jury is still out in a major way!

The first of the Kansas tax cuts didn’t even go into effect until January 1,so in spite of the jump to conclusions the jury is still out in a major way!

Kansas obviously didn't learn what happened after Oklahoma cut income taxes--a scorched government, yet to recover, along with a state capitol building still in severe need of many millions of dollars worth of repairs and restoration. As with Oklahoma, I bet a lot of industrial expansionists are looking at what else Kansas offers them besides tax cuts.

Kansas obviously didn't learn what happened after Oklahoma cut income taxes--a scorched government, yet to recover, along with a state capitol building still in severe need of many millions of dollars worth of repairs and restoration. As with Oklahoma, I bet a lot of industrial expansionists are looking at what else Kansas offers them besides tax cuts.


Having lived in Kansas for a number of years I believe their states government is operated more efficiently and is more responsible with its tax money than Oklahoma.

Maybe in the past. Right now Kansas's budget situation is dreadful.

Local governments fear Kansas' state budget shortfall repercussions | Cjonline.com Mobile (http://m.cjonline.com/news/2013-01-05/local-governments-fear-kansas-state-budget-shortfall-repercussions)

Even California now has a budget in the black.

If it weren't for Johnson County, Kansas would have the economic vitality of Alabama, without the scenery.

Not sure if posted...

Denver company buys Oklahoma City's Canary Wellhead Equipment | NewsOK.com (http://newsok.com/denver-company-buys-oklahoma-citys-canary-wellhead-equipment/article/3746224/?page=2)

The article did not discuss it, but this pipeline will help Oklahoma oil producers receive more money for their oil.
TransCanada continues building pipeline across Oklahoma to Gulf Coast | NewsOK.com (http://newsok.com/transcanada-continues-building-pipeline-across-oklahoma-to-gulf-coast/article/3746234)


PRAGUE — The daily “scatter sheet” tells the story. The one-page report details how TransCanada is deploying about 850 workers along the Oklahoma portion of its Gulf Coast pipeline.

The 485-mile pipeline is being built in pieces, with construction broken into three spreads to increase efficiency. The longest spread extends about 195 miles from Cushing to the other side of the Texas border.

“It works in an assembly-line fashion,” project spokesman Jim Prescott said.

There are about 30 crews assigned to tasks from locating the company's right of way and erecting fences to lowering in pipe and welding it together.

Crews begin each day at TransCanada's construction yard in Prague before being bused to work sites spread over about 70 miles along the pipeline route.

Trucks move loads of 30-inch pipe from the storage yard at Cushing to where it is needed along the route.

“This is a typical day,” Prescott said. “There's a lot of moving parts.”

Tuesday, one crew was working to tie together two sections of pipe south of Cushing, while another was putting up fences along the right of way in Coal County.

Roger Stogsdill, an assistant chief inspector, said each section of pipe is about 80 feet long.

Crews use a hoe or trenching machine to dig ditches for the underground pipeline, which rests on urethane “pillows” to keep it off the bottom, he said. The pipe also is padded to keep its protective coating from being damaged by rocks when it is buried.

In all, TransCanada is employing about 4,000 workers and spending $2 million a day on construction materials. More money is injected into local economies by workers along the route.

Prescott said TransCanada expects to finish the pipeline by summer, with an eye toward getting it in service in the fourth quarter.

The completed line will transport up to 700,000 barrels of crude oil a day from the storage hub at Cushing to refineries along the Gulf Coast.

The project is part of TransCanada's planned Keystone XL pipeline, which would move crude oil from Canada and North Dakota.

The overall plan was rejected by the Obama administration last year because of concerns about its route through Nebraska's vast Ogallala Aquifer.

The Canadian company opted to move forward with the Gulf Coast portion of the line to help reduce the glut of oil in storage at Cushing.

TransCanada since has submitted a new application for a permit for the proposed transcontinental pipeline.

Having lived in Kansas for a number of years I believe their states government is operated more efficiently and is more responsible with its tax money than Oklahoma.

No wonder. Oklahoma is ranked as the 10th most corrupt state, while Kansas is ranked 44. The Most Corrupt States - The Daily Beast (http://www.thedailybeast.com/galleries/2010/05/09/the-most-corrupt-states.html#slide44)

This is an interesting article about the Mississippi Lime and companies with Oklahoma operations.
Bakken Update: Mississippi Lime Well Design Improvement Is Increasing Estimated Recoveries, Part 3 - Seeking Alpha (http://seekingalpha.com/article/1224931-bakken-update-mississippi-lime-well-design-improvement-is-increasing-estimated-recoveries-part-3?source=yahoo)

This is a very interesting look at America's Oil And Gas Billionaires. It includes several Oklahomans and people with strong Oklahoma ties. Their ingenuity employs many people and their charitable giving to various causes in Oklahoma has helped make our state a better place to live.
Harold Hamm
George Kaiser
Lynn Schusterman
Tim Headington
T. Boone Pickens
There are many others who have done much the same who did not make the list this year

Click link to watch a very good Harold Hamm interview.
America's Oil And Gas Billionaires - Forbes (http://www.forbes.com/sites/christopherhelman/2013/03/04/americas-oil-and-gas-billionaires/?partner=yahootix)



No one has made a greater fortune from the North American Oil and Gas Boom than Harold Hamm. The founder and CEO of Continental Resources is responsible for cracking the code of the Bakken — the vast formation of oil-bearing rock that sits beneath much of North Dakota and Montana. With his 72% ownership stake in publicly traded Continental, Hamm is now worth $11.3 billion, making him the 90th richest person on the planet, according to Forbes newly released annual ranking of the world’s billionaires.


Harold Hamm

The Bakken has truly disrupted not just the American oil market, but the world’s. The amount of oil flowing out of the Bakken has soared from 100,000 bpd in 2006 to more than 550,000 bpd now. Hamm and many other analysts think that the potential is there for output to go to 1 million bpd, making it one of the world’s biggest producing areas, virtually overnight. We caught up with Hamm in February for this video interview, and you can also read my past coverage in Forbes Magazine about how Hamm got his start and a profile of him and his expectations for the future of the U.S. oil scene.

In the oil and gas industry the only bigger fortune than Hamm’s is that of the Koch Brothers. But although Charles and David Koch are tied for 6th in the world, with fortunes of $34 billion each, the bulk of their fortunes are not in the operation of oil and gas fields, but in massive refineries, pipelines and chemicals plants. My colleague Dan Fisher did this Forbes cover story on the Koch’s recently, a must read.

After Hamm on the list of American oil and gas billionaires comes Phil Anschutz and George Kaiser, with fortunes of $10 billion each (tied for 109th).

Anschutz is truly one of the great empire builders in American history. He has made fortunes in oil, railroads and telecom, but today his biggest bets are in entertainment. In late 2012 he put his Anschutz Entertainment Group up for sale, hoping to get more than $8 billion. Through AEG, he operates dozens of the world’s greatest concert venues like the Staples Center and Nokia Theater in L.A., London’s O2, and Shanghai’s Mercedes-Benz Arena. He fills his halls with his own in-house entertainment, including the L.A. Lakers and NHL’s L.A. Kings. You can read my Forbes feature story of Anschutz here.

Kaiser’s family fled Nazi Germany and settled in Tulsa, Oklahoma, where his uncle founded Kaiser-Francis Oil Company. George inherited control in the late 1960s, and made the most of it. He’s now pursuing oil plays in North Dakota, Wyoming and Canada. In the 1990s he bought the Bank of Oklahoma out of federal receivership for $60 million; his stake is now worth $2.4 billion. Check out my cover story on Kaiser’s impressive charitable giving.

The World’s Billionaires The names, numbers and stories behind the 1,426 people who control the global economy. In Pictures: The Richest People on the Planet

Then we have Richard Kinder, the CEO and founder of pipeline behemoth Kinder Morgan. Kinder comes in at 112th place on the list, with $9.8 billion. Kinder Morgan owns 75,000 miles of pipeline and 180 storage terminals capable of handling 2.5 million barrels of oil and 55 billion cubic feet of gas a day. A former Army captain, he founded Kinder Morgan in 1997 with his friend William Morgan, after quitting as president of Enron the year before. You can read my recent magazine feature on Kinder here.

Ray Lee Hunt at $5.6 billion, inherited a fortune from his wildcatter father H.L. Hunt and has been building on it ever since with LNG projects in Peru and Yemen, a refinery in Alabama and big acreage across the United States. Last year Hunt Oil even made a big find in Iraq’s Kurdistan region. He’s ranked 214th.



Inside The 2013 Billionaires List: Facts and Figures
Kerry A. Dolan Forbes Staff
Chevron: The World's Biggest Gusher Christopher HelmanForbes Staff

The World's Richest Billionaire Hedge Fund Managers And Traders Nathan VardiForbes Staff

Billionaires 2013: Notable Newcomers Tory Burch, Nicholas Woodman, Renzo Rosso Erin CarlyleForbes Staff

Jeffrey Hildebrand of privately held Hilcorp Energy comes in at $5.5 billion (219th). In 2011 Hildebrand turned a $100 million investment in the Eagle Ford shale of Texas into a $1.4 billion payday with a sale to Marathon Oil. He has already reinvested in Cook Inlet, Alaska, buying fields from Chevron and Marathon. He’s also in big in the Utica shale of Ohio and last year sold most of his fields in the Gulf of Mexico for $550 million.

Dannine Avara, Scott Duncan, Milane Frantz and Randa Williams are the four children of Dan Duncan, founder of pipeline giant Enterprise Products Partners. Formerly the richest man in Houston, he died in 2010 at age 77.

Robert Rowling of Dallas owns the Omni Hotels and Golds Gym chains, but still has a sizable portion of his fortune in oil and gas operations such as Tana Exploration. All together his fortune is $4.9 billion (256th).

Trevor Rees-Jones is at $4.5 billion (274th). Rees-Jones first worked as a bankruptcy lawyer, and then switched to oil and gas exploration. His Dallas-based Chief Oil & Gas Co. has shown impeccable timing. Rees-Jones was an early investor and early seller (2008) in the Barnett shale gas play in Texas, netting more than $1.5 billion. He plowed cash into the Marcellus shale gas play and made another $2 billion selling acreage there to the likes of Chevron and Enerplus, and another $1 billion dealing his Marcellus pipeline network to Penn-Virginia last year.

Lynn Schusterman, with a fortune of $3.5 billion, is the widow of Oklahoma wildcatter Charles Schusterman (d. 2000) who built Samson Resources from nothing. In November 2011 the Schusterman family decided to sell most of Samson to a KKR-led group for $7.2 billion. Much of the windfall went to the Charles & Lynn Schusterman Foundation. The deal excluded deepwater Gulf of Mexico prospects like Buckskin and Moccasin that are in development now with Chevron.

Robert Holding of Utah owns Sinclair Oil and has a fortune of $3.2 billion (418th). Known by his middle name, Earl, Robert Holding parlayed a stake in Little America motel in Wyoming into a hospitality empire including ski resorts Sun Valley and Snowbasin and the Grand America hotel in Salt Lake City. He bought Sinclair Oil in the 1970s, which drills for oil and gas and operates refineries and pipelines. Holding is said to be among the largest landowners in America, with some 400,000 acres across the west.

Terrence Pegula sold East Resources to Royal Dutch Shell for $4.7 billion in May 2010. After the sale, Pegula shifted his attention and money to the game of hockey. He bought his hometown team, the NHL’s Buffalo Sabres, for $189 million in February 2011. He also donated $102 million to his alma mater Penn State to build a hockey arena and field a division one team. A former math major, Pegula switched to petroleum engineering for a scholarship and joined Getty Oil after graduation. In 1983 with a $7,500 loan from friends and family, he founded East Resources. Net worth: $3 billion.

John Arnold, the natural gas trading wunderkind retired from the hedge fund game last year at age 38 having amassed a fortune of $2.8 billion. He got his start at Enron and is said to have made $750 million in trading profits during the last days of that company in 2001.

Kelcy Warren, at $2.7 billion (523rd) is a pipeline magnate who controls Energy Transfer Partners, which he grew last year with the acquisition of Sunoco, with its 4,900 retail outlets in 23 states, for $5.3 million. That followed the purchase of fellow billionaire George Lindemann’s Southern Union pipeline company for more than $5 billion the month before. Now he’s streamlining the company. Warren’s partner in founding Energy Transfer Partners, Ray Davis, is also a billionaire, with $1.6 billion.

Rod Lewis at $2.6 billion (551st) was drilling through the Eagle Ford shale in south Texas before anyone had any idea how to produce it. In his spare time Lewis loves to enjoy his collection of World War II fighter planes. I did this feature on his collection last fall.

The Bass brothers of Forth Worth own Bass Operating Company and a host of other investments. They are notoriously private and tough to pin down, so we suspect that we’re low-balling their fortunes. Robert is estimated at $2.7 billion (523rd), Ed and Lee at $2 billion each (730th), while we’ve bumped eldest brother Sid down to $1.8 billion (825th) after his divorce from wife Mercedes.

George Mitchell, the father of the oil and gas boom, perfected the combination of hydraulic fracturing and horizontal drilling in the Barnett Shale two decades ago, then sold Mitchell Energy to Devon Energy. He’s at $2 billion (730th). In an interview with me last year, Mitchell said he thinks the government should step up regulation of fracking.

Tim Headington of Dallas-based Headington Oil comes in at $2.5 billion (584th place). Headington stayed under the radar until 2008 when he sold acreage in North Dakota’s Bakken oil play to XTO Energy for $1.85 billion. Though still growing the oil business, Headington is funding another passion, moviemaking. Through GK Films, a production company he owns with Graham King, he has bankrolled more than a dozen films including “Hugo,” which won five Oscars in 2012 and “Rango,” which won for best animated film. It will be years, however, until “Hugo” can make back its $160 million budget. The returns look better for the lower-budget flicks he’s invested in produced by the Film District division, such as “Drive” and “ Insidious.” Headington has also built two ultra-chic hotels in Dallas, the Lumen and Joule. Check out my Q&A with Headington, here.

Dan and Farris Wilks started out as bricklayers in Cisco, Texas, following in their father’s footsteps. In 2002 the brothers branched out into the hydraulic fracturing and oil field services industry with the founding of Frac-Tech. In May 2011 they sold their nearly 70% combined interest in Frac-Tech to a partnership lead by Singapore’s Temasek Holdings for $3.5 billion. The pair recently purchased the 66,000 acre N Bar Ranch in Montana from fellow billionaire Tom Siebel and they are building an airport in Cisco. They’re at $1.4 billion each.

T. Boone Pickens brings up the back of the pack at $1.2 billion (1166th). The peripatetic legend doesn’t operate any oil and gas fields anymore, but his fortune was in oil and gas, and his investment funds still trade it actively. We were wondering whether Boone would stay on the list this year after his divorce from wife Madeleine, but we’re assured that pre-nuptial agreements ensure that the couple keeps what they brought into the relationship. One of my favorite Forbes features ever was when I convinced Boone to get a brain scan and let us publish the images in the magazine.

William Macaulay runs First Reserve, the world’s most respected energy-focused private equity fund. Through his stake in the operating company and his share in its investments (more than 40 companies with $200 billion in revenues), he is highly leveraged not just to the U.S. oil and gas boom, but the world’s. His fortune is $1.1 billion, tying him for 1260th place. My colleague Nathan Vardi did this feature on him a few years ago.

Daniel Harrison, III is a newcomer to the list. We have him ranked at $1.1 billion. In 2010 Harrison leased his 100,000 ranch in south Texas to Shell Oil for $1 billion in cash plus royalties on future oil and gas production from the prolific Eagle Ford shale. The deal appears to be the biggest ever for a family with deep roots in Texas oil. His grandfather, the first Dan Harrison, was a legendary Texas oilman, teaming up with J.S. Abercrombie to discover gushers like the Old Ocean field in Brazoria County. He built up and oil and ranching empire across Texas. Father Dan Jr. ran the ranchland and was a master breeder of quarterhorses. To this day Dan III maintains a quarterhorse operation on a ranch in Fulshear. For a time, Dan III shared the empire with brother Bruce (d. 2004), and back in 1990 they sold a 43,000-acre west Texas ranch for about $70 million.

Paul Foster, chairman of refining company Western Refining returns to the billionaires ranks this year at $1.1 billion after a smoking hot performance by Western shares, up 90% in the past year. Foster founded Western Refining in 1997 and took it public in 2006. He spent his childhood finding ways to make money from manning fireworks stands to bagging groceries. As a teenager he spent his summers in the New Mexico oil fields welding pipes, digging ditches, cleaning tanks. He called that labor “the single biggest motivation to get an education.”

And lastly, at $1 billion is William “Tex” Moncrief, Jr. The veteran wildcatter, now 92, is currently involved in perhaps the biggest thrill of his career — partnering with McMoRan Exploration to drill some of the deepest wells ever in the Gulf of Mexico. Already they’ve discovered the Davy Jones and Blackbeard fields, with more on the way. Tex got his start in the business at age 10, when his father, W. A. “Monty” Moncrief Sr. (d. 1986), discovered the 6-billion-barrel East Texas oilfield.

So there you have them, America’s oil and gas billionaires. I’m sure there’s more out there

Looks like good news for Oklahoma natural gas companies and tax revenue if trends continue.

Natural gas futures erased losses to touch a 21-month high during U.S. morning hours on Thursday, after a report from the U.S. Energy Information Administration showed natural gas supplies rose less-than-expected last week.

On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD 4.319 per million British thermal units during U.S. morning trade, up 2.5% on the day.

Nymex gas prices fell by as much as 1% earlier in the day to hit a session low of USD 4.173 per million British thermal units, before retracing losses to touch a daily high of USD4.333, the strongest level since July 28, 2011.



Natural gas surges to 21-month high after bullish U.S. supply report By Investing.com (http://www.investing.com/news/commodities-news/natural-gas-surges-to-21-month-high-after-bullish-u.s.-supply-report-246740)

Natural gas is now at 4.50. Decent price for natural gas. To make a profit it needs to be around 2.75, so you'll definitely see drilling pick up fairly quickly.

Natural gas is now at 4.50. Decent price for natural gas. To make a profit it needs to be around 2.75, so you'll definitely see drilling pick up fairly quickly.

More than likely just see them turn up production a bit, they reduced the output on a lot of wells when the price dropped a couple years back.

More than likely just see them turn up production a bit, they reduced the output on a lot of wells when the price dropped a couple years back.

I'm telling you what I know. I worked in the business for 7 yrs. my father is a regional and international manager for a company of 400+ based out of okc. The NG companies have seen this coming for sometime and they are ramping up, not only production, but new wells, world-wide.

I'm telling you what I know. I worked in the business for 7 yrs. my father is a regional and international manager for a company of 400+ based out of okc. The NG companies have seen this coming for sometime and they are ramping up, not only production, but new wells, world-wide.

Sorry friend,

We own 18 gas wells in western Oklahoma. For a fact we choked 2 wells down 2 years ago with the flow capacity of almost a million cu feet per day down to 400,000. When the price gets back up to $5 we'll increase the flow. The increase in wells being drilled are for liquids rich output, not necessarily natural gas production.

On the other hand, were just little guys, a family operation.....what do we know ?

Sorry friend,

We own 18 gas wells in western Oklahoma. For a fact we choked 2 wells down 2 years ago with the flow capacity of almost a million cu feet per day down to 400,000. When the price gets back up to $5 we'll increase the flow. The increase in wells being drilled are for liquids rich output, not necessarily natural gas production.

On the other hand, were just little guys, a family operation.....what do we know ?
At the very least you understand enough to know the basics of what’s going on… But probably much more.
Others too have choke back their wells…..

The switch to NG by electric generators and the cold spring has helped NG prices but there are large supplies of NG that will IMHO keep prices from significant and lasting price rises for a very long time. + The economy is starting to slow.

There are large amounts of high BTU NG coming on line in some of the oil shale plays that is often considered bonus gas. In addition there are huge reserves of dry natural gas that can be drilled should the prices ever justify new drilling.

Higher NG prices would help our state’s prosperity and funding for state government… but about the only thing that could significantly change the situation any time soon is the export of NG… But the White house is moving at the speed of a snail on that issue. This is yet another example of getting exactly what we vote for and it directly impacts our prosperity.

You had to know this would happen….The switch NG from coal starts to shift back to coal because of high NG cost.

Very much of this will hold NG prices down…. This switch back and forth is likely to last for a very long time and help stabilize NG prices.

http://finance.yahoo.com/news/energy...175200866.html

The action in energy's incredible.

You get one strong day in oil and the group goes crazy. Check out the action in the most-levered-to-oil players: EOG EOG up 3 and Continental Resources CLR up $1.95 just out of nowhere. These stocks are just coiled springs and every time they come in they have to be bought. I would love to buy them in deep-in-the-money calls.

Meanwhile, the action in the coal-related rails is incredible. Last week on "Mad Money" we heard AEP CEO Nick Akinssaying that his company is actively switching to coal because natural gas has gotten too high. That's why Norfolk Southern NSC has now run 20 points. What a run. Makes you want to speculate on Peabody BTU but, alas, that's a China play and you sure don't want to play China.

Meanwhile, the natural gas stocks, led by Southwestern SWN , which bought some assets from Chesapeake CHK don't want to quit, despite the switching. The group is incredibly strong.

These moves are broad and powerful. They are dazzling because they can't be occurring with some economic strength, although one could argue that once again everything's being priced off the oil futures and the oil futures are going higher because of that old correlation to the weaker dollar.

No matter, the group, including the drillers and service companies, has been biding its time. Now it seems, at last, like it's shappening. I would not overthink it. The Philly Oil Service Sector (OSX) is the right way to play it.

Very interesting video on the link

Mighty algae could lead to biofuels breakthrough | News OK (http://newsok.com/article/3808160)

Some of the world's toughest and tiniest organisms could hold secrets that would make processing biofuels more effective.

Gerald Schoenknecht, an Oklahoma State University associate botany professor, is part of a team that recently completed a genetic sequencing of the Galdieria sulphuraria, a particularly hearty red algae that has been found inside active volcanoes.
“The main driving force was really to understand how this organism can survive in an environment where almost every other organism simply dies in a surprisingly short time,” Schoenknecht said.

Schoenknecht's research found some surprising results: The enzymes that make the algae so tough were “stolen” from bacteria enzymes, something that is not supposed to be possible.

“That was so unexpected that when we first saw it, we thought something had gone wrong,” Schoenknecht said. “The first thing we did was ask our Ph.D. students what they did wrong. But we ran a lot of controls, and our findings hold water.”

Schoenknecht's team published the findings in Science magazine.

“It obviously can live in these volcanic areas because it somehow acquired genes, the building structure for proteins, from bacteria,” Schoenknecht said. “Bacteria swap genes across species. This is well established. This is why we have problems with antibiotic resistant bacteria in hospitals.”

The findings could help strengthen biofuels research by giving scientists access to the tough properties in the red algae.

Researchers throughout the country are trying to develop processes to better break down the thick, tough walls in corn stalks, switch grass and other nonfood biofuel
The process relies on mostly man-made organisms and enzymes to break down the sturdy, protein-rich plant parts into gasoline, diesel and other fuels.

What is the impact?

Schoenknecht and others hope to take the knowledge from the volcanic algae and apply some of those cell properties to the organisms used with biofuels.

“Our research could be useful in having an organism that can tolerate high heat or metal contamination,” Schoenknecht said. “The idea is that if we understand how this red algae can deal with hostile environmental conditions, it may enable us by genetic modification to toughen biofuels-producing algae, to introduce this ability into biofuels algae.”

Ray Hunke, director of the Biobased Products and Energy Center at OSU, leads biofuels research concentrating on switch grass and other possible feedstock. He said more research is needed in all aspects of the biofuels process.

“We take a holistic approach at Oklahoma State,” Hunke said. “We have a team of researchers who are working together and evaluating how we can utilize our resources via the various conversion process.

“It's a feedback mechanism. Everyone is talking to each other to achieve the best possible scenario, the most efficient process available, through our research,” Hunke said.

This is a by- product of increased natural gas production and an example of how we should be doing more to add value to our oil & NG production in Oklahoma. Doing so creates wealth and jobs and often lowers cost for people in our area who buy these products.

Click link for full article.
Koch expects to add jobs at Enid fertilizer plant | News OK (http://newsok.com/koch-expects-to-add-jobs-at-enid-fertilizer-plant/article/3567439)

ENID — Koch Nitrogen Co. is nearly done with a $20 million expansion project at its Enid fertilizer plant that is expected to allow it to add another 25 jobs over the next couple of years.
He called that center the backbone of the expansion project at the plant, which can produce up to 3,000 tons of anhydrous ammonia a day. That is about 10 percent of the nation's nitrogen fertilizer production.

Anhydrous ammonia, which is made from natural gas and other ingredients, is used in the plant's other fertilizer products: urea and urea ammonium nitrate, or UAN.

“We will be opening new well-paying, technical positions in phases as our operations ramp up in Enid over the next few months,” he said.
Koch is the world's third-largest maker and marketer of nitrogen fertilizer. The Enid plant is the company's largest.

This is a by- product of increased natural gas production and an example of how we should be doing more to add value to our oil & NG production in Oklahoma. Doing so creates wealth and jobs and often lowers cost for people in our area who buy these products.

Click link for full article.
Koch expects to add jobs at Enid fertilizer plant | News OK (http://newsok.com/koch-expects-to-add-jobs-at-enid-fertilizer-plant/article/3567439)

ENID — Koch Nitrogen Co. is nearly done with a $20 million expansion project at its Enid fertilizer plant that is expected to allow it to add another 25 jobs over the next couple of years.
He called that center the backbone of the expansion project at the plant, which can produce up to 3,000 tons of anhydrous ammonia a day. That is about 10 percent of the nation's nitrogen fertilizer production.

Anhydrous ammonia, which is made from natural gas and other ingredients, is used in the plant's other fertilizer products: urea and urea ammonium nitrate, or UAN.

“We will be opening new well-paying, technical positions in phases as our operations ramp up in Enid over the next few months,” he said.
Koch is the world's third-largest maker and marketer of nitrogen fertilizer. The Enid plant is the company's largest.

An example of what? Who is "we" and what is it "we" should be doing more of?

Yo . . . Bro Z Keeper . . . Please be advised that there is no profit involved in attempting to sway rumor-mongers and drummers away from overuse of those pesky pronouns. =)

Yet feel free to continue the quest in that direction . . .
It may help to clarify the ox and the gorer (so to speak) =)