CARBO Cites ND Rail Delivery Problems

Coming off a record production year of 1.6 billion pounds, one of the leading manufacturers of ceramic proppants for fracing, CARBO Ceramics, Inc. of Houston, said there are problems in shipping product to the Williston Basin.

“North Dakota is a pretty tough situation,” said president and CEO Gary Kolstad on a conference call with Wall Street analysts on Jan. 26. There are a number of problems, including rail congestion and customers not ready to take delivery, according to Kolstad.

The problem is not unique to CARBO, which reported a record net income of $33.1 million in the fourth quarter, but also plagues oil service companies and others trying to get product into the state. “It is a whole infrastructure thing,” Kolstad said.

Bakken horizontal wells with ten to 30-stage fracs at 250,000 pounds per stage could use up to 2.5 million pounds per well, the company said.

McJunkin Red Man Corp. opened a new regional distribution center totaling 89,000 square feet in Cheyenne, WY this month to serve its stores in nine states, including the Niobrara shale play and Williston Basin. Shown here is Stephen Leeds, one of 25 new employees who will be working at the facility, which includes a 12-acre pipe yard. “We believe this facility and the increased inventory commitment will enhance our ability to provide exceptional service to our growing customer base in this thriving region,” said Rory Isaac, executive vice president of business development for MRC.

ND Commission Keeps Unit Running

The ND Industrial Commission turned down a request from several royalty owners to dissolve the Glass Bluff-Madison Unit in McKenzie and Williams counties because the operator stopped water recovery operations.

However, the commission said that the operator of the unit, Paul Rankin, Inc., must appear before the commission in December to present data on production as well as information about the injection process. No injections have occurred in the unit after they were stopped in May 2011.

Allen G. Lassey and several other royalty owners, which make up about 15% of the ownership, petitioned the commission to terminate the unit. Petitions from at least 60% of the royalty owners are required to dissolve a unit.

Liberty Resources LLC is expected to take over the operation from Rankin and will implement a waterflood program.

Upcoming Events

January 31–Feb. 1: Bakken Product Markets & Takeaway Capacity 2012, at the Marriott City Center Hotel in Denver.

Among the speakers is Hank True, CEO of Eighty Eight Oil LLC, who will look at price comparisons between pipeline markets to get the best possible rate for Bakken crude.

Bill Koch, vice president of business development for Bear Tracker Energy LLC, will discuss the midstream markets, with an assessment on oil prices and production patterns.

Booking barrels for takeaway 365 days a year to avoid cuts in production caused by trucking restraints or harsh weather will be addressed by Peter Hill, CEO of Triangle Petroleum.

Greg Hills, vice president of marketing for Oasis, and Michael Lutz, commercial director for Hess, will analyze several issues including the supply and demand for railcars, price and operational comparisons between rail and pipeline.

Several other related issues will also be discussed. For a full lineup of speakers and registration information, visit: www.bakken-markets-2012.com.

January 31–Feb. 2: 6th Annual Midstream Summit at the Houston Marriott West Loop.

Rail and pipeline issues in the Niobrara play in Wyoming, Colorado and the Williston Basin will be addressed. The summit is being sponsored by Infocast.

For a full lineup of speakers and registration information, visit: http://infocastinc.com/index.php/conference/midstream12.

February 1–2: Second Annual Oil & Gas Summit at the Ft. Berthold Indian Reservation at New Town, ND. The summit will be hosted by the Mandan Hidatsa Arikara Energy Division.

Topics for the summit include a tribal chairman’s leadership panel with industry experts along with updated drilling plans, and a panel of university and tribal college presidents.

For more information, call 701-627-5154 or register at www.mhanation.com.

February 7–9: ND Safety & Health Conference at the Bismarck Civic Center. More than 600 safety directors from three states and several energy and service companies are expected to attend the sessions and trade show that features keynote speaker Garrison Wynn.

“Safety, now more than ever, needs to be at the forefront of everything we do,” said Chuck Clairmont, executive director of the ND Safety Council. “At the NDSC, it is our mission to keep safety a top priority.”

For registration information, visit: http://www.ndsc.org.

Feb. 29–March 1: North American Crude Marketing Conference at the Hyatt Regency Houston. A discussion of crude price differentials will kick off the two-day conference, which is sponsored by Platts.

Francisco Blanch, a researcher for Bank of America Merrill Lynch, Richard Grissom, vice president of market analysis for Valero Energy Corp., and Edward Morse, commodities researcher for Citgroup Global Markets Inc., will lead off the panel discussion on light sweet crude differential pricing.

Reservations can be made online at http://northernamericancrude.platts.com/ConferenceDetail/2012/pc214/index or by calling 866-355-2930.

April 2–4: Bakken Investor Conference at the Sleep Inn and Suites at Minot, ND. Terry Hildestad, president and CEO of MDU Resources, will be the keynote speaker.

The conference will focus on issues facing operators and investors in the Williston Basin, with an emphasis on geology, capital markets, water reuse initiatives, and infrastructure development, along with housing and commercial development.

Also planned are presentations from exploration and production companies, which will update attendees about their operations in North Dakota.
More details on the conference can be obtained by visiting: http://bakkenconference.com.

April 12–13: Platts 6th Annual Rockies Oil & Gas Conference at the Grand Hyatt Denver. On the two-day program are: Tim Maloney, business development manager for Bakken Express, LLC; Doug Williams, general manager for Willbros Engineers; Trisha Curtis, research analyst for Energy Policy Research Foundation, Inc.; and Kevin Williams, vice president of the northern business for DCP Midstream LLC.

David J. Stone and Roger Pinkerton, executives with Marathon Oil, also have top billing on the program, along with Jim Duncan, director of market research for ConocoPhillips. Keith Palmer, an executive with Alliance Pipeline is a speaker, along with Bill McAdams, president and CEO of Aux Sable Liquid Products.

Those looking for sponsorship opportunities can call Joshua Vernon at 781-430-2113.

For registration, visit: http://platts.com/ConferenceDetail/2012/pc218/index, or call 866-355-2930 and use registration code pc 218EM.

April 18: Second Annual D-J Basin and Niobrara Oil and Safety Conference and Exposition, at Aims Community College in Greeley, CO. The conference will focus on state-of-the-art safety and environmental issues.

Included in the lineup of speakers will be representatives from Occupational Health and Safety Administration, as well as Wyoming state OSHA. In addition to eight feature speakers, there are 18 breakout sessions planned.
The increased interest in this year’s conference and the quality of presentations will make this the premier professional conference for oil and gas safety professionals.

For more information on registration and hotel accommodations, visit: http://djsafetyexpo.com.

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