# Another Pipeline?



## Vol (Jul 5, 2009)

Supposedly to help rail congestion.

Regards, Mike

http://www.agweb.com/article/proposed-multi-state-pipeline-could-cut-through-midwest-betsy-jibben/


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## IHCman (Aug 27, 2011)

I'm in favor of building pipelines. Every pipeline they put in will take trucks off the roads and ease rail congestion. I also feel pipelines are safer and more economical. There are 2 pipelines that cross a quarter of dads pasture. One has been in for probably 50 years and the other was put in about 15 years ago. Have never had a problem with either.

There is a new one going in north of us that'll run west to east from the Bakken over to the MN border. Sandpiper I think its called. Supposedly will be a refinery going in over by Devils Lake that this pipeline will feed to but once it hits the MN border it will stop as the permits and paperwork are holding up whether it will extend into MN.


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## Lostin55 (Sep 21, 2013)

I would be up for anything that raises the price of crude 20 bucks about now.


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## Teslan (Aug 20, 2011)

Lostin55 said:


> I would be up for anything that raises the price of crude 20 bucks about now.


Would more pipelines raise it? I would think it might lower it since more oil could get faster to the gulf. But then I'm no commodity expert.


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## TJH (Mar 23, 2014)

My grandfather was a pipeliner, and I worked my high school and collage years to get through. Pipelines are the safest way to transport any liquid. I would rather have one in my yard than a high voltage transmission line.


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## Lostin55 (Sep 21, 2013)

Teslan said:


> Would more pipelines raise it? I would think it might lower it since more oil could get faster to the gulf. But then I'm no commodity expert.


It would lower the cost. My comment was more regarding the current economic status of oil and the broader implications of what may be a long term bust.


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## Vol (Jul 5, 2009)

Lostin55 said:


> It would lower the cost. My comment was more regarding the current economic status of oil and the broader implications of what may be a long term bust.


Let's talk about crude a little bit Allen....word on the street is that opec is artificially deflating the price of crude to try to destroy American oil exploration, development, and refining.....artificially dropping the crude price to stop American refining due to the high cost of fracking extraction and other more recent methods of recovering oil....thus making crude prices so low that it is not economical for current extraction methods here in this country. What is the oil industry saying about this...truth, rumor....or maybe a little of both.

Regards, Mike


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## Lostin55 (Sep 21, 2013)

Vol said:


> Let's talk about crude a little bit Allen....word on the street is that opec is artificially deflating the price of crude to try to destroy American oil exploration, development, and refining.....artificially dropping the crude price to stop American refining due to the high cost of fracking extraction and other more recent methods of recovering oil....thus making crude prices so low that it is not economical for current extraction methods here in this country. What is the oil industry saying about this...truth, rumor....or maybe a little of both.
> 
> Regards, Mike


It is a little of both actually. They are not artificially dropping the price, they are letting it fall by refusing to cut back production levels to balance the supply and demand. OPEC has long been the largest player in oil and gas and they no longer are, due in part to our recent boom here and several others worldwide. Different arguments can be made depending on where you are in the world and where your Countries income is derived.
Our costs to produce stateside are much higher than the middle east for example due in part to them not having an EPA or OSHA to answer to. In addition to that, they are drilling in oil sands and we are drilling typically in oil shales. Shale requires fracking technology, which you mentioned. Our costs are roughly twice what theirs are for all of these reasons.
It is nearly impossible to cover the subject thoroughly in a short post like this, but the majority of what you have heard is true. OPEC and others, like Russia, are trying to starve out the small players in the US. Their hope is to bankrupt enough of them that they can then profit from the lower supply and higher price. Not to oversimplify the situation, because it is very complicated, but right now we have a worldwide game of chicken going on, or Russian roulette. If the member countries of OPEC cut production prices go up and that would be good for us. If they starve out US producers then prices go up, good for them.


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## Vol (Jul 5, 2009)

Saw this tonight....some interesting insight/outlook.

Regards, Mike

http://www.agweb.com/article/richest-canada-grain-family-betting-on-oil-rebound-blmg/


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## Lostin55 (Sep 21, 2013)

In a similar move during the '08, '09 downturn, a friend of ours risked it all and upgraded heavily while his competitors layed off people and changed their target market. He was literally paying .30 cents on the dollar for the latest technological advances. When the market rebounded he was very well positioned to capitalize, and did just that. 
Warren Buffet has made a living countering market conditions. I just wish that I had the chutzpah, and money, to do the same.


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## Vol (Jul 5, 2009)

Saw this article this morning form Forbes on the world oil industry.....good read....and it just further emphasizes that the Saudi's are still King.....for now.

Regards, Mike

http://www.forbes.com/sites/nathanvardi/2015/01/05/saudi-arabias-750-billion-bet-drives-brent-oil-below-54/


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## deadmoose (Oct 30, 2011)

So basically without collusion from non opec producers they are maintaining supply. I like the fact that it appears for a small amount of time all of big oil is not in bed together. What are the chances of that continuing?

I wonder how much my cell phone bill would be if they had no competition? Double? Teiple? Worse?


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## Vol (Jul 5, 2009)

Road diesel is under $3 gallon here today.....I know it is disappointing for the oil industry compared to the profits that they did make just 18 months ago, but I really don't care. It is helping many folks in this country and hurting a whole lot fewer. I hope this is more of a long term affair myself. Now, if we could just get fertilizer back in line, a fella might be able to still make a decent profit in the grains, specialty crops, and forages.

Regards, Mike


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## deadmoose (Oct 30, 2011)

I paid $2.369 for off road on Sat. On road I have since seen $2.65. And $1.96 for gas. I have driven my truck more in the last month than in the last year. A guy asked me last week at work: what's wrong with the Saturn? Good for a chuckle.  I filled said car up for $17 something yesterday.


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## Lostin55 (Sep 21, 2013)

I agree with you in several ways Mike.

The only point that I would add to your comments is that it isn't just oilfield people that are affected. In the mountain west, and many parts of the South, a large portion of the economy is fueled by oil income. The latest housing boom, real estate boom, and many business expansions are directly related to "oil money" in the areas listed. I wish it were as simple as a few thousand people getting layed off and the rest of the country benefitting from it. The unfortunate truth for many areas of the country is that the oil money makes it's way through the economy in a multitude of ways and when that dries up, so do good and services, construction, trucking and the trades in general.

Of course many people benefit from the lower fuel prices and that is good of course, but what happens when Oil companies are reduced by, let's say half, and prices skyrocket? There is always a give and take and for the life of me I cannot figure out why we can't run on an even keel, so to speak, with marginal and sustainable growth instead of boom and bust and the answer is simply greed. It also pays to remember that a good portion of that greed is held by the stockholders of the public companies as they must produce a return on investment for those stockholders. I certainly don't have the answers, and they pay people a whole lot smarter than me to figure it all out. I am little more than another cog in the wheel.

As for me and my family, we are fine so far and anticipate that we will continue to be unless it gets really bad, which is always a possibility. In the end, if this gets bad enough we have plenty of ways to make a dollar and a lot of meat in the freezer. I have never starved yet and don't anticipate that we will.

The most difficult part for me is yet to come and that may very well be telling some really good hardworking men that they are out of a job in this economy.


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## Bonfire (Oct 21, 2012)

Filled the pickup up today. $2.85. Gas was $1.95.

Talked to some folks in western OK yesterday. They're still drilling out there. All flex rigs. 9-12K' deep then horizontal for 2 miles. They can drill down to the desired zone they want, then go horizontal in that zone and be much more efficient at capturing resource vs. drilling straight down to the zone and being limited to that one quarter (or whatever that particular spacing is) of ground.


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## Lostin55 (Sep 21, 2013)

It is funny that you mention Flex Rigs.........

There has been a shift in the industry to the directional work that you mentioned. Extended reach laterals are now the thing. The proprietary technology of that particular style of rig happens to lend itself well to the anticipated needs of the industry, not to mention that the company that owns that trademark is well positioned to gain market share in a down turn.

Many competitors have already stacked a pile of iron in multiple districts. In this district we are just starting to stack them out. It is the same in Western OK, South Texas, California, and other places.


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## Bonfire (Oct 21, 2012)

The way I understand these flex rigs is that you can drill a hole and go horizontal in one direction. Pull out and move over maybe 20', drill another horizontal hole in another direction. Point being, you can drill multiple holes from one location. Hell you can come back years later and drill another hole at that same location into a different zone and be above or below the lateral you drilled earlier.

I can see a whole lot of efficiency in this. These flex rigs eliminate the cost of building multiple locations and the tear down/set up of the rig for every hole.


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## Lostin55 (Sep 21, 2013)

More to the point that you are making, there are 5 generations of Flexrig. Depending on the generation, they can skid up to 200 feet under their own power, and well centers can be as close as 7' and currently as far as 50'. It just depends on the spacing for the flowline, and one could be set up for 200' spacing if needed. It would just not utilize the capability of the rig very well. They can be set up in several different configurations depending on the needs of the operator.

Dual laterals, as they are called, are now common place and are done frequently.

One of the more expensive things to do with a rig, other than drilling, is to move it. There have been more advancements in moving technology and engineering for quick moves than could possibly be covered here.

In case you are wondering, I am looking out the window at one right now.

Edit. They are a pretty nice piece of engineering. The savings on rig moves with the skidding capability is also impressive. They are not the only company that has rigs with the ability to skid, but for multiple reasons I like them the best of all.


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## Bonfire (Oct 21, 2012)

You must be a Pusher.

Keep it turning and don't lose circulation!


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## Bonfire (Oct 21, 2012)

Here is a picture that was sent to me of a new well location in western OK. The four pallets are covering 90' deep holes full of concrete and rebar. The rig structure itself will sit on these piers which will provide support for all the weight of pipe being pulled out of the ground.

The big culvert in the middle has two holes drilled in it (both covered). The one in the center is the starter hole for the well. The one off to the side is for drill stem storage (the next joint) during drilling.

This is what was explained to me. Maybe Lostin can explain better.


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## Lostin55 (Sep 21, 2013)

Not sure about the "piers" with the pallets over them, as I have never used them. The footprint of a Flexrig has a compaction rating for the soil underneath. Maybe the compaction rating couldn't be met?

The large piece of culvert is called the cellar ring. It is just a hole in the ground that can range in depth usually from 4' to 10'. A culvert is placed on it's side in that hole to prevent the ground around it from caving in and the hole allows the wellhead to sit below ground. What is commonly seen above ground is not actually the wellhead but rather associated equipment.

The center pipe is usually 16" in diameter and is called the conductor, and is usually 90' deep with cement around the outside of it and that is where you start drilling. The offset pipe is called the mousehole and is used with a shuck in it to the rig floor to handle tubulars while handling BHA and also while making up stands of drill pipe for drilling.


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## Waterway64 (Dec 2, 2011)

Every news media is shocked by the drop in oil which is probably short term. However grain dropped neArly as much and that's business as usual!!!! Mel


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## panhandle9400 (Jan 17, 2010)

TJH said:


> My grandfather was a pipeliner, and I worked my high school and collage years to get through. Pipelines are the safest way to transport any liquid. I would rather have one in my yard than a high voltage transmission line.


Tjh you are correct about safety, we have several huge pipelines that run across some of our ground , if you didnt know they were there you would not know they were there. Ship by rail has proven that it is dangerous to ship by rail. If you think different you would be wrong.


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## somedevildawg (Jun 20, 2011)

I wish they'de run another through our hunting land.....


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## Lewis Ranch (Jul 15, 2013)

somedevildawg said:


> I wish they'de run another through our hunting land.....


Some wonderful shooting lanes!


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