05-26-2013 08:29 PM
Just got notice Continental is about to drill a 12 million + dollar well on some land I have 5 acres of royalty on in Carter county. Might be a bit early to start popping the champagne corks but I'm thinking that might be pretty good.
05-26-2013 08:41 PM
I'm thinking it will depend on the production, sales price, and your decimal.
Originally Posted by tennsooner
05-26-2013 08:48 PM
Yeah I leased it on a 3/16. The well is approximately 11,000 deep and horizontal for app. 9000 ft covering two sections. I'm thinking if they are spending that much money they must see something they like.
Originally Posted by Ira Knee
05-26-2013 08:53 PM
06-03-2013 10:33 AM
Mon Jun 3, 2013 9:53am EDT
June 3 (Reuters) - Kodiak Oil & Gas Corp said it would buy oil and gas ****ets in North Dakota for about $660 million from privately held Liberty Resources to expand in the region.
The company said it was acquiring properties in the Bakken and Three Forks formations and undeveloped leasehold in the Williston Basin of North Dakota.
North Dakota has experienced a surge in out put after tapping into the giant Bakken shale formation which straddles the U.S. and Canadian border, turning the region into the second-largest oil producing state in the United States.
The Bakken Formation and Three Forks Formation, which spans parts of Montana, North Dakota and South Dakota together hold an estimated 7.4 billion barrels of undiscovered, technically recoverable oil, a U.S. Geological Survey study said in April.
The deal will add 42,000 net acres of producing and undeveloped properties to Kodiak's ****ets, bringing its total holdings in North Dakota's Williston Basin to about 196,000 net acres.
The ****ets acquired through the deal produced about 5,700 barrels of oil equivalent per day in May, Kodiak said.
The deal, which is expected to close in July, would immediately add to the company's financial results on a per-share basis, Chief Executive Lynn Peterson said in a statement.
"We view this transaction as a modest positive, as Kodiak was able to add contiguous acreage to its inventory of core Bakken acreage at a reasonable pricing," analysts at Robert W. Baird & Cowrote in a note.
Shares of the Denver-based company were trading marginally lower at $8.76 in early trade on the New York Stock Exchange
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06-03-2013 04:04 PM
Anybody hear a rumor that Conoco will be moving headquarters to OKC and building a skyscraper?
06-04-2013 09:55 AM
Conoco is smack dab in the middle of the energy corridor in Houston. OKC/Oklahoma would have to give them a tax exemption for decades to make it worthwhile, never mind that Houston's an extremely hot upstream job market right now, meaning to announce a move and ask employees to hook up and leave would gut their engineering staff.
06-04-2013 10:00 AM
Yeah, but Houston sucks.
Originally Posted by krypton
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06-04-2013 03:38 PM
True story right there.
Originally Posted by The
06-04-2013 04:38 PM
I can't deny it.
Originally Posted by QRISooner
06-06-2013 02:35 PM
Southern Ute Tribe seeks to expand shale-oil drilling in SW Colorado
Texas-based Swift Energy isnâ€™t the only company chasing the lure of the Mancos Shale in La Plata County. The Southern Ute Indian Tribe-owned Red Willow Production Co. drilled one well into the Mancos Shale formation in December and now is planning to lease 12,000 acres of tribal minerals on Fort Lewis Mesa for further exploration.
The development likely will mean more of the type of horizontal shale drilling that has drawn packed crowds to county meetings and incited passionate debate about shale-oil exploration, multistage hydraulic fracturing and the impacts they could have on the countyâ€™s land, air, water and economy.
Red Willowâ€™s initial development would focus on the Niobrara member of the Mancos Shale, according to a letter from the Bureau of Indian Affairs, which is conducting an environmental ****essment of the proposed lease. The company anticipates drilling horizontal wells that will require hydraulic fracturing, the letter said.
Of the 12,072 surface acres proposed in the lease area, 1,422 are privately owned and the rest are tribally owned, according to county measurements. The company has not yet determined a potential number of wells or well locations.
Because all of the tribeâ€™s exploration and production is happening within the boundaries of the Southern Ute Indian Reservation, those activities are outside of the countyâ€™s land-use jurisdiction. However, as part of the Bureau of Indian Affairsâ€™ required environmental ****essment of the lease, the county was informed and asked for comment about the proposed agreement last month.
The county offered several comments to the BIA, many of which were points of concern brought up in public hearings the county held about shale-oil development proposed by Swift Energy. Residents repeatedly expressed concerns about the larger volumes of water and chemicals, higher injection pressure, increased truck traffic and bigger well pads required in the multistage hydraulic-fracturing process required to unlock natural gas and oil from shale. Residents worried about potential effects to groundwater, air quality and traffic levels ****ociated with the process.
The county also outlined concerns about potential degradation to county roads caused by well-development traffic. Contractors for the construction, drilling and completion of wells likely will access the lease area through county roads, and the increased water usage required by multistage hydraulic fracturing likely would be a major source of truck traffic.
In addition to outlining Red Willowâ€™s drilling plans, the BIA letter laid out concerns that not developing tribal minerals in the area would risk those minerals being drained by private entities drilling nearby.
â€śIf the lands ****ociated with (the proposed lease agreement) remain unleased, potential depletion through drainage ****ociated with the development of neighboring fee lands would constitute a permanent loss of valuable mineral resources to the detriment of the (Southern Ute Indian Tribe) and its members,â€ť the letter said.
The proposed leasing area is just southeast of a 588-acre unit where Swift Energy plans to drill one exploratory shale-oil well, leading county staff to wonder whether Swiftâ€™s drilling plans spurred the tribe to consider developing the area.
Though protecting the tribeâ€™s minerals always is a concern, plans for the area predate Swiftâ€™s drilling activities, said Bob Zahradnik, operating director of the Southern Ute Growth Fund, which manages and operates Red Willow.
â€śWeâ€™ve been looking at (the area) for a long time. We were just waiting for the appropriate time to develop it,â€ť Zahradnik said. â€śThe technology has matured now to make it possible to develop this stuff.â€ť
The Mancos Shale well that Red Willow drilled in December 2012 has not gone into production yet, Zahradnik said. The company has done several tests and is weighing whether itâ€™s worthwhile to build the infrastructure necessary for the well to go into production phase, he said. The well, which is oil-producing, was the first Mancos Shale well drilled in La Plata County.
Other companies that have drilled wells into the Mancos Shale in the San Juan Basin have produced varying levels of oil and natural gas.
Encana has drilled 23 Mancos Shale wells in the San Juan Basin to date, Encana spokesman Doug Hock said. As of March, the companyâ€™s efforts had yielded â€śa variety of results,â€ť Jeff Balmer, Encanaâ€™s San Juan Basin ****et manager, said during a conference.
â€śThereâ€™s some good stuff, some modest stuff and an area we havenâ€™t really figured out yet,â€ť Balmer said.
In 2010, WPX Energy drilled two horizontal wells in the Mancos formation in New Mexico that produced natural gas at high rates, company spokeswoman Susan Alvillar wrote in an email.
ConocoPhillips and Bill Barrett Corp. also are testing the Mancos Shale, according to an article in The Daily Times of Farmington.
06-07-2013 01:43 PM
Some more Bakken stuff. Just general updates......towards the end.....CLR may have up to 15,000 drilling locations???? That's kind of a big number. I think its in the Holy **** category....
Oil Keeps Pouring out of the Bakken
By Matt DiLallo
June 6, 2013
Oil production coming out of the Bakken was closing in on 800,000 barrels of oil per day as of this past March. This has some speculating that the play's production might be able to top more than a million barrels of oil per day before the year is out. Let's take a look at some of the companies that are working hard to keep oil pouring out of the Bakken.
Among them is Marathon Oil (NYSE: MRO ) , which has upped its guidance for Bakken production by 14% after a strong first quarter. The company thanks its increased utilization of rail capacity for helping it realize higher sales out of the region. During the first quarter, 45% of its Bakken crude oil was transported via rail, an important development in the play that enables producers to send oil to both coasts. Marathon has been further helped by some of the fastest drill times of its entire geographical portfolio; spud-to-spud time is just 25 days. This really helps boost the company's rate of return, which is very good for its bottom line.
Another company that has enjoyed success in the Bakken is EOG Resources (NYSE: EOG ) , whose performance in the play has been continually impressive. EOG has worked to get its costs down which has, according to the company's president, Bill Thomas, "resulted in improved, direct after-tax rate of return from our drilling program, giving us current Bakken returns that are comparable to our Eagle Ford program. The results continue to set us up for many years of excellent drilling in the play." The company only plans to get better as its working to develop and implement new fracking techniques in the Williston, which Thomas believes will enable EOG to "continue to lead the industry in Bakken and Three Forks drilling results." This has encouraged the company to look to increase its drilling activity levels in the Bakken this year as long as crude oil prices remain in its current range.
EOG isn't the only company improving upon its methods to achieve better returns in the play. Halcon Resources (NYSE: HK ) has experienced early positive results from updates it made to its Bakken drilling operations. Initial production results were improved in just the first two months of the project, with two wells seeing initial production rates increase by 20%, while a third well experienced an initial production rate that was 37% higher. Its success in the Bakken is the main reason behind the company's decision to spend about 38% of its capital budget on the play this year, which equates to about $475 million to drill 75 operated wells.
Few companies though are as levered to the Bakken as Kodiak Oil & Gas (NYSE: KOG ) and Continental Resources (NYSE: CLR ) . All of Kodiak's capital this year will be devoted to developing its Bakken acreage. The company expects to spend $740 million to drill about 75 net wells. This should boost the company's production from an average daily rate of 14,400 barrels of oil equivalent last year to between 29,000 and 31,000 barrels of oil equivalent per day this year before taking into account its recent acquisition.
Meanwhile, Continental has ascended to the top of the production list as the company produced 77,000 barrels of oil per day last quarter. With the top lease position in the play at 1.2 million net acres, Continental has a massive opportunity to grow its production in the future, with the potential for drilling up to 15,000 wells in the region. The company is among the lowest-cost producers with per-well costs now down to just $8.3 million.
Bakken oil and gas companies are able to produce more oil by expending less capital, which will really drive improvements in the overall rates of return. Production growth is important, but without generating profits, that growth is of little value to investors. The good news is that the trend of lower costs and increased production looks like it will deliver significant long-term profits for investors.
06-07-2013 03:10 PM
I don't understand why KOG didn't move well above $9.00 today. I kept waiting for it & it never happened.
06-07-2013 11:34 PM
I've been waiting for that for a year, plus.....my basis is a lot lower, but one of these days.....I think when they get the multi-zone, 12 well-pad location finished in their polar area, then we'll take off.
Originally Posted by tfoolry
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06-08-2013 08:39 PM
Lots of leasing activity in Caddo County.
06-09-2013 04:35 PM
Good deal. Never know how it may turn out, but better than a poke in the eye with a sharp stick.
Originally Posted by tennsooner
Hope they drill a hugely economical well there. Good luck.
06-12-2013 01:35 PM
This is a pretty good article. I can't wait for CLR and KOG to get their downspaced, multi zone units completed and on-line.....
Bakken: The Downspacing Revolution
Triangle Reports "No Communication" In a Downspacing Test:
On June 10, Triangle Petroleum (TPLM), a small-capitalization Bakken operator, reported its first quarter fiscal 2013 results and provided operational update. Some of the operational insights discussed by the company are quite notable. The most important is the confirmation of 160-acre downspacing feasibility in the deep portion of the Basin. The announcement may be a bellwether report which front runs a wave of downspacing test result releases by several larger operators expected later this year and in 2014.
Triangle is one of the first operators to report results of a high density drilling test in the Middle Bakken. According to the company's press release, its recent downspacing test indicates potential for 6 - 8 Middle Bakken wells per 1,280 acre spacing unit, which is equivalent to 213-160 acre density, "with no communication."
The "no communication" statement by Triangle is quite important. It suggests that there is little or no loss in well productivity and economics due to tighter development spacing. The positive downspacing resolution, if confirmed by further production history and tests by other operators, could essentially double well inventories in the most productive areas in the play, translating to significant economic value.
While many operators have initiated downspacing pilots, specific results in the majority of cases are yet to be reported. Continental Resources (CLR) deserves credit for coming forth, almost a year ago, with a high conviction view that high-density development patterns may be feasible in the Bakken with potentially little or no communication between wellbores. Continental has initiated an extensive pilot program to evaluate downspacing potential across its vast leasehold in the Bakken. One of Continental's comprehensive pilots is designed to test 160-acre downspacing (picture below). Results from the pilot will not be available until 2014. Several other operators, including Whiting Petroleum (WLL), Oasis Petroleum (OAS), Kodiak Oil & Gas (KOG) and Halcon Resources (HK), to name a few, have followed Continental with their own, often quite comprehensive, evaluation programs.
Rest of article: http://seekingalpha.com/article/1496...n?source=yahoo
06-14-2013 12:41 PM
Holy Cow! I knew the fracking was getting bigger and bigger, but this one shocked even me.
NCS frac technology completes 50 stage frac on two-mile lateral in the Bakken...50 stage frack....wow.. Article is dated March 6th, but I just saw it.
The successful completion of three two-mile lateral wellbores in the Bakken formation has NCS Oilfield Services, a technology and services company focused on multistage completions, looking to expand its presence in the Williston Basin. Using its trademarked Multistage Unlimited system, the company was able to complete 50 discrete frac stages in a single well.
The technology used by the company eliminates the need for perforations, (the process of puncturing a well casing to connect to the liquid reservoir), plugging (a process that closes off a segment of casing to allow perforation in closed sections) and ball dropping (ceramic balls dropped into the wellbore that plug a section of casing), allowing for multiple sequential fracture stages in a single wellbore.
06-14-2013 06:53 PM
Thank you I appreciate the well wishes. All this horizontal drilling is new to me but as I understand it from the letter they are going about 11,000 feet deep and then doing a 9,000 foot lateral. Got a letter last week from the corporation commission where they applied for a hearing on spacing. Going into two sections I'm not sure how that all works but I guess I just got a smaller piece of a bigger pie. Who knows what might come of it but as you say much better than a sharp stick in the eye.
Originally Posted by NickDangerThirdEye
06-14-2013 10:08 PM
Sounds like they'll, for example, drill on the north end of a section and drill south through that section and the next one south. Similar to how the Bakken is typically developed at this point. You are right with the smaller piece of a bigger pie. Both in proportionate acreage in the unit, but also the well itself. The well will hopefully be much more productive than a vertical or direcitonal well; costs more to drill but the upside is greater too.
Originally Posted by tennsooner
Don't ever pop the champagne until you have a check, but its nice to have something to look forward to. "Mailbox money" is the best kind.
06-14-2013 11:33 PM
That douche Josh Fox of Gasland "fame" got fairly well pwned from righties and even Jonathan Alter on Bill Maher tonight.
FYI, Gasland Part II will be debuting on HBO soon
06-15-2013 01:13 PM
I'm a big believer in the long-term merits of investing in the companies that are big players in the North American unconventional oil revolution. What I'm not a big believer in is the idea that oil production in the United States is going to continue grow at the rates we have seen over the past year.
I also don't believe that increasing U.S. production is going to result in a long-term drop in the price of oil.
Why don't I think oil production in the United States can continue growing at the rapid pace we have experienced over the past year?
It is because last year's production surge was the result of a move of drilling rigs from natural gas to oil that can't be repeated again in the future:
The number of rigs drilling for oil in the United States went from 200 in 2009 to 1,400 by the start of 2012. That is the big driver of the increase in oil production in the United States.
That rig count has flattened and I believe it is soon going to start showing up in the production data.
As for why I don't think the growth in U.S. oil production can significantly lower the price of oil in the long term, the answer is very simple. These new sources of oil require oil prices of $80 plus for the production to be profitable. If the price of oil drops, producers are going to quickly lay down the drilling rigs. With first year decline rates on these tight oil wells that can be up to 60%, a decrease in rigs will quickly mean a decrease in production.
This week I read an interview with legendary investor and commodities bull Jim Rogers who seems to agree with my thinking:
Fusion: Many believe the U.S. shale revolution is going to solve our energy problems? Is it over-hyped ?EOG Resources (EOG), the single largest producer of oil using horizontal wells in the United States, in its most recent presentation shows how production in the North Dakota Bakken play is now flattening:
Rogers: Yes, I believe it is. Regarding natural gas, the fundamentals on the ground are not nearly as good as the hype. The number of rigs on the ground has gone down 75% the last couple of years, as the wells are very short-lived, and it takes an enormous amount of money to keep them up. A number of companies have had to lower estimates of their reserves. As for oil shale, typical wells deplete at 38 percent the first year. Thus you need a lot of drilling, money, and a high price to keep up production rates. All you have to do is go out in the oil patch. I believe the investment world will be disappointed with the notion that supply is so great that oil will collapse.
(click to enlarge)
What Does This Mean For Investors?
If I'm right, oil prices of $90 plus are going to be the norm going forward. What I think this actually means is that investors should embrace these unconventional producers that have been responsible for North America's production growth.
Some of the top unconventional oil producers in the United States include:
- EOG Resources
- Continental Resources (CLR)
- Kodiak Oil and Gas (KOG)
The reason I like these unconventional producers is that I believe their "second wave" of production from these unconventional plays is going to be exceptionally profitable. By "second wave" I mean the secondary phase of production through downspacing and enhanced oil recovery (e.g., waterflooding).
The first or initial phase of production will involve making investments in roads, pipelines and other expensive infrastructure. The secondary phase of production will not require a good chunk of this spending as this infrastructure is already in place.
Every barrel produced through secondary production will be much more profitable than the barrels produced in the initial production phase. That means that cash that was previously needed for investments in infrastructure now becomes available for distribution to shareholders either through balance sheet improvement, dividends or share repurchases.
I'm invested in these unconventional oil producers for the long term. I believe that with each passing year, the acreage that these companies have locked up is going to prove more and more valuable.
Source: Legendary Investor Jim Rogers Suspects The American Energy Revolution Will Disappoint
06-16-2013 10:15 PM
The bakken is just getting started. There is a ridiculous amount of drilling left to do. It's not going to go flat