Bakken Predictions for 2013

After a stellar set of predictions in 2011,  our 2012 predictions were a bit off the mark.  However we are confident that we will have a roaring comeback in 2013 and a number of predictions will come to fruition.      In 2012 ,  we saw  the vast majority of Bakken producers end the year 15-20% off their highs (most peaked in Feb/March of 2012) but very close to where they started the year in 2012.    Effectively most Bakken plays traded sideways throughout the year as oil wallowed between $80-$90 for the better part of the year.

SYMBOL PRICE 52 WEEK RANGE % CHG FROM 52-WK HIGH 1-YR TRGT PRICE P/E NEXT YR
CLR 73.022 61.02 97.19 -24.92% 96.25 15.80
WLL 43.17 35.68 63.97 -32.45% 58.81 11.67
EOG 121.50 82.48 124.5 -2.47% 134.83 19.43
STO 24.80 22 28.95 -14.34% 27.22 8.53
HES 52.59 39.67 67.86 -22.43% 64.67 8.41
KOG 8.82 6.92 10.9 -18.90% 11.39 12.39
MRO 30.51 23.17 35.49 -13.96% 37.24 9.47

In 2013 however, we do expect a rebound of top tier Bakken stocks but this is largely predicated on the fact that the US economy will have a modest recovery (assuming congress  can get past the fiscal cliff issues).    Without further ado,  our top 3 predictions are below.

  • Oasis Petroleum (OAS: 8.59 -0.92%) hits $45 per share in 2013 or gets acquired.  –  This admittedly is a regurgitation of our 2012 prediction, but we feel strongly that Oasis has quality acreage and production ramp-up that will make it an attractive target.  With the exception of maybe 1-2 other O&G companies in the region,  Oasis is one of the closest things to a Bakken “pure play” stock.   For more detailed analysis on OAS, see our latest in-depth article on the company.
  • US Silica (SLCA: 28.12 +1.11%) hits $25 per share in 2013 –  We have outlined this stock a few times and it certainly is a market leader in Silica production in the Bakken Region .   The forward PE for this stock continues to be under 8 and has extremely strong cash flow which position it well for growth in 2013.
  • The Bakken Region will surpass 28 million barrels of production per month with 6000 producing wells. –   The Bakken region is continuing to maintain its growth trajectory with 30%+ year over year growth expected through 2020.    Some interesting stats on monthly production can be found at the North Dakota Dept of Mineral Resources site here.

Until next time,  keep drilling

 

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