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May 12th – Bakken Fund Update
Posted by bakkenexpertAs you have noticed, we haven’t been reporting much over the last few weeks. Part of the reason was around the Dr Jekll and Mr Hyde persona the market has taken on lately for which we were on the sidelines in cash. The dust hasn’t fully settled but hopefully the occurrences of the 1000 point “flash crashes” over the next few weeks has passed. Surprisingly, through the overall market correction our Bakken plays held their ground for the most part. We exited our positions about 3 weeks ago expecting market turmoil. We got the turmoil we expected, but investors definitely didn’t abandon their Bakken plays. Had we held the positions, we would be roughly at the same point we are today. We currently stand up 26.2% since inception back in February and are currently 100% in cash with no open positions. We are looking for targeted opportunities to get back in the market, but will do so with caution and build positions. Some of the stocks with the highest forward PE’s such as Brigham Exploration and American Oil & Gas were the ones that held up the best with minimal if any drops in pps. Below is a chart that shows us exiting all positions before the market correction but still beating the Dow and Nasdaq while being 100% in cash
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Tags: aez Bakken Fund BEXP cash djia dow flash crash turmoil
The only people making money in the Bakken are service companies, investment bankers and those giving themselves stock options and then unloading them. The NDIC website publishes all the production data on all the wells. Only the wells in the Parshall-Sanish Pool will ever be economic. Brigham’s production decline rates are falling like a roller coaster. The data is easily downloades in Excel and you can take a look and draaw your own conclusions. The 300,000 acres they have cost then north of $30 MM and most of it will expire before they get it drilled. There are two “hot spots in the Bakken – Elm Coulee and Parshall. Everywhere else it is non-economic. Do your homework, investors.
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